Estimate your workers compensation premium from payroll, class code, and experience mod
New businesses start at a 1.00 experience mod. A few years of low claims can earn a credit below 1.0; frequent or severe claims push it above.
Estimate based on national averages. Your actual premium depends on your insurer, location, and personal details.
| Class Code | Industry | Avg Rate per $100 of Payroll |
|---|---|---|
| 8810 | Clerical / office | $0.15 |
| 8017 | Retail store | $1.40 |
| 9082 | Restaurant | $1.80 |
| 8380 | Auto repair | $2.20 |
| 3632 | Manufacturing / machine shop | $2.90 |
| 8835 | Healthcare / home care | $3.00 |
| 5190 | Electrical | $3.40 |
| 5183 | Plumbing | $4.20 |
| 0042 | Landscaping | $6.50 |
| 5645 | Carpentry | $8.00 |
| 7228 | Trucking | $9.50 |
| 5551 | Roofing | $15.00 |
National average NCCI-style rates; state rates vary. The spread is the whole story: roofing costs one hundred times more to insure than office work, per payroll dollar.
| Benefit | Typical Provision |
|---|---|
| Wage replacement | 66⅔% of average weekly wage, tax-free |
| Maximum benefit | Capped at a state maximum weekly amount, which varies by state |
| Medical care | Covered 100%, no deductible or copay for the injured worker |
| Waiting period | 3 – 7 days before wage benefits start, often paid retroactively for longer disabilities |
These are the common state patterns, not a specific state's schedule. Every state runs its own system with its own caps and waiting periods.
If you're hiring your first employee or budgeting for next year, you need a workers comp number before an agent will give you one. This calculator produces that number the same way insurers do: from your payroll, the risk class of the work, and your claims history. It's an estimate built on national average rates, not a quote, but it'll put you in the right neighborhood for planning.
Annual premium = (annual payroll ÷ 100) × class rate × experience modifier. Workers comp is priced per $100 of payroll, and the rate depends almost entirely on what your employees do. Office work (class 8810) runs about $0.15 per $100 because desk injuries are rare. Roofing (5551) runs about $15.00 because falls are common and expensive. The experience modifier then scales the whole thing: 1.00 is average and where every new business starts, safe operations earn below 1.0, and claim-heavy ones pay above it.
Enter your total annual payroll, pick the class that best matches most of your workforce, and set your experience mod if you know it (it's printed on your current policy; leave 1.00 if you're new). If you employ a mix, run the tool once per group and add the results, because that's how your insurer rates it too.
A restaurant with $500,000 in annual payroll: $500,000 ÷ 100 = 5,000 payroll units, times the $1.80 restaurant rate, times a 1.00 mod = $9,000 a year, or $750 a month. Now compare an office with identical payroll: 5,000 × $0.15 = just $750 a year. Same wages, wildly different risk, and the premium follows the risk.
Divide your annual payroll by 100, multiply by your class code's rate, then multiply by your experience modifier. A restaurant with $500,000 in payroll at a $1.80 rate and a 1.00 mod pays about $9,000 a year. Rates come from your state and the risk level of the work, which is why roofing costs a hundred times more than office work.
A multiplier that compares your claims history to similar businesses. The average is 1.00, which is where every new business starts. A clean few years can earn you 0.85 or lower, a direct discount on your premium. Frequent or severe claims push it above 1.00, and some contracts won't hire firms with a mod over 1.0.
In almost every state, yes, typically from your first employee. Texas is the notable exception where coverage is optional, though most employers carry it anyway because opting out removes key legal protections. Going without required coverage brings fines, stop-work orders, and personal liability for injury costs, so the penalty risk dwarfs the premium.
Work the experience mod: safety training, prompt claim reporting, and return-to-work programs all cut claim costs, which lowers the mod over time. Also make sure employees are classified correctly, since misclassifying clerical staff under a field code overcharges you badly. Finally, audit your payroll estimates so you're not paying premium on wages you never ran.
The standard wage-replacement benefit is 66⅔% of the worker's average weekly wage, tax-free, up to a state maximum cap. Medical treatment for the injury is covered at 100% with no deductible. Most states impose a 3 to 7 day waiting period before wage benefits start, often paid retroactively if the disability runs longer.