Usually yes, if you own the business. A corporate officer or director needs at least 10 percent of the stock, health insurance, and a signed waiver. General partners and LLC managing members sign the same waiver, with no ownership minimum. A sole proprietor is already out unless you opted in. Who this is for: California contractors who want their own payroll off the workers comp bill.
The short version
- Corporate officers, directors, general partners, and LLC managing members are covered by default in California. A written waiver takes you off.
- Officers and directors need at least 10 percent of the business, or 1 percent if a close family member holds 10 percent. Either way, you must have your own health insurance.
- Sole proprietors are out unless they opt in. Roofers and four other California license types must carry a policy even with no employees.
- From January 1, 2028, every licensed California contractor must carry workers comp, employees or not. Plan for it now.
- Excluding yourself means your own job site injury is not covered by workers comp. Weigh the savings against that.
Who can be excluded from workers comp in California?
California flipped its default in 2017 and 2018. Owners who work in the business are now covered employees unless they sign themselves off.
| Business type | Default | How to be excluded | Conditions |
|---|---|---|---|
| Corporate officer or director | Covered | Written waiver, signed under penalty of perjury, sent to the insurer | Own at least 10 percent of the stock, or at least 1 percent while a parent, grandparent, sibling, spouse, or child owns 10 percent. On either path you need health insurance or a health care plan. |
| General partner | Covered | Same written waiver | No ownership floor |
| LLC managing member | Covered | Same written waiver | No ownership floor |
| Sole proprietor | Not covered | Nothing to sign. You may elect in by endorsement (a change to your policy). | None, unless your license type requires a policy |
Shares or interests held in a revocable trust still count toward the percentages. Not sure which box you are in? Start with workers comp for California corporations, for California LLCs, or for sole proprietors.
How does the California waiver work?
The waiver is a short written statement that you are a qualifying owner and that you give up your workers comp rights. You sign it under penalty of perjury and send it to your insurer. The Department of Insurance publishes sample forms and most insurers have their own, so there is no single required state form. It takes effect when the insurer accepts it, and holds until you withdraw it in writing.
How much does excluding myself save in California?
California rates a covered owner on a set payroll range, not on what you actually pay yourself. For policies starting on or after September 1, 2026 that range is $66,300 to $171,600 a year. Nobody publishes a California rate for your trade, so work your own saving out from your own policy.
| Step | Where the number comes from |
|---|---|
| 1. The payroll California assigns you | $66,300 to $171,600 a year for policies starting September 1, 2026. The state sets the range, not you. |
| 2. Your rate per $100 for your job class | Your own policy or quote, next to your trade. Every California insurer files its own rate, so there is no single published number. |
| 3. Your saving | Step 1 divided by 100, times step 2. |
An owner rated as office staff saves a small fraction of what an owner rated as a roofer saves. The bigger your trade's rate, the bigger the saving, and the bigger the risk you take on yourself.
When is excluding myself a bad idea in California?
- You work in the field. Health insurance pays medical bills. It does not pay the wages you lose while you heal. Workers comp does both.
- Your license type requires a policy anyway. A California contractor licensed in C-8 concrete, C-20 heating and cooling, C-22 asbestos, C-39 roofing, or D-49 tree service must carry workers comp even with no employees. Excluding yourself does not remove the policy.
- Your customer wants owners covered. Some general contractors and public owners want every person on site covered, owners included. Check the contract first.
- You have even one employee. California requires coverage from your first employee, with no minimum headcount.
The national version of the trade-off is in can I exclude myself from workers comp.
What if I am a California sole proprietor with no employees?
Then you are already out, and the state does not require a policy. You can file a workers comp exemption with the Contractors State License Board, unless your license is in one of the five classifications above, you hire anyone covered by California law, or your license is qualified by a responsible managing employee. You also have to recertify the exemption at renewal.
Two cautions. If you hire an unlicensed helper, California law treats that person as your employee, and your policy or your own pocket answers if they are hurt. And from January 1, 2028 every licensed contractor must carry coverage, employees or not. See what a California contractor license requires.
What this looks like in real life
Illustrative example. It is typical of what we see and is not a promise of how any specific situation would be handled.
The setup: Two brothers run an electrical contracting S corporation in San Jose. Each owns 50 percent and both have health insurance through their spouses. One runs the office; the other runs the crews.
What went wrong: They sign waivers for both officers to save money. Eight months later the field brother falls from a ladder and is out for four months with a broken wrist and shoulder surgery.
What it cost: Illustrative math: excluding the field brother saved about $5,400 a year. The office brother, rated as office staff, saved about $600. Health insurance paid the surgery, but nothing replaced roughly $40,000 of lost salary during recovery.
The fix: At renewal they kept the office brother excluded, worth about $600 a year, and put the field brother back on the policy. The person actually on the ladder was covered.
Frequently asked questions
Q: Can I exclude myself from workers comp in California?
Usually yes. Corporate officers and directors with at least 10 percent of the stock (or 1 percent plus a close family member with 10 percent) and health insurance can sign a waiver. General partners and LLC managing members sign the same waiver. Sole proprietors are out by default.
Q: Do I need a specific California form to exclude myself?
No single required form number. The Department of Insurance publishes sample waivers and most insurers have their own. What matters is that it is in writing, signed under penalty of perjury, states you are a qualifying owner, and is accepted by your insurer.
Q: My LLC has two managing members. Can we both be excluded?
Yes. Each managing member signs their own waiver, and there is no ownership percentage requirement for LLC members here. If the LLC has any other employee, the policy itself still has to stay in force.
Q: I am a sole proprietor roofer with no employees. Do I still need a policy?
Yes. California requires C-39 roofers to carry workers comp even with no employees, along with C-8, C-20, C-22, and D-49 licensees. Without it the license board suspends the license.
Q: Should I exclude one owner and not the other?
Often, yes. The owner who works in the field is the one who needs the coverage, and the office owner is the cheap one to leave off. Split the decision by who is on site, not by who owns more.
Q: What if I change my mind after signing the waiver?
Withdraw it in writing to your insurer. The waiver holds until you do. Your coverage starts again when the insurer processes the withdrawal, so do not wait until after an injury.
How Morrow helps
Morrow is a licensed independent commercial insurance brokerage that works with contractors and trades every day. Helping California owners decide who should be on the workers comp policy, and getting the waivers and endorsements filed correctly, is a normal part of how we set up a contractor's coverage.
- Free contract review. Send us the contract or bid documents and we mark up the insurance section in plain English, whether or not you buy anything from us.
- Free, instant certificates. Clients issue their own certificates of insurance online in about a minute, any hour, any day, at no charge.
- Markets you cannot reach online. One application, shopped across many insurance companies for general liability, workers comp, auto, umbrella, and pollution coverage.
One more thing. This article is general information and is not legal advice or a statement of coverage. Your contract and your policy wording control in every case. Requirements vary by customer, by state, and by insurance company, so have a licensed advisor review your own contract and your own policy before relying on any of it.
Last updated: Reviewed by the Morrow commercial lines team. Last updated September 2026.