GT Insurance Blog

Insurance problems and cures

Workers Compensation Insurance Classification

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For any size company, it is important to get your Workers Compensation classifications right.

The determinants of Workers Compensation Insurance premium are payroll times rate based on classification times premium modification. It’s important to get all three right. We’ll focus on classification now.

Classifications are set from a list of hundreds of occupations. The list is basically national, with some state variation. The rate for each classification is set state by state. You can’t modify the rate for the classification; you can get the classification right for each kind of work your company does.
There are small common mistakes that can cost almost any company, in addition to the occasional whopper of a mistake.

If you are large enough to have a couple of layers of management, you can keep manager payroll out of high cost classifications.  But if the insurance carrier sees any evidence that the manager ever touches a tool on a job site or spends any time working in a hands on capacity, the carrier is going to dump all that payroll into the highest classification it can.

Call us if you have questions: 1-800-548-2329.  Or go to our Workers Compensation page.

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