Understanding Workers Compensation for Architects/Engineers Firms
The workers compensation policy can be complicated but once you understand how it works it can become easier to comprehend.
There are six standard parts of the workers compensation policy. Part one pays for bodily injury by accident or disease of employees. Part two is the employers’ liability portion that pays for claims brought by third parties. Part three provides coverage in other states, other than your firm’s domiciled state. Part four are the duties of your firm to report any and all claims promptly. Part five explains that the premium on the renewal is an estimate. Part six are other conditions such as cancellation of a policy.
The sections stated above are the different portions of the policy. There are other parts of the policy that are important to understand. The class codes are the basic job description of each employee at the firm. For example, an architect class code is 8601 and clerical staff is 8603. This code determines a rating basis for employees. With the class code the remuneration (salaries) of each employee that are included with each class code. This is the basis of premium for the workers compensation policy.
Another crucial part of the policy that your firm should know about is the worker compensation audit. When the policy is set up the premium is an estimate based on the salaries employees at that time. At the end of the policy period your firm will be asked to completed audit paperwork. The reason for the request is to acquire the actual salaries from the past policy period. The actual salaries may be higher or lower than what was estimated on the renewal. It is important your firm completes the audit paperwork. If your firm does not provide the requested audit paperwork there will be an estimated audit completed by the insurance company.
Workers Compensation policy is to protect your firm and your firms employees due to injuries. Be sure you read and understand your policy. If you have any questions please call or email your Professional Underwriter agent.