If you’ve received a surprise bill after your insurance policy term ended, you’re not alone. Audits are a standard part of Workers' Compensation and General Liability policies, and they’re designed to compare your estimated payroll and revenues to what actually happened during the policy period. If those estimates were low — or if documentation was missing — you might owe more than you planned. This article covers the most common questions we get about audits and how you can work directly with the carrier to get things resolved.

What Is an Insurance Audit and Why Is It Required?

Most Workers’ Comp and General Liability policies are based on estimates. When the policy ends, your insurance carrier performs an audit to determine your actual exposure (like payroll or revenue). If your actual numbers were higher than estimated, they’ll bill you for the difference. If they were lower, you might get a refund.

Audits usually happen annually and can be done online, over the phone, or through physical mail. Submitting accurate information and documentation is key to avoiding surprises.

Common Reasons You Might Owe More

• Underestimated Payroll or Revenue: If your actual numbers were higher than what you estimated at the beginning, you’ll owe the difference.
• Uncovered Subcontractors: If you used subcontractors but didn’t collect Certificates of Insurance (COIs), they will be treated as your employees. This is because the insurance carrier has no proof that those subs carried their own coverage — so they assume you're responsible for them.
• Owner Exclusion Setup Issues: If you meant to exclude yourself or a partner but didn’t document it properly, you may have been charged. Workers’ Comp policies have minimum and maximum payroll thresholds that apply to owners, which can result in added premium even if you didn’t think you needed coverage.
• Autopay Confusion: Autopay typically covers your estimated premium, not any additional amounts due after the audit.

Frequently Asked Questions

Why do I owe more?

"I thought our Workers’ Comp was only $___/month?"
That amount was based on estimated payroll. If your actual payroll was higher, the audit will bill you for the difference.

"We don’t have any W2 employees — only subcontractors."
Unless your subcontractors provided valid COIs, the carrier will include them as part of your payroll. Subcontractors without proof of their own coverage are treated like your employees under the audit — which means you're charged premium for their labor.

"It’s just me and my partner — why do we owe anything?"
If only one of you was excluded at policy inception, the other may have been included as covered — and that adds premium. Also, even if both of you are owners, Workers’ Comp policies apply state-specific minimum and maximum payroll amounts to each owner included in the policy.

"Our subcontractors have their own Workers’ Comp."
This is one of the most common audit issues. Let’s look at a few common questions:

• "Why do we owe more? Our subs have their own Workers’ Comp?"
• "We only use subcontractors — no employees — so why are we being charged?"

In both cases, the answer is usually the same: unless you provided Certificates of Insurance (COIs) proving your subcontractors carried their own coverage during the policy term, the carrier will assume you’re liable and charge you accordingly.

There’s something wrong with our audit

"We’re overpaying substantially. Can you help?"
If you believe there’s an error in your audit, the best first step is to contact your carrier directly to request a detailed breakdown. Ask them to walk through how the final numbers were calculated and what documentation (such as payroll reports or COIs) they used — or didn’t use. Often, carriers will reprocess the audit if missing or corrected documents are submitted.

If you're still unsure after that, send us the audit and any supporting docs, and we’ll do our best to guide you — but starting with the carrier helps get answers more quickly.

I don’t have time or I’m completely lost

"Can you help submit the audit for me?"
We understand audits can be overwhelming. The best course of action is to work directly with the insurance carrier, as they are the ones who process and finalize the audit results. Review your audit instructions and log into the carrier's audit portal (or call them). Most carriers have audit teams ready to guide you through each step, explain what documentation is needed, and answer any questions.

"I had a terrible audit experience last year."
We hear this a lot — and that’s why we’ve created this guide. The more organized and proactive you are with documentation, the smoother it goes. If something feels off, your carrier’s audit department is your best first call. If you hit a wall, we're happy to help review and point you in the right direction.

I’m on autopay — why am I getting a bill?

Autopay usually applies to your estimated premium, not your final audit balance. If the audit determined you owe more, that difference is billed separately.

What You Can Do Next

• Review your audit notice carefully and contact the carrier’s audit team directly with questions
• Gather payroll reports, revenue statements, and subcontractor COIs
• Submit any missing or corrected documents to the carrier
• If you’re still stuck after speaking with the carrier, send us your audit notice and documents — we’ll do our best to help from there

Conclusion

Audits can be stressful, especially when the numbers don’t make sense. But you’re not alone. In most cases, working directly with the insurance carrier is the fastest way to get clarity and corrections made. If you’re still unsure after trying that route, contact us — we’ll do our best to support you.