Cable television and internet services are a regular part of most peoples lives in today’s technological age. Cable installers provide a service to customers through the installation of both fiber optic and coaxial cables for both cable television and internet service providers. The work cable installers do can be physical because they install lay lines or cables throughout many parts of a property and the work is almost exclusively done on third party properties that vary greatly. Because of the differences in the locations the work is done, there is a lot of risk for cable installers looking to insure themselves and their business. Here are some tips about how employees of a cable installation business should be classified, if cable installers are required to carry workers comp coverage, what underwriters are concerned about, and what a cable installation business should be concerned about in relation to workers compensation insurance.
How Should Cable Installers be Classified?
The most common workers comp codes used in the cable installation industry is NCCI Class Code 7356. NCCI Stands for the National Council on Compensation Insurance. This organization is the foremost authority on workers compensation classification codes and recommending pure premium rates. NCCI gathers data, analyzes industry trends, provides objective insurance rate and loss cost recommendations. If you are the owner of a cable installation business, it is important to make sure all employees are classified properly. You can do this with the help of an independent insurance agent, but the responsibility is ultimately up to the business to make sure all employees are classified properly.
Separate from workers compensation classification, Cable Installers are most often employed as either employees of a cable service provider or as a contractor. When a worker is classified as an employee, in most cases it is the law of the state for them to be covered by workers compensation insurance. W-2 employees must be covered by workers comp in most instances, but in many states independent contractors are also considered employees for purposes of workers compensation insurance. For this reason, it is again important to partner with an independent insurance agent. The independent agent can help a business owner determine how best to classify your employees (W2 or 1099). Independent agents also allow a business owner to get unbiased advice about each policy and each carrier. They also can help you determine what is the best way to classify your employees and what risks you are taking insuring or not insuring those employees.
Are Cable Installation Businesses required to carry Workers Comp?
Workers Compensation Insurance is governed by the states and not the federal government. In some states there are exclusions to the requirement for workers comp coverage depending upon the structure of the business, the annual revenue, or the number of employees. It is important to check with the proper governing body within the state or states the business operates to make sure the business is following the proper laws. Even if the business is allowed to not carry workers comp coverage, it is usually a good idea to still secure some form of coverage. Even when the installer is the only employee of the business, some carriers offer a ghost policy at significantly lower premium to have some coverage in place.
In order to enter into most contracts, cable installers are required to provide a certificate of insurance. The certificate of insurance shows what coverages and the limits of coverage the business or contractor has in place. It also includes the policy effective dates. Most contracts require an installer to have workers comp and general liability at a bare minimum. Some contracts will require additional policies. This is where the help of an independent agent can be valuable because they can give you many options from many different carriers in an attempt to meet the needs of all contracts.
What Concerns an Underwriter about a Cable Installation Business?
Cable Installation work is done primarily on third party locations and each property varies greatly. This brings about a driving risk that most insurance carriers do not like. Any time there is a driving risk it raises both the frequency and severity of a claim. This is because when a person is driving a vehicle for work purposes, the liability to third parties is the liability of the business, not the liability of the driver. This means when an employee causes a wreck, the business is liable for damages and medical costs of injured third parties. The fact that work is being done at third party locations also raises the risk of both bodily injury and property damage. This elevated risk results from the cable installer not being familiar with the location they are doing their work. The cable installation business has little input on the maintenance and upkeep of the facility. Additionally, the biggest risk a cable installation business has to worry about is electrocution. The level of risk is low, but the consequences of that low risk are extremely high.
Concerns for Cable Installers Relating to Workers Comp
The first concern related to workers’ compensation coverage is whether the cable installer is an employee for a cable provider or whether they are an independent contractor. If they are an employee of the company than the company is responsible for carrying the proper workers compensation coverage for them as an employee. Now if they are a contractor, depending upon the state the installer may need to purchase coverage for themselves and for their business if they have employees working for them. It is important to speak with an independent insurance agent and the proper governing body in the state in which you operate in to make sure you have the proper coverage.
In addition to W2 vs. 1099 contractors is the NCCI Classification code of all employees. The most common workers compensation classification codes for cable installers include:
- 7536: Cable Installation and Construction
- 8901: Cable and Telecommunications—Office Employees
- 7600: Cable TV or Satellite—Other Employees and Drivers
- 6325: Conduit Construction—for Cables or Wires
- 8742: Outside Sales Persons
Partnering with an independent insurance agent and speaking long and honestly with them is the best way to determine how all employees should be classified and prevent a costly post term audit.