What it does
WC 00 04 24 (Ed. 1-17) adds to Part Five, Section G (Audit). If the insured does not let the insurer examine and audit all records relating to the policy, or does not provide audit information as requested, the insurer may apply an Audit Noncompliance Charge. The Schedule shows, by state, the basis of the charge and the maximum charge multiplier. If the insured later allows the audit, premium is revised under the manuals and Part Five, E. (Final Premium).
Key provisions
- Failure to cooperate may also lead to cancellation under the policy terms.
- For assigned risk (state-approved plan) policies, failure to cooperate may affect eligibility for coverage.
Where it applies
The North Carolina bureau's instructions make the charge optional in the voluntary market but require the endorsement on North Carolina assigned risk policies, and say it must be attached at inception of the term being audited for the charge to apply. Massachusetts lists WC 00 04 24 as withdrawn effective May 1, 2021.
Quoting and selling notes
- Explain at binding that the policy premium is an estimate and the audit is mandatory; insureds who ignore audit requests can be billed a multiple of estimated premium.
- Help clients prepare payroll by class and state, subcontractor certificates and overtime records before the audit appointment.
- For assigned risk insureds, the form itself warns that failure to cooperate may affect eligibility for coverage.
Related forms
Base policy WC 00 00 00; premium due date WC 00 04 19.
