Rosalie Murphy is a small-business writer at NerdWallet. Since 2021, she has covered business insurance, banking, credit cards and e-commerce software, and her reporting has been featured by The Associated Press, MarketWatch, Entrepreneur and many other publications. Rosalie studied journalism at the University of Southern California and holds a graduate certificate in Quantitative Business Management from Kent State University, where she's now pursuing an MBA. She is based in Chicago.
Assigning Editor Ryan Lane
Assigning Editor | Small business, student loans
Ryan Lane is an editor on NerdWallet’s small-business team. He joined NerdWallet in 2019 as a student loans writer, serving as an authority on that topic after spending more than a decade at student loan guarantor American Student Assistance. In that role, Ryan co-authored the Student Loan Ranger blog in partnership with U.S. News & World Report, as well as wrote and edited content about education financing and financial literacy for multiple online properties, e-courses and more. Ryan also previously oversaw the production of life science journals as a managing editor for publisher Cell Press. Ryan is located in Rochester, New York.
Fact Checked
Many, or all, of the products featured on this page are from our advertising partners who compensate us when you take certain actions on our website or click to take an action on their website. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
If your business has employees, most states require you to carry workers’ compensation insurance . But whom you have to cover and how you buy this insurance will depend on where you work.
Here are the workers' compensation insurance requirements by state, plus information on different types of coverage and common exceptions states may offer.
Options for getting workers’ compensation insurance will depend on your state.
If you do business in North Dakota, Ohio, Washington or Wyoming, you'll need to purchase insurance coverage from monopolistic funds administered by those state governments. Private workers' compensation insurance is not available. Puerto Rico and the U.S. Virgin Islands have monopolistic state funds, too.
The other states offer some combination of the following:
Most businesses — except those in the monopolistic states of North Dakota, Ohio, Washington and Wyoming — will most likely purchase workers’ compensation insurance from a private insurance company. Shop around to find the best workers’ comp coverage for your business.
Self-insured businesses commit to paying for workers’ compensation benefits out of pocket instead of purchasing insurance policies. How workers' comp works — that is, which injuries are eligible and how claims are paid out — does not change.
Usually, states only allow very large companies with extensive resources to self-insure, since smaller companies might not be able to cover the costs of workers’ comp benefits themselves.
Many states allow companies in similar industries, such as the construction industry, to create group self-insurance pools. These companies share the costs of claims administration and excess insurance coverage.
An assigned risk pool or assigned risk plan is a workers’ compensation insurance program that will sell coverage to businesses that are denied by private insurance companies. Assigned risk pools or plans are available in every state except the four monopolistic fund states (North Dakota, Ohio, Washington and Wyoming) and are often administered by the National Council on Compensation Insurance.
Workers' compensation insurance costs may be higher for these harder-to-insure businesses.
on Tivly's website
Tivly works with over 200 insurance providers, matching you to the one who fits your needs!
Many states exempt the following categories of employees from workers’ compensation requirements:
Farmworkers. Many states don’t require workers’ comp coverage for agricultural workers at all. Some only require it if payroll exceeds a certain threshold or the farm has a certain number of employees.
Domestic workers employed in private homes, like house cleaners and nannies. Some states require workers’ comp coverage if these employees work more than a certain number of hours per week.
Real estate agents, if all their compensation is commission-based. Federal employees, who are covered under the Federal Employees' Compensation Act. Railroad workers, who are protected by the Federal Employers Liability Act.If you are a business owner, corporate officer, member of an LLC or hold another leadership position in your business, research your state’s workers’ compensation requirements closely. You may have to purchase coverage for yourself unless you request an exemption in writing. These rules may extend to your spouse or immediate family members who work in the business, too.
About the authorYou’re following Rosalie Murphy
Visit your My NerdWallet Settings page to see all the writers you're following.
On a similar note.
How to Find the Best Workers’ Compensation Insurance for Your Small Business How Much Is Workers’ Comp Insurance? How Does Workers’ Compensation Work? Employer’s Liability Insurance: What It Is, Which Businesses Need It MORE LIKE THIS Small BusinessThe best small-business insurance companies are financially secure and receive relatively few customer complaints.
Download the app
Disclaimer: NerdWallet strives to keep its information accurate and up to date. This information may be different than what you see when you visit a financial institution, service provider or specific product’s site. All financial products, shopping products and services are presented without warranty. When evaluating offers, please review the financial institution’s Terms and Conditions. Pre-qualified offers are not binding. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion® directly.
NerdUp by NerdWallet credit card: NerdWallet is not a bank. Bank services provided by Evolve Bank & Trust, member FDIC. The NerdUp by NerdWallet Credit Card is issued by Evolve Bank & Trust pursuant to a license from MasterCard International Inc.
Impact on your credit may vary, as credit scores are independently determined by credit bureaus based on a number of factors including the financial decisions you make with other financial services organizations.
NerdWallet Compare, Inc. NMLS ID# 1617539
California: California Finance Lender loans arranged pursuant to Department of Financial Protection and Innovation Finance Lenders License #60DBO-74812
Insurance Services offered through NerdWallet Insurance Services, Inc. (CA resident license no.OK92033) Insurance Licenses
NerdWallet™ | 55 Hawthorne St. - 10th Floor, San Francisco, CA 94105
