Since COVID, Commercial Insurance Audits Have Become Difficult, Here's Why?

 

 COVID changed insurance auditing. Many carriers kept their field auditors at home due to the pandemic, and the responsibility of audit completion fell on the backs of the policy holders. This practice has continued to this day and has greatly increased the difficulty in getting audits done. Most insureds are too busy to spend the time assembling information, going through it, and emailing it to the insurance companies. Also many do not have the understanding of the complicated insurance policy to do the heavy lifting of getting audits completed.

As audits are delayed, insurance companies send out warnings that policies will be cancelled if not completed by certain dates. Insurance companies will also bill the insureds for estimated audits. These billings can be 125% of what the prior year exposures were. Many insureds are getting surprise bills in the mail just because they have delayed getting the audits done. Yikes !!!!

The insurance industry anticipated problems when they pulled auditors from the field, as many renewal policies now come with new policy conditions outlining their process of doing estimated audits and cancellations of policies if audits are not done in a timely manner. 

So what do you need to do? 

 Reach out to your agent or broker. They can assist you in getting audits completed and communicating with the insurance companies.  From all indications, business owners doing their own audits are here to stay. This means you and your insurance professional will have to work together more frequently when audit time comes around.  

Until next time be careful out there and know your risks !

Posted by: G. Kevin Nemith CIC. CRM  Agency Leader for Hilb Group of Delaware, a division of  Hilb Mid-Atlantic Group and Hilb Group

knemith@hilbgroup.com

Top 15 insurance brokers and risk managers in the USA. 

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