Georgia Workers' Compensation Insurance

​​Georgia has relatively high workers' comp rates, compared to national averages. A 2020 study by the Oregon Department of Consumer and Business Services found that Georgia had an average workers’ compensation index rate of $1.64. This means Georgia is ranked 15th in the U.S., down from a position of 6th in a 2018 study. On average, Georgia businesses can expect to pay about $1.64 per $100 in total payroll.

Georgia 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 classification code, or industry classification. Class codes categorize businesses, and NCCI assigns rates to each class code based on the relative risk for illness or injury.

When seeking a workers’ compensation policy, small business owners can contact a licensed insurance agent or carrier. The insurance carrier calculates the final premium cost based on the advised rate, the company’s payroll, Experience Modifier, and any additional credits or debits based on the company’s workplace safety. Learn more about how workers' compensation costs are calculated.

If your business is having trouble finding coverage, NCCI also administers Georgia’s assigned risk pool, which will place you with a carrier.

Average Cost of Workers’ Comp in Georgia

The average cost of workers’ compensation premiums in Georgia, as of 2020 data, was $1.64. This is also called the “Premium Index Rate.” Workers’ compensation costs are calculated by multiplying the premium index rate per $100 of payroll.

So, in other words, a business with a total payroll of $200,000 would pay a $3,280 per year in workers’ compensation premiums. However, it’s important to note that the premium index rate is only an average. Depending on the exact line of business, costs could be much higher or lower.

For example, construction workers have a higher risk of being injured than retail employees – and workers’ compensation premiums would reflect this. And the opposite is true, too. Employees in lower-risk positions are less likely to be injured, so your rates would be lower in that case.

Why Are Workers’ Comp Rates Higher In Georgia?

Workers’ comp premiums in Georgia are a lot cheaper than they were a few years ago, but Georgia is still quite a bit more expensive than some other states when it comes to workers’ comp rates. There are a few things that can influence this, and may explain Georgia’s higher rates.

• Types of industries – Georgia has lots of jobs in healthcare, logistics, manufacturing and construction. States with more jobs in higher-risk industries like these tend to have higher average workers’ comp costs, since the overall risk of a work injury is increased.
  
• State laws about workers’ compensation – Every state has its own workers’ compensation laws and requirements. These can directly influence the cost of coverage. For example, Georgia requires all businesses with three or more employees to carry a workers’ comp policy. However, Texas – the 46th-cheapest state for workers’ comp as of 2020 – does not require employers to carry workers’ comp policies at all.
• State policies related to payouts – In general, states with more generous workers’ comp payouts will have higher premiums and insurance costs. That makes sense, of course. If a state like Georgia requires higher payouts to workers who are injured, insurers will have to adjust their rates accordingly.
• Overall healthcare costs – Workers’ comp must cover the costs of injuries that happen at work. So, as the cost of healthcare goes up, so does the overall price of Georgia workers’ compensation insurance. 

Why Do Some Georgia Businesses Have Higher Workers’ Comp Rates?

Just because the premium index rate is $1.64 doesn’t mean all businesses pay this exact amount for workers’ compensation insurance in Georgia. In fact, most companies pay more – or less – than the premium index rate. The biggest factor is your line of work. The higher the risk of injury in your business, the more you’ll pay in workers’ compensation premiums. 

Another factor is your safety record. If you have a long record of safety and few workplace injuries, you’ll have a lower rate. On the other hand, if you have a higher rate of injuries, you may have to pay a higher overall premium.

So, for example, someone running an accounting business and has no history of workers’ comp claims could pay just $1 per $100 of payroll, which is lower than the premium index rate of $1.64. If their business paid out $100,000 in wages annually, they’d pay just $1,000 in total for coverage.

On the other hand, someone who runs a plumbing business in Georgia and has lots of accident claims could pay $2-$3 per $100 of payroll, or even more. For a company with total wages of $100,000, that adds up to $2,000 or $3,000.

What Are Georgia’s Workers’ Compensation Class Codes?

Georgia workers’ compensation classification codes or “class codes,” are set by the National Council on Compensation Insurance, or NCCI. Each class code has a certain level of risk, and insurance costs are adjusted accordingly. By taking into account all the employees at your business and their various class codes, insurers can understand the overall level of injury risk at your company.

Let’s say you run a landscaping business in Georgia with five workers. Four of them are landscapers. They are assigned the class code "0042.” This class code has a higher risk of injury, because landscapers must move heavy equipment, use power tools, and so on.

The other worker at your landscaping business is an accountant. They are assigned the class code “8803.” This class code has a very low risk of injury, since accountants usually work on computers and in offices, where injuries – while not impossible – are uncommon. 

When writing an insurance policy for workers’ compensation insurance in Georgia, an insurance company would take the risk of each employee into account. Overall, this landscaping business would pay a relatively high rate for insurance, since it has four workers who are assigned a high-risk class code, and only one worker with a low-risk class code.

If you employ three or more people at your business in Georgia, you need to have workers’ compensation insurance.

Do Business Owners Need Workers’ Comp In Georgia?

This includes full-time, part-time, and seasonal employees. If your business is incorporated or operates as an LLC, all officers and LLC members are included in this employee count, too.

It is possible for you to waive coverage on yourself, and up to five total officers or members. To do this, you must file form WC-10 with your insurance carrier. However, this does not mean that you do not count as employees. 

Even if you waive coverage, you and all others who waive coverage are still included in the employee count. So for example, let’s say your company has five officers, you all waive coverage, and your business only employs a single part-time worker. You still would be required to purchase workers’ comp insurance for that single employee under Georgia laws and requirements, because your company is considered to have six total employees.

The exception to this is if you are a sole proprietor or operate in a partnership, you are not considered to be an employee. You can still opt in to coverage as an employee by notifying your insurance carrier in writing that you wish to be included.

Where can I buy coverage?

The state has a private market, which means you can purchase a workers' compensation policy from any private insurance carrier or agency that is licensed in Georgia. Unlike some states, Georgia does not have a state fund that competes with the private market. If you have trouble getting coverage, you can get a policy through the state’s assigned risk pool.

Which workers need to be on the policy?

Georgia requires most employers with three or more employees (full-time, part-time, and/or seasonal) to carry workers’ compensation insurance. If the business has three or more employees, all employees must be covered by the workers’ compensation policy.

Keep in mind that even if a business isn’t legally required to carry coverage, the employer may still be held liable if a worker is injured on the job.

Who’s considered an employee?

Employers don’t get to decide who is legally considered an employee. Most states agree that full- and part-time workers are employees, but they may differ in how they treat sole proprietors, partners, members of an LLC, independent contractors and family members.

Georgia considers sole proprietors and partners to be employers, so they don’t need to be covered — but can choose to be added to the policy, if they wish. Also, Georgia contractors must also be wary of subcontracting work; they could be held liable if the subcontractor has employees but not work comp coverage. See details on owners and officers here.

What if my workers leave the state?

All work comp policies provide coverage within state lines. If workers need to cross state lines to complete work, they may not be covered by the policy.

If it applies to your business, check with your insurer about reciprocity with other states, or getting an All States Endorsement.

Do Independent Contractors Need Workers’ Comp In Georgia?

If you are an independent contractor in Georgia, you are not required by law to purchase workers’ comp. However, you also will not be covered by a client’s workers’ comp policy. Under Georgia law, independent contractors are not considered to be employees in any capacity, and do not qualify for workers’ comp benefits if they are injured on the job.

Because of this, we strongly encourage independent contractors to purchase their own workers’ compensation policy in Georgia. If you do purchase a policy for yourself, you will be covered in the event of a workplace injury – not under your client’s policy, but under your own.

Georgia Work Comp Resources

• Regulated by the State Board of Workers’ Compensation
• Georgia rating bureau & assigned risk pool: NCCI (National Council on Compensation Insurance)

Editor's note: This page was updated in 2022 for accuracy and comprehensiveness.