Consequences of cutting workers’ compensation insurance
The economy begins to reactivate. Many are the companies that resume their business after several months without activity due to the pandemic. The financial status of the majority is critical, so the owners go to great lengths to cut costs. Some, after cutting back here and there, dare to eliminate workers’ compensation insurance. Above all, “in those safe companies”, “where accidents never happen”.
However, if a business owner is found without workers’ compensation insurance, they could face very costly penalties.
And although it may seem difficult, it is not impossible to detect those who stop paying for said insurance. The Florida Department of Financial Services regularly inspects the financial status of companies and one of its goals is to find companies that have defaulted on workers’ compensation insurance.
Companies that are without this insurance will be forced to close immediately until they comply with that requirement established by Florida law. Furthermore, in order to restart your activity, you will have to pay a fine that is usually equal to twice the amount that the company would have paid in compensation insurance for two years.
We know that the situation is difficult for everyone. But be sure to meet your legal obligations. An unfortunate decision could lead to the ruin that you intend to avoid.