Coverage guide
Workers' compensation for electrical contractors
Workers' compensation is usually the largest insurance cost for an electrical contractor with employees. Understanding how it is priced helps you control it.
What workers' compensation pays
- Medical treatment for work injuries and illnesses
- A portion of lost wages while an employee recovers
- Benefits for permanent impairment
- Death benefits to dependents
- Employer's liability coverage for certain lawsuits tied to work injuries
Common injuries in electrical work
Falls from ladders, lifts, and roofs, electrical shock and arc flash burns, cuts from tools and sheet metal, eye injuries, and strain injuries from pulling wire and carrying materials all show up in electrical contractors' claims. Insurers favor firms that train on lockout/tagout, ladder and lift safety, and personal protective equipment.
How premium is calculated
Premium starts with payroll for each classification divided by 100 and multiplied by that class's rate. The result is then adjusted by your experience modification factor, which compares your losses to businesses of similar size in the same classes, and by any credits or surcharges the insurer applies.
| Factor | Effect |
|---|---|
| Payroll by class | Higher-risk classes carry higher rates |
| Experience modification | Above 1.00 raises premium, below 1.00 lowers it |
| Owner inclusion or exclusion | Including owners adds their payroll |
| Uninsured subcontractors | May be added to your payroll at audit |
| State | Each state sets its own rules and rates |
Classification basics
In states that use the National Council on Compensation Insurance system, electrical wiring within buildings is generally classified as code 5190, with clerical and outside sales staff in separate, lower-rated classes. Pennsylvania uses its own rating bureau, and Washington assigns risk classes through its Department of Labor and Industries. Accurate classification is one of the easiest ways to avoid overpaying.
State differences that matter
- Washington: workers' compensation is provided through the state fund run by the Department of Labor and Industries, not private insurers. Employer's liability (stop gap) coverage is usually bought separately.
- Texas: most private employers may choose not to carry workers' compensation, but those that opt out lose certain legal defenses, and many general contractors require coverage. See the Texas Department of Insurance, Division of Workers' Compensation.
- Pennsylvania: uses its own classification system rather than NCCI. See the Pennsylvania Bureau of Workers' Compensation.
- Other states: each state page on this site links to its workers' compensation agency.
Audits and certificates
Because premium is based on estimated payroll, insurers audit after the policy year. Keep payroll records by class, keep overtime records, and collect a current certificate of insurance from every subcontractor before they start. Missing certificates are among the most common causes of large audit bills.
Request a quote or review general liability for electricians.
Frequently asked questions
Do electricians need workers' compensation?
Most states require it once you have employees, with rules that vary by state and business structure. Texas lets most private employers opt out, and Washington requires coverage through its state fund.
What class code applies to electricians?
In states that use NCCI classifications, electrical wiring within buildings is generally code 5190. Pennsylvania and Washington use their own systems, so codes differ there.
Can I exclude myself as an owner?
Many states let sole proprietors, partners, or certain officers exclude themselves, but the rules differ. Contracts may still require proof of coverage.
More coverage guides
- General liability for electricians
- Workers' compensation for electricians
- Commercial auto for electricians
- Tools & equipment insurance
- License & permit bonds
- Certificates of insurance
Last updated October 15, 2026 · How we research