Workers Compensation Insurance: A Complete Guide for Employers
July 9, 2026
How workers compensation insurance works, what Part One's statutory benefits cover, Part Two's employers liability coverage, and how your premium is calculated.
Read guideWorkers' Compensation Insurance
Support employees after a work related injury and meet California insurance requirements. We classify payroll carefully, compare carriers, and help you prepare for audits.
We shop the market for you, no broker fees
Eight relevant markets are shown for comparison. Availability depends on the risk and location, and a logo does not imply a direct appointment.
AmTrust
Workers compensation
The Hartford
Small business workers compensation
Travelers
Workers compensation programs
Chubb
Middle market workers compensation
Markel
Specialty workers compensation
Great American
Workers compensation programs
Builders Mutual
Construction workers compensation
Society Insurance
Main street workers compensation
Required for nearly every California employer with employees
- Contractors and trades
- Restaurants and hospitality
- Professional offices
- Manufacturers and warehouses
What changes your premium
These details help insurers assess your business and price the coverage. Terms and available options vary by insurer.
- Your class codes, which is where most of the premium is decided
- Annual payroll by class code
- Your experience modification factor
- The state, and the rate filings in force there
- Uninsured subcontractors, who land on your audit
- Owner and officer inclusion or exclusion elections
- Your claim history and how open claims are reserved
- Safety programs and return to work practices
How it works
10 minute form
A few questions about your business or home.
We shop the market
We compare carriers and read the forms line by line.
Quote and bind
We pick the best policy and get you covered.
What this policy can cover
Medical care
Treatment for job-related injuries and illnesses.
A framer falls from a ladder and needs surgery plus months of physical therapy. Medical treatment alone can run past six figures, and the policy pays it with no deductible to the injured worker.
Lost wages
A portion of income while an injured employee recovers.
Disability and death benefits
Benefits for lasting impairment or a workplace death.
Employers liability
Part Two of the policy, which responds to certain injury lawsuits.
Why is this one not optional?
Because California requires it once you have an employee, and some licensed contractor classifications must carry it even without employees. It is also the only policy that answers for your own people. Every liability form on this site excludes employee injury by name, so there is no version of this you can absorb somewhere else.
Businesses this coverage may fit
The business hiring its first employee
The obligation starts on day one, not at the first payroll run. We get the policy bound before the start date so there is no uninsured window.
The contractor paying 1099 subs
Uninsured subcontractors usually roll into the hiring business's exposure at audit, sometimes at a higher class code than your own crew. Knowing that before the audit is worth more than any rate you can shop.
The business coming off a bad audit
A surprise bill is almost always a classification or a payroll allocation issue rather than a rate issue. We read the audit worksheet and the mod worksheet before we shop anything.
The employer nobody will quote
Hard classes, a high mod or a lapse in coverage can close the standard market. There are still real options, including the state fund and the surplus market.
How your limits and deductibles get set
Start with your contract requirements and potential losses. Then compare the cost of higher limits with what you could afford to pay yourself.
- 01
Start with the contract
Check the insurance limits and endorsements required by your lease, client agreements or project contract.
- 02
Then size the exposure
Consider property values, the work you do, possible injury claims and legal defense costs.
- 03
Then price the step up
Where available, compare more than one limit and deductible. A lower premium may leave you paying more after a loss.
- 04
Then review it at renewal
Review changes in revenue, payroll, property values and operations before renewing your coverage.
Frequently asked questions
Is workers' compensation required in California?
Yes. California requires workers' compensation for virtually every employer with one or more employees, and going without it carries serious penalties.
What does workers' compensation cover?
It covers medical care, a portion of lost wages, disability and death benefits, and employers liability for job-related injuries and illnesses.
How is the premium calculated?
Premium is based on your payroll, employee class codes, and your experience modification factor, which reflects your claims history.
What is an experience mod?
The experience modification factor compares your claims history to similar businesses and raises or lowers your premium accordingly.
Are owners and officers covered?
Sole proprietors and some officers can elect to include or exclude themselves. We set it up to match how you run the business.
Does workers' compensation cover an injury to a customer?
No. It responds only to your own employees. A customer, a vendor or a passerby who is injured is a general liability claim.
Does it cover a crash in a company vehicle?
The injured employee's medical care and lost wages, yes. The vehicle itself, and anything you owe to the other driver, is commercial auto.
Do I need it if everyone is a 1099 contractor?
Usually yes, and that is the single most expensive misunderstanding on this line. If your subs cannot produce their own certificates, an auditor can add their payments to your exposure and charge you for them. In California, licensed contractors are required to carry coverage whether or not they have employees.
Can I exclude myself as the owner?
In most cases you can elect to exclude owners and officers, and in some cases you should not. Excluding yourself removes your own medical coverage for a work injury, and a health plan may deny a claim it considers work related. It is a real decision, not a checkbox, so we walk through it.
Get workers' compensation built around your payroll
Share your work, employee, and payroll details. We will compare carriers and help you understand the audit process.