Comp manual tweaks could change some ratemaking classifications

The National Council on Compensation Insurance Inc. has proposed two revisions to its basic manual that change some classifications because they provide insufficient data to use for ratemaking and loss costs in Texas.

One change to classifications in Item B-1431 in the NCCI's Basic Manual for Workers Compensation and Employers Liability Insurance eliminates certain classifications that have low credibility in Texas and reassigns any associated exposures to classifications with similar operations, according to the Texas Department of Insurance website. A classification with limited premium has low credibility, and the loss cost for the classification can be volatile, the NCCI said in a proposal submitted Friday.

The other proposed change to Item 01-TX-2016 eliminates the A-rating process for certain national and state special classification and statistical codes in Texas. Also proposed is the elimination of the A-rated Texas special classifications for chemical manufacturing operations and domestic workers in NCCI's basic manual.

The changes are for new and renewal policies with effective dates on and after July 1, 2017, according to the Texas Department of Insurance website.

Boca Raton, Florida-based NCCI, a nationwide workers comp ratings and research organization, is the comp rating agency for 39 states and the District of Columbia. The Texas Department of Insurance adopted NCCI's basic manual, which includes classification codes and endorsements for workers comp policies.