On April 28, 2016, the Florida Supreme Court issued an opinion in the case of Castellanos vs. Next Door Company, et al., No. SC13-2082 (“Castellanos”) declaring Section 440.34, Florida Statutes, unconstitutional.  The anticipated impact of the decision is the elimination of the statutory caps on claimant attorney fees and a return to hourly fees.

As a result of this case, the National Council on Compensation Insurance (NCCI) will file a mid-course rate increase with Florida’s Office of Insurance Regulation.  The filing proposes a 15% rate increase due to Castellanos and a 1.8% increase due to statutory changes in the 2016 legislative session, for a total proposed increase of 17.1%.  The monetary impact of this increase is estimated to be $623 Million  This rate will impact all policies as of August 1.  The full impact of this case cannot yet be calculated, and it is possible we may continue to see further increases because of the conditions created by the Castellanos decision.  The Office of Insurance Regulation will consider this rate filing in a hearing to be held later this summer.  We will keep you posted on the date of the hearing.

We are very aware of the impact this may have on your business, and we are evaluating potential solutions that we may propose to the legislature to address this significant and burdensome increase.   As the Office of Insurance Regulation considers this rate increase, they need to know the impact to employers.  We welcome your feedback and your story regarding how this rate increase will affect you.  Please feel free to call us with questions or concerns.