Skip to content

Finding and Hiring Industry Experts as Your External Auditor and Tax Preparer

Finding and Hiring Industry Experts as Your External Auditor and Tax Preparer

May 8, 2023


As a teenager, a fun theoretical activity my friends and I occasionally contemplated was pulling up to the drive-thru window of McDonald’s and asking for a Blizzard. Or going to Burger King and asking for a Frosty. Just as certain fast-food establishments serve customized treats, certain CPA firms are more equipped than others to treat your insurance company with the specialized service it requires. How do you determine whether your potential auditors and tax preparers are insurance industry experts? Several factors can aid in selecting the right CPA firm to trust. Some factors may be more subjective and harder to verify, while others are more discernable with a few inquiries.


Internal Factors

There are a few internal characteristics of a firm you can look for when deciding who to trust with your audit and tax return preparation.


Experience working with insurance companies is one of the most basic and desirable traits to look for when choosing an auditor. If an accounting firm has years of experience in the industry, it has had time to notice trends, develop efficiencies, train staff, and more. From the basics of knowing the difference between STAT and GAAP accounting or which tax form an insurance company needs to file to helping you understand your deferred tax asset for loss reserves, CPAs with insurance experience can save you money and unnecessary trouble.


Beyond simple experience, are there insurance specialists within the firm? What is the size of the firm’s insurance team? Do they have just one specialist from an office, or do they have a team of individuals who are trained in insurance accounting? A firm with employees of various levels devoted to serving the insurance industry can be a good indicator of the level of service you can expect. Specialists can help a firm be more proactive rather than reactive.

Knowledge of Rules & Regulations

Working with experienced and specialized auditors and tax preparers can help ensure that your service providers are aware of and up to speed with the latest rules and updates. Certain accounting standards apply differently to insurance companies. The IRS is very specific on what qualifies as an insurance company for tax purposes. You want your auditor and tax preparer to know these intricacies and to be able to discuss them competently with you.

Well-Rounded Service Offerings

A CPA firm that is really committed to an industry will have specialists in more than one service area. Does the firm offer audit, tax, consulting, accounting services, and data analytics to insurance companies? Firms that are well-rounded in service offerings for this specialized industry are usually great resources for insurance companies, as they can spot areas in which you may need assistance that you may not associate with an audit or tax return.


External Factors

Another way to gauge a firm’s expertise in the industry is to inquire about connections to, involvement with, and reputation among the insurance industry.

Resources & Connections

A firm that belongs to various trade associations and industry groups is more likely to have a solid network of support. When you inevitably run into a unique problem or situation that is beyond the firm’s experience, the firm’s connection to leaders in the industry can help you get prompt and creative solutions. Education companies and highly specialized firms are great resources your auditors and tax preparers can reach out to in those instances.

Industry Involvement & Commitment

Another question to ask when considering a proposal is what conferences and tradeshows does the firm attend, or even sponsor? Does the firm present as subject matter experts at such events? Does the firm have a presence at other industry events that you attend? This type of commitment demonstrates that the firm cares about the insurance industry at large and wants to stay on top of industry updates. Such involvement can indicate the value that firm will place on working closely with you and serving your needs.

Sharing Knowledge

You can also check a firm’s social media profiles to see if it is sharing industry updates and writing about insurance company questions and needs. A CPA firm may have resources on its website to support learning in the insurance industry that can help train your staff. If a firm really knows the industry, that firm’s experts will be comfortable sharing that knowledge with you and proactively helping you understand changes in the industry before they take effect.


You can also find out about the reputation of a particular firm from others involved in the same organizations or associations. How many other insurance companies does that firm audit, and what has been their experience? Does the firm supply references or testimonials from other clients? Typically, if a firm is auditing or providing tax services to more than a handful of clients, you can trust that firm will be a reliable provider for your company.

Compliance and accurate representation of your financial position is crucial to the operation of your insurance company and the service you provide to policyholders and other stakeholders. Thus, the importance to carefully select your auditor and tax preparer. Asking these questions can help you make sure you are working with an insurance expert, giving your company the best foundation for financial compliance.