Four Choices For A WC Premium Audit Bill
Over the years, we have received the most communications from employers when a premium audit bill has hit their desk and the payment is now due. Often, the bill has been sitting for a few weeks and the insurance carrier is now sending a second notice for payment.
There are four choices on what to do with the bill:
- Ignore it
- Review it and ask questions
- Dispute it
- Pay it without even a review
There are very detrimental effects on three of the four actions. I will cover each one in more detail.
Ignore It
Ignoring a premium audit bill just delays the inevitable. A bill (sometimes large) is due. One of the warnings here is that in most states, you will lose certain rights if you ignore the bill too long. The longer a bill sits, the more unlikely a carrier will be amicable to any questions on the bill or a very late dispute.
Most bills will instruct you to please pay it in 1o or 14 days. Your policy will usually note that you have 30 days to pay the bill. If you wait until the 29th day, this will not help your company if you have questions on the audit bill.
If you have the same carrier for your new policy as the one that is billing you for the premium audit, your company or organization will likely receive a cancellation notice. With the economy as it is, insurance carriers are becoming very stringent on cancelling your new policy and not extending any deadlines.
Review It And Ask Questions
We recommend reviewing the bill immediately and asking questions if there is something that seems amiss. Phone calls are great, but everything should be put in writing to your insurance carrier with a cc: to your agent.
Writing your agent only may not necessarily protect your rights and remedies if you later wish to dispute the premium bill. Emails are OK, but I recommend sending certified return receipt letters. This may later save you great headaches.
If you feel something is wrong on your premium audit bill, that is usually a big red flag. I always say that a gut feeling is the best indicator that your concerns may be valid. There is a list of Red Flags you may wish to review on this blog.
Dispute It
If you still feel after asking questions to your carrier about the premium audit bill that there is something wrong, you always have the right to dispute the bill – within certain deadlines.
The three things that will irritate your carrier:
- After paying the bill, then waiting months and months before deciding to dispute a bill – it is possible to do this, but your dispute will not be received well
- Disputing a bill with no reasons or data to back up your dispute – this is when you may wish to call in a premium consultant – yes, that was shameless promotion
- Disputing a bill just to delay payment – this often results in an even higher premium audit bill and may ruin the working relationship with your agent and carrier.
Paying It Without Even A Review
Paying a premium audit without even looking back over your associated policy and the auditor’s work papers to me is the worst of the four. You are not giving your company a fair shake if you just rubber-stamp pay it as a part of doing business.
I would say at least cover the Red Flags post that I referenced earlier in this post. A link to the post is provided there. Looking over your policy, audit, and premium bill does not really take that much time for at least a cursory review. You may be surprised by what you find there.
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