As a small business owner, you know it is your responsibility to obtain workers’ compensation (work comp) coverage which will respond in the event your employee becomes injured on the job. Even though work comp insurance is heavily regulated, rates vary by state and typically, also by insurance company. We are often asked why rates vary so much. It is important to understand that loss costs vary by state because states have different benefit levels when injuries occur as well as varying medical costs and payroll to employees for lost time.