How is a workers' compensation premium calculated?

The base formula is payroll divided by 100, multiplied by the class code rate per $100, then multiplied by your experience modifier. So premium equals (payroll ÷ 100) × base rate × experience mod, before any discounts or fees.

What is a class code base rate?

Each job type has a classification code with a rate expressed per $100 of payroll, reflecting injury risk. Clerical work might be under $0.30 per $100, while roofing can exceed $20 per $100. Missouri rates are advisory loss costs adjusted by each carrier.

What is the experience modification factor?

The experience mod, or e-mod, compares your claims history to similar employers. A mod of 1.0 is average; below 1.0 means fewer claims and a discount, while above 1.0 raises your premium. Employers with good safety records earn lower mods over time.

Is workers' comp mandatory in Missouri?

Missouri requires workers' compensation coverage for most employers with five or more employees, and just one employee in the construction industry. Failing to carry required coverage exposes an employer to penalties and direct liability for injuries.

Can I buy coverage from a state fund in Missouri?

Missouri does not run a competitive state fund; coverage is bought from private carriers in a competitive market, or through the assigned-risk pool for high-risk employers who cannot find a private policy. Rates and discounts vary by carrier.

Missouri Workers' Compensation Premium Calculator

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Workers’ compensation premium is the cost an employer pays to insure employees against workplace injury. In Missouri, the premium scales with payroll, the job classification rate, and your experience modifier. This calculator applies the standard rating formula so you can estimate your annual workers’ comp cost before shopping carriers.

How it works

The premium is driven by payroll per $100, the class code rate, and your experience mod:

manual premium   = (annual payroll ÷ 100) × class base rate
modified premium = manual premium × experience modifier

A base rate is expressed per $100 of payroll and reflects the injury risk of the job class. The experience modifier (e-mod) rewards a good claims history below 1.0 and penalizes a poor one above 1.0. Missouri carriers apply their own discounts and fees on top of this, which this tool does not model.

Example

$500,000 payroll, a $2.50 base rate, e-mod of 0.90:

manual   = (500,000 ÷ 100) × 2.50 = 5,000 × 2.50 = $12,500
modified = 12,500 × 0.90 = $11,250 annual premium

Tips and notes

The class code rate is the biggest lever — low-risk clerical roles pay a fraction of what high-risk trades like roofing or framing pay per $100 of payroll. Improving workplace safety lowers your experience mod over several years, directly cutting premium. Missouri uses private carriers rather than a state fund, so shop multiple insurers; high-risk employers who cannot get a private policy use the assigned-risk pool.