Workers' Comp Requirements by State (All 50, One Table)

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Every hiring decision in America arrives with the same fine-print question: does workers' comp kick in now? The honest one-line answer — in most states, at your first employee — hides the part that generates the fines: a dozen states use numeric thresholds instead, four states won't sell you a private policy at all, and nearly every state counts part-timers. Here's the full table, plus the exemptions and edge cases that actually decide whether you're compliant. One standing caveat before the table: these are the general private-employer rules. Construction carve-outs, farm and family exemptions, and hour-based nuances vary by state — confirm your specific situation with your state agency or a licensed agent in your state before you rely on any row.

The default rule: first employee, heads not hours

Most states tie the mandate to employing anyone at all: hire one person — full-time, part-time, seasonal, family — and coverage is required. Threshold states generally count employees, not hours, with the exceptions flagged in the table. And "employee" is the state's definition, not yours: several states presume construction workers are employees no matter what the contract says, which is where the 1099 trap lives. Our 1099 vs. W-2 guide covers misclassification — the difference between a routine audit and a stop-work order.

The monopolistic four: OH, ND, WA, WY

Four states run monopolistic state funds: Ohio (BWC), North Dakota (WSI), Washington (L&I), and Wyoming (DWS). In these states you buy workers' comp from the state itself — private carriers can't sell it, no marketplace or direct writer quotes it there, and an out-of-state employer with workers in one of the four registers with that state's fund. Wyoming adds a wrinkle: fund coverage is required for occupations the state classifies as hazardous and elective for some others. One consequence worth knowing: monopolistic-fund policies generally don't include the employer's liability coverage that private policies bundle elsewhere — ask about stop-gap coverage, commonly added through your general liability policy.

All 50 states (and DC), one table

State	Coverage generally required at	Notes
Alabama	5+ employees	—
Alaska	First employee	—
Arizona	First employee	—
Arkansas	3+ employees	—
California	First employee	—
Colorado	First employee	—
Connecticut	First employee	Part-timers count
Delaware	First employee	—
District of Columbia	First employee	—
Florida	4+ employees	Construction: first employee
Georgia	3+ employees	—
Hawaii	First employee	—
Idaho	First employee	—
Illinois	First employee	—
Indiana	First employee	—
Iowa	First employee	—
Kansas	First employee	Exempt while gross annual payroll stays at or under $20,000
Kentucky	First employee	—
Louisiana	First employee	—
Maine	First employee	—
Maryland	First employee	—
Massachusetts	First employee	—
Michigan	3+ employees	Or 1 employee working 35+ hours a week for 13+ weeks
Minnesota	First employee	—
Mississippi	5+ employees	—
Missouri	5+ employees	Construction: first employee
Montana	First employee	—
Nebraska	First employee	—
Nevada	First employee	—
New Hampshire	First employee	—
New Jersey	First employee	—
New Mexico	3+ employees	Construction: stricter rules
New York	First employee	—
North Carolina	3+ employees	—
North Dakota	First employee	Monopolistic — buy from WSI
Ohio	First employee	Monopolistic — buy from BWC
Oklahoma	First employee	—
Oregon	First employee	—
Pennsylvania	First employee	—
Rhode Island	First employee	—
South Carolina	4+ employees	—
South Dakota	No general mandate	Elective — skipping strips key legal defenses
Tennessee	5+ employees	Construction: first employee
Texas	Optional for most private employers	Non-subscribers lose legal defenses
Utah	First employee	—
Vermont	First employee	—
Virginia	More than 2 employees	—
Washington	First employee	Monopolistic — buy from L&I
West Virginia	First employee	—
Wisconsin	3+ employees	Or any employer paying $500+ in wages in a quarter
Wyoming	See notes	Monopolistic (DWS) — required for listed hazardous occupations

General rules as of this writing; thresholds shift and exemptions are trade-specific, so verify with your state before staffing up.

Sole proprietors, partners, and officers

The mandate is about employees, so a true solo operation usually isn't required to cover itself: sole proprietors and partners are excluded by default in most states, with the option to opt in. Corporate officers and LLC members typically count as employees unless they file an exclusion form. Two real-world reversals. First, construction — some states and many licensing boards tighten or remove the exemptions for building trades. Second, contracts — general contractors routinely require subs to carry coverage or opt in regardless of statute, because an uninsured sub's payroll lands on the GC's own policy at audit. That's why the COI-collection ritual exists: our workers' comp audit guide shows the worksheet, and our certificate of insurance explainer covers the document itself.

What skipping required coverage costs

Qualitatively, because the specifics vary by state: stop-work orders that freeze the job until you're covered, fines that accrue per day or per employee, personal liability for the full cost of an injured worker's claim — medical bills and wage replacement, uncapped by any policy — and, in a number of states, criminal exposure for willful noncompliance. The premium is the cheap side of this comparison.

What it costs when you do buy

As of mid-2026, Insureon's published median for small-business workers' comp is $54 a month. The machinery under any quote is a formula: rate × (payroll ÷ $100) × experience mod, with the rate set by your class code and state. State index studies put the national average around $1.03 per $100 of payroll, with North Dakota's fund lowest at roughly $0.67, and California (advisory pure premium around $1.52 after the September 2025 filing) and New Jersey among the highest. Our workers' comp cost guide works the formula with examples, and our methodology page documents where every figure comes from.

Buying it

Outside the monopolistic four, workers' comp is sold by private carriers and priced off your class codes and payroll — Compare quotes for workers' comp at Simply Business to see several carriers' numbers from one application. Bundling it with liability for a contract package? Compare quotes at Simply Business prices the lines together. In Ohio, North Dakota, Washington, or Wyoming, go straight to the state fund. And if you're not sure workers' comp is even the policy your situation requires, our coverage checker maps your trade, state, and headcount to what's required by law, commonly required by clients, or merely worth considering.

Last reviewed: August 2026. The figures on this page are typical published ranges, not quotes; our methodology explains where each one comes from and how often we recheck it.