Does Delaware require workers’ compensation insurance?
Yes. Delaware requires workers' compensation from the first employee: 19 Del. C. § 2306 applies the Workers' Compensation Act to any employment with one or more employees. Sole proprietors and partners are outside the Act unless they elect coverage. Corporate officers and LLC members are covered by default, but up to eight can sign an exclusion agreement. Construction is stricter: a sole proprietor subcontracting for a licensed contractor must be covered.
Updated . Written by Andre Beukers, principal at Redoubt, a commercial insurance agency in Salt Lake City, not a government office.
How many employees before Delaware requires workers' comp?
Under 19 Del. C. § 2306 the Act applies to any employment with one or more employees, so the first hire, full-time or part-time, triggers the requirement. Household workers paid less than $750 in cash in a three-month period by one household, and farm laborers whose employer does not choose to insure them, are outside the Act under § 2307.
Out-of-state employers are covered too. Under 19 Del. C. § 2371, an employer based elsewhere needs Delaware coverage for any employee doing substantial work here: licensed-contractor construction work, more than five consecutive workdays at a time, or more than three weeks in any six months. The Office of Workers' Compensation's enforcement page says Delaware must be listed in Section 3A of the policy; "all other states" coverage does not count.
Source: 19 Del. C. §§ 2306 and 2307, checked .
Which owners, officers, and family members are exempt in Delaware?
Sole proprietors and partners are not covered unless they elect coverage. Executive officers and LLC members are covered by default, but as many as eight officers who own stock in the corporation, or eight LLC members, can be exempted if the business and each of them agree in writing (19 Del. C. § 2308). Immediate family members of a sole proprietor or partner are covered unless each one agrees in writing to an exemption.
Construction is the exception. Under 19 Del. C. § 2311(a), a sole proprietor or partner working as an independent contractor for a licensed contractor must be covered, by their own policy or the hiring contractor's, and a construction corporation can exclude no more than four officers. The hiring contractor must keep each sub's certificate of insurance or exemption notice for three years, or it insures the sub's claims itself.
Source: 19 Del. C. § 2308, checked .
What happens to a Delaware employer with no workers' comp?
An uninsured Delaware employer owes a civil penalty of three times a year's premium, at its last carrier's rate or, if it was never insured, the most expensive rate any Delaware carrier charged for that business (19 Del. C. § 2374). Staying uninsured after Department of Labor notice adds $10 per employee per day, at least $250 a day. After 30 days the Department can ask the Court of Chancery to stop the business, and an injured worker can sue without the employer's usual defenses.
Source: 19 Del. C. § 2374, checked .
Who enforces workers' comp in Delaware?
The Office of Workers' Compensation, in the Department of Labor's Division of Industrial Affairs, enforces the requirement and runs an employer look-up that confirms current coverage. Under 19 Del. C. § 2374, a carrier reports a canceled or lapsed policy to the Department within 14 days, and the employer then has 14 days to show proof of coverage or a reason it needs none.
The Office of Workers' Compensation's enforcement page adds that it does not accept a certificate of liability insurance as proof of coverage; it asks for the policy declarations page or the full policy.
Source: Delaware Office of Workers' Compensation, checked .
Where do Delaware employers buy coverage?
Delaware is a private-market state: an employer insures with a carrier approved by the Department of Labor and authorized to write workers' compensation in Delaware, or proves it can self-insure (19 Del. C. § 2372). An employer no voluntary carrier will write goes to the residual market, the Delaware Workers Compensation Insurance Plan, which DCRB administers. DCRB does not underwrite policies or set premiums.
Source: DCRB, Residual Market, checked .
Who sets the class codes and rates in Delaware?
Delaware is not an NCCI state. The Delaware Compensation Rating Bureau (DCRB), an independent bureau headquartered in Philadelphia, runs the classification system, experience modifications, and rating values Delaware carriers use, and every insurer writing Delaware workers' compensation must be a DCRB member. Delaware class codes and experience mods come from DCRB, not NCCI.
Source: Delaware Compensation Rating Bureau, About Us, checked .
Is there an exemption or waiver form in Delaware?
Yes, for corporate officers and LLC members, and it goes to the carrier, not the state: DCRB's Form DE-EXCL, the Executive Officers/LLC Exclusion Agreement. An insured business sends the signed original to its carrier with the shareholder or operating-agreement documents and redoes it when an officer's status or the carrier changes; a subcontractor also gives a copy to each general contractor. Sole proprietors and partners outside construction need no form, since they are not covered unless they elect it.
With no policy in force, check with the Office of Workers' Compensation on whether it wants a copy; the statute only requires the written agreement.
Source: DCRB, Forms (DE-EXCL), checked .
Sorting out Delaware workers' comp for your business
Tell Redoubt what the business does, who works in it, and what the Delaware requirement in front of you says. We will say whether a policy, a waiver, or an exclusion fits.
This is general insurance information, not legal advice or a coverage determination. Statutes, agency instructions, policy forms, and the facts of the business control.
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.
- Alabama
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- Delaware
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The hub, and the Delaware pages that go deeper
Delaware workers’ comp FAQ
Do I need workers' comp in Delaware with only one employee?+
Yes. 19 Del. C. § 2306 applies the Act to any employment with one or more employees, part-time included. The only carve-outs are small household jobs paid under $750 in cash a quarter and farm laborers whose employer does not choose to insure them.
Is a Delaware LLC owner covered by workers' comp automatically?+
Yes. Unlike sole proprietors and partners, LLC members are covered by default in Delaware. Up to eight members can opt out by signing DCRB's DE-EXCL agreement with the LLC and, if the LLC has a policy, sending it to the carrier.
Does a sole proprietor subcontractor in Delaware construction need workers' comp?+
Yes. Under 19 Del. C. § 2311(a), an independent contractor working for a licensed contractor must be covered, by their own policy or the hiring contractor's, and a sole proprietor or partner in that role cannot use the owner exemption.