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Maine business insurance: requirements and costs

Maine requires workers' comp from the first employee, with no headcount threshold, and the Maine Employers' Mutual Insurance Company (MEMIC) is the state's legislatively created comp insurer.⁠1⁠4 The Bureau of Insurance approved an average 9.6% cut in NCCI loss costs for policies starting April 1, 2025.⁠6 Employers also fund a new paid family and medical leave program: contributions began in 2025 and benefits started May 1, 2026.⁠7⁠14

Checked against 15 sources Last reviewed How we check figures

Maine at a glance

Workers’ comp required1+ employees; every private employer, including independent contractors who hire
Where employers buy itPrivate insurers
Rates set byNational Council on Compensation Insurance
Employer comp cost, 2023$1.12 per $100 of covered wages (US $0.98)
Comp rate index, 2024$1.37, ranked 11 of 51 (1 = most expensive)
Employer health premium, 2025$9,803 single, $26,106 family (average total premium)
Auto liability minimum50/100/25
Payroll insurance programsMaine Paid Family and Medical Leave (PFML)

Maine's comp market is private and competitive, with one unusual player. MEMIC was established by statute as an assessable domestic mutual insurer. It must offer comp and incidental employers' liability coverage to employers in the state, yet the statute says it is not a state agency and gets no support from the General Fund.⁠4⁠5 Other licensed insurers also write comp, and employers may self-insure.⁠1 NCCI files advisory loss costs, which are the claims part of a rate, and each insurer adds its own expenses and profit. Loss costs are based on prior experience and projected losses, and the Bureau says some businesses can pay more than the average if their own experience differs.⁠6 The April 1, 2025 decision ranged from -6.5% to -10.7% by industry group.⁠6 For a $20,000 policy that moved exactly at the average, with payroll and experience unchanged, our calculation gives about $18,080, but your class and insurer's expense load decide the real number.

Cost data shows a state that is still above the national figure but narrowing the gap. NASI estimates Maine employers spent $1.12 per $100 of covered wages in 2023, down from $1.28 in 2019, a 12.6% fall by our calculation. The national figure fell 16.3%, from $1.17 to $0.98, so Maine remained about 14% above it in 2023.⁠11 Oregon's 2024 ranking, built from manual rates in effect January 1, 2024, placed Maine 11th most expensive of 51 jurisdictions at an index of $1.37 per $100 of payroll, 125% of the median state.⁠12 That ranking predates the 19% loss-cost cut effective April 1, 2024 and the 9.6% cut in 2025, so it does not reflect them.⁠6⁠15 On health benefits, AHRQ's 2025 survey found 26.3% of Maine private-sector establishments in firms with fewer than 50 employees offered insurance, against 32.1% nationally. Where they did, the average single premium was $9,062, close to the $9,034 small-firm national figure, and the employee share was $1,963 against $1,924.⁠13

Two other rules change what you carry. The first is paid leave. Maine's program is funded by premiums on wages up to the Social Security wage base, and the combined premium may not exceed 1.0% of wages.⁠8 An employer with 15 or more Maine employees remits the full premium and may deduct up to half from employees, so it bears at least half. Smaller employers remit half the premium and the Department of Labor's guidance puts their rate at 0.5% of wages, which they may deduct in whole or part from employees.⁠7⁠8 The second is the penalty for going without comp. The Workers' Compensation Board can assess up to $10,000 or up to 108% of the premium that should have been paid, whichever is larger. For a knowing violation, the employer also commits a Class D crime.⁠2 Because exemptions are narrow and the burden of proving one falls on the employer, check the farm, owner-waiver and contractor rules before you skip coverage.⁠1

Workers’ compensation in Maine

Every private employer, including an independent contractor who hires and pays employees, must secure comp for all employees by buying a policy or self-insuring. There is no minimum headcount.⁠1 An unemployed forest-products harvester who meets the statutory employee definition must insure themselves.⁠1

Who is exempt

  • Employers of domestic service employees⁠1
  • Employers of seasonal or casual agricultural or aquacultural laborers, if they carry employer's liability of at least $25,000 and $5,000 medical payments coverage⁠1
  • Employers of agricultural or aquacultural laborers with 6 or fewer at once (or more than 6 but 240 hours a week or less) and employer's liability of $100,000 times full-time-equivalent laborers plus $5,000 medical payments⁠1
  • Owners of at least 20% of a corporation's voting stock, and professional-corporation shareholders, who waive benefits in writing and are approved by the Board; not available to forest-products harvesters⁠3
  • A parent, spouse, domestic partner or child of a sole proprietor, partner or LLC member may waive benefits in writing if the Board approves; not available to forest-products harvesters⁠3
  • Independent contractors are not employees under the Act⁠3

Buying coverage and who sets the rates

Employers buy from a licensed insurer, including MEMIC, which must offer comp coverage to employers in the state, or self-insure.⁠1⁠4 MEMIC is a mutual, not a state agency.⁠5

Latest rate decision (1 Apr 2025): The Bureau of Insurance approved NCCI's loss costs for new and renewing policies on or after April 1, 2025, an average 9.6% decrease ranging from -6.5% to -10.7% by industry group. Official notice.

Individual and group self-insurance is allowed under 39-A MRSA section 403.⁠1

Penalties for going without

Failing to secure comp lets the Board assess a civil penalty of up to $10,000 or up to 108% of the premium that should have been paid, whichever is larger, calculated on MEMIC's discounted standard premium. A knowing violation is a Class D crime, and the employer may face administrative dissolution or loss of authority to do business in Maine. A knowing violation includes letting prior insurance lapse without a substantial change in operations.⁠2 An uninsured employer loses the statutory defenses and can be sued by the employee or face a comp claim.⁠1

What Maine employers pay

Employer workers’ compensation costs per $100 of covered wages, 2019–2023
YearMaineUnited States
2019$1.28$1.17
2020$1.24$1.08
2021$1.19$1.01
2022$1.15$1.00
2023$1.12$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 Maine’s index for rates in effect on 1 January 2024 at $1.37 per $100 of payroll, 25% above the national median of $1.09 (rank 11 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

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

Maine disability and paid leave programs, 2026
Program2026 contributionEmployer’s part
Maine Paid Family and Medical Leave (PFML)1.0% of wages (15+ Maine employees) or 0.5% (fewer than 15), up to the Social Security wage base⁠7⁠815+ employees: remit the full premium and may deduct up to half from employees. Under 15: remit half the premium; guidance says the 0.5% may be deducted in whole or in part from employees.⁠7⁠8

Contributions began January 1, 2025. Benefits are paid for leave on or after May 1, 2026.⁠14

Employer health insurance in Maine

Average annual premium per enrolled employee at private-sector employers, 2025
MeasureMaineFirms under 50United States
Single coverage, total premium$9,803$9,062$9,025
Family coverage, total premium$26,106$22,577$26,281
Employee share, single$1,869–$1,817
Employers offering coverage42.8%26.3%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 Maine

Every vehicle registered in Maine, including business vehicles, must carry at least 50/100/25 in liability limits (bodily injury per person / per accident / property damage, in thousands of dollars). Official source.

Registered vehicles need $50,000 per person and $100,000 per accident bodily injury, $25,000 property damage, $2,000 medical payments and $500 towing and storage.⁠9 The medical payments requirement does not apply to a policy insuring more than 4 motor vehicles, which matters for fleets.⁠10 No 2025-2026 change was found in the statute.

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 Maine rules that affect insurance costs

Farm and aquaculture employers can substitute liability cover

Maine lets agricultural and aquacultural employers skip comp for seasonal or casual laborers if they carry employer's liability of at least $25,000 and $5,000 medical payments. Others with 6 or fewer concurrent laborers must carry $100,000 per full-time-equivalent laborer plus $5,000 medical payments. Immediate family of unincorporated employers and of 20% corporate owners are not counted as laborers.⁠1

Forest-products harvesters

A harvester who is not employed by a private employer must insure themselves if they meet the Act's employee definition. A person who contracts directly with the landowner and meets the criteria for a certificate of independent status can fall outside it.⁠1⁠3

MEMIC's premium sets the penalty base

The civil penalty for going uninsured is figured from MEMIC's discounted standard premium, so the exposure scales with your payroll and class rather than a flat fine, and can reach 108% of that premium.⁠2

Maine compared with its neighbors

Workers’ comp and health insurance costs, Maine and neighboring states
Maine$1.12$1.37$9,803
New Hampshire$0.76$1.22$9,502

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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