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Colorado Workers' Compensation Insurance

Colorado requires all employers to carry workers’ compensation insurance, with few exceptions. The state has been dealing with similar issues as other states, including opioid abuse, mental health benefits and gig economy workers.

Read on for more on how to purchase workers’ compensation insurance in Colorado.

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Small Business Work Comp Requirements in Colorado

You are required to carry workers' compensation insurance in Colorado if:

  • You have any employees working in Colorado, even part-time.
  • You hire any workers, even if not employees. Common law guidelines distinguish independent contractors from employees, but Colorado is strict on this front: Subcontractors and independent contractors may be considered employees unless they fall under specific exceptions in the state law.

The state has a strict workers’ compensation system, with few exceptions.

Sole proprietors and partners: You are excluded from coverage, but have the option to include yourself.

Corporate officers and members of an LLC: Colorado includes you in coverage, but if own at least 10% of the company you can opt out of coverage. A rejection of work comp benefits must be done in writing.

Domestic workers: Some domestic and maintenance workers that perform work on a limited, part-time basis for a homeowner may not need to be covered by law.

How to Buy Small Business Workers’ Compensation Insurance

Colorado has a private market, which means you can purchase workers’ compensation insurance from any private insurance carrier or agency that is licensed to write in that state.

Colorado Workers' Compensation Insurance Carriers

Commercial insurance carriers must be licensed by the state to bind workers' compensation policies in Colorado. WorkCompOne’s online platform makes it possible for leading national insurance carriers to serve all businesses, even those with fewer than ten employees. Get started on a small business policy >>

If you’re still having trouble finding coverage, you can contact Colorado's Pinnacol Assurance, which will provide you with coverage.

Self-insurance, either individually or as a group, is also allowed. This is typically an option for larger employers.

Colorado Workers' Compensation Rates

Colorado workers’ compensation rates are recommended by the National Council on Compensation Insurance (NCCI), which most states use as their rating bureau. NCCI collects data on workplace injuries and advises rates based on class code, or industry classification.

Small business owners can contact a licensed commercial insurance agent or carrier to buy workers' compensation coverage. The insurance carrier calculates the final premium cost based on the set rate, the company’s payroll and its Experience Modifier. 

The Colorado state legislature has made several recent changes to the work comp system. These include:

  • Created a voluntary benefits program for firefighters diagnosed with cancer.
  • Penalty money collected by the division will fund benefits to the injured workers of uninsured employers.
  • Expanded cases where workers can receive benefits for a PTSD diagnosis.

How to address opioid abuse, and workers’ compensation benefits for “gig economy workers,” such as Uber drivers, have also been recent topics of debate.

Tip: General liability and workers’ compensation insurance are the two most basic insurance policies that every business should have, but they’re often confused. Learn more about general liability >>

Colorado Work Comp Resources

Editor's note: Last updated on December 12, 2018

Here's What You Need to Get Started

To buy workers compensation insurance, you need to request a quote from a licensed insurance agent and provide some details about your business.

Here’s what to have in front of you:

  • Number of employees in each class code.
  • Total payroll for all employees. You may be able to exclude yourself if you don't wish to be covered under the policy. 
  • Federal ID Number. If you are a sole proprietor, you can use your Social Security Number.
  • Copy of your workers comp insurance policy, if you've had coverage or claims in the past few years. If you know your company's experience mod, please have your experience mod rating sheet or policy in front of you. Otherwise, you will be assigned a default rating of 1.0.

The information on this page has been interpreted and summarized for your convenience. Please consult your state's governing authority for the most current and complete legislation.