Additional Premium Due for Your Workers Compensation Policy?
Why is my architect/engineering firm getting an additional premium invoice due for the workers compensation policy? There may be several reasons for getting an additional premium due but if it is at the end of the policy period it may be due to a workers compensation audit.
The workers compensation policy is an policy, meaning that at the end of the policy period the insurance company will conduct an audit. The insurance company will request additional information from your firm with regards to salaries and job titles for the time the policy was in effect. This may, in turn, create an additional premium due.
The workers compensation premium, for a renewal policy, is an estimated premium. Because the policy is audited at the end of the policy premium the renewal is only an estimate. The reason for the estimate is that the salaries for your employees may change and your firm may hire more employees. The audit captures the picture of what actually happened in the past policy period and adjusts the premium accordingly. Therefore, your firm may have an additional premium due after the end of the policy period. Conversely if your firms’ salaries have gone down or if your firm has fewer employees the audit may generate a return premium.
Also, the insurance company may adjust the upcoming renewal to the audited salaries from the past policy period. This may be another reason for an additional premium; it creates an endorsement to the renewal policy.
The workers compensation policy premium is audited after every policy period. Keep in mind this may generate an additional premium if your firm has had an overall increase of salaries or change of job titles. If you do have questions please call or email your Professional Underwriters agent.