Comp Check - Workers Compensation Audits
What is COMP Check?
The Workers Compensation Audits Process:
Insurance Companies are huge paper factories engineered to push paper like no other organization in the western hemisphere. Your Workers Compensation Audit is no exception. It’s designed for speed, performed typically by an outside firm that pays the auditor $150 per audit. That person wants to get it , and get out quickly because time is money. Further insurance carriers by law have only a small window in which to perform this audit as mandated by state law. Typically 60 days after the policy expiration.
The auditor arrives at your door step always at the most inconvenient time. You rush them to the conference room, give him your State Unemployment Tax Returns and your payroll ledger. Understand the Audit starts with 100% of your payroll in the governing class code / highest rated code, they then systematically try and pull employees down into the less expensive class codes by job classification. If they misclassify an employee it’s typically in the carriers favor because the DEFAULT is to the highest rated code. Unless you catch and pull all the eligible employees into the lower rated class codes they are automatically charged at the highest rate. Deviously clever of them isn’t it, unless you have COMP check that audit’s the auditor.
COMP CHECK Audits the Auditor:
We look for these Common Errors:
- Improperly Classified Employees
- Improper Territory Allocation (18% NYC differential
- Unused Exception Allowances or “excluded remuneration” (Restaurants hit hardest here)
- Improper Sub Contractor Charges
- WRAP UP Deductions Not Applied
- Mathematical errors (remember speed)
- Poor Payroll System Report Set Ups
The error rate with respect to the NY Workers Compensation Insurance Payroll Audit system is over 62%.
Who in your company is verifying this information is correct? Do you have a Workers Compensation Premium Recovery Solution? Contact Met Risk today to begin Auditing the Auditor to make sure you are getting all the proper deductions your are entitled, and to pull back worker’s compensation premium over charges for dollars that are rightfully yours.