Texas Workers' Comp Rate Calculator

Workers' comp in Texas: what's different

Coverage is a choice for most private employers

In Texas, most private employers can choose whether to carry workers' comp. Public employers do not have this option. A private employer that does not carry it is known as a non-subscriber.

Texas does not have a state fund that employers must buy from. By law, coverage comes from a licensed insurance company or through self-insurance.

What a non-subscriber gives up

If an employee sues a non-subscriber over a work injury, the employer cannot defend by saying:

• the employee was contributorily negligent;
• the employee assumed the risk; or
• a fellow employee caused the injury.

The employee must still prove the employer was negligent. The employer may defend by claiming the employee intended the injury or was intoxicated.

With coverage, TDI states that the policy limits the employer's liability if an employee sues, except when gross negligence leads to a death.

Non-subscriber duties

• Annual notice to DWC. File DWC Form-005 between February 1 and April 30 each year. Also file within 30 days of hiring your first employee, and within 10 days of ending a policy. You do not have to file if all your employees are exempt from coverage, such as certain domestic or farm and ranch workers.
• Notice to employees. Post Notice 5 where employees regularly see it, in English, Spanish, and other languages as needed. Give new hires written notice of no coverage.
• Injury reports. If you have five or more employees who are not exempt, report to DWC on Form-007 each injury that keeps an employee off work more than one day, each work-related illness you know of, and each death. The report is due by the 7th day of the month after the month the event occurred or became known.

Failing to file or notify is an administrative violation under Texas law. The maximum administrative penalty is capped at $25,000 per day per occurrence.

When coverage is required

• Public employers. The law lets employers elect coverage "except for public employers."
• Public construction. A governmental entity that signs a building or construction contract must require the contractor to certify in writing that it covers each employee on the project. Each subcontractor must give the same certificate.

Duties if you carry coverage

• Post Notice 6 (insurance company), Notice 7 (certified self-insurer), or Notice 10 (self-insurance group).
• Tell new hires about your coverage and their right to reject it in writing and keep their common law rights.
• Notify employees within 15 days if coverage starts, ends, or is cancelled.
• Report an injury to your carrier on DWC Form-001 no later than the 8th day after the employee misses more than one day of work, or after you receive notice of an occupational disease. Give the employee a copy.

Where coverage comes from

• Licensed insurance companies. TDI licenses many companies to sell workers' comp policies.
• Texas Mutual Insurance Company. By statute it is the insurer of last resort. It may not refuse a risk that pays the required premium and any accident prevention fee, though it can charge a higher premium.
• Certified self-insurance. TDI says an applicant generally needs at least $500,000 in total unmodified workers' comp premium, a security deposit, and a $1,000 application fee.
• Self-insurance groups of similar employers, certified by TDI.

How rates are set

Each insurer sets and files its own rates with TDI. The state does not set one rate. For policies effective on or after July 1, 2026, insurers must base rates on NCCI advisory loss costs effective July 1, 2026, or on their own classification relativities. TDI says that filing averaged a 3.8% decrease from the prior loss cost level. NCCI is an advisory organization to TDI and its designated statistical agent.

An insurer multiplies the loss cost for a class by its loss cost multiplier (LCM) to get its rate. Insurers must use Texas classifications. Premium can then change through an experience modifier, schedule rating, and optional plans such as deductibles. TDI's rate guide lists each company's LCM.

Worked example

The calculator uses: premium = (payroll / 100) × rate per $100 × experience mod.

TDI publishes a July 1, 2026, loss cost of 1.946 for Code 5551 (Roofing). The LCM, payroll, and mod below are illustrative only. Real premiums also reflect schedule rating and other plans.

1. Rate: 1.946 loss cost × 1.50 illustrative LCM = 2.919 per $100 of payroll.
2. Payroll units: $400,000 illustrative payroll ÷ 100 = 4,000.
3. Manual premium: 4,000 × 2.919 = $11,676.00.
4. Experience mod: $11,676.00 × 0.90 illustrative mod = $10,508.40.

At a 1.20 mod, the same employer would pay $11,676.00 × 1.20 = $14,011.20.

For a non-subscriber, the result is the estimated cost of the coverage they are choosing not to purchase.

FAQ

Official sources

• Texas Labor Code ch. 406
• Texas Labor Code ch. 409
• Texas Labor Code ch. 411
• Texas Labor Code ch. 415
• Texas Insurance Code ch. 2053
• Texas Insurance Code ch. 2054
• TDI employer resources
• TDI non-subscribers
• TDI employer FAQ
• DWC Form-005
• Employer forms and notices
• TDI rate guide
• Commissioner's Bulletin B-0001-26
• TDI unit statistical data (NCCI as statistical agent)

This is general information, not legal advice. Confirm details with the Texas Department of Insurance, Division of Workers' Compensation.

Reviewer: Sam Newland, CFP, Founder of Benefitra. Last updated October 17, 2026. How the calculator works. Editorial policy.