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Connecticut business insurance: requirements and costs

Connecticut requires workers' compensation coverage as soon as you pay one employee, with no headcount threshold and no separate rule for construction.⁠3 Loss costs come from NCCI: on September 29, 2026 the Insurance Department opened comment on NCCI's request for a 4.9% average decrease in voluntary loss costs from January 1, 2027.⁠1 Employers also withhold a 0.5% CT Paid Leave contribution from each employee's pay.⁠4

Checked against 10 sources Last reviewed How we check figures

Connecticut at a glance

Workers’ comp required1+ employees; no separate construction rule
Where employers buy itPrivate insurers
Rates set byNational Council on Compensation Insurance
Employer comp cost, 2023$0.92 per $100 of covered wages (US $0.98)
Comp rate index, 2024$1.48, ranked 6 of 51 (1 = most expensive)
Employer health premium, 2025$9,987 single, $28,700 family (average total premium)
Auto liability minimum25/50/25
Payroll insurance programsCT Paid Leave

There is no state fund. Employers insure with a licensed carrier, furnish proof of solvency to the chairperson of the Workers' Compensation Commission, or file security with the Insurance Commissioner.⁠3 NCCI files voluntary-market loss costs and assigned-risk rates for the state, and the Connecticut Insurance Department takes public comment without a hearing.⁠1⁠2 The Department's notice for the January 1, 2026 filing shows NCCI asking for a 3.8% average decrease in voluntary loss costs and a 0.4% decrease in assigned-risk rates.⁠2 The Commissioner's memorandum and order of October 27, 2025 accepted the voluntary loss costs and assigned-risk rates as filed, so those are the approved changes.⁠10 The 2027 filing is pending and is larger: -4.9% in voluntary loss costs and -5.8% in assigned-risk rates, with the filing's components being -4.0% for experience, -1.9% for development, +0.4% for benefits and +0.5% for loss-based expenses.⁠1 By industry group, NCCI proposes -6.0% for contracting, -5.5% for manufacturing and -3.6% for office and clerical.⁠1 These are proposals for averages; your class and experience modification decide your own change.

Connecticut's cost position depends on which measure you use. NASI's 2023 data put employer cost at $0.92 per $100 of covered wages, below the $0.98 national figure and down from $1.09 in 2019. By our calculation that is a 16.0% drop, about the same as the 16.3% national decline.⁠7 Oregon's ranking, built from manual rates in effect January 1, 2024, puts Connecticut sixth most expensive of 51 jurisdictions, at an index of $1.48 per $100 of payroll, 135% of the median.⁠8 The gap means Connecticut's published manual rates are high while the premiums employers actually paid in 2023 were below average. Neighbors differ widely: New York's index is $1.98 (rank 3), Rhode Island's $1.38 (rank 10) and Massachusetts's $0.97 (rank 31).⁠8 Health coverage is more available than elsewhere among small firms. AHRQ's 2025 survey found 40.9% of Connecticut private-sector establishments with fewer than 50 employees offered health insurance, against 32.1% nationally, and where offered the average single premium was $8,243, 8.8% below the $9,034 small-firm national average by our calculation.⁠9

Three Connecticut rules affect what you carry. First, an uninsured employer loses the statutory shield against damage suits, so an injured employee may sue for damages.⁠3 Second, a principal employer that hires a contractor or subcontractor for work in its own trade or business, on premises it controls, is liable for compensation as if the work were done without the intermediary, so a sub's lapse can land on you.⁠3 Third, the state ties premium fraud to criminal law: knowingly labeling employees as independent contractors, or giving an insurer false payroll or headcount information to pay a lower premium, is a class D felony with a stop work order from the Labor Commissioner.⁠3 Auto liability policies must carry at least 25/50/25 and uninsured and underinsured motorist coverage at no less than those limits.⁠5⁠6

Workers’ compensation in Connecticut

Any employer using the services of one or more employees for pay must insure its liability or qualify to self-insure.⁠3 Corporations, LLCs, firms and partnerships all count as employers.⁠3

Who is exempt

  • Sole proprietors and business partners are covered only if they accept the Act
  • A corporate officer who elects, by written notice to the employer and the administrative law judge, to be excluded
  • Casual employees hired for purposes outside the employer's trade or business
  • Workers in or about a private dwelling who are not regularly employed by the owner or occupier over 26 hours a week

Buying coverage and who sets the rates

Employers buy from a licensed insurer authorized to write comp in Connecticut, or insure through a combination of insurance and security filed with the Insurance Commissioner.⁠3 Employers that cannot find a voluntary carrier use the assigned-risk market, whose rates NCCI files alongside the loss costs.⁠1⁠2

An employer that gives the Workers' Compensation Commission chairperson satisfactory proof of solvency and ability to pay compensation directly is not required to insure; the statute also allows security filed with the Insurance Commissioner.⁠3

Penalties for going without

After a hearing, an administrative law judge assesses a civil penalty of not less than $500 per employee or $5,000, whichever is less, and not more than $50,000, plus $100 for each day after the finding that the employer stays out of compliance, with those daily penalties capped at $50,000 in total.⁠3 A knowing and wilful failure to insure is a class D felony for the owner, partner, LLC principal or corporate officer.⁠3

What Connecticut employers pay

Employer workers’ compensation costs per $100 of covered wages, 2019–2023
YearConnecticutUnited States
2019$1.09$1.17
2020$1.04$1.08
2021$0.99$1.01
2022$0.95$1.00
2023$0.92$0.98

Employer cost per $100 of covered wages: premiums paid by insured employers plus benefits and administrative costs of self-insured employers, divided by the wages of workers covered by workers’ compensation. The United States figure is NASI’s national total, which includes federal programs. Source: National Academy of Social Insurance (NASI), published 11 Aug 2026.

Oregon’s biennial comparison of workers’ comp rates puts Connecticut’s index for rates in effect on 1 January 2024 at $1.48 per $100 of payroll, 35% above the national median of $1.09 (rank 6 of 51, where 1 is the most expensive). The index prices the same 50 risk classes, weighted by Oregon payroll, in every state, so it compares rate levels rather than what employers actually pay. Compare every state.

Disability and paid leave insurance

Connecticut runs a payroll-funded program that employers must register for, fund or insure on top of workers’ compensation.

Connecticut disability and paid leave programs, 2026
Program2026 contributionEmployer’s part
CT Paid Leave0.5% of wages in 2026Employees fund the program. The employer deducts 0.5% from pay and remits it to the CT Paid Leave Authority; contributions stop when the employee reaches the Social Security contribution limit with that employer.⁠4

The Authority's Board voted to keep the rate at 0.5% for 2026.⁠4

Employer health insurance in Connecticut

Average annual premium per enrolled employee at private-sector employers, 2025
MeasureConnecticutFirms under 50United States
Single coverage, total premium$9,987$8,243$9,025
Family coverage, total premium$28,700$23,892$26,281
Employee share, single$1,771–$1,817
Employers offering coverage56.0%40.9%49.2%

Average total annual premium per enrolled employee at private-sector establishments that offer health insurance; the offer rate is the share of establishments offering coverage. Small firms have fewer than 50 employees. Source: Agency for Healthcare Research and Quality (AHRQ), Center for Financing, Access and Cost Trends, 2025 survey year. All states.

Commercial auto in Connecticut

Every vehicle registered in Connecticut, including business vehicles, must carry at least 25/50/25 in liability limits (bodily injury per person / per accident / property damage, in thousands of dollars). Official source.

Section 14-112(a) sets $25,000 per person and $50,000 per accident for bodily injury or death and $25,000 for property damage. Policies must carry at least those limits, and uninsured and underinsured motorist coverage at not less than the same bodily-injury limits.⁠5⁠6

Trucks and buses used in interstate commerce must also meet federal minimums of $750,000 to $5 million: see commercial auto minimums and what commercial auto costs.

Other Connecticut rules that affect insurance costs

No comp means no exclusive-remedy shield

An employer that complies with the insurance or self-insurance requirement is not liable for damage suits over workplace injuries. If it fails to comply, the employee may sue for damages instead, though an employer that in good faith relied on a worker's holding out as an independent contractor is not liable under that provision.⁠3

Principal employer liability for contractors

Under section 31-291, a principal employer that has work done by a contractor or subcontractor, where the work is part of its trade or business and is done on premises it controls, owes compensation as if it had employed the worker directly.⁠3

Misclassification and payroll misstatements

Knowingly treating employees as independent contractors, or giving an insurer false or incomplete information on the number of employees to pay a lower premium, is a class D felony and brings a stop work order from the Labor Commissioner.⁠3

Connecticut compared with its neighbors

Workers’ comp and health insurance costs, Connecticut and neighboring states
Connecticut$0.92$1.48$9,987
Massachusetts$0.65$0.97$10,436
New York$1.12$1.98$10,913
Rhode Island$0.91$1.38$9,388

Sources

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National figures: NASI (employer comp costs), Oregon DCBS (rate index), AHRQ MEPS-IC (health premiums).

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Other states

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