If your Montana corporation has any employees, yes, it needs workers compensation, and your corporate officers are covered by default. Montana treats a corporate officer as an included employee from the start, the reverse of the sole proprietor rule, so an officer who wants off the policy has to opt out, not opt in.
Who this is for: Montana C-corp and S-corp owners, including single-owner corporations and closely held ones.
The short version
- Employees trigger a policy (section 39-71-401), from your first worker.
- Officers are covered by default. Montana includes corporate officers as employees unless they properly opt out.
- A qualifying officer is exempt by law. An officer who owns a qualifying stake (10 percent or more of the shares, counting close family) or does not do ordinary work for pay is exempt under section 39-71-401, with the exclusion arranged on the policy with the insurer, and gives up his own comp benefits.
- Opting out does not drop staff. Removing an officer never removes your regular employees.
- A single-owner corporation still counts. If the corporation employs you as an officer, you are covered unless you opt out.
How Montana treats corporate officers
Corporate officers sit on the opposite side of the default from sole proprietors and partners. Where an owner of an unincorporated business starts outside coverage and elects in, a corporate officer starts inside coverage and is exempt only when he qualifies. That means if you do nothing, you are covered, which many owner-operators actually want. Under section 39-71-401, an officer is exempt when he owns a qualifying stake in the company, 10 percent or more of the shares counting a close family member's shares, or does not perform ordinary duties for pay. When that test is met the exemption applies by operation of law, and the exclusion is arranged on the workers comp policy with your insurer rather than through any separate state form or certificate. Until an officer qualifies and is excluded on the policy, he is a covered employee and his payroll is part of the premium.
Included by default, or opting out
| Your setup | Officer coverage | What to know |
|---|---|---|
| Corporation with employees | Officers covered by default | A policy is required for staff; officers are included unless they opt out |
| Single-owner corporation, you are the only worker | Covered by default | You are an employee of your corporation unless you opt out |
| Officer wants to be exempt | Exempt only if he qualifies | Must own 10 percent or more of the shares (counting close family) or not work for ordinary pay; the exclusion is set on the policy and waives his own benefits |
| Non-officer employees | Always covered | Opting out an officer never removes staff coverage |
What an officer gives up by opting out
Being exempt is not free of trade-offs. The statutory exemption strips all workers comp rights and benefits from the officer it covers, so an officer who is excluded and then hurt on the job cannot collect comp for that injury. For an owner who does hands-on or hazardous work, staying covered is often the safer call, even though it costs premium. For an officer who works only in the office and carries strong health and disability coverage, opting out can make sense. Either way, the choice affects only that officer, not the rest of the payroll.
A Helena example
Illustrative, not a quote. A Helena metal fabrication shop is an S-corporation with three employees and one owner-officer who works on the floor. The three employees must be covered from day one. The owner is covered by default as an officer; because he runs equipment alongside the crew, he keeps his coverage rather than filing for the exemption. When a customer asks for proof of coverage before a contract, the corporation produces a certificate the same day. See our workers comp for manufacturers page.
Real questions Montana owners ask
Does my Montana corporation need workers comp?
If it has any employees, yes, from the first hire. Corporate officers are also covered by default.
Are corporate officers covered in Montana?
Yes, by default. Montana includes officers as employees unless they properly opt out, which is the reverse of the sole proprietor rule.
How does an officer opt out?
He does not file a separate form. An officer who owns a qualifying stake, 10 percent or more of the shares counting close family, or does not perform ordinary duties for pay is exempt under section 39-71-401, and the exclusion is arranged on the policy with the insurer. It waives his own workers comp benefits.
I am the only person in my corporation. Do I need it?
If the corporation employs you as an officer, you are covered by default and generally need a policy unless you opt out.
Does opting out remove my employees from coverage?
No. Opting out only affects the officer; your regular employees stay covered.
What does the officer give up by opting out?
The statutory exemption waives the officer's own workers comp benefits, so an on-the-job injury to that officer would not be paid by the policy.
Do part-time or seasonal employees count?
Yes. They are employees from the first hire, with no minimum hours.
Why Montana owners choose Morrow
- We shop the right market for you. In Montana you buy workers' comp on the open market, where private insurers compete with the state-chartered Montana State Fund, which by law must insure almost any Montana employer that asks, so we can shop your rate across carriers and still keep the State Fund as a guaranteed backstop 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 Montana guides
Every Montana 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 Montana (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)
- Hiring your first employee: what changes
- Workers comp vs employers liability
- Montana manufacturer workers comp
This guide is general information, not legal advice. Montana rules and penalty amounts can change, so verify current requirements with the Montana Department of Labor and Industry, Employment Relations Division or a licensed advisor before you rely on them. Last updated: July 2026.