Whether you need workers’ compensation insurance depends on a few factors, including:
Your state: All states except North Dakota require businesses with employees to carry workers’ compensation insurance. So, if you have even one employee, you’ll most likely need this coverage.
Your industry: Some industries have higher risks of work-related injuries and illnesses than others. As a result, some states may require businesses in these industries to have workers’ compensation insurance even if they have no employees.
Your classification: Your workers’ compensation classification is based on the type of work your employees do. Some classifications have higher premiums than others.
Here’s a table that summarizes the requirements for workers’ compensation insurance in each state:
| State | Requirement |
|---|---|
| Alabama | Required for all businesses with 5 or more employees |
| Alaska | Required for all businesses with 1 or more employees |
| Arizona | Required for all businesses with 1 or more employees |
| Arkansas | Required for all businesses with 5 or more employees |
| California | Required for all businesses with 1 or more employees |
| Colorado | Required for all businesses with 1 or more employees |
| Connecticut | Required for all businesses with 1 or more employees |
| Delaware | Required for all businesses with 1 or more employees |
| Florida | Required for all businesses with 4 or more employees |
| Georgia | Required for all businesses with 5 or more employees |
| Hawaii | Required for all businesses with 1 or more employees |
| Idaho | Required for all businesses with 5 or more employees |
| Illinois | Required for all businesses with 1 or more employees |
| Indiana | Required for all businesses with 5 or more employees |
| Iowa | Required for all businesses with 5 or more employees |
| Kansas | Required for all businesses with 5 or more employees |
| Kentucky | Required for all businesses with 1 or more employees |
| Louisiana | Required for all businesses with 5 or more employees |
| Maine | Required for all businesses with 1 or more employees |
| Maryland | Required for all businesses with 1 or more employees |
| Massachusetts | Required for all businesses with 1 or more employees |
| Michigan | Required for all businesses with 1 or more employees |
| Minnesota | Required for all businesses with 1 or more employees |
| Mississippi | Required for all businesses with 5 or more employees |
| Missouri | Required for all businesses with 5 or more employees |
| Montana | Required for all businesses with 1 or more employees |
| Nebraska | Required for all businesses with 5 or more employees |
| Nevada | Required for all businesses with 1 or more employees |
| New Hampshire | Required for all businesses with 1 or more employees |
| New Jersey | Required for all businesses with 1 or more employees |
| New Mexico | Required for all businesses with 1 or more employees |
| New York | Required for all businesses with 1 or more employees |
| North Carolina | Required for all businesses with 5 or more employees |
| North Dakota | Not required |
| Ohio | Required for all businesses with 1 or more employees |
| Oklahoma | Required for all businesses with 5 or more employees |
| Oregon | Required for all businesses with 1 or more employees |
| Pennsylvania | Required for all businesses with 1 or more employees |
| Rhode Island | Required for all businesses with 1 or more employees |
| South Carolina | Required for all businesses with 4 or more employees |
| South Dakota | Required for all businesses with 5 or more employees |
| Tennessee | Required for all businesses with 5 or more employees |
| Texas | Required for all businesses with 1 or more employees |
| Utah | Required for all businesses with 1 or more employees |
| Vermont | Required for all businesses with 1 or more employees |
| Virginia | Required for all businesses with 5 or more employees |
| Washington | Required for all businesses with 1 or more employees |
| West Virginia | Required for all businesses with 1 or more employees |
| Wisconsin | Required for all businesses with 3 or more employees |
| Wyoming | Required for all businesses with 1 or more employees |
Even if you’re not legally required to have workers’ compensation insurance, it’s still a good idea to consider getting it. Workers’ compensation insurance can help protect your business from financial losses if an employee is injured or becomes ill on the job. It can also help protect your employee from having to pay for their own medical expenses and lost wages.
