Short answer: most California businesses with no employees don’t need workers compensation. Contractors licensed by the Contractors State License Board (CSLB) are the exception: some trades already must carry it, and starting January 1, 2028, every licensed contractor must.
Get a workers comp quote or call 888-391-5981.
The general rule: your first employee
California requires every employer to carry workers compensation, starting with the first employee. That includes part-time workers, and it usually includes family members you pay. A worker you call an independent contractor can still count as an employee under California law, so be careful before you rely on 1099s.
Owners, partners and LLC members
Sole proprietors with no employees aren’t required to cover themselves. Partners and LLC members are generally treated as owners, too. Corporate officers and directors who own the business can often be excluded from a policy, but the rules are specific, so ask before you assume you’re exempt. Some owners choose to cover themselves anyway, because health insurance may not pay for an on-the-job injury.
Contractors: the exception
- Since 2023: concrete (C-8), HVAC (C-20), asbestos abatement (C-22), roofing (C-39) and tree service (D-49) licensees must carry workers comp even with no employees.
- From January 1, 2028: all CSLB licensees must carry it, under SB 216 as amended by SB 1455. The exemption most small contractors use today goes away. Read our 2028 guide.
When a client requires it anyway
Even when the law doesn’t require it, general contractors, property managers and public agencies often won’t let you on the job without a workers comp certificate, frequently with a waiver of subrogation. If you keep getting asked, a small policy may cost less than the work you’re losing.
What it costs
Price depends on your trade classification, payroll (including how owner payroll is counted), your claims history and the carrier. Some carriers charge a minimum premium for very small policies, so compare. We quote State Fund and private carriers side by side.
Related: Workers compensation · Client case studies · All articles
Frequently asked questions
Does a sole proprietor need workers comp in California?
Not usually, unless you have employees or you hold a CSLB license in a trade that requires it. From January 1, 2028, every licensed contractor needs it.
Do 1099 workers count as employees?
They might. California uses a strict test, and many workers paid on a 1099 are legally employees. If they are, you need workers comp for them.
Can I buy workers comp just for myself?
Yes. Many carriers will cover an owner who elects coverage. We can quote it.