LLC member workers comp in Connecticut
Connecticut does not require LLC members to cover themselves. Single-member LLCs and member-managed LLCs typically elect out, lowering premium but giving up workers comp benefits if a member is injured at work. Verified 2026-05-09.
How LLC member coverage works in Connecticut
An LLC is a hybrid entity, members are owners but the LLC itself is the legal employer for any W-2 hires. Connecticut does not require LLC members to cover themselves. Single-member LLCs and member-managed LLCs typically elect out, lowering premium but giving up workers comp benefits if a member is injured at work. The default treatment depends on whether the LLC is single-member or multi-member, and whether it is member-managed or manager-managed.
Single-member LLC
A single-member LLC is generally treated like a sole proprietorship for tax and workers comp purposes. The member is not an employee of the LLC unless they elect to be. In Connecticut, single-member LLCs typically elect out of self-coverage; if the LLC has W-2 employees, the policy covers them only.
Multi-member LLC
A multi-member LLC is treated as a partnership unless it elects S-corp status. Members are not employees of the LLC, so workers comp historically did not apply to them. Connecticut preserves that default, members are excluded by default and the policy rates only W-2 payroll. Manager-managed LLCs sometimes treat one manager as a covered employee while excluding the rest.
Cost for an LLC in Connecticut
Premium is rated on payroll. If members elect in, the carrier rates each member's draw at a state-minimum payroll figure. The class code that matches the member's actual duties drives the rate per $100. A solo member-elected-in LLC on a clerical code typically pays the carrier minimum (around $250 to $500); a contractor LLC with two members elected in plus three W-2 employees can run from a few thousand to tens of thousands depending on payroll and risk. Connecticut carriers can apply schedule credits up to 25% for low-loss accounts.
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FAQs
Do LLC members need workers comp in Connecticut?
Connecticut does not require LLC members to cover themselves. Single-member LLCs and member-managed LLCs typically elect out, lowering premium but giving up workers comp benefits if a member is injured at work.
When does an Connecticut LLC have to start carrying workers comp?
Mandatory for all employers with one or more employees. For an LLC with no W-2 employees, the threshold may not trigger; once the LLC hires its first employee, the rule applies.
What if an LLC in Connecticut skips workers comp?
Failure to carry workers' compensation insurance can result in fines, imprisonment, and personal liability for employee injuries.
Are LLC member draws rated as payroll in Connecticut?
If a member is included in the policy, the carrier typically rates the member's draw at a minimum payroll set by the state (often around $50,000 annualized for Connecticut, sometimes capped at a maximum). The class code that fits the member's actual job duties drives the rate per $100. If the member elects out by filing an exclusion, draws are not rated and the member has no comp benefit.
Can a single-member LLC in Connecticut skip coverage?
A single-member LLC with no employees typically does not need workers comp at all in Connecticut; the coverage threshold usually requires at least one employee. Once the LLC hires its first employee, the member can still elect out of self-coverage and only insure the W-2 employees.