Workers' Compensation Insurance in California
Reviewed by Guido Trevisan, CIC, ARMLicensed P&C brokerLicensed Property & Casualty Insurance BrokerUpdated
Menlo Insurance Services (Opero Labs Inc.), California license #6020106. Verify it with the California Department of Insurance.
Every California employer except the state must carry workers' compensation insurance or hold a certificate to self-insure, even with one employee. Anyone working for you is presumed to be an employee. Licensed contractors keep a certificate of coverage or a no-employee exemption on file with the CSLB, and from January 1, 2028 almost every contractor needs coverage.
Menlo can quote this coverage in California through 8 insurance markets.
Menlo's California figures
| Insurance markets Menlo can quote | 8 (as of November 9, 2026) |
|---|---|
| Workers' comp index rate | $1.86 per $100 of payroll, ranked 4 of 51 jurisdictions (170% of the $1.09 median). Oregon DCBS, 2024 premium rate ranking; all states |
California rules
Every employer except the state must secure the payment of compensation, with insurance from a licensed carrier or a certificate of consent to self-insure.
Source: California Legislative Information, Labor Code section 3700 (read September 23, 2026)
Coverage is required even with only one employee.
Source: California Department of Industrial Relations, Division of Workers' Compensation, Employer information (read September 23, 2026)
Anyone rendering service for you, other than an independent contractor or a person the law expressly excludes, is presumed to be an employee.
Source: California Legislative Information, Labor Code section 3357 (read September 23, 2026)
Licensed contractors must keep a certificate of workers' comp insurance, or a signed no-employee exemption, on file with the CSLB. C-8, C-20, C-22, C-39 and C-61/D-49 license holders must carry coverage whether or not they have employees.
Source: Contractors State License Board, Workers' Compensation Requirements (read September 23, 2026)
From January 1, 2028, every contractor needs a certificate of coverage on file; only a joint venture with no employees may file the no-employee statement instead (SB 1455, Chapter 485, Statutes of 2024).
Source: California Legislative Information, SB 1455 (Ashby), Contractors: licensing (read September 23, 2026)
An uninsured employer can be served a stop order barring all employee labor until coverage is in place.
Source: California Legislative Information, Labor Code section 3710.1 (read September 23, 2026)
With the stop order comes a penalty of $1,500 per employee on the payroll at the time.
Source: California Legislative Information, Labor Code section 3722 (read September 23, 2026)
Knowingly failing to secure coverage is a misdemeanor punishable by up to a year in county jail, a fine of up to double the unpaid premium (at least $10,000), or both.
Source: California Legislative Information, Labor Code section 3700.5 (read September 23, 2026)
For policies starting on or after September 1, 2026, the Insurance Commissioner adopted an average advisory pure premium rate of $1.65 per $100 of payroll, up 6.6%. Insurers file their own rates and are not bound by it.
Source: California Department of Insurance, Commissioner Lara takes action to maintain stable workers' compensation market amid rising costs (July 10, 2026) (read September 27, 2026)
How these figures were collected
The market count is the number of insurers and insurance programs with an enabled quoting route for this coverage in California in Menlo's carrier configuration (revision 2377) on November 9, 2026.
Each rule above links to the statute or agency page it comes from, read on the date shown.
Related
- Workers' Compensation Insurance
- General Liability Insurance in California
- Workers' Comp Insurance Cost in California (2026)
- California Workers' Comp Class Codes: How WCIRB Classifications Work (2026)
- Workers' Comp Exemption in California: Who Is Exempt, the CSLB Form, and the 2028 Contractor Rule
- Workers Comp Ghost Policy: What It Is, What It Costs, and the Traps
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