A proposed 17.1% rate hike for workers’ compensation insurance in Florida has both the state’s business community and employee advocates concerned, reported
Orlando Sentinel.
The rate increase was endorsed Friday by the National Council on Compensation Insurance (NCCI)—an insurance industry advocate based in Boca Raton.
Florida’s Office of Insurance Regulation is reviewing the proposal. If approved, the state would raise rates on August 1.
"Seventeen percent is absolutely exaggerated unless we are trying to insulate insurers from their own bad behavior," commented Geoffrey Bichler, an attorney in Maitland who represents injured police officers and firefighters.
"It's basically a money grab by insurance companies who are trying to scare employers into supporting a change in the state's laws," remarked John Morgan, a plaintiff’s attorney at Morgan & Morgan.
The NCCI argued that most of the proposed rate hike is largely due to the recent ruling by the Florida Supreme Court that said a cap on fees for plaintiffs' attorneys is unconstitutional. The ruling was made during a case filed by injured door company employee Marvin Castellanos, where Castellanos’ legal team was capped at a $1.25 an hour fee.
State legislature is set to also assess how a 2009 statute capped plaintiff attorney fees.
The Florida Chamber asserted that the proposed rate increase would damage business in the region. It also said that its task force on workers’ comp is "preparing a legislative remedy."
The NCCI stated in its announcement that in its first year, the Supreme Court ruling will cause a 15% overall increase in Florida’s workers’ comp system. The 17.1% increase the group proposed considered other factors.
Orlando workers' compensation attorney Timothy Dunbrack assured that the state might not even approve the full 17.1% increase.
"The economy is just getting back up to speed, and this would really saddle Central Florida companies with higher costs," Dunbrack explained. "Florida would have the highest rate of workers' comp insurance in the Southeast. So that would make things difficult to attract companies to come here."
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