A Florida Program that Really Works!!
Written on September 28, 2010 at 6:50 pm, by HRDyn
Florida requires all businesses with four or more employees (business owners can request an exemption for themselves) must carry Workers’ Compensation Insurance. A construction industry business with one or more full or part-time employees must have coverage.
It might be hard to imagine but the Workers’ Comp Insurance in Florida is a good program providing businesses with risk protection for on-the-job injuries and fatalities at a good price. The employer must maintain a safe work place and in many cases provide safety training.
In 2003 the Florida Legislature approved a 182 page revision to the Workers’ Compensation laws. At that time Florida’s Workers’ Compensation Insurance premiums were the 2nd highest in the nation. Since the reforms were enacted, Florida’s rates are the 5th lowest in the nation having been reduced every year since 2003 with a cumulative decrease of 65% in the seven years.
How can it be?….. an insurance product, in Florida, costs 65% less than seven years ago? Simple…tort reform!
The 2003 act limits lawyer fees to a percentage (20-25%) of any monetary award to workers’ comp claimants. With permanent partial disability claims (the most costly) the attorney fees are based on the amount of money ultimately awarded to the claimant above the initial offer made by the insurance company.
Now the insurers to have an incentive to make their best settlement at the beginning and discouraged attorney from representing claimants when it is unlikely legislation will improve on the award. A side benefit with less attorney involvement is cases are settled faster allowing the injured worker to make a faster return to the work force.
As in most states, Florida’s Workers’ Compensation program ensures an employee, who is injured on the job, regardless of who was at fault, prompt payments covering medical costs and lost wages. Workers can obtain payment without litigation but they lose their ability to sue the employer for a larger sum.
The 2003 reform act also addressed limiting medical costs. For example, prior to 2003 a worker could get second opinions from a variety of specialists; now a 2nd opinion is limited to one specialist.
The 2003 reform act resulted in a good workers’ comp program in Florida where rates are 30-40% lower than the neighboring states of GA, AL, LA, and MI. For most businesses workers’ comp insurance is mandatory, but we feel every business should have this protection. The cost is well worth the protection as one accident can put a company out of business.
One final thought. If the tort reform to limit attorney’s fees has reduced costs for workers’ comp with 7 years of history of fair settlements to the injured personnel, might not these reforms be applied nationwide to the health care industry?