Question: As an officer, how can I become exempt from my company’s Florida workers’ compensation policy?

You will need to file an exemption with the Workers’ Compensation Division of the Florida Department of Financial Services. In our workers’ compensation exemption forms page, we wrote more information about completing these forms and those eligible to be exempt. Here is how we explained this process:

An individual that is an officer of a corporation can elect to be exempt from workers’ compensation coverage. This will exclude the officer from recovering workers’ compensation benefits, but by doing so, the individual may remove their payroll from the total payroll that is used to compute the premium. Many employers choose to be exempt on their workers’ compensation policies to save money on their premium. If the individual meets the requirements for exemption from Florida workers’ compensation insurance, then they can file for exemption using the following forms:

Online Exemption Form

Download the Exemption Form

Download the Exemption Form Instructions

Download the Form to Revoke an Exemption

Question: What types of businesses are classified as in the construction industry for the purpose of Florida workers’ compensation insurance?

We often receive this question. In the definition of businesses required to carry Florida workers’ compensation insurance, there is a distinction in the requirement for workers’ compensation insurance between businesses in construction and those that are not. For administration purposes the definition of “construction industry” in the Florida Statutes means those employers whose operations include and/or are best described by the classifications codes listed below. The descriptions for classifications are included in the workers compensation rating manual approved for use in Florida. Please note that these employers shall be considered in the “construction industry” whether or not they are currently engaged in any of the operations described by the applicable classifications and the classifications also contemplate employers that may potentially engage in such operations. The classification codes listed below should serve only as a guideline to provide direction for properly assigning employers to the “construction industry” and the Department of Labor and Employment Security is responsible for making all determinations of compliance with Florida statutes by individual employers whether or not in the classifications below:

• 0042 Landscape Gardening and Drivers
• 0050 Farm Machinery Operation – By Contractor and Drivers
• 1322 Oil or Gas Well: Cleaning or Swabbing of Old Wells Having Previously Produced Gas or Oil – By Contractor – No Drilling – and Drivers
• 3365 Welding or Cutting NOC and Drivers
• 3719 Oil Still Erection or Repair
• 3724 Machinery or Equipment Erection or Repair NOC and Drivers
• 3726 Boiler Installation or Repair – Steam
• 5020 Ceiling Installation – Suspended Acoustical Grid Type
• 5022 Masonry NOC
• 5037 Painting: Metal Structures – Over Two Stories in Height – and Drivers
• 5040 Iron or Steel: Erection – Frame Structures
• 5057 Iron or Steel: Erection NOC
• 5059 Iron or Steel: Erection – Frame Structures Not Over Two Stories in Height
• 5069 Iron or Steel: Erection – Construction of Dwellings Not Over Two Stories in Height
• 5102 Door, Door Frame or Sash Erection – Metal or Metal Covered
• 5146 Furniture or Fixtures Installation – Portable – NOC
• 5160 Elevator Erection or Repair
• 5183 Plumbing NOC and Drivers
• 5188 Automatic Sprinkler Installation and Drivers
• 5190 Electrical Wiring – Within Buildings and Drivers
• 5213 Concrete Construction NOC
• 5215 Concrete Work – Incidental to the Construction of Private Residence
• 5221 Concrete or Cement Work – Floors, Driveways, Yards, and Sidewalks – and Drivers
• 5222 Concrete Construction in Connection with Bridges or Culverts
• 5223 Swimming Pool Construction – Not Iron or Steel – and Drivers
• 5348 Stone, Mosaic or Terrazzo or Ceramic Tile Work – Inside
• 5402 Hothouse Erection – All Operations
• 5403 Carpentry NOC
• 5437 Carpentry – Installation of Cabinet Work or Interior Trim
• 5443 Lathing and Drivers
• 5445 Wallboard Installation Within Buildings and Drivers
• 5462 Glazier – Away From Shop and Drivers
• 5472 Asbestos Contractor – Pipe and Boiler Work Exclusively and Drivers
• 5473 Asbestos Contractor – NOC and Drivers
• 5474 Painting or Paperhanging NOC and Shop Operations, Drivers
• 5478 Carpet, Linoleum, Vinyl, Asphalt, or Rubber Floor Tile Installation
• 5479 Insulation Work NOC and Drivers
• 5480 Plastering NOC and Drivers
• 5491 Paperhanging and Drivers
• 5506 Street or Road Construction: Paving or Repaving and Drivers
• 5507 Street or Road Construction: Subsurface Work and Drivers
• 5508 Street or Road Construction: Rock Excavation and Drivers
• 5509 Street or Road Maintenance: County or State Department – and Drivers
• 5536 Heating and Air Conditioning Duct Work – Shop and Outside – and Drivers
• 5538 Sheet Metal Work – Shop and Outside – NOC and Drivers
• 5551 Roofing – All Kinds and Yard Employees, Drivers
• 5606 Contractor – Executive Supervisor or Construction Superintendent
• 5610 Cleaner – Debris Removal
• 5613 Cleaner – Debris Removal – Temporary Labor Service
• 5645 Carpentry – Detached One or Two Family Dwellings
• 5651 Carpentry – Dwellings – Three Stories or Less
• 5703 Building Raising or Moving and Drivers
• 5705 Salvage Operation – No Wrecking or Any Structural Operations
• 6003 Pile Driving
• 6005 Jetty or Breakwater Construction – All Operations to Completion and Drivers
• 6017 Dam or Lock Construction: Concrete Work – All Operations
• 6018 Dam or Lock Construction: Earth Moving or Placing – All Operations
• 6045 Levee Construction – All Operations to Completion and Drivers
• 6204 Drilling NOC and Drivers
• 6206 Oil or Gas Well: Cementing and Drivers
• 6213 Oil or Gas Well: Specialty Tool Operation NOC – By Contractor – All Employees and Drivers
• 6214 Oil or Gas Well: Perforating of Casing – All Employees and Drivers
• 6216 Oil or Gas Lease Work NOC – By Contractor and Drivers
• 6217 Excavation and Drivers
• 6229 Irrigation or Draining System Construction and Drivers
• 6233 Oil or Gas Pipeline Construction and Drivers
• 6235 Oil or Gas Well: Drilling or Redrilling and Drivers
• 6236 Oil or Gas Well: Installation or Recovery of Casing and Drivers
• 6237 Oil or Gas Well: Instrument Logging or Survey Work and Drivers
• 6251 Tunneling – Not Pneumatic – All Operations
• 6252 Shaft Sinking – All Operations
• 6260 Tunneling – Pneumatic – All Operations
• 6306 Sewer Construction – All Operations and Drivers
• 6319 Gas Main or Connection Construction and Drivers
• 6325 Conduit Construction – For Cable or Wires – and Drivers
• 6400 Fence Erection – Metal
• 7538 Electric Light or Power Line Construction and Drivers
• 7601 Telephone, Telegraph or Fire Alarm Construction and Drivers
• 7605 Burglar Alarm Installation or Repair and Drivers
• 7611 Telephone or Cable TV Line Installation – Contractors, Underground and Drivers
• 7612 Telephone or Cable TV Line Installation – Contractors, Overhead, and Drivers
• 7613 Telephone or Cable TV Line Installation – Contractors, Service Lines and Connections and Drivers
• 7855 Railroad Construction: Laying or Relaying of Tracks or Maintenance of Way by Contractor – No Work on Elevated Railroads – and Drivers
• 8227 Construction or Erection – Permanent Yard
• 9534 Mobile Crane and Hoisting Service Contractors – NOC – All Operations – Including Yard Employees and Drivers
• 9554 Sign Installation, Maintenance, Repair, Removal, or Replacement NOC & Drivers

Question: When did Florida first pass the workers’ compensation law?

Florida moved slower than other states in enacting a workers’ compensation law primarily because Florida had a smaller work force, virtually no manufacturing, and no major problems until the “Great Depression” of the 1930’s. During the depression, Florida started an aggressive campaign to attract business to the warmer, more economical climate. A “workmen’s” compensation law was necessary to meet the demands of the increased employment in the state and also helped to attract other businesses to move their operations to Florida. Prospective employers knew that they would be open to lawsuits from workers injured on the job and desired the “great trade-off” available with workers’ compensation insurance. Lawsuits were also on the rise and workers demanded protection. Governor David Sholtz recognized the necessity for this legislation and this new law was signed May 23,1935 as House Bill 29. Click here for more information on the history of workers’ compensation insurance in Florida.

Question: What are the rates for the FWCJUA?

The FWCJUA, Florida Workers Compensation Joint Underwriting Association, is intended to be the last resort for businesses who are unable to secure workers’ compensation insurance in the voluntary marketplace. The rates for the FWCJUA are also much higher than those in the voluntary market. The standard Florida workers compensation classification and rating rules apply to FWCJUA policies with the exception that no premium discount or deductible credits will be applied. There is also a flat fee of $475 applicable to all new and renewal FWCJUA policies.

The FWCJUA has three different rating tiers, each with different surcharge amounts. In order to properly calculate the total estimated annual premium, you must determine the tier for which the Employer is eligible. All Tier rating premiums are surcharged above voluntary compariable premium and as of January 1st, 2008, the surcharges are:

• Tier1 - 83%
• Tier2 - 83%
• Tier3 - 134%

Tier 3 is an assessable rating tier. Employers qualifying for Tier 3 shall receive an assessable policy and shall be required to contribute on a pro-rata-earned-premium basis the money necessary to meet any assessment levied to cover any deficit attributable to Tier 3. Participants in Tier 3 may be assessed more than once, and any asessment may be made either while the Tier 3 policy is in effect or at any time after the termination, expiration or cancellation of the Tier 3 policy. Assessments levied against Tier 3 participants shall cover only the deficits attributable to Tier 3.

Question: What is the FWCJUA?

FWCJUA stands for the Florida Workers Compensation Joint Underwriters Association. Because workers’ compensation in Florida is mandatory for most businesses, there must be place for businesses to secure coverage when they are unable to find it in the marketplace.

Before there was an FWCJUA, the Florida Workers Compensation Insurance Plan (FWCIP) was the market of last resort. The Florida Department of Insurance had complete control over the operation of the FWCIP including operating rules and rates, and merely delegated day-to-day responsibilities to the NCCI (National Council on Compensation Insurance), as Plan Administrator. The FWCIP was not a self-funding plan, but rather was funded by insurance carriers licensed to write workers’ compensation insurance in Florida. In the mid-1980’s, premiums became insufficient to cover losses in the FWCIP and carrier assessments were levied. Because carriers funded the FWCIP on the basis of their voluntary market share, the result of more sizable FWCIP operating losses caused the voluntary market to shrink and forced businesses to find other alternatives to workers’ compensation insurance, such as self-insured funds. By the early 1990’s, 35% of Florida’s workers’ compensation market was in the FWCIP generating in excess of $200 million in underwriting losses. This was a large problem.

It led to Florida’s workers’ compensation reform in 1993, and the FWCJUA was established and designed as a self-funding plan to provide workers compensation and employer’s liability insurance to employers who are required by law to maintain such insurance and who are in good faith entitled to, but who are unable to purchase insurance through the voluntary market. As a result, employers insured within the FWCJUA pay premiums in excess of those paid in the voluntary market. From inception in 1994 through July 2003, there were three rating plans established for various classifications of risks and all employers were assigned to one of these three rating subplans either “A”, “B”, or “C” with Subplan “C” insureds receiving an assessable policy. In 2004, the Legislature created a three tier rating plan that based the insured’s premium on their experience and while capping the rates, the surcharges over manual rates were increased and provisions were made to ensure actuarially sound rates by January 2007. Any FWCJUA deficits will be funded through a Workers’ Compensation Trust Fund contingency reserve or through a below-the line assessment levied to all employers purchasing workers compensation insurance in Florida. The goal of the FWCJUA is to depopulate the Florida workers’ compensation residual market and invigorate the competitive or voluntary market.

Here are some important facts about the FWCJUA:

• The FWCJUA was designed to be self-supporting.
• Standard classification and rating rules apply.
• No premium discount or deductible credits apply to FWCJUA policies.
• A flat fee of $475 is applicable to all new and renewal FWCJUA policies.
• The FWCJUA has three different rating tiers, each with different surcharge amounts.  In order to properly calculate the total estimated annual premium, you must determine the tier for which the Employer is eligible.

Question: What is the ‘great trade-off’ in workers compensation insurance?

In workers’ compensation insurance, the ‘great trade-off’ protects employers because the injured employee agrees to give up his/her right to sue the employer if they receive benefits for the work-related injury. An employer’s ‘exclusive liability’ to an employee who suffers an accidental injury or death arising out of work performed in the course and scope of employment is to secure the payment of WC benefits, as set forth in the law. By purchasing a WC insurance policy or otherwise securing the payment of benefits in a manner permitted by the law, an employer is immune from any other liability to an injured employee or his family. From the employee’s viewpoint, recovery of WC benefits is the ‘exclusive remedy’ for his injuries.

The immunity of employers is specified in 440.11(1) of the Florida Statutes, which states that the liability of an employer to secure the payment of WC “shall be exclusive and in place of all other liability to any third-party tortfeasor and to the employee, the legal representative thereof, husband or wife, parents, dependents, next of kin, or anyone else entitled to recover damages from such employer” due to the injury or death of an employee. Immunity applies even if an employer’s negligence causes an injury.

The Florida Supreme Court interpreted this section in Seaboard Coast Line Railroad Company v. Smith.

“An employer under this Act is not liable in tort to employees by virtue of the express language of the Act. Such immunity is the heart and soul of this legislation which has, over the years been of highly significant social and economic benefit to the working man, the employer and the State. And whether the injury to the employee is caused by ‘gross negligence,’ ‘wanton negligence,’ ’simple negligence’ passive or active, or no negligence at all of the employer is of no consequence. There is no semblance of suggestion in these statutes that the Legislature intended to make any distinction in degrees of negligence so far as the employer’s immunity is concerned and we see no reason or logic in any distinction.”

Note, however, that the ’great trade-off’ does not protect the employer from every situation. In Byerley and Byerley v. Citrus Publishing Co., Inc., the First DCA held that an employer can’t successfully deny WC benefits by saying the injured worker was outside the scope and course of employment and then, when sued in tort for negligence, contend that workers’ compensation is the exclusive remedy. Click here to read more information on workers’ compensation insurance.

Question: What is a waiver of subrogation?

Subrogation is your right (and therefore your insurance carrier’s right) to recover the cost of a paid claim if the loss was caused by that third party. Many workers’ compensation claims occur due to negligence of somebody outside of your business and your insurance carrier could choose to sue that person or entity to recover the cost of the loss. The claim cost will also be adjusted on your experience mod calculations if money is recovered from the third party.

Some contractual agreements, mostly in the construction industry, require you to waive your right of subrogation (and therefore your insurance carrier’s rights) against them in the event of a claim. Before you can waive these rights, you need to complete a form that lets your insurance company know what is happening and thay may request a copy of the contract as well. The insurance companies generally will have an extra charge associated with this endorsement to your workers compensation policy. Once approved, you can then send an updated copy of your certificate of insurance to the party requesting the waiver of subrogation through the contractual agreement. Some insurance carriers will not approve waivers of subrogation and it all depends on the details of the contract and job for which the rights are being waived. Before you decide to waive your rights of subrogation for any contract, you should understand what is at stake.

Often when an employee is injured at work there is some person or party, other than the employer or co-employee, who bears some responsibility for causing the employee’s injury. When someone from outside the employment relationship causes all or part of an employee’s work-related accident or injury, then the claim is able to be subrogated. For workers’ compensation purposes, that individual or entity is known as a third party. The presence of a third party does not excuse the employer from its obligation to pay workers’ compensation benefits if the injury occurred in the course and scope of the employee’s work related duties.

The presence of a third party does, however, change who bears ultimate responsibility for compensating the employee for his or her injury-related losses. Subrogation allows an employer paying workers’ compensation benefits to either step into the employee’s place or participate with the employee in any such lawsuit that the employee might have against the third party. The employer is allowed to participate in an attempt to get back from the third party the workers’ compensation benefits it paid to the employee. Such repayment is allowed because it is the third party who really caused the employee to suffer the loss. The employer’s recovery will be limited to the benefits it has already paid and, in some instances, to benefits it might have to pay. Any portion of an award in a lawsuit that includes amounts for losses paid by workers’ compensation is refunded to the employer or their insurance carrier asserting the subrogation claim.

Usually, employers purchase workers’ compensation insurance to cover their obligations under the workers’ compensation laws and generally the employer’s workers’ compensation insurer, who actually pays the employee benefits, asserts the subrogation claim on the employer’s behalf. Employers should co-operate with their insurer’s efforts to bring a subrogation claim as it directly affects their experience mod and therefore their future insurance premiums. Waiving your right and your insurance carrier’s right to subrogate a claim can have a tremendous effect on your future cost of insurance if a claim occurs that could have had its costs recovered through subrogation.

Question: What is the Jones Act?

The Jones Act is a federal law designed to offer remedy and legal protection to sailors, seamen, and other maritime employees who are not covered by state workers compensation and employers liability laws. The Merchant Marine Act of 1920, also known as the Jones Act, is compensation legislation intended to allow sailors with injuries to recover money to help cover the costs of medical care and health recovery. 

State laws do not apply to employees on wharves, docks, or navigable waters whether they be interstate or international. It allows maritime employees the ability to sue their employers or shipowners should they be injured through the negligence of that employer or shipowner.

The Merchant Marine Act of 1920, also known as the Jones Act, is compensation legislation intended to allow sailors with injuries to recover money to help cover the costs of medical care and health recovery. However, it is not a workers compensation law for seamen and maritime workers. In some cases it is more and in others it is less. Additional benefits apply if the injury is caused by negligence of the employer or by the work environment on the vessel. Injured sailors are entitled to many of the same things covered under other workers compensation laws. Some benefits to which they are entitled are payments when they are disabled or otherwise incapable of working, payment for the costs of medical care and ongoing rehabilitation and transportation costs. In cases where the injury was caused by a negligent working environment, the injured sailor is entitled to additional damages for Pain and Suffering.

The Act covers injured seamen but not longshore and harbor workers. These workers have other federal statutes, such as The United States Longshore and Harbor Workers’ Compensation Act (USL&HWCA), to respond to their injuries, just as laws are in place to protect workers in general. All workers compensation legislation is intended to provide a framework for protecting workers when they become injured. It details the circumstances under which employers, the ship owners in the case of the Jones Act, are responsible for the costs of medical care for an injured sailor, including ongoing healthcare for repairing and rehabilitating that injury.

While the intent of the law is to assist the worker, the original idea behind all workers compensation laws, including the Jones Act, was to reduce the cost of litigation. The overall goal is to provide a fair process that assures the sailor the timely medical benefits he or she is entitled to, without having the financial burden of hiring an attorney, forcing the employer to go to court and having a judge review and assess damages. However, the law is complex and situations may develop where it is in the best interest of all parties to seek the advice of qualified legal counsel.

The Merchant Marine Act of 1920 (Jones Act) is federal legislation (The Jones Act 46 U.S.C.S.App.688 [2002]) and includes admiralty and maritime law. It also applies to workers working on offshore oil rigs. A seaman is defined as an individual engaged or employed in any capacity aboard a vessel, including the master and members of the crew. It does not include scientists on board ships, sailing instructors or sailing school students. Coverage is provided for these exposures by attaching the appropriate coverage endorsements to the standard Workers Compensation and Employers Liability Insurance Policy.

Question: What is the Longshore and Harbors Workers Compensation Coverage?

The Longshore and Harbors Workers Compensation Coverage is provided by an endorsement to the workers compensation policy. It covers workers or maritime employees in positions such as longshoremen, harbor workers, shipbuilders, ship-breakers, ship repairers or other employees engaged in loading, unloading, repairing or building vessels. It also covers employees who work on navigable waters, adjoining piers, wharves, dry docks, terminals, building ways and marine railways. It does not cover masters, captains, or crews of vessels unless further endorsed to voluntarily cover those positions. Associations that operate on the water, especially on navigable waters, such as rivers and oceans, may be required to purchase this coverage.

The United States Longshore And Harbor Workers’ Compensation Act (USL&HWCA) was enacted by legislation in 1927. It is a federal workers compensation law that applies to maritime employees who work on or over navigable waters in or adjacent to the United States. However, it does not apply to sailors, seamen, masters and crews of any ship, vessel or watercraft. The workers subject to this Act are usually not eligible for state workers compensation benefits because they work on or over navigable waters. They are also not eligible for coverage under the Jones Act or the Merchant Marine Act because they are not seamen. As a result, the USL&HWCA was needed to fill the coverage gap for this class of workers.

Question: As the owner of the business, can I exclude myself from my workers’ compensation policy?

Yes, an individual that is an officer of a corporation can elect to be exempt from workers’ compensation coverage. This will exclude the officer from recovering workers’ compensation benefits, but by doing so, the individual may remove their payroll from the total payroll that is used to compute the premium. Many employers choose to be exempt on their workers’ compensation policies to save money on their premium. Our website has more information on the requirements and the form you need to download and file with the State of Florida. Click here for more information on Officer Exemption from Florida Workers Compensation Insurance.