Florida Workers' Compensation Insurance

In Florida, most businesses with four or more employees must carry a workers’ compensation policy. Got questions about how to get coverage, or how workers’ comp works? WorkCompOne has you covered.

Click on the links below to jump to that section, or scroll down for everything you need to know about buying work comp insurance in the Sunshine State.

Jump to:

• Florida’s work comp system
• Workers’ compensation insurance in Florida
• How to buy a work comp policy
• How much workers’ comp coverage costs in Florida

Need a workers’ compensation policy today? Get a quote now.

Workers’ Compensation in Florida

Workers’ compensation provides legal protection to employees when they suffer injury or illness as a result of their job. When a claim is submitted, workers’ compensation ensures that the employee’s medical treatment or rehabilitation is paid.

This covers disability, too. If the employee is unable to work either temporarily or permanently, workers’ comp may also dictate the percentage of lost wages the employee receives.

In Florida, workers’ compensation laws apply only to businesses with four or more employees. This means that very small businesses may be exempt from the state’s workers’ compensation laws.

However, this doesn’t mean that it’s a good idea to go without workers’ comp insurance in Florida, even if you’re not mandated to have coverage. If an employee is injured on the job and you don’t have workers’ compensation insurance, they may be able to sue your business for medical care, damages, and lost wages.

Employers subject to Florida workers’ compensation laws are required to carry a current workers’ compensation insurance policy. Failure to do so can result in some steep penalties and fines for your company.

Florida Workers’ Comp Insurance Requirements

Workers’ compensation insurance is a type of commercial insurance policy that covers the cost of workplace injuries at your business in Florida.

By purchasing a policy, an employer can file an insurance claim when a worker is injured. The carrier then compensates the employee for medical bills and lost wages.The policy would also pay the employer’s legal fees if the employee sued for additional damages.

In Florida, businesses must carry workers' compensation insurance if they have four or more employees. This includes all types of employees, including:

• Part-time workers
• Full-time workers
• Sole proprietors
• Corporate officers
• LLC members

However, there are some industry-specific exceptions to these standard Florida workers’ compensation insurance requirements:

• Construction – Businesses with at least one part- or full-time employee must carry coverage. Many trades are classified as construction businesses in Florida.
• Agriculture – Businesses must have coverage if they have at least six employees, instead of the usual four-employee threshold.

>> Small Business Workers’ Compensation: An Introduction for First-Time Employers <<

Contractors

In Florida, like in most other states, contractors are not considered to be employees of your business. This means that they are required to carry their own workers’ compensation insurance policies.

If you are an independent contractor, you might not be covered by the hiring company’s insurance policy and may need to provide proof of work comp. Check whether you'd be considered an employee or an independent contractor and find out what trade contractors need to know before buying work comp insurance.

Also, if you are a contractor and you hire subcontractors to work on a project in Florida, you should confirm that they have their own workers’ comp policy. Otherwise, the subcontractor’s employees become the responsibility of the contractor, who can be held liable in a work comp case.

Owners & Officers

Corporate officers and LLC members may choose to exempt themselves from coverage, if they wish. Doing so can help cut down on the cost of your Florida workers’ compensation insurance policy, particularly if you have a smaller business.

Sole proprietors and partners are not required to have coverage, but can choose to include themselves on a policy. It may be a good idea to cover yourself with a workers’ comp policy if you work in a profession with a risk of workplace injury, such as a landscaping or carpentry business.

Out-of-State Reciprocity

Typically, a Florida workers’ compensation policy is only in effect within the state. If your employees travel across state lines to work, make sure you comply with their work comp requirements. For example, if your business is located near the Georgia state line and you travel across state lines for work, you will need to make sure you follow all of Georgia’s workers’ comp requirements.

However, Florida does have reciprocity with several other states for temporary out-of-state work. In addition, many insurance companies will issue their policies with an All States Endorsement.

This endorsement allows coverage to apply in any non-monopolistic state for temporary work or business-related travel. That means your coverage will apply in every state except:

• Ohio
• Wyoming
• Washington
• North Dakota

Workers’ Compensation Insurance Companies in Florida

Florida has a private market. This means that businesses can purchase a workers' compensation policy from any insurance carrier, broker or agency that is licensed to write in the state.

Another option is to contract with an employee leasing company or professional employer organization (PEO). These companies become the legal employer of your workers and provide work comp coverage, in exchange for a fee. Commercial self-insurance funds are also available, and allow members to share liability for workers’ compensation insurance.

The Florida Workers’ Compensation Joint Underwriting Association administers the state fund, which can write policies that have been declined by private insurance companies. This is the “last resort” for high-risk companies who are unable to get policies from another insurer.

How to Buy Workers’ Comp in Florida

If your business needs a workers’ compensation policy, follow these simple steps to get covered.

1. Check who needs coverage – Determine which employees need to be covered, according to state law.
   
   
2. Calculate your payroll – The insurance policy premium will be based on the payroll of employees covered by the policy; add up the total payroll of employees that need coverage. See this post for more help: How to Calculate Payroll to Find Your Workers’ Compensation Cost
   
   
3. Get a quote – You’ll need to contact an insurance agency or carrier to request a quote. The insurer must be licensed to write workers’ compensation in Florida.
   
   When you request a quote, you'll need to know: the business Employer Identification Number (EIN) number; number of employees and payroll amount(s); business locations and their addresses.
   
   
4. Submit your business details to the insurer — Many traditional insurance agencies and carriers require a phone call or in-person appointment to submit information and discuss any follow-up questions.
   
   Newer agencies are using technology to bind small business workers’ compensation insurance online and on your schedule. Emerging insurtech tools are making every step in the process easier and faster. From getting a quote and a certificate of insurance to making a payment or submitting a claim, you can do it all online. And at WorkCompOne, we offer a simple online process that allows you to get a quote in just a few minutes.
   
   
5. Answer follow-up questions – The insurance rep may ask additional questions about employees, like if they travel for work or routinely work from home. From there, the business will be assigned a classification code. These numeric codes are used nationwide to categorize employees based on their risk of workplace injuries. Knowing them will make it easier to renew or shop for insurance in the future.
   
   
6. Wait to receive your quote – Insurance underwriters determine whether the carrier can cover your business, and how much the premium will cost. All you have to do is wait for your quote. The time it takes to receive your final quote may vary from insurer to insurer.
   
   
7. Review your quote and submit payment to bind – Some insurance companies may not bind coverage until you have made the first payment, while others will issue a policy and send an invoice for payment in the mail. Be sure you understand your payment options when reviewing your quote.

Workers’ Compensation Insurance Quote: What to Expect

Wondering what to expect from your Florida workers’ compensation insurance quote? Here’s a breakdown of what your insurer will send to you.

• Premium – The premium is the annual cost of the workers’ compensation policy. You may have several options for payment plans, such as annually, quarterly, monthly or pay-as-you-go. See Workers’ Compensation Florida Rates below, for more on policy costs.
  
  
• Limits of liability – These outline the extent of coverage, and what amounts a policy will pay out. Just like other types of insurance, you can choose different limits based on your industry and risk of workplace injuries. For more information, read this post all about a workers' compensation insurance policy's limits of liability.
  
  
• Expiration date – Also referred to as an X date, this is the expiration or renewal date for your policy. Your policy will often auto-renew, but it’s a good idea to revisit your business details annually and make sure they’re up-to-date.
  
  
• Experience Modifier – If you’re a new business, this won’t apply. But once you’ve held work comp coverage for several years, the business may be assigned an Experience Modifier. This is also known as an “Experience Mod” or “Ex-Mod “ for short.
  
  This is a number that applies a mandatory debit or credit to your workers’ compensation insurance policy. Basically, you’ll pay a lower rate if you have a good history of workplace safety. But if you have a lot of work injuries at your business, this will affect your Ex-Mod and cause your premiums to increase.
  
  
• Loss runs – This is a claims report that details all claims that have been paid on your behalf over a period of time. Generally, this covers the previous five years of your policy. If you’re a new business, you won’t have a loss run the first time you apply for a Florida workers’ compensation insurance policy.

While Florida insurance costs spiked in 2016, work comp rates have been on the decline every year since. In January 2021, workers' compensation rates in Florida decreased yet again. This is the fifth rate decrease in the state since 2016, thanks to fewer workplace injuries and increased use of automation which have brought down work comp costs.

Overall, workers’ compensation rates in Florida are relatively low compared to national averages. According to a 2018 study by the Oregon Department of Consumer and Business Services, Florida businesses pay $1.50 to $1.99 per $100 in payroll. This means that a policy for a business with $100,000 in payroll could cost less than $200 per month.

Recommended Read: How Much Does Workers' Comp Insurance Cost in Florida?

Workers’ Compensation Florida Rates

Florida is a base rate state, which means the initial insurance rates are mandated by the state. It uses the NCCI (National Council on Compensation Insurance) to recommend base rates for each class code.

Class codes are used to determine the relative risk of injury to each worker. In general, physically demanding or accident-prone jobs have higher rates than office jobs. For example, a landscaping worker has a higher risk of injury than a clerical worker. That means the base rate for a landscaper will be higher.

Then, the base rate is multiplied by company payroll. An Experience Modifier and other discounts may also be applied to calculate the final premium. Here’s what that calculation looks like:

(Base Rate x Payroll x Experience Modifier) +/- Credits/Debits = Premium

For every $100,000 in payroll, a landscaping company with a base rate of $10 and an Experience Modifier of 1.0 would pay $10,000 in premium. A clerical worker with a base rate of $1 and the same Experience Modifier would pay $1,000 in premium.

Tips To Get Cheap Workers’ Comp Insurance in Florida

Compared to most other types of business insurance, Florida workers’ compensation insurance is pretty cheap. But we know that as a small business owner, every dollar counts. So, how can you get cheap workers’ comp insurance in Florida? Here are a few tips.

• Focus on workplace safety – In part, the cost of your work comp insurance in Florida is determined by your workplace accident history. Focusing on workplace safety and preventing accidents is the best way to get cheap rates.
  
  
• Formal training/safety programs – Related to the above point, some insurers will provide you with a discount if you implement former safety training into your workplace. A discount may also be available if you hire a full-time safety officer.
  
  
• Payment plans – You may be able to save on administrative fees and other costs if you pay for your policy yearly instead of choosing a monthly or quarterly payment plan.
  
  
• Payroll reporting – Workers’ comp policies are based on your total yearly payroll. In traditional plans, this means you have to provide a payroll estimate upfront to your insurer. If this isn’t accurate, you may overpay or underpay for your workers’ compensation insurance in Florida.
  
  But with payroll reporting or pay-as-you-go plans, there’s no need to estimate your payroll. Your insurer will work with your payroll provider to pay for your policy automatically, based on the actual amounts you pay to your employees. This is usually done monthly or bimonthly. Payroll reporting reduces overpayments and underpayments.
  
  
• Coverage exemptions – In Florida, you can choose to exempt corporate officers and LLC members from workers’ compensation coverage. This can help you save some money on your yearly premiums.
  
  
• Deductible options – Like other types of insurance policies, you can also choose a higher deductible to reduce the cost of workers’ compensation in Florida. However, this does mean that your company will have higher out-of-pocket costs if an accident does happen, so keep this in mind.