Skip to Content

Frequently Asked Questions


FWCIGA is part of a non-profit, state-based, statutorily-created system that pays certain outstanding claims of insolvent workers’ compensation insurance companies and self-insurance funds.  By paying these claims, guaranty associations protect policyholders and claimants.

Guaranty associations are active in every state, the District of Columbia, Puerto Rico and the Virgin Islands.  State laws require that licensed property and casualty insurance companies belong to the guaranty associations in every state where they are licensed to do business.

A guaranty association system also exists in Florida for the life, health and annuity insurance industry and individual self insured’s; but they operate independently from the property and casualty system.  This information concerns only the workers' compensation insurance guaranty associations.


Guaranty associations ease the burden on policyholders and claimants of the insolvent insurer by immediately stepping in to assume responsibility for most policy claims following liquidation. The coverage guaranty associations provide is fixed by the policy or state law; they do not offer a “replacement policy.”

By virtue of the authority given to the guaranty associations by state law, they are able to provide two important benefits:  prompt payment of covered claims and payment of the full value of covered claims up to the limits set by the policy or state law.


FWCIGA is administered by a board that is elected by the guaranty association members (that is, all companies writing licensed business in that state), the Florida Consumer Advocate, a Chief Financial Officer appointee and a Governor appointee.  There is oversight authority by the Florida Department of Financial Services, who reviews the association’s plan of operation, and may also audit a guaranty association.  In Florida the appointment to the guaranty association board is subject to the approval of the Chief Financial Officer.

While many of the associations are based on a model set forth by the National Association of Insurance Commissioners (NAIC), there are differences in statutes that govern the associations and their operation from state to state, including the amount of coverage provided by the association.

The potential failure of insurance companies, like the potential failure of all businesses, is an unfortunate, but inevitable, part of doing business in a free-market system.  Since inception of the property and casualty guaranty association system, there have been about 600 insolvencies.  In all, the system has paid out about $24.2 billion.

FWCIGA is partially funded by assets of insolvent insurers.  Receivers marshal estate assets and reimburse FWCIGA for paid claims and administrative costs related to the FWCIGA’s claim paying activities.

The other source of funding is member company assessments.  FWCIGA’s assessments are capped at 2% for insurance companies and self-insurance funds net direct premium written in Florida.  


FWCIGA’s assessments are computed and billed based on the immediate needs of the guaranty association that has claims it needs to pay.  Claim files come in from the insolvent insurance company; the adjusters review them, and set appropriate reserves on those files. (Reserves are the projected ultimate liability under terms of a given policy.)

In Florida the assessment cap is 2% of net direct-written premium.  FWCIGA cannot assess an insurance company or self-insurance fund more than the statutorily set cap on assessments.


Liquidation is similar to bankruptcy. When a company is liquidated, the Liquidator (also referred to as the Receiver), collects the assets of the company and verifies the liabilities such as claim payments and bills. The Liquidator then develops a plan to distribute the company’s assets according to the law and submits the plan to the Court for approval.

In most cases, an estate will not yield sufficient money to pay claims in full; and most are not able to pay claims in a timely manner.  For this reason, FWCIGA and other state guaranty associations step in (depending on the number of states in which the failed company wrote business) to cover certain claims.  The estate’s creditors not covered by the guaranty associations usually receive only partial payment on their claims.


Most liquidation orders cancel all policies within a certain time period after liquidation, typically 30 days.

You will need to obtain coverage with another insurance company. However, we do not recommend any particular company. You may contact any licensed insurance agent to get the names of other insurers.



A covered claim is defined in the FWCIGA statute (F.S.631.904) as:… “Covered claim” means an unpaid claim, including a claim for return of unearned premiums, which arises out of, and is within the coverage of, and not in excess of, the applicable limits of an insurance policy to which this part applies, which policy was issued by an insurer and which claim is made on behalf of a claimant or insured who was a resident of this state at the time of the injury."

No.  FWCIGA is designed as a safety net to pay certain claims arising out of policies issued by licensed insurance companies and self-insurance funds.  FWCIGA does not pay non-policy claims or claims of individual self-insured’s, or other entities that are exempt from participation in the guaranty association system.

FWCIGA coverage is limited to licensed insurers and self-insurance funds (the members of the guaranty associations that, in turn, pay insolvency-related assessments.)  When a licensed insurance company or self-insurance fund becomes insolvent, the FWCIGA pays eligible claims; but a company does not have guaranty association coverage if it is writing non-admitted or unlicensed products, such as surplus lines or is a self-insurer covered in the non-admitted market.

These limits on guaranty association coverage are necessary to balance the need to provide a safety net to those who would be most harmed by the insolvency of their insurance company and keep the burden of providing the safety net at an acceptable level.


Yes.  FWCIGA limits the amount they pay to the amount of coverage provided by the policy.  However, FWCIGA does not limit benefits paid to injured workers and pays 100 percent of the statutorily defined workers’ compensation benefits. Employer liability claims are limited to the lesser of $300,000 or policy limits. For unearned premium claims, FWCIGA’s obligation is limited to $50,000 and covers only policies in force on the date of liquidation.


It varies, but claim payments usually begin as soon as possible once a company is ordered liquidated.  FWCIGA, coordinating with the receivers of the liquidating companies, works hard to avoid any interruption in periodic benefits that are being paid to claimants, such as workers’ compensation loss-of-wages payments.

The processing and payment of pending covered claims will be made by FWCIGA.

You may contact the Florida Workers’ Compensation Insurance Guaranty Association (FWCIGA) at;

PO Box 15159
Tallahassee, Florida 32317
(866) 909-9200 Toll Free
(850) 523-1887 FAX


Unearned Premium

FWCIGA will pay unearned premium claims after the Receiver completes its processing of the policy records and sends the unearned premium record to FWCIGA.  This may take several weeks or several months depending on the condition of the data at the insolvent insurance company.