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Auditor - Workers Compensation Premium Auditor

A Workers Compensation Term Defined, Described and Explained

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Auditor (Premium Auditor)...

The premium auditor is the person who actually audits payroll records in order to determine the final audited premium. The auditor may work either directly for the workers compensation insurance company as an employee or as an independent auditor hired by the insurance company.

It's the auditor's job to find all premium producing exposures within your business. And I mean ALL. Don't be fooled, the auditor certainly works for the insurance company, not you! So we'll talk just a bit about auditors and what they really do.

Mentioned above there are two basic types of auditors, the insurance company's employee and the independent. Here's some information about each:

The company employee auditor;
  • Is hired and works for the insurance company;
  • Is assigned a work load by a company supervisor;
  • Has a time limit on when the audit must be completed;
  • Is trained by the company audit department to review all employers records for additional exposure;
  • Is many times new and inexperienced;
  • Does not work for you!

The independent auditor;
  • Does not work for the insurance company but rather is employed by an independent service;
  • Is usually a field auditor who works out of their home;
  • Is given workers comp audits to conduct their employer;
  • Must have their assigned audits completed and returned to the insurance company within a specified period of time;
  • May have experience conducting workers comp audits or not;
  • May also conduct other types of audits and field inspections for insurance companies;
  • Does not work for you!

Who does a better job? It really depends on your specific situation. Sometimes the answer is neither! So it's the auditor's job to find all exposures they can within the records of your business. Make sure you take a look at our section on how to deal with auditors!

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