Types of claim audits
1. Quality Assurance (QA) audits
Random or triggered reviews of closed claims. QA auditors evaluate:
- Coverage determination accuracy
- Scope adequacy
- Timeline compliance
- Documentation completeness
- Payment accuracy
Findings go back to handling adjusters; patterns feed into training and performance reviews.
2. Reserve adequacy audits
Carrier actuarial and finance teams review claim reserves for adequacy. Audits ask:
- Is the reserve likely to cover eventual payout?
- Are reserves being adjusted timely as new information emerges?
- Are patterns of under-reserving or over-reserving appearing?
3. Fraud / SIU audits
Special Investigations Unit reviews:
- Claims with suspicious loss patterns
- Policies with suspicious effective-date proximity to loss
- Clusters of claims from same insured, same producer, same contractor
- Photo and estimate duplication across claims
4. Regulatory audits
Florida OIR (Office of Insurance Regulation) audits carriers periodically on:
- Fla. Stat. 627.70131 deadline compliance
- Denial patterns and bases
- Bad-faith indicators
- Rate-adequacy determinations
5. Reinsurance audits
For large losses, reinsurers audit the cedent carrier's handling. Affects:
- Whether reinsurance recovery is honored
- How large-loss reserves are set
- Cedent carrier's incentives on complex claims
How audits affect policyholders
- During the claim: pending audits can delay decisions while reviews run. Adjuster hesitancy to pay often reflects pending internal review.
- After closure: a claim closed without full resolution may be flagged by QA and reopened: unusual but it happens.
- On patterns: if the carrier is under regulatory audit for 627.70131 compliance, your claim may get paid faster; if under fraud audit, slower.
The policyholder audit right
Policyholders can request a copy of their claim file, including audit notes when they exist. Discovery in litigation expands this right. Knowing what's in the file is powerful: adjusters' candid internal notes often differ from the denial letter's stated reasons.