Texas is the only state where workers' comp is optional. But opting out exposes you to unlimited lawsuits. Here's what non-subscribers need to know.
State Guides | 7 min read | 2026-03-08
Texas is the only state where private employers can opt out of workers' comp. But 'optional' comes with serious legal exposure most business owners don't fully understand.
Texas stands alone among all 50 states in allowing private employers to completely opt out of the workers' compensation system. Employers who choose not to carry coverage are called 'non-subscribers.' According to the Texas Department of Insurance, roughly 20% of Texas employers are non-subscribers, covering about 5% of the state's workforce.
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