We just got word we have successfully reduced a Workers Comp audit bill for a Georgia small business client, down from the original $170,121 to $9,660. The insurance company had already turned this over to a collection agency before we got involved and that collection agent had been seeking that wildly inflated premium bill since last year. Fortunately, there are provisions to suspend such collection efforts while an audit is being disputed, and we made sure this client got the benefit of that while we worked to correct all the mistakes in this audit.
Around our shop, we call these situations Shock Audits, and this case neatly exemplifies how extreme these overcharges can be.
This was another Shock Audit from the Georgia Assigned Risk program--we've been seeing a lot of those, for some reason. Assigned Risk policies can be particularly perilous for small businesses, as the insurance agents who sell these policies typically aren't too much help in disputing these audits, even with the best of intentions. In the Assigned Risk plan, the agent has just about no real leverage with the insurance company and usually lacks the technical expertise to fight these excessive audits effectively.
And some of the insurers who issue these Assigned Risk policies, it seems, have been getting rather carried away in doing these premium audits, as this case illustrates. If not for our assistance, the usual course would have seen this insurer filing a lawsuit for this excessive amount, once the collection agent was unsuccessful (and he would have been, as this small business had no chance to pay that hugely inflated audit bill.) And that likely would have been the end of this small business.
Instead, the fair and proper premium has been paid, and this small contractor gets to continue.
As I like to say, we don't sell insurance--we fix it.