Classification System for Farm Operations

The purpose of the worker's compensation classification system is to group similar employers so that each classification reflects exposures common to them. Each classification combines the payroll and losses of similar employers to develop a price.

Most of Wisconsin farming classifications fall within the 0006 and 0008 codes in the Wisconsin Compensation Rating Bureau. Code 0006 is applicable to the typical beef and dairy cattle farm operation and includes raising cash crops like wheat, corn, and so forth. Code 0008 specifies vegetable farmers who sell their products to canneries or roadside stands. There is a rate per $100 annual payroll dollars and a minimum premium payment for that classification. The rate per $100 payroll is only part of the premium calculation; an expense constant is added to the answer before it is compared to the minimum premium. Farmers under the 0006 classification are determined to be higher risk and are rated higher than the 0008 classification.

Once a farmer's standard premium is calculated the larger farmer's premium may be further adjusted by an experience rating factor that compares the farmer's past losses over a 3-year period with losses an individual farmer of that size was expected to have during the same 3-year period. If the farmer's actual losses were less than expected, credit will be given. If the farmer's actual losses were greater than expected, a surcharge will be made. Contact your insurance agent for more information on how the premium will be calculated for your individual farm operation.

Any person engaged in farming who has become subject to the Worker's Compensation Act, may withdraw by filing with the Wisconsin Department of Workforce Development, provided he or she has not employed 6 or more employees on 20 or more days during the current or previous calendar year. A farmer may again become subject to this Act by employing 6 or more employees on 20 different days during a calendar year.