The Benefit of Boutique: Premium Audits

Client:  Audio-Visual Services Company 

Line of Coverage:  General Liability 

Issue

Client came to us after being slapped with a $56,000 additional premium audit.  The audit details were not explained to them by the insurance company or the agent.  They were told the best they could hope for was a payment plan.   .

Action

Tartan took over the account via Agent of Record and immediately began investigating the audit.  Through interviews with the client and the audit department at the insurance company, we were able to identify an unusual aspect of the audit calculation and argue the appropriateness of that action.

Outcome

Tartan successfully argued that the rates applied for the audit were not appropriate.  The insurance company re-calculated the audit using the corrected rating structure, which reduced the additional premium owed by $34,800 (60%). 

Commentary

It is not uncommon for routine premium audits to contain errors.  Insurance company personnel can make mistakes, or mis-interpret data, just like the rest of us.  It’s critical to have an agent that is willing to take the time to review audit documents and has the expertise to identify and overturn erroneous calculations.