Employees sometimes get injured on the job. When this happens, workers’ compensation insurance can cover the associated costs. This important insurance protects employees and business owners alike by preventing accidents from resulting in unmanageable expenses.
When it comes to workers’ compensation insurance, Florida is what is known as an NCCI state. Interestingly, the National Council on Compensation Insurance is headquartered right here in Boca Raton Florida.
If you are among the many employers in this Florida city, an independent insurance agent can help you find the best and most affordable workers’ compensation policy to cover your business. Contact an insurance agent in Boca Raton to learn more.
Are Businesses in Boca Raton, FL, Required to Have Workers’ Compensation Insurance?
Many Boca Raton businesses are required by Florida law to carry worker’s compensation insurance. The state mandates that the following businesses must purchase this coverage.
- Construction businesses: If you have at least one employee.
- Agricultural businesses: If you have at least six regular employees and/or 12 seasonal employees who work at least 30 days out of the year.
- All other businesses: If you have at least four employees.
You are not required to purchase coverage for sole proprietors, LLC members, or partners in non-construction companies, but you can if you want to. Out-of-state businesses are required to purchase coverage from a Florida-licensed provider.
Employer compliance with these requirements is enforced by the Florida Division of Workers’ Compensation.
Failure to carry required coverage opens your business up to potential lawsuits. It can also result in your business being issued a Stop Work Order and a fine of two times what you would have paid for coverage over the last two years or $1,000, whichever is greater. The Stop Work Order will not be lifted until all fines are paid and coverage has been purchased.
How Much Does Workers’ Compensation Insurance Cost in Boca Raton?
Workers’ compensation rates can vary significantly from one business to the next. Costs are calculated based on these points.
- Your company’s overall payroll amount
- The number of employees you have
- The types of jobs your employees do and the likelihood they will be hurt while doing them
- Your company’s claims history and safety record
Every occupation is assigned a classification code and coverage rates per every $100 in payroll for each of these class codes are regulated by the Florida Division of Workers’ Compensation.
Insurance companies are required to use these designated base rates when calculating costs, but they are permitted to offer their policyholders discounts, credits, dividends, and incentives. That’s why it pays to compare rates before making a purchase.
Base rate examples
Let’s take a look at the base rates per every $50,000 in employee payroll for three jobs commonly found in Boca Raton, FL.
- Tree trimming, pruning, and removal services: $5,450/year
- Animal shelter workers: $910/year
- Clerical and office employees: $85/year
As you can see, the rates for these different jobs vary significantly. Because office employees have a very low risk of being injured on the job, rates for coverage are nominal. However, because tree trimmers risk significant injuries, rates are much higher.
The easiest way to find out how much a workers’ compensation policy will cost for your business is to request a few customized quotes. A local independent insurance agent can do this on your behalf.
What Can Boca Raton Business Owners Do to Lower Their Insurance Rates?
Business owners cannot change base rates for the jobs their employees do, but there are things they can do to lower their coverage costs through discounts.
Maintain a drug-free workplace
The state of Florida allows insurance companies to provide rates discounts of up to 5% for businesses that have a drug-free workplace. These businesses will be required to do mandatory drug testing at intervals designated by their insurance company.
Companies that apply for the drug-free workplace discount will need to pay for employee drug testing themselves. For businesses with high coverage costs, such as tree trimmers and roofers, the potential discounts will be far greater than the cost for mandatory drug testing.
For instance, as mentioned earlier, a tree-trimmer making $50,000 a year would cost about $5,450 a year to cover. With a drug free discount, this cost can be reduced to $4,905, for a savings of $545 just for this one employee. A typical drug test cost about $30 to run.
Implement an employee safety program
By providing your employees with mandatory safety training and instructions on how to use provided safety equipment, you can qualify for a discount of up to 2%.
For the tree trimmer in the example above, this can mean savings of $109 a year just for that one employee. Safety programs are inexpensive to run and are good for your company’s reputation and safety record.
Have a low experience modification factor
Experience modifiers are assigned to certain companies and are regulated by the NCCI. In Florida, you can qualify for an experience modification factor (or X-mod) if your company has spent more than $10,000 in premiums over the last two years.
The experience modifier is a number ranging from 0 to 2. If your company’s safety record is comparable to the average record for businesses in your industry sector, your factor will be 1. If your safety record is better, it will be less than one, and if worse, it will be greater than 1.
Therefore, if your company has a very solid safety rating and your modification factor is 0.85, your company will be assessed at 85% of the base rate for each job. So, for example, the base rate for the tree trimmer would drop from $5,450 to $4,633.
Conversely, if your company’s safety record isn’t very good and you’ve experienced a few serious employee injuries in the past couple years, your rating may be 1.15, which would mean that your base rates would increase 15%, so the tree trimmer’s costs would go from $5,450 to $6,268.
That is way maintaining a safe workplace is so important.
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What Does Boca Raton Workers’ Compensation Insurance Cover?
Workers’ compensation insurance is designed to cover the various costs that are associated with on-the-job injuries and occupational illnesses. You can expect your policy to cover the following:
- Medical treatments: Workers’ compensation covers all necessary medical care related to occupational illnesses and injuries. This includes ambulance rides, hospital stays, medical appointments, follow-up care, prescription medications, physical therapy, and other treatments. Employees will need to coordinate their care through an authorized provider.
- Travel reimbursement: Workers’ compensation can reimburse employees for miles driven to and from medical appointments and the pharmacy. Reimbursement rates and terms are determined by each insurance company individually.
- Temporary disability: If an employee needs to take more than seven consecutive days to recuperate from a work-related injury, they will be able to collect a weekly benefit of two-thirds their average weekly pay until they can return to work. If they must remain out of work for at least 21 days, the first seven days will be covered, otherwise, they are not.
- Permanent disability: If a work-related injury is so severe that the injured worker will be unable to ever return to their job, workers’ compensation insurance can provide them with a weekly benefit of two-third their average wage until they reach the age of 75. These benefits come with an annual 3% cost-of-living increase until the employee reaches the age of 62.
- Survivor benefits: If a work-related injury or illness leads to a fatality, workers’ compensation can ease the financial burden on surviving family member by covering burial expenses up to $7,500, offering education reimbursement benefits to the employee’s spouse, and by providing the employee’s spouse and dependents with compensation of two-thirds the employee’s average weekly wages for up to $150,000.
Weekly disability benefits cannot exceed the state’s average weekly, as determined by the Florida Department of Economic Opportunity. As of January 1, 2021, the maximum weekly disability payment is set at $1,011. This rate is updated every year on the first of January.
You can learn more about workers’ compensation insurance by speaking with an independent insurance agent in Boca Raton.
Where Can Boca Raton Business Owners Buy Workers’ Compensation Coverage?
Workers’ compensation insurance can be purchased through any of the many commercial providers that are authorized to sell Florida workers’ compensation policies.
High-risk businesses that are unable to obtain coverage through a commercial provider can purchase their policies through the Florida Workers’ Compensation Joint Underwriting Association (FWCJUA). These policies will be a lot more expensive, but coverage is guaranteed.
Alternatively, your company may opt to self-insure, though you will need to apply for approval and demonstrate that your business has the financial means to do so.
Most businesses in Boca Raton purchase coverage through a commercial provider.
Find the Best Workers’ Compensation Insurance in Boca Raton, FL
An independent insurance agent can help you find the right workers’ compensation policy to cover your Boca Raton business. These agents can obtain customized quotes from a selection of top-rated insurance providers that specialize in covering businesses like yours. That way, you can be sure you are getting the coverage you need at a competitive price.
Discover how easy it can be to find an ideal workers’ compensation policy for your business. Contact an insurance agent in Boca Raton, FL, to get started.
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