Workers Compensation for Solo Business Owners
Most solo owners aren’t required to carry workers compensation insurance, and some states exclude owners from coverage. Since our policy is for businesses with W-2 employees, we’ll help you check your state’s requirements and explore other coverage options you may need as a sole proprietor.
Check Your State’s Workers Compensation Rules for Sole Proprietors
Check your state’s workers comp guidelines to see if you’re eligible for coverage via your state’s fund:
We’ll Be Here When You Hire – Can We Help With Anything Else?
Insurance Canopy offers a wide range of small business insurance coverage types, serving 250+ industries across the U.S. Here are some of the other ways we can help you protect your business as a sole proprietor with fast, affordable policies:
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FAQs About Workers Compensation for Sole Proprietors
Do I need workers comp if I have zero employees?
In many states, solo owners aren’t required to carry workers compensation, but there are exceptions (especially in construction). Workers compensation rules vary by state and industry, so your best bet is always to check state rules. If you’re unsure, contact us to talk with a licensed agent — we are here to help!
My general contractor/venue asked for a workers compensation certificate. What can I provide if I’m solo?
If you aren’t eligible for workers comp as a sole proprietor (and it’s not required in your state), you may be able to provide an exemption certificate (waiver) instead. If that’s the case, follow the link to your state’s workers compensation to request a sole proprietor exemption. You can also ask whether providing proof of general liability insurance meets your state’s requirement.
What is a sole proprietor workers comp exemption (or waiver)?
A workers compensation waiver is a state-issued confirmation that you’re exempt from workers compensation requirements. It’s commonly used when a general contractor, venue, etc., asks for proof that you’re not required to carry it. You can request it from your state’s workers comp office and share it with anyone who asks for it.
What happens when I hire my first employee?
In many states, workers compensation becomes mandatory once you hire W-2 staff (sometimes even just one part-time employee). Check your state’s rules and get your quote for workers comp coverage before their first day.
How much is workers compensation for sole proprietors (for those who can get coverage)?
How much a sole proprietor will pay for workers compensation depends on class code, state rates, and payroll minimums/maximums (which are set by each state). Reach out to your state fund or assigned-risk plan to get estimates and help guiding you through the process.
I was told I need a COI — will a General Liability COI satisfy that?
A general liability COI (Certificate of Insurance) is not the same as proof of workers compensation coverage. Ask the requester if a workers compensation exemption plus a general liability COI meets their requirement.
What insurance do I need as a sole proprietor?
The right mix of coverages depends on your specific work and contract requirements. However, most sole proprietors hold a minimum of general liability and professional liability coverage. Learn more and explore other coverages designed to safeguard your business in our guide to sole proprietors’ small business insurance.
Where can I get other coverage I likely need?
Right here! Insurance Canopy offers a wide range of small business insurance coverage for sole proprietors: General Liability, Professional Liability (aka E&O), Tools and Equipment, Commercial Auto, Cyber Liability, and more.
Kyle Jude | Program Manager
Kyle Jude is the Program Manager for Insurance Canopy. As a dedicated program manager with 10+ years of experience in the insurance industry, Kyle offers insight into different coverages for small business owners who are looking to navigate business liability insurance.
Kyle Jude is the Program Manager for Insurance Canopy. As a dedicated program manager with 10+ years of experience in the insurance industry, Kyle offers insight into different coverages for small business owners who are looking to navigate business liability insurance.