State Insurance Fund
Premium Audit Department: Performance Measurement and Audit Compliance The State Insurance Fund provides workers' compensation and disability benefit insurance coverage to about 45 percent of the employers in New York State. The premiums charged to these employers are based on audits of employer records conducted by the Fund's Premium Audit Department. We examined selected aspects of Audit Department operations. We found that improvements could be made in the procedures used to evaluate the performance of the Audit Department. We also found that the work performed by the auditors often did not comply with the requirements in the Audit Department manual. In particular, audits often were not conducted on the employers' premises, as required by the manual. As a result of these weaknesses, the employers' exposure to insurance risk may not be accurately determined, and the insurance premiums resulting from the audits may not be appropriate.
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