When looking over a quote for a disability policy (whether it be business or personal) you may notice a number followed by a letter described as an occupation class. This designation denotes the difference between lower and higher risk occupations and affects 

the premium rate accordingly. While there can be differences in the specific numbers and letters used, and some companies who have similar class designations may assign a different class to the same occupation than another company might, patterns can be seen in how in the placements of certain occupations in the larger scale of occupation classes.

First created in the late 19th century around the time of the Industrial Revolution, Occupation classes came about alongside modern accident insurance policies. These classifications were the result of insurers concluding that workers in more labor intensive and hazardous jobs were more often subject to injuries. Often split between “white-collar”and “blue-collar”, differences in classification are shown in adjusted premium, and determination of payout eligibility. 

Coming into the middle of the 20th century, development in disability policies after the 2ndWorld War resulted in the numerical and letter classes we see today. Numbers usually range from 1-6, while letters can cover quite a large spectrum starting with A. Some 

commonly seen letters are “M” denoting Medical occupations, or “D” denoting Dental occupations.

In todays times, occupation classes are one of the essential first steps in the underwriting process allowing for quick, at-a-glance information of an applicants occupation and training. Duties, training, and past claim experience can affect class designations. These

designations directly affect benefit amounts, definition of occupation, along with premium rates.

Insurance carriers design their own underwriting guidelines, so one can conclude that looking at coverage from multiple carriers will give the greatest chance of finding a company with the most optimal occupation classification for ones current profession.

Written by: Jerry Dougherty