Massachusetts Workers’ Compensation Insurance

Jump ahead to learn:

• Is Massachusetts Workers’ Compensation insurance required?
• What could the Commonwealth of Massachusetts Workers’ Compensation coverage include?
• How does Workers’ Compensation insurance in Massachusetts work?
• Workers’ Comp Massachusetts exemptions: Who qualifies?
• How much does Workers’ Comp insurance in Massachusetts cost?
• How ERGO NEXT can help protect Massachusetts business owners

Is Massachusetts Workers’ Compensation insurance required?

Yes, workers’ compensation insurance is required for most employers in Massachusetts, regardless of their number of employees or how many hours they work, according to Massachusetts state law. There’s no minimum headcount, no payroll threshold and no waiting period. Massachusetts has one of the strictest workers’ comp requirements in the country.

In addition to state law requirements, proof of Massachusetts workers’ comp is often required in many professions before they can get a business or contractor license. And coverage could also be required before a business can bid on or perform public contracts.

There is one limited exception to the rule: Domestic workers (household employees) must work at least 16 hours per week to require workers’ comp coverage. Everyone else — full-time, part-time, seasonal and even family members on payroll — must be covered by workers’ comp insurance.

According to the U.S. Bureau of Labor Statistics, private industry employers reported approximately 2.5 million nonfatal workplace injuries and illnesses nationwide in 2024. For Massachusetts small business owners, coverage isn’t just a legal obligation — it can also be a financial safeguard if something goes wrong on the job.

What could the commonwealth of Massachusetts Workers’ Compensation coverage include?

Workers’ comp could help pay for costs related to work-related injuries or illnesses for employees. And if business owners add optional coverage for themselves, they, too, could be covered by workers’ comp protections. Even if you have health insurance, workers’ comp could help protect you from work-related illnesses and injuries, and it could help protect your wages if you’re unable to work while in recovery.

If a business owner or an employee is injured on the job, a Massachusetts workers’ comp policy could help cover costs for:

• Emergency treatment and all necessary medical expenses — without copays or deductibles.
• Lost wages (income benefits).
• Death and survivor benefits.
• Vocational retraining if the injured employee can no longer do their job.
• Permanent injury or disability benefits.
• Scarring, disfigurement or permanent loss of function.

If you run a small plumbing company in Boston and one of your employees hurts their back and they can’t work for several weeks, workers’ compensation could help pay for their diagnosis, physical therapy and lost wages while they recover — up to the policy limits.**

Workers’ compensation doesn’t usually cover incidents that aren’t job-related, or situations involving intentional self-injury, employee misconduct or impairment from drugs or alcohol.

How does Workers’ Compensation insurance in Massachusetts work?

If there’s a work-related injury or illness, Massachusetts workers’ comp provides a structured process to help employees get the care and benefits they need. The Massachusetts Department of Industrial Accidents (DIA) administers the system.

Here’s how the process works:

1. Report the injury. The employee should report the injury to their employer as soon as practicable. The employer must then report it to their insurance carrier, which will begin the claims process. If an employee experiences a work-related accident or illness that results in at least five days of lost work time, employers must also file a First Report of Injury with the DIA within seven days of that lost time.
2. Get medical care. Employees can see a health care provider of the employer’s or insurer’s choosing for the first visit. After that, they have the right to choose their own care providers.
3. The insurer reviews the claim. The workers’ comp carrier reviews the claim. The first 180 days after a claim is filed are considered a Pay-Without-Prejudice period — meaning that during this time, the insurer may pay benefits without making a final determination on whether the injury is covered. This protects employees while the claim is being evaluated.
4. Benefits are paid. If the claim is accepted, the insurer coordinates payment for authorized medical treatment — as well as lost wage benefits beginning on the sixth day of disability.
5. The employee returns to work or receives ongoing benefits. Once medically cleared, the employee returns to their role. If the injury results in a permanent impairment or prevents the employee from returning to any type of work, permanent disability benefits — including an annual cost-of-living adjustment — may apply.

Massachusetts workers’ comp operates under an exclusive remedy rule. This means that when an employee receives workers’ comp benefits, they generally waive the right to sue their employer for negligence related to that injury. This can be an important legal protection for some business owners.

Workers’ Comp Massachusetts exemptions: Who qualifies?

Massachusetts has a nearly universal coverage requirement, but a limited set of exemptions do apply for this type of business insurance, including:

• Sole proprietors, LLC members and LLP partners aren’t required to carry workers’ comp insurance for themselves. This exemption applies only to the business owner. Employees who aren’t members of the LLC or LLP must still be covered.
• Corporate officers who own at least 25% of the issued and outstanding stock of the corporation can request an exemption from coverage for themselves. The exemption applies only to the officer and not to the company’s employees.
• Domestic workers (household employees) are exempt unless they work at least 16 hours per week for the same employer.

Additional limited exemptions include:

• Seamen engaged in interstate or foreign commerce.
• Real estate and consumer goods salespeople who have a written contract stating they’re not treated as employees under federal tax law.
• Taxi drivers who lease their cabs and aren’t treated as employees under federal tax law.
• Workers engaged in interstate or foreign commerce who are covered by a federal compensation statute for injury or death.

Important: Even if an owner is exempt from coverage for themselves, their obligation to cover all employees remains.

Some larger employers may also qualify to self-insure, but eligibility is strict — generally requiring at least 300 employees and a minimum of $750,000 in annual standard premium, subject to DIA approval.

How much does Workers’ Comp insurance in Massachusetts cost?

Workers’ comp insurance costs in Massachusetts vary across industries and businesses.

Some factors that could influence your business’ monthly premium for workers’ comp in Massachusetts include:

• Your total payroll.
• The type of work your employees do and their assigned WCRIBMA class codes.
• Your number of employees.
• Your insurance claims history and workplace safety record.
• The locations in Massachusetts where your employees work.

Massachusetts uses its own independent class code system administered by the Workers’ Compensation Rating and Inspection Bureau of Massachusetts (WCRIBMA), rather than the national NCCI system. This means that the class codes that apply to your employees — and how they affect your rate — may differ from other states.

The best way to see the exact price of coverage for your business is to get a free quote from ERGO NEXT.

How ERGO NEXT can help protect Massachusetts business owners

ERGO NEXT has workers’ comp insurance that’s fast and flexible — and you can buy it 100% online in about 10 minutes.

Get unlimited certificates of insurance at no extra cost, and manage your policy 24/7 via web or mobile app.

If you have questions, our licensed, U.S.-based insurance professionals are available to help.

Start a free quote with ERGO NEXT.

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