Many times on this website, comparisons have been made between the National Council on Compensation Insurance and Workers' Compensation Insurance Rating Bureau rules. NCCI is the rating bureau that covers 41 states, with its headquarters in Boca Raton, Florida. The WCIRB is California's rating bureau.

James Moore

I try to attend as many of the NCCI and WCIRB webinars as possible. Recently, when I listened in on a WCIRB webinar, the presenter said a few times that some of the classification code wordings had become more aligned with NCCI. Having consistent wording between rating bureaus is always a positive development.

Please look closely at these two differences, as each one could involve a large amount of premium if they are misapplied to your WC policies.

Let us cover two of the differences that were uncovered recently: one positive and one possibly positive if the WCIRB follows NCCI’s example.

8871 classification code

I have covered this class code often, as the WCIRB added the code to its manuals over the past year. The code covers telecommuting/telecommuters. The main difference between the NCCI and WCIRB code comes from how much time the employee works in the office.

It's the most important part of the classification code. If more than 50% of the employee’s time is in the office, the correct classification code is 8810 (clerical).

Why does that make a difference? In most states, the 8810 rate is historically lower than the 8871 classification code. The difference may not be that much when comparing the rates. If your company has many telecommuters, then the premium saving could be substantial enough to track office versus home office time.

For the persons that are experienced in WCIRB rules, yes, there is more to the rule; I wanted to keep it as straightforward as possible.

What does that mean for you? Please keep good records on the employees’ times spent in the office versus working in their home office.

COVID-19 claims counting against X-mods

NCCI had long ago indicated that COVID-19-related claims were not going to count against employers’ mods. Kudos should be given to NCCI for making that move from the outset of the pandemic.

I had thought the claims would be placed under a certain classification code. After a bit of research, I found out that the NCCI way of handling coronavirus-related claims was to add in a class code. I was admittedly wrong. Check out how NCCI handled the COVID-19 related claims here.

NCCI used a catastrophe code, not a new classification code.

WCIRB’s recent comments

I had thought that the WCIRB would follow suit and add a CAT code similar to NCCI.  From its website:

The California Insurance Commissioner has approved adoption of the national guidelines consistent with those approved by the Workers Compensation Insurance Organizations (WCIO) for: Nature of Injury: Report “83” (COVID-19); Cause of Injury: Report “83” (Pandemic); Catastrophe Number: Report “12” for all claims directly arising from a diagnosis of COVID-19. These rules apply to reporting COVID-19 claims with accident dates on or after Dec. 1, 2019, and with a required date of reporting on or after Aug. 1, 2020.

It seems that the WCIRB was going to handle the COVID-19 claims similarly to NCCI. Then I read at WorkCompCentral that the WCIRB is mulling the inclusion of the COVID-19 related claims in the X-mods.

Reading the article further, the WCIRB will likely count only claims after Sept. 1, 2022 (whew!).

For a great set of slides on the WCIRB COVID-19 claim statistics, please check out this PDF file. 

What will likely occur is that NCCI and WCIRB will be handling the claims under the CAT code 12 after Sept. 1, 2022.

This blog post is provided by James Moore, AIC, MBA, ChFC, ARM, and is republished with permission from J&L Risk Management Consultants. Visit the full website at www.cutcompcosts.com.