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Virginia business insurance: requirements and costs

Virginia requires workers' compensation once an employer regularly has three or more employees in the same business in the state.⁠1 Virginia has no state comp fund, and the auto liability minimum rose to 50/100/25 for policies effective January 1, 2025.⁠5⁠7 The National Academy of Social Insurance (NASI) estimates Virginia employers paid $0.48 per $100 of covered wages for comp in 2023, less than half the national $0.98.⁠8

Checked against 10 sources Last reviewed How we check figures

Virginia at a glance

Workers’ comp required3+ employees regularly in service; sole owners and partners may elect
Where employers buy itPrivate insurers
Rates set byNational Council on Compensation Insurance
Employer comp cost, 2023$0.48 per $100 of covered wages (US $0.98)
Comp rate index, 2024$0.73, ranked 44 of 51 (1 = most expensive)
Employer health premium, 2025$8,970 single, $27,257 family (average total premium)
Auto liability minimum50/100/25

Virginia comp is bought from private insurers. Under § 65.2-801 an employer can insure with an authorized insurer, get an individual self-insurance certificate from the Workers' Compensation Commission, or join a group self-insurance association.⁠2 The State Corporation Commission's Bureau of Insurance posts the assigned-risk rates, published by NCCI and dated by effective date (the latest on its page takes effect April 1, 2026), along with a loss cost multiplier document. The Bureau notes that the rate documents are copyrighted NCCI publications.⁠4 We have not reproduced those schedules, and we could not open an official order for the April 1, 2026 change, so this page states no percentage for it. Check the effective-date list on the Bureau's page and ask your carrier for its multiplier and your class code.

Virginia employers are among the cheaper payers in two independent datasets. NASI's estimate fell from $0.69 per $100 of covered wages in 2019 to $0.48 in 2023, a 30.7% drop by our calculation, while the national figure went from $1.17 to $0.98.⁠8 Oregon's 2024 ranking, built from manual rates in effect January 1, 2024, puts Virginia 44th of 51 jurisdictions at an index of $0.73 per $100 of payroll, 67% of the median.⁠9 That is below North Carolina ($0.95, 33rd) and Maryland ($0.89, 37th) but above West Virginia ($0.54, 49th).⁠9 Health coverage is less common among small employers: AHRQ's 2025 survey found 37.2% of Virginia private-sector establishments in firms with fewer than 50 employees offered insurance, against 32.1% nationally. Where offered, their average single premium was $8,141, about 9.9% below the $9,034 small-firm national figure by our calculation, and the employee share averaged $1,763 against $1,924.⁠10

The threshold and the officer rules matter more here than rate tables. A business with fewer than three regular employees is outside the Act unless it elects in, and sole proprietors, one-shareholder corporations, one-member LLCs and partners are covered only if they elect and notify the insurer.⁠1 Executive officers can reject coverage, and an unpaid officer who does so does not count toward the three-employee test.⁠1 Once you are covered, the exclusive-remedy protection depends on keeping the policy in force: an uninsured employer cannot defend an injury suit on the grounds that the employee was negligent, and owes up to $250 a day, capped at $50,000, with a possible order to cease all business operations.⁠3 For auto, Virginia ended the uninsured motor vehicle fee on July 1, 2024, so every registered vehicle must be insured, and the limits for policies effective on or after January 1, 2025 are $50,000 per person, $100,000 per accident and $25,000 property damage.⁠5⁠6⁠7

Workers’ compensation in Virginia

Employers that regularly have three or more employees in the same business in Virginia must carry comp. Underground coal mine operators are covered regardless of size.⁠1 Employers below the threshold may elect to be bound.⁠1

Who is exempt

  • Employers regularly employing fewer than three employees in the same business in Virginia (they may elect coverage; not available to underground coal mine operators)
  • Casual employees and domestic servants
  • Farm and horticultural laborers, unless the employer regularly has more than three full-time employees
  • Taxicab or executive sedan drivers who are excluded from federal unemployment tax
  • Sole proprietors, single-shareholder corporations, single-member LLCs and partners are included only if they elect and notify the insurer
  • Executive officers may reject coverage under § 65.2-300; an unpaid officer who rejects is not counted toward the three-employee threshold

Buying coverage and who sets the rates

Buy a policy from an insurer authorized to write comp in Virginia, obtain an individual self-insurance certificate from the Workers' Compensation Commission, or join a licensed group self-insurance association.⁠2 There is no state fund. The State Corporation Commission posts NCCI assigned-risk rates for employers that cannot find voluntary coverage.⁠4

Individual employers need a certificate from the Workers' Compensation Commission under § 65.2-808; group self-insurance associations are also permitted under § 65.2-801.⁠2

Penalties for going without

A civil penalty of up to $250 a day of noncompliance, capped at $50,000. The uninsured employer is liable for compensation or for damages at law and cannot plead employee negligence and similar defenses. After 15 days' written notice the Commission may order the business to cease all business transactions until it complies.⁠3

What Virginia employers pay

Employer workers’ compensation costs per $100 of covered wages, 2019–2023
YearVirginiaUnited States
2019$0.69$1.17
2020$0.61$1.08
2021$0.56$1.01
2022$0.53$1.00
2023$0.48$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 Virginia’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 44 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.

Employer health insurance in Virginia

Average annual premium per enrolled employee at private-sector employers, 2025
MeasureVirginiaFirms under 50United States
Single coverage, total premium$8,970$8,141$9,025
Family coverage, total premium$27,257$19,835$26,281
Employee share, single$2,054–$1,817
Employers offering coverage57.7%37.2%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 Virginia

Every vehicle registered in Virginia, 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.

Minimum liability for policies effective on or after January 1, 2025 is $50,000 per person, $100,000 per accident and $25,000 property damage, up from 30/60/20 for 2022 through 2024.⁠5⁠7 Since July 1, 2024 the uninsured motor vehicle fee option is gone and every registered vehicle must be insured.⁠6 Uninsured owners lose driving and registration privileges and must pay a $600 non-compliance fee and file an SR-22 for three years to be reinstated. Self-insurance and surety bonds are special options for owners of business vehicles.⁠5

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 Virginia rules that affect insurance costs

Officers and owners decide their own comp status

A sole proprietor, one-shareholder corporation, one-member LLC or partnership is outside the comp system unless it elects in and tells its insurer.⁠1 Executive officers may reject coverage, but § 65.2-101 excludes from the three-employee count only an unpaid officer who rejects, so a salaried officer who rejects can still count toward the threshold.⁠1

Auto: the uninsured fee is gone

The Department of Motor Vehicles stopped collecting the Uninsured Motor Vehicle fee on July 1, 2024. Every registered vehicle must now carry insurance meeting Virginia's limits, and the January 1, 2025 increase raised the bodily injury floor to $50,000 per person.⁠5⁠6⁠7

Virginia compared with its neighbors

Workers’ comp and health insurance costs, Virginia and neighboring states
Virginia$0.48$0.73$8,970
Maryland$0.74$0.89$8,760
North Carolina$0.62$0.95$8,612
Tennessee$0.60$0.80$8,667
Kentucky$0.73$0.76$8,936
West Virginia$1.05$0.54$8,878
District of Columbia$0.33$0.73$9,762

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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