District of Columbia business insurance: requirements and costs

The District of Columbia requires workers' comp from an employer's first employee, and private insurers or self-insurers carry it; there is no state fund.⁠¹⁠³ The statute puts paid family leave contributions on the employer, at 0.75% of each covered employee's wages.⁠⁵⁠⁶ Official cost data put DC among the cheapest places to insure comp: NASI measured $0.33 per $100 of covered wages in 2023, a third of the national $0.98.⁠¹⁰

Checked against 12 sources Last reviewed 13 Oct 2026 How we check figures

District of Columbia at a glance

Workers’ comp required	1+ employees; contractors liable for subs' employees
Where employers buy it	Private insurers
Rates set by	National Council on Compensation Insurance
Employer comp cost, 2023	$0.33 per $100 of covered wages (US $0.98)
Comp rate index, 2024	$0.73, ranked 43 of 51 (1 = most expensive)
Employer health premium, 2025	$9,762 single, $29,371 family (average total premium)
Auto liability minimum	25/50/10
Payroll insurance programs	DC Universal Paid Leave (Paid Family Leave)

DC applies its workers' comp law to any individual, firm, association or corporation "using the service of another for pay" in the District, so there is no headcount threshold.⁠³ An employer must either insure with a carrier the Mayor has authorized or satisfy the Mayor of its financial ability and receive authorization to self-insure, and the Mayor may require a bond or securities as a condition.⁠¹ The Department of Employment Services (DOES) runs the program, handles claims and monitors employers' compliance, and its policy documents refer to a Special Fund under a designated custodian.⁠⁹

By the official measures, DC comp is inexpensive and getting cheaper. NASI estimates employers spent $0.4797 per $100 of covered wages in 2019 and $0.3271 in 2023; by our calculation that is a 31.8% drop, against 16.3% nationally ($1.1741 to $0.983).⁠¹⁰ Oregon's 2024 ranking, built from manual rates in effect January 1, 2024, put DC 43rd of 51 jurisdictions at an index of $0.73 per $100 of payroll, 67% of the median state's $1.09, level with Virginia ($0.73) and below Maryland ($0.89, rank 37).⁠¹¹ These measure different things (actual employer cost versus manual rates for a fixed class mix), but both put DC well below the median. Health coverage runs the other way on availability: AHRQ's 2025 survey found 58.6% of DC private-sector establishments in firms under 50 employees offered insurance, against 32.1% nationally, at an average single premium of $9,252 versus $9,034 (our calculation: 2.4% higher).⁠¹²

Two other costs set DC apart from most states. First, paid family leave is funded by an employer contribution: a covered employer must contribute 0.75% of each covered employee's wages to the District.⁠⁶ A covered employee spends more than 50% of work time in DC, or is based in DC and spends the rest of the time elsewhere; the United States and the District itself are not covered employers.⁠⁵ On $1,000,000 of covered payroll, our calculation gives $7,500 a year. Second, the auto minimums will rise. The Motor Vehicle Insurance Modernization Amendment Act of 2026 lifts the private passenger floors from 25/50/10 to 50/100/20 as of October 1, 2027, so renewals of fleets garaged in DC should be priced against the new limits.⁠⁷⁠⁸

For an employer the practical points are the contractor chain and the uninsured penalty. A general contractor must secure comp for a subcontractor's employees unless the subcontractor has secured it, so collect proof of coverage before work starts.⁠⁴ An employer that fails to insure faces a civil fine of $1,000 to $10,000, and a corporation's president, secretary and treasurer are each personally liable with it for benefits owed for injuries during the lapse.⁠²

Workers’ compensation in District of Columbia

Every employer using another's services for pay in DC must secure comp; no minimum headcount applies.⁠¹⁠³ Casual employees are outside the law, and an out-of-state employer whose employee is only temporarily or intermittently in DC is exempt if its home-state policy covers that work.⁠⁴

Who is exempt

Casual employees (the law does not apply to them)
Federal employees covered by FECA and other federal programs listed in § 32-1501
Household domestic workers, unless the employer used one or more for 240 hours or more in a calendar quarter
Licensed real estate salespersons and associated brokers paid substantially by commission under a written independent-contractor contract
Nonresident employers whose employees are temporarily or intermittently in DC and covered under their home state's comp law

Buying coverage and who sets the rates

Employers insure with a carrier authorized by the Mayor, or self-insure with the Mayor's authorization.⁠¹ There is no state fund.

An employer may furnish satisfactory proof of financial ability to the Mayor and receive authorization to pay compensation directly; the Mayor may require an indemnity bond or securities.⁠¹

Penalties for going without

A civil fine of not less than $1,000 and not more than $10,000. If the employer is a corporation, its president, secretary and treasurer are also severally liable for the fine and personally liable, jointly with the corporation, for benefits on injuries during the lapse.⁠² Concealing or disposing of property to avoid paying an injured employee is a misdemeanor, with a fine of $1,000 to $10,000, up to one year in jail, or both.⁠²

What District of Columbia employers pay

Employer workers’ compensation costs per $100 of covered wages, 2019–2023
Year	District of Columbia	United States
2019	$0.48	$1.17
2020	$0.40	$1.08
2021	$0.35	$1.01
2022	$0.34	$1.00
2023	$0.33	$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 District of Columbia’s index for rates in effect on 1 January 2024 at $0.73 per $100 of payroll, 33% below the national median of $1.09 (rank 43 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

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

District of Columbia disability and paid leave programs, 2026
Program	2026 contribution	Employer’s part
DC Universal Paid Leave (Paid Family Leave)	0.75% of each covered employee's wages	The statute requires the covered employer to contribute the 0.75% to the District.⁠⁶ Covered employees are those who spend more than 50% of work time in DC, or are based in DC with the remainder elsewhere.⁠⁵ Covered employers are those required to pay DC unemployment insurance; the United States and the District are excluded.⁠⁵

Self-employed individuals can opt in and pay 0.75% of self-employment income.⁠⁶

Employer health insurance in District of Columbia

Average annual premium per enrolled employee at private-sector employers, 2025
Measure	District of Columbia	Firms under 50	United States
Single coverage, total premium	$9,762	$9,252	$9,025
Family coverage, total premium	$29,371	$26,474	$26,281
Employee share, single	$1,863	–	$1,817
Employers offering coverage	72.4%	58.6%	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 District of Columbia

Every vehicle registered in District of Columbia, including business vehicles, must carry at least 25/50/10 in liability limits (bodily injury per person / per accident / property damage, in thousands of dollars). Official source.

Private passenger floors in § 31-2406 are $25,000 per person and $50,000 per accident for bodily injury and $10,000 property damage. Law 26-155 raises them to 50/100/20 as of October 1, 2027. Insurers must also include uninsured-motorist coverage of $25,000/$50,000 bodily injury and $5,000 property damage. § 31-2406 states these minimums without a separate commercial-vehicle figure.⁠⁷⁠⁸

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 District of Columbia rules that affect insurance costs

Contractors answer for subs' employees

If a subcontractor has not secured comp, the contractor is liable for and must secure it for the subcontractor's employees.⁠⁴

Out-of-state employers working in DC

A nonresident employer whose employee was hired in another state and is only temporarily or intermittently in DC is exempt if it has comp coverage under the other state's law covering that work. An injured worker may still claim in DC, and any DC award is reduced by comp received elsewhere.⁠⁴

Auto limits rise October 1, 2027

Law 26-155 doubles the private passenger property damage minimum to $20,000 and the bodily injury minimums to $50,000/$100,000. From January 1, 2037 and every ten years after, the floors rise by $5,000 per person, $10,000 per accident and $2,000 property damage.⁠⁸

District of Columbia compared with its neighbors

Workers’ comp and health insurance costs, District of Columbia and neighboring states

District of Columbia	$0.33	$0.73	$9,762
Maryland	$0.74	$0.89	$8,760
Virginia	$0.48	$0.73	$8,970

Sources

1
Council of the District of Columbia, D.C. Code § 32-1534 (security for payment of compensation) Checked 13 Oct 2026 · Back to text ↑
2
Council of the District of Columbia, D.C. Code § 32-1539 (failure to secure payment of compensation) Checked 13 Oct 2026 · Back to text ↑
3
Council of the District of Columbia, D.C. Code § 32-1501 (definitions: employer, employee) Checked 13 Oct 2026 · Back to text ↑
4
Council of the District of Columbia, D.C. Code § 32-1503 (coverage; contractors and subcontractors) Checked 13 Oct 2026 · Back to text ↑
5
Council of the District of Columbia, D.C. Code § 32-541.01 (Universal Paid Leave definitions) Checked 13 Oct 2026 · Back to text ↑
6
Council of the District of Columbia, D.C. Code § 32-541.03 (contributions to the Universal Paid Leave Fund) Checked 13 Oct 2026 · Back to text ↑
7
Council of the District of Columbia, D.C. Code § 31-2406 (required and optional motor vehicle insurance) Checked 13 Oct 2026 · Back to text ↑
8
Council of the District of Columbia, D.C. Law 26-155, Motor Vehicle Insurance Modernization Amendment Act of 2026 Checked 13 Oct 2026 · Back to text ↑
9
D.C. Department of Employment Services, Workers' Compensation - DOES Checked 13 Oct 2026 · Back to text ↑
10
National Academy of Social Insurance, Workers' Compensation: Benefits, Costs, and Coverage, 2023 Data Checked 13 Oct 2026 · Back to text ↑
11
Oregon Department of Consumer and Business Services, 2024 Oregon Workers' Compensation Premium Rate Ranking Checked 13 Oct 2026 · Back to text ↑
12
Agency for Healthcare Research and Quality, MEPS-IC 2025 private-sector data by state Checked 13 Oct 2026 · Back to text ↑

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

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