Do I need workers' comp if I have no employees?
"Not legally required" and "you won't need it" are two different things. Here's the nuance.
It's one of the most common questions solo operators ask, and the honest answer is: often not legally required — but frequently required anyway. Those are two separate things, and the second one is what trips people up.
The legal side
In most states, a true sole proprietor with no employees isn't legally required to carry workers compensation on themselves. But the details vary a lot by state — definitions of "employee," treatment of family members, and small-business exemptions all differ — so your state's rule is the one that matters.
The contract side (this is the real reason)
Even when the law doesn't require it, the people who hire you often do. General contractors commonly require every subcontractor to carry their own workers comp, so that an injury to the sub goes to the sub's policy — not the GC's. If you can't show coverage, the GC may deduct the cost of covering you from your pay, or simply pass on the job.
Why solo operators sometimes buy it anyway
- To win the work — a certificate showing workers comp can be the difference in landing a contract.
- To cover their own medical bills — many health plans exclude work-related injuries, which can leave a self-employed person exposed after a job-site accident.
Most states allow a sole proprietor to elect to include themselves on a policy for exactly these reasons.
The moment it becomes mandatory
Once you bring on employees, most states require workers comp — and several require it at the very first hire. Sort it out the moment you hire, not after. Remember that workers comp is separate from general liability: GL handles injuries to third parties, while workers comp handles injuries to your workers. Requirements, eligibility, and pricing are determined by the carrier and your state.
Frequently asked questions
Do sole proprietors with no employees need workers compensation?
In most states, a sole proprietor with no employees is not legally required to carry workers compensation on themselves. However, clients and general contractors often require it by contract before you can work, and rules vary by state — so "not legally required" does not always mean "you won't need it."
Why would a contractor require workers comp if I work alone?
General contractors often require subcontractors to carry their own workers comp so that if the sub is injured, the claim goes to the sub's policy rather than the GC's. Without your own coverage, the GC may charge you for coverage or refuse the job.
Can I get workers comp on myself as a sole proprietor?
Many states let sole proprietors elect to include themselves on a workers comp policy. Some buy it specifically to satisfy a contract requirement or to cover their own medical costs from a job-site injury, since health insurance may exclude work-related injuries.
When do I definitely need workers comp?
Once you have employees, most states require it. Thresholds vary (some states require it at the first employee; others have small exemptions), so confirm your state's rule as soon as you hire.
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