Michigan workers' comp and liability insurance
Michigan requires workers' compensation once you have three employees, or even one full-time employee, and it uses its own classification system instead of NCCI's. We help Michigan home care agencies, home health agencies, hospices and adult foster care homes, from Detroit and Grand Rapids to Lansing, put workers' comp and liability coverage in place. (Checked against Michigan sources on October 23, 2026.)
Who must carry workers' comp in Michigan
A private Michigan employer must carry workers' compensation if it regularly employs three or more people at one time, part-time staff included, or if it has employed at least one person for 35 or more hours a week for 13 weeks or longer in the past 52 weeks (MCL 418.115). Partners, corporate officers and LLC member-managers count as employees; sole proprietors never do. Corporate officers who own at least 10% of a corporation with no more than 10 stockholders, and LLC member-managers who own at least 10% of an LLC with no more than 10 members, can elect out in writing (MCL 418.161). The program is run by the Workers' Disability Compensation Agency (WDCA) within the Department of Labor and Economic Opportunity.
Penalties for going without coverage
- A misdemeanor punishable by a fine of up to $1,000, up to six months in jail, or both, and each day without coverage is a separate offense (MCL 418.641)
- An injured employee can sue the employer directly for damages instead of being limited to workers' comp benefits
- The state can sue to recover benefits its fund pays to the employer's injured workers
- Corporate officers and directors are personally liable for amounts the corporation doesn't pay
How Michigan rates and class codes work
Michigan doesn't use NCCI. Advisory pure premiums come from the Compensation Advisory Organization of Michigan (CAOM), and carriers add their own expense loads or file rates independently, so quotes for the same agency can vary widely. CAOM's advisory pure premiums for January 1, 2026 dropped 3.3% on average. Michigan also has its own classifications for care providers.
Class codes for Michigan care providers
- 8835 Home health care: home help, homemaker and nursing services by nurses, aides or therapists in clients' homes
- 9053 Adult foster care facility, assisted living facility and home for the aged, a Michigan-only code (NCCI states use 8824 or 8826)
- 8829 Nursing or convalescent homes and hospice facilities
- 8810 Clerical office employees
Licensing Michigan care providers
Michigan doesn't license home health agencies at the state level; Medicare and Medicaid certification is voluntary, and with LARA prioritizing other survey work, new agencies generally certify through an accrediting organization. Michigan doesn't currently license non-medical home care agencies either. Hospices are licensed by LARA under Part 214 of the Public Health Code. Michigan doesn't license assisted living as such: depending on the level of care, a facility may need an adult foster care license (1979 PA 218), with renewal fees from $100 for a family home to $500 for a large group home, or a home for the aged license for 21 or more residents aged 55 and older.
Medicaid Home Help and contracts
Agencies in Michigan's Medicaid Home Help program must directly employ their caregivers, with no subcontracting, and have at least two caregivers besides the owner on a monthly payroll. That usually puts an agency over the workers' comp threshold. MI Choice waiver agencies, hospitals and other referral partners set their own insurance requirements, so check each contract for the liability limits it requires.
Coverage we build for Michigan agencies
- Workers' compensation classified correctly under 8835, 9053 and 8810
- General and professional liability at the limits your MI Choice, payer and referral contracts require
- Abuse and molestation coverage for in-home and residential care
- Hired and non-owned auto for caregivers driving to clients, plus employment practices liability
Frequently asked questions
Is workers' comp required in Michigan with one employee?
It can be. Michigan requires coverage with three or more employees at one time, or with even one employee who has worked 35 or more hours a week for 13 weeks or longer in the past 52 weeks. Most care agencies with a full-time caregiver meet that test.
What workers' comp class code applies to home care in Michigan?
Class 8835, home health care, which covers home help, homemaker and in-home nursing services. Adult foster care, assisted living and homes for the aged use Michigan's own class 9053.
Does Michigan license home care or home health agencies?
No. Michigan doesn't require a state license for home health agencies or non-medical home care agencies. Hospices, adult foster care homes and homes for the aged are licensed by LARA.
What are the penalties for not having workers' comp in Michigan?
A misdemeanor with a fine of up to $1,000 and up to six months in jail, with each day counted as a separate offense. The employer can also be sued directly by injured workers, and corporate officers can be held personally liable.
Can Michigan business owners exclude themselves from workers' comp?
Sole proprietors aren't employees. Officers owning at least 10% of a corporation with 10 or fewer stockholders, and member-managers owning at least 10% of an LLC with 10 or fewer members, can elect out in writing. Partners can be excluded by policy endorsement.
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