State insurance guide
Michigan Business Insurance Guide 2026
Michigan private employers must carry workers' compensation if they regularly employ three or more employees at one time, including part-time workers, or if they regularly employ even one employee 35 hours or more a week for 13 weeks or longer in the preceding 52 weeks. Auto liability minimums and paid leave rules follow, each with its official source.
Explore Michigan requirements
Open the state requirements checklistMichigan private employers must carry workers' compensation if they regularly employ three or more employees at one time, including part-time workers, or if they regularly employ even one employee 35 hours or more a week for 13 weeks or longer in the preceding 52 weeks (Michigan Workers' Disability Compensation Agency: Workers' Disability Compensation Insurance Requirements).
Michigan auto policies must carry liability limits of $250,000 per person, $500,000 per accident and $10,000 for property damage in another state unless the insured signs a form choosing lower limits, which cannot go below $50,000 and $100,000 (MCL 500.3009). Michigan runs no state paid family leave or disability insurance program, according to NCSL's table.
We checked each official source on October 3, 2026. Treat this as general information and confirm with the linked agencies how each rule applies to you.
Shopping for business insurance in Michigan? Request coverage help
Workers' compensation
Who must carry it: 3 or more at one time, or 1 working 35+ hours a week for 13+ weeks (Michigan Workers' Disability Compensation Agency: Workers' Disability Compensation Insurance Requirements).
Exemptions and exclusions
Agricultural employers are covered if they employ three or more people 35 hours or more a week for 13 or more consecutive weeks, and householders if anyone they employ as a domestic worker works 35 hours or more a week for 13 weeks or longer in the preceding 52 weeks. Partners, corporate officers and LLC managing members count as employees, while a sole proprietor is never an employee of that business. Some employers comply by properly executing an exclusion form instead of insuring (Michigan Workers' Disability Compensation Agency: Workers' Disability Compensation Insurance Requirements).
The agency to ask is the Michigan Department of Labor and Economic Opportunity, Workers' Disability Compensation Agency. The workers' compensation guide covers what a policy pays, and the workers' comp calculator works through payroll, rate and modifier figures you enter.
Auto liability minimums
Michigan's no-fault law starts from higher limits and lets the insured choose lower ones in writing:
- Bodily injury liability: $250,000 per person and $500,000 per accident, unless the insured signs the form issued by the Department of Insurance and Financial Services choosing lower limits; those may not go below $50,000 per person and $100,000 per accident (MCL 500.3009)
- Property damage liability: $10,000, for damage in another state; damage your vehicle does to other people's property in Michigan falls under mandatory property protection insurance, which pays up to $1 million (Michigan Department of Insurance and Financial Services, Auto Insurance Frequently Asked Questions)
- Also required: personal injury protection (PIP) and property protection insurance (PPI) (Michigan Department of Insurance and Financial Services, Auto Insurance Frequently Asked Questions)
- In force: for policies issued or renewed after July 1, 2020 (Michigan Department of Insurance and Financial Services, Auto Insurance Frequently Asked Questions)
Commercial and for-hire vehicles can face different or higher federal or state requirements, and leases, lenders and clients can ask for more; see our commercial auto guide.
Paid leave and disability insurance
There is no state paid family and medical leave insurance program and no state temporary disability insurance program in Michigan, according to NCSL's table, last updated November 7, 2025 (NCSL: state family and medical leave laws; cross-checked on October 3, 2026 with the U.S. Department of Labor Women's Bureau).
Because legislatures can create programs, as Virginia did in 2026 (Code of Virginia § 60.2-801), check with the Michigan Department of Labor and Economic Opportunity before relying on this for a future Michigan payroll year.
Other requirements to check
Your trade license, lease or client contracts in Michigan can set their own conditions, for example general liability limits or certificate wording. Keep track with the certificate of insurance checklist, and see the requirements-by-state guide if you work across state lines.
Where to verify
- Workers' compensation: Michigan Department of Labor and Economic Opportunity, Workers' Disability Compensation Agency
- Auto liability minimums: Michigan Department of Insurance and Financial Services, Auto Insurance Frequently Asked Questions
- Paid leave and disability insurance: NCSL state family and medical leave laws and the U.S. Department of Labor Women's Bureau
Use the state requirements checklist to organize what to ask. You can also request coverage help for a PolicyBenchmark follow-up about your Michigan business.
Frequently asked questions
How many employees trigger workers' compensation in Michigan?
Michigan uses two tests. A private employer needs coverage if it regularly employs three or more people at one time, counting part-time workers, or if even one employee works 35 hours or more a week for 13 weeks or longer in the preceding 52 weeks. The agency to ask is the Michigan Department of Labor and Economic Opportunity, Workers' Disability Compensation Agency.
Are Michigan's auto minimums enough for business vehicles?
Michigan's limits are $250,000 per person and $500,000 per accident for bodily injury and $10,000 for out-of-state property damage, unless the insured chooses lower limits in writing, down to $50,000 and $100,000 (MCL 500.3009). Even the default limits are not a measure of what a business needs, and commercial and for-hire vehicles can face different or higher federal or state requirements.
Does Michigan require employers to pay into a paid leave program?
Not according to NCSL's table, last updated November 7, 2025: Michigan has no state paid leave or temporary disability insurance program for private employers (NCSL). Confirm before planning a future payroll year.
About this article
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This content is for informational purposes only and does not constitute insurance advice. Always consult with a licensed insurance professional before making coverage decisions.