New NCCI FL Basic Manual rule effective 3-1-2023 pertaining to subcontractors
We received the attached from our friends at Normandy Insurance:
NCCI suggested, and the Florida DOI accepted, a new subcontractor rule effective 3.1.23 for Florida. Of particular importance is the caveat pertaining to subcontractors that utilize the services of a PEO. Specifically, regarding certificates of insurance (Under Item 04-FL-2022-Revisions to Basic Manual Rules for Subcontractors in Florida Exhibit 2H 1B 1), the new rule states that if a subcontractor is a client of an Employee Leasing Company, they must supply a list of the employees leased to the subcontractor as of the date work was commenced for each project. Said differently, every new certificate request must show employees in place at that exact time of certificate issuance. Again, this rule is effective for all new and renewal policies with an effective date of 3.1.23.
Lots to digest here but a few 'quick hit' items that come to mind:
Technically, any company (or carrier?) that wants to dispute this ruling, "must submit a rule filing to the OIR to include information as required by 627.211, Florida Statutues, and Rule 69O-189.016, Florida Administrative Code; prior approval by the OIR is required." We hope carriers do such as this will be an administrative nightmare for all parties.
To comply: Immediately, the PEO and broker need to keep an ongoing ("real time") employee census for all client companies to be able to certificate off of. This being a result of a certificate of insurance for subs needing to show a list of employees it is covering.
What about ASO? This rule does not contemplate a PEO-Client Company relationship where coemployment for workers' compensation is not in play.
Other questions to ponder: What happens when the GC doesn't accept the employee census data from the PEO? Will carriers now have to supply MPPs for all contractor exposures? At what point does Florida become an MCP state, or will this even matter?
We are certain this will be discussed in more detail next week at FAPEO. See you there!"
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