Common Questions About Florida Workers’ Compensation Insurance

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WorldExecutivesDigest.com | Common Questions About Florida Workers’ Compensation Insurance | Whether you’re entirely new to owning and running a business or are a seasoned employer expanding your operations to a Florida location, you’ll have to get to know the state-specific laws regarding workers’ compensation insurance. Though Florida’s workers’ comp laws have much in common with those of other states, you need to understand the slight by significant differences to ensure you comply with all state regulations and standards. 

As you research the laws and begin your search for a certified workers’ comp insurance provider, you’ll likely have a couple of questions or need some clarification. Before diving any further into the process of purchasing coverage, review these common questions that Florida business owners have about workers’ compensation. 

  1. What State Laws Do I Need to Read and Understand?

The federal government does not set rules and regulations for workers’ compensation insurance. In turn, you have to turn to state laws to find the answers you’re looking for. On the official Florida Legislature website, you can find the most up-to-date copy of the State Statutes, including chapter 440 of Title XXI, which covers workers’ compensation policies.

In this chapter, you will find all the information needed on coverage, compensation, and the responsibilities of the parties involved. If you still have questions after reading through the statutes, you can talk to your company lawyer or a licensed insurance agent.

  1. Who Oversees Workers’ Compensation Insurance in Florida?

Florida’s Department of Financial Services has its own Division of Workers’ Compensation (DWC), which assists injured workers and their employers. The organization also ensures that claims are adjusted and refunded appropriately should a dispute occur. 

  1. Who Does Florida Require to Have Coverage?

Throughout all of Florida, businesses with the following characteristics must carry workers’ compensation insurance: 

  • Construction employers with one or more employees, including corporate officers or limited liability company (LLC) members, must have this form of insurance. 
  • Employers in agriculture with at least six regular employees legally have to provide workers’ comp coverage. If the employer has 12 temporary workers who work more than 30 days during a season but less than 45 days in a year, they also need coverage.
  • Employers from any other line of business with four or more employees, including corporate officers and LLC members, must have workers’ comp. 
  1. Is Anyone Eligible for Exemption?

To apply for a workers’ compensation exemption, you must register with the Florida Department of State Division of Corporation. The following types of employers are eligible for an exemption:

  • In the case of corporations and LLCs in the construction sector, corporate executives or LLC members with at least 10 percent ownership may apply, but no more than three officers or members can have an exemption.
  • In the case of corporations in other sectors, a director of the company may apply for exemption from workers’ compensation.
  • LLCs from sectors other than construction may also apply for an exemption. The applicant must have at least 10 percent ownership of the LLC, and the company cannot have more than 10 exempt members.

Obtaining a workers’ compensation exemption can help you save on insurance costs, but some risks are worth considering. Should you suffer an injury while working or on company property, you will have to cover the costs out of your own pocket. If you’re considering this option, click here to learn more about Florida workers’ compensation exemption.

  1. Where Can I Find Information About Coverage Minimums?

Since industries have different associated risk factors, those with a higher risk of injury will have higher insurance premiums. Premiums are calculated using the following formula: 

Payroll/$100 x Class Code Rate x Experience Modifier + Taxes & Fees = Premium

Florida uses the industry classification codes set by the National Council on Compensation Insurance (NCCI), and you can look up your industry code here. 

  1. Does Florida Have a State Fund for Workers’ Comp Insurance?

Florida does not have a state fund, but it does have an insurer of last resort: the Florida Workers’ Compensation Joint Underwriting Association (FWCJUA). Created in 1993, the association provides workers’ comp to employers in Florida who are required to maintain coverage but are unable to obtain the necessary coverage in the private market.

Getting Covered 

In late 2019, the National Council on Compensation Insurance (NCCI) saw a decline in workers’ comp claims in Florida and authorized an overall 7.5 percent reduction in all state insurance rates, according to Insurance Journal. If you do your due diligence to research Florida laws and compare your options from different providers, you can find a workers’ comp insurance policy that puts you and your employees at ease.