Making Sense of 600 Separate Classifications.

All state fund employers have one thing in common - each is assigned an exposure classification (Manual Classification) based upon the National Council on the Compensation Insurance Rating System. According to their theory, an employer with a construction exposure should have a higher rate than an employer whose employees work in an office environment.

 

The problems with a rating system that has over 600 separate classifications, however, are many:

 

• Is your company properly classified?  If you are not properly classified, you are either overpaying or underpaying premiums. The good news is that if you are underpaying, you can request a retrospective audit, and the OBWC will reimburse two years overpayment. The bad news is that if you are underpaying, the OBWC has the right to go back two years.

 

• Even if your classifications are correct, can you confirm that all employees in your work environment are being properly assigned to the appropriate manuals?  The underwriting standards used by the OBWC call for strict compliance and anyone with any level of exposure to a higher classification must be placed in that classification. For example, an industrial engineer that works in a manufacturing plant, however infrequently, should be classified within the manufacturing classification.

 

Our Workers' Compensation team can assist you with proper classification. Contact us for details.