Workers’ Comp Insurance for Hydraulic Fracturing (Fracking) Operations

Hydraulic fracturing, more commonly known as fracking, has become one of the most widely used methods of extracting natural gas and oil in the United States. The industry has played a major role in driving energy independence and providing jobs in regions that rely heavily on resource extraction. Yet, despite its growth and importance, fracking remains one of the most hazardous industries for workers. The risks associated with hydraulic fracturing are significant, ranging from chemical exposure to heavy machinery accidents, and that makes workers’ compensation insurance not only essential but also challenging to secure.

At NPN Brokers, we work directly with businesses in high-risk industries including hydraulic fracturing operations to ensure that they can obtain the workers’ comp coverage they need, even if they have experienced prior claims or other roadblocks. This blog will take an in-depth look at the risks in hydraulic fracturing, why obtaining workers’ compensation coverage can be difficult, which class codes apply, and how NPN Brokers can help secure flexible coverage for businesses in this demanding industry.

Understanding the Risks in Hydraulic Fracturing

Fracking operations are inherently high-risk due to the nature of the work. The process involves drilling into rock formations, injecting a high-pressure mixture of water, sand, and chemicals to release oil and gas, and managing large-scale equipment on site. These environments present numerous safety concerns, many of which are unique to hydraulic fracturing compared to other areas of the oil and gas industry.

Common Risks in Fracking Operations

Heavy Equipment Hazards: Workers routinely operate or work near massive machinery, including drilling rigs, pumps, and trucks. Accidents involving equipment can cause serious injuries such as fractures, amputations, or crush injuries.
Chemical Exposure: Workers handle and are exposed to hazardous chemicals, including acids, silica sand, and proprietary fracking fluids. Prolonged or high-level exposure can lead to respiratory issues, chemical burns, or long-term health complications.
Explosions and Fires: With flammable gases and chemicals on site, explosions and fires are a constant threat. Improper handling, equipment failure, or human error can trigger catastrophic accidents.
Slips, Trips, and Falls: Fracking sites are often muddy, wet, and uneven, which increases the risk of falls, sometimes from elevated platforms.
Long Hours and Fatigue: Many workers endure 12-hour shifts for multiple days in remote locations. Fatigue increases the likelihood of accidents and injuries.
Transportation Risks: Workers often drive or ride in large trucks transporting equipment, sand, and chemicals. Road accidents in rural or poorly maintained areas are common.

These risks translate to higher rates of workplace injuries compared to lower-risk industries, which in turn makes it difficult for hydraulic fracturing operations to secure affordable and reliable workers’ compensation coverage.

Why Workers’ Compensation is Difficult to Obtain in Fracking

Insurance carriers categorize fracking as a high-risk industry due to its elevated injury rates and severe claims history. A single workers’ comp claim in this field can be costly, involving extensive medical care, rehabilitation, and lost wages. Because of this, many traditional insurance carriers are unwilling to write workers’ comp policies for fracking companies, especially smaller operations or those with a history of claims.

Key Challenges

High Claim Frequency and Severity: Carriers recognize the high likelihood of injury in this industry. Claims are often severe, leading to permanent disability or long-term medical treatment, driving up costs for insurers.
Prior Claims History: If a company has prior claims, even if they were isolated incidents, carriers may view the operation as too risky to insure. This creates a barrier for companies trying to move forward responsibly.
Multi-State Operations: Many fracking companies operate across state lines, transporting equipment and employing workers in multiple states. Securing multi-state workers’ comp policies is challenging, especially since each state has different requirements and regulations.
Classification Issues: If employees are not classified correctly under the right workers’ comp codes, it can lead to compliance issues, denied claims, or incorrect premiums. For fracking operations, proper classification is especially important due to the wide range of job roles.
Limited Carrier Options: Many standard carriers exclude oil and gas risks altogether, forcing fracking companies to look to alternative markets or specialty brokers to secure coverage.

This combination of risks makes it critical for hydraulic fracturing operations to work with a broker who understands the complexities of the industry and has access to carriers willing to write policies for high-risk businesses.

Workers’ Comp Class Codes for Hydraulic Fracturing

Accurate classification of employees is one of the most important steps in securing workers’ compensation coverage. The National Council on Compensation Insurance (NCCI) assigns workers’ comp class codes to different types of work, which helps determine premiums based on the inherent risk of each job. For hydraulic fracturing, several class codes are applicable depending on the role of the employee.

Common Class Codes in Fracking

Class Code 6235 – Oil or Gas Well Drilling – Hydraulic Fracturing: This is the primary code that applies to companies engaged in hydraulic fracturing operations. It includes workers involved in the actual fracturing process, including rig operators and crews.
Class Code 6236 – Oil or Gas Well Servicing – By Specialist Contractors: This may apply to workers providing specialized services to support fracking, such as pumping or maintenance crews.
Class Code 6204 – Oil or Gas Well Servicing – All Employees: A broader code that can encompass workers engaged in services like casing, cementing, or maintenance related to drilling and fracturing.
Class Code 6216 – Oil or Gas Lease Work NOC (Not Otherwise Classified): For employees performing general maintenance, road building, or other activities on oil and gas leases.
Class Code 3632 – Machine Shops: For companies that manufacture or repair fracking equipment parts. While not always used on site, many businesses in the fracking supply chain fall under this code.

Each state may have specific variations or additional codes, and certain states such as Texas, Pennsylvania, and North Dakota are particularly active in hydraulic fracturing and therefore have more regulatory oversight. Ensuring that employees are placed under the correct class code is essential not only for compliance but also for controlling costs and avoiding disputes over claims.

How NPN Brokers Helps Fracking Operations Secure Coverage

At NPN Brokers, we specialize in helping high-risk businesses like hydraulic fracturing operations obtain the workers’ comp insurance they need. We understand the challenges these companies face and work with carriers that are willing to provide flexible coverage even in cases where other brokers have said no.

Why Work With NPN Brokers?

We Work With High-Risk Industries: Unlike many brokers, we do not shy away from industries like oil and gas. We know the risks and have established relationships with carriers that write coverage for these businesses.
Coverage Despite Prior Claims: If your company has experienced claims in the past, that does not mean you cannot get coverage. We help businesses with claims history find affordable policies that meet their needs.
No Audits, No Contracts, No Deposits: Traditional policies often involve large upfront deposits, binding contracts, and lengthy audits. With NPN Brokers, we work with carriers offering Pay-As-You-Go coverage so businesses only pay for what they need.
Multi-State Policies: Many fracking operations employ workers across multiple states. We can help secure multi-state workers’ comp coverage under a single policy, simplifying compliance and reducing administrative burdens.
Fast Turnaround: We can provide a workers’ comp insurance quote in minutes and have coverage in place in as little as 24 hours, keeping your operations moving without unnecessary delays.

Why Proper Workers’ Comp Coverage Matters in Fracking

For hydraulic fracturing companies, workers’ compensation is not just a regulatory requirement. It is a vital part of protecting the business and employees. Without proper coverage, the financial burden of a workplace accident can cripple a company. Medical expenses, lost wages, and potential lawsuits can add up to millions of dollars, particularly in industries as hazardous as oil and gas.

Workers’ comp coverage also protects employees, ensuring they receive the medical treatment and wage replacement they need after an injury. This not only helps workers recover but also fosters loyalty and retention in an industry where turnover is high.

Additionally, many oil and gas operators and contractors require proof of workers’ comp coverage before allowing subcontractors on site. Without coverage, fracking companies can lose out on valuable contracts and opportunities.

The Bottom Line for Hydraulic Fracturing Companies

Hydraulic fracturing is one of the most demanding and dangerous industries in the U.S., which makes workers’ comp insurance both essential and difficult to obtain. Between high injury risks, prior claims, and the complexity of multi-state operations, many companies find themselves struggling to secure coverage through traditional channels.

That is where NPN Brokers comes in. We specialize in securing workers’ compensation coverage for high-risk industries like hydraulic fracturing. Whether you have been turned down by other carriers, faced challenges due to claims history, or simply need fast and flexible coverage, we can help.

If you are running a fracking operation and need workers’ comp insurance, call NPN Brokers today at (561) 990-3022 or fill out our online quote request form. We will provide a quote in minutes and can have coverage in place in as little as 24 hours. Do not let coverage challenges slow down your operations. Partner with NPN Brokers and keep your workforce protected.