Workman Compensation Policies-Explaining the Classification Codes for these
When we get to the classification system there is for the Workers’ Compensation, this is one system that is laden with some deal of complexities that as a matter of fact has been recognized even by the authorities such as the NCCI, the National Council Compensation Insurance. But this said and done, proper classification is of the greatest significance even as this happens to be so making a big difference in terms of premiums and rates.
For this reason, the NCCI has come up with a whole lot of classification codes, running up to 600 codes, all of which are purposed to cover the workplace. Each of these codes has their own unique rates which are dependent on the risk level and the level of exposure there is in the particular workplace or environment. It is this that explains the reasoning behind the difference in the rates you will find applicable for the various worker categories, such as the rates applied for the clerical workers will be lower as compared to what would be applied for the roofers. Generally, the workplace exposures for these two kinds of employees are certainly different, with the roofer being at a higher risk of getting injured on the job as compared to the chances there are for the office employee.
This said, it is to be noted that there are some instances when such proper classification may not be as direct and clear cut as such bringing lots of complications to the concerned. As a result of this, it is to be noted that there are actually a host of details that indeed go into the determination of the codes that an employer will be assigned and as we have already seen mentioned above, this gets to make a whole world of a difference in the rates and premiums applicable.
One thing that is so far established is that the NCCI gets the classification codes and their definition. But what remains is who it is who really determines the classification codes that will be applicable on an employer’s Workers’ Compensation Insurance Policy. Keep reading for more on these.
To get us going in so far as this goes, it would be wise to first take a look at the roles played by the Insurance Agents and the PEO brokers. Generally, the classification codes would often be suggested by the Insurance Agents or the PEO Brokerage firms who would be offering the workers’ compensation to the concerned employer.