Do I need workers compensation insurance?

Workers' Compensation Insurance Requirements in Maryland

In Maryland, most employers are required to carry workers' compensation insurance to cover medical expenses and lost wages for employees injured on the job. This insurance is a critical part of compliance and risk management for businesses operating in the state.

When Is Workers' Compensation Insurance Required?

• Number of Employees: If your business has one or more employees, you generally must have workers' compensation insurance.
• Type of Employees: The requirement applies to full-time, part-time, and seasonal employees. Independent contractors are usually not covered but classification should be reviewed carefully to avoid misclassification.
• Industry Exceptions: Some specific industries or types of employers may have exemptions, but these are limited and should be verified with Maryland's Workers' Compensation Commission.

Operational Steps to Comply

• Obtain Coverage: Purchase workers' compensation insurance through a private insurer or the state fund.
• Employee Classification: Accurately classify employees to ensure proper coverage and premium calculation.
• Recordkeeping: Maintain detailed records of all employees and payroll to support compliance and reporting requirements.
• Posting Requirements: Display the official workers' compensation notice in a visible location at your workplace.
• Claims Management: Establish a process to report workplace injuries promptly to your insurer and the Maryland Workers' Compensation Commission.

Additional Operational Considerations

As of 2026, businesses should integrate workers' compensation insurance management with payroll and bookkeeping systems to streamline premium payments and reporting. Automation tools can help maintain compliance and reduce administrative burden.

Also, consider how workers' compensation insurance interacts with your business's general liability insurance and employee classification practices to optimize overall insurance costs and coverage.