What a subcontractor certificate proves at premium audit
A certificate of insurance is useful evidence that named coverage existed on stated dates. It does not answer every question about the underlying work relationship.
What the official record says
A New York DFS opinion says whether a carrier may assess premium for a person called a subcontractor is a factual question dependent on the true relationship. The opinion notes factors considered by courts, including control over work methods, payment, and equipment. The NAIC PEO guideline likewise contemplates review of payroll, accounting records, certificates, and worker duties. A COI can therefore close an evidence gap without automatically deciding every classification or employment issue.
What to check on the document
Build a row for each paid entity. The certificate holder box is not enough if the insured name does not match the entity in the ledger.
- Confirm the named insured, policy number, carrier, effective dates, and workers’ compensation coverage.
- Match payments, contract, invoices, and work dates to the same legal entity shown on the certificate.
- Flag gaps, canceled periods, mismatched names, and relationship questions before submitting the file.
How to use the result
If the carrier counted a subcontractor despite a matching certificate, present the certificate and payment reconciliation and ask for the carrier’s stated reason. If the reason concerns employee status or class code, the broker and applicable state process should carry that question. Our worksheet organizes the paper and arithmetic; it does not declare a worker exempt from coverage.
A premium review starts with the policy, the carrier’s audit statement, payroll records, and subcontractor documents for the same policy period. We preserve the class codes the carrier used and show the described work beside them. A class-code argument belongs with the broker and carrier. Auditors are often right; the free check says so when the bill looks right.
Operated by Reality Contact, LLC. This is document preparation and arithmetic, not insurance advice. Reality Contact, LLC is not an insurance agent, adjuster, or licensed insurance consultant. We do not contact your carrier; you or your broker sends it. No contingency.