Does Iowa require workers’ compensation insurance?
Yes. Iowa requires workers' compensation from the first employee: Iowa Code 85.3 says every employer not specifically excepted must secure compensation, with no minimum head count. The main exceptions are household and casual workers paid under $1,500 a year, farms with under $2,500 of non-family cash payroll, and owners. Proprietors, partners, and LLC members are not covered unless they buy coverage, and up to four corporate officers can reject it in writing.
Updated . Written by Andre Beukers, principal at Redoubt, a commercial insurance agency in Salt Lake City, not a government office.
How many employees before Iowa requires workers' comp?
Iowa has no employee floor. Every employer the chapter does not specifically except must provide and pay compensation for work injuries, and a nonresident employer whose employees work in Iowa is treated as doing business in the state and falls under the same rules. One part-time employee is enough to need a policy.
Trucking has one carve-out. A motor carrier does not have to insure an owner-operator who qualifies as an independent contractor under Iowa Code 85.61, but under 87.1 it must require that owner-operator to keep a certificate of workers' comp covering the owner-operator's own employees.
Source: Iowa Code 85.3, checked .
Which owners, officers, and family members are exempt in Iowa?
Iowa Code 85.1 lists who is outside the Act. A household worker, or a casual worker whose job is not part of your trade, is exempt until they earn $1,500 or more from you in 12 months. A farm is exempt until its cash payroll to non-family workers reaches $2,500 in the prior calendar year, and relatives employed in the farm operation stay exempt. The president, vice president, secretary, and treasurer of a corporation, up to four officers and not in a family farm corporation, can reject coverage in writing. Under 85.1A, proprietors, partners, and LLC members are covered only if they buy a policy that names them.
Source: Iowa Code 85.1, checked .
What happens to a Iowa employer with no workers' comp?
An Iowa employer may not do business without insurance or approved self-insurance, and doing so willfully and knowingly is a class D felony under Iowa Code 87.14A. When the Workers' Compensation Commissioner learns of an uninsured employer, it sends notice by certified mail; after 15 days the Attorney General can ask a court to enjoin the business (87.19). An injured employee can also sue the employer directly, with negligence presumed and the usual common-law defenses gone (87.21).
Source: Iowa Code 87.14A, checked .
Who enforces workers' comp in Iowa?
The Workers' Compensation Division of the Iowa Department of Inspections, Appeals, and Licensing (DIAL) administers the system under the Workers' Compensation Commissioner. It decides disputes, takes the owner and officer filings below, and uses NCCI's coverage database to verify whether an employer is insured. It does not give legal advice or pay benefits. Older pages may still name Iowa Workforce Development; the Division now sits within DIAL.
Source: Iowa DIAL, Workers' Compensation, checked .
Where do Iowa employers buy coverage?
Iowa employers buy from private carriers approved by the Commissioner of Insurance (Iowa Code 87.1), or apply to the Commissioner to self-insure by proving financial ability to pay (87.11). The Iowa Insurance Division regulates carrier rates and forms and has authority over employer disputes about rate increases and audits. An employer no voluntary carrier will write goes to the residual market, the Assigned Risk Plan.
Source: Iowa Insurance Division, Other Types of Insurance, checked .
Who sets the class codes and rates in Iowa?
Iowa is an NCCI state. NCCI is the licensed rating organization that files voluntary and assigned risk rates with the Iowa Insurance Division for member carriers, and it assigns class codes and experience mods. Its 2026 Iowa State Advisory Report, posted August 20, 2026, proposes a 2.1% decrease for both markets for policies effective January 1, 2027, pending the Division's review. Your premium still depends on your class codes, payroll, and mod.
Source: NCCI, State Advisory Resources: Iowa, checked .
Is there an exemption or waiver form in Iowa?
Yes, two. A proprietor, LLC member, limited liability partner, or partner files a Nonelection of Coverage; up to four corporate officers file a Rejection of Coverage (Iowa Code 87.22). If the business has a policy, the signed form is attached to the policy. If it has none, the form is filed online with the Workers' Compensation Division and signed in front of two witnesses with no tie to the business. The Division posts a public list of filings made since November 1, 2019.
A nonelection or rejection covers only the person who signs it, and a filing required as a condition of employment is not enforceable. It says nothing about employees: the day the business hires, a policy is due. A general contractor may still ask for a certificate of insurance rather than a copy of the filing.
Source: Iowa DIAL, Nonelection of Coverage, checked .
Sorting out Iowa workers' comp for your business
Tell Redoubt what the business does, who works in it, and what the Iowa 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
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- District of Columbia
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- West Virginia
- Wisconsin
- Wyoming
The hub, and the Iowa pages that go deeper
Iowa workers’ comp FAQ
Do I need workers' comp in Iowa with only one employee?+
Yes. Iowa Code 85.3 requires every employer not specifically excepted to secure compensation, and there is no head-count minimum. The exceptions turn on the kind of work, household, casual, or farm labor under the dollar limits in 85.1, not on how many people you employ.
Does an Iowa LLC owner with no employees need workers' comp?+
No. Under Iowa Code 85.1A an LLC member is covered only by buying a policy that names them. Iowa Code 87.22 has an owner who does not elect coverage sign a Nonelection of Coverage, filed online with the Workers' Compensation Division when there is no policy, which also gives you a record to show a customer.
Are 1099 independent contractors covered in Iowa?+
Not if they really are independent contractors. The Workers' Compensation Division says the label on a contract does not decide it; a worker who functions like an employee is treated as one, case by case. If that happens, their pay belongs on your policy and your audit.
How do I check whether an Iowa subcontractor has workers' comp?+
The Workers' Compensation Division points to NCCI's employer coverage verification database, which is built from the Division's data. The Division notes it can lag behind reporting, so ask the subcontractor for a current certificate of insurance as well.