The Importance of Workers Compensation Code Classification

The National Council on Compensation Insurance (NCCI) currently utilizes over 700 class codes. These four digit codes represent the specific work duties and job classifications assigned to each employee. Code classifications contain detailed descriptions of work and represent the hazards associated within the process of their job duties.

For Example
Class code 8810 is for clerical employee who work at computers. This employee faces less risk of injury compared to a carpenter that performs work on upper stories (class code 5403) because there are less hazards associated with desk jobs than construction of buildings. Because of this difference the workers compensation rates differ from class code to class code.

The Importance
Correctly classifying employees is an important part of the workers compensation insurance quoting and risk management process. If employees are misclassified businesses may end up paying higher rates or risk owing additional premium after an audit. Classification codes are complicated and proper assignment is critical to have the correct premium charged for a workers comp policy.

Every state uses a different set of class codes from various state rating authorities. Each of these codes comes with distinct rating which factors into the premium calculation. With so many class codes to choose from it’s easy to see how misclassification errors can occur.Under state law businesses are obligated to accurately report the duties their employees perform. Improperly coding employees will be discovered during annual insurance audits, and purposefully misrepresenting employees duties can be considered fraud resulting in fines or even prison time.

Help with Workers Compensation Class Codes
When employees roles and duties change their workers compensation class code must also be adjusted. Some carriers allow for employees to split class codes based on their diverse duties but check with your insurance agent before doing so. The NCCI manual can be consulted to find the correct workers comp class codes.

Workers Compensation Insurance can be confusing terrain. Contact one of our agents today for a no cost assessment of your business insurance needs.

4 Ways to Save on Brewery Workers Compensation Insurance

“What are workers compensation rates and where do they actually come from?” is a question we often hear when assisting start-up breweries. Even established brewery owners and managers ask this question. Let’s face it, your job is to make fantastic beer not to understand the nuances of insurance.

Breweries may not know or remember how these costs can be managed or perhaps even decreased to improve profitability. Here are four important steps you can take to lower your workers compensation premiums.

1. Safety is crucial.
Having a brewery safety plan or employee safety training manual is important. Keeping your employees safe and minimizing injuries leads to cost savings over time. Breweries with past employee injuries and claims end up paying higher premiums in subsequent years. There are plenty of resources available to you to make this simple. While OSHA is always a good stop, as are fellow breweries, here is a favorite:

2. Have a return to work program.
No employee should be forced to come back to work prematurely after an injury, but if your brewery has a formal method for having injured workers get the treatment they need to get better, the sooner they can get back on the job. The sooner your employee returns to work the smaller their workers comp claim ends up. We support employees receiving the medical attention and recovery time they need. But a return to work program for your brewery will help you help your employee return in a safe and timely manner.

3. Check what class codes your employees are working under.
If you have employees that do multiple jobs—such as an assistant brewer that also tends bar (I’m guessing you might!), you may be eligible for Labor Distribution, which allows the multi-tasking employee to have their hours at each specific job to be properly attributed. This is essential because a brewer’s workers comp rate is typically triple that of a bartender. You may be overpaying premium based on a small oversight.

4. Ask for pricing help!
If you have been in business for a few years and have little or no losses on your workers’ compensation policy, ask your agent to see what he/she can do to get you a better deal.

Most importantly, we encourage you and your staff to remember the all for one, one for all supportive and typically collaborative nature of the brewing industry. Safer breweries mean fewer work comp claims. Fewer claims means lower rates… for everyone.

If you’re looking for low cost brewery workers compensation insurance click here or contact [email protected]