Glossary of Terms
For Workers' Compensation, the premium basis is always payroll. General Liability premium basis can include payroll, sales, costs, units, gallons admissions or each.
Remuneration means either money or substitutes for money. Payroll can include: Wages; Bonuses; Holiday Pay; Sick Pay; Commissions; Overtime Pay; Vacation Pay; Payment for Piece Work.
The total amount charged by you to others for all goods or products sold or distributed and all operation performed by you for others. This includes cash or trade discounts and does not include sales or excise taxes collected and submitted to government entities, credits for returned products, and freight/delivery charges if these are charged as a separate item on the customer's invoice.
The total amount paid to another organization for the cost of all labor, materials, and equipment furnished used in the execution of work they were hired to perform.
The total number of gallons sold to customers.
The total number of persons, other than working employees of the named insured, admitted to the event or events. This basis of premium will include all event attendees whether on paid admissions, tickets, complimentary tickets or passes.
The number or each unit of exposure as noted in the classification footnote such as "per person" or "per event"
An auditor will look to understand the financial exposures of your company. Typically source documents are required and reconciled against verification documents which include but are not limited to:
Payroll – Federal Quarterly Tax Reports (941's), State Quarterly Tax Reports (state unemployment)
Sales – Income statements, sales tax returns
Costs – Tax Form 1096, Income/Profit and Loss Statements, Tax Returns (Schedule A or Schedule C)