Audits

General

• Audits are not something to be prepared for at the end of each year, it is an ongoing process throughout the year
• Certificates should be obtained as the year progresses instead of at audit time
• Exposures should be checked at 6 months to ensure accuracy when compared to estimates upon which the policy was set up

General Liability

• Chargeable payroll for employees is the gross amount paid to each employee during the policy period
• Each owner (and corporate officer) is charged a flat payroll amount of $24,100
• Amount paid to subcontractors includes materials provided by the subcontractor
• Uninsured subcontractors (includes those with limits less than $300,000) will be charged at the total amount paid to them during the policy period
• Certificates of insurance should cover the entire policy period but must at least cover the period during which the subcontractor performed work and was paid

Workers’ Compensation

• Chargeable payroll for employees is the gross amount paid to the employee during the policy period
• Owners (Proprietors, partners and members of LLC’s) are automatically excluded and must have a signed coverage request on file with the carrier; Corporate officers are automatically included and will be charged unless a signed coverage rejection form is on file with the carrier
• Insured subcontractors are not charged on Workers’ Compensation if a certificate of insurance is provided to cover the entire policy period (or documentation exists to show it covers the time in which the subcontractor performed the work and was paid)
• Amount paid to uninsured subcontractors includes:
  • the gross amount paid to subcontractor during the policy period if sub provides labor
  • the gross amount paid to subcontractor for labor only if subcontractor’s labor is separated from material (percentages are not allowed)
  • 50% of gross amounts paid for labor and material (if billing does not separate labor from material)