Worker’s Compensation is a highly recommended, but often forgotten coverage for associations of all sizes. For a relatively low premium (just over $700), associations can protect themselves from 3 types of “employees” injuries.
1: Uninsured Contractors
Associations and their property managers should verify that all contractors who perform work on the association’s property are licensed and insured. Even though requesting certificates should be required before hiring a contractor, there could be times that the contractor’s policy lapses and the association or property manager is not notified. If a contractor were to be injured, a Worker’s Compensation policy could pay for the contractor’s injuries. Please note the policy is supposed to be a safety net. It’s not wise, nor is it the intention of the policy to provide coverage for all workers or vendors who do not have Workers’ Compensation coverage.
2: Contractors Who Have Waived Workers’ Compensation Coverage
Smaller construction firms often waive Workers’ Compensation for corporate officers and members of a LLC. This is allowed by the Florida Statutes, and was implemented to help smaller construction firms who have difficulty affording Workers’ Compensation. These individuals must file an exemption with the Florida Department of Financial Services online. If an injury were to occur to that exempt contractor while working for the association, in essence no coverage should apply. However, some courts have held the association partly responsible. A Workers’ Compensation would assist in paying for a contractor’s medical bill if this were to occur.
3: Association Volunteers
A Workers’ Compensation policy endorsed with a Voluntary Compensation endorsement can protect any volunteer from injury they sustain while working at the association. This is extremely beneficial to volunteers who donate their time to help with the association. An example may be a volunteer who gets injured while decorating the clubhouse for the annual Christmas party.
It is important to note that these policies are auditable. In the event of a claim, or upon review, a carrier can audit the insured and charge the appropriate charge for all contractors who were hired without a certificate on file.
If you have any questions about Workers’ Comp coverage for your association please contact Brian T. Ford, CPCU at BFord@InsuranceResourcesLLC.com or 727-345-0242.