Short answer: In Colorado, an employer with one or more employees must carry workers' compensation, including for part-time workers. Under the FAMLI program, employers remit paid-leave premiums. Employers with 10 or more employees nationwide remit the full premium, while smaller employers remit only the employee share. Business vehicles need at least 25/50/15 liability.
This guide is general information for Colorado employers and business owners. It isn't legal advice. Agency rules change, so confirm with the agencies linked below.
1. Workers' compensation
Per the Division of Workers' Compensation, employers with one or more employees, including part-time workers, must carry workers' comp. Details: is workers comp required in Colorado.
2. FAMLI
Per FAMLI, premiums are split between employer and employee. Employers with 10 or more employees nationwide remit the full premium. Employers with nine or fewer remit only the employee share. You can deduct up to half of the premium from employees' wages. Report your headcount annually.
3. Business vehicles
Per the Division of Insurance, minimum liability is $25,000/$50,000 bodily injury and $15,000 property damage. See commercial auto insurance.
State unemployment insurance
Unemployment insurance is the other employer coverage Colorado makes mandatory. Per the U.S. Department of Labor's Significant Provisions of State UI Laws, January 2026, Colorado employers are covered once you meet the coverage test of 20 weeks or $1,500 in any quarter. The 2026 taxable wage base is $30,600 per employee. Experience-rated employers pay 0.56% to 7.34%, and new employers start at a base rate of 1.53% (higher rates can apply by industry). Register with the state's unemployment tax agency when you hire.
Beyond the mandates
Most other coverage, like general liability, property, professional liability and cyber, comes from contracts, leases and lenders rather than Colorado law. See small business insurance by industry or home-based business insurance. For-hire interstate carriers also face federal minimums under 49 CFR 387.9, starting at $750,000.
Questions? Contact Alishahi Insurance or call (877) 711-4545. See insurance in Colorado.
Frequently asked questions
Does a Colorado business with one employee need workers' comp?
Yes, including for part-time employees.
How does FAMLI work for small Colorado employers?
With nine or fewer employees nationwide, you remit only the employee share. At 10 or more, you remit the full premium.
What's Colorado's minimum auto insurance?
25/50/15.
Do Colorado employers have to pay for unemployment insurance?
Yes, once covered. The 2026 taxable wage base is $30,600, and new employers start at 1.53%.
Alishahi Insurance · 439 N Canon Dr, Penthouse, Beverly Hills, CA 90210 · (877) 711-4545 · CA License #4348151. General information only. This isn't legal, tax or financial advice or a coverage determination. Coverage depends on policy language and underwriting, and rules vary by state.