Doing Everything Right

You can do everything correctly and still be overpaying your workers’ compensation insurance premium.

It is a sad fact, but it is painfully true.


  • You can have the best risk management program in your industry and still overpay your insurance premium.
  • You can have the most aggressive and effective claims management program in your industry and still overpay your insurance premium.
  • You can select the best insurance program for your situation and still overpay your insurance premium.
  • You can select the most knowledgeable insurance agent/broker available and still overpay your insurance premium.

How can this happen? It happens all of the time for several reasons.


  • Insurance carriers report the payroll and incurred losses directly to the rating association. No entity other than the carrier reviews the reports for accuracy. Who would know if there is an error that is costing you money?
  • It is common for individual states to have rules and laws that are not consistent with the national rules. In such cases, carriers may not be aware of the rule and therefore may overcharge you. Who would know the difference?
  • Underwriters are not expert on every rule and exception that exists in every state. Carriers make a great number of errors that go undetected.
  • Carriers are typically required to file plans with the departments of insurance in the states where they do business. However, carriers do not always comply with their filed and approved plans. How would you know if they didn’t comply?
  • The civil servants in your State Departments of Insurance that are given responsibility for assuring that insurance carriers comply with state rules are typically understaffed. State Departments of Insurance, in my experience, are ineffective in enforcing the national and state rules. In our experience, they are also ineffective in assuring that the carriers comply with their filed plans.


The bottom line is: An audit of your workers’ compensation insurance premiums by an independent auditing firm must be an integral component of your workers’ compensation program if you wish to control your costs. Such an audit can provide you with the tools that you need to identify and recover overpaid premiums.

Our experience says that – in most cases – if you pay more than $100,000 for workers’ compensation insurance, have experience modification factors that exceed 1.00, and are on a fully guaranteed cost plan, the probability that you have overpaid your insurance premiums approaches 70%.

If this angers you, contact us. You need not be held hostage. We can help.

Please feel free to contact us with any questions or concerns you may have at or toll free at 800-758-2941.

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