We found that CopperPoint, Erie, Everest Insurance, Great American, ICW, Pinnacol Assurance and Texas Mutual are the best workers’ compensation insurance companies. Each company scored five out of five stars in our evaluation of 25 large insurers.
Workers’ compensation insurance is essential to a small company. It covers accidents and illnesses suffered by an employee due to their job. Without it, your business could face major financial consequences.
- Get Workers' Comp Quotes For Your Business
- Best Workers’ Compensation Insurance Companies of 2024
- CopperPoint
- Erie
- Everest Insurance
- Great American
- ICW
- Pinnacol Assurance
- Texas Mutual
- Arch Capital
- AF Group
- Fairfax Financial
- Old Republic
- The Hartford
- Zurich
- Summary: Workers' Compensation Insurance Ratings
- 50 Largest Workers' Compensation Insurance Companies
- Is Workers' Compensation Insurance Required?
- How Much Does Workers' Compensation Insurance Cost?
- What Does Workers' Compensation Insurance Cover?
- What Does Workers' Compensation Insurance Not Cover?
- How Can I Get the Best Workers' Compensation Insurance?
- Methodology
- Best Workers' Compensation Insurance FAQ
- Next Up In Business Insurance
Get Workers' Comp Quotes For Your Business
Best Workers’ Compensation Insurance Companies of 2024
Summary: Workers' Compensation Insurance Ratings
50 Largest Workers' Compensation Insurance Companies
Workers’ compensation insurance pays out when employees become injured on the job or sick because of their work—such as when an employee gets sick from chemicals at work.
Coverage includes an employee’s medical treatment and ongoing care, missed wages, disability benefits and funeral costs if the employee dies in a work-related incident.
If you’re shopping for workers’ comp, you may be wondering who the biggest workers’ comp insurers are. See a ranking of market share below.
Is Workers' Compensation Insurance Required?
Workers’ compensation laws are based on state statutes, so requirements vary depending on where you are doing business. Check the workers’ compensation insurance laws in your state to see how much insurance you are required to buy.
If your business operates in additional states, you will have to follow those state statutes as well.
Workers’ Compensation Insurance Rules by State
What Happens if I Don’t Have Workers’ Compensation Insurance?
Workers’ compensation insurance is state-mandated, so each state has its own workers’ compensation laws and penalties. Employers that don’t carry the required coverage could face fines, criminal charges or jail time.
Not having workers’ comp insurance also opens businesses up to lawsuits. If you don’t carry workers’ comp insurance and an employee gets injured or becomes ill because of the job, they could sue you in an effort to recoup their medical expenses.
This is especially important to keep in mind as work-related injuries and illnesses are on the rise. Private industry employers reported 2.8 million nonfatal workplace injuries and illnesses in 2022, up 7.5% from 2021, according to the most recent data from the U.S. Bureau of Labor Statistics. Injuries increased 4.5% to 2.3 million cases, and illnesses jumped 26% percent to 460,700 cases.
How Much Does Workers' Compensation Insurance Cost?
Workers’ compensation insurance costs small business owners an average of $47 a month, or $560 annually, according to Trusted Choice, a group for independent insurance agents.
This is an average for “middle of the pack” small businesses, in terms of business size and risk level. Larger companies in an industry with more risk, such as construction, will pay much more.
Median Workers’ Compensation Premium by Industry
What Factors Affect my Workers’ Comp Insurance Premium?
There are several factors that can impact how much you pay for workers’ compensation insurance, including:
- Location. Your state dictates how much workers’ comp coverage you need. Employers in states with higher requirements are likely to pay more for their workers’ comp insurance.
- Type of business. Your industry will affect how much you pay for your workers’ comp insurance. Some jobs are more dangerous than others, such as a building designer compared to a construction worker.
- Claims history. Your insurer will look at your company’s history of workers’ compensation claims to determine your company’s likelihood of filing a claim.
- Payroll size. Businesses with more employees and higher payroll pay more in workers’ comp premiums.
What Does Workers' Compensation Insurance Cover?
There are several facets of a workers’ comp policy, including:
Medical Expenses
A workers’ compensation insurance policy offers coverage for injured or ill employees’ medical treatment when the cause relates to their job. This can include payment for doctor’s visits, emergency room visits, surgery, medication and ongoing care.
Medical expenses related to Covid might be covered, depending on your state and occupation. The National Council on Compensation Insurance tracks legislation related to workers’ comp coverage of Covid.
Lost Wages
When an employee is injured or becomes ill because of their job, it often leads to time off for healing. During this time, your workers’ compensation insurance typically pays partial wages. This helps ensure the affected parties still have income during their recovery period.
Disability Benefits
If your employee sustains a job-related injury or illness that results in a disability, full or partial disability benefits can help your employee pay their medical bills and supplement some of their lost wages.
Disability benefit classifications
Continuing Care
If an employee has a work-related injury or illness that requires extended care, workers’ compensation insurance can help pay for ongoing care like physical therapy.
Death Benefits
If the worst happens and your employee dies from a work-related injury or illness, your workers’ compensation insurance will usually cover funeral and burial expenses as well as survivor benefits for their beneficiaries.
What Does Workers' Compensation Insurance Not Cover?
There are some work-related injuries and illnesses that workers’ compensation insurance generally will not cover.
- Commute. Accidents that happen on the way to or from work are usually not covered.
- Alcohol or drugs. If an injury occurs while the employee is under the influence of alcohol or illegal drugs, workers’ comp insurance will likely not cover it.
- Intentional injuries. Workers’ comp policies exclude injuries that occur intentionally.
- Recreation. Any injuries from recreational activities are typically excluded, even if they occur on the work premises.
- Food poisoning. If you get food poisoning on your lunch break from food you bought or brought from home, this does not qualify for workers’ compensation because the break was not work-related.
A workers’ compensation insurance policy may have other exclusions, so check your policy carefully.
How Can I Get the Best Workers' Compensation Insurance?
To get the best workers’ comp insurance for your business, follow these steps.
- Learn state requirements. Even for industries that are generally considered safe, some level of workers’ comp insurance may be required in each state where you have employees. Check your state workers’ compensation laws to make sure your company is in compliance.
- Determine where to buy insurance. Your state also decides who sells and handles workers’ comp policies: a state-run agency, private insurance companies or the state itself. Four states—North Dakota, Ohio, Wyoming and Washington—require employers to buy workers’ comp insurance from a government-operated fund, rather than from a private insurer. If your company has employees in one of these monopolistic states, or sends employees to work there, you may need to purchase workers’ comp insurance from its state fund.
- Work with an agent. In states where you’re permitted to buy workers’ comp insurance from a private insurer, you can work with an insurance agent to compare quotes. Note that these quotes may change after insurance companies have taken a closer look at your business risk factors.
- Lower your risk to lower your premium. For lower workers’ comp premiums, focus on safety in the workplace. Assigning a safety manager, holding regular safety meetings and keeping your buildings and equipment up to code may get you a discount.
Methodology
We scored the 25 largest workers’ compensation insurance companies (with available data) based on their financial strength and the level of workers’ comp complaints against them in 2022.
Level of complaints (90% of the score): We scored companies based on upheld complaints made to state insurance departments nationwide and collected by the National Association of Insurance Commissioners.
Financial strength (10% of the score): We scored companies based on their financial strength ratings from AM Best.
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Best Workers' Compensation Insurance FAQ
What is workers' compensation insurance?
Workers’ compensation insurance is a type of business insurance that pays for employees’ medical care and partial lost wages if they become injured or ill because of their job. In the event of a work-related accident or illness, this insurance covers several expenses so the business owner does not have to pay out of pocket.
Nearly every state requires employers to carry workers’ comp insurance. The exact amount of coverage required varies depending on the type of business and location.
Do all employees need to be covered by workers' compensation insurance?
When it comes to workers’ compensation laws, most states have a small number of exclusions for certain employees. For example, in Florida, corporate officers can exclude themselves from workers’ compensation coverage. In New York, sole proprietors or partners without employees don’t need coverage. And in Pennsylvania, licensed real estate salespeople or brokers are excluded.
In two states—Texas and South Dakota—workers’ compensation insurance is not required by law for any employer. However, it is always a good idea to ensure you have the right financial protection in place for your business.
How can I save money on workers' compensation insurance?
To save money on workers’ comp insurance, focus on improving safety in the workplace. Insurance companies will look at the following factors when determining your premium:
- Safety. If your buildings and equipment are up to code and you have a dedicated safety manager who holds regular safety meetings, you may get a discount on your workers’ comp premiums.
- Audits. If you are proactive in getting waivers signed and having all of your paperwork in order for employees and subcontractors, this can help keep your workers’ comp rates low.
- Experience modification rating. This metric represents your company’s claims history. If your company historically has a low rate of workers’ comp insurance claims for your industry, it may result in lower premiums. Having a workplace safety program in place can lower your company’s experience modification rating.
Is workers' compensation insurance required for one employee?
Most states require workers’ compensation for all companies, even those with just one employee. Other states require businesses with three or five workers to have workers’ comp, while others have insurance requirements based on the company type.
Whether your state requires workers’ compensation insurance or not, the coverage can play a vital part of your small business insurance protection.
Can I get workers' compensation insurance if I'm self employed?
Yes, you can get workers’ compensation insurance if you’re self-employed. Nearly all states require that employers get workers’ compensation as part of their small business insurance coverage.
Although your state may not require workers’ compensation insurance if you’re self-employed, you may need it if you work as a general contractor or subcontractor.
What is a workers' compensation insurance audit?
A workers’ compensation audit is when your business insurance company verifies your company’s payroll. That’s because your workers’ compensation costs are partially based on the compensation paid to your employees, including benefits.
You can prepare for a workers’ compensation audit by gathering your payroll records, employee records, cash expenses, tax reports and certificates of insurance for any subcontractors who have worked for you over the past year.