The California Restaurant Mutual Benefit Corporation (CRMBC) is endorsing the upcoming changes in workers’ compensation classifications for California’s restaurant and hospitality sectors, as announced by the Workers’ Compensation Insurance Rating Bureau of California (WCIRB).
CRMBC is a California Self-Insured Group (SIG) formed BY restaurant owners FOR restaurant owners. Choosing to opt out of commercial insurance that uses premiums to boost their substantial profits and overhead, CRMBC is a group of business-savvy restaurant owners who joined forces to self-insure their work comp for sustainable cost savings.
This significant update to the classification system will take effect on September 1, 2024. This update, a result of a comprehensive study, introduces six new classifications within the restaurant and hospitality sectors to better reflect the diverse operations and risk profiles across the industry.
The six new classifications, effective September 1, 2024, are:
– – 9058, Hotels, Motels or Short-Term Residential Housing – food or beverage employees
– – 9080, Restaurants – full service
– – 9081(1), Restaurants – N.O.C.
– – 9082, Caterers – not restaurants
– – 9083, Restaurants – fast food or fast casual
– – 9084, Bars or Taverns – not restaurants
The following classifications will also be included in the Food and Beverage Service Industry Group:
– – 8078(1), Sandwich Shops
– – 8078(2), Beverage Preparation Shops
– – 8078(3), Ice Cream or Frozen Yogurt Shops
– – 9081(2), Concessionaires
– – – – Classification Code changing from 9079(2) effective September 1, 2024
Previously consolidated under broad categories, these new classifications aim to provide a more accurate representation of risk, thereby enabling fairer premium assessments. The changes are designed to capture the evolving dynamics of the restaurant industry, addressing the need for granularity in risk assessment and insurance rate determination. This strategic adjustment is part of WCIRB’s ongoing efforts to enhance the standard classification system, ensuring it remains relevant and responsive to industry trends.
Kaya Stanley, CEO and Board Chair of CRMBC urges workers’ compensation brokers and restaurant owners to engage actively with the forthcoming changes. “Understanding the implications of the new classifications on policies and rates is crucial,” Stanely said. “While the immediate impact on rates is expected to be neutral, the long-term benefits of more accurately identifying risks and performance cannot be understated. This reclassification will enable more strategic decisions regarding loss prevention, safety programs, and overall risk management – ultimately benefiting the entire industry.”
According to the WCIRB, the changes to workers’ compensation classifications are more than administrative adjustments; they are a forward-looking approach to better serve the needs of California’s diverse restaurant industry. By breaking down the broad Classification 9079(1) category into six detailed classes, insurance will better align with businesses’ actual risks and operations.
Bill Mudge, WCIRB President and CEO, commented, “We appreciate the opportunity to educate all workers’ compensation system colleagues, including CRMBC members and restaurant owners across California, on the upcoming changes to Classification 9079, Restaurants or Taverns, as approved by the Insurance Commissioner and effective September 1, 2024. Stakeholders can find our latest interactive and educational resources on our website.”