You are penalized and overpay when the "Audit Police" make a mistake

3. You are penalized and overpay when the "Audit Police" make a mistake on an audit

Because your real insurance cost is determined after your policy expires, it is essential the audit is correct. You're at a disadvantage from the start. The insurance company auditor knows the rules, you don't. The auditor is not compelled by law to explain the rules, even if applying a rule would cause you to pay a lower premium. Here's how the auditor works against you:

- Your entire payroll is put into the highest classification

- Then, the "standard class exceptions" are put into the correct cost classification. When someone is not properly moved to the lower cost classification, you pay at the highest rate. Misclassifications are common and the system is designed for you to pay for all mistakes. Would you allow an  Nike Blazer Shoes,IRS agent to conduct an audit without an expert on your side? Of course not. Then, why allow an insurance company auditor to conduct an audit without an expert at your side? A workers comp audit may actually cost you more money than an IRS audit. A workers comp audit is every year. You may go years without an IRS audit.

4. Experience modification factors are often wrong or mismanaged

Most insurance buyers accept on "good faith" that their experience modification factor is correct? Why? It's just easier that way. I go into great detail about this in my article Why Assuming Your Workers Comp Experience Mod is Correct Could be a Dangerous Calculation. However, for our Nike Shox Torch,purposes here, you need to learn how to double check your mod because oftentimes it may be wrong. Your insurance company then collects an unfairly high premium.