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Florida Workers' Comp Legal Fees on the Rise image

Florida Workers' Comp Legal Fees on the Rise

Buying workers’ compensation insurance is a lot like buying a new roof for your small business – it’s not as fun as shoe shopping (even though our agents do make it easy), but necessary. It helps address and protect your business from the unknown ("Will my employees, customers and equipment be safe if extreme weather comes through?"). Like purchasing a new roof, you want to make sure you and your employees are protected with workers’ compensation insurance. But, what if you’re a small business owner in Florida and your workers’ compensation insurance premiums skyrocket?

According to the Florida Office of Insurance Regulation, injured workers legal fees approached $186 million in 2016-2017, 36% higher than the previous year. With total compensation claims in Florida nearing $400 million, legal fees are at an all-time high.

Why are workers’ compensation legal fees so high in Florida? In 2016, the Florida Supreme Court ruled in Castellanos v. Next Door Company that restrictive fee caps violated injured workers’ due process rights and allowed judges to award fees outside the schedule depending on the circumstances. Marvin Castellanos, an employee of Next Door company, sued his employer after he was injured on the job, his attorney requested $350 per hour while the mandated sliding scale averaged $1.53 per hour according to the Insurance Journal. Since the state ruled fee caps are unconstitutional, Florida workers’ compensation attorneys aren’t as limited in their compensation schedule, which accounts for rising costs.

Now you must be asking, so how does this affect my small business? According to Daily Business Review, workers' compensation premiums went up 14.5 %, after the ruling in December of 2016, leaving small businesses worrying about where to find the extra funds to keep their coverage. Failing to pass workers’ comp reform in Florida over the summer of 2017, small businesses have rate increases on the horizon yet again. There is hope, however. Property Casualty 360 reports that David Altmaier, Florida’s Insurance Commissioner has recently proposed to lower workers’ comp insurance premiums by 9.8%, helping small business owners afford coverage again. We’ll loop you back in with the latest after legislation has gone through.

Keeping up with workers’ compensation is tricky, with ever-changing regulations, it can be hard to get the facts straight. You can count on us to help.


The opinions expressed herein by columnists are their own, not those of AmVenture Insurance Agency, Inc., its subsidiaries, or affiliates.