Marshfield Insurance: Making Audits Less Scary

It’s that time of year again – don’t ignore those audit forms!

An insurance audit is done is done after the policy expires and is used to determine what the actual exposures were and compare the actuals to the estimates.

“Audit is a scary word because we associate it with taxes, but really it’s just a review to make sure that what was estimated balances with what was actual,” said Carmella Moon, CISR-Elite Commercial Service Agent.  “The audit is a tool that is used to make sure that you pay the appropriate amount of premium for the exposure that you would have had for your coverage.”

With general liability, there are several different exposures to consider, which is why oftentimes the “actual” is different than the “estimate.”

“When you’re talking about total cost, payroll, etc, those are estimates because you are looking forward,” said Moon. “With an audit, you can go back and look if you really did have the level of payroll you thought you would, for example. If you didn’t, then you overpaid. If the estimate was low and you exceeded the estimate then there will be additional premium due.”

Moon reminds businesses to fill out any audit forms they receive, or risk a fee from the auditor. Also, reach out for help if there’s any confusion.

“The commercial service agents at Marshfield Insurance are here to help out in any way that we can,” she added. “We are the connection between the insured and the carrier. If you are new to it, it is very confusing. We are here to help.”

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