Worker's Compensation Insurance

19 Employers need to be aware that workers’ compensation insurers have the right to audit payroll records at anytime. Usually this right is reserved for the final audit, but an insurance company can conduct interim audits as well. Failure to comply with an insurance company’s audit can lead to the cancellation or non-renewal of a policy, and insurance companies can use all legal means at their disposal to collect outstanding premiums. In addition, the WCIRB can promulgate experience modifications using reported losses but excluding unaudited payroll, which typically results in an increased experience modification from the prior years. It is important to be aware that the deliberate under-reporting of payroll is considered insurance fraud and can be prosecuted to the fullest extent of the law. The WCIRB also has the right to conduct an audit of an employer’s payroll records, which allows it to evaluate the accuracy of the payroll audit performed by the insurer. Does the CDI Handle Workers’ Compensation Claim Issues? It is important to note that most disputes between injured workers and workers’ compensation insurers do not come under the jurisdiction of the CDI [1 ] . The DWC assists employers and employees with workers’ compensation claims. If an employer or employee has a question or concern regarding a workers’ compensation claim, he/she can contact the DWC’s Information and Assistance Unit. When disputes arise regarding a workers’ compensation claim, the DWC’s Information and Assistance Unit can assist an unrepresented injured worker in resolving the dispute. If the Unit is unable to resolve the dispute, a formal Application for Adjudication (dispute resolution) can be filed with the DWC. The Information and Assistance Unit may be able to help an injured worker file the Application with the DWC unless an attorney has been retained. The DWC has exclusive jurisdiction over dispute resolution. [1]. In specific instances, CDI does investigate the fraudulent submission or denial of workers’ compensation claims (California Insurance Code Section 1871.4).