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Where was the premium auditor in all of this? Did they not catch anything?
What is is called when the insured under-reports? Fraud.
What is it called when the CA State Fund auditors overcharge an insured? Capitalism.
It is a common industry practice to pay 3rd party vendors to perform premium audits. Many of these vendors pay their people per audit. Do you think that an auditor paid per audit is going to be anything close to rigerous?