COMMERCIAL INSURANCE
AUDIT PROCEDURE
In most agencies, audits are processed much like all other types of mail. Because of the adverse financial impact that an audit can have upon an agency, it is our opinion that a specialized processing take place.
Unlike other company billings that are normally controlled by the CSR/Marketer, it is our feeling that the audits be under the direct supervision of the bookkeeper or financial manager.
1. All audits when, received by the Financial Manager/Bookkeeper are logged in on Form audit.frm
2. Financial Manager/Bookkeeper establishes a follow up date 5 days prior to the date that an audit can be returned to the company for direct collection.
3. Financial Manager/Bookkeeper notes on the agency copy of the audit the follow up date and forwards the audit to the CSR/Marketer for processing.
4. CSR/Marketer reviews the Audit confirming that the correct rates and exposure units have been used.
5. If audit is incorrect, immediately return to the company to be reissued and notify the Financial Manager/Bookkeeper.
6. If audit is correct, CSR/Marketer invoices the audit and mails to customer with Cover Letter.
Dear :
Enclosed you find the final audit on your _____ policy, number ______, which expired _______ .
I believe that the audit is correct after having verified the rates and mathematical extensions. However, if you find any errors in the exposure information, please call me within three working days and return the original audit to me for correction.
Audits represent fully earned premium on an expired policy, and are subject to special handling procedures between our office and . We, therefore, require your payment within 15 days.
Sincerely,
Enclosure
7. CSR/Marketer verifies the follow up date established by the Financial Manager/Bookkeeper.
8. If the customer remits the payment prior to the suspense date, Financial Manager/Bookkeeper notifies the CSR/Marketer and removes the follow up.
9. The CSR/Marketer updates the customer's electronic file and files appropriate paper in the transactional file.
10. If the additional audit premium is not paid on time, the Financial Manager/Bookkeeper notifies the CSR/Marketer and Producer.
11. The CSR/Marketer and Producer then have 24 hours to make a decision (based upon the agency's policy) whether or not to
- Contact the customer and collect the money immediately
- Advise the Financial Manager/Bookkeeper to return the audit for direct collection
- Advise the Financial Manager/Bookkeeper that they will guarantee the audit premium and to allow the cut-off date to pass