Workers’ Compensation Insurance for Colorado Small Businesses


Without workers’ compensation insurance in Colorado, the cost of medical care and legal fees could follow an employee’s injury or illness while on the job. But The Centennial State understand the need for protections and the ramifications that can arise without them. This is why unless you are sole proprietors or business partners, you are protected by Colorado workers’ compensation insurance.

This also means that if you own a business and have employees, you are required to maintain workers’ comp insurance in Colorado. While every business owner needs to work toward maintaining a safe work environment, accidents happen. Having the right coverages in place isn’t just necessary but can help you protect your company and employees when facing such challenges.

Having workers’ compensation is a great way to not only protect your business and take care of your employees but also attract talent who knows they are protected. This is particularly attractive if you are working within an industry that can attract talent from states without mandated requirements.

Freedom Insurance Group helps local businesses throughout Colorado find the coverages they need while keeping costs low and this is no exception. Our commercial insurance coverage options for workman’s comp can help you fulfill your obligations, protect employees, and save in the process. Learn more about how it works, costs, who needs it, and how to find coverage.


Does Colorado Require Workers’ Compensation Insurance?

Yes, workers’ compensation insurance in Colorado is required by law according to the state’s Department of Labor. There are some exceptions as business partners and sole proprietors aren’t considered employees, but your company’s employees must have coverage. Furthermore, under some circumstances, independent contractors may also fit as an exception.


Colorado Workers’ Comp Insurance Requirements

If you’re operating a business within colorado, workers’ compensation insurance requirements are important to understand. Otherwise, you may end up facing a situation in which you lack the right kind of coverage opening up yourself to a variety of losses, lawsuits, and even ramifications from the government. Here are some of the highlights:

  • People hired to perform services for pay are defined as workers by law.
  • Unemployment insurance does not equate to Colorado workers’ comp insurance.
  • Your coverage must provide compensation for employees injured while on the job, a death benefit for dependent survivors, and compensation for anyone permanently injured while working.
  • Your company must pay for this coverage and you cannot deduct it from the wages of your workers’ wages.

Failing to maintain the right level of coverage can not only leave your business exposed to lawsuits and costs but you may also be fined $500 per day or even shut down as a result. But don’t take our word for it. As you can see below, the Colorado Department of Labor has outlined the exact requirements for workers’ compensation insurance within the state:



Images sourced from the Colorado Department of Labor and Employment


When we look at the Insurance Information Institute (III) and how workers’ comp works, you’ll see that a variety of injuries are protected including workplace accidents, violence in the workplace, those caused by natural disasters, and injuries sustained from terrorism.

Again, these are some of the worst events that can happen in the workplace, but no matter how many safety procedures you follow or guidelines you enforce, outside factors and accidents can still happen.

The Colorado Division of Workers’ Compensation may require the coverage but in the long run, everyone remains better protected and can have peace of mind that they will be helped should the unthinkable occur.


How Much Does Workers’ Compensation Insurance Cost in Colorado?

To determine workers’ comp insurance in Colorado’s cost, you’ll have to take in many different factors. This means considering your payroll, the number of employees you have, your operation’s location, the industry you are in, etc.

There are even more than 700 class codes from the National Council on Compensation Insurance (NCCI) that go into the calculation. Here, you can work to define the nature of the work employees are subjected to and help better calculate the cost for your company.

But there are some common sense approaches here. This includes that in general, you can expect to pay higher costs if you have more employees, are in a riskier industry, have a high amount of claims, etc.

The average cost for workers’ comp insurance in Colorado is calculated based on risk. The more risk your company possesses, the higher your premiums will be and if you hold less risk, you will also enjoy lower rates. It’s also important for Colorado business owners to remember that each carrier is going to assess its risk factors in a different manner.

This means your premiums will fluctuate depending on who you enroll with, even if you provide the same level of coverage. At Freedom Insurance Group, this is why we’ve partnered with multiple top-rated carriers, to help businesses shop around and identify the lowest rates for their coverage needs.

Colorado workers’ compensation insurance is a cost of doing business you can’t afford to skim on, but that doesn’t mean you need to overpay. Workers’ comp claims can reach tens of thousands of dollars and possibly even six figures when vehicles are involved. Not to mention, it’s required coverage by law.

For these reasons and more, finding a policy far outweighs the risk of paying hefty payouts, legal fees, and potential fines. Take the time to shop around with a licensed Colorado workers’ comp insurance agent and you’ll be able to stay covered without breaking the bank.


Do Sole Proprietors Need Workers’ Comp Insurance in Colorado?

While workman’s comp in Colorado isn’t necessary for sole proprietors, you may still need the coverage when your employees are performing work. For example, if you hire contractors to perform a service for pay, they become a worker and are required to be covered by these benefits. To understand the specific requirements of your business, speaking with a licensed insurance agent can help you stay better protected and avoid issues with the government.


Key Considerations for Workers’ Comp Insurance in Colorado

Dealing with any form of coverage is a big deal no matter what size your business is, especially when it is mandated by the government. Everything from workers’ comp insurance rates in Colorado to the amount of coverage you’ll need and more is all important considerations you’ll have to make decisions for involving your company.

Fortunately, you don’t have to make them alone, as our team is here to help. Feel free to contact us, or refer to some of the key variables all business owners operating in The Centennial State will need to mull over:

  • There is no singular best insurance policy. Some policies are better for some than they are others. This is why we focus on helping you find a carrier that is reliable, affordable, and provides the coverage you need.
  • Exceptions exist, but navigating this can be difficult. Before you forgo coverage and end up in a bind, speak to a professional to ensure your business is headed in the right direction.
  • Work-related illnesses may be covered and this can include employees contracting COVID-19. While the world is much different than it was in 2020, it’s important to remember this factor when operating your company.
  • There are many other types of business insurance policies available in Colorado and we’re happy to help you find those that are right for you. But none of them cover the injuries or illnesses your employees receive while working for your company the same way colorado workers’ compensation insurance policies will.
  • The construction industry is handled a bit differently in Colorado and may also require an expert, licensed agent to determine how you plan to move forward. If you’re operating within this industry, connecting with an agent can help you ensure everything your company needs in place is there to protect you.

How To Get Workers’ Comp Insurance in Colorado


If you’re in need of coverage, we’re here for you. Contact a Colorado workers’ comp insurance agent today to assess your risks, get a quote, and find the right policy that fits the needs of your business.

The role of businesses is to produce value and while protecting your employees and remaining legal is important, it’s also critical to maintain a balance by assessing policies and choosing those that fit your company’s budget. Furthermore, you’re going to want to enroll in coverage using Colorado workers’ comp insurance providers you can trust.

This is why here at Freedom Insurance Group, we only work with top-rated, financially sound providers to help you find the most affordable policies with the best coverage on the market. We understand the plight of business owners and are here to help you save.

You don’t have to overpay to stay protected. workers compensation insurance colorado is available, get a free quote today!

Contact Us

Freedom Insurance Group
3861 Long Prairie Rd Ste 110
Flower Mound, TX 75028
Phone: (972) 798-3769


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