SACRAMENTO, Calif. – California remains among the top five most expensive states in the nation for employers to secure workers’ compensation coverage for their employees, according to the latest biennial report from the Oregon Department of Consumer and Business Services (OCBS). California ranked fourth most expensive for 2024 and its rate of $1.86 per $100 of payroll was 170% of the national median.
California’s fourth most expensive ranking for 2024 is down one spot from third most expensive in 2022. OCBS has published its “Workers’ Compensation Premium Rate Ranking Study” since 1986. Since 2000, California has ranked as the first or second most expensive state six times.
Currently, there is a pending recommendation by the Workers’ Compensation Insurance Rating Bureau to the California Department of Insurance to increase the “pure premium rate” (which serves as an advisory benchmark for rates) by 11.2% beginning September 1, 2025. This recommended increase is due to higher medical costs and administrative
expenses on claims and increasing frequency of cumulative trauma claims.
“Compared to other states, workers’ compensation costs remain stubbornly high in California, harming business competitiveness and siphoning off crucial public funding,” said Jerry Azevedo, spokesperson for the Workers’ Compensation Action Network. “Although California has successfully lowered costs during the past decade, abusive practices and fraudulent enterprises pose a constant threat to maintaining a stable and cost-effective system. When these abuses reach a tipping point and costs spiral, the system requires intervention from the State Legislature and Governor to ensure the system is serving the best interests of employers and injured workers.”
The full OCBS report can be accessed here.
Note on Methodology: To create a consistent benchmark across states, OCBS applies Oregon’s mix of industry classifications to the other 49 states and District of Columbia. The actual average insurance rate per $100 of payroll in each state reflects its own composition of industries.
Last modified: June 23, 2025
