Insurance premium auditing is an essential process for making sure companies pay the correct premium rates according to their true risk exposure. Annual audits help to confirm the amount of insurance exposure by examining factors such as payroll, business operations, and losses. This process is ultimately based on estimates, so there can be over- or under- estimates. Errors in these predictions can be expensive; companies might get unanticipated fees for underpayments or take longer to get credits for overpayments. Estimation inaccuracies are unfortunately pretty common and have affected around 25-50% of business owners with insurance policies, resulting in billions of dollars in lost premiums every year.
In order to complete an audit, an auditor will examine financial records, including payroll logs, tax records, cash disbursements, and insurance certificates. There are plenty of channels that are used to complete this audit, such as over the phone, online, or by email. Regardless of the method, AI can help streamline this process and reduce the likelihood of inaccuracies in the data collection process. For example, AI is capable of using predictive analytics to predict trends, impacts, and risks while detecting anomalies. By leveraging this technology, companies can avoid overpaying their premiums and make sure that their rates appropriately represent their risk profile.
