Popular QuestionsPopular Questions about Tennessee Workers’ Compensation Insurance

Why do I need workers’ compensation insurance for my Tennessee business?

If an employee is injured in the workplace, the costs for necessary medical treatment and lost wages can add up quickly. Workers’ compensation insurance protects both your business and your employees by offering benefits to injured workers while reducing the chance that your business will need to deal with expensive lawsuits. 

What are the workers’ compensation laws in Tennessee?

In Tennessee, every employer in the construction and coal mining business must carry workers’ compensation for all workers, including subcontractors. 

All other businesses are required by law to have workers' compensation if they employ five or more workers. Family members, part-time employees, and corporate officers must be included when determining the number of employees.

It is not necessary to purchase coverage for sole proprietors, LLC members, corporate officers, or partners. However, you may buy coverage for these workers if you wish.

Where can I purchase Tennessee workers’ compensation insurance?

In Tennessee, a workers’ compensation policy can be purchased through any of a number of commercial insurance companies that offer this coverage. 

These companies must adhere to the rates for each job classification that are published annually by the Workers’ Compensation Division of the Tennessee Department of Labor and Workforce Development. Because commercial providers are permitted by the state to offer policy discounts of up to 25%, comparing rates can save you money.

Additionally, Tennessee businesses are given the option to self-insure. To do so, a company must demonstrate the financial strength necessary to self-insure, and must obtain approval from the Tennessee Department of Commerce and Insurance.

What will workers’ compensation insurance pay for in Tennessee?

Medical bills

  • Example: A worker at your roofing company falls while tacking shingles and requires urgent medical attention.
  • Employees are allowed to receive necessary urgent and follow-up treatment from any of three medical providers authorized by your company for any injuries or work-related illnesses they suffer in the course of doing their jobs.

Wage replacement

  • Example: Your employee’s doctor determines that 6 weeks of recovery time is necessary following a back injury at your company warehouse.
  • Injured workers who are totally or partially disabled and unable to work for more than seven days can receive cash benefits (wage replacement) of 2/3 their average income.

Death benefits

  • Example: A construction work suffers a fatal injury after falling from a scaffold. 
  • If a worker dies from a work-related injury, their surviving spouse and/or minor children can receive weekly cash benefits equal to 1/2 of the deceased worker's average weekly wage for the year before the accident. Workers' compensation will also pay up to $10,000 in burial expenses.

Mileage reimbursement

  • Example: A worker at your manufacturing plant suffers a rare lung disease after inhaling toxic fumes at the worksite. He requires the care of a specialist who is located 25 miles away.
  • If an employee must travel more than 15 miles one way to receive necessary treatment or follow-up care, workers’ compensation will cover traveling expenses.
How are workers’ compensation insurance premiums calculated in Tennessee?

In this state, workers’ compensation premiums are calculated according to how many employees a business has, the types of jobs these workers do, the company’s overall annual payroll, and the employer’s history of accidents and workers’ compensation claims. 

In general, if you have workers who do jobs that involve higher risks of suffering serious injuries, you can expect to pay more for workers’ compensation insurance for them in Tennessee.

Every year, the Workers’ Compensation Division of the Tennessee Department of Labor and Workforce Development publishes assigned rates for every job classification. Insurance companies must adhere to these rates when determining costs, though they are permitted to offer policy discounts when appropriate.

Information needed first

Classification code: Every occupation is assigned a specific classification code. You would need to find the classification codes for all the jobs your employees do.

Base rate: The Tennessee Workers’ Compensation Division assigns base rates for each of these class codes according to the overall injury risks associated with these jobs. 

The base rate is used as part of a formula that determines an employer’s annual workers’ compensation premium. 

Example Based on $100,000 in annual payroll

  • Classification Code 8829: Nursing Home Employees
  • Base rate: $2.37
  • Premium calculation: Base rate X (Payroll/100)
  • $100,000/100 = $1,000 X $2.98 = $2,370.
  • $2,370 = Estimated annual workers' compensation premium for Tennessee nursing home workers.

Established employers can get lower rates if they have a solid safety rating. This is known as an experience modifier-based discount.

How do experience modifiers affect Tennessee workers’ compensation rates?

An experience modification factor, or experience mod, is an additional factor that may be applied to your workers’ compensation premium calculation. It increases or decreases your workers’ compensation premium for a given year, depending on your company’s claims history.

Your experience modification is a numerical representation of your actual losses compared with expected losses for businesses in your industry (roofing companies are compared with other roofing companies; restaurants are compared with other similar-style restaurants, etc.) 

The mod is applied to the Tennessee workers’ compensation premium as a debit or credit. 

  • Average mod: 1.0 = Does not impact your premium
  • Debit mod: Greater than 1.0 = Premium goes up
  • Credit mod: Less than 1.0 = Premium goes down

Experience-rated premium calculation:

  • Base rate X (Payroll/100) X Mod = Premium

Tennessee employers are eligible to receive an experience modification rating (EMR) when they meet one of the following requirements: 

  • $9,000 in policy premium generated during the last year or last two years; or
  • $4,500 average policy premium generated for more than two years.
How do I find the best workers’ compensation insurance in Tennessee?

Are you looking for a great workers’ compensation insurance policy to cover your Tennessee business? An independent insurance agent can help. These agents can help you review rates and offerings from a variety of insurance companies so that you can choose the coverage that offers the most value to your company.

Your local agent can also help you evaluate your risk management techniques and find new programs and solutions to keep your workers’ compensation insurance costs down over the long term.

  • There are 366 independent agents in Tennessee who are ready to help. 
  • These agents have helped more than 2,500 people in Tennessee. 

InformationFind the Best Insurance in Your City


How Does Your Company Measure Up?

Average Cost Range per $50,000 in Payroll

Clerical WorkersRetail Store WorkersHotel EmployeesAuto shop workersShort Haul TruckersCarpenters
$55 to $95$455 to $775$810 to $1,375$890 to $1,515$2,265 to $3,850$2,430 to $4,130

Nashville, TN Workers’ Compensation Insurance

How does having a business in Nashville affect my workers’ compensation cost? 

If you own a business in this capital city, you will need to adhere to Tennessee’s laws regarding workers' compensation insurance. Rates in this state are assigned according to job classifications and are regulated by the Tennessee Department of Labor and Workforce Development, Workers’ Compensation Division.

The more hazardous the work your employees do, the higher your rates are likely to be. The best way to keep your workers’ compensation rates in check is to provide your employees with a safe and healthy workplace. A solid safety history can earn you policy discounts of up to 25%.

Now, let’s take a peek at the three most common business industries in Nashville, and see what the average annual workers’ compensation cost would be (based on a $100,000 payroll).

  • Construction: $10,847 per year
  • Retail Trade: $1,230 per year
  • Professional, Scientific and Technical Services: $190 per year

Construction companies often pay much more for workers’ compensation coverage than most other employers. That is because construction workers are at increased risk for falls, serious injuries, and fatalities while at work. Retail and technical services workers can also be injured at work, but injuries are much less common and often much less severe. 

An independent insurance agent who understands the coverage needs of businesses in your industry can help guide you through the process of finding the best workers’ compensation coverage. 

Memphis, TN Workers’ Compensation Insurance

How does having a business in Memphis affect my workers’ compensation cost? 

The industry your business operates in, the number of workers you employ, and your company’s annual payroll all play a role in how much you will pay for Memphis workers’ compensation insurance. Tennessee sets its own workers’ comp base rates, which take into account the risk of injury in various job classifications. 

The best way to reduce the number of workers’ compensation claims filed by employees of your Memphis business is to provide a safe and healthy workplace. You can reduce on-the-job injuries and illnesses by implementing effective risk management programs and making employee safety a top priority.

Let’s take a peek at the three most common business industries in Memphis, and see what the average annual workers’ compensation cost is (based on a $100,000 payroll):

  • Transportation & Warehousing: $6,115 per year
  • Manufacturing: $4,510 per year
  • Retail Trade: $1,230 per year

While accidents can happen at any job, transportation and warehousing workers have high injury rates. Retail workers suffer fewer and less-severe injuries, so they are much less expensive to insure.

Employers in Memphis can obtain workers’ compensation insurance quotes and learn more about this important coverage by speaking with a local independent agent.

Knoxville, TN Workers’ Compensation Insurance

How does having a business in Knoxville affect my workers’ compensation cost? 

In Knoxville, your workers’ compensation premium is based mainly on the risk of employee injuries in your business industry and your company’s annual payroll. Every year, the Tennessee Department of Labor and Workforce Development, Workers’ Compensation Division, publishes rates for the various job classifications that commercial insurers must adhere to.

As an employer in Knoxville, you will want to find ways to limit worker injuries. The best way to reduce the number of workers’ compensation claims is to provide a safe workplace for your employees. Insurance companies that specialize in your business industry will often offer guidelines for employee safety.

Now, let’s look at the three most common business industries in Knoxville, and see what the average annual workers’ compensation cost is (based on a $100,000 payroll):

  • Retail Trade: $1,230 per year
  • Accommodation & Food Services: $1,620 per year
  • Educational Services: $535 per year

The most common business industries in Knoxville are also some of the safest. Of course, there are a number of other business types in this city, and companies operating in more injury-prone industries, such as construction and transportation, can expect to pay much higher rates than those shown above.

Talk to a local independent insurance agent for help finding the best workers’ compensation policy to cover your Knoxville business.

Chattanooga, TN Workers’ Compensation Insurance

How does having a business in Chattanooga affect my workers’ compensation cost? 

If you own a business in Chattanooga, you will need to observe Tennessee’s laws regarding workers' compensation insurance. Rates in this state are assigned according to job classifications and are regulated by the Tennessee Department of Labor and Workforce Development, Workers’ Compensation Division.

The more dangerous the work your employees do, the higher your rates are likely to be. The best way to keep your workers’ compensation rates in check is to provide your employees with a safe and healthy workplace. A good safety history can earn you discounts of up to 25% on your workers’ compensation premiums.

Now, let’s take a peek at the three most common business industries in Chattanooga, and see what the average annual workers’ compensation cost is (based on a $100,000 payroll).

  • Manufacturing: $4,510 per year
  • Retail Trade: $1,230 per year
  • Accommodation & Food Service: $1,620 per year

In general, employees at manufacturing plants are more likely to suffer serious injuries than workers at retail stores, hotels, and restaurants. Of course, some types of manufacturing are more hazardous than others, so if you own a business in this industry, your rates will be based on what products your company produces.

To make sure you purchase the right policy for your Chattanooga business, seek the advice and assistance of a local independent insurance agent.

Murfreesboro, TN Workers’ Compensation Insurance

How does having a business in Murfreesboro affect my workers’ compensation cost? 

For businesses operating in Murfreesboro, workers’ compensation is required of those in the construction and coal mining fields, as well as all other employers who have five or more workers. Every year, the Workers’ Compensation Division of the Tennessee Department of Labor and Workforce Development publishes rates for various job classifications.

As an employer in Murfreesboro, you will want to find ways to limit worker injuries and keep your workers’ compensation rates affordable. The best way to do this is to provide a safe and healthy workplace for your employees. Insurance companies that specialize in covering businesses in your industry will often offer policyholders guidelines for employee safety.

Now, let’s look at the three most common business industries in Murfreesboro, and see what the average annual workers’ compensation cost is (based on a $100,000 payroll):

  • Retail Trade: $1,230 per year
  • Manufacturing: $4,510 per year
  • Accommodation & Food Service: $1,620 per year

Assigned rates take into account that workers at manufacturing plants are more likely to suffer serious injuries than workers at retail stores, hotels, and restaurants. Of course, some products are more hazardous to produce than others. Therefore, if you own a manufacturing firm in Murfreesboro, your rates will be based on what, specifically, your business produces.

If you would like to purchase workers’ compensation insurance for your Murfreesboro business, contact an independent agent near you for help finding a suitable policy at a competitive price.