How Much Is Workers' Comp Insurance? (2026 Cost Breakdown)

Workers’ comp is priced per $100 of payroll, so two businesses with the same headcount can pay wildly different amounts. An office manager and a roofer aren’t rated anywhere near each other.

Key takeaways

Premium = (payroll ÷ 100) × class rate × experience mod, then discounts, fixed charges and state assessments.
The national median was $1.09 per $100 of payroll in Oregon’s 2024 state-by-state study, from $0.50 in North Dakota to $2.52 in Hawaii [1][2].
Your type of work moves the price most. SAIF’s 2026 Oregon rates run from 4 cents per $100 for clerical work to $12.08 for roofing [4].
You pay on estimated payroll, and an audit after the policy ends trues it up [9][10].

Here’s the formula, piece by piece, with two worked examples on real 2026 workers’ compensation rates.

How much is workers’ comp insurance? The short answer

Here’s the short answer: for most businesses, workers’ comp costs somewhere between a few cents and a few dollars for every $100 of payroll, depending mostly on the work your employees do.

Oregon’s Department of Consumer and Business Services (DCBS) compares states every two years. In its 2024 study, the median state’s index rate was $1.09 per $100 of payroll, the lowest since the study began in 1986 [2]. That’s a weighted benchmark across 53 common job classes, not what any one business pays [2][3].

Single classes vary far more. For rates in effect on January 1, 2024, clerical office work ranged from 4 to 48 cents per $100 across states, while roofing ranged from $1.18 to $28.84 [2].

Publishers that survey quotes put it in per-employee terms:

MoneyGeek estimates $113 per employee per month for businesses with one to four employees, based on its own modeled quote data (updated October 2026) [15].
NerdWallet, citing 2026 data from broker Coverdash, lists median premiums from $1,200 a year for department stores to $12,000 or more for commercial and large residential roofers [14].

Treat those as rough ranges. Your quote depends on your class codes, payroll and state.

How is workers’ comp calculated? The formula

Workers’ comp premium is built in layers. The core is one multiplication [9]:

Manual premium   = (payroll ÷ 100) × class rate
Modified premium = manual premium × experience mod
What you pay     = modified premium − premium discount
                   + fixed charges + state assessments

The names and the exact order vary by state and carrier, so read your own quote line by line.

Payroll: the rating base

Comp is rated per $100 of payroll, class by class [9]. If you pay $300,000 in wages, that’s 3,000 rating units. Washington is the exception: its state fund publishes rates per hour worked [11].

Class rate: loss costs times the carrier’s multiplier

Every employee is assigned a class code for the work they do. A rating bureau estimates the expected claim cost for each class, called the loss cost or pure premium. Insurers then multiply it by a loss cost multiplier to cover their expenses, taxes and profit [2].

That multiplier is why quotes differ. Oregon carrier SAIF applies tiers from 1.130 to 2.100 to the same loss cost in 2026 [5]. Among Oregon’s top 30 insurers, the average multiplier was 1.533 in 2024 [2].

Who sets the base rates depends on your state [2]:

NCCI is the rating organization for 35 states and Washington, D.C.
Independent bureaus set them in California, Delaware, Indiana, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Pennsylvania and Wisconsin.
Monopolistic state funds run the system in North Dakota, Ohio, Washington and Wyoming.

Experience mod: your claims record

An experience mod compares your past claims with what’s expected for businesses of your size and type. A 1.00 mod is average. Colorado carrier Pinnacol Assurance gives the example that a 0.85 mod pays 15% less and a 1.25 mod pays 25% more [8].

The mod usually looks at three years of claims, skipping the most recent policy period because those claims are still developing [8]. Small employers often don’t have one. SAIF’s 2026 memo sets Oregon’s eligibility thresholds at $7,500 of subject premium in the most recent 24 months of the base period and a $3,750 annual average [5].

Premium discount

Larger policies get a volume discount. SAIF’s 2026 schedule gives 0% on premiums up to $5,000, then 10.5%, 16.5% and 18.0% bands above that [5]. Oregon’s assigned-risk plan has had no premium discount since 2011 [5].

Fixed charges and state assessments

States add their own charges to fund their workers’ comp systems. Oregon’s premium assessment is 9.8% in 2026 [7]. Oregon also charges a separate Workers’ Benefit Fund assessment of 1.8 cents per hour worked, of which employers must pay at least 0.9 cents [7].

SAIF adds catastrophe and terrorism charges of 1 cent and half a cent per $100 of payroll. Minimum premiums depend on the class, up to $500 for voluntary policies [5]. In most states, DCBS found taxes and assessments add less than 5% to manual rates [2].

Class codes: the number that moves your price most

Here’s how much five common classes cost in six states. These are DCBS’s calculated manual rates per $100 of payroll, effective as of January 1, 2024, and include each state’s average insurer multiplier and assessments. States that don’t use NCCI codes reported their closest equivalent [2].

Class (NCCI code)	California	Florida	New Jersey	New York	Oregon	Texas
8810 Clerical office	$0.24	$0.13	$0.17	$0.18	$0.06	$0.07
8017 Retail store	$3.05	$1.20	$2.99	$1.55	$0.77	$0.99
9082 Restaurant	$3.11	$1.22	$2.54	$1.81	$0.92	$0.81
5645 Carpentry, low-rise homes	$8.41	$8.24	$25.89	$8.95	$8.83	$6.40
5551 Roofing	$15.68	$3.40	$6.41	$23.22	$10.09	$2.57

Two things stand out. The same job can cost three to four times more across a state line. And the gap between office and trade work dwarfs any state difference.

If your business mixes work, each employee’s payroll goes under the right code. NerdWallet’s example: a Georgia pest control firm’s sprayers rate around $2.82 per $100, while its office staff rate around 8 cents [14]. Lump everyone under the field code and you overpay on the office payroll.

Worked example: a café in Oregon (2026 rates)

Here’s an illustrative café with $300,000 of annual payroll, all under Oregon class 9079 (Restaurant NOC and Drivers) [2]. SAIF’s 2026 loss cost for 9079 is $0.518 per $100. We’ll assume SAIF places the café in tier D (factor 1.505), giving a rate of $0.780 [4][5]. That tier is our assumption; SAIF assigns tiers by underwriting.

Step	Math	Amount
Rating units	$300,000 ÷ 100	3,000
Manual premium	3,000 × $0.780	$2,340.00
Experience mod	Below Oregon’s $3,750 threshold, so 1.00 [5]	$2,340.00
Premium discount	Under $5,000, so 0% [5]	$0.00
Catastrophe charge	3,000 × $0.01 [5]	$30.00
Terrorism charge	3,000 × $0.005 [5]	$15.00
DCBS premium assessment	9.8% × $2,340 [7]	$229.32
Estimated annual cost		$2,614.32

That works out to about 87 cents per $100 of payroll. On top of that, if staff work 15,000 hours, the Workers’ Benefit Fund charge at 1.8 cents an hour is $270, and the employer pays at least $135 [7].

» MORE: Plug in your own rate with our workers’ comp calculator

Worked example: a remodeling contractor with a mod

Now a bigger account. An Oregon remodeler has $250,000 of payroll for carpenters (class 5645) and $50,000 for office staff (class 8810). In SAIF’s tier D, those rates are $7.48 and $0.06 per $100 [4].

Carpenters: 2,500 units × $7.48 = $18,700
Office staff: 500 units × $0.06 = $30
Manual premium: $18,730

The mod makes a big difference at this size:

Experience mod	Modified premium	Change
0.85	$15,920.50	−$2,809.50
1.00	$18,730.00	—
1.15	$21,539.50	+$2,809.50

That’s a $5,619 gap between a clean and a claims-heavy record, on the same payroll.

All three fall in SAIF’s 16.5% premium discount band [5]. SAIF’s memo lists the bands but not how they’re applied. If each percentage applies only to the slice of premium in its band, the 1.15 policy’s discount is about $2,129. If 16.5% applied to the whole premium, it would be $3,554. Ask the carrier which method it uses, then add the 9.8% assessment and the per-$100 charges.

Pro Tip: Estimate each class separately: (class payroll ÷ 100) × rate. Add the classes, multiply by your mod, then add about 10% to 15% for state assessments and charges if you’re in a state like Oregon. That last range is our rough rule, not a filed number.

Workers’ comp rates by state

Oregon’s 2024 study ranks all 50 states and D.C. on the same mix of job classes, so the comparison is apples to apples [1][3].

Rank (2024)	State	Index rate per $100 of payroll
1	Hawaii	$2.52
2	New Jersey	$2.16
3	New York	$1.98
4	California	$1.86
5	Vermont	$1.60
26 (median)	Georgia	$1.09
30	Florida	$1.00
40	Texas	$0.78
49	West Virginia	$0.54
50	Arkansas	$0.53
51	North Dakota	$0.50

Source: Oregon DCBS, rates in effect as of January 1, 2024 [1].

DCBS says its index isn’t meant to match any state’s actual average premium. It also leaves out experience mods, discounts and dividends, since those depend on the employer [3].

Rates also move. Oregon’s average pure premium fell 3.3% for 2026, but DCBS says it will rise 2.1% in 2027 after a law raised injured workers’ benefits [7][6].

Premium audits: why your final bill can change

Your policy is written on estimated payroll. After it ends, the insurer audits your actual payroll and class codes, then bills or refunds the difference [9]. ADP says the audit comes within 30 to 60 days of the policy expiring [10].

Two things commonly cause a bigger bill:

Payroll grew more than you estimated.
Uninsured subcontractors. In Florida, if a subcontractor has no workers’ comp, its workers become the contractor’s employees for injury benefits [12]. MEM, a comp carrier, warns that hiring uninsured subs can raise your premium [9].

That’s why contractors collect a certificate of insurance from every sub before work starts. Clients may ask for your proof of coverage, too, and some contracts require a waiver of subrogation on your comp policy.

Updating your insurer when payroll changes mid-year keeps the audit from becoming a surprise [14].

What our workers’ comp calculator does (and doesn’t)

Our workers’ comp premium calculator runs the core formula on your numbers. You enter three things: annual payroll, your class rate per $100 and your experience mod (1.00 if you don’t have one).

It shows:

Rating units (payroll ÷ 100)
Manual premium (units × rate)
Modified premium (× mod), and how many dollars the mod adds or saves
Your premium as a share of payroll

It doesn’t include a rate table. Rates are filed by state and class and change every year, so you bring the rate from your quote, policy or rating bureau. It also leaves out premium discounts, fixed charges, state assessments, minimum premiums and the audit. If you have more than one class, run each class separately and add them up.

For a quick look at the other policies a small business usually weighs, try the business insurance calculator.

How to lower your workers’ comp cost

You can’t change your state’s rates, but you control more than you might think:

Check every class code. Office staff rated under a field code pay field rates [14].
Split payroll correctly. Keep records that show which employees did which work.
Prevent claims and manage the ones you have. Fewer claims bring your mod down over time [8][9].
Bring injured workers back safely. NerdWallet suggests helping injured employees return to work to avoid prolonged claims [14].
Ask about pay-as-you-go billing. Some insurers let you pay as you run payroll instead of estimating the year up front [14].
Shop the multiplier. SAIF’s top tier is 86% above its lowest on the same loss cost (2.100 vs. 1.130) [5]. Other carriers price differently, too.

Bring your declarations page to renewal and use our policy renewal checklist so codes and payroll get rechecked every year.

Get workers’ comp quotes from a local agent

An independent agent can quote several carriers and check that your class codes fit the work. Find an independent insurance agent, browse workers’ comp agencies by state or search for agencies near you.

If you’re also pricing general liability insurance or a business owners policy, ask for all of them at once. Every line we cover is on our coverage page.

Workers’ comp cost FAQ

How much is workers’ comp for one employee?

Workers’ comp for one employee depends on the job and the state. In Oregon in 2026, a $40,000 office worker at SAIF’s tier D rate of $0.06 per $100 comes to $24, so the class minimum premium of $171 applies instead [4]. A $50,000 roofer at the tier D rate of $8.66 costs $4,330 before assessments [4].

How much is workers’ comp per employee per month?

Workers’ comp per employee averaged $113 a month for businesses with one to four employees, according to MoneyGeek’s 2026 modeled estimates [15]. Per-employee figures are a rough guide only. Insurers price workers’ comp on payroll by class code, so a high-paid roofer costs far more than a part-time cashier.

How much is workers’ comp insurance in New Jersey?

New Jersey workers’ comp insurance is among the most expensive in the country. It ranked second in Oregon’s 2024 study at $2.16 per $100 of payroll [1]. Calculated manual rates there were $0.17 for clerical work, $2.99 for retail and $25.89 for low-rise carpentry [2]. New Jersey uses an independent rating bureau, not NCCI [2].

Is workers’ comp insurance required?

Workers’ comp requirements are set state by state. In Texas, most private employers can choose whether to carry it, but those without it must report that to the state [13]. Florida requires it for construction employers with one or more employees and most other employers with four or more [12].

What is a good experience mod?

A good experience mod is anything below 1.00, which means your claims have cost less than expected for a business like yours. A 0.85 mod cuts the premium by 15% [8]. In NCCI states, once a mod is calculated, it must be applied to the policy [8].

Does one claim raise workers’ comp premiums?

One claim can raise workers’ comp premiums through your experience mod, if you have one. Mods typically use three years of claims and skip the most recent policy period [8]. So a claim usually shows up about a year later and can affect several renewals.

The bottom line

Workers’ comp costs your payroll divided by 100, times your class rate, times your experience mod, plus your state’s assessments and charges. For an office it can be a few hundred dollars a year; for roofers, thousands. Get your class codes right and you control most of what’s left. More guides are on our insurance blog.