Workers Compensation audit needs your attention

[crazy^millman]

To all the business owners out there. I have never been given a notice like this before having Workers Compensation. It was required by one of our customers even thought I am the owner they still required me to have it for myself to go onsite. No where when I signed up and renewed was this mentioned and now after the fact they want to send me this.

Thank you for renewing your Workers Compensation policy with us! We look forward to providing you with coverage for another year.

We wanted to alert you that as a condition of your previous policy expiring on February 10, 2022, (Name Removed) Insurance Companies requires that an audit be completed to determine the actual premium that should have been in force. No need to be alarmed though, all Workers Compensation policies require an audit at the end of the policy term.

Someone from (Name Removed) Insurance Companies will be contacting you via phone or email with instructions. The documentation required generally includes payroll information (e.g. payroll journals) and/or sales information (e.g. sales tax returns) for review.

Upon completion, you will receive a refund if the original exposures were overestimated or an invoice if they were underestimated. Any additional premium generated as a result of the audit will be due regardless of whether or not you have a current policy with (Name Removed).

Please note that non-compliance may result in an increase of up to or in excess of 200% of the estimated annual premium by (Name Removed) Insurance Companies. Any unpaid balance will be sent to collections and may result in cancellation of current coverage with an adverse effect on your credit history.

Now is it me or does this sound like legalized extortion? Just another way to stick it to small businesses.I got 50 microbucks that they never issue a refund and always require a company to pay more.   

[RobertELee]

All you should have to prove is your a sole proprietor with no employees. Hopefully the income earned through that company that required the WorkComp is enough to justify the hassle.

[crazy^millman]

All you should have to prove is your a sole proprietor with no employees. Hopefully the income earned through that company that required the WorkComp is enough to justify the hassle.

I don't allow the company to make a dime. Between insurance and taxes that was paid last year it was more than most people make. Hopefully the $60k loss gets me a refund. I setup the C Corp after the AB5 law was passed to be allowed to keep doing what I do in this state. I thought making a profit with the company was a good thing. I learned never making a profit doing what I do as a Corporation is best. Had to pay taxes on profit the first year and then turn around and pay taxes again on that profit when we were was paid from that money. Pay myself and the wife as W-2 and get the Health insurance paid by the Corporation. P&L reports are done by me. The Corp taxes done by the CPA firm that takes care of the Company Payroll. Every other customer was okay with not needing a Workman's Compensation Policy because I am part owner of the company and my health insurance covers me. This company required it last year and said okay you are being invoiced whatever that cost comes out to be. I get a refund I will deduct it from their next invoice. I get a bill then I will invoice them for the amount. Just seems like a way for insurance companies to just determine whatever they want to milk a company. Think of all the government jobs that got added because of this. You are asked to provide documentation upfront to even get a policy and yes things change. but part of the business they are in. They are just legalized gambling and to have this ability after the fact is just legalized extortion. Lobbyist earned their money on this legislation when this became a law in the different states that require this.

[BrianP.]

You make me glad I just punch a clock. 😛

[RobertELee]

You make me glad I just punch a clock. 😛

He makes me glad I don't live in Kalifornistan.

[CNCAppsJames]

I will happily work for someone else. Sure I may make less money, but I do not get any enjoyment whatsoever from the "business" side of running a business. Already been down that road once before and thanks but no thanks.