Class codes are essential for understanding your workers' compensation insurance premiums. Knowing the class codes for painters helps ensure your business has the right coverage and avoids unwelcome surprises when it comes to your rates.
What are Class Codes, and why do they matter?
If you’ve explored workers' compensation insurance for painters, you’ve likely come across “class codes.”
Class codes are like barcodes to easily reference information on different jobs and industries. These four-digit codes correspond to particular job roles and include job descriptions along with associated risk rates.
The National Council on Compensation Insurance (NCCI) establishes these codes, updating them yearly based on data from past claims. Your insurance rate is determined per $100 of payroll.
For example, if you specialize in painting, your class code would be 5474. With a national average rate of about $5.57, if you had an annual payroll of $100,000, your base premium would be $5,570.
Painting Workers’ Comp Class Code
Painting Class Code 5474 - Interior and Exterior Painting
Class Code 5474 is the code generally used by painting contractors and includes both interior and exterior painting work on residential and commercial properties.
This class code includes a range of painting jobs, covering both residential and commercial work, whether it’s applying tinted coatings, painting windows, working on exteriors, or even line-painting in parking lots.
Non-industry class codes that may apply to your plumbing business
You may have team members who don’t directly handle painting tasks but still require workers’ comp coverage. These employees, such as office staff, fall under a non-industry code.
One widely used non-industry code is 8810, which covers clerical employees. This code generally comes with a lower rate, helping you save on premiums for administrative roles.
Average Workers’ Comp Rates for Painting Class Code 5474
Here are typical workers’ comp rates for painting businesses in selected states:
How do Class Codes affect insurance rates?
Higher-risk roles have higher workers' comp rates. For example, class code 5474 (painting work) might carry a rate of $2.11 per $100 of payroll due to the hands-on, physical nature of the work.
In contrast, other trades like electricians and plumbers generally have lower rates due to the specific risks inherent to their jobs, which may involve less exposure to heights or hazardous materials.
Class codes aren’t the only factor impacting your rate, though. Your experience modification rate (ExMod), which is determined by your company’s claim history, also plays a role.
Understanding ExMod
An ExMod, or experience modifier, reflects your business's likelihood of injury compared to similar companies. Each business has its own unique ExMod, calculated based on its claims history over the past few years. A business with an average risk level will have an ExMod of 1.0.
ExMod below 1.0: You’ll pay less than average. For example, with an ExMod of 0.95, you’d receive a discount and pay below the base rate for your class code.
ExMod above 1.0: You’ll pay more. If your ExMod is 1.05, your rate would be 5% above the base rate, increasing your premium.
Curious about how these rates translate to actual costs? Check out this guide to workers’ comp rates for painters.
Need the best Workers' Comp Rates for your Painting Business?
Navigating workers' comp rates doesn’t have to be a challenge. At Kickstand Insurance, we specialize in helping painting contractors find affordable, comprehensive coverage tailored to their needs.
Get a free workers’ comp quote today from Kickstand Insurance and discover how much you can save.
Note: The information provided in this blog is intended for general informational purposes only and is not a substitute for professional legal or insurance advice. Laws and regulations regarding workers' compensation insurance are complex and vary by state and by specific circumstances. Therefore, readers are encouraged to consult with a qualified legal or insurance professional to obtain advice with respect to any particular issue or problem they might have.
Mordechai Kamenetsky, co-founder and lead agent of Kickstand, is recognized as an expert in workers' compensation. He is passionate about helping small businesses manage risks and lower their workers' comp costs. In his articles, he educates readers and clients on the intricacies of workers' comp insurance.
Legally, workers’ comp is not needed for 1099 employees. However, if the employee lacks coverage, you may be held liable in case of injury. Also, if a state or federal authority determines your 1099 workers are not in fact independent contractors, they must be reclassified as employees. That also means you’re required to provide them with workers’ compensation insurance.
