Workers Compensation
Rating Bureaus
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Buried within the fine print
of your Workers Compensation insurance policy is a
provision that states that the insurer will calculate
premium charges based on their manuals filed with
regulators. In actual practice, insurance companies
don't file their own manuals for Workers Compenstion
insurance (although in theory they could.)
Instead, insurers use manuals created by various rating
bureaus. The above map shows which states use the NCCI
as a rating bureau and which states have their own
non-NCCI rating bureaus.
Although rating bureaus are technically independent of
insurance companies, there is a close connection and
working relationship between rating bureaus and the
insurance companies who are the members of those rating
bureaus.
Rating bureaus generally develop the manuals that spell
out how Workers Compensation insurance premiums are to
be calculated, and also create the manual rules that
govern how experience modification factors are
calculated. Rating bureaus also typically operate the
assigned risk plans for states (although WCIRB in
California does not perform this particular rating
bureau function.)
NCCI
The National Council on Compensation Insurance
The Workers' Compensation rating bureau used in most
(but not all states) in the United States. NCCI writes
the manuals of rules that pertain to Workers' Comp
premium computation, classification codes, and
administers many of the Assigned Risk Plans used in
various states.
Their Scopes manual
contains the details of what's intended to be covered by
the various Workers' Comp classification codes You can
order NCCI manuals from their website, including online
access, but these are only available by subscription
(that is, you have to pay to get access to the manuals
that provide the details about how your Workers
Compensation insurance premiums will be calculated.)
WCIRB
Workers Compensation Insurance
Rating Bureau of California
This is the California rating
bureau, which develops manuals and calculates experience
modification factors for employers in California. Unlike
NCCI, WCIRB does not charge for access to their manuals.
There are great similarities in the WCIRB manual rules
as compared to NCCI manuals, but also important
differences in some details. And the formula for
calculating experience modification factors (often
called X-Mods in California) differs significantly from
the formula used by NCCI.
NYCIRB
New York Compensation
Insurance Rating Board
This is the Workers Compensation
insurance rating bureau for New York state. Unlike
WCIRB, NYCIRB coordinates with NCCI for employers
operating both within New York and in other states,
although NYCIRB rules apply within New York.
NJCRIB
New Jersey Compensation
Rating and Inspection Bureau
This is the rating bureau for New
Jersey. Like other rating bureaus, it creates the
manuals of rules that govern Workers Compensation
insurance premiums, including the classification
definitions. NJCRIB also oversees the New Jersey
Assigned Risk Plan and calculates experience mods for
New Jersey employers.
WCRIBMA
Workers Compensation
Rating and Inspection Bureau of Massachusets
The rating bureau for
Massachusets. Responsible for manuals that govern
premiums and classification definitions within MA and
calculates experience modification factors for employers
within the state. Coordinates rating data with NCCI for
experience modifiers of employers that operate within
both MA and states that use NCCI.
DCRB and PCRB
Delaware Compensation
Rating Bureau and Pennsylvania Rating Bureau
These two states
operate their own independent rating bureaus that share
their own unique classification system that is
significantly different than the one used in other
states.
These rating bureaus do not coordinate rating data with
NCCI, which means that separate experience modifiers are
developed for employers within these states, even if
those employers also operate in NCCI jurisdictions.
NCRB
North Carolina Rating
Bureau
Another independent,
non-NCCI rating bureau.
North
Carolina promulgates its own in-state experience mods,
but also reports data to NCCI for use in interstate
mods.
NCRB performs inspections to
determine correct classifications for NC employers and
administers the assigned risk plan for NC but uses NCCI
manuals.
CAOM
Compensation Advisory
Oganization of Michigan
Michigan is also not an NCCI state, but maintains its
own separate independent rating organization -- the
Compensation Advisory Organization of Michigan, or CAOM
-- with an important caveat: in Michigan, there is no
real regulation of classification codes for voluntary
(non-assigned risk) Workers Comp. CAOM only has
classification jurisdiction over policies written
through the assigned risk plan that CAOM administers in
Michigan.
CAOM administers the Michigan Workers Compensation
Placement Authority, which is that state's Assigned Risk
plan. Michigan also calculates its own separate
experience modifier for Michigan exposure, and this mod
is not combinable with other states in an interstate
mod. So an employer operating in both Michigan and in
NCCI states will have two separate experience
modifiers--one just for Michigan, and another for NCCI
states.
WCRB
Wisconsin Compensation
Rating Bureau
Wisconsin also maintains its own non-NCCI rating bureau
for determining classifications, premium computation,
and experience rating. In state experience modifiers are
calculated by this independent bureau, but data is also
provided to NCCI for interstate mods.
ICRB
Indiana Compensation
Rating Bureau
Many people in the insurance business believe that
Indiana is an NCCI state. This is not true.
Indiana maintains its own independent rating bureau, the
Indiana Compensation Rating Bureau. This bureau uses
NCCI for ratemaking, and uses the NCCI Basic Manual, but
does not always follow NCCI classification
interpretations. For some classification codes, the
Indiana rules can be significantly different than NCCI
guidelines. For classification decisions in
Indiana, it's best to talk directly to the ICRB.
MWCIA
Minnesota Workers
Compensation
Insurers Association
Minnesota operates its own rating bureau, the Minnesota
Workers Compensation Insurance Association and like
Michigan, does not regulate what classification codes
insurers use on voluntary market WC business. Unlike
Michigan, however, loss and payroll data is reported to
NCCI for inclusion in interstate mods.
State by State Information
For more information,
take a look at our state by state list of insurance
regulators and regulations.
CompWatch
News and opinions concerning developments in
Workers' Compensation and other lines of commercial
insurance.
Consultants on Workers Comp Classification Codes, Experience Modifiers, Payroll Audits, & More
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