First, some clarity. My view of Pay-As-You-Go programs is that they must be utiilized wtih a qualified agent. They are just a way to pay premiums, but are not intended to be a tool to remove a qualified agent and place the clients in the hands of someone who is not best suited for them. Pay-As-You-Go Programs are frequently used by qualifed agents as a service to their clients.

I would disagree that most audit problems arise from miscommunication regarding exposures. This is probably not the forum to detail all of the areas where problems and overcharges occur, but WorkCompEdge addresses them in detail.

Monthly reporting is still available, but usually requires a large down payment which is held in a deposit account and does not apply to the premium due. In these tough times, removing working capital from the business is not something most employers want to do. Pay-As-You-Go Programs do not require deposits and employers only have to pay premiums on their actual payroll from their current pay period.

Thanks again for the comments … keep them coming!

This article may be a little misleading. I work with insured’s who have had audit problems. In my opinion, most audit issues are created when the insured, the agent and the carrier don’t communicate about the real exposures. Generally speaking, I also find that if there are audit issues with the WC premium, there are also audit issues with the GL coverage.

Not all payroll services are the same and not all payroll services provide the same level of service that a committed independent agent can. I am working with a multi-state client right now who is with an international payroll service. The payroll service is not providing good service and failed to identify USL&H exposures; even though they issued COI’s for marine operations. In a worst case scenario, this oversight exposed the insured’s executive officers to fines and potential jail time. While some payroll providers agree to partner with independent agencies at some level, this particular service provider does not. So the only benefit of working with this provider is a the monthly premium payment.

When I started in this business, there used to be a monthly payroll reporting option. I think that this is a still available, though probably underused option Maybe the time is right to explore this old fashioned way of calculating WC premiums.