Case Studies Examples of difficult issues that are readily identified by our Regulatory Compliance Audit
Construction
A construction company contracted with us because they were concerned with increasing costs. Their premiums were increasing even though they had relatively low claims activity. The company’s concerns were valid. Our audit identified carrier errors resulting in inflated premiums. Below are the results of our audit.
09/05/03-04 Original mod rating 1.13 Revised mod rating 1.04 Returned premium $12,441
09/05/04-05 Original mod rating 0.93 Revised mod rating 0.83 Returned premium $14,073
09/05/05-06 Original mod rating 0.96 Revised mod rating 0.85 Returned premium $10,177
This company received a $36,691 refund check from the carrier within 90 days of signing the audit agreement.
Manufacturing
Our client recently purchased a manufacturing plant. Their insurance agent assured them the experience of the new plant was properly reflected on their experience modification factors. After reviewing the experience rating, we discovered the new data was incorrectly reported. As a result of our work, our client received improved experience ratings and refund checks.
01/01/03-04 Original mod rating 1.14 Revised mod rating 0.92 Returned premium $35,313
01/01/04-05 Original mod rating 1.09 Revised mod rating 0.95 Returned premium $15,551
01/01/05-06 Original mod rating 1.06 Revised mod rating 1.00 Returned premium $6,687
The total refund was $57,551
Health Care
We recently conducted an audit for a healthcare company. During the audit, we identified several less than obvious errors. For example, a claim was reported incorrectly on the loss run and on the experience mod worksheet. Consequently, when comparing the loss run to the experience mod worksheet there didn’t appear to be an issue. Only a comprehensive investigation could have revealed the claim had been subrogated. We identified the issue and worked with the carrier to obtain a correction to the experience rating. The corrected experience rating resulted in a premium refund of $31,257.