Do businesses need workers compensation insurance before hiring?

Workers' Compensation Insurance Requirements in Delaware Before Hiring

In Delaware, businesses generally must secure workers' compensation insurance before hiring employees. This insurance provides coverage for medical expenses and lost wages if an employee is injured on the job.

Key operational points to consider:

• Mandatory Coverage: Most Delaware employers with one or more employees are required to have workers' compensation insurance in place before starting work.
• Business Registration: Ensure your business is properly registered with the Delaware Division of Revenue and other relevant state agencies prior to hiring.
• Payroll Setup: Implement payroll systems that account for workers' compensation insurance premiums as part of your overall employee cost structure.
• Employee Classification: Correctly classify employees to determine appropriate insurance rates and coverage needs.
• Compliance and Recordkeeping: Maintain accurate records of insurance coverage and employee injury reports to comply with Delaware reporting requirements.
• Insurance Providers: Delaware allows businesses to obtain workers' compensation insurance through private carriers or the state-run assigned risk pool if coverage is otherwise unavailable.

As of 2026, securing workers' compensation insurance before hiring helps avoid penalties and supports operational continuity by managing workplace injury risks effectively.