State Funds

Explanation of state funds (operated by a state) that issue workers compensation policies, just like an insurance company.

Employers must provide workers compensation benefits to injured employees by:

  • buying an insurance policy from an insurance company
  • buying insurance from a state fund
  • becoming an approved self-insurer

State funds are members of the American Association of State Compensation Insurance Funds (AASCIF)​

From the AASCIF website as of 09/14/2018:

At present, state funds exist in the following states and territories:

  • Exclusively by state fund: North Dakota, Puerto Rico and Wyoming.
  • Exclusively by workers’ compensation board: each Canadian province.
  • By either state fund or authorized self-insurance: Ohio and Washington.
  • By private insurance, state fund, or authorized self-insurance: Arizona, California, Colorado, Hawaii, Idaho, Kentucky, Louisiana, Maine, Maryland, Minnesota, Missouri, Montana, New Mexico, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas and Utah.​

Monopolistic State Funds (4)

A monopolistic fund is another statutorily established fund. In these states, it is the only source of workers compensation insurance coverage available. In a state with a monopolistic state fund, an employer needing workers compensation insurance may only obtain the coverage from this fund. The only alternative available to employers is to become approved by the state regulatory agency to self-insure their exposure. Monopolistic fund states include North Dakota, Ohio, Washington, and Wyoming. Monopolistic state funds face the same limitations many competitive state funds face in that they are not able to offer additional coverages such as the extension of coverage into other states due to jurisdictional limitations.

Note: Nevada and West Virginia were monopolistic fund states. Nevada allowed private insurance carriers to compete for business effective July 1, 1999 and West Virginia effective July 1, 2008.

StateFund Contact
North DakotaWorkforce Safety and Insurance (WSI)
OhioOhio Bureau of Workers’ Compensation (BWC)
Puerto RicoThe State Insurance Fund Corporation of Puerto Rico
WashingtonDepartment of Labor and Industries (L&I)
Wyoming Workers’ Safety and Compensation Division, Department of Employment

Competitive State Funds (23)

Many jurisdictions have created competitive funds to vie with commercial insurers for workers compensation business in their markets. Fourteen of the competitive state funds serve as the market of last resort for their state. Basically, that means that they cannot refuse to provide coverage to any employer who is subject to the workers compensation act and not in default of a workers compensation premium obligation. 

Due to the competitive nature of the mechanism, a competitive state fund can sometimes provide less expensive coverage than that offered by a voluntary carrier. One limitation of a competitive state fund is that many are not able to offer additional coverages such as the extension of coverage into other states due to jurisdictional limitations.

StateLast ResortFund Name
ArizonaNoThe Arizona State Compensation Fund
CaliforniaYesThe State Compensation Fund of California
ColoradoYesPinnacol Assurance
HawaiiYesHawaii Employers’ Mutual Insurance Company, Inc. (HEM1C)
IdahoNoThe Idaho State Insurance Fund
KentuckyYesKentucky Employers’ Mutual Insurance (KEMI)
LouisianaYesLouisiana Workers’ Compensation Corporation (LWCC)
MaineYesMaine Employers’ Mutual Insurance Company
MarylandYesThe Injured Workers’ Insurance Fund of Maryland (IWIF)
MinnesotaNoThe Minnesota State Fund Mutual Insurance Company (SFM)
MissouriNoMissouri Employers’ Mutual Insurance (MEM)
MontanaYesThe Montana State Compensation Insurance Fund
NevadaNoThe Employers’ Insurance Company of Nevada
New MexicoNoThe New Mexico Mutual Casualty Company
New YorkYesThe New York State Insurance Fund
OklahomaYesCompSource Oklahoma
OregonNoSAIF Corporation
PennsylvaniaYesThe Pennsylvania State Workers’ Insurance Fund (SWIF)
Rhode IslandYesThe State Compensation Insurance Fund
a/k/a The Beacon Mutual Insurance Company
South CarolinaNoSouth Carolina State Accident Fund
TexasYesTexas Mutual Insurance Company
UtahYesThe Workers’ Compensation Fund of Utah (WCF) 
West VirginiaYes Brickstreet Mutual Ins Co

Note: South Carolina, the State Accident Fund, per its website, covers state agencies, other government entities, and if required by the legislature, small businesses in the private sector