2021 Most Reclassified Class Codes – NCCI Releases New Report
One of the reports that I watch for each year from NCCI is the most reclassified class codes from the prior year(s). Check out this article on NCCI’s Reclassified Class Codes for 2020.
Some readers may find this article boring – until the surprising premium audit bill arrives with a 10-day payment deadline.
The list itself has not changed that much over the last few years. The rankings in the list have changed every year. Below is a graphic of the list. Check out the NCCI article here.
2021 Top 10 Rankings – Most Reclassified Class Codes
Governing Class Code vs. Individual Employee Reclassification
One question that J&L has received often over the years is – What is a Governing Class Code? The NCCI article covers governing classification codes. I will use the definition from the article:
The governing code, as defined in NCCI’s Basic Manual for Workers Compensation and Employers Liability Insurance (Basic Manual), is the basic classification at a specific job or location (other than a standard exception code) that produces the greatest amount of payroll. If a change to a policyholder’s governing class code occurs (as documented on an NCCI Inspection & Classification Report), then the governing code is considered reclassified.
The governing class code change refers to a company-wide change, not just a premium auditor moving a few employees from one class code to another. If your company is moved to a more expensive governing class code, the results can be a huge premium increase from the prior year.
Which Codes Does J&L See Changing the Most?
The Store classification codes generate the most Governing Class Code questions that we have received since we have been in business. The questions were not specific to NCCI. The WCIRB (California) also generates many questions with their interpretation of the Store codes.
On an individual employee basis, we used to see the 8810 Class Code changing to another code quite often. Premium auditors have become very adept at spotting employees that should not have a Clerical Classification.
Workers Comp – like many industries has its own set of acronyms and terms to decipher. Check out our article from last week where we recommended NCCI’s free micro-learning (1-minute) video library.