Estimate your annual workers' compensation insurance premium
Payroll & Business
$
Industry / Job Classification
$
Experience Modification Rate (EMR)
0.5 (excellent)1.0 (average)2.0 (poor)
State Factor
Annual Premium Estimate
$3,840/yr
Estimated annual workers' comp premium
$2,188
Base Premium
$3,840
Modified Premium
$768
Per Employee
$1.54
Eff. Rate/$100
$0
EMR Impact ($)
$320
Monthly Cost
Your Rate vs. Industry Benchmarks ($/100 payroll)
Premium at Different EMR Levels
EMR
Description
Annual Premium
vs. Base
Premium Impact by EMR Level
What is the Experience Modification Rate (EMR)?
The EMR (also called the "experience mod" or "mod factor") is a multiplier applied to your workers' comp premium based on your company's actual claims history compared to others in your industry.
EMR = 1.00: Your claims exactly match the industry average
EMR < 1.00: Fewer claims than average — you get a discount
EMR > 1.00: More claims than average — you pay a surcharge
Calculation period: Your most recent 3 years of claims (excluding the current year)
Who calculates it: NCCI (National Council on Compensation Insurance) in most states
How to Lower Your EMR
Return-to-work program: Getting injured workers back to modified duty reduces claim severity dramatically
Claims management: Proactive communication with injured workers and adjusters speeds claim closure
Audit your payroll classification: Misclassified employees may inflate your base premium — review annually
Self-insurance/captives: Large companies may form captive insurance arrangements to gain more control
Pre-employment screening: Drug testing and background checks reduce certain claim types
State Fund vs Private Insurance
Most states allow private insurance carriers, but some states require purchasing from a state fund:
Competitive states: Most states — you can choose any licensed carrier
Monopolistic state funds: North Dakota, Ohio, Washington, Wyoming — must purchase from state
Self-insurance: Companies with $500K+ in payroll may qualify to self-insure in some states
State fund rates are typically non-negotiable, while private carriers may offer credits for safety programs and claims management.
Workers' Comp Rates by Industry
Approximate base rates per $100 of payroll. Actual rates vary by state, insurer, and claims history. Use these as a reference when selecting your class code above.
Industry
Class Code
Rate per $100
$500K Payroll
Office / Clerical
8810
$0.25
$1,250
Technology / IT
8810
$0.40
$2,000
Retail Store
8017
$1.50
$7,500
Restaurant
9082
$2.40
$12,000
Healthcare
8832
$2.80
$14,000
Manufacturing
3632
$4.50
$22,500
Landscaping
0042
$6.80
$34,000
Trucking
7219
$8.50
$42,500
Construction General
5606
$12.00
$60,000
Roofing
5551
$18.00
$90,000
Logging
2702
$38.00
$190,000
Rates are approximate NCCI averages. Contact your carrier or state workers' comp board for exact rates in your state.
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How to Use This Calculator
1
Select Industry & Class Code
Choose your business type and NCCI class code to determine the base rate per $100 of payroll.
2
Enter Payroll Amount
Input your total annual payroll for each employee classification.
3
Calculate Premium
See the estimated annual premium, adjusted for your experience modification rate (EMR) and any credits or debits.
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Formula & Methodology
Annual Premium
Premium = (Payroll / 100) × Base Rate × EMR
Base rate is per $100 of payroll, modified by your experience rating.
Experience Modifier
EMR = Actual Losses / Expected Losses
An EMR of 1.0 is average; below 1.0 earns discounts, above 1.0 increases premiums.
Cost Per Employee
Per Employee = Annual Premium / Number of Employees
Useful for budgeting the workers comp cost per headcount.
Workers comp premiums are driven by three factors: class code (industry risk), payroll volume, and experience modification rate. A roofing contractor pays 70× more per $100 of payroll than an office worker because the injury risk is dramatically higher. Your EMR — based on three years of claim history — can swing premiums 20-40% in either direction.
Lowering Your EMR
The single biggest lever for reducing premiums is improving workplace safety to lower your EMR below 1.0. Implement a formal safety program, provide proper training and PPE, investigate every incident (not just injuries), and return injured workers to light duty quickly. Companies with an EMR of 0.75 save 25% compared to the industry average.
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Frequently Asked Questions
How is a workers' compensation premium calculated?+
The premium is calculated by multiplying your total payroll (per $100) by the rate for your job classification code, then adjusting by your Experience Modification Rate (EMR). The formula is: Premium = (Payroll / 100) x Class Rate x EMR. Higher-risk job classifications and poor claims history both increase your premium.
What is an Experience Modification Rate (EMR) and why does it matter?+
The EMR is a multiplier that compares your company's claims history to others in your industry. An EMR of 1.0 means average; below 1.0 means fewer claims than average (lower premium), and above 1.0 means more claims (higher premium). A 0.80 EMR gives you a 20% discount while a 1.30 EMR adds 30% to your base premium.
What are job classification codes and how do I find mine?+
Classification codes group occupations by risk level. For example, office clerical work (code 8810) has a very low rate around $0.20 per $100, while roofing (code 5551) can exceed $20 per $100. Your insurance carrier or state workers' comp board can help you identify the correct code for each employee role.
Can I reduce my workers' compensation costs?+
Yes. The most effective strategies are implementing a strong workplace safety program to reduce claims, returning injured workers to modified duty promptly, ensuring employees are classified under the correct (not over-classified) job codes, and shopping your policy across multiple carriers. Improving your EMR is the single biggest lever for long-term savings.
Does every state require workers' compensation insurance?+
Almost every state requires workers' comp for businesses with employees, but thresholds vary. Some states exempt businesses with fewer than 3-5 employees, and Texas allows employers to opt out entirely. Sole proprietors and independent contractors are generally not required to carry coverage but may choose to do so.