How would you like to get your client thrown in jail?
Now that Hurricane Charley has had his way with the State of Florida, a natural phenomenon will one again occur. Many subcontractors from up and down the East Coast will be flocking to the sunshine state to participate in the clean up and rebuild. If you have a contractor, you believe, in anyway will want to do this read on! A change in the Workers Compensation law in Florida, Senate Bill 50A, that was passed in October of 2003 makes it a second-degree felony for a contractor to do work in Florida without first obtaining Workers Compensation coverage using Florida rates, rules and manual.
I feel very comfortable and confident in telling any client of mine, located here in North Carolina, that their employees who are hired and work in North Carolina, are covered any where in the world for North Carolina Workers Compensation benefits. If they go and work temporarily in another state for a particular job or project and the employee is hurt; they have North Carolina benefits. No problem with that answer, right? Well the State of Florida says they could care less what North Carolina says when that contractor steps foot in Florida to work.
You then say you have added Florida as one of those states listed in 3C other states sections of the policy, right? A carrier can add a state to 3C even if they are not admitted or licensed in that state. The policy says they, the carrier, will reimburse the employer if they are not allowed to provide direct coverage to the employee. The State of Florida interprets Florida rates, rules and manual as the carrier being an admitted and licensed carrier in Florida. 3C will not help you at all if the current carrier is not an admitted carrier in Florida.
It appears this law is a result of major problems with injured construction workers from out of state contractors and the coverage was not in place or the claim went south. This has been such a problem that along with this law, Florida had funded seventy additional job site inspectors to do insurance coverage searches for job sites. They have the power and authority to issue a stop work order for the project should the proper coverage not be in place. Any stop work order is considered insurance fraud!
You also need to be aware that in North Carolina, sole proprietors, and partners are excluded under the Workers Compensation Act, but can elect to be covered. Corporate officers are covered, but can elect to exclude themselves from coverage. In Florida, a maximum of three officers can be excluded in construction and they must present a stock certificate indicating at least ten percent ownership in the company to be excluded. Sole proprietors and partners must be covered in construction.
The situation now in Florida is a classic case of what we do not know can hurt us. The extra territorial provisions of states close to us can put our clients and us as agents at risk. I am aware of an out of state contractor who went to Florida to do work with work comp and relied on 3C to protect him. He was arrested for second-degree felony of not having Florida Workers Compensation. I hear he is now very interested in suing his agent as a result of the arrest. I wonder if the agent even knew his client was going to Florida? I wonder in the agent have even heard of Senate Bill50A in Florida? I wonder?
Important Insurance Info
Member #: 17008
Registered: 1996-2001
Posted:
76
Name:
SKIP
Company:
Mid Atlantic Cable Solutions
Occupation:
Full service company
Location:
Swansboro NC
Personal:
mid 60s
Experience:
~38 years
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