Goal of Classification System
The goal is to group employers into categories so that rates reflect the exposures common to those employers. We classify the business of the employer, not the separate employments, occupations, or operations within the business. Each category (classification) includes the various types of labor found in a business. Assign the classification which most closely describes the business.
If the Bureau determines that an insured's class code should change, we make the change effective to the benefit of the employer. See Basic Manual Rule 1.F. Changes in classifications that result in a decrease in premium must be applied retroactively to the inception of the policy. Those which result in an increase in premium are corrected at different times. Here's the rule wording for Basic Manual Rule:
1.F. Changes or Corrections in Classifications
1. Changes in classification due to changes in an employer’s operations will be applied as of the date the change in operations occurred.
2. Corrections in classifications that result in a decrease in premium, whether determined during the policy period or at audit, must be applied retroactively to the inception of the policy.
3. Corrections in classifications that result in an increase in premium must be applied as follows:
If the correction in classification is effective..
Then the correction is applied...
|During the first 120 days of the policy term...
||Retroactively to the inception of the policy.|
|After the first 120 days of the policy term, but before the final 90 days...
||As of the date the company discovers the cause for that correction.|
|During the last 90 days of the policy term...
||Only to a renewal policy, if any.|
Exceptions apply for these types of employers:
construction & erection
temporary labor services
Guidelines for Risks Impacted by Severe Weather and Natural Disasters
Refer to NCCI Circular NCCI FYI-CW-2008-06
The circular addresses the application of classifications and payroll treatment for employees and employers directly affected by weather conditions in locations that have been declared disaster areas by local, state, or federal governmental agencies.