How Much Does Workers’ Comp Insurance Cost?

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what is workers comp insurance video

What Is Workers’ Compensation Insurance?

Workers' compensation insurance gives employees medical, wage and other financial benefits if they are injured or become ill on the job. This coverage is required in most states. Workers' compensation insurance is also known as workman's comp or workers' comp insurance.
how does workers comp work infographic

How Much Is Workers’ Comp Insurance?

• workers comp insurance costMost of our customers with less than $300,000 annually in payroll paid an average of $81 a month for workers’ compensation insurance, also known as workers’ comp insurance.1
It’s important to know that the cost of workers’ compensation insurance varies between businesses. Insurance companies look at different factors when determining premiums, so there’s no standard cost. Factors can include:
  • Payroll accessed through an audit
  • Industria
  • Claims history
  • Tipo de trabajo
Most states require businesses to have workers’ compensation insurance if they have employees. What does workers’ comp cover? It helps employees recover from serious work-related injuries or illnesses. The benefits received by the employees are not taxable at the federal or state level.

What Is the Average Workers’ Compensation Insurance Cost for Customers of The Hartford?

On average, small businesses insured by The Hartford pay an average of $1,028 per year, or $86 a month, for workers’ compensation coverage.2 Insurance companies use different factors to determine workers’ compensation insurance costs. There isn’t one set rate for small business customers. The price each business pays depends on many variables, starting with what they do.
Payroll Band Average Yearly Premium3
<=$50K $668.21
$50K-$100k $813.63
$100K-$150k $1,040.34
$150K-$300k $1,361.96
$300K-$500k $2,033.52
$500K-$1M $3,022.28
$1M+ $4,693.88
Check out our quiz if you’re interested in learning how to calculate the workers’ compensation insurance cost for your business.

What Are the Factors on Which Workers’ Compensation Premiums Are Based?

Since not all workers’ comp premiums are the same, calculating workers’ comp can include a few things. Several factors that can affect workers’ comp rates include:

State Requirements

Workers’ compensation laws vary by state. Most states require businesses with at least one employee to have workers’ compensation insurance, but there are exceptions. For example, in Arkansas small business owners with less than three employees don’t need coverage.
You can find your state’s average cost of workers’ compensation premium in the table below:4
Estado Average Issued Premium**
AL $1,448
AR $998
AZ $1,116
CA $1,600
CO $759
CT $1,555
DC $1,081
DE $976
FL $1,149
GA $1,041
IA $505
ID $1,211
IL $1,062
IN $862
KS $946
KY $837
LA $1,069
MA $990
MD $839
ME $1,220
MI $740
MN $1,181
MO $1,428
MS $1,435
MT $1,033
NC $1,009
NE $809
NH $1,149
NJ $1,079
NM $1,423
NV $906
NY $998
OK $1,150
OR $1,166
PA $935
RI $1,721
SC $1,234
SD $703
TN $1,109
TX $576
UT $666
VA $840
VT $1,300
WI $1,173
WV $557
It’s a good idea to work with a business insurance specialist to make sure you understand and comply with your local laws.

The Number of Employees and Payroll

The bigger your staff, the more it’ll cost for workers’ comp coverage. That’s because your business’ payroll is part of the premium (annual cost) calculation for workers’ compensation insurance. Your cost is calculated per $100 of payroll. So, if your payroll is larger, you can expect to pay a higher premium.

Types of Work Done by Employees

Jobs with higher levels of risk result in higher workers’ comp costs. For example, an accountant faces a lower risk of injury than a lumberjack. Riskier work that has a greater potential for workplace injuries, illnesses or death can cost more for coverage.

Claims History

Your claims history can also impact your workers’ compensation cost. If you’ve submitted a large amount of workers’ compensation claims in the past, you will likely pay a higher rate. The more severe these claims are, the higher your cost will be as well.

Pay-as-You-Go Workers’ Comp Insurance

Pay-as-you-go workers’ comp insurance allows you to pay for coverage based on your actual payroll. There’s no downpayment and you pay for your workers’ comp coverage based on your schedule for payroll. 
If you’re wondering how to get pay-as-you-go workers’ comp insurance, you can call your insurer or your payroll provider.

How Do Workers’ Comp Class Codes Impact Insurance Cost?

The National Council on Compensation Insurance (NCCI) maintains workers’ comp class codes. The NCCI bases class codes on the types of jobs that workers’ do, which helps insurers calculate worker’s compensation cost. Having high-risk class code employees can result in a higher workers’ compensation cost.

4 Ways To Save on the Cost of Workers’ Compensation Insurance

1. Training Your Employees

Training employees on proper workplace procedures can help reduce the likelihood of injuries, which could help lower your workers’ compensation insurance cost.

2. Choosing the Right Limits and Deductible

Raising your deductible can help lower your insurance rate. Your deductible is the amount you pay out of pocket before your insurance company covers a claim.

3. Having Safety Standards

Prioritizing workplace safety at your business can help you identify and mitigate workplace hazards before they occur. This can help lower the amount of workers’ compensation claims submitted.

4. Bundling Your Policies

Bundling can help you save money on insurance. For example, bundling your workers’ compensation and general liability coverages could help you save on both policies.
At The Hartford, we’re backed by more than 200 years of experience. Our specialists are ready to help you get workers’ comp insurance and any other type of coverage you may need at the right price.
Obtenga una cita today and see how we can help protect your business.
Última actualización: 10 de mayo de 2024
1,2,3,4 Premium amounts presented are based on monthly premium paid by The Hartford's Small Business customers between 1/1/22 and 9/14/23 for 12-month policies. Premium is derived from a number of factors specific to your business and may vary.
Divulgaciones adicionales a continuación.
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