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An Overview of What Workers’ Compensation Classification Codes Entails
When we come to the classification of the workers’ compensation system, this is one that is seen to be with lots and lots of complexities and this is one fact that is even acknowledged by the National Council Compensation Insurance, NCCI. This be as it is, one thing that remains a need is that of proper classification considering the fact that this is one of the things that happens to be having such an impact on the rates and premiums going forward.
Given this, the NCCI has as such come up with up to 600 classification codes for workers’ compensation and these are all intended to help with the need to cover the workplace. By and large, each and every one of these codes will have their unique rates and these are dependent on the exposure rate and the risk level there is in the concerned work settings or environments. Thus, you shouldn’t be surprised to realize that there will be a much lower rate for the clerical worker as compared to that applicable for the roofer. 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.
We already know the fact that it is the NCCI that is tasked with the provision of the classification codes and the definition of the same. But this be as it is, one thing that is still not yet established and clear to as many is who it is who will actually determine the classification codes that will actually be used on an employer’s Workers’ Comp Insurance Policy anyway. Read on and learn more below.
To begin with, it is important to know of the roles played by the Insurance Agents and the PEO Brokers. It is often the case that you will first have the classification codes suggested to you by the Insurance Agents or the PEO Brokerage firms who would be selling to you the workers’ compensation as an employer.