Wellington has proven that it is not what you expect but what you inspect when it comes to insurance and reinsurance contract compliance. Wellington makes available customized audit packages for insurers, reinsurers, regulatory authorities and equity groups involved in investment activities to encompass all major operational elements of insurance.
Generally, Wellington Financial Services. (“Wellington”) audit services are used for assurance of contract compliance, third party quality control and due diligence. In conjunction with a major multi-national accounting firm, Wellington developed an innovative, proprietary audit plan for cedents designed specifically to review programs that have been terminated and/or are in a run-off status. The plan was developed at the request of reinsurers frustrated with the traditional audit services and methodology which failed to yield meaningful results to verify treaty compliance.
A program review can be applied to the whole book of business or limited to specific transactions. Optional audit elements include:
Analyze individual treaty compliance and validate adherence to underwriting warranties and representations;
Confirm fiduciary responsibilities of insurers/cedents as evidenced in claims management philosophies, operations and systems; and evaluate the technical claim settlement practices through review of amounts paid and reported (also targeting areas of potential savings and/or legal exposure to improve underwriting results and reduce potential liabilities).
Determine if premiums and commissions have been correctly assessed and administered, verify that unearned premium is collectable and validate underlying policy data.
While the plan does include statistical analysis, Wellington’s focus is to identify areas most likely to yield material errors in premium and loss submissions and check fundamental treaty compliance, which, to date, has yielded savings of many millions of dollars for our clients.