Are You Prepared For A Workers’ Compensation Audit?
Workers’ Compensation Insurance
Every business must have workers’ compensation insurance. This kind of coverage is designed to protect the workers from on-the-job injuries. Workers’ compensation also protects the employer from liability in the event of a workplace illness or injury.
Workers’ compensation insurance premiums are based on estimated payroll. The insurer has the right to audit the business payroll to make sure the reported payroll is accurate.
The kind of information the auditor may need includes:
• Payroll records for the audit period
• Federal tax reports
• State unemployment tax reports
• Any overtime records
• Payments to sub-contractors
Conversely, do you know that you can also audit your workers’ compensation insurer? The purpose of the audit is to identify any overcharges in medical bills, time loss payments, and rating calculations. Experience indicates that over 50% of all companies have been, or are currently, overcharged for their workers’ compensation premiums.