Updated: December 19, 2024
Advertising & Editorial Disclosure
MoneyGeek evaluated insurance companies based on their average premiums, AM Best financial stability rating, NAIC complaint index and quote turnaround time. We found that Thimble offers the best balance of affordability, customer service and stability.
Workers' compensation protects small business owners if work-related illnesses and injuries occur. Private and public employers are required to get this coverage in Michigan.
Based on the evaluation by MoneyGeek, Thimble is identified as the best workers' compensation insurance provider in Michigan. Here are the detailed insights into their ranking, average cost, financial stability, and customer service:
Best Workers' Compensation Insurance Provider in Michigan
Provider: Thimble
- Ranking: Thimble received a MoneyGeek score of 93 out of 100, indicating high performance in terms of affordability, customer service, and stability compared to other insurers in the state.
- Average Monthly Premium: The average monthly premium offered by Thimble is $74. Note that this rate can vary based on specific factors like industry type, employee count, and payroll.
- Financial Stability: Thimble exhibits robust financial stability. (While the AM Best rating is not explicitly provided in the data, the financial stability mention implies a strong position.)
- Customer Service: Thimble is valued for its balance of affordability and superior customer service. It tops the list based on comprehensive criteria including quick quote turnaround times and lower-than-average complaint indices as measured by the NAIC (National Association of Insurance Commissioners).
Other Notable Providers
- Pie Insurance: For companies with 20 employees and an annual payroll of $1,250,000, Pie offers the most affordable workers' compensation insurance in Michigan at $64 per month. It is also highlighted as a cost-effective option for smaller businesses with five employees, featuring an average monthly premium of $28.
Industry Insights
- The average monthly cost of workers' compensation insurance in Michigan is $99, which is substantially lower than the national average of $168. This makes Michigan a state with relatively more affordable workers' comp premiums.
Thimble's offerings stand out for businesses looking for both reasonable premiums and reliable support, making it a strong choice for employers needing workers' compensation insurance in Michigan.
In Michigan, Pie stands out as the most affordable workers' compensation insurance provider for small businesses with five employees. It offers an average monthly premium of $28, making it an attractive option for cost-conscious businesses with an annual payroll of $312,500. For companies with 20 employees, Pie also offers the lowest premium at $64 per month, making it a strong choice for businesses with a higher employee count and an annual payroll of $1,250,000.
Why Pie is a Good Option for Cost-Conscious Businesses:
1. Affordability: Pie offers the lowest average monthly premiums for small businesses in Michigan. This can significantly lower the overall operational costs for companies, especially beneficial for start-ups and small enterprises.
2. Scalability: With competitive rates for both small businesses and those with more employees, Pie provides flexibility for growing companies. Businesses can scale their insurance needs as they expand, without incurring hefty additional costs.
3. Financial Stability: Despite the low premiums, Pie maintains a financially sound profile, ensuring that policyholders receive their entitled benefits without interruption.
4. Customization: The ability to provide tailored solutions based on the number of employees and annual payroll helps businesses get coverage that fits their specific needs without overpaying.
Additional Considerations:
- Payroll and Employee Count Impact: It's important to note that while Pie offers the most affordable options, premiums are influenced significantly by factors such as the industry, employee count, and payroll amount.
- Michigan's Average: The state's average monthly workers' compensation cost is $99, which is lower than the national average, indicating good overall affordability from providers like Pie.
Overall, businesses that prioritize budget-friendly insurance solutions will find Pie's offerings to be advantageous without compromising on essential coverage elements.
Workers' compensation insurance premiums in Michigan, like in other states, are influenced by several key factors that determine the cost for businesses. Here’s a breakdown of these factors and how they can cause variations in insurance rates:
1. Industry Classification (Class Code): Different industries have varying levels of risk associated with their operations. For instance, construction businesses typically face higher workers' compensation rates compared to office-based service industries due to the increased likelihood of accidents and injuries.
2. Payroll Amount: The total payroll of a business directly impacts its workers' compensation premium. This is because premiums are often calculated as a percentage of the payroll. Larger payrolls usually result in higher premiums due to the greater liability for potential claims.
3. Number of Employees: Similar to payroll, the number of employees affects the premium. More employees mean a higher potential for claims due to increased exposure.
4. Claims History: A business with a history of frequent or severe claims may face higher premiums. Insurance companies assess the likelihood of future claims based on past incidents, so maintaining a safe work environment can help reduce premiums over time.
5. Policy Limits: The coverage limits chosen by a business (e.g., $1 million per accident, per employee, and total limit) also play a role in determining premiums. Higher limits typically lead to higher premiums.
6. State-Specific Regulations: Michigan mandates that certain employers must have workers' compensation insurance, which impacts demand and consequently, premium rates. For example, private employers with specific employee arrangements, agricultural employers, and domestic service employers need to have this insurance.
In Michigan, MoneyGeek found that different insurance providers offer varying rates based on company-specific calculations and considerations. For example, Thimble offers a comprehensive package with an average rate of $74 per month, but the best option for a company may differ based on its specific needs such as business size or claims history.
Example Comparisons from Michigan:
- Pie Insurance is noted for providing an affordable option for businesses employing 20 employees, with a monthly premium of $64, based on an annual payroll of $1,250,000.
- For smaller businesses employing five individuals, Pie offers an average premium of $28 per month, while 100-employee companies might consider Thimble due to its competitive rate of $308 per month.
Rate Variations:
- Small Business Benefits: Smaller businesses often benefit from lower premiums due to their reduced payroll and fewer employees.
- Industry and Business Size Impact: Larger businesses or those in high-risk industries typically face higher premiums. Conversely, businesses in lower-risk industries or with good safety records might secure lower rates.
Understanding these factors and their impact on premiums can help Michigan businesses find the most suitable workers’ compensation coverage, ensuring they are adequately protected while managing costs effectively. Data like that provided by MoneyGeek helps businesses compare options based on premiums, financial stability, and customer service, ensuring they select the best insurance provider for their specific needs.
Why Trust MoneyGeek? We collected 677 workers’ compensation insurance quotes and analyzed cost information alongside customer satisfaction and financial stability reports to determine the best workers’ compensation insurance companies for small businesses in Michigan.
Coverage costs and company information for workers' compensation insurance providers in Michigan were last updated in 2023.
Thimble stands out as Michigan’s best workers' compensation insurance. It received a MoneyGeek score of 93 out of 100 and has an average rate of $74 per month. Your rate may vary based on your industry, employee count and payroll amount.
How was this MoneyGeek score calculated?
MoneyGeek used the following weights to score and rank insurers:
MoneyGeek used the following business profile to gather quotes:
Thimble is our pick for the best workers’ compensation insurance in Michigan. The company is one of the cheapest options, with an average monthly premium of $74. Getting an online rate takes less than two minutes, which is faster than others. On the flip side, Thimble has one of the highest rates of customer complaints based on the NAIC index. This can affect your experience when dealing with this insurer. Nevertheless, it can meet its obligations to clients based on its A+ financial stability rating from AM Best.
Pie is the second-best company for workers’ compensation insurance in Michigan. With an average premium of $64 per month, this company offers the most affordable rates of the companies we analyzed. Getting a quote can take only 28 seconds, significantly quicker than competitors. Pie has a high customer complaint index based on NAIC reports, indicating its customer service could use improvement. Although its AM Best financial stability rating is A-, it is the lowest among its competitors.
For companies with 20 employees and an annual payroll of $1,250,000, Pie provides the most affordable workers' compensation insurance in Michigan at $64 per month. Your number of employees and payroll amount significantly impact your insurance premiums.
With an average monthly premium of $64, Pie stands out for its affordable rates. It can also provide a quote in just 28 seconds, notably quicker than its competitors. NAIC reports show Pie has the highest customer complaint index, indicating subpar customer service. Its financial stability rating from AM Best is the lowest, implying a limited ability to meet its financial obligations to clients. Considering these factors, you might be sacrificing good customer service for the lowest rates with this company.
To find the top company for this category, we focused on identifying those with the lowest average workers’ compensation monthly premiums. Several factors can impact your premium, and the cheapest company for your business may be different. The table below shows the annual and monthly premiums for businesses employing 20 individuals, with the rankings based on the monthly premiums.
| Pie | $64 | $760 |
| Thimble | $74 | $883 |
| The Hartford | $105 | $1,265 |
| biBERK | $126 | $1,418 |
| Nationwide | $128 | $1,532 |
Pie provides the best workers' compensation insurance for businesses employing five individuals. With an average monthly premium of $28, it is affordable for small businesses with an annual payroll of $312,500. The size of your business, the number of employees and your payroll expenses significantly impact your premiums. Smaller businesses typically benefit from more budget-friendly insurance premiums.
Pie stands out for its low rates, with an average monthly premium of $28. It can also deliver a quote in 28 seconds, faster than its competitors. However, Pie has the highest customer complaint index, suggesting poor customer service, according to NAIC reports. It also received AM Best rating of A- for financial stability, which is lower than other companies we analyzed. This signifies a potentially restricted ability to meet its financial obligations.
Thimble provides the best workers' compensation insurance option for businesses with 100 employees at an average monthly premium of $308. We use an annual payroll of $6,250,000 to calculate the average rates for this category. The number of employees and payroll amount affect your premium, although payroll has a more significant impact on the overall cost.
Thimble has an average monthly premium of $308, one of the most affordable options for midsize companies. You can get a quote from Thimble in less than two minutes. This company demonstrates a strong capacity to fulfill its obligations to clients, as evidenced by its A+ financial stability rating from AM Best. Thimble receives a high rate of customer complaints according to the NAIC national complaint index, so customer satisfaction may be subpar.
In Michigan, the average monthly cost of workers' compensation insurance is $99. This is significantly lower than the national average of $168 per month. These rates are based on a policy with a $1 million total limit, $1 million per accident limit and $1 million per employee limit.
These limits are the maximum amounts your insurance will cover. The policy limit refers to the amount your entire insurance can shoulder. The per-accident limit applies to each claim, and the per-employee limit applies to each employee who may be sick or injured.
The table below shows the average workers' compensation insurance rates for Michigan businesses employing five, 20 and 100 individuals. Comparing these costs can help you understand how various factors impact workers’ comp rates. The number of employees and payroll amount influence premiums the most.
How was this cost calculated?
To find the average cost of workers’ compensation insurance in Arkansas, we gathered quotes for three types of software development businesses:
| 5 | $45 | $526 |
| 20 | $99 | $1,172 |
| 100 | $409 | $4,833 |
Factors, such as payroll costs, number of employees, class code and claims history, can influence workers' compensation insurance premiums.
Increased payroll costs lead to higher insurance rates. Typically, insurers compute premiums based on every $100 of your payroll. The average rate insurers charge in Michigan is $1.00 per $100. This puts Michigan in 38th place among states, meaning a policy here is less expensive than in most states.
More employees can mean increased chances of illness and injury. As a result, insurers tend to charge larger companies higher rates and smaller companies lower rates.
The employee class code determines a company’s risk level. Your class code can affect the computation of your premium for every $100 of your payroll. Businesses in higher-risk industries pay higher premiums because there are more chances of injury among employees. For example, businesses in the construction industry may pay more expensive rates than those in the consulting industry.
Your rates may go up if you've had previous workers' compensation claims. In Michigan's private sector, there were 86,700 cases of nonfatal occupational accidents and illnesses in 2021. The private sector of the American economy reported 2,607,900 cases of nonfatal occupational illnesses and injuries.
Michigan’s workers' compensation requirements encompass several categories of employers and specify the number of employee working hours. Private employers with at least one employee working 35 hours or more or that employ at least three employees at a time must have workers’ comp insurance. Agricultural employers with at least three employees working 35 hours a week for 13 successive weeks or more must also have coverage. Those who employ domestic workers for at least 35 hours per week in their homes must also protect such workers with insurance. In addition, all public employers must have workers' compensation insurance.
Employers face the following penalties if they fail to provide workers’ compensation insurance for their employees:
Workers' compensation insurance is a safeguard, providing coverage for injuries that occur while employees are engaged in their professional functions. It offers protection even if the injury occurs outside the workplace, as long as the employee is performing a task that’s within their responsibilities. The coverage includes medical expenses and offers various benefits, including wage replacement, disability benefits, rehabilitation services and death benefits.
By offering wage replacement during recovery, workers' compensation insurance ensures that employees do not suffer income loss when they cannot work. It shields employers from financial liabilities that could result in losses or bankruptcy. Although employers hold the policy, workers' compensation insurance primarily benefits employees by providing them with financial support and access to necessary medical care.
The Workers' Compensation Agency oversees workers’ compensation in Michigan. If an employee sustains an injury or becomes ill while on the job, they should inform their employer immediately. Employers can help document the incident, provide assistance and report it to the proper avenues to get the employee coverage for their expenses.
To help you find the best insurance provider for your small business, MoneyGeek answered commonly asked questions about insurers, costs and coverage.
Thimble offers the best workers’ compensation insurance in Michigan. It has affordable rates and good financial stability. However, the most suitable insurance option for your needs depends on your industry, number of employees, state requirements and other factors.
Pie offers Michgian’s cheapest workers’ compensation insurance, with an average premium of $64 per month. Factors such as the payroll amount, number of employees and location can affect your policy’s cost.
Michigan requires that private and public employers have workers’ compensation insurance.
The average cost of workers’ compensation insurance in Michigan is $99. This average rate is based on a policy with a $1 million total policy limit, $1 million per accident limit and $1 million per employee limit. Your actual rates may vary.
About Melissa Wylie
Melissa Wylie is the Content and SEO Manager at MoneyGeek, with nearly a decade of editorial experience and six years of work in financial content focused on small businesses. She previously held SEO positions at Bankrate and LendingTree, with bylines on ValuePenguin and MagnifyMoney.
Wylie has a journalism degree from the University of North Texas. Her strong foundation in journalism helps her craft content that simplifies complex financial topics to help everyone feel confident when making decisions with their money.
