Frequently Asked Questions

 

GENERAL:

 

UNDERWRITING:

 

CONSTRUCTION CLASSIFICATION PREMIUM ADJUSTMENT PROGRAM (CPAP):

 

FIELD SERVICES:

 

ACTUARIAL:

 

DATA REPORTING:

 

GENERAL:

What is the difference between the New York Compensation Insurance Rating Board (Rating Board) and the Workers' Compensation Board?
The Rating Board is a private unincorporated association of insurance carriers responsible for the collection of workers compensation data and the development of workers compensation loss costs and rules regarding the proper application of these rates to workers compensation policies. The Rating Board also administers various individual risk rating plans such as the Experience Rating Plan and the Retrospective Rating Plan.
The Workers' Compensation Board is a state agency responsible for the administration of the workers compensation system which includes the adjudication and handling of workers compensation claims. Claimants in need of information concerning their workers compensation claim should contact the Workers' Compensation Board at (800) 580-6665.

How can one obtain copies of Rating Board Manuals?
Rating Board Manuals are available for download from this website.  Manuals are provided in Adobe PDF format.  To access this section of the website, click here for NYCIRB Manuals.

How can one obtain copies of the Medical Fee Schedules and the Regional
Conversion Factors?
The Official New York Workers' Compensation Medical Fee Schedule may be examined at the office of the Department of State, 162 Washington Ave., Albany, NY 12231, the Legislative Library, the libraries of the New York State Supreme Court, and the district offices of the Workers' Compensation Board in Albany, Binghamton, Brooklyn, Buffalo, Hauppauge, Hempstead, Manhattan, Peekskill, Queens, Rochester and Syracuse. Copies may be purchased from Ingenix, by writing to the New York Workers' Compensation Medical Fee Schedule, c/o Ingenix, PO Box 27116, Salt Lake City, UT 84127-0116, or by telephone at 1-877-464-3649.

What is the procedure followed by a licensed carrier to become a member of the Rating Board?
Information on becoming a member of the Rating Board can be obtained by either calling or writing to the Rating Board's Vice President, Finance and Administration at (212) 697-3535, ext 115. A packet will then be sent to the carrier explaining the procedures for joining the Rating Board as well as samples of the necessary paperwork to be completed.


UNDERWRITING:

How can one obtain copies of the Rating Board's Master Alphabetical Classification Index (MACI)?
Rating Board’s MACI Manual is available for download from this website.  The MACI is provided in Adobe PDF format.  To access this section of the website, click here for the MACI Manual.
For information regarding the purchase of Rating Board’s MACI, please contact the Rating Board's Accounting Department at (212) 697-3535, Ext 152 or 153.

What is a Rating Board Combinable ID and Coverage ID?
The Rating Board Combinable ID is a nine-digit number used to identify an entity or a group of entities combined for experience rating purposes.  Each entity under the Combinable ID is assigned a separate seven-digit Coverage ID.  If an employer is not combined for experience rating, both a Combinable ID and Coverage ID are assigned to the individual employer.

What is a Letter ID?
Most correspondence generated from the Rating Board’s processing system will display a Letter ID at the bottom of the document.  When referencing correspondence received from the Rating Board, the use of this identifier provides speedier retrieval of the individual file.

When are individuals, such as independent contractors, included or excluded for coverage under an insured's policy?
The Rating Board, in its capacity as a data collection and statistical organization, cannot make binding legal determinations regarding the status of individuals under the Workers' Compensation Law. Only the Workers' Compensation Board (WCB) or a court of competent jurisdiction is empowered to make such rulings.  Direction and control of the work performed is one criterion used by the WCB when it considers whether an employer/employee relationship exists. Using this criterion an individual could be considered either an employee or an independent contractor.
If an individual provides his/her own materials to complete a job, they are probably acting in the capacity of an independent contractor. If the materials, however, are provided by the insured, the insured has the right, whether it exercises it or not, to direct how the materials are used.
The courts have considered other criteria such as the method of payment to the individual, whether by lump sum or an amount determined by the hour, day or week. Additional consideration is given to the actual work performed (skilled or non-skilled), whether it should carry its own accident burden, its relationship to the insured's business, if it was part of the insured's normal work, whether the work performed was continuous or intermittent and whether the length of time to complete the work was sufficient to the hiring of an employee to perform the work.
When questions arise concerning employer/employee relationships, the Rating Board provides advisory statements concerning some of the criteria used but informs the inquiring party the advisory information received from the Rating Board is not legally binding.

Can an executive officer be excluded from workers compensation insurance coverage?
The New York Workers' Compensation Law (WCL) currently states that corporations with one or two executive officers, with no other employees requiring coverage, are not required to obtain coverage.
If a corporation with one or two executive officers has employees requiring coverage under the WCL, either one or both of the officers may elect to be excluded from coverage providing the one or two officers own all of the issued and outstanding stock, with each owning at least one share, and hold all executive officer positions.
If a corporation has three or more executive officers, including inactive executive officers, coverage under the WCL is mandatory.

When a change in rate occurs during an insured's policy term, do the new rates apply?
When a workers compensation insurance policy is written, the rate in effect at the inception of the policy applies for the full term of the policy, generally a twelve-month period. The only time that a different rate may apply is if the anniversary rating date (the date the experience modification is effective) and the policy inception date differ. The rates in effect prior to, and after, the anniversary rating date each apply to the policy. The rates in effect prior to, and after, the anniversary date apply to their respective exposures for the two time periods.
If a policy is canceled and rewritten, the rates that applied to the canceled policy apply until the expiration date of the original policy. The purpose of this rule is to discourage insureds from requesting to have their policies canceled to take advantage of a lower rate and to also discourage insurance carriers from canceling policies and charging additional premiums when an increase in rate occurs during a policy period.

How is a disagreement between the Rating Board and an insured concerning a specific classification, policy rule or procedure resolved?
Refer to Rule M under the Administrative Rules and Procedures section of the New York Workers Compensation and Employers Liability Manual for a complete explanation of the Board’s Appeals Process.

If I do not agree with the classification my insurance carrier has assigned to my business, what can I do?
You can write directly to the Underwriting Department providing a detailed description of your operation(s). A Class Analyst will review the Rating Board's files to see if we inspected your business and authorized a classification. If we do not have an inspection, and we need more information to properly classify your business, we will schedule an inspection of your business or request additional information to determine the correct classification(s).  If we agree with the classification used by your insurance carrier, we explain to you the reason the classification is correct. If we disagree with the classification assigned to your business, we will contact the insurance carrier and instruct the carrier to use the correct classification code.

What is the Interchange of Labor Rule and how is it used?
This rule is used to determine the proper classification for an employee who performs work that may be eligible for more than one classification. When an interchange of labor exists, the entire payroll for the employee will be assigned to the carrier’s highest rated classification representing any part of their work.
There is, however, an exception to this rule. If an employee is engaged in operations performed away from the employer's premises, separate classifications can be applied if separate payroll records are kept. Classifications known as Standard Exception Classes are not permitted for this division of payroll.

What is a Standard Exception Classification?
One basic classification is assigned to a business and it includes all employees of the business regardless of the type of work they perform. There are certain job categories, however, such as clerical office employees, telecommuters, executive officers, outside salespersons and drivers that are common to many, if not most, businesses. We refer to these as Standard Exception Classifications. When an employer has an employee(s) who does the type of work of a standard exception class, then the payroll for that employee(s) is assigned to the standard exception code.
There are certain classes that include these employments in the classification wording. This is because the work done by a standard exception class employee may be an integral part of that particular type of business. An example is a florist. The classification wording for a florist is "Florist & Drivers." In this instance, all employees, including drivers are assigned to the florist code. Since drivers are the only inclusion under the florist code, the code(s) of the other standard exception classes can be assigned to a florist, if applicable.  

How are Professional Employer Organizations (PEO’s) and their clients covered for workers compensation insurance in NY State? (Formerly known as Employee Leasing Arrangements.)
There are two options in New York for providing workers compensation insurance coverage for these arrangements. The first option requires separate policies to be written for the PEO and each of its clients. The client's policy is written in the client's name. The PEO policy covers only its non-leased workers. The New York Labor Contractor Endorsement (WC 31 03 17) is attached to the client's policy and names the PEO as an additional named insured. The New York Labor Contractor Exclusion Endorsement (WC 31 03 18) is attached to the PEO policy and lists each of the PEO's clients. Premium cannot be combined for premium discount or retrospective rating purposes.
The second option allows a policy to be issued to a client in the name of the PEO designating the PEO as the labor contractor for the client company. The New York Optional Labor Contractor Endorsement (WC 31 03 20) is attached to the PEO/client policy limiting coverage to only the leased workers of the client. In addition, if a client has employees that are not leased, then a separate policy in the name of the client is written to cover these employees. The New York Optional Client Exclusion Endorsement (WC 31 03 22) is attached to this policy limiting coverage to only those non-leased workers. Similar to the first option, a separate policy is issued to the PEO which covers only its direct employees. The New York Optional Labor Contractor Exclusion Endorsement (WC 31 03 21) is attached to the PEO's policy limiting coverage to its own employees and not the employees it leases to others. The premium for the PEO and its clients may be combined for premium discount and retrospective rating purposes.
There are no provisions in the New York rules, under either option, to allow the experience of all of the clients of a PEO and the PEO to be combined for experience rating purposes.

Are there any special requirements regarding the ERM-14 (Confidential Request for Ownership Information)?
The names of all of the stockholders, the total amount of shares and the amount of shares issued to them must be completed for all affected entities. An ERM-14 must be signed by an authorized executive officer of the corporation. Incomplete forms will be returned.

ABC Corporation is owned by a husband and wife; XYZ Corporation is owned by their two sons. Are they combinable?
No, they are not combinable, as family relationships are not recognized for combinability purposes.

Several entities were covered under one policy and ceased to be combinable. Will the experience modification be revised to exclude the experience of the non-combinable entity?
The Rating Board will only revise the experience modification if separate unit statistical reports for each entity are submitted to the Board within the allowable time period.

If there is no voting stock, what is the basis for the ownership determination?
The insured must submit a complete list of the board of directors or governing body of the entity.

Two separate corporations are engaged in completely separate lines of business with different employees and management. Why are they maintained under the same Combo ID number?
Rating Board rules regarding the combination of entities is based solely on stock ownership. The fact that the entities’ operations and employees are separate and distinct is not a criterion for the determination of combinability.

Ownership information shows that entities are combinable, and Rating Board files have been combined for experience rating purposes. What ratings are affected by the combination?
A revised experience modification will be issued effective, on the date of the change, providing that the information has been submitted within 90 days of the date of the ownership change.  All modifications effective after the date of change will also be revised to include the exposure of the combined files. 

When a material change occurs within an entity, does the experience continue to apply?
Unless the entity meets certain limited criteria, the experience of an entity undergoing a change in ownership will be transferred to the experience ratings of the acquiring, surviving, or new entity, in accordance with the rules of the New York Experience Rating Plan manual.

 What is the Criticism Fining Program?
One of the responsibilities of the Rating Board is to ensure that workers compensation policies are written in compliance with current rules, authorized rates and procedures.  Any policy not written properly is identified through the Rating Board’s policy editing process and the carrier is issued a policy criticism requesting correction of incorrect policy information.  A carrier’s non-compliance with the Rating Board request is subject to a fine.  Non-compliance of a Rating Board audit result is also subject to the Criticism Fining Program.


CONSTRUCTION CLASSIFICATION PREMIUM ADJUSTMENT PROGRAM (CPAP):

What is the New York Construction Classification Premium Adjustment Program?
The New York Construction Classification Premium Adjustment Program (NYCCPAP) addresses premium differences between high wage and low wage paying employers having similar construction operations. Premium credits based upon the hourly wage rate paid by the employer and the distribution of classifications shown on the employer’s policy are developed by the Rating Board and are applied by the carrier to the insured’s premium
Refer to the "Program" section of the Board website for details of this program which also includes the Premium Credit Application.

How can insureds check on their eligibility under the PAP Program after submitting an application?
After an application is processed, the Rating Board informs the carrier of the insured’s eligibility.  All questions concerning this credit are to be directed to the insurance carrier.

What is the Construction Employment Payroll Limitation Program?
Legislation was enacted in 1999, which applies payroll limitations to eligible construction classification codes. This law, however, does not apply to employments engaged in the construction of one or two-family residential housing. A premium off-balance, which varies by geographic territory, is applied to each classification on the policy to offset the payroll limitation.
Refer to the "Program" section of the Board website for details of this program which includes a question and answer section and examples of premium calculations.

Can an insured be entitled to adjustment under the PAP Program if they are also subject to the Payroll Limitation Program?
Yes, if the insured qualifies, he/she can apply for a premium adjustment credit.


FIELD SERVICES:

What is the reason for a Rating Board inspection or audit?
The reason the Rating Board conducts an inspection or an audit is to assure insureds and carriers that they are assigned to the proper job classification and that the correct premiums are being charged.
Audits are conducted under the Premium Verification Program on a random basis or by special request.
Inspections are conducted on experience rated risks on a 3 to 5 year cycle.  Inspections for non-experience rated employers are done on a random basis.  Other inspections may be conducted by special request if required to resolve a dispute. 

What is the Carrier Test Audit Performance Program?
This is a program that provides incentives for carriers to improve their audit proficiency. For carriers that exceed the minimum test audit error ratio, the program establishes a procedure for the Rating Board to work with member carriers to ensure that they meet the minimum standard.

How can one obtain copies of the Rating Board's Audit Guidelines?
Information regarding purchasing copies of the Rating Board's Audit Guidelines can be obtained by calling the Rating Board's Finance Division at (212) 697-3535, Ext. 152 or 153.


ACTUARIAL:

When is the loss cost filing material available to the public?
The supporting data and technical exhibits relating to the annual loss cost revision become public information only upon formal approval of the loss cost filing by the Insurance Department. This documentation is available in the “Actuarial” section of our website. A hardcopy version is also available to non-Rating Board members for a fee upon written request to the Actuarial Department.

What are the timeframes with respect to the annual loss cost revision and the implementation of revised workers compensation loss costs?
The Rating Board submits its annual loss cost revision to the Insurance Department no later than May 15 of each year for an October 1 effective date.  Upon approval of its filing, the Rating Board then publishes classification loss costs and rating values, reflecting the approved loss costs.  The insurance carriers are then responsible for developing and publishing their classification rates in time for the October 1 date.

If a policy has a different effective date from the Rating Board's established anniversary rating date, when would the anniversary rating date change?
The policy has to run for one full year before the anniversary date can be changed. 

What is the criterion used to determine the rates applicable to a particular policy?
The anniversary rating date of the insured determines which rates apply.

What is a change to outstanding policies?
A change to outstanding policies is an adjustment made to in-force policies that reflects changes in the benefits for injured workers as a result of a change in the New York State Workers' Compensation Law. These law changes usually take effect as of an accident date, not a policy effective date. Therefore, the change to outstanding policies reflects the revised provisions of the Workers' Compensation Law that were not in effect when the current manual rates were promulgated.

How is a change to outstanding policies reflected on a policy?
The outstanding rate change can be reflected on a policy in two different ways. One option applicable for all policies is that the exposures may be split as of the date of the rate change. The full value of the rate change is then applied to the premium earned after the rate change.
A second option, applicable for one-year policies covering operations that are not seasonal in nature, is to use the ratio method. In this option, the total manual premium is adjusted by a factor that varies by policy expiration date. This table of outstanding rate change values is published in the R.C. Bulletin announcing the rate change. Contact the Audit Department for additional information concerning the application of outstanding rate changes. 

What is the New York State Assessment?
The New York State Assessment is a policyholder charge that covers the administrative costs of the Workers' Compensation Board, and funds the Reopened Case Fund, the Special Disability Fund, the Special Funds Conservation Committee, and programs that monitor compliance with OSHA standards. The New York State Workers' Compensation Board assesses all carriers for the costs of these programs, and these assessments are in turn charged to all policyholders as the New York State Assessment.

How is the New York State Assessment applied on a policy?
The New York State Assessment is expressed as a percentage of standard premium. This premium reflects any experience modification, merit rating factor, minimum premium, New York Construction Classification Premium Adjustment Program credit, and any Workplace Safety Program credits or surcharges premium credits for carrier specialty programs (e.g., drug-free workplace managed care, PPO, alternative dispute resolution), and the charges for foreign and domestic terrorism. The premium base does not include the premium discount, the expense constant, and any deductible premium credits. However, rules for the collection of the New York State Assessment on Large Deductible policies and policies subject to a dividend or retention program, if different from those above, must be included in the carrier filings of those programs with the New York Insurance Department.

If an employer receives notice that he/she is subject to the Compulsory Workplace Safety and Loss Consultation Program, what should be done?
The employer should immediately contact his/her carrier and the New York State Department of Labor to obtain details regarding the statutory requirements of the program. The Rating Board should only be contacted when there are questions regarding the employer's experience modification or payroll used to determine eligibility for the program.

Does the Workplace Safety and Loss Consultation Program apply to New York insureds that are interstate (NCCI) rated?
Yes. However, the experience modification and payroll used to determine eligibility for the program is not based on the insured’s interstate (NCCI) experience rating, but on a New York only experience modification that is calculated by the Rating Board, solely on the basis of the insured’s New York operations.

What is the Premium Algorithm?
The premium algorithm is a step-by-step outline of the process to be used in determining workers compensation policy premium in New York. The algorithm can be found in the “Appendix” of the New York Workers Compensation and Employers Liability Manual.

DATA REPORTING:

How do I obtain information regarding data reporting requirements?
The data reporting requirements and procedures are detailed in the Actuarial Section of this website. 

Are there specifications on data structure and field requirements?  How to I obtain these specifications?
The data schema and field specification are based on Workers Compensation industry standards.  The specifics for policy reporting are detailed in WCPOLS.  The specifics for statistical reporting are detailed in WCSTAT.  These specifications are available from the Workers Compensation Insurance Organizations (WCIO) website, www.wcio.org, via download. 

 

Back To Top

 

 

Home | Terms of Use | Contact Us |

©2009 New York Compensation Insurance Rating Board