Do I need workers compensation insurance?

Workers Compensation Insurance Requirements in Colorado

In Colorado, whether you need workers compensation insurance depends on your business size and employee status. This insurance covers medical expenses and lost wages for employees injured on the job.

When Workers Compensation Insurance Is Required

• Employers with one or more employees: If your business has at least one employee, you are generally required to carry workers compensation insurance.
• Corporate officers and LLC members: Coverage for corporate officers and LLC members is optional but can be elected to provide protection.
• Domestic workers and agricultural employees: Some exceptions apply, but most standard employees are covered under the requirement.

Operational Considerations

• Business registration: Ensure your business registration reflects your employee count accurately for compliance.
• Payroll reporting: Maintain precise payroll records as they affect insurance premiums and reporting obligations.
• Insurance carriers: Choose a state-approved insurer or participate in the state’s Workers Compensation Pool if eligible.
• Recordkeeping: Keep detailed injury and claim records to manage compliance and potential audits.

Additional Notes

As of 2026, Colorado requires most employers with employees to carry workers compensation insurance. Failure to maintain coverage can result in penalties and business interruptions. Consult your insurance provider or a business operations consultant to ensure proper coverage and compliance.