Workers’ Compensation Insurance

Protect your employees and your business.

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Workers’ compensation can help protect your employees and your business after a workplace injury or illness. It can help pay for:

Medical expenses

Medical expenses

Includes examinations, treatments and rehabilitation.

Lost wages

Lost wages

Gives employees time to recover from an injury before returning to work.

Survivor benefits

Survivor benefits

Supports families by helping to cover funeral costs and income replacement.



Helps employees who need to learn skills and enter a new field.

Permanent injury

Permanent injury

Provides benefits for employees who can no longer work due to injury.

Employers liability

Employers liability

Protects your business from financial losses if an employee files a lawsuit against you.

Learn more about Workers’ Comp insurance:


What is Workers’ Compensation insurance?

Workers’ compensation can help cover expenses for medical care, lost wages and other costs after a workplace injury.

It's also referred to as workman's compensation insurance or workman's comp.

It can help injured workers if they are hurt on the job and it can protect business owners from significant financial losses after an accident.

For example, workers’ comp can help cover medical treatment and lost wages if a heavy beam lands on a construction worker’s foot and causes a compound fracture.

Without insurance, the employer could be responsible for all related costs, which could add up to tens of thousands of dollars.

But workers’ comp is not just for high-risk jobs.

Repetitive-motion injuries (i.e., carpal tunnel), slip-and-fall accidents and strains can happen at relatively safe businesses.

Many small business owners also buy workers’ comp because it’s required in most states as soon as you hire your first employee.

Is Workers’ Comp insurance required by law?

Business owners in most states are legally required to have workers’ compensation coverage if they have employees.

However, the laws are different in each state.

Colorado law requires coverage as soon as you hire an employee. Tennessee business owners are not required to have coverage until they have five or more employees.Check out the section lower on this page for more details on the workers’ comp rules in your state.

Even when it’s not required by law, many business owners buy coverage so they have financial protection if an employee experiences a work-related injury or illness.

You might be required to have coverage to get a license or permit

Workers’ comp may also be required to get a license for some professions. For example, many states ask for proof of workers’ comp insurance with their general contractor license requirements.

If you need to obtain coverage to satisfy a license or bid requirement quickly, you can get covered within minutes with NEXT and instantly access your certificate of insurance.

What does Workers’ Comp cover?

Workers’ comp can help cover employee medical bills and other related expenses after work-related injuries. 

Workers’ compensation claims can help pay for:

  • Medical expenses
  • Lost wages
  • Retraining 
  • Permanent injury
  • Death benefits
  • Employer liability

Many of the benefits listed above are also available for business owners if they purchase optional business owner’s coverage with their policy.

Does workers’ comp offer coverage for employee lawsuits?

The employer liability coverage offered with workmen compensation insurance can help protect your business from financial losses if an employee sues you for causing a workplace injury or illness.

It can include coverage for several different types of lawsuits, including negligence.

Learn more about what workers’ compensation insurance covers.

What is not covered by Workers’ Comp?

Workers’ compensation benefits provide many important financial protections, but oftentimes it’s not the only type of insurance business owners buy.

Here are some other types of business insurance that might be helpful for your business:

  • General liability can provide coverage for injuries to people who are not employees and damage to property that doesn’t belong to you.

Does Workers’ Comp cover COVID?

In many cases, a workers’ comp policy will not provide coverage if an employee is affected by a COVID-19 infection.

However, those who can confirm they were infected at their workplace, might be eligible for coverage depending on the state where they work and the industry.

Each state has unique workers’ compensation laws. It’s important to review your specific policy and how it applies to where you and your employees work. 

We review workers’ comp claims on a case-by-case basis.

Who needs Workers’ Compensation insurance?

Most businesses with employees need workers’ compensation. It’s required by law in most states, or business owners buy it to avoid potentially large financial losses.

Learn more about the specific workers’ comp needs for different types of businesses:





Do I need Workers’ Comp if I am self-employed?

A common misconception about workers’ comp is that it’s only for a business that has employees.

In fact, optional workers’ comp coverage for self-employed workers, sole proprietors and LLC businesses can provide financial protection and help meet contract requirements with clients.

If you don’t have workers’ comp and you are injured at work, you also might not be covered by your personal health insurance. It’s important to read your policy documents carefully to make sure you are protected.

How much does Workers’ Compensation cost?

Several factors are used to determine the cost of workers’ compensation insurance, including:

  • The number of employees at your business
  • Your payroll
  • Location of your business
  • Your business operations
  • The job functions of your employess
  • Claims history

If you are exposed to more risks, you typically pay more for insurance, regardless if you’re purchasing workers’ comp coverage or another type of business insurance.

That’s why there’s a significant difference between insurance costs for construction businesses and accountants.

Learn more about workers’ compensation costs.

How to get Workers’ Comp insurance

You can get business insurance and purchase coverage in 10 minutes — 100% online with NEXT.

Workers’ compensation is a bit more complicated than other types of business insurance since it is highly regulated by state governments and it requires more information about your business than other policies.

We work hard to simplify the process with a painless and seamless online application.

The first step to getting the insurance coverage you need is starting an instant quote. We’ll ask you some questions about your business so we can customize a policy to meet your needs.

You should be prepared to share details about:

  • The type of work you do
  • Where you do business
  • The type of business you own and how many years you have been in business
  • The number of employees at your business
  • Total payroll
  • The type of work your employees do
  • Your federal employer identification number. You can typically find this on your tax documents, or apply for one online with the IRS.

If you have any questions about the process or your coverage options, our licensed U.S.-based insurance advisors are ready to help.

You can also save time and up to 10% by bundling other types of business insurance with your workers’ compensation policy (Note: Coverage and discount eligibility may vary from state to state).

How to file a Workers’ Comp claim

You can file a claim anytime and from anywhere online or in the NEXT app.

You’ll be asked to share the details of what happened and to provide relevant photos and documentation.

We strive to make claims decisions within 48 hours so you can get back to focusing on your work.

Learn more about the workers' comp claims process at NEXT.

Workers' Compensation FAQ

Learn about workers’ comp insurance with more frequently asked questions about our coverage.

If you don't find the answers you’re looking for, our licensed insurance advisors are standing by to help.

Does Workers’ Compensation cover business interruption?

Worker’s compensation does not cover business interruption.

Business income interruption is a type of property insurance that covers the loss of income that a business suffers after an unexpected event, such as a fire or snow storm. It is included in NEXT’s commercial property coverage.

For example, if a wind storm hits your city and a tree falls on your shop, business interruption insurance can help cover lost income.

Does Workers’ Compensation cover my subcontractors?

Workers’ compensation generally does not cover subcontractors because they are not your employees.

However, in some states for some industries, subcontractors may be classified as your employees if they don't carry their own workers compensation.

In that case, you must report their payroll as your employees.

Workers’ compensation is regulated by each state. Many states have subtle differences in the requirements. It’s important to carefully read your policy documents.

I'm the owner of the company. Am I covered by workers’ compensation if I'm injured on the job?

Injuries to business owners can be covered by optional business owners’ coverage in workers’ comp. 

If you’re the owner of the company and you trip and break your hand at your work site, you could be eligible to get help with your medical bills and lost wages.

Personal health insurance might not cover medical fees for work-related injuries — especially if you’re in the construction industry — so getting workers’ comp for yourself as a business owner offers you an extra layer of protection.

Who is exempt from Workers’ Compensation insurance?

Every state except for Texas requires workers’ comp for employees.

However, each state also typically has a short list for who is exempt from having coverage. It’s important to check the insurance requirements where you work.

Some states don’t make it a requirement for certain types of workers to have workers’ comp, such as:

  • Agricultural employees
  • Domestic workers
  • Real estate employees
  • Coaches for children’s teams

Be sure to check the exemptions in your state before you decide to buy workmen compensation insurance or not.

Do business owners without employees need to buy workers’ compensation?

If you’re a business owner without any employees, you are probably not required by law to have workers’ compensation, particularly if you’re a sole proprietor, partner or LLC member. 

However, that might not be the case for more regulated industries, such as construction.

Even if it’s not legally required, you could still be asked by your clients for proof of insurance.

Having a certificate of insurance for workers’ comp lets clients know you have coverage if you get injured while working for them.

Do contractors need Workers’ Compensation insurance for themselves?

If you’re a sole proprietor or independent contractor without any employees, you usually aren’t required by law to get workers’ comp.

However, the construction industry is often regulated differently and you might be required to have coverage before you take any jobs.

Regardless if it’s required by law, it can be a good idea to have an active workman's comp policy. If you get sick or injured on the job, workers’ comp would help cover medical bills and some of your lost wages.

If you’re a sole proprietor or independent contractor with employees, you’ll probably need to get workers’ compensation for them unless you work in Texas.

Learn more about workers’ compensation for contractors.

What’s the difference between Workers’ Compensation and disability insurance?

Workers’ compensation only provides financial help for injuries that happen at work.

Disability insurance covers injuries that happen outside of work and is divided into short-term and long-term disability.

It is the employer’s responsibility to pay for workers’ compensation insurance, and it’s usually required by law.

Disability insurance is typically optional and costs are often shared between the employer and employee.

Learn more about the differences between workers’ compensation and disability insurance.

Does workers’ compensation pay disability benefits?

Workers’ comp benefits are separate and distinct from disability benefits.

If a work injury results in a permanent injury that renders you unable to return to work, workers’ comp may pay some kind of permanent injury benefits, but it varies from state to state.

You’ll need a workers’ compensation doctor to verify that your disability was caused by your work conditions, and that your disability is not going to improve. This is called “maximum medical improvement,” or MMI.

If an employee injures their after lifting too many heavy boxes at your moving company and can’t work anymore, a doctor will rate the disability (stated as a percentage) and determine the degree of permanent limitation.

Permanent total disability means you can’t return to work at all in any field.

Permanent partial disability refers to a lasting impairment that sticks around after the initial injury or illness, such as hearing loss. These types of cases are common workers’ comp injuries.

How is workers’ compensation different from health insurance?

Workers’ compensation can cover medical expenses and lost wages after an accident at the workplace.

Health insurance covers personal injuries and ailments that happen outside of work.

Health insurance will cover many of your medical expenses, but it won’t cover any lost wages while you’re recovering after a workplace injury.

Learn more about the differences between workers’ comp and health insurance.

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