Innovative Solution for California Workers Compensation Audit!

A fairly new California contractor client of ours was ready to hire employees for the first time. Not knowing how well the business was going to perform, they decided to predict conservative annual gross payroll figures for their California workers comp quote. After the policy year ended, an audit was performed by the carrier. Fortunately, our client did extremely well that year showing much more payroll processed than originally projected. However, the extra payroll ended up costing them a whopping $350,000 in audited premium.

Our client was extremely concerned about this new large outstanding balance and was confident the unpaid premium was going to put them out of business.  We suggested that we look deeper into the details of the audit results to make sure all information was accurate and if there was any available solutions to help lessen the cost of the audit bill. After a full review we found that some employees were eligible for less expensive class codes which could offset the cost of their workers compensation audit.

By taking the time to meet and brainstorm with our client as a team, we found an effective solution that allowed the carrier to revise their California workers comp audit by $200,000 resulting in a final total bill of $150,000. The carrier was also open to providing a payment plan on the owed amount allowing our client to modestly pay the unpaid premium.