Washington Workers Comp: State Fund & Stop-Gap Coverage

Is workers comp required in Washington?

Washington requires most employers to obtain workers compensation through the state Department of Labor & Industries unless they qualify to self-insure. Owners, partners and corporate officers are treated under their own rules, and some workers such as certain agricultural or domestic employees may be handled differently.

Buying coverage in Washington

Private insurers cannot sell standard workers comp in Washington. Employers obtain it from the Washington State Department of Labor & Industries (L&I) unless they qualify to self-insure. Because the state coverage does not include employers liability the way a private policy does, many employers add stop-gap employers liability from a private insurer, often on their general liability policy. Businesses with employees in other states also need private workers comp for those states.

Who sets the rules

The Washington State Department of Labor & Industries (L&I) oversees workers comp in Washington. Washington sets premiums through its state fund rather than a private rating bureau.

What Washington employers should know

• Washington premiums are calculated on hours worked rather than payroll dollars, which is different from most states.
• Because L&I coverage does not include employers liability the way a private policy does, many Washington employers buy stop-gap coverage.

Washington facts employers ask about

Washington is a monopolistic state. The Department of Labor & Industries (L&I) is the insurer for employers that are not approved to self-insure, and private insurers cannot sell standard workers comp in the state. Employers with employees must open an L&I account and file quarterly reports.

Washington premiums work differently from most states. Instead of a rate per $100 of payroll, L&I rates are charged per hour worked by each employee in each risk class, and employers deduct part of the premium from employees' wages. Accurate hour tracking by class therefore drives the cost.

Because L&I coverage does not include the employers liability protection of a private policy, many Washington employers add stop-gap employers liability to their general liability policy, and general contractors and public entities often require it. Businesses with workers in other states need private coverage for those states.

Washington's L&I also publishes the risk class rates for every industry, so employers can see the hourly base rate for their classification before opening an account.

Sources: Washington State Department of Labor & Industries. Rules change; confirm current requirements with the agency before you rely on them.

How premiums are calculated

Premium for Washington state-fund coverage is set by the fund under its own rules and rate tables. Ask the Washington State Department of Labor & Industries (L&I) for current rates and programs, and ask an agent about private stop-gap and other-states coverage. Learn more about how workers comp rates work and preparing for an audit.

Industry guides for Washington employers

Washington workers comp FAQ

Neighboring states