In 2019 Florida's workers' compensation premiums were determined by a formula that blends the state's base rate, industry classification, and each employer's experience rating. The base rate for 2019 was set at $1.20 per $100 of payroll, with adjustments for specific job classifications and a statewide experience modifier ranging from 0.70 to 1.30. Below we break down how the rates are calculated, the most common classification codes, and the practical steps employers should take to verify their premiums.
- How Florida Calculates Workers' Compensation Premiums
- 2019 Base Rate and Classification Multipliers
- Experience Rating: What It Means for Employers
- Example Calculation
- Key Changes and Considerations for 2019
- Steps Employers Should Take to Verify Their 2019 Premiums
- Resources and Where to Find Official Data
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How Florida Calculates Workers' Compensation Premiums
Florida uses a three‑part formula:
- Base Rate: Set annually by the Florida Office of Insurance Regulation (OIR).
- Classification Factor: Each occupation is assigned a class code with a specific multiplier.
- Experience Rating: Adjusts the premium up or down based on an employer's loss history.
The resulting premium is expressed as a dollar amount per $100 of payroll.
2019 Base Rate and Classification Multipliers
The OIR announced a base rate of $1.20 per $100 of payroll for 2019. Below is a snapshot of the most common classification codes and their multipliers.
| Classification Code | Industry Example | Multiplier |
|---|---|---|
| 8810 | Construction – General | 1.00 |
| 8742 | Retail – Clothing Stores | 0.85 |
| 8812 | Construction – Roofing | 1.30 |
| 8740 | Retail – Food Stores | 0.95 |
| 8910 | Manufacturing – Food Processing | 1.10 |
Experience Rating: What It Means for Employers
Florida's experience rating system rewards safety. An employer's rating factor is calculated from the ratio of actual losses to expected losses over the prior three policy years. The factor ranges from 0.70 (excellent safety record) to 1.30 (poor safety record). The formula is:
Premium = Base Rate × Classification Multiplier × Experience Rating × Payroll/100
Example Calculation
An employer with $500,000 payroll in the 8810 construction class and an experience rating of 0.90 would pay:
- Base premium: $1.20 × 500,000/100 = $6,000
- Adjusted for classification: $6,000 × 1.00 = $6,000
- Experience adjustment: $6,000 × 0.90 = $5,400
Resulting 2019 premium: $5,400.
Key Changes and Considerations for 2019
- Rate Freeze: The 2019 base rate was unchanged from 2018, reflecting a temporary freeze by the OIR.
- Medical Fee Schedule Update: The state updated its medical fee schedule, affecting claim costs but not the premium calculation directly.
- Minimum Premium: Employers with very low payroll still faced a minimum premium of $500 per policy.
Steps Employers Should Take to Verify Their 2019 Premiums
Resources and Where to Find Official Data
The Florida Office of Insurance Regulation publishes the annual rate notice, classification tables, and experience rating guidelines on its website (www.floir.com). Insurers also provide annual statements that break down each component of the premium.