Do I need workers compensation insurance?

Workers Compensation Insurance Requirements in Michigan

In Michigan, workers compensation insurance is a critical component of business operations for companies with employees. Understanding when this insurance is required helps maintain compliance and manage risk effectively.

When Is Workers Compensation Insurance Required?

• Employers with one or more employees: As of 2026, Michigan law requires most employers with at least one employee to carry workers compensation insurance.
• Type of employees: This includes full-time, part-time, seasonal, and temporary workers.
• Exceptions: Certain employers, such as sole proprietors or partners without employees, may not be required to carry this insurance but can opt in voluntarily.

Operational Considerations

• Business registration: Ensure your business is properly registered with the Michigan Department of Licensing and Regulatory Affairs (LARA) to meet insurance requirements.
• Insurance provider selection: Choose a licensed workers compensation insurance provider in Michigan to secure coverage.
• Payroll and recordkeeping: Maintain accurate payroll records and employee classifications to correctly calculate insurance premiums and support compliance.
• Claims management: Establish clear processes for reporting workplace injuries promptly to reduce operational disruptions.
• Compliance monitoring: Regularly review insurance coverage and employee status to ensure ongoing adherence to state requirements.

Additional Tips

Consider integrating insurance management with your broader compliance and payroll systems to automate premium calculations and reporting. This approach helps streamline operations and reduces administrative overhead.