A new contractor can typically buy workers comp with no loss history: the first policy is priced on estimated payroll by classification and settled at an audit after the term. Each license board also asks about coverage. California's CSLB needs a certificate or exemption on file, Arizona's ROC application carries a policy number when coverage is required, and Nevada's board wants proof or an exemption affidavit.
Every Crew Deserves a Crown
Questions about your own policy? Call and talk it through with a licensed broker.
Workers comp for new contractors usually comes up at the license application, often before anyone is on payroll. Each board asks its own coverage question, and the license can wait on the answer.
| State | When the Board Asks | What Satisfies It | Source |
|---|---|---|---|
| California | Before a license is issued, reinstated, reactivated or renewed | A current workers comp certificate in the business name, or a self-insurance certification. An applicant without employees can file the exemption in its place, except C-8, C-20, C-22, C-39, D-49 licensees. | Business and Professions Code 7125 |
| California | While the application is pending | The insurer files the certificate with CSLB under the application number, then the license number. Only insurers licensed to write workers comp in California may file it. | CSLB workers comp page |
| Arizona | On the ROC license application | An attestation of compliance with Arizona's workers comp law; if coverage is required, it holds the policy number or comes with proof of self-insurance. | Arizona Revised Statutes 32-1122(B)(1)(i) |
| Nevada | To obtain, maintain, activate or renew a license | Proof of industrial insurance, or an affidavit of exemption. | Nevada Revised Statutes 624.256 |
California. The insurer, not you, files the certificate under your application number until CSLB assigns a license number. If you will have employees, or your class can't use the exemption, the policy typically has to be bound before the license issues. The exemption is scheduled to narrow on January 1, 2028, and lawmakers may yet revise it; track it in the California contractor workers comp exemption 2028 guide.
Arizona. The policy number goes on the attestation only when Arizona law requires coverage. Under Arizona Revised Statutes 23-902(A), that reaches a business that regularly employs any worker in its trade, and regular employment includes work for part of the year, so a seasonal helper can count.
Nevada. The board wants proof of industrial insurance, the state's name for workers comp, or an exemption affidavit. The Division of Industrial Relations employer FAQ says a sole proprietor contractor working inside the scope of its license has to secure coverage too, so ask the board and the carrier before relying on an affidavit.
The license is one trigger for coverage; the first hire is the other, and one employee is enough in each state.
With no prior policy, the carrier works from your estimates: expected payroll by person and duty, placed in the published classifications that mention the work. The one that applies rests on each person's actual duties and the carrier's determination, and we never assign or confirm a code. An auditor later compares the estimate with real payroll; see what happens at a premium audit.
A first policy also has no experience modification. In California, the experience period starts four years and nine months before the rating effective date and ends one year and nine months before the rating effective date, so a new employer's first policies sit outside it, and a business must also reach the eligibility threshold of $11,700 for modifications effective September 1, 2026. Arizona and Nevada rate experience under NCCI rules; ask the carrier when a modification could first apply.
To see which published California classifications mention your work, browse the California workers comp classifications by trade or lay out each person's duties with Crown Your Crew.
Illustrative scenario
A Sacramento carpenter who has framed for other builders for years forms an LLC and applies for a CSLB license. She plans to hire two carpenters in the first month, so the exemption doesn't fit. Her application lists each hire's hourly rate, because California splits carpentry payroll at $46.00 an hour for policies from September 1, 2026. If a carrier accepts the risk, it files the certificate under her application number and the license can issue. The first policy carries no experience modification. This example is illustrative only.
Without loss runs to review, an underwriter leans on the application. Expect questions like these, and answer from records.
A brand-new business can be a harder fit for some carriers, and one decline says little about the next. Each state also has a backstop.
Canceling the Policy Between Jobs
A slow month can tempt a new contractor to cancel until the next job. In California, the lapse suspends the license by law, and anyone who works a day in the gap is an uninsured employee. Ask the carrier about lowering the payroll estimate instead.
For owners, subs and audits in more depth, browse the workers comp guides.
Send your trade, state and payroll, and a broker reviews the request. If you would rather talk first, leave a number.
Swipe or use the arrows for every answer.
Typically, yes. A first policy is written on estimated payroll by published classification, and the audit after the term settles the premium. Some carriers are cautious with a new business, so a complete application helps. In California, the state's own insurer may refuse a risk only on narrow grounds under Insurance Code 11784.
If you will have employees, or your class can't use the exemption, yes. Business and Professions Code 7125 makes a current certificate or self-insurance certification a condition of issuing the license, and the insurer files it under your application number. A no-employee applicant may file the exemption instead, unless the license is C-8, C-20, C-22, C-39, D-49.
The answer differs by state. In California, a no-employee applicant may file the exemption outside the classes that must carry coverage, an option scheduled to narrow on January 1, 2028. In Arizona, the attestation needs a policy number only if the law requires coverage. In Nevada, the board accepts proof of coverage or an exemption affidavit, though state guidance expects a licensed sole proprietor working in its own trade to carry coverage.
Arizona Revised Statutes 32-1122 requires an attestation that the applicant complies with Arizona's workers comp law. If coverage is required, the attestation contains the policy number or comes with proof of self-insurance. Check the current application on the ROC site, since forms change.
Typically not. The WCIRB's experience period starts four years and nine months before the rating effective date and ends one year and nine months before the rating effective date, so a new employer's first policies aren't in it yet, and a business also has to reach the eligibility threshold of $11,700. Until then, premium rests on classification rates and the carrier's own pricing.
Nevada Revised Statutes 616A.495 requires the policy and declarations page to be available for inspection at each location, and a temporary worksite must be able to produce it on short notice. A copy in each crew truck keeps that simple.
It's the common name for a workers comp policy written for a business with no one on payroll, often bought so a general contractor has a certificate on file. A workmans comp ghost policy typically covers no one: the owner is usually excluded and there's no payroll to insure, so it typically doesn't protect the owner. Whether a carrier writes one, and whether a general contractor or license board accepts it, varies by state, carrier guidelines and program. If you want workers comp insurance for self employed owners that does cover you, ask which carriers include owners in your state.
15 official sources
Reviewed by David Gleason, Principal, on .
Next Level Experience. Insurance Done Right.
A first policy built on honest estimates, ready before the license issues.
Type a question or topic, like class codes or plumbers. Results appear as you type.
