Commercial Premium Audits FAQs

We've gathered answers to your most popular questions below. 

What's on your mind?

A premium audit is a review of your business records to see if they match up with the coverage you have on your business insurance policies. The premium audit is done when your policy period is over or your policy cancels, to make sure you were charged the correct premium for the policy.

The main purpose for your premium audit is to make sure you’re paying the correct premium for your policy.  Here’s how it works:

  • Your premium is based on your business activities and risk exposures during a policy period, such as payroll, gross sales and total costs.
  • At the beginning of your policy period, your premium is estimated based on these future activities and risk exposures.  
  • Once the policy period is over, a premium audit is done to see if your actual activities match up with what you were charged for.
  • If you were charged too much, you’ll get a credit. If you were charged too little, we’ll let you know the difference you owe.

Premium audits are also done to meet regulatory requirements, help prevent fraud, collect ratemaking data and obtain additional information in case your business has changed. 

We use four different methods to conduct premium audits:

  • Self audit – We'll send you a letter that contains additional information (including a URL) you'll need so you can submit it online.
  • Phone audit – Our vendor partner will mail you a form and follow up with a phone call. 
  • Physical audit – Our vendor will call you to set up an appointment for an audit at your business. 
  • Hybrid audit -- This is similar to a phone audit where our vendor partner will mail you information and set up a phone call with an auditor. The mailing will include: 
    • the date and time of your appointment.
    • specific accounting information you'll need to provide your auditor before your phone call.

If you prefer, your accountant can assist with the audit, but our auditor will still need to speak with you to verify the information provided by your accountant. 

The type of audit we select for your business will be based on several factors, which vary by the type of business. 

Premium audits are conducted shortly after your policy period is over, or if your policy is cancelled before the policy period is over. If you request a cancellation, your policy is reviewed for audit shortly after the cancellation is processed.  If the policy is cancelled for non-payment of premium, the policy will be reviewed for audit approximately 30 days after cancellation.

We’ll need information from the following records for your audit:

  • Individual payroll records including gross wages, vacation/holiday pay, bonuses and commissions paid
  • State and/or federal quarterly tax returns (941s/UC3s)
  • General ledger
  • Check register
  • Documenation of total costs (labor and materials) and certificates of insurance for all subcontractors hired

Other records may be requested based on your operations.

Utilize this Premium Audit System guide for step-by-step instructions on how to complete your self-audit report.

Yes, the audit is for the period of time your policy with COUNTRY Financial® was active. Even though you no longer have the policy, the audit must still be completed for the time your policy was active.

Our fax number for commercial audits  is 866-888-0730. You can use this number to send your audit directly to our premium auditing department. You may also email your audit to

We’ll send you a Premium Audit Statement for each policy premium audit resulting in additional or returned premium. This Audit Premium process is for the previous policy term or a canceled policy term.

Once the premium audit results are known for the previous or canceled policy term, the premium for your current term will also be adjusted based on those results. This process in known as a Change Due to Audit.

The results of the premium audit will also be reflected in your next commercial insurance invoice. The invoice may include:

  • Current Payment
  • Audit Premium
  • Change Due to Audit

We may have mailed you a second audit request while your completed audit was on its way to us. If you received a second request within a week of mailing us your audit, that’s most likely the case. If you’d like to verify that we received it, please give our Premium Auditing department a call at 888-421-8589.

The audit form is designed to gather information from a wide variety of businesses. For owner’s payroll, information is requested mainly for owners who have coverage under workers compensation.

The payroll information is also used to reconcile payroll totals between owners/employees and the amounts requested for payroll verification on forms like 941 or state unemployment. As part of each audit review, workers compensation exclusion endorsements are carefully reviewed to determine which owners are included within coverage and will be charged and which owners are excluded and will not be charged. Your information will be protected in accordance with our Customer Privacy Notice.

No, individual receipts aren’t necessary. Please just note the total amount of gross receipts/sales/revenue on the form.

In some cases, gross sales are a factor in determining the premium for a policy, and they may also be used to determine eligibility within our various insurance programs. For example, the amount paid to subcontractors can’t exceed a certain percentage of gross sales in order to be eligible for certain policies.

Regularly determining gross sales is a way to make sure you have coverage under the correct policy. Your information will be protected in accordance with our Customer Privacy Notice.

We use 941s and state unemployment compensation reports to verify your payroll. Some reasons for differences may include policy dates not matching the quarters or owners/officers excluded from the policy are included in the reports. If your numbers don’t match up, we’ll determine next steps depending on your specific circumstances.

Most subcontractors are hired to complete a portion of a construction project that the hiring contractor is unable to complete. If you’re the hiring contractor, this creates potential liability for you. It’s important to ensure that the subcontractor you hire provides a certificate of insurance with coverage limits equal to or greater than your limits, while also naming you as an additional insured. This will help protect you from any actions on the part of the subcontractor which result in a general liability claim.

Contractors in Illinois should also learn about state employee classification laws. The purpose of these laws is to:  

  • Correctly classify workers as either employees or independent contractors and
  • Prevent the classification of employees as independent contractors to avoid paying employment costs such as workers' compensation insurance.

Premiums on auditable commercial policies are determined on an estimated basis. When your policy term is over, we complete a premium audit to determine actual business activities (payroll, sales, etc.). If we estimated too high of a premium, you’ll get a credit. If we estimated too low of a premium, we’ll let you know the difference you owe.

If you don't comply with the audit in time, your premiums will increase.

  • General Liability and Business Owners Policies will increase by 25% (in all states).
  • Workers' Compensation premiums will increase by: 
    • Arizona - 200%
    • Wisconsin - 100%
    • Georgia, Illinois, Missouri or Minnesota - 25%


COUNTRY Financial® is a family of affiliated companies (collectively, COUNTRY) located in Bloomington, IL. Learn more about who we are.

For product and service information, read our Terms & Conditions. Read our full Financial Services Summary Handbook.