Audit Expectations

This information has been provided by:

The National Society of Insurance Premium Auditors

1‑888‑84NSIPA

www.nsipa.org

The Insurance Premium Audit

Insurance audits are typically performed on Commercial insurance policies with adjustable or variable premium bases. The purpose of the audit is to determine the final premium based on actual business activity.

What Records Are Needed?

• Payroll records (including federal and state forms)
• Sales journals or income statements
• General ledger
• Cash disbursements journals
• Accounting software reports (QuickBooks, PeachTree, etc.)
• Certificates of Insurance

Tips to Save Money

• Have knowledgeable staff available during the audit
• Properly summarize overtime pay
• Maintain detailed payroll classifications
• Retain subcontractor insurance certificates

When Will the Audit Be Done?

Normally within 10–20 days after policy expiration or cancellation.

Frequently Asked Questions

Q: What gives you the right to audit my records?

A: Your insurance policy is a legally binding contract that permits audits.