Workers' Comp Cost Estimator

How It Works

1. Enter Payroll by Class Code

   Input the annual payroll (gross wages) for each workers' comp class code in your company. Common construction codes include 5403 (carpentry), 5190 (electrical wiring), 5183 (plumbing), 5537 (heating/HVAC), and 8810 (clerical). If you have employees in multiple trades, add a row for each class code. Payroll should include wages, bonuses, and overtime (many states cap overtime at straight-time equivalent for WC purposes).

2. Pick Class Codes and a State

   Select each class code from the built-in list of 20 common codes with illustrative base rates, and choose a state to apply a representative factor. These are rough ballpark values, not filed rates - NCCI or the state rating bureau publishes the real loss costs/rates, and rates vary dramatically by trade: clerical (8810) may be $0.20 per $100, while roofing (5551) can exceed $30 per $100. Ohio, Washington, Wyoming, and North Dakota are monopolistic state-fund states where this private-carrier structure does not apply.

3. Enter Your EMR

   Input the EMR from your rating-bureau worksheet or policy documents. An EMR of 1.00 is the neutral multiplier in the simplified structure. Confirm the value, effective date, eligibility, and state-specific treatment with the worksheet, agent/broker, carrier, or state fund.

4. Review Premium Calculator

   The calculator shows a rough screened premium for each class code, the combined total, and an equivalent cost per labor hour from an assumed $35/hr blended wage. EMR scenario rows show direction and scale only; they are not quotes, audit results, or safety-program ROI guarantees.

Built For

• Construction company owners screening annual insurance-cost assumptions before broker/carrier review
• Estimators separating a rough WC component from final burdened labor rates for project bidding
• Safety managers reviewing the direction and scale of EMR scenario math before making a program case
• Bookkeepers and controllers sanity-checking the structure of broker premium quotes (with actual filed rates substituted for the bundled illustrative ones)
• New contractors estimating their first-year WC costs before hiring employees
• Multi-trade contractors comparing WC costs across divisions to understand which trades drive the highest premiums

Features & Capabilities

EMR Sensitivity Calculator

Shows a table of rough premium math at common EMR scenario values (0.75, 0.80, 0.90, 1.00, 1.10, 1.20, 1.50), based on entered payroll and class codes, with dollar and percentage differences versus the entered EMR.

Multi-Class Code Support

Screens companies with employees across multiple class codes. Each code carries an illustrative base rate, and the calculator applies the entered EMR uniformly across all rows as a simplified structure. Verify governing class, standard exceptions, payroll separation, and state rules before relying on any allocation.

Cost Per Labor Hour

Converts the rough screened premium into a per-hour prompt using labor hours estimated from total payroll at an assumed $35/hr blended wage. Substitute actual payroll and wage data before job costing.

Assumptions

• Class-code base rates and state factors are bundled illustrative values, not filed rates. Get current state-approved loss costs/rates from NCCI, the state rating bureau, or your carrier - rates change annually in most states.
• EMR is applied as a simple multiplier to the manual premium (Manual Rate x Payroll / 100 x EMR). Actual premium calculations may include schedule credits, premium discounts, expense constants, and state-specific modifiers that this calculator does not model.
• Payroll figures should reflect remuneration as defined by NCCI or the applicable state bureau. This generally includes wages, salaries, commissions, bonuses, and overtime at straight-time equivalent, but excludes tips, severance pay, and group insurance payments.
• The calculator produces a rough calculator, not a quotation, policy rating, audit result, or insurance advice. Actual premiums are determined by the carrier, state fund, or rating authority from filed rates, underwriting, policy charges, and audited payroll.

Limitations

• Does not model state-specific premium modifiers such as schedule rating credits/debits, premium discounts for large risks, or minimum premium requirements.
• Does not calculate EMR from claims history. EMR computation requires your NCCI experience rating worksheet data, including expected losses, actual incurred losses, and primary/excess loss splits. Contact your broker or NCCI for EMR calculation details.
• Does not cover monopolistic state fund states (Ohio, Washington, Wyoming, North Dakota) where premium structures differ from the standard NCCI model.
• Does not account for retrospective rating plans, large deductible programs, or self-insured retention structures used by larger contractors.
• Does not model audit adjustments. Most WC policies are audited at the end of the policy term and the premium is adjusted based on actual payroll, which may differ from the estimate.

References

• NCCI (National Council on Compensation Insurance) - Experience Rating Plan Manual and Basic Manual of Workers' Compensation and Employers' Liability Insurance. Defines class codes, manual rates, and the EMR calculation methodology for 38 states.
• State Rating Bureaus - Independent rating organizations in non-NCCI states (CA, DE, IN, MA, MI, MN, NJ, NY, NC, PA, WI) that set their own class codes and rates.
• OSHA - Injury and Illness Recordkeeping (29 CFR 1904). OSHA recordable injuries feed into the claims data used to calculate EMR.
• IRMI (International Risk Management Institute) - Workers' Compensation reference materials and class code descriptions.

Frequently Asked Questions