Workers’ Compensation Policy Coverage for Small Businesses in Florida

The price that businesses must pay for worker’s compensation insurance in Florida varies based on the industry that the company does work in, the size of the company, and the company’s history with worker’s compensation claims. Since the methods that the worker’s compensation insurance industry uses to determine the prices of policies are strict, small businesses are often daunted by the pursuit of getting policies for their employees.

However, owners of small businesses in Florida can take comfort in the fact that they can get fast and easy quotes on worker’s compensation policies from NPN Brokers. By simply entering some basic information about their company and employees, owners of small businesses can get quotes on comprehensive and affordable worker’s compensation policies for their Florida-based businesses. Call NPN Brokers (561) 990-3022 or visit us online to learn more.

Are Businesses of All Sizes Required to Carry a Workers’ Compensation Insurance Policy in Florida?

All businesses in the State of Florida that employ four or more people (either full-time or part-time) must provide workers’ compensation insurance for employees. There are a few exceptions to this requirement. Those exceptions are:

• Construction-related businesses must carry workers’ compensation insurance if they employ at least one person; subcontractors are considered their own employee and must buy workers’ comp insurance for themselves. Construction-related fields are usually those that require manual labor; landscaping and tree removal, plumbing, electrical work, heating and ventilation, roofing and siding, carpentry, and other types of work are included in this category. Construction-related businesses are able to exempt up to three corporate officers if each one can demonstrate that they own at least 10% of the company.
• Agricultural companies must carry workers’ compensation insurance if they have at least six year-round employees or at least 12 seasonal employees.
• Sole proprietors and partners of businesses are excluded from workers’ comp coverage requirements. However, they are able to purchase coverage by filing for election of coverage.

Failure to Maintain a Workers’ Comp Policy

Florida businesses are required by law to carry workers’ compensation insurance. There are many consequences, both legal and otherwise, that businesses can face if they fail to meet this requirement.

If an employer fails to carry workers’ compensation insurance for its employees, those employees are able to sue their employer for costs incurred as a result of any injuries that they suffer while on the job. Businesses that fail to carry workers’ compensation insurance may also be subject to fines from the State of Florida. These fines may be either $1,000 or twice the amount that the company would have paid in premiums if they had been paying for workers’ compensation insurance.

One of the most drastic consequences of failing to get workers’ compensation insurance is a loss of the ability to conduct business. Businesses that fail to carry workers’ compensation insurance may be issued a stop-work order. This order will prevent them from doing any business until they comply with Florida’s workers’ compensation policies. Continuing to work after the issuance of a stop-work order carries additional penalties.

Companies also put themselves at risk for civil actions or criminal charges if they fail to report employee injuries, try to ensure that employee claims are denied, or threaten to fire employees that file workers’ compensation claims. If an employer tries to avoid getting a policy for an employee by declaring that they are an independent contractor, the employer may be subject to a $5,000 fine and fraud charges.

What Workers’ Compensation Insurance Covers

Workers’ compensation insurance policies cover the costs that are incurred by an employee when they are injured on the job. These costs may be medical costs (such as hospital stays, physical therapy, ambulances, or medication) or a partial recovery of any wages lost due to an employee’s inability to work.

Workers’ compensation policies also cover costs related to death if an employee dies while at work; the benefits are paid to the deceased employee’s family. Death benefits may include up to $7,500 for funeral expenses, up to $150,000 for the deceased employee’s dependents, and education benefits for the surviving spouse.

Employees are not eligible to receive workers’ compensation benefits if their injuries happen while they are not observing necessary safety rules or using proper safety equipment, if they are drunk or otherwise under the influence, or if they intentionally inflict the injury upon themselves.

Employees are subject to a statute of limitations following any injuries for which they seek to file a workers’ compensation claim. Workers’ comp claims must be filed within two years of the employee’s injury. Exceptions to the two-year statute of limitations are made if the worker is a minor or mentally incompetent, was misled about their coverage by their employer, or was not properly informed about their rights by the insurance carrier.

How Much Does Worker’s Compensation Insurance Cost for a Small Businesses in Florida?

The National Council on Compensation Insurance is the centralized rating bureau that sets the prices of insurance policies for various industries. They set prices by classifying similar jobs together into class codes, each of which is largely determined by the level of risk associated with each job; premiums for jobs with risky duties are higher than those with a lower risk. Rates are provided per $100 of an employer’s payroll.

In the agricultural industry, companies must have worker’s compensation insurance if they have at least six full-time employees and 12 seasonal employees. However, companies in the construction industry (as well as construction-related fields such as carpentry, electrical work, landscaping and tree removal, and much more) must have worker’s compensation policies if they have at least one employee. Therefore, virtually all small businesses that do work in the construction industry or a related field must have worker’s compensation policies. Corporate officers that work for a company may be exempt from needing worker’s compensation insurance if it can be demonstrated that they have at least a 10 percent ownership of the company. Companies that do work in industries that are not agriculture or construction must get worker’s compensation policies if they have at least four employees.

Small businesses can anticipate higher prices on worker’s compensation policies if they do work in an industry that carries a high level of risk. Prices of worker’s compensation policies are determined by the level of risk associated with each job; the level of risk is assessed and put into a classification system by the National Council of Compensation Insurance (NCCI). Since risky jobs are more likely to result in injuries and therefore worker’s compensation claims, they carry a higher price.

Small businesses that have filed worker’s compensation claims in the past can also expect to pay higher rates for their policies. (A business’s history with filing worker’s compensation claims is known as their “experience modification factor.”) Both the number and severity of a business’s past worker’s compensation claims will determine the price that they can expect to pay for their policies. The amount of time that has a business has been in operation can also affect the price that they will pay for policies—businesses that have existed for three years or less can expect to pay higher rates for their policies.

If you would like a quote on a worker’s compensation policy without having to wait, visit the website of NPN Brokers today. Enter basic details about your small business and its employees and you can get a quote on policies sent back to you quickly and easily.

Penalties for Failing to Get a Worker’s Compensation Policy

Small businesses that are based in Florida should be aware of the penalties that they may face if they fail to get worker’s compensation policies for their employees. Florida employs investigators whose job it is to look into whether companies are complying with the statutes surrounding worker’s compensation policies in Florida’s Administrative Code. If they discover that a company is not complying with Florida’s worker’s compensation requirements, they may issue penalties that can damage a business’s ability to make a profit.

One penalty that the State of Florida may issue against businesses that don’t have worker’s compensation policies for their employees is fines, which may be up to $1,000 per employee or twice the amount that they would have paid in premiums. Businesses that don’t get worker’s compensation policies may also be issued a stop-work order. This will force them to stop all work operations until they come into compliance with Florida’s worker compensation insurance statutes.

Also, companies that don’t have worker’s compensation policies for their employees may face lawsuits from employees that are injured while working. These lawsuits will force the employer to pay for the injured employee’s medical costs, lost wages, and even pain and suffering out-of-pocket.

It is common for employers to attempt to lie about the status of their employees—they may claim that their employees are independent contractors so that they can avoid having to pay for worker’s compensation policies for them. Doing so can result in a fine of $5,000 and, since it is a type of insurance fraud, imprisonment. Employers may also criminal or civil actions for actively failing to report injuries suffered by employees, intimidating or dissuading employees against claiming worker’s compensation benefits or retaliating against employees for filing claims following an injury.

Contact NPN Brokers to Get Worker’s Comp Insurance for Your Small Business

If you are the owner of a small business that is based in Florida, know that you can use NPN Brokers to find a worker’s compensation policy that suits your company’s budget. Getting a quote is easy and only take a few minutes. Get in touch with NPN Brokers to learn more. You can call (561) 990-3022 or visit NPN Brokers online.