What is the benefit of our workers' comp policy?

• A. Annual audit with a large end-of-year fee
• B. Audited monthly, no large fee at the end of the year
• C. Monthly premium increases
• D. Fixed premium regardless of payroll

Answer: (B)

In workers’ comp, the premium is tied to payroll and sometimes to claims, so the amount can change as your payroll changes. The key benefit of auditing monthly is that the premium stays aligned with actual payroll throughout the year, and you don’t face a large, uncertain bill at year-end. By adjusting costs in smaller steps each month, budgeting becomes smoother and there’s no big surprise at the end of the year. If payroll goes up, the premium adjusts proportionally in smaller increments rather than a single large catch-up charge. Conversely, if payroll dips, costs can decrease accordingly. This contrasts with options that imply a big annual audit fee, ever-rising monthly premiums, or a fixed premium that ignores payroll changes.