If you are a Minnesota sole proprietor with no employees, you are not required to carry workers compensation on yourself. Minnesota leaves a sole proprietor, along with their spouse, parent, and child, off coverage by default, and you can choose to elect in by giving written notice to an insurer. The moment you hire anyone outside that family circle, though, that employee must be covered from their first day, no matter how few hours they work.
Who this is for: Minnesota sole proprietors, from solo cleaners and handymen to one-person shops thinking about their first hire.
The short version
- A sole proprietor with no employees is not required to carry comp on themselves.
- Your spouse, parent, and child are left off by default too, and can be electively covered.
- You can elect in by giving written notice to the insurer; coverage starts the next day.
- Hire even one part-time employee outside the family and coverage becomes mandatory for that worker.
- Clients and general contractors often require proof of coverage before you can start, even if you work solo.
How Minnesota treats a sole proprietor
Under Minnesota law an employer must cover its employees, and a sole proprietor is the owner, not an employee of the business. So with no staff, the law does not force you to buy a policy on yourself, and the same is true for your spouse, parent, and child. Minnesota lets you elect in to cover your own on-the-job injuries by giving written notice to your insurer, and coverage starts the day after they receive it. That matters because a regular health plan may not pay for an injury that happened at work, and comp also replaces part of your lost income while you recover. If you do elect in, the insurer rates your own payroll into the price.
| Your situation | Is comp required? | What to know |
|---|---|---|
| Solo, no employees, no election | No | You are off coverage by default; a work injury falls back on your own insurance |
| Solo, elected in with written notice | Optional but active | Comp pays your work injuries; your payroll is rated into the price |
| You hire one part-time helper | Yes, for the helper | The employee is covered from day one; you can still elect yourself in |
| You use genuine subcontractors | Maybe | An uninsured sub can push liability onto you; confirm each sub carries its own coverage |
When a hire changes everything
The day you bring on your first non-family employee, Minnesota's first-employee rule kicks in and you must have a policy in force before they start work. There is no grace period and no minimum hours, so a weekend helper counts. If you use subcontractors instead of employees, be careful: a subcontractor who is really an employee under Minnesota's control test, or one who has no coverage of their own, can leave you responsible for an injury. Getting proof of coverage, a simple certificate, from every sub protects you.
Why solo owners still buy a policy
Many Minnesota sole proprietors carry comp on themselves even though the law does not require it, for two reasons. First, a serious work injury can wipe out a solo business, and comp pays medical bills and part of lost wages when your health plan will not. Second, general contractors and larger clients frequently will not let you on a job without proof of coverage, so a policy is the price of the contract. For a one-person business that needs the certificate but has no employees to insure, a low-payroll policy built around the owner is often the simplest fix.
A Duluth example
Illustrative, not a quote. A Duluth house cleaner runs a solo business with no employees. Minnesota does not require her to cover herself, but a property-management client will not add her to its vendor list without proof of coverage. She elects in by giving written notice to an insurer and buys a small policy, which gives her the certificate the client wants and pays her own medical bills if she is hurt on a job. When she later hires a part-time helper, we add the helper to the policy right away, because Minnesota requires it from the first day. See our workers comp for cleaning businesses page.
Real questions Minnesota owners ask
Do I need workers comp as a Minnesota sole proprietor?
Not on yourself if you have no employees. Minnesota leaves a sole proprietor off coverage by default, and you can elect in with written notice to an insurer. Hire anyone outside your family and that employee must be covered.
Can I put myself on a workers comp policy in Minnesota?
Yes. You give written notice to an insurer to elect in, and coverage starts the day after they receive it. Your own payroll is then rated into the price, and comp pays your on-the-job injuries.
Are my spouse and children left off too?
Yes. Minnesota leaves the sole proprietor's spouse, parent, and child off coverage by default along with the owner. You can elect them in if you want their work injuries covered.
Does my health insurance cover a work injury instead?
Often not. Many health plans exclude injuries that happen at work, and none of them replace lost income the way comp does. That gap is why many solo owners elect in even when it is not required.
What happens when I hire my first employee?
Coverage becomes mandatory for that worker right away. Minnesota has no waiting period and no minimum hours, so even a part-time or weekend hire must be covered from the first day they work.
A general contractor wants proof of coverage but I work alone. What do I do?
You can elect yourself in and buy a small policy built around your own payroll, which produces the certificate the contractor wants. It also covers your own work injuries, which your health plan may not.
Do I need comp for the subcontractors I hire?
Maybe. If a subcontractor is really an employee under Minnesota's control test, or has no coverage, you can be on the hook for their injury. Ask every sub for proof of their own policy.
Why Minnesota owners choose Morrow
- We shop the right market for you. In Minnesota you buy workers' comp on the open, competitive market from any private insurer licensed in the state, because there is no state fund, and if no carrier will take you the assigned-risk plan (MWCARP) 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 Minnesota guides
Every Minnesota 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 Minnesota (start here)
- Workers comp: the owner's overview
- I own an LLC: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- 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)
- Do sole proprietors need workers comp?
- Hiring your first employee: what changes
- Minnesota cleaning workers comp
This guide is general information, not legal advice. Minnesota rules and penalty amounts can change, so verify current requirements with the Minnesota Department of Labor and Industry or a licensed advisor before you rely on them. Last updated: July 2026.