Texas is the only state where workers comp is optional. That is not the same as safe.
Texas employers can legally go without workers compensation. Non-subscribers give up the exclusive remedy protection that comp provides, which means an injured employee can sue you directly for negligence – with no cap and with common-law defenses stripped away.
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What this coverage includes
- Medical costs for a work-related injury or illness
- Lost wage replacement while an employee recovers
- Employer liability protection (exclusive remedy)
- Death and survivor benefits
- Coverage for employees traveling between job sites
Subscriber vs non-subscriber
As a subscriber you carry workers comp, and an injured employee’s remedy is the comp benefit. As a non-subscriber you must notify employees and file annually with the Texas Department of Insurance, and you lose the defenses of contributory negligence, assumption of risk and fellow-servant.
Some employers self-fund an occupational injury plan instead. Those plans can work, but they need real excess coverage behind them and they do not restore exclusive remedy.
What drives your premium
Payroll by class code, your experience modifier, and claims history. Misclassified payroll is the most common reason a Texas business overpays – we audit class codes before we shop the policy.
Contractors and certificate requirements
Most general contractors and many commercial clients will not let you on site without a comp certificate, whether or not the state requires it. If you are bidding work, comp is effectively mandatory. We issue certificates the same day.
Class codes and the experience modifier
Your premium is payroll multiplied by a rate per class code, adjusted by your experience modifier. Getting a single employee into the wrong class code – a clerical worker rated as field labor – can cost thousands a year.
We audit class codes before marketing the policy, and we check the mod worksheet for closed claims still being carried as open reserves, which inflates the mod long after the claim is done.
Texas employers also have the option of a certified self-insurance or an occupational injury plan. Those can lower cost for the right business, but they need excess coverage and clear plan documents, and they do not restore exclusive remedy protection.
If you use subcontractors, ask for their certificates and keep them. Uninsured subs get added to your payroll at audit and produce a surprise premium bill.
Frequently asked questions
Do I need workers comp for one employee in Texas?
Not by state law, but you carry full liability exposure without it, and most contracts require it.
Are owners and officers covered?
They can be included or excluded. Excluding yourself lowers premium but leaves your own injuries to your health plan.
Can I get comp and general liability together?
Yes – see general liability and business insurance.
Get a workers comp quote
BenefitExcel is an independent agency in Corpus Christi. We shop multiple carriers on your behalf instead of selling one company’s product, and we review every renewal so you are not quietly paying more each year. Request a quote or call (361) 808-4988.