NEXT is Texas' best workers’ compensation insurance provider, scoring 98 out of 100. The company offers a great mix of reliable customer service, very low workers' comp rates and a large coverage selection. Thimble and The Hartford are good runners-up to consider.
Cheapest Workers' Comp Insurance in Texas
Updated: June 3, 2025
Advertising & Editorial Disclosure
Key Takeaways
NEXT, Thimble, Pie, biBerk and The Hartford are the best cheap workers' comp insurance providers in Texas.
Workers' compensation coverage costs an average of $541 per year or $48 per month for most small businesses in Texas.
Workers' comp insurance is optional in Texas for all companies with employees to cover expenses when employees sustain injuries or illnesses during business activities.
Best Cheap Workers’ Comp Insurance Companies in Texas
| NEXT | 98 | $85 |
| Thimble | 93 | $98 |
| The Hartford | 88 | $175 |
| biBerk | 86 | $182 |
| Nationwide | 86 | $178 |
| Pie | 84 | $149 |
*Rates and scores are for software development businesses with small (five employees), medium (20 employees) and large (100 employees) operations, aggregated for an overall best recommendation.
NEXT: Best Overall
pros
Best overall ratings and customer service
Top-rated customer service reviews
Get quotes instantly on the web
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Not as affordable for those with over 50 employees
COMPANY HIGHLIGHTS
NEXT excels for businesses with under 50 employees and larger companies, earning Texas' best overall business insurance rating and excellent customer experience. Its 4.7 out of 5 customer rating and CNBC recognition as a top global digital insurer reflect its commitment to high-quality service for smaller businesses.
How Much Is Workers' Comp Insurance in Texas?
For software development companies in Texas, workers' comp rates range from $541 to $4,159 annually. However, this represents only a specific industry, and your rates will vary widely depending on the number of employees, the risk of your industry, the work your employees do individually and your claims history.
| Larger small businesses | $354 | $4,159 |
| Businesses with five or fewer employees | $48 | $541 |
| Medium-size small businesses | $98 | $1,142 |
Factors That Impact Workers’ Compensation Costs in Texas
The cost of workers' compensation insurance varies for each business, depending on several factors influencing coverage costs: business size, industry and location.
Payroll costs
Businesses typically pay workers' compensation rates based on each $100 of payroll. A business with higher payroll costs pays a higher premium than one with lower payroll costs. Texas' average premium index rate for 2022 is $2.26 per $100 of payroll, ranking third highest nationwide.
Number of employees
Companies with a large number of employees face a higher risk of employee injury, which can increase insurance premiums.
Employee class code
A class code identifies the type of work employees do. This code sets the rate charged for every $100 of payroll. High-risk industries like construction, mining and manufacturing typically have higher rates than lower-risk fields such as consulting, accounting and software development.
Previous claims
A history of workers' compensation claims can increase your premium. According to the Texas Department of Insurance (TDI), the state reported 175,900 recordable nonfatal cases in the private industry for 2023. Nationally, there were over 2.6 million recordable nonfatal cases in private industry.
Texas Workers' Comp Insurance: Buyer's Guide
Navigating business insurance is often complicated, so here's how to get the best workers' comp coverage, who needs it and what this type of policy covers to guide you.
How to Get the Best Workers' Comp Insurance in Texas
Below are the best steps to ensure you get the best workers' comp policy for your organization.
- 1
Learn about required coverages and options
Research your state's regulations first, as requirements and options vary widely. The coverage you need depends on your industry, organization size and claims history. Talk to a business insurance agent about what's right for your company before buying to avoid getting too much or too little workers' comp insurance.
- 2
Research costs and providers
Research average costs and providers for your specific business to determine which companies to get quotes from. Also, look into state-provided programs and possible self-insurance options to see if they are a better deal than traditional private insurers.
- 3
Consult similar businesses
Talk to other businesses in your community, especially those similar to yours. Ask about their experiences, needs and coverage choices to help inform your decision personally.
- 4
Compare multiple providers through different means
Get multiple quotes and compare providers equally to find the best deal. Prices vary depending on how you get quotes: online comparison sites versus speaking with an agent. Use different methods and contact various companies to gain the most balanced view of what's best for your business.
Do You Need Workers’ Compensation Insurance in Texas?
Texas is the only state where workers' compensation insurance is optional for most private employers, with specific exceptions for government entities and certain contractors. Even so, we recommend coverage to avoid liabilities.
WORKERS’ COMP LAWS AND RISKS IN TEXAS
While coverage isn't required in Texas for most employers, they should still understand the laws and regulations, plus other risks:
- Administrative fines for posting violations - Administrative penalties for failing to post the Notice of No Coverage to Employees prominently
- Annual filing requirement - Nonsubscribers must file Form DWC-005 Notice of Non-Coverage annually by the end of April
- Employee notification requirement - Must tell new employees in writing that workers' compensation doesn't cover them
- Injury reporting requirements - Nonsubscribers with five or more employees must report work-related fatalities, occupational diseases, and injuries resulting in more than one day of lost time using Form DWC-007
- Loss of legal protections - Nonsubscribers lose liability protections and common-law defenses, including contributory negligence and assumption of risk
- Personal injury lawsuit exposure - Injured employees can sue for high damage awards, including punitive damages, pain and suffering, and attorneys' fees
- No alternative coverage recognition - Texas law doesn't recognize accident/health insurance policies or disability policies as substitutes for workers' compensation coverage
What Does Workers’ Compensation Insurance Cover in Texas?
Workers' compensation insurance provides benefits to employees experiencing work-related injuries or illnesses. This coverage usually encompasses medical care, disability benefits, lost wages and more for affected workers, paying out 70% or 75% of weekly wages, depending on wage rate before injury based on Texas law. This safeguards employees and defends the business against potential legal claims associated with workplace injuries or illnesses.
Best Workers' Compensation Insurance Texas: Bottom Line
Texas' best and most affordable workers' comp insurance providers are NEXT, Thimble and Pie. While these companies are our recommendations, compare rates and consult similar businesses in your industry to get the best deal.
Workers' Comp Insurance in Texas: FAQ
Below are answers to frequently asked questions about Texas workers' comp insurance from our MoneyGeek experts:
Which company has the best workers’ compensation insurance in Texas?
In Texas, NEXT surpasses its competition due to its competitive pricing (averaging around $85 per month) and low complaint index. Selecting the best insurance for your needs will depend on various aspects, including your industry, workforce size and particular state requirements.
Does Texas require businesses to have workers’ compensation insurance?
Texas is the only state that doesn't require most private businesses to carry workers' compensation insurance. However, government entities must have coverage, and some construction contractors on public projects need it. Companies operating without workers' comp become liable for workplace injuries and potential employee lawsuits.
How much does workers’ compensation insurance cost in Texas?
Workers’ compensation insurance in Texas averages $98 monthly for medium-sized small businesses with around 20 employees.
How We Rated Workers' Comp Insurance Companies in Texas
MoneyGeek calculated workers' compensation insurance rates using a software development business with five, 20 and 100 employees to represent various organization sizes.
Our scoring methodology included:
- Affordability (60%): Overall cost compared to other providers and different business profiles
- Customer experience (30%): Ratings from actual customers, J.D. Power studies, AM Best financial stability ratings and our team's experience with quote processes
- Coverage (10%): Additional options beyond standard offerings and breadth of industries served
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
sources
- NEXT. "NEXT Insurance Recognized as a Top Global Digital Insurer by CNBC." Accessed June 3, 2025.
- NEXT. "Workers' Compensation Insurance Reviews." Accessed June 3, 2025.
- TDI Division of Workers’ Compensation. "2023 Rates of Texas Work-Related Injuries and Illnesses." Accessed June 3, 2025.
- Texas Mutual. "Workers' Compensation Insurance." Accessed June 3, 2025.
- U.S. Bureau of Labor Statistics. "Employer-Reported Workplace Injuries and Illnesses – 2023." Accessed June 3, 2025.