Vermont Business Insurance Guide 2026

Who must carry it: 1 or more employees (Vermont Department of Labor, Fact Sheet for Employers (workers' compensation)).

Workers’ compensation insurance is mandatory for all Vermont employers.

Source: Vermont Department of Labor, Fact Sheet for Employers (workers' compensation)

Exemptions and exclusions

21 V.S.A. 601(14) excludes casual employment not for the employer's trade or business; amateur sports; agricultural or farm employment for an employer with aggregate payroll under $10,000 a year, unless it opts in; family members living in the employer's house, unless included in the insured payroll; service in or about a private dwelling, unless the employer opts in; qualifying sole proprietors and partners of unincorporated businesses; and other listed groups (21 V.S.A. § 601).

The agency to ask is the Vermont Department of Labor, Workers' Compensation and Safety Division. For the coverage itself, see the workers' compensation guide; for a proposal's arithmetic, the workers' comp calculator.

Vermont's minimum auto liability limits:

• Bodily injury liability: $25,000 per person and $50,000 per accident
• Property damage liability: $10,000 per accident
• Start date: not stated in the source; confirmed in force on October 3, 2026
• Source: 23 V.S.A. § 800, Maintenance of financial responsibility (Vermont General Assembly)

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.

Vermont has a voluntary state paid leave program, the Vermont Family and Medical Leave Insurance (FMLI) plan, insured and administered by The Hartford; the Governor's office describes it as providing access to paid family and medical leave without imposing a new mandatory tax. It began with Vermont state employees in July 2023 (Vermont FMLI).

A January 2024 state announcement said employers with two or more employees could begin buying plans on February 15, 2024, with benefits beginning July 1, 2024, and that a final phase for individual workers, the self-employed and employers with fewer than two employees was planned for purchase in 2025 with benefits beginning July 1, 2025. The state page has no later update confirming those dates were met, so check the current plan with The Hartford or the Governor's office before relying on them (Vermont FMLI).

Providing all Vermonters with access to affordable paid family and medical leave, without imposing a new mandatory tax, is truly a win-win.

Source: Office of Governor Phil Scott, Vermont Family and Medical Leave Insurance (VT FMLI)

What employers do: No mandate. The January 2024 announcement said employers with two or more employees could design a plan, with contributions paid fully by the employer, split with employees, or paid fully by employees as a voluntary benefit (Vermont FMLI).

Insurance or bond conditions can also come from licensing boards, landlords and clients, for example as general liability limits or certificate wording. Log each one in the certificate of insurance checklist, and use the requirements-by-state guide for work outside Vermont.

• Workers' compensation: Vermont Department of Labor, Workers' Compensation and Safety Division
• Auto liability minimums: 23 V.S.A. § 800, Maintenance of financial responsibility (Vermont General Assembly)
• Paid leave and disability insurance: Vermont Governor's office (program insured by The Hartford)

Our state requirements checklist turns your employee count and vehicle use into questions for those offices. To ask PolicyBenchmark for a follow-up about your Vermont business, request coverage help.