Colorado Business Insurance Audit Advice
One item that can cause much frustration for business owners in Colorado is the insurance audit and resulting audit premium due. Insurance premiums are based on estimates for the year. Depending on the type of policy, the premium will most likely be determined by estimated payroll or gross revenue. If you started the year with a low estimate, the audit could result in an increase in premium that would be due when the audit is completed. If you did not meet the estimated payroll or revenue, the audit could result in a premium refund that could be applied to next year’s premium or would be payable to your company.
Not every policy is audited, but if yours is audited you will receive communication from the insurance company notifying you of the audit. The audit will either be done via mail, over the phone, or in person. They will give you a few weeks notice and relay the appropriate documents you will need including tax returns, payroll records, work comp certificates, and other payroll and revenue documentation as required.
Orcutt Insurance Group prefers to work with our clients by clearly communicating how a policy is rated before it is purchased. This helps our Colorado business clients understand how the premium could fluctuate after the audit is performed. Also, if your Colorado company is growing and the revenue or payroll are increasing, we suggest that you adjust your policy during the policy year to help avoid a large payment due following the annual audit.
As a reminder, Orcutt Insurance Group is an independent Colorado and Denver based insurance agency that can assist you with all your insurance needs including, but not limited to, general liability, workers compensation, commercial automobile, property insurance, professional liability, and much more.
Thank you for considering Orcutt Insurance Group. We look forward to working with you and providing your Colorado business with insurance that meets your needs at an affordable price.
The Orcutt Group Team