Payroll was underestimated
Action:Notify your agent if payroll increases significantly during the policy year.
Updating estimated payroll can help reduce a large surprise at audit.
Payroll decreased
Action:Tell your agent.
Depending on the carrier and policy, exposure may be adjusted during the policy term or finalized at audit.
Received a large audit bill
Action:Request the complete audit worksheet.
Review:
- Payroll
- Class codes
- Officer payroll
- Subcontractor costs
- Certificates of Insurance
- Sales
- Job descriptions
Dispute incorrect information promptly.
Used uninsured subcontractors
Action:Expect this to potentially affect the insurance audit.
Collect valid Certificates of Insurance before subcontractors begin work.
New type of work added
For example, a remodeling contractor begins doing roofing or structural work.
Action:Tell your agent immediately.
Do not assume the existing policy covers every new operation.
General contractor requests a Certificate of Insurance
Action:Send the exact insurance requirements or contract to your insurance agent.
Requirements may include more than a basic certificate.
They may request:
- Additional Insured
- Waiver of Subrogation
- Primary & Noncontributory
- Specific limits
- Completed Operations
- Auto Liability
- Workers’ Compensation
- Umbrella
Customer requires a bond
Action:Provide your insurance/surety agent with:
- Bond form
- Required bond amount
- Obligee
- Project information
- Contract amount
- Effective date
Do not request simply “a contractor bond.” The exact bond form and requirement matter.