Small Business Insurance Requirements by State
What insurance does your business need? Requirements vary by state, industry, and number of employees. Here's what you need to know.
Workers' Compensation InsuranceRequired
Covers medical costs and lost wages for employees injured on the job. Required in almost every state.
General Liability InsuranceRecommended
Protects against third-party claims for bodily injury, property damage, and advertising injury.
Commercial Auto InsuranceVaries by State
Required if your business owns or uses vehicles. Personal auto policies don't cover business use.
Professional Liability / E&ORecommended
Covers claims of negligence, mistakes, or failure to deliver professional services.
Business Owners Policy (BOP)Recommended
Bundles general liability and property insurance at a discount. Good for small businesses.
Insurance by Industry
Insurance requirements and costs vary dramatically by industry. These guides break down the specific coverages you need.
View all industry insurance guides →
Workers' Comp Requirements — Quick Reference
| State | Required? | Threshold | Avg Cost / $100 Payroll | Details |
|---|---|---|---|---|
| Alabama | Yes | 5 employees | $1.63 | Alabamaguide → |
| Alaska | Yes | 1 employee | $2.15 | Alaskaguide → |
| Arizona | Yes | 1 employee | $1.20 | Arizonaguide → |
| Arkansas | Yes | 3 employees | $0.72 | Arkansasguide → |
| California | Yes | 1 employee | $1.56 | Californiaguide → |
| Colorado | Yes | 1 employee | $0.88 | Coloradoguide → |
| Connecticut | Yes | 1 employee | $1.68 | Connecticutguide → |
| Delaware | Yes | 1 employee | $1.38 | Delawareguide → |
| District of Columbia | Yes | 1 employee | $1.22 | District of Columbiaguide → |
| Florida | Yes | 4 employees (general), 1 employee (construction) | $1.10 | Floridaguide → |
| Georgia | Yes | 3 employees | $1.22 | Georgiaguide → |
| Hawaii | Yes | 1 employee | $2.08 | Hawaiiguide → |
| Idaho | Yes | 1 employee | $0.83 | Idahoguide → |
| Illinois | Yes | 1 employee | $1.31 | Illinoisguide → |
| Indiana | Yes | 1 employee | $0.77 | Indianaguide → |
| Iowa | Yes | 1 employee | $1.09 | Iowaguide → |
| Kansas | Yes | Gross annual payroll > $20,000 | $1.06 | Kansasguide → |
| Kentucky | Yes | 1 employee | $0.96 | Kentuckyguide → |
| Louisiana | Yes | 1 employee | $1.16 | Louisianaguide → |
| Maine | Yes | 1 employee | $1.15 | Maineguide → |
| Maryland | Yes | 1 employee | $1.05 | Marylandguide → |
| Massachusetts | Yes | 1 employee | $0.80 | Massachusettsguide → |
| Michigan | Yes | 1 employee | $1.12 | Michiganguide → |
| Minnesota | Yes | 1 employee | $1.24 | Minnesotaguide → |
| Mississippi | Yes | 5 employees | $1.50 | Mississippiguide → |
| Missouri | Yes | 5 employees (general), 1 employee (construction) | $1.28 | Missouriguide → |
| Montana | Yes | 1 employee | $1.28 | Montanaguide → |
| Nebraska | Yes | 1 employee | $1.10 | Nebraskaguide → |
| Nevada | Yes | 1 employee | $1.06 | Nevadaguide → |
| New Hampshire | Yes | 1 employee | $1.10 | New Hampshireguide → |
| New Jersey | Yes | 1 employee | $1.52 | New Jerseyguide → |
| New Mexico | Yes | 3 employees | $1.16 | New Mexicoguide → |
| New York | Yes | 1 employee | $1.68 | New Yorkguide → |
| North Carolina | Yes | 3 employees | $1.08 | North Carolinaguide → |
| North Dakota | Yes | 1 employee | $0.67 | North Dakotaguide → |
| Ohio | Yes | 1 employee | $0.92 | Ohioguide → |
| Oklahoma | Yes | 1 employee | $1.42 | Oklahomaguide → |
| Oregon | Yes | 1 employee | $1.07 | Oregonguide → |
| Pennsylvania | Yes | 1 employee | $1.41 | Pennsylvaniaguide → |
| Rhode Island | Yes | 1 employee | $1.42 | Rhode Islandguide → |
| South Carolina | Yes | 4 employees | $1.30 | South Carolinaguide → |
| South Dakota | Yes | 1 employee | $1.13 | South Dakotaguide → |
| Tennessee | Yes | 5 employees (general), 1 employee (construction/mining/coal) | $1.18 | Tennesseeguide → |
| Texas | Voluntary | No threshold — voluntary for most private employers | $0.86 | Texasguide → |
| Utah | Yes | 1 employee | $0.87 | Utahguide → |
| Vermont | Yes | 1 employee | $1.62 | Vermontguide → |
| Virginia | Yes | 2 employees | $0.73 | Virginiaguide → |
| Washington | Yes | 1 employee | $1.52 | Washingtonguide → |
| West Virginia | Yes | 1 employee | $1.13 | West Virginiaguide → |
| Wisconsin | Yes | 3 employees | $1.06 | Wisconsinguide → |
| Wyoming | Yes | 1 employee | $0.85 | Wyomingguide → |