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Texas workers’ compensation insurance is essential for providing your employees with important benefits if they get an injury or illness from their job. To learn more, read through each section below.
Texas Workers’ Compensation Insurance
As the second largest state in the country, Texas has so much to offer. With many booming businesses and start-up companies, you may be wondering what you need when it comes to workers’ compensation insurance. Also known as workers’ comp or workman’s comp, most states require employers to carry this coverage. In the Lone Star State, however, you’re not required to have it.1
Even though it’s not required by law in Texas, it’s still a good idea to have workman’s comp insurance. In addition to helping injured employees return to work, it can also help Texas employers pay for legal costs if they get sued because of an injury or illness. Without coverage, you’d have to pay for these costs out of pocket, which could put your business at financial risk.
What Is Workman’s Comp in Texas?
Texas workers’ compensation insurance gives your employees benefits to help them recover from a work-related injury or illness. Workman’s comp in Texas can also help employers because it provides a defense against claims of:
- Assumption of risk
- Contributory negligence
- “Last clear chance”
- Co-worker negligence
Without workers’ compensation insurance in Texas, the business owner is responsible for all costs related to a personal injury lawsuit. Even if it’s your employee’s fault that they got hurt or sick, you’d still have to pay for costs related to the lawsuit.
Coverages for Workers’ Comp Insurance in Texas
With coverage, business owners and employees can experience many types of workers’ compensation benefits, such as:
- Income benefits, like lost wages from missing work
- Medical benefits to help treat a workplace injuries or illnesses
- Legal benefits if a worker’s family sues your business
- Death benefits to an employee’s family if they lose their life in a work-related accident
According to Texas’ workers’ comp laws, employees have 30 days to give notice of a work-related injury or illness to their employers.2 They also have a year to file formal paperwork for the workers’ comp claim. After getting a report of injury, employers have eight days to notify their insurer.
Texas Workers’ Compensation Laws
Does Texas Require Workers’ Compensation Insurance?
Texas doesn’t have a workers’ comp requirement. But being a “non-subscriber” or operating a business without it can put your company at serious risk.3 That’s because without coverage, your business faces personal injury lawsuits. As a small business owner, you should be sure your employees are safe and that you’re minimizing on-the-job injuries. You can get workers’ comp insurance from any insurance carrier licensed to write workers’ compensation insurance in Texas.
Does Texas Require Workers’ Compensation Insurance?
Although Texas doesn’t require employers to have coverage, there are rules on how the insurance works. Texas’ workers’ compensation laws set the limits on how many benefits employees will get if they’re hurt or sick on the job.
Texas Workers’ Comp Requirements
Workers’ compensation employer obligations include:
- Disclosing to employees whether a business has workers’ compensation insurance.
- Notifying the Workers’ Compensation Division (DWC) of the Texas Department of Insurance if your business no longer has coverage. You can do this with Form DWC005.
There’s also no coverage for injuries resulting from:
- Employee horseplay
- Willful criminal acts or self-injury
- Intoxication from drugs or alcohol
- Voluntary participation in off-duty recreational activity
- Acts of God
Learning and understanding Texas workers’ compensation law is extremely important when it comes to the safety of your business and employees.
The Division of Workers’ Compensation Texas
The Division of Workers’ Compensation (DWC) monitors both employees and employers. It will take action to make sure businesses and workers are following state laws, such as the:
- Texas Workers’ Compensation Act
- Texas labor code
- Other workers’ comp insurance regulations
Texas Workers’ Compensation Rates
The Texas Department of Insurance (TDI) regulates the workers’ compensation system in the state, ensuring that all workers’ compensation costs stay at a reasonable rate.
In Texas, workers’ compensation insurance costs include:
- Insurance premiums
- Payments made under deductibles
- The administrative costs of handling claims and making reports to the state of Texas and your insurer
Texas workers’ compensation rates vary and insurance carriers can use different factors to determine costs, including:
- The type of work your employees do – the higher the risk, the more it can impact your insurance price.
- Your claims history, since a safer work environment means you’re less likely to file workers’ compensation claims and can result in a lower insurance cost.
- Payroll size because your insurance rate depends on the number of employees you have.
How Much Does Workers’ Compensation Insurance Cost in Texas?
Business insurance costs in Texas vary because each business is unique and has different needs. Customers pay an average of $576 annually, or $48 a month, for workers' compensation insurance in Texas.5
How is workers’ comp calculated? The best way to find the right insurance coverage is to compare quotes from multiple insurance companies. To get started, get a quote from us today. We’re an experienced insurance company that can help you get the coverage you need. Whether it’s coverage questions or filing a claim, our specialists are here to help you at every step.
Workers’ Compensation Claims
To file a claim for workers’ compensation in Texas, visit our workers’ comp claims page today.
Last Updated: November 20, 2023
This article provides general information, and should not be construed as specific legal, HR, financial, insurance, tax or accounting advice. As with all matters of a legal or human resources nature, you should consult with your own legal counsel and human resources professionals. The Hartford shall not be liable for any direct, indirect, special, consequential, incidental, punitive or exemplary damages in connection with the use by you or anyone of the information provided herein.
1,2,3,4 Texas Department of Insurance, “Workers' Compensation Insurance Guide.”
5 Premium amounts presented are based on monthly premium paid by The Hartford’s Small Business customers between 1/1/22 and 9/14/23 for 12-month policies. Premium is derived from a number of factors specific to your business and may vary.
Additional disclosures below.