Definitions for "PAYROLL AUDIT"
An examination and verification of an insured's records for the amount of payroll for classes of employees which is used in determining the premium for certain lines of insurance, such as workers compensation. The company sends out auditors to determine the accuracy of the figures provided by the insured.
An examination of an insured's payroll record by a representative of the insurer to determine the final premium due on a policy for the latest policy year.
An examination and verification of a policyholder's records of employees entitled to compensation, and the amounts expended therefore, which is used in determining the premium for certain lines of insurance such as workers compensation. Premium auditors may contact you to determine the accuracy of the payroll figures. Certain policies written on a reporting or adjustable form give the insurer the privilege of auditing the policyholder's records to verify the accuracy of the premiums paid.