Workers Compensation Insurance Calculator
Estimate your workers compensation insurance premium in seconds. Built for small business owners across all industries. No email required to see results.
By Emiliano · Last updated 2026-09-27
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How this calculator works
This calculator estimates workers' compensation insurance costs by multiplying your annual payroll by a base rate per $100 of payroll, then applying industry class code factors and state multipliers. Class codes reflect injury frequency and severity by industry, while state multipliers adjust for the regulatory environment in your primary state.
Formula source: NCCI class codes and state workers' compensation rating bureau filings.
📊 See how your state compares — 50-state cost analysis
How Much Does Workers Comp Insurance Cost?
Workers compensation insurance typically costs $0.25 to $5.80 per $100 of payroll, depending on your industry and state. A clerical business with $250,000 in payroll might pay $600–$900 per year. A construction company with the same payroll could pay $11,000 or more.
- Lowest rate: Clerical/office work — $0.25 per $100 payroll
- Highest rate: Trucking/delivery — $5.80 per $100 payroll
- 23x spread between the cheapest and most expensive class codes
- Average small business premium: $1,200–$4,500 per year (3–5 employees)
- 46 states require workers' comp coverage once you hire non-owner employees
What Factors Affect Your Premium?
1. Industry Classification
Each industry has a "class code" with a base rate. Clerical and office work has the lowest rates because of minimal physical risk. Construction, trucking, and manufacturing have the highest rates because of injury frequency and severity.
2. Annual Payroll
Premiums are calculated per $100 of payroll. Higher payroll means more exposure, but also more premium dollars. Larger employers often get experience modification discounts that reduce their effective rate.
3. State Regulations
Workers comp is regulated at the state level. Rates vary significantly. California has some of the highest rates in the country; Texas allows private competition and often has lower rates.
4. Claims History
If your business has a history of workers comp claims, your experience modification rate (EMR) increases, raising your premium. A clean claims history can earn a discount of 5–20%.
- State rates vary 5x — from $0.50 per $100 payroll in North Dakota to $2.52 in Hawaii
- Experience modification (EMR) can swing premiums 5–20% up or down
- Safety program discounts save 10–25% over 3+ years with clean claims
Frequently Asked Questions
Is workers comp insurance required?
Almost every state requires businesses with employees to carry workers compensation insurance. Requirements vary by state and by number of employees. Sole proprietors with no employees are often exempt.
What does workers comp cover?
Workers compensation covers medical expenses, lost wages, and rehabilitation for employees injured on the job. It also provides death benefits to families of workers killed in workplace accidents. In exchange, employees generally cannot sue their employer for workplace injuries.
How can I lower my premium?
Maintain a clean claims history, implement workplace safety programs, and classify employees correctly. Misclassification is the most common reason businesses overpay. Installing safety training programs can reduce premiums by 10–25% over time.
Part of our guide to Commercial Insurance for Small Business.