Mail-In and Hybrid Premium Audits Possible With Technology
Hybrid Premium audits are becoming more popular every year due to technological advancements. Securely scanning and emailing documents lessened the need for in-person audits by the workers’ comp premium auditor.
The two terms that seemed to raise the most questions were mail-in (voluntary) and hybrid premium audits. I mentioned these terms in an article I wrote earlier this week. I did receive a few emailed questions on these two types of audits.
Technology-based premium audits are usually the audits that we perform for clients. I first heard the term hybrid a few years ago at an NSIPA national conference.
Due to technological advancements, many audits can be performed without being there in person. Teleconferencing and the ability to scan large numbers of documents into very small files has allowed auditors to change their methods somewhat.
Mail-In or voluntary audits usually involve smaller employers. The employer “voluntarily” fills out a premium form that is provided by the carrier. Once the employer calculates the premium, a check is mailed in with the premium form. The premium is usually calculated and paid monthly.
As the article earlier this week pointed out, the states are sticklers on in-person physical audits being performed by the carriers annually. The rating bureaus see the in-person audit as developing a more accurate premium.
One has to wonder if the states will allow more hybrid premium audits in the future for larger employers. Mobile technology should allow auditors to be able to tour business without ever actually being there. States may be slow to adopt hybrid audits.
The one main steadfast rule by almost all states requires an in-person physical premium audit. This requirement means states will allow this type of audit with smaller companies.
One requirement used in the future will likely be a required physical premium audit for the first audit. The carrier may then use hybrid premium audits for subsequent years.
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