Workers Compensation Insurance is mandatory in most states (except Texas). You know you need it, what’s the fastest and least painful way of getting a quote? Do rates vary among different companies? Does it pay to shop around?
- Which information do you need to get workers compensation insurance quotes online?
- The states where you can get free workers comp insurance quotes online and where you can’t
- Where to get free workers comp insurance quotes online?
- How to calculate the premiums of workers comp insurance?
- Compare several free workers comp insurance quotes online
- How to find cheap workers comp insurance online?
- Where to find workers comp insurance in different states?
Which information do you need to get workers compensation insurance quotes online?
No matter where you get a quote, you’ll need some basic information about your small business first. Typically, you’ll be asked for:
- What industry you work in
- The number and the types of employees you have
- Total amount of payroll for EACH type of employee you have
- Claims history (have you ever filed a workers’ comp claim before?)
- Federal Employer identification number (EIN) or your social security number (optional) – most online quote providers do not require this to get a quote; but they do require this before you can buy the policy online
The states where you can get free workers comp insurance quotes online and where you can’t
Workers’ compensation rates vary from state to state. Some even dictate where you can buy workers’ compensation insurance, and some insist you have to buy it from the state fund. Those are called monopolistic states, and they are:
- North Dakota
If you live in one of these states, you can’t get an online quote: you have to get your insurance through the state, and you have no other option.
Other states offer a state fund as an option. In these states, you can get workers comp insurance quotes online from both the state fund and private insurance companies. Competitive state fund states are:
- New Mexico
- New York
- Rhode Island
State Funds keep workers’ compensation rates from rising to astronomical levels. They also serve to provide insurance to businesses that might have difficulty finding private insurance, such as those in risky industries like roofing or handyman or trucking or businesses that’ve had a workers’ compensation claim.
And finally, if you are in the states which do not appear in the two lists above, you can get free workers comp insurance quotes online from insurance companies or digital brokers.
Where to get free workers comp insurance quotes online?
Getting workers comp insurance quotes online through digital brokers
If you live in a state that allows you to get quotes from companies other than the state, you have three options: digital brokers or traditional insurance companies or insuretech startups:
Digital brokers include:
- CoverWallet – see our review of CoverWallet
- Huckleberry – see our review of Huckleberry
- Nationwide – for workers comp insurance, Nationwide can provide several quotes as a broker, they do not provide workers comp insurance as a carrier
Getting workers comp insurance quotes online through traditional insurance companies
Many traditional insurance companies sell workers comp insurance across the country. However, only a few offer quotes online. In our experience, we could get quotes online from three companies only: Hiscox, Liberty Mutual, and the Hartford.
- The Hartford – see our review of the Hartford
- Hiscox – see our review of Hiscox
- Liberty Mutual – see our review of the Liberty Mutual
- Chubb – see our review of Chubb small business insurance
- Nationwide – see our review of Nationwide small business insurance
- Travelers – see our review of Travelers small business insurance
Getting free workers comp insurance quotes from insuretech startups
There are also digital insurance companies that are entirely online, like Pie, Certify, and Foresight. They are also called insuretech startups.
While Pie and Cerity sell workers comp insurance to most small businesses, except the risky ones like construction companies, Foresight is focused exclusively on selling workers comp insurance to construction companies. See our review of Pie workers comp insurance and Foresight workers comp insurance.
How to calculate the premiums of workers comp insurance?
Workers Compensation has a formula that you can use to get an estimate of what you’ll pay. The formula is:
(Annual employee payroll/100) x Class Code Rate x Experience modification rate = premium
States can use different class codes: most use the National Council for Compensation Insurance and some states use their own. If we take California as an example, you can find a class codes list here.
As far as payroll goes, California pays $1.41 per $100 of payroll (down $.05 from 2020).
The experience modification rate is really the only thing that should differ among insurance companies as far as quotes go. EMR rates vary from .075-1.25. If your EMR is above 1.0 your workers’ compensation rates will be higher and if they are less than 1.0 they’ll be lower. If you are a brand new business without any history, you’ll probably start at 1.0. If you have a workers comp claim, your rates will go up.
With a standard formula, you’d expect that all companies should give you similar quotes, maybe just a bit difference in fees. However, our experience of getting several quotes from these companies suggest that they are vastly different. Be sure to shop around with a few companies to compare several quotes, if you can, before making the final purchase decision.
Compare several free workers comp insurance quotes online
To illustrate that the quotes are vastly different from different providers, we got 4 quotes from the 3 brokers, CoverWallet, Huckleberry, and Nationwide, and one insuretech provider Certify for the same company: a cleaning company located in Wisconsin with 4 full time employees and an annual payroll of $250K and $500K in annual revenue.
Below are the four quotes from the 4 companies:
Free online workers comp insurance quotes from CoverWallet:
As you can see in in the screenshot above, CoverWallet provided us with 2 quotes: one from Guard and the other from Chubb. Guard quote is a bit cheaper than Chubb’s. However, they are for different coverage limits. The Guard’s quote is for $100K/$100K/$500K coverage limits whereas the one from Chubb is for $500K/$500K/$500K limits.
Free online workers comp insurance quotes from Huckleberry:
Free online workers comp insurance quote from Nationwide (as a broker)
As a broker, Nationwide provided us with 2 workers comp insurance quotes for this cleaning business in Wisconsin: one from Markel and the other from BiBERK. The Markel quotes is almost 40% cheaper than the biBERK’s quote.
Free online workers comp insurance quotes from Cerity
As you can see now, different companies will provide you with different quotes and they are significant different in premiums. Be sure to shop around with a few companies to compare several quotes. Shopping with a digital broker is a convenient way to get several quotes at once.
How to find cheap workers comp insurance online?
First and foremost, shop with a few companies or a digital broker to compare several quotes is the only sure way to find the cheapest workers comp insurance for your business.
There are a few other things you can do to save yourself money on workers’ compensation insurance.
- First, not only should you have a written safety plan, but ideally it should be posted so everyone can see it. You should also have an orientation program for new hires (labor department data shows that many injuries happen in the first three months of work).
- Make sure you classify your employees correctly and make sure your insurance company does as well.
- Finally, you can try pay-as-you-go workers’ compensation insurance. As opposed to estimated annual payroll, pay-as-you-go uses your actual payroll to calculate rates. This can save you money by calculating rates on the employees you actually have, as opposed to employees who have left.
Where to find workers comp insurance in different states?
As in other types of business insurance, workers comp insurance has nuances and differences in different states. The best providers may also be different in different states. Below are our guides to find the best workers comp insurance providers in several states:
- California – The best workers comp insurance companies in California
- Florida – The best workers comp insurance companies in Florida
- Texas – The best workers comp insurance companies in Texas
- New York – The best workers comp insurance companies in New York
- New Jersey – The best workers comp insurance companies in New Jersey
- Pennsylvania – The best workers comp insurance companies in Pennsylvania
- Colorado – The best workers comp insurance companies in Colorado
- Georgia – The best workers comp insurance companies in Georgia
- Massachusetts – The best workers comp insurance companies in Massachusetts
- Illinois – The best workers comp insurance companies in Illinois
- Arizona – The best workers comp insurance companies in Arizona
- Michigan – The best workers comp insurance in Michigan
- Ohio – The best workers comp insurance in Ohio
- North Carolina – The best workers comp insurance in North Carolina
- Maryland – The best workers comp insurance in Maryland
- Oregon – The best workers comp insurance in Oregon
- Minnesota – The best workers comp insurance in Minnesota
- Wisconsin – The best workers comp insurance in Wisconsin
- Tennessee – The best workers comp insurance in Tennessee
Workers’ compensation insurance is necessary, as it’s required and there are steep fines if you try to go without it. If you have clear-cut business, you can get quotes online. In addition to price, compare coverage limits, financial strength and customer service before choosing a company.