State labor officials are proposing a 2026 increase in workers’ compensation insurance rates for employers and employees to help cover projected costs for wage replacement, medical care and disability benefits.

The proposed 4.9% increase in the average hourly rate for workers’ compensation insurance would add $1.37 a week per full-time employee on average to those premiums, according to a release. Employers would pay 75% of that increase while workers pay the remaining 25%. 

“We’re always trying to balance keeping up with the rising costs of providing wage replacement and medical care benefits to injured workers, while keeping rates steady and predictable,” said Joel Sacks, state Department of Labor & Industries director, in a statement. 

Labor officials say the increase will not fully cover the anticipated costs of claims in the coming year, with the state L&I using its contingency reserve fund to cover the difference. Not using the reserve would instead raise the rate by as much as 13%. 

It’s a strategy criticized by Washington Research Council, a free market-focused thinktank. 

“The recent policy of setting rates so that they are below the break-even point hides the true cost of the workers’ compensation system,” wrote Emily Makings, the council’s senior research analyst, in a recent blog post. “Washington’s workers’ compensation benefit costs are the highest in the country.” 

L&I will conduct three public hearings on the rate increase before making a final decision, with the final hearing at 10 a.m. Oct. 30 being virtual only. To attend that meeting, go to https://lni-wa-gov.zoom.us/j/4283482697?omn=85288279946 and enter the meeting ID: 428 348 2697.

Final rates will be adopted on Nov. 26 and go into effect Jan. 1, 2026. 

Go to: Lni.wa.gov/2026Rates.