If your Hawaii partnership has any non-owner employees, yes, it must carry workers compensation insurance, because Hawaii requires coverage once you have any employee under Chapter 386. The partners themselves are usually left off: an individual general partner is excluded from the coverage rule, and a limited liability partnership partner is excluded when they hold at least half of the partnership. So your staff drives the requirement, not the partners.
Who this is for: Hawaii general partnerships and limited liability partnerships, whether it is just the partners or a partnership with employees on payroll.
The short version
- A partnership with any non-owner employee must carry workers comp for that employee.
- An individual general partner is excluded from the coverage rule by default.
- A limited liability partnership partner is excluded when they hold at least a 50 percent interest.
- Excluded partners are off by default but can opt in through voluntary coverage.
- No partnership can force a worker to become a partner just to dodge coverage.
How Hawaii treats partners
Hawaii keeps partners out of the coverage rule, with a size test for the newer partnership form. A general partner who is an individual is excluded, so a two-person general partnership with no employees does not need a policy for the partners. In a limited liability partnership, a partner is excluded only when that individual holds a transferable interest of at least 50 percent. A partner below that line in an LLP is not automatically excluded, so it pays to check the split. Hawaii also blocks an employer from requiring a worker to become a partner as a condition of the job, which stops using a partnership title to avoid covering real employees.
| Partner or worker | Covered by the mandate? | Notes |
|---|---|---|
| Individual general partner | No, excluded | May opt in through voluntary coverage |
| LLP partner holding at least 50 percent | No, excluded | Size test applies to LLP partners |
| LLP partner holding under 50 percent | Not automatically excluded | Check the interest split; may be treated as covered |
| Any non-owner employee | Yes | Covered from day one, part-time included |
Covering the partners anyway
Partners often choose to opt in even though the state leaves them off. A partner who is hurt on the job cannot fall back on a comp claim unless they elected coverage, and a serious injury can mean months of lost income. Electing voluntary coverage adds the partners to the policy so their own injuries are paid. If a client or general contractor requires proof of coverage, having the partners on the policy also makes the certificate simpler. We can price the partnership with and without the partners on it so you can see the difference.
A Kapolei example
Illustrative, not a quote. Two partners run a Kapolei landscaping partnership and bring on two seasonal crew members for the busy months. Because the partnership has non-owner employees, Hawaii requires a policy, and the two crew members are covered from their first day even though they are seasonal. The partners are excluded by default, but both work in the field, so they opt in through voluntary coverage to protect themselves. We rate the crew payroll on landscaping work so the price reflects the real exposure. See our workers comp for landscapers page.
Real questions Hawaii owners ask
Does our Hawaii partnership need workers comp?
If you have any non-owner employees, yes, from the first one. The partners themselves are usually excluded, but your employees must be covered under Chapter 386.
Are partners covered in Hawaii?
Usually not by default. An individual general partner is excluded, and an LLP partner is excluded when they hold at least 50 percent. Excluded partners can opt in through voluntary coverage.
We are a two-partner firm with no employees. Do we need a policy?
Generally no. Individual general partners are excluded from the coverage rule, so a partnership with only partners and no employees is not required to carry it. You may still opt in to protect yourselves.
What about a partner in an LLP who holds less than half?
That partner is not automatically excluded. The LLP exclusion applies at a 50 percent interest, so a smaller partner may be treated as covered. Check the split before you assume.
Can the partners get their own injuries covered?
Yes. Partners can elect voluntary coverage and add themselves to the policy so comp pays their own on-the-job injuries, which is common when partners do the physical work.
Can we make a worker a partner to avoid covering them?
No. Hawaii bars an employer from requiring a worker to become a partner as a condition of employment, so a partnership title cannot be used to dodge coverage of a real employee.
Do seasonal crew members count?
Yes. Part-time, temporary, and seasonal workers are all covered employees in Hawaii, so hiring seasonal crew means the partnership needs a policy for them.
Why Hawaii owners choose Morrow
- We shop the right market for you. Hawaii has no state-run fund, so private insurers compete for your business and we can shop your rate freely. If no insurer will take you, there is a guaranteed backstop: HEMIC, a member-owned insurer that has to cover businesses others turn down.
- 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 Hawaii guides
Every Hawaii 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 Hawaii (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?
- I own a corporation (C-corp or S-corp): do I need it?
- 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)
- Do sole proprietors need workers comp?
- What workers comp does not cover
- Hawaii landscaper workers comp
This guide is general information, not legal advice. Hawaii rules and penalty amounts can change, so verify current requirements with the Hawaii Department of Labor and Industrial Relations, Disability Compensation Division or a licensed advisor before you rely on them. Last updated: July 2026.