Tag Archives: workers comp audits

A workers compensation audit is done usually every year to verify that all payroll and class codes are correct for the upcoming year. The audit is done at request of the carrier to ensure that when a workers comp claim is filed, they have the proper information to make an educated judgment on reserve payments necessary.

Workers Compensation Insurance, Workers Compensation Premium Audits

Preparing for Workers’ Compensation Audits

Are you organized for your workers compensation audits and do you know what they’re all about? It’s no secret that the word ‘audit’ tends to scare people, but as long as you have all the paperwork relating to whatever is being audited, you should be fine.


There are some things about a workers’ comp audit that are a little different to, say, an accounting audit. In the latter case, it is a check of all account keeping for a period to make sure everything is being done as it ought to be done.

There is an aspect of a workers’ comp audit that is like that, inasmuch as all the paperwork relating to your employees will be checked. However, in addition to that, one of the reasons your worker information is being checked is to set the level of your workers’ compensation insurance. To do this, you need to provide the auditors with accurate information about the number of workers you have, a comprehensive list of their tasks, what they’re paid and what, if any, work is outsourced to contractors. 

The level of workers’ comp insurance that is set after workers compensation audits dictates the level of the premium you will pay for the coverage. There may be a temptation for some employers to fudge the information in order to achieve a lower premium, but that could backfire if you are caught. As is the case with all audits, it pays to be upfront and give accurate information.

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Workers Compensation Premium Audits

Being Prepared for Workers Compensation Audits

The idea of audits of any kind may strike fear into business owners but this needn’t be the case. As long as you maintain accurate records and have the required information to hand, you shouldn’t experience any major difficulties. In this respect, there is no real difference between the types of audit you may experience – from a financial audit to workers compensation audits.

Workers’ compensation audits can be a little different inasmuch as they are used to establish what level of coverage your business needs to have and to establish a rating. You need to be able to provide the auditors with information about how many people you employ, the work they do, what they are paid, and also, whether there is work for your business that you outsource to contractors.

It really is just a matter of accurate record keeping and being upfront about your staffing. Workers compensation audits are a necessary part of establishing your level of coverage. In any case, there’s not a lot of point in withholding or misrepresenting the facts, as it can impact on your coverage. Being underinsured is financially risky and paying for more coverage than you need is just unnecessary. The moral of the story is, get your records organized and maintain them so you are always prepared for an audit of any kind.

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Workers Compensation Premium Audits

Workers Compensation Audits: An Introduction

In New York it is mandatory that all employers of at least one person have workers’ compensation insurance in place. It is also a requirement of the New York Compensation Insurance Rating Board that workers compensation audits be carried out. Here’s what you need to know:

•Audits are of employee payroll records for the purpose of determining premiums for workers’ compensation policies.
•Carriers have the right to audit at least once every 3 years.
•While the audit is compulsory, in some cases an employer can provide a premium audit payroll statement or report instead of undergoing the actual audit.
•The records you will need to make available include payroll statements, checkbook and cash book, general ledger, tax returns and certificates of insurance for covered sub-contractors.
•When the auditor visits, a member of your staff will need to be present to provide the documents and answer any relevant questions.
•Employers may receive a fine from the New York State Workers’ Compensation Board if they are unable to provide adequate financial records.
•To help determine the cost of your workers’ compensation, employers are required to forecast their payroll for the coming year. The audit will determine if that figure is correct and after the completion of the audit you will receive either a refund or an additional charge.


Workers compensation audits are a necessary part of your workers’ compensation. Providing you keep accurate and detailed financial records they should be able to be completed quickly and stress-free.