Workers Compensation Class Codes

Beauty Shop, Salon, Spas and Barber Shop

Mitchell Sharp June 9, 2016 No Comments

There are several names or terms referring to businesses in the Salon Industry. They are commonly referred to as as a barber shop, beauty shop, salon or spa. These businesses typically cut, style, trim and color hair. Other services may be offered, such as wig cleaning and styling, massage, nail care, tanning beds and cosmetic consulting. Although salons traditionally catered to women, many are beginning to more commonly offer their services to men. Barber shops for the most part only cater to men.

For workers compensation coverage, the regulations are determined by the states and they can drastically affect what businesses pay in premium. It is important to check with an insurance professional or the state regulating board to make sure you have proper coverage in place for your states regulations. Some of those state regulations attempt to reduce possible spread of disease by requiring each beautician, manicurist or other professional to be licensed. Another factor that determines what the business pays in premium is whether they employ professionals or rent space to independent contractors.

Below are some common Class Codes for Workers Compensation:

9586 Hair Styling, Barber Shop, Beauty Parlor. This is a vary broad classification and applies to most types of personal grooming services for men or women involving all parts of the body. Typical business under this code include beauty parlors, barber shops, tanning salons, day spas, tattoo parlors, make-over salons, etc.

9063 Clubs and Salons- Health and Exercise. This NCCI class code covers many types of spa and club businesses including massage salons, fitness clubs, health clubs, gym’s, and exercise clubs. Also includes YMCA and related organizations.

8018 Beauty Supply Store- Wholesale. Barber and beauty supply houses and wholesale beauty supply sales.

8044 Spa and Hot Tub Dealers. The standard classification for spa, sauna, or hot tub dealers. Includes delivery and installation

9053 State Special Code for CA and NJ. CA- Applies to fitness clubs, swimming clubs, and tennis clubs. NJ- Applies to fitness clubs and health spas.

9055 New York State Code. Applies to most exercise or health clubs in NY.

Retail Stores

Mitchell Sharp June 2, 2016 No Comments

Retail stores, wholesale distributors, warehousing businesses and apparel stores are an enormous part of the economy that make up almost 12% of the entire workers compensation insurance market. Most carriers are willing to quote coverage for this industry, but prices vary considerably between insurance companies. This is because many carriers change their appetite for this industry from year to year based on a number of different factors.

This is common among carriers. Based upon what has happened in certain industries a carrier may deem that industry a better or worse risk. If the carrier deems the risk better they will offer lower premiums in an effort to get businesses in that industry to purchase from them. On the contrary, If a carrier deems your industry to be a higher risk they will raise premium in an effort to recoup what they expect to be claims during the policy period. They may even deny coverage altogether if they determine that your business and your industry is an area where they do not want to risk their book of business.

Retail stores do have a unique set of risks that business owners need to be aware of during their daily operations and when they go to purchase commercial insurance. Especially when you go to purchase workers’ compensation coverage. Retail stores tend to have higher traffic than other businesses. You would think this would cause claims to go up for general liability but not for workers’ comp. Actually it causes claims to be more frequent with employees as well. Employees are exposed to more people which can lead to more frequent and severe sickness like the cold and flu. It also can result in more frequent slips and falls.

Having a well-documented safety program in place is essential for retail stores. It should be an extensive part of the new hire training and it should be done regularly throughout the year with all employees. These do not have to be extensive training programs. They can be as short as a 15 minute conversation or even watching a workplace safety video. They should always be documented and they should occur on a regular basis. The frequency of your meetings is dependent upon your business and the workplace safety expert you consult. It is helpful to create a committee to be in charge of the workplace safety program. This is important because these employees can be supporters of the program and can garner support throughout all employees.

These are extremely important things to put in place for your business because it is the right thing to do for your employees and for your business. When you are doing those things for your business your insurance carrier will notice. It will result in less injured employees, better return to work outcomes and lower rates for workers’ compensation premiums’.

Common Workers Compensation NCCI Class Codes:

• 8044- Furniture Store and Drivers

• 8008- Clothing and Apparel Store

• 8045- Retail Drug Store

• 8017- Store Retail- Not Classified Elsewhere

• 8010- Hardware Store

• 8013- Jewelry Store

• 8046- Auto Parts and Accessories Store

Trucking Companies

Mitchell Sharp May 20, 2016 No Comments

Trucking companies include a vast array of companies and cause the insurance industry to have several different classification codes associated with this industry. From a workers’ compensation perspective, coverage can be hard to find for businesses in the Trucking Industry. If businesses can find coverage, it is expensive in most states. Over the past few years, many national insurance carriers have even quit quoting coverage altogether for long-haul trucking companies. Many other carriers have a limited appetite for short-haul truckers. Other regional carriers can’t provide the coverage required when traveling into other states. For this reason, a few agencies and carriers have found a niche market where they can design affordable target programs for most trucking operations. This can benefit the trucking industry drastically.

Partnering with a nationwide agency is extremely important for long haul trucking companies. Some smaller agencies and carriers are only licensed to offer coverage in a small number of states. If you travel out of their network of states your business may not be covered if your employee is inured in that state.

Jurisdiction in relation to numerous states being involved in a workers comp claim is left up to something called the Walsh Test. The W.A.L.S.H. Test is an acronym to determine which state has jurisdiction. The acronym stands for:

Worked
Accident
Lived
Salaried
Hired

Each letter in the word Walsh has a significance in relation to which states laws are followed when a claim occurs. Where an employee works and where the accident occurs are more relevant to the incident than the fact that the company was hired in one state or that the company offers a salary from their headquarters in another state.

This is just one example of how complex the trucking industry actually is and why it is best to partner with an agency and a carrier who specializes in this industry. They will be able to navigate the intricacies of this industry better than another insurance agency who might specialize in personal insurance lines, but also offers workers’ compensation.

Here is a list of common classification codes used in the Trucking Industry.

7228 – Short Haul Trucking – This class is used for long haulers who transport general merchandise less than 200 miles from their location. This class code applies to sand and gravel haulers, towing companies, as well as dump truck operators.

7229 – Long Haul Trucking – This class code applies to operators than haul general merchandise greater than 200 miles from their principal location. This may include automobile hauling.

7231 – Mail and Package Deliver and Courier Services – The applicable code for companies that deliver and or pickup non-owned packages and messages on a local basis.

7230 – Trucking – Package and Parcel Delivery – This class is utilized for trucking companies who delivery merchandise from retail stores to customers.

7380 – Commercial Drivers, Chauffeurs and Messengers – This class is intended for drivers who are not employed by a public transportation service and do not better fir another class code. This may include delivery by bicycle.

7232 – Contract Trucking – US Postal Service – Applies to mail, parcel and package delivery under contract with the US Postal Service.

Automobile Service Companies

Mitchell Sharp May 13, 2016 No Comments

Auto service companies include a large amount of businesses who provide a wide range of mechanical services for customers. Some may include businesses who offer engine repair, to tune-ups, to even work on electrical components. Other businesses include those businesses who repair vehicle body parts, transmissions or work on brakes. Other operations may include the retail sales of automobile accessories and tools. Some repair shops are a part of a gasoline or diesel fuel sales operation, or are part of an automobile dealership. On the other end of the spectrum, some businesses provide towing services.

As you can see this is a diverse range of businesses that bring about their own unique risks. These risks are different from that of a landscaping company or that of an office setting. From an insurance perspective, each business will require its own unique type and amount of insurance coverage. Here is a typical group of policies that are recommended to this industry.

General Liability
Garage Keepers Liability
Business Personal Property
Hired and Non-owned Auto
Business Income and Expense
Workers’ Compensation

General Liability – GL is required by law in most states and protects your business from both direct damage and indirect damage caused by the actions of your business or employees.

Garage Keepers Liability – According to the International Risk Management Institute, Garage Keepers Liability Coverage provides coverage for automobile and trailer dealers, particularly those dealers that maintain a service department or body shop. This coverage provides protection for liability exposures with respect to damage to a customer’s auto or auto equipment that has been left in the dealer’s care for service or repair.

Business Personal Property – This type of coverage covers buildings, business personal property, and personal property of others for direct loss or damage.

Hired and Non-owned Auto – this type of coverage is commonly added (or endorsed) onto the commercial auto insurance policy. The endorsement adds additional coverages for an automobile accident involving a vehicle they don’t directly insure. This is usually when your employees are driving a rented or leased vehicle as part of their work.

Business Income and Expense Coverage – This coverage takes care of expenses like payroll and lost revenue due to your business having to be closed because of damages incurred as part of a covered loss. This very commonly occurs when a fire occurs to your premises.

Workers’ Compensation Insurance – Workers Compensation Coverage will protect your business and your employees from injuries that occur as part of normal business operations. It provides medical expenses and some lost wages while they are hurt and not able to work. It provides protection from most lawsuits resulting from injuries that occur to employees as part of their normal work environment.

Below are some common classification codes for Auto Service Businesses in relation to Workers’ Compensation Insurance.

8380 Auto Service and Repair Centers. This is a broad code and typically applies to service stations and gas stations that perform repair or service work. This includes batteries, tires, oil changes, tune-ups, transmission work, etc. This class also includes specialty shops such as muffler shops and brake repair. Code 8380 also applies to employees working for new and used auto dealers and includes mechanics, parts, and service writers. Additional types of auto shops associated with this code include tire dealers. car washes, glass replacement, and window tinting.

8393 Auto Body Repair. This code is applicable for the body repair of automobiles using metal, fiberglass, and plastics. This classification includes upholstering and painting, and dent repair. Paint only operations typically fall under class code 9505- Auto Painting

8748 Auto Sales and Dealers. Applies to sales people employed by new and used care dealerships. This class also includes salespeople for boat and outboard engine dealerships. Not applicable to MA or TX.

8398 Auto Sales or Service Agency- Service, Parts, and Drivers. Applies only in NJ

8046 Auto Parts Stores Including Drivers. This class applies to both retail and wholesale auto parts and accessory stores and delivery drivers. It also includes salvage yard employees who do not work in the yard. N/A in MN and TX.

3821 Auto Recycling and Drivers. Applies to savage yard operations and includes dismantling of all types of automobiles. N/A in IN, MA, MN, and TX

3632 Auto Machine Shops. Applies top operations whereas parts are manufactured, fabricated, or rebuild while not attached to any vehicle. This code includes the repair of engines, inboard/outboard motors, and small engine repair.

Day Care Centers

Mitchell Sharp May 6, 2016 No Comments

Child care costs are devastatingly high for parents. One main cause for that is because of the cost for these businesses to purchase commercial insurance. The reason for such high premiums is because of both the frequency and severity of claims in this industry. When a child is involved in an industry it brings an element to the industry that adds emotion. Because of that emotion, lawsuits become more frequent. Regardless of whether the lawsuits are founded or not the legal fees can still rack up to a hefty amount. Because of this fact, carriers tend to change their appetite for quoting daycare centers frequently. This can change what a carrier charges for premium drastically from year to year, which make it difficult for employers to know if they are getting a good deal on their policy.

Carriers appetite for this industry changes frequently because of the claims history involved and the uniqueness of this industry. The risks of a day care center are dramatically different compared to the risks of cleaning company or a medical office. If one carrier has a year or a couple of years where their claims history has a higher frequency or larger than normal severity they may change what they charge for premium in this industry. This change in price may have nothing to do with you or your business, but rather reflects the carriers overall appetite for quoting this industry.

The good thing is many agencies offer exclusive programs designed for the child care industry. If they are an independent agent, they can usually find programs with several insurance companies. This can help daycare centers find the lowest rates on coverage and prevent large fluctuations in premium. Business owners should speak with their agent about the need to stay with one carrier for the long term. It may be cost effective to switch carriers frequently, but when a claim does occur the carrier is more likely to drop your business from coverage if you do not have a long standing relationship with them. Especially if the claim is a large one. If you have stuck with one carrier for several years, you have adequate training, safety programs and risk management programs in place than that carrier is more likely to work with you when an incident does occur.

Below are some of the NCCI Class Codes Associated with the Daycare industry

8869 Child Care Centers- All Employees. This classification typically includes centers that care for both pre-school and school-aged children. It doesn’t include traditional schools with before and after school care programs. However, this class would include child care centers operated by organizations such as YMCA’s and churches.

7380 Drivers and Chauffeurs. This is a common class code utilized for day care centers with vans or buses for transportation.

8868 College- Professional Employees. Adult day care facilities may utilize this code for day time senior care where there is very limited medical care involved. May also be applicable to learning centers.

9101 College- Other Employees. This code would apply to adult care staff who are not in a professional role or utilizes specialized skills. This may include maintenance, grounds keepers, food service and driving.

Workers’ Compensation Coverage for Non Profit Organizations.

Mitchell Sharp April 28, 2016 No Comments

Non profit organizations include a vast array of specialties. Because of this there are many different classification codes for this industry. This industry can include a soup kitchen, a YMCA, a counseling center and even a halfway house. This does not really even begin to tip the iceberg of the types of organizations that could be classified as a non profit organization. There are also many specific risks that each organization faces. These risks will determine how easy it is for an organization to get proper coverage and how much they pay for that coverage.

Many insurance carriers have restricted coverage for non profits and charitable organization for a number of reasons. Most commonly it is due to historical claims and the organizations dependence on volunteers serving these organizations. Some carriers have designed programs catered specifically to non profits and have created programs with better coverage options and lower prices.

When it comes to purchasing commercial insurance, price is frequently a hurdle for most non profit organizations. For many professionals in this industry the price to pay for coverage seems like a less than ideal way to spend the few dollars the organization has. That is why many carriers have designed programs specifically for these organizations who provide services to their communities, but still take on a large risk in doing so. Because of the populations these organizations serve many do take on a fairly high amount of risk.

According to Volunteer Alive, a leading voice in the non- profit industry, the recommended coverages in addition to workers comp are General Liability, Professional Liability (especially if offering counseling services), Volunteer Liability, Directors and Officers Liability, Commercial Auto and Hired and Non-owned Auto Insurance Coverage. Each of these coverages depends on the type and scope of the work the organization partakes in and the type of clients the organization serves.

Below are the classification codes designed specifically for Non Profit Organizations

8864 Social Services Organizations: This classification code is applicable for organizations that provide social services to mentally, physically and emotionally challenged individuals. It also applies to organizations who provide services to troubled youth, abuse victims and drug related activity. Services may include meals, counseling, case management, education, employment, training and very limited medical services.

8842 Group Homes: This classification code includes facilities with overnight stays and applies to most group homes, rescue missions, temporary shelters, independent supportive living as well as training centers for mentally, physically or emotionally handicapped clients.

7720 Juvenile Detention Centers: This classification code includes halfway houses, boot camps, homes for convicts and correction facilities.

8742 Social Services Professionals: This is the common classification code for organizations providing adoption services, community outreach and foster care placement.

8833 Hospital Professionals: This classification code is designed specifically for those organizations that interact in medical services including drug and alcohol treatment, detoxification, batered women’s shelters, convalescent homes and respite services.

9040 Hospitals – Non Professional (Non-medical). Applies to similar organizations as 8833 except the employee is not medically trained. An example of this would be maintenance, laundry and food service workers.

8837 Charitable and Welfare Organizations – MA, TX, WI Includes organizations that collect, recondition and sale items in stores.

8861 Charitable Welfare Organizations – MO, NV, VA Applies to most organizations that provide charitable or welfare assistance to the needy, challenged or abused. Organizations may provide accomodations, meals, counseling, etc. This classification code may include residential mental health facilities, residential care, community food service, shelters and vocational rehabilitation services.

9063 YMCA, YWCA, YMHA and YWHA institutions.

Lawn Care and Landscaping

Mitchell Sharp April 20, 2016 No Comments

The Lawn Care and Landscaping industry has many different risks associated with the work that is done by businesses in this industry. Each risk that is taken on can change what a business pays for commercial insurance, specially for workers’ compensation coverage. Like many industries, there are several different classification codes for lawn care and landscaping. The classification codes are determined by the National Council on Compensation Insurance (NCCI). These classification codes separate businesses by the type of work they do or do not partake in. That is because of the diversified scope of activities a business can be involved in. For this industry there are a diverse group of businesses that operate and each carries its own unique risks.

This industry includes businesses who simply cut grass, but it also includes businesses who climb 50 in the air with a chain saw to work on trees. It includes businesses that maintain the grounds of an athletic field, businesses that manage cemetery properties and businesses who manage plants in a greenhouse. As you can see, there are many different levels of risk among each of these businesses. Most businesses operate somewhere in the middle of these risks. That is why it is very important for businesses to take a little extra time when purchasing commercial insurance. Take this time to speak open and honestly with an insurance agent about exactly what the business does and does not do on a daily basis. This conversation will prevent two main things: one is to properly classify your business and two is to prevent gaps in your coverage.

On the first point it is crucially important to properly classify your business. If you only cut grass and your agent puts you in a classification code that trims trees high in the air, you will pay far more in premium than is necessary. This usually gets fixed during an end of term audit, but even if it does get refunded it still means you have tied up cash in premium that could be used towards something more beneficial to your business. On the second point, speaking long and hard with your agent will prevent gaps in your coverage where you are not covered. Two common coverages businesses need, but frequently do not purchase are business loss of income coverage and data breach insurance. These conversations can help you determine if you do or do not need this coverage. It is best to determine this long before a claim occurs.

Now in addition to these conversations there are certain coverages that are recommended for all businesses operating in this industry. Those coverages are:

General Liability Insurance
Inland Marine Coverage
Property Insurance
Commercial Auto Insurance
Workers’ Compensation

General Liability and Workers’ Compensation are required by law in most states. General Liability covers your liability to third parties where workers comp covers injuries that occur to your employees. Commercial Property Coverage could range from one small building where you store your vehicles and equipment or it can be as vast as covering an entire nursery. Inland marine coverage is usually an addition to a commercial property policy and it is a specialized form of insurance form tools and equipment. It is commonly referred to as ‘equipment coverage’ or ‘floaters‘. That is because the equipment is frequently in transit. In the lawn care and landscape business this would cover all of the equipment your employees take to the properties you are working on. Commercial Auto Coverage can be small depending on if the vehicles are used for maintenance only and they do not supply or transport plants. It can become quite extensive if your business transports plants and other equipment.

Other coverages may be needed depending on the business and the level of risk a business owner is comfortable taking. Taking extra time to speak open and honestly with your insurance agent can go a long way towards making sure you are in the proper classification code and that your business is fully covered for the risks you are taking.

Here are a majority of the classification codes included in the Lawn Care and Landscaping Industry. Each state has its own classification method. Most use NCCI, but some use other standards or they have their own. Check with your state governing board or ask your independent agent when you are attempting to be properly classified.

Business Liability Category: Artisan Contractors

SIC Business Insurance Codes:

• 0781- Landscaping and Planning

• 0782- Lawn and Garden Services

NAICS Liability Classifications:

• 541320- Landscaper Architectural Services

• 561730- Landscape Services

Business ISO General Liability:

• Code: 97047- Landscape Gardening

• Code: 97050- Lawn Care Services

Common Workers Compensation Class Codes:

• 0042 – Landscapers and Drivers

• 9102 – Park Maintenance, Lawn Care, and Drivers

• 0106 – Tree Pruning or Spraying

• 9182 – This is a specific class code related to the maintenance of athletic parks.• 9220 – Cemetery operations perform similar work as many of these codes.• 9016 – Many specialized park operations utilize this classification those parks include amusement parks, ranges, arenas, concessions, golf, boat rentals, racing, rodeos, tracks, and zoos.

Commercial and Residential Cleaning Companies

Mitchell Sharp April 7, 2016 No Comments

Commercial and Residential Cleaning Companies are very similar businesses, but from an insurance perspective there is one critical difference. The difference is the driving aspect of Residential Cleaning Companies. Businesses in this industry, that work with residential clients as opposed to commercial clients, typically have employees who are traveling to 2 or more locations throughout the work day. Commercial Cleaning Companies typically have their employees work at only one business or location, like a mall. The time that the employee spends driving in-between locations is time that the business is liable for injuries that may occur. This is because the only reason the person is on their way or at the location where the injury occurred is because of the activities of the business. This risk increases the frequency of claims and the severity of those claims when they do happen.

Safety programs are one aspect that can determine the price for Workers Compensation Premium in both of these industries. If there is a well-documented safety program in place than agents can use that to negotiate deeper credits and discounts on your policy. Also, this is is an industry that tends to have a lot of small claims. Constantly bending puts the back at risk and slips and falls are common. When too many claims occur in one particular term it can cause your insurance carrier to raise your premium or drop you from coverage altogether. This can be very bad for your business. Higher premium takes money out of the business and puts it into larger insurance costs. If you are dropped from coverage by your carrier it makes it more difficult to get another carrier to quote your business and they will not be very hungry to offer discounts or credits. If you fail to secure coverage on the open market you are forced to buy coverage from the state provider also known as the pool. Depending upon your states’ policies once you are in the pool you must stay in the poll for a minimum of three years. Policies in the pool are considerably more expensive than policies on the open market. If you have a well-documented safety program in place this your insurance agent can negotiate on your behalf to keep you out of the pool. If you have no plan in place it may show the carrier that you are a risk to great for them to take.

The type of chemicals used in your operations can determine how much risk your business has. Those businesses that offer or predominantly use environmentally safe chemicals typically have less claims and can more easily negotiate larger credits and discounts. This also comes in handy when accidents occur and you are in danger of being dropped by the carrier. again, in this case the agent can go to the carrier and show what chemicals you are using and how you are trying to limit the damage to your employees and to your business.

The basic package of coverages recommended for businesses in the industry include:

✓ General Liability Insurance
✓ Business Personal Property
✓ Hired and Non-Owned Auto
✓ Workers Compensation Insurance
✓ Commercial Crime / Employee Dishonesty
✓ Inland Marine Coverage

These are just the basic coverages recommended. There are other coverages that may be needed depending upon the size and scope of your business.

SIC Business Insurance Codes:

• 7349- Building Cleaning and Maintenance Services

NAICS Liability Classifications:

• 561720- Janitorial Services

• 561210- Facilities Support Services

• 561790- Other Services to Building and Dwellings

Business ISO General Liability:

• Code: 96816- Janitorial Services

Common Workers Compensation Class Codes:

• 9014- Janitorial Services by Contractors- No Window Cleaning Above Ground Floor

• 9170- Janitorial Services by Contractors- includes window cleaning above ground level. This class is similar in most aspects to class code 9014, however, it specifically inldudes the inside and outside cleaning of windows above ground.• 9008- Janitorial Services by Contractors- California only. This is a state special class code and applies to to similar operations indicated above.• 0917- Residential Cleaning Services- This classification is applicable to businesses that provide residential cleaning services inside of a customer’s residence. Cleaning services should be internal in nature and may include tasks such as dusting, mopping, vacuuming, and sanitizing. Typical workers would inlclude house cleaners, cooks, laundry workers, maids, butlers, and nannies.

Home Health Care and Assisted Living Facilities

Mitchell Sharp March 31, 2016 No Comments

Home health care agencies provide services that are crucial to many people towards the end of their life. With the Baby Boomer generation getting older with each passing year, the need for these services will only continue to grow. With that growth will come increased need for these businesses to protect themselves through a strong Commercial Insurance Policy.

Home health care agencies may differ in scope from general assistance to highly skilled nursing services. Depending on the extent of the work there are a number of policies each business will need to secure in order to fully protect the business. Most home health care businesses will need the following insurance:

General Liability
Workers’ Compensation
Professional Liability
Business Personal Property
Hired and Non-owned Auto Insurance
Commercial Crime

General Liability covers damages to the premise of the client and bodily injuries that occur as a part of normal business operations. Workers’ Compensation is required by law in most states and is the ‘exclusive remedy’ for injuries to your employees that occur as part of your normal business procedures. It provides medical care and some lost wages for injured employees and it provides your business with protection from lawsuits because of injuries that happen as part of normal business. Professional Liability may or may not be needed depending upon the scope of the services you provide. If nurses are receiving directions from doctors and administering medicines than this policy is definitely needed. Business Personal Property Coverage covers the personal property of your employees while they are on the job but located at the residence of the client. Hired and Non-owned Auto Coverage is for the driving exposure when your employees are driving to the clients residence or if they are driving between the residences’ of more than one client throughout the day. Commercial Crime covers your business for any incident of employee dishonesty. The fact that your clients in most cases are older in age, puts the at risk to be victims of identity theft or elderly financial abuse. Commercial Crime Coverage will limit the exposure of your business should one of your employees commit a crime while representing your business.

Here are several of the most common used classification codes for home health care and assisted living businesses.

Business Liability Category: Health Care Providers

SIC Business Insurance Codes:

• 8082- Home Health Care Services

NAICS Liability Classifications:

• 621610- Home Health Care Agencies and Services

• 532291- Home Health Equipment Rental

Business ISO General Liability:

• Code: 44500- Home Health Care Services (non-profit)

• Code: 44501- Home Health Care Services (for profit)

Common Workers Compensation Class Codes:

• 8835 – Home Health Care- All Employees

• 8829 – Nursing Homes and Assisted Living Facilities

• 8824 – Healthcare Employees a Retirement Living Centers

• 8825 – In CA, MA, NJ, NY and TX Applies to food service employees at retirement living centers.

• 8826 – In CA, NJ, NY and TX Applies to all employees of a retirement living center who are not health or food related.

• 8827 – California Exception Code. Applies to home healthcare medical professionals providing services in clients homes.

Bars, Taverns and Restaurants

Mitchell Sharp March 24, 2016 No Comments

Bars, Taverns and Restaurants have many different risks they face. The differences between a food truck, a four star restaurant and a diner are as different as the differences between a florist, a gun club, and a dry cleaners.

Many of these different risks cause a bar tavern or restaurant to be classified very differently depending on their operations. These risks go a long way towards determining which classification code a business is placed in. Which classification code the business is classified in is a large part of what determines how much they pay for commercial insurance. Limiting these risks before they turn in to insurance claims can save your business immensely over the long term.

Most states determine if a business is a restaurant (not a bar or tavern) if it makes a certain percentage of its revenue from food and not alcohol sales. Typically that amount is 50%. If the business makes more than 50% of its revenue from alcohol sales it is in a riskier classification code and is charged a higher premium for commercial insurance.

Separate from the percentage of alcohol sales a business makes, the first and most obvious risk a restaurant, bar or tavern faces, is if the business offers alcohol or not. If the business does offer alcohol, does the business offer hard alcohol or just beer and wine. After alcohol consumption the next risk is how late the business is open. You can imagine the difference in risks between a diner open from 5:00 AM – 2:00 PM, a restaurant that closes at 8:00 PM and a bar that serves no food and stays open until 2:00 AM. The latter might carry a few more risks that might turn in to insurance claims. Because of this risk the business is going to pay more in premium for their commercial insurance.

Most insurance carriers recommend a certain amount of insurance coverage for businesses in this industry those coverages include:

General Liability
Liquor Liability
Commercial Property
Business Personal Property
Workers Compensation
Business Income and Expense Coverage
Commercial Crime Coverage
Umbrella Coverage

General Liability will cover the business for slips and falls that happen on the property, Liquor Liability Is required by law in most states and the amount of coverage is usually determined by the amount and type of alcohol you serve. Commercial Property Insurance covers damages to the building and most fixtures attached to the building. Workers’ Compensation is required by law in nearly every state and is coverage to prevent lawsuits for injuries that occur to your employees as part of normal business operations. Business Income and Expense Coverage is an addition to a Commercial Property Policy and will cover your business for loss of revenue due to being closed after damage to your premises. Commercial Crime Coverage will cover your business for crimes committed by your employees while acting on behalf of the company. Umbrella Coverage is designed to extend the limits of existing policies when those limits have been met. It is important to note that Umbrella Policies only kick in on top of other existing policies. If the cause of the damage is not a covered peril than the Umbrella Policy will not be activated.

Below is a list of all the classification codes that might be included as a Restaurant, Bar or Tavern.

• Code: 16930- Restaurant- alcohol sales >75%- Table service, no dance floor

• Code: 16931- Restaurant- alcohol sales >75%- No table service, no dance floor

• Code: 16940- Restaurant- alcohol sales >75%- Bar service only, with dance floor

• Code: 16941- Restaurant- alcohol sales >75%- Bar service only, no dance floor

NCCI Class Codes:

9082 – Traditional Restaurant.
9083 – Fast Food Restaurant
9084 – Restaurant who receives more than 50% of their revenue from the sale of alcohol.
9058 – Restaurants owned or operated in a hotel.
9053 – CA, NJ and OK includes employees located in clubs like swimming, tennis or fitness.
9079 – CA, MA, NJ, OR or TX depending on the st applies to vending, dance halls and hotels.
9072 – Applies to NY only. Includes fast food restaurants.
9071 – Applies only to NY. Full service restaurants, buffets, diners and other establishments that include wait service. May include musicians.