Florida Insurance commissioner orders a 1% reduction in workers’ comp rates

Construction workers perform tasks on an apartment building in 2019. (Photo by John Raoux/The Associated Press)

Not all insurance rates in Florida are increasing.

Florida Insurance Commissioner Mike Yaworsky on Monday ordered an average 1% rate decrease in workers’ compensation rates effective Jan. 1.

The decrease applies to both new workers’ compensation policies as well as renewals.

“I’m pleased to announce that Florida businesses will see a further reduction in workers’ compensation rates for the eighth consecutive year, Yaworsky said in a press release.

“Following historic legislative reforms in this space, it is abundantly clear that the workers’ compensation market in Florida is stable and competitive. A further reduction in workers compensation rates will assist new and existing businesses in Florida find success.” 

It’s the eighth consecutive year in which workers’ compensation rates have been ordered reduced by the state’s insurance commissioner, although it’s the smallest rate decrease ordered in that span. 

Increasing exemptions?

Workers’ compensation is a no-fault system that aims to protect employers from getting sued by injured employees and, in exchange, employers provide employees injured on the job the care they need to return to work. Employers are required to provide compensation for lost wages if an employee misses more than eight days of work due to an on-the-job injury.

Most employers in Florida are required to carry workers’ compensation insurance but there are exceptions for businesses with four or fewer employees and for construction companies with four or fewer officers.

While those firms aren’t mandated to carry the coverage, they are required to file for an exemption with the state.

National Federation of Independent Business Florida Executive Director Bill Herrle said Florida’s workers compensation market is “good” but noted that it may be time to take a closer look at the exemptions to allow more businesses to qualify. 

“Clearly, we have a labor market that is going through massive changes and it’s a fair time to ask if workers’ comp really matches what’s going on out there,” Herrle told the Florida Phoenix in a phone call — adding that whatever costs businesses save by foregoing coverage could be used to increase employees’ wages.

Workers’ compensation affects a large and disparate group of interests, including business groups, labor unions, insurance companies, plaintiffs’ attorneys, and injured workers.

Because of that, workers’ comp bills in the Florida Legislature attract a spate of special interests, and getting changes passed through the Legislature and signed into law isn’t always easy.

“We’re not contemplating a Chapter 440 rewrite here,” Herrle said. That’s the workers’ compensation statute.