---
title: "What is the Applicant's industry classification (NAICS / industry select)?"
url: https://insuranceposture.com/questions/governance-and-workforce/applicant-s-industry-classification
category: "Governance and workforce"
canonical_key: q_gov_010
evidence_state: attested
updated: 2026-08-24
---

# What is the Applicant's industry classification (NAICS / industry select)?

URL: https://insuranceposture.com/questions/governance-and-workforce/applicant-s-industry-classification
Section: Governance and workforce
Evidence state: Attested, not tenant-verifiable

This field sets your base rate before a single control is read, and a wrong classification is expensive in both directions.

## What the carrier is actually asking

The carrier wants your industry classification, usually as a code or a menu selection. It determines the base rate, the appetite, and sometimes whether the submission proceeds at all.

## Why it is underwritten

Loss frequency and severity differ enormously by sector. Healthcare, education, public sector, and professional services carry very different profiles, and carriers maintain appetite by class. The classification is the first filter applied to your submission.

## Where the answer lives in Microsoft 365, Entra ID, and Azure

This is a factual disclosure and it should match your other filings.

| Platform | Where the setting lives | What has to be true |
| --- | --- | --- |
| Filings | The classification used in tax and regulatory filings | Consistency, since an inconsistency between filings and the application is difficult to explain. Attested |
| Revenue | Revenue split by activity | The classification reflects the largest activity rather than the one you identify with |
| Operations | Secondary activities that carry different risk | Disclosed separately, since a secondary line can carry the majority of the exposure |
| Public presence | How you describe your business publicly | Consistency with the website and marketing, which is easily checked |
| Policy | The classification recorded on the policy | Correct on the schedule, since an error there can affect a claim |

**Understating the classification can cost the claim**

Choosing a lower-rated class because it seems close enough is a misrepresentation of a fact material to the rate. If the loss arises from the activity that was not disclosed, the carrier has a straightforward argument. Disclose the real activity and, if the rate is unattractive, address it through structure rather than through classification.

## What a defensible yes requires

- The classification matches your regulatory and tax filings.
- It reflects the activity generating most of the revenue.
- Secondary activities with different risk profiles are disclosed.
- It is consistent with how you describe yourself publicly.
- It appears correctly on the policy schedule.

## How this answer goes wrong

A technology company that provides managed services classifies as software, which is rated differently and carries different appetite. If a claim arises from the services work, the disclosure question becomes material.

## If this answer turns out to be wrong

The attestation clause you sign lives in this block, and its wording decides whether your answers are treated as representations or as something stricter. Whether anything follows from an inaccuracy depends on materiality, on the policy wording, and on the law of the governing state: [whether an answer is a warranty or a representation](https://insuranceposture.com/glossary/warranty). The other consequence terms are collected in the [glossary](https://insuranceposture.com/glossary).

## Frequently asked

### What if we span several industries?

Use the primary revenue-generating activity and disclose the others. Carriers can accommodate mixed operations when they know about them.

### Can we choose a favourable code?

Only if it is accurate. Selecting a class that does not describe your operations is a misrepresentation of a rating factor.

### Does the code affect coverage?

It affects rate and appetite, and it can affect how exclusions apply. It is worth checking the schedule after binding.

### What if our business changes?

Tell the carrier. Material changes in operations are usually disclosable during the policy period as well as at renewal.

## Related questions

- [Is the Applicant engaged in adult content, cryptocurrency, gambling, payment processing, or MSP/MSSP business?](https://insuranceposture.com/questions/business-profile/applicant-engaged-adult-content-cryptocurrency-gambling-payment-processing-msp)
- [What is the Applicant's primary technology business operations (Software / Hardware / Services)?](https://insuranceposture.com/questions/services-and-contracts/applicant-s-primary-technology-business-operations)
- [Is the Applicant engaged in any business other than its described operations?](https://insuranceposture.com/questions/business-profile/applicant-engaged-business-other-than-described-operations)
- [Any significant changes in nature or size of business anticipated next 12 months (M&A, consolidation)?](https://insuranceposture.com/questions/business-profile/significant-changes-nature-size-business-anticipated-next-12-months)

---

Insurance Posture by SecValley. https://insuranceposture.com
The question library is written in our own wording to reflect the control topics that recur across US cyber application and ransomware supplemental forms. No carrier form is republished.
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