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What does it cost me?

How much does workers' comp cost?

Workers' comp is priced per $100 of payroll, so there is no single price. Oregon's Department of Consumer and Business Services found a national median index rate of $1.09 per $100 of payroll for rates in effect through January 1, 2024, from $0.50 in North Dakota to $2.52 in Hawaii; Utah was $0.63. Your own rate depends on each worker's class code, your experience mod, your carrier, and a minimum premium.

Updated September 29, 2026. Written by Andre Beukers, principal at Redoubt, a commercial insurance agency in Salt Lake City, not a government office.

What is the formula to calculate workers' comp premiums?

Every class code carries a rate, and the rate is applied to each $100 of payroll in that class. NCCI, the rating bureau for most states, says in its ABCs of Experience Rating: "Each $100 of payroll is multiplied by the rate to arrive at the premium for each classification." The class premiums are added, then your experience mod is applied.

NCCI's worked example: $70,000 of clerical payroll at $0.75 per $100 is $525; $200,000 of roofing payroll at $63.171 per $100 is $126,342. With a 1.25 mod, the $126,867 total becomes $158,584. Those are NCCI's illustration rates, not a quote for any state.

In Utah and many other states NCCI files loss costs, the part of the rate that pays claims, and each carrier multiplies them by its own loss cost multiplier for expenses and profit. That is why two carriers price the same payroll differently. NCCI Basic Manual Rule 3-A describes a flat expense constant applied to every policy regardless of premium size (with exceptions in some states) and a premium discount above a size threshold.

Why is my rate so much higher than the state average?

Because the state figure blends many trades. Oregon's index weights 53 NCCI class codes by Oregon's payroll, and the study itself warns that "the premium rate listed for a class will often differ from the rate that an individual employer would pay." In NCCI's example above, the roofing rate is more than 80 times the clerical rate.

So your cost starts with the class code on each worker and how payroll is split between codes. A field employee coded as clerical changes the bill when the auditor moves them.

How does my experience mod change what I pay?

The mod compares your own payroll and claims, usually the latest three years available, with businesses in the same classes. NCCI calls a mod below 1.00 a credit and a mod above 1.00 a debit, and it multiplies your premium directly: in NCCI's example, $100,000 of premium becomes $75,000 at a 0.75 mod and $125,000 at 1.25.

Not every business has a mod. Eligibility is a premium threshold "established and approved on a state-by-state basis," and a new business or one under the threshold rates at 1.00. NCCI's plan is not used in California, Delaware, Michigan, New Jersey, New York, Pennsylvania, or the four monopolistic states, which run their own rating plans.

What is the minimum premium, and why do I owe it with no payroll?

NCCI's Basic Manual defines minimum premium as "the lowest policy premium that is required in order to provide insurance under the Standard Policy." Each class code has one, and on a policy with several codes the highest applies. In competitive-rating states the carrier files its own minimums, so the amount varies by carrier, state, and class.

A credit mod does not reduce the minimum, and the minimum already includes the expense constant. If the payroll found at audit produces less premium than the minimum, the minimum is charged. That is why an owner with no employees who buys a policy to produce a certificate pays a flat amount.

What does workers' comp cost in Utah?

Less than in most states. In Oregon's 2024 study Utah's index rate was $0.63 per $100 of payroll, 57 percent of the national median and 48th of 51; only West Virginia, Arkansas, and North Dakota came in lower.

NCCI has proposed lower Utah loss costs two years running: a 4.5 percent decrease for February 1, 2026 and, on August 25, 2026, a 5.6 percent decrease for February 1, 2027. Your carrier's multiplier, class codes, and mod still decide how much of any decrease reaches your bill.

Side by side

What states have the lowest and highest workers' comp costs?

Oregon's Department of Consumer and Business Services ranks all 51 jurisdictions every two years on the same mix of 53 class codes. These are index rates per $100 of payroll for rates in effect through January 1, 2024, ranked from highest (1) to lowest (51). They are not the rate any one employer pays: the study leaves out experience mods, schedule rating, premium discounts, and dividends.

State (2024 rank)	Index rate per $100 of payroll	Percent of national median ($1.09)
1. Hawaii	$2.52	231%
2. New Jersey	$2.16	198%
3. New York	$1.98	182%
4. California	$1.86	170%
5. Vermont	$1.60	147%
6. Connecticut	$1.48	135%
7. Wisconsin	$1.42	130%
8. Wyoming	$1.41	130%
9. Louisiana	$1.41	129%
10. Rhode Island	$1.38	127%
11. Maine	$1.37	125%
12. Washington	$1.35	123%
13. Illinois	$1.34	123%
14. Montana	$1.34	122%
15. Oklahoma	$1.33	122%
16. Missouri	$1.31	120%
17. Minnesota	$1.25	114%
18. New Hampshire	$1.22	112%
19. Iowa	$1.21	110%
20. Alaska	$1.16	106%
21. Pennsylvania	$1.14	105%
22. South Dakota	$1.13	103%
23. Nebraska	$1.12	103%
24. Alabama	$1.11	101%
25. Idaho	$1.10	101%
26. Georgia	$1.09	100%
27. New Mexico	$1.05	96%
28. Colorado	$1.05	96%
29. South Carolina	$1.03	94%
30. Florida	$1.00	92%
31. Massachusetts	$0.97	89%
32. Delaware	$0.97	89%
33. North Carolina	$0.95	87%
34. Mississippi	$0.94	86%
35. Kansas	$0.91	83%
36. Michigan	$0.90	82%
37. Maryland	$0.89	82%
38. Oregon	$0.89	82%
39. Tennessee	$0.80	73%
40. Texas	$0.78	72%
41. Kentucky	$0.76	70%
42. Nevada	$0.73	67%
43. District of Columbia	$0.73	67%
44. Virginia	$0.73	67%
45. Indiana	$0.71	65%
46. Arizona	$0.70	64%
47. Ohio	$0.68	63%
48. Utah	$0.63	57%
49. West Virginia	$0.54	49%
50. Arkansas	$0.53	48%
51. North Dakota	$0.50	45%

Source: Oregon DCBS, Workers' Compensation Premium Rate Ranking, Calendar Year 2024 (published June 2025), Table 1. North Dakota, Ohio, Washington, and Wyoming are monopolistic state-fund states. The 2026 edition had not been published as of September 2026.

Sources

Where these answers come from

Statutes, state agencies, and rating bureaus. Requirements depend on the business, the worker setup, and the current instructions of the state agency, so check the source for your state before acting.

Oregon DCBS, Workers' Compensation Premium Rate Ranking, Calendar Year 2024Published June 2025. National median $1.09 per $100 of payroll; Table 1 ranks all 51 jurisdictions.Oregon DCBS, Workers' compensation premium rate ranking by stateThe study's landing page, with the 2024 and 2022 rankings.NCCI, ABCs of Experience RatingRate per $100 of payroll, the worked premium example, mod eligibility, and credit and debit mods.NCCI Basic Manual, Rule 3-A (revision effective January 1, 2013)Revision dated 2013-01-01. Minimum premium, expense constant (with state exceptions), and premium discount definitions.NCCI, Data Reporting GlossaryDefinitions of loss cost and audited exposure.NCCI, Utah loss cost filing summary, effective February 1, 2027Proposed 5.6 percent decrease, submitted to the Utah Insurance Department August 25, 2026.NCCI, Utah loss cost filing summary, effective February 1, 2026Proposed 4.5 percent decrease for the voluntary market.

The next question

Workers’ compensation insurance: every question, every stateThe hub: the 51-state requirement table and the nine buyer questions.What is a workers' comp class code?How codes are assigned, and the errors that cost money.Why did my workers' comp audit raise the bill?What the payroll audit checks and how to dispute it.What is a ghost policy, and is it enough?The minimum-premium policy owners buy for a certificate.Which states make you buy from the state fund?North Dakota, Ohio, Washington, and Wyoming set their own rates.Utah workers' compensation requirementsWho must carry it in Utah, exemptions, and penalties.My class code is wrong on my auditWhat to send when the auditor moved payroll into a costlier code.

By state

Workers’ comp requirements in every state

Each state page gives the employee threshold, the owner and officer exemptions, the penalty for going without, the rating bureau, the market, the enforcing agency, and the exemption filing, each with its statute or agency source.

Frequently asked questions

Cost FAQ

How much does workers' comp cost per employee?+

There is no fixed per-employee price, because premium follows payroll and class code, not head count. Divide each employee's pay by 100 and multiply by that class's rate. At the 2024 national median index rate of $1.09, $50,000 of payroll comes to about $545 as an index figure, before your class, mod, and carrier pricing; higher-risk codes run well above the median and clerical codes well below.

Does a credit mod lower the minimum premium?+

No. NCCI's Basic Manual says minimum premium is not subject to an experience rating modification, so a credit mod does not reduce a policy that is already at the minimum.

Why was my final bill different from the quote?+

The policy is priced on estimated payroll. After the term the carrier audits your payroll records, and NCCI defines audited exposure as the actual payroll "used to charge the final premium amount." More payroll, or payroll moved into a higher-rated code, means an additional bill.

How current are the state rankings?+

Oregon DCBS publishes the ranking every two years. The latest edition covers rates in effect through January 1, 2024 and was published in June 2025. Rates have been refiled since, including Utah's loss costs in 2025 and 2026, so use it to compare states, not as a current quote.

Talk to Redoubt

Get your rate per $100, not an average

Text Redoubt what the business does, payroll by job type, and the state the work is in, plus your current policy or mod worksheet if you have one. We will show how your premium is built and which parts can move.

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This is general insurance information, not legal advice or a coverage determination. Statutes, agency instructions, policy forms, and the facts of the business control.