How to Become an Insurance Auditor

Mar 10, 2020

Research the requirements to become an insurance auditor. Learn about the job description and duties, and read the step-by-step process to start a career in insurance auditing.

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Should I Become an Insurance Auditor?

Insurance auditors, also known as insurance premium auditors, examine policy and liability procedures, tax documents, and various other financial records of insurance policyholders. They ensure that proper insurance rates and premiums are implemented and that appropriate insurance and liability laws are being followed by policyholders. In addition to these responsibilities, insurance auditors might be expected to maintain quality control between insurance companies and policyholders.

Career Requirements

Degree Level Associate's or bachelor's degree, master's degree preferred
Degree Field Accounting or business administration
Licensure/Certification Voluntary certification available
Experience Insurance auditing, accounting or related work experience may substitute for education
Key Skills Basic knowledge of insurance types; strong written/verbal communication, people, organizational, interpersonal, and analytical skills; professionalism and attention to detail; basic computer skills; understanding of various insurance practices and policies including workers' compensation, liability, casualty, and automobile
Salary $70,500 (2018 median annual salary for auditors and accountants)

Source: U.S. Bureau of Labor Statistics

An associate's or bachelor's degree in accounting or business administration is required. A master's degree in the aforementioned fields may also be required. Voluntary certification is available. Insurance auditing, accounting, or related work experience may substitute education requirements. Key skills include basic knowledge of insurance types, strong written and verbal communication skills, strong people skills, solid organizational and analytical skills, and the ability to interact with others in a professional manner. Additional valuable skills include the ability to work alone and be accountable for decisions made, basic computer skills, and an understanding of various insurance practices and policies, including workers' compensation, liability, casualty, and automobile. According to the U.S. Bureau of Labor Statistics, the median annual salary for auditors and accountants was $70,500 as of May 2018. Let's take a look at the steps needed to become an insurance auditor.

Step 1: Earn a Postsecondary Degree

In many cases, insurance auditors may be required to have a postsecondary degree in business administration, accounting, or a comparable discipline. Potential insurance auditors should focus on courses such as insurance law, insurance ethics, accounting, and finance in order to properly prepare themselves for a career in insurance auditing. Computer, marketing, and business-related courses may also be helpful.

For a higher chance of success, develop and/or improve communication and people skills. Students should use their time in school to advance these types of skills through options such as a public speaking course.

Step 2: Gain Work Experience

Since most employers prefer to hire individuals who have experience, prospective insurance auditors should attempt to gain relevant work experience. Insurance agencies, financial firms, accounting firms, underwriting firms, and marketing firms may provide the work experience necessary to gain skills and knowledge in the field.

Become familiar with the various types of insurance policies. Aspiring insurance auditors should take any opportunity to make sure they thoroughly understand any insurance policies and their procedures they come into contact with while gaining experience doing related work.

Step 3: Obtain Certification

While certification is not always required by employers, it may be attractive to many of them. Serious insurance auditors can consider certification through the National Society of Insurance Premium Auditors (NSIPA), which offers two separate insurance premium auditor certifications. The first certification is the Certified Insurance Premium Auditor (CIPA), which requires auditors to possess at least three years of successful insurance auditing experience. The second certification is the Certified Insurance Premium Telephone Auditor (CIPTA). This certification is for insurance auditors who conduct their work over the phone and also requires three years of experience to qualify. There are certain educational and ethical requirements for these certifications as well.

Be sure to satisfy NSIPA qualifications prior to application for certification. Because the NSIPA provides certification to only distinguished candidates, applicants should be sure to meet these considerable qualifications before applying for certification.

Step 4: Complete Continuing Education

Because insurance auditing is an ever-changing industry, it is very important for insurance auditors to stay up-to-date on all changes regarding insurance policies and procedures. By attending classes, seminars, and lectures, insurance auditors will stay current on many aspects of their career, helping to increase their value to their employers. Some employers may also offer continuing education courses on site.

Auditors may also consider returning to school for a master's degree. According to the BLS, the competition in this job market is expected to be competitive in coming years, and those who are certified and have a master's degree will have much better job prospects.

In summary, having a postsecondary degree in business administration or accounting, gaining work experience at a firm or government agency, obtaining certification, and staying up to date with insurance policies and procedures is needed to become an insurance auditor.

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