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One of my clients recently had an audit by their CGL carrier.
This client produces cabinets and has the class code and exposure rate / they sometimes use subs to intall and the class code / exposure rate is included on the audit sheet I received today.

There are times that the client also installs the cabinets they build, they install mill-work, window trim that they make. The independent (non-employee) bookkeeper decided to place a zero for the class code 91341/ Carpentry for Interior-Installation of Doors, Windows, Cabinets, Flooring.
They have the exposure of code 91341.

The bookkeeper has also told the WC auditor that the owners that aren't covered by WC, are the ones that install the cabinets, mill-work, trim, etc.

So on one had she tells the CGL auditor that all work is subcontracted and on the hand she is telling the WC carrier auditor that the owners install.

I know what I want to tell the owners but I am not sure how close their relationship is with the bookkeeper.

Any thoughts?

I can't speak to the work comp question, as I have no expertise in that area. With regards to the GL issue, the bookeeper is incorrect if she is not using the Installation code. This is a huge issue, ESPECIALLY if you are (a) in California, and (b) they are installing these products in a New Residential structure.

I would pull the file and review the Contractors Supplemental application. This should be filled out by the client, and reviewed by you. Then I would make an appointment to see the owners, and pin down exactly what they do, and exactly what they don't do. And I would review their policy to see what of these activities is allowed.

The bookeeper should not be giving any insurance advice to the owner, unless they are a licensed agent. Perhaps you can call on the bookeeping firm and sell them some E & O coverage, they just may need it!

You could try calling the owner "just to verify the information" - make no accusations. Just verifying because the info is different from what you understood. Treat it as though it might be just an error or you miss heard and you'll get far more information. The bookkeeper might be his sister....

Later in the day I spoke with the owner and he let me know that he made the bookkeeper aware that they are there for bookkeeping, not insurance consulting.

LadyBroker wrote:I can't speak to the work comp question, as I have no expertise in that area. With regards to the GL issue, the bookeeper is incorrect if she is not using the Installation code. This is a huge issue, ESPECIALLY if you are (a) in California, and (b) they are installing these products in a New Residential structure.

I would pull the file and review the Contractors Supplemental application. This should be filled out by the client, and reviewed by you. Then I would make an appointment to see the owners, and pin down exactly what they do, and exactly what they don't do. And I would review their policy to see what of these activities is allowed.

The bookeeper should not be giving any insurance advice to the owner, unless they are a licensed agent. Perhaps you can call on the bookeeping firm and sell them some E & O coverage, they just may need it!