If your Alaska corporation has employees, yes, it must carry workers compensation insurance, and whether the officers themselves are covered turns on how much of the company they own. Alaska automatically exempts a corporate director or officer who holds at least 10 percent of the company, while a director or officer holding less than 10 percent is treated as an employee who must be insured. Every non-owner employee must be covered from day one, with no headcount minimum.
Who this is for: Owners and officers of an Alaska C-corporation or S-corporation, whether a small closely held company or one with a full payroll.
The short version
- A corporation with employees must carry workers comp; there is no minimum headcount and no opt out for the company.
- A director or officer who holds at least 10 percent of the company is automatically exempt from coverage.
- A director or officer who holds less than 10 percent is an employee who must be insured.
- An exempt officer can opt in through the policy if they want comp for their own work injuries.
- If a corporation goes uninsured, the officers who could have secured coverage are personally liable for the claims.
How Alaska treats corporate officers
Alaska ties an officer's exemption to ownership, not just title. Since August 1, 2019, a corporate director or officer who holds a stake of at least 10 percent is automatically exempt, so the corporation is not required to cover that person and their pay stays out of the premium. A director or officer holding less than 10 percent is considered an employee and must be insured like any other worker. Ownership held through a parent company counts toward the stake. An exempt officer who wants their own injuries covered can still ask to be included on the policy. This is the same 10 percent line Alaska uses for LLC members, and it is different from the rule for sole proprietors and partners, who are simply the owners.
| Who | Covered by default? | What to know |
|---|---|---|
| Non-owner W-2 employee | Yes | Covered from day one; cannot be excluded |
| Officer who holds 10 percent or more | No, automatically exempt | Not required on the policy; may opt in for their own injuries |
| Officer who holds less than 10 percent | Yes | Treated as an employee who must be insured |
| Officer who does dangerous on-site work | Depends on stake | If exempt, weigh opting in; comp is often worth keeping for hands-on owners |
Whether to keep officers on the policy
For an officer who qualifies for the exemption, opting in adds their pay to the premium but gives them comp if they are hurt at work, and many health plans exclude work injuries, so staying off can be a false economy for an owner who is active in the business. A hands-off officer who never sets foot on the floor is a more natural candidate to stay exempt than a working owner-operator. Whatever the officers decide, the corporation still needs a policy the moment it has any non-owner employee or any officer holding under 10 percent.
Comp, lawsuits, and personal liability
Carrying comp does more than satisfy the state. As long as the corporation is insured, an injured employee's remedy is generally the comp claim, not a lawsuit against the business. If the corporation fails to carry required coverage, it loses that protection and an injured worker can sue the company directly. Worse, Alaska pierces the corporate shield for this: when a corporation is uninsured, the officers who had the authority to secure the insurance, and the people managing the business, are personally, jointly, and severally liable for the compensation owed. That trade, a predictable premium instead of personal exposure, is the core reason the coverage exists.
A Kenai example
Illustrative, not a quote. A Kenai metal-fabrication corporation has two officer-owners who each hold 40 percent and eight shop employees. The eight employees must be covered from day one. Both officers are automatically exempt because they each hold well over 10 percent, but the one who runs the shop floor opts in so a machine injury would be covered, while the one who handles only sales and the books stays exempt to trim the premium. We rate the shop payroll on the right manufacturing category so the price reflects the actual work. See our workers comp for manufacturers page.
Real questions Alaska owners ask
Does my Alaska corporation need workers comp?
If it has any employees, yes, from the first one, with no minimum headcount. Officers who hold at least 10 percent are automatically exempt, but any officer under 10 percent must be covered.
Are corporate officers covered by default in Alaska?
It depends on their ownership. A director or officer holding at least 10 percent is automatically exempt, so the corporation is not required to cover them. Below 10 percent, they are an employee who must be insured.
What if an officer owns less than 10 percent?
Then Alaska treats that officer as an employee who must be covered. The 10 percent line, in place since August 2019, decides whether an officer is an exempt owner or a worker who has to be insured.
Can an exempt officer still get their own injuries covered?
Yes. An exempt officer can ask to be included on the corporation's policy. Their pay is then rated into the premium and comp will pay their work injuries, which a health plan may not fully cover.
Do I still need a policy if all my officers are exempt?
Yes, if you have any non-owner employees or any officer holding under 10 percent. Those people must be covered from day one no matter what the qualifying officers choose.
What if my corporation does not carry required coverage?
Alaska can impose penalties and stop your work, an injured employee can sue the corporation directly, and the officers who could have secured coverage become personally liable for the claims.
Is a C-corp treated differently from an S-corp for this?
No. Alaska's workers comp rules turn on whether someone is a qualifying owner or an employee, not on the corporation's tax election, so C-corps and S-corps follow the same coverage rules.
Why Alaska owners choose Morrow
- We shop the right market for you. In Alaska you buy workers' comp on the open, competitive market from a private insurer authorized by the state, because Alaska has no state fund and no opt out, and if no carrier will take you the NCCI-run assigned risk pool is the guaranteed backstop, so we can shop your rate freely and still have a fallback for hard-to-place work.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Alaska guides
Every Alaska business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Alaska (start here)
- Workers comp: the owner's overview
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- We're a partnership: do we need workers comp?
- We're a nonprofit: do we need workers comp?
- My workers are 1099: do I still need it?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- What insurance do I need for a contractor license?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Workers comp vs employers liability
- What workers comp does not cover
- Alaska manufacturer workers comp
This guide is general information, not legal advice. Alaska rules and penalty amounts can change, so verify current requirements with the Alaska Division of Workers' Compensation or a licensed advisor before you rely on them. Last updated: July 2026.