Commonly Misclassified NCCI Class Codes

Misclassifications can lead to significant financial implications for businesses. Here, we explore some commonly misclassified NCCI class codes and provide comparisons to help clarify their proper usage.

The Hidden Costs of Misclassification in Workers Compensation Insurance

Navigating the complexities of the National Council on Compensation Insurance (NCCI) class codes can be challenging, especially when it comes to ensuring accurate classification for workers compensation insurance. Misclassifications can lead to significant financial implications for businesses. Here, we explore some commonly misclassified NCCI class codes and provide comparisons to help clarify their proper usage.

Carpentry

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Carpentry
5437	5645	5606
Finish Carpentry	Rough Carpentry	Executive Supervisors or Construction Superintendents
Interior carpentry Paneling, molding and cornices Parquet or finished wood flooring Mantels and staircases Cabinets and counters Interior doors and trim Wainscoting and baseboards	Rough framework and rough flooring Siding installation Interior carpentry when structural carpentry is performed by the employer Roof trusses and sheathing Exterior doors and windows Decks and porches	This code covers project managers and construction executives who supervise through superintendents or forepersons and do not have direct charge over workers. If there is no foreman overseeing subcontractors, or if the subcontractor is operating as a sole proprietor with no employees, this code does not apply.
Restrictions
This class code does not include any framing on the jobsite.	This class code is for jobsites with framing and residential dwellings not exceeding three stories.	This code is not applicable if exposure is generated under any construction classification for the same job.
Questions to Ask Yourself If the answer is yes to most of these questions, then your employees' work is likely categorized in this class code.
Does your business primarily involve the installation of cabinets, counters, bookshelves, or interior trim work like molding, cornices, and baseboards? Do you perform specialized carpentry tasks that require skilled craftsmanship, such as installing interior staircases, railings, or finished wooden flooring? Are your operations limited to interior carpentry work without involvement in the complete construction project? Do you avoid exterior carpentry tasks and focus solely on interior finishing work?	Does your business involve constructing residential dwellings, including framing, roofing, and installing doors, windows, and siding, for buildings not exceeding three stories in height? Do you handle all carpentry work for the entire dwelling construction project, including both structural and finishing tasks? Are your projects limited to residential structures like single-family homes, duplexes, and townhouses? Do you also perform carpentry repair or remodeling work on residential dwellings not exceeding three stories in height?	Does your role primarily involve project management, construction supervision, or executive oversight rather than direct hands-on construction work? Do you spend a significant amount of time in the office and visit job sites to confer with superintendents or forepersons about project progress? Is there a layer of supervision (e.g., superintendents or forepersons) between you and the workers at the construction site? Do you exercise supervision indirectly through superintendents or subcontractors rather than having direct charge over the workers?

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Building or Property Management

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Building or Property Management
9012	9015
Building or Property Management (Clerical)	Building or Property Management (Maintenance)
Property managers overseeing daily operations Leasing agents handling rental agreements and tenant relations Clerical staff performing administrative tasks Salespersons involved in property sales and leasing Tenant communication and service requests	Maintenance and repair work on buildings and facilities Security personnel and doormen Elevator operators and gatekeepers
Restrictions
Does not apply to employees performing manual labor or maintenance work, primarily for office-based roles within property management	Not applicable to clerical, sales, or purely administrative roles
Questions to Ask Yourself If the answer is yes to most of these questions, then your employees' work is likely categorized in this class code.
Are the employees primarily involved in clerical or sales tasks? Do the employees manage properties without performing maintenance tasks? Are the employees' duties limited to property management, leasing, and clerical work? Are the employees' tasks primarily administrative and office-based?	Are the employees involved in the care, custody, and maintenance of the premises? Do the employees' roles include tasks such as doormen, janitors, or maintenance workers? Do the employees perform any physical maintenance or repair work on the property? Do the employees handle tasks such as cleaning, landscaping, or general upkeep of the property?

Automotive

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Automotive
7225	8380
Towing	Automotive Repair and Service
Roadside assistance and towing of disabled vehicles Recovery of vehicles from accidents or off-road situations Transporting vehicles to repair shops or impound lots Winching and hoisting operations Use of tow trucks, flatbeds, and other specialized towing equipment	Engine and transmission repairs Brake and muffler repairs Oil changes and tune-ups Tire installation and repair Electrical system diagnostics and repairs Air conditioning and heating system repairs
Restrictions
Does not apply to auto repair or maintenance work performed at a shop, primarily for operations conducted on public roads and highways	Does not apply to towing operations or bodywork, primarily for work performed in a controlled, in-shop environment
Questions to Ask Yourself If the answer is yes to most of these questions, then your employees' work is likely categorized in this class code.
Is the primary activity towing vehicles or providing roadside assistance? Is the work primarily conducted on the roadside or in unpredictable outdoor conditions? Does the business involve vehicle recovery, repossession, or impound lot operations? Do the tasks involve higher risks due to traffic hazards and physical demands of towing?	Are the primary tasks related to minor repairs, servicing, or routine maintenance of vehicles? Is the work environment primarily an indoor service or repair center? Are incidental services like greasing, polishing, and servicing included in the job? Does the business operate a service station or repair center performing routine vehicle maintenance?

Landscaping

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Landscaping
0106	0042
Tree Pruning, Repairing or Trimming	Landscape Gardening & Drivers
Pruning, repairing or trimming trees or hedges using ladders, lifts or by climbing Removal of trees that retain no timber value Clean-up, chipping or removal of debris Stump grinding or removal Tree spraying or fumigating in connection with tree pruning	Laying out grounds and planting trees, shrubs, flowers or lawns Lawn mowing, shrub, bush or hedge trimming Planting operations Maintenance of landscaped areas Pruning, repairing or trimming trees or hedges when none of the operations require elevation
Restrictions
Not applicable to landscaping operations such as lawn mowing or planting	Does not apply to tree removal or any operations requiring elevation, ground crews on tree trimming jobs can be assigned to this code only when no elevation is involved
Questions to Ask Yourself If the answer is yes to most of these questions, then your employees' work is likely categorized in this class code.
Does your business primarily involve pruning, repairing, or trimming trees, including work that requires elevation (using ladders, lifts, or climbing)? Do you provide tree removal services, including the removal of trees that retain no timber value? Are your ground crews involved in tree trimming jobs where the tree trimmers are working at elevated levels? Do you perform stump grinding, debris removal, or tree spraying in connection with tree pruning or trimming?	Does your business focus on landscape gardening, including planting, maintaining gardens, and performing tasks like grass cutting, weed control, and lawn spraying? Are all your operations performed at ground level without the need for elevation? Do you offer landscape construction or installation services, such as installing fountains, garden furniture, or drainage systems? Do you engage in activities like spreading lawn fertilizers, herbicides, or weed abatement for fire hazard control?

Take Action

If you believe your workers compensation policy is classified incorrectly, it's crucial to contact your agent to update the class code. An incorrect classification can lead to overpaying or underpaying premiums, which can significantly impact your business. Updating class codes ensures your policy accurately reflects your business operations, providing appropriate coverage and financial protection.

BerkleyNet is a member of Berkley, whose member insurance companies are rated A+ (Superior), Financial Size Category XV by A.M. Best Company. We provide workers compensation insurance to a wide variety of businesses across the U.S. Our agents and clients use our online tools to easily quote and manage their policies and connect with our team. If an injury does occur, our claim specialists work to get employees back to health and back to work while responsibly managing the cost of claims.

Please note the information in this article should not be construed as legal advice or as a substitute for professional consulting services. This material is for general informational purposes only, and while reasonable care has been utilized in compiling this information, no warranty or representation is made as to accuracy or completeness. For insurance advice, please contact your licensed insurance agent.