Everything Employers Need to Know About Florida Workers’ Comp Insurance
As an employer, it’s important to understand Florida’s Workers’ Compensation insurance requirements thoroughly. Fail to do so, and you might face serious repercussions in Florida.
Workers’ Compensation insurance protects employers and employees after workplace injuries in Florida. Coverage is mandated based on payroll and industry, so you may be required to purchase Workers’ Compensation insurance in Florida. In some cases, employers can file for an exemption from coverage, though doing so might be risky. In Florida, employers pay for Workers’ Compensation insurance, not employees. Cost is usually determined based on a business’s age, payroll, industry, and history. To lower monthly premiums while staying protected, employers can turn to our Florida brokers and find affordable, comprehensive Workers’ Compensation insurance coverage.
Our experienced brokers are here to help Florida employers get the Workers’ Compensation insurance coverage they need to protect their employees and their businesses. To learn more about the Florida Workers’ Compensation insurance brokers at NPN Brokers, call us today at (561) 990-3022.
What is Workers’ Compensation Insurance in Florida?
As a business owner, protecting yourself, your employees, and your company in the event of a workplace injury is important. By purchasing Workers’ Compensation insurance, you can have a safety net, so to speak, in case an accident happens at work. Instead of your business being financially liable for a worker’s injuries, an injured employee can file a Workers’ Compensation claim with your carrier.
Workers’ Compensation insurance exists to protect businesses and their employees. Employees get protection by having a simple pathway to compensation after an accident, while employers get protection by avoiding litigation.
Workers’ Compensation insurance is like any type of insurance. You purchase a policy, which might differ depending on the plan and the carrier, and you pay a premium for the protection you receive. And, like with any type of insurance, Workers’ Compensation insurance requires you to contact insurance companies to request quotes and find a policy. This can be intimidating for employers in Florida who might be unfamiliar with the process and have difficulty understanding exactly what Workers’ Compensation insurance is and why it is important.
When purchasing any type of insurance, it is important to seek help from professionals. Our experienced Florida Workers’ Compensation insurance brokers can explain the ins and outs of the state’s Workers’ Compensation system so that you understand precisely what it is, why it’s required, and how you can easily get it.
Workers’ Compensation Insurance Requirements for Employers in Florida
Florida is relatively strict regarding its Workers’ Compensation insurance requirements. In fact, most businesses are required to purchase Workers’ Compensation insurance in Florida. Because insurance is mandatory in many cases, it is crucial to learn whether your business requires coverage. Failure to comply with Florida’s Workers’ Compensation insurance laws can cause serious issues for employers in Florida.
Construction Companies
In Florida, all construction companies must purchase Workers’ Compensation insurance, regardless of payroll. So, even companies with just one worker must have coverage if they operate in the construction industry. That is because construction companies are at a higher risk for workplace injuries in Florida.
Many types of work fall under the umbrella of construction. To understand how the construction industry is defined and if your business is considered part of it, speak with our Florida Workers’ Compensation insurance brokers.
Non-Construction Companies
For non-construction companies, there are fewer Workers’ Compensation insurance requirements. Generally, non-construction companies with four or more employees are required to purchase Workers’ Compensation insurance in Florida, except for agricultural companies. Those in the agricultural industry require coverage if they employ six or more regular workers or 12 or more seasonal workers. If your company is within the agricultural industry and you are unsure whether your employees are considered seasonal or annual, ask our Florida Workers’ Compensation insurance brokers for clarification.
All other non-construction companies, including restaurants, retail stores, and any business big or small, must have Workers’ Compensation insurance if they employ four or more workers. For non-construction companies, coverage is required based on payroll, not any other risk factors.
Do Contractors and Sole Proprietors Need Workers’ Compensation Insurance in Florida?
Sole proprietors and independent contractors are often treated differently when it comes to Workers’ Compensation insurance requirements. In Florida, that’s no different. Suppose you are a sole proprietor or an independent contractor working in Florida. In that case, it’s important to learn whether or not you are required to purchase Workers’ Compensation insurance.
Sole Proprietors
As a sole proprietor, there is no legal distinction between you and your company. Often, small business owners or entrepreneurs will start a sole proprietorship to work for themselves and be their own boss. Suppose you are a sole proprietor, you work alone or employ less than four workers, and work outside of the construction industry. In that case, you are excluded from Florida’s Workers’ Compensation system. If you are part of the construction industry, you must purchase Workers’ Compensation insurance in Florida, even if you work alone.
Contractors
In Florida, independent contractors are automatically excluded from Workers’ Compensation insurance requirements and are not permitted in the construction industry. Instead, contractors who work in the construction industry must start a business and get Workers’ Compensation insurance. So, if you are an independent contractor and are not part of the construction industry, you may not have to purchase Workers’ Compensation insurance in Florida.
As the main contractor, you are also responsible for ensuring that your subcontractors are covered. You don’t have to purchase coverage for them, just check that they’re covered. To learn more about your responsibilities as a contractor regarding coverage for subcontractors, speak with our Florida small business Workers’ Compensation insurance brokers.
Can Employers File for an Exemption from Workers’ Compensation Insurance in Florida?
In Florida, certain parties can file for an exemption from Workers’ Compensation coverage. Generally, this perk is reserved for corporation owners and limited liability company (LLC) members. Filing for an exemption from Workers’ Compensation insurance coverage can reduce the monthly premiums for your business by lowering the number of employees covered by a policy.
Corporations in the Construction Industry
To be eligible for an exemption from Workers’ Compensation insurance as an owner of a corporation in the construction industry in Florida, you must meet the necessary criteria. First, your corporation must be registered with the Florida Department of State, Division of Corporations and must be listed as active. You must also be listed as an officer of the corporation with the Florida Department of State and own at least 10% of the corporation. There may not be a current stop-work order or working-in-violation order against your corporation when you file for an exemption. No more than three corporation officers may be exempt from Workers’ Compensation coverage. There is a $50 fee upon filing.
Limited Liability Companies in the Construction Industry
Members of LLCs that are part of the construction industry in Florida may be eligible to file for an exemption from Workers’ Compensation coverage. First, an LLC must be registered with the Florida Department of State, Division of Corporations and must be listed as active. In order to qualify for an exemption, LLC members must own at least 10% of an LLC. There may not be a current stop-work order or working-in-violation order against your LLC at the time of filing. No more than three members of an LLC may be exempt from Workers’ Compensation coverage at the same time. There is a $50 fee upon filing for an exemption from Workers’ Compensation insurance in Florida.
Corporations Not in the Construction Industry
Corporation owners outside the construction industry may file for an exemption from Workers’ Compensation insurance in Florida. To do so, your corporation must be registered with the Florida Department of State, Division of Corporations and listed as active. The Florida Department of State must list you as an officer of the corporation. There cannot be a stop-work order or working-in-violation order against your corporation at the time of filing.
Limited Liability Companies Not in the Construction Industry
Certain LLC members not in the construction industry may be able to exempt themselves from Workers’ Compensation insurance in Florida. To do so, your LLC must be registered with the Florida Department of State, Division of Corporations and listed as active. To be exempt, you must also own at least 10% of an LLC. At any time, no more than ten LLC members within a company can be exempt from Workers’ Compensation insurance coverage in Florida. Finally, there cannot be a stop-work order or working-in-violation order against your LLC when you file for an exemption.
Should Employers File for an Exemption from Workers’ Compensation Insurance in Florida?
Although filing for an exemption from Workers’ Compensation insurance might reduce your policy premiums, it may also leave you at risk. Instead of trying to lower the cost of insurance by filing for an exemption, find better coverage by partnering with our Florida Workers’ Compensation insurance brokers.
Certain LLC members or corporation owners might consider filing for an exemption from Workers’ Compensation insurance to cut costs. By reducing the number of employees covered under a Workers’ Compensation insurance policy, you can also reduce the cost of premiums. While this can be appealing for employers in Florida, it can also mean taking a pretty big risk.
When your Workers’ Compensation insurance exemption application is approved in Florida, you’re no longer covered. So, if you sustain a workplace injury, you cannot file a claim with your company’s Workers’ Compensation insurance carrier. This is the case even if you are an employer. Once you file for an exemption, you’re not covered. If you change your mind and wish to be covered in the future, you can let your exemption lapse and choose not to renew it.
Exempting yourself from Workers’ Compensation insurance coverage might not be wise, especially if you work in the construction industry or are heavily involved in the day-to-day happenings of your company. Workplace accidents might happen anywhere, and it’s important to be prepared and protected.
If your company is concerned about the cost of coverage and that is why you’re considering filing for an exemption, reach out to our Florida Workers’ Compensation insurance brokers. Our professionals can help you find an affordable insurance plan that protects your company and its employees at a more comfortable rate.
Do Employers Pay for Workers’ Compensation Insurance Premiums in Florida?
One of the biggest questions employers might have about Workers’ Compensation insurance is, who pays for it? It protects both employers and employees, so do you split the cost? In Florida and elsewhere, Workers’ Compensation insurance premiums are not a shared expense. Employers, and employers alone, pay for Workers’ Compensation insurance coverage in Florida.
As an employer, it is your responsibility to find, purchase, and maintain Workers’ Compensation insurance in Florida, if required. Employees are not involved in the process logistically, administratively, or financially. On that last part, Florida is very clear.
According to Florida Statute § 440.105(4)(a)(2), employers may not intentionally deduct from employees’ checks for the purposes of covering Workers’ Compensation insurance premiums.
Finding Workers’ Compensation insurance without help can be difficult for employers in Florida. To make things easier, employers can turn to our Florida Workers’ Compensation insurance brokers. Our brokers can take on the challenge of finding the right coverage for business that protects employers and employees without causing financial strain.
What Determines the Cost of Workers’ Compensation Insurance in Florida?
Several factors are considered when determining the cost of Workers’ Compensation insurance policies in Florida. For example, a business’s payroll, age, history, and industry, might all indicate risk to an insurance company. Understanding how these factors influence price is important so that employers get a clearer idea of the potential cost of coverage for their companies in Florida.
Age
One of the first factors an insurance company might assess when pricing a Workers’ Compensation insurance policy is a company’s age. The younger and newer a business is, the higher the risk to insure. Insurance companies like to know what they’re getting into when they insure a business. Younger companies may not have had sufficient time to prove themselves as dedicated to maintaining safe working environments for employees. While that may seem unfair, it’s relatively common for Workers’ Compensation insurance companies to subject newer businesses to higher premiums in Florida.
Payroll
Payroll is a big indicator of the cost of Workers’ Compensation coverage in Florida. The more workers you employ, the higher the chances that someone might sustain a work-related injury. Payroll is so significant that it is part of the equation insurance companies use to calculate risk and determine the price of policy premiums. Generally, the higher the number of employees, the higher the monthly premiums. Unfortunately, payroll is one of those things that often changes, as new employees are hired and others move on. To prevent payroll from totally deciding the cost of coverage, find a pay-as-you-go plan from our Florida Workers’ Compensation insurance brokers. The price of pay-as-you-go plans update as your payroll does, meaning you don’t have to pay more than you need to for sufficient coverage.
Industry
When determining the cost of Workers’ Compensation insurance, a business’s industry matters. Like construction, certain industries are considered at a higher risk for workplace injuries. Industries are often broad categories, broken down into specific codes by the National Council on Compensation Insurance (NCCI). Industry codes correspond with rates, which become part of the equation for calculating the cost of Workers’ Compensation insurance in Florida.
History
If your company has a history of workplace accidents, it may face higher Workers’ Compensation insurance premiums in Florida. Typically, insurance companies view businesses with previous employee injuries as a higher risk to insure. Multiple workplace accidents might hike your quotes up substantially. Some insurers will increase premiums as work-related injuries occur.
How Can Employers Figure Out Their Industry in Florida?
In some cases, a business’s industry is quite clear. In others, that’s not the case. Figuring out your industry is important, especially if your work is construction-related. If it is, you will likely be required to purchase Workers’ Compensation insurance in Florida. If you want to determine your exact industry, our skilled Florida Workers’ Compensation insurance brokers can help.
As an employer, it’s crucial to know the industry your company operates in. In Florida, certain types of companies are considered part of the construction industry, which might come as a surprise to employers. For example, landscaping companies are considered part of the construction industry in Florida, as are certain types of cleaning, HVAC installation, and burglar or fire alarm installation companies.
Because it might not always be obvious whether or not a company is part of the construction industry, employers might be unsure of Workers’ Compensation insurance requirements. Our Florida Workers’ Compensation insurance brokers can assess your business’s operations to determine exactly what industry you are in.
How Can Employers Determine Their Workers’ Compensation Code and Rate in Florida?
In Florida, each type of business has a code and corresponding rate that helps determine the price of coverage. Workers’ Compensation insurance codes are crucial parts of the equation carriers use when calculating the price of policies. Learning your Workers’ Compensation code and its corresponding rate is important, to better understand where you stand in Florida.
Florida uses the Workers’ Compensation codes from the National Council on Compensation Insurance. Each classification code is paired with a rate. The NCCI regularly assesses risk factors of certain industries and specific lines of work to update rates as necessary. The classification code and corresponding rate given to your business by the NCCI are concrete numbers used by insurance carriers to help calculate the cost of coverage. At the same time, subjective factors are also included in that equation. So, while Workers’ Compensation codes and rates from the NCCI do not exclusively determine the cost of coverage, knowing yours can help you estimate the cost.
Your NCCI code and rate might change if your business goes in another direction. Ask our Florida Workers’ Compensation insurance brokers to learn your current NCCI Workers’ Compensation code and rate. Our professionals can compare your current line of work with the NCCI’s codes and rates to identify those that best suit your business. If anything changes, our brokers can keep you updated.
Do Out-of-State Employers Need Workers’ Compensation Insurance in Florida?
Suppose you are an out-of-state employer that employs workers in Florida, even if only for a short time. In that case, you may have to comply with Florida’s Workers’ Compensation insurance requirements, not just your state’s. This can be a complicated subject, so it’s important for employers to contact our skilled brokers with any questions.
Any out-of-state employer within the construction industry must purchase a Workers’ Compensation insurance policy in Florida for the time they employ workers there. This is the case, regardless of payroll.
Out-of-state employers not in the construction industry must purchase a Workers’ Compensation insurance policy in Florida if they employ four or more workers in Florida. According to Florida Statute § 440.10(1)(g), out-of-state employers must use class codes, rates, rules, and manuals that adhere to Florida’s rules regarding Workers’ Compensation insurance coverage. These requirements only apply to out-of-state employers whose employees are engaged in work in Florida, according to specific standards. To better understand these standards and learn if they apply to your business, speak with our Florida Workers’ Compensation insurance brokers for clarification.
Do Employers Need to Inform Employees About Workers’ Compensation Insurance in Florida?
Just as it’s mandatory for you to purchase Workers’ Compensation insurance if you meet the criteria in Florida, it is also mandatory that you inform your employees of insurance. Employers have to tell employees about their Workers’ Compensation insurance coverage. If you don’t because you’re uninsured, a worker might report you.
Having Workers’ Compensation insurance, if mandated in Florida, is important. Not only will it protect your business in the event of a work-related injury, but it will also protect you from potential consequences. Florida businesses must provide appropriate information and resources regarding Workers’ Compensation insurance and make this information easily accessible to employees. Suppose employees notice that a company has not properly informed them of their Workers’ Compensation insurance benefits. In that case, they might report their employer to the Division of Workers’ Compensation in Florida.
This can result in serious penalties for Florida employers that they might not have anticipated. Because Florida’s Workers’ Compensation insurance laws are complex, an employer might not know coverage requirements. Hiring more employees or changing a business’s direction could qualify you for Workers’ Compensation insurance seemingly overnight. If an employee realizes this lapse, they might report you. The same might happen if you don’t inform your employees about coverage. Our Florida Workers’ Compensation insurance brokers can explain the ins and outs of your plan and determine your coverage requirements so that you can keep employees properly informed.
Can Employers Get Workers’ Compensation Insurance in Florida if Not Required?
Though many businesses are required to purchase Workers’ Compensation insurance in Florida, some are not. If yours is one of those that is not mandated to have coverage, you might choose to forego it. That’s never wise. Opting into the Workers’ Compensation insurance system can protect your company, even if you’re not required to maintain coverage in Florida.
At first glance, you might not see a need for Workers’ Compensation insurance if you’re not required to purchase it in Florida. However, Workers’ Compensation insurance benefits all businesses, regardless of obligation. Because of that, any business can opt into the system if they choose. And they should.
Purchasing Workers’ Compensation insurance keeps employers and their employees protected. Insurance can cover the cost of injuries after a workplace accident, shifting liability away from your business. Employees might feel more comfortable working for your business, knowing that your Workers’ Compensation insurance policy is there in case of a workplace injury.
Workers’ Compensation insurance can provide security and safety for all types of businesses in Florida, regardless of age, payroll, industry, or history. As an employer, you can keep your workers safe by getting Workers’ Compensation insurance they can rely on.
Penalties for Non-Compliance with Florida’s Workers’ Compensation Insurance Requirements
Employers that are required to purchase Workers’ Compensation insurance and fail to may be penalized in Florida. Stop-work orders might harm your business’s reputation and finances, halting operations and impacting customers’ opinions. Financial penalties in the form of fines can be steep. In some cases, employers that fail to purchase Workers’ Compensation insurance when required might even face jail time in Florida.
Financial Penalties and Legal Consequences
Florida takes non-compliance with Workers’ Compensation insurance laws seriously. Because of that, employers that are found to be non-compliant can face expensive penalties. Florida may impose a penalty equal to twice the amount in premiums you would have paid had you been insured for any period you were uninsured over the past two years.
If warnings and fines are ignored, and employers remain non-compliant with Florida’s Workers’ Compensation insurance laws, they may face jail time. Non-compliance is a serious matter with equally serious consequences for employers in Florida.
Stop-Work Orders and Working-in-Violation Orders
When an employer is found to be without the necessary Workers’ Compensation insurance coverage in Florida, they may be issued a stop-work order or a working-in-violation order. Essentially, this means your business must stop operations entirely until it gets Workers’ Compensation insurance and settles any outstanding fines with the Division of Workers’ Compensation. To employees and clients, stop-work orders make it known that your business does not have the proper insurance.
This might tarnish your business’s reputation and finances. Not only will you have to find coverage fast, but you will also have to halt operations and pause your source of income. Employees might be upset regarding the lack of coverage, and customers might be disappointed. Stop-work orders can be a severe consequence of non-compliance with Florida’s Workers’ Compensation insurance requirements.
Do Employers Pay Workers’ Compensation Settlements to Employees?
Suppose you have adequate Workers’ Compensation insurance in Florida. In that case, you will not be financially liable for an employee’s damages after a workplace injury. Because you pay premiums to your insurance carrier, your carrier will cover any settlement awarded to an injured worker.
Employers don’t pay Workers’ Compensation settlements to employees. That is handled by an employer’s Workers’ Compensation insurance carrier. Filing a Workers’ Compensation insurance claim in Florida is often the exclusive remedy for injured employees. That means employers may not have to contribute towards a settlement as long as they are covered.
That doesn’t mean employers are completely uninvolved in the claims process. A fraudulent Workers’ Compensation insurance claim might unnecessarily cause your premiums to spike. Because of that, getting a Workers’ Compensation insurance policy from a carrier that prioritizes open communication and transparency with policyholders is important. That way, you can stay appropriately updated on the claims process as it unfolds. While employers don’t pay Workers’ Compensation settlements themselves, they are not totally uninvolved in the claims process.
How Can Employers Find Affordable Workers’ Compensation Insurance in Florida?
Finding affordable, comprehensive Workers’ Compensation insurance in Florida might seem difficult, especially if your employees are at a higher risk of sustaining workplace injuries. While that concern is understandable, finding the right policy is possible when you partner with our experienced brokers. Our Florida Workers’ Compensation insurance brokers can pair employers with a policy that protects them at the right price.
Although certain factors put a business at a higher risk of workplace injuries, that doesn’t mean it’s impossible to find affordable coverage. It just means that you have to know where to look. Our skilled brokers have relationships with Workers’ Compensation insurance carriers that don’t require audits, contracts, or deposits. Employers can also explore the benefits of a pay-as-you-go insurance policy that quickly accounts for changes in payroll.
Once you call our Florida Workers’ Compensation insurance brokers and provide them with the necessary information, they can respond with a quote within a day or so. Together, brokers and employers can evaluate quotes and policies to determine the best choice at the best rate.
Getting Workers’ Compensation insurance is important for employers in Florida. Insurance protects employers from financial liability in the event of a workplace injury. It makes employees feel safer and more valued. Not to mention, the consequences for non-compliance with Florida’s Workers’ Compensation are often severe and can be far more expensive than monthly premiums. So, to find the coverage you need to stay protected as an employer, consult our Florida Workers’ Compensation insurance brokers for help.
Employers Can Call Our Florida Workers’ Compensation Insurance Brokers Today
If you’re a Florida employer in need of Workers’ Compensation insurance coverage, our brokers can help. To learn more about the Florida Workers’ Compensation insurance brokers at NPN Brokers, call us today at (561) 990-3022.
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