Class codes, also called classification codes or workers’ comp classification codes, are three- or four-digit codes that insurance companies use to estimate rates. Codes are based on the risks associated with each type of work an employee performs.

What is workers compensation insurance rate?

A workers’ compensation rate is represented as the cost per $100 in payroll. For example: A rate of $1.68 means that a business with $100,000 in payroll would pay $1,680 annually in work comp premiums. A rate of $0.35 means that a business with $100,000 in payroll would pay $350 annually in work comp premiums.

What is the highest workers comp rate?

The highest workers’ comp rates by state jurisdiction are:

• Alaska: $2.25.
• Montana: $1.84.
• California: $1.70.
• Hawaii: $1.67.
• South Carolina: $1.66.
• Idaho: $1.64.

  What does workers compensation code 5606 stand for?

  Workers Compensation Code 5606: Phraseology by state. Such person shall be assigned to the classification which specifically describes the type of construction or erection operation over which they are exercising direct supervisory control provided separate payroll records are maintained for each operation.

  How are class codes assigned for workers comp?

  Workers Compensation Codes consist of a 3-to-4 digit system assigned by either a state rating bureau or the NCCI. Class Codes are used to differentiate various job duties done by employees in an industry. Most of the classification systems contain unique codes which provide premium guidelines for the workers’ compensation insurance.

  Why is a 5606 more expensive than an 8810?

  For example, a 5606 (Contractor) will have more expensive work comp rate than an 8810 (Clerical) employee, because more dangerous work is being performed. The insurance companies will then take all losses accumulated by each class code, and use them to factor a base rate for that type of work.

  What do you need to know about classification 5606?

  Also refer to Part 3, Section IV, Rule 2, Construction or Erection Work. While the classification lists examples of management level employees, such as safety managers, project managers and engineers, who may qualify for assignment to Classification 5606, the classification assignment should be based on each employee’s actual job duties.