On October 1, 2026, Nevada replaces its decades-old $36,000 per-employee workers’ compensation payroll cap with a new cap of $98,433.60, twelve times the state’s average monthly wage. For an office with modest salaries the change is small. For construction, where skilled trades routinely earn well above $36,000, it can meaningfully raise the payroll base your premium is built on. NCCI projects the change is roughly premium-neutral statewide, but contractors with high-wage crews are among the businesses most likely to see an increase.
What is SB 317, and what actually changed?
For years, Nevada calculated workers’ comp premium on the first $36,000 of each employee’s annual wages, a flat cap that hadn’t kept pace with wages. SB 317 (2025 session) replaces that flat number with a moving cap tied to the state average wage: 12 × Nevada’s average monthly wage, which currently works out to $98,433.60 per employee, per year, and will update annually. The payroll-cap change applies to policies issued or renewed on or after October 1, 2026. (Other parts of SB 317, an ODG-based drug formulary and updated treatment guidelines, phase in through July 1, 2027.)
Why does this hit contractors harder than most businesses?
Workers’ comp premium is roughly your rate times your payroll (per $100), applied by class code and capped per employee. Under the old $36,000 cap, a framer earning $70,000 only had $36,000 of “rated” payroll. Under the new cap, up to $98,433.60 of that wage counts. The trades most affected are the ones earning between the old and new caps, which is most of the skilled construction workforce.
| Employee annual wage | Rated payroll, old $36,000 cap | Rated payroll, new $98,433.60 cap |
|---|---|---|
| $40,000 | $36,000 | $40,000 |
| $65,000 | $36,000 | $65,000 |
| $95,000 | $36,000 | $95,000 |
| $120,000 | $36,000 | $98,433.60 |
Illustrative only. Your premium also depends on class code, experience mod, and carrier rates.
Won’t rates come down to offset the bigger payroll base?
That’s the intent. NCCI filed the change to be roughly premium-neutral statewide, with carriers reducing loss costs so the larger payroll base doesn’t simply inflate premiums. But two things are moving at once: separately from SB 317, Nevada saw an approximately 21.6% loss-cost increase take effect in March 2026, driven by rising claim severity, large-loss activity (notably in construction), and wage growth. “Neutral statewide” does not mean “neutral for you.” A high-wage contractor can still see a real increase.
What should Nevada contractors do before their next renewal?
- Ask your agent for a re-rate estimate using the new $98,433.60 cap so there are no surprises at renewal.
- Review your class codes. Misclassified payroll is one of the most common (and expensive) audit errors.
- Tighten safety and return-to-work programs; your experience modification factor is the lever you actually control.
- Collect certificates of insurance from every subcontractor. In Nevada construction, uninsured subs roll onto your policy at audit.
- Budget for the change now, especially if your crews are skilled trades earning well above the old cap.
FAQs
When does Nevada’s new workers’ comp payroll cap take effect?
It applies to workers’ comp policies issued or renewed on or after October 1, 2026. Policies already in force keep the old cap until their next renewal.
What is the new payroll cap amount?
It is $98,433.60 per employee per year, equal to 12 times Nevada’s average monthly wage, and it will be updated annually. It replaces the flat $36,000 cap.
Will my workers’ comp premium go up because of SB 317?
It depends on your wages. Higher-paid employees add more rated payroll, which raises premium. NCCI targeted statewide neutrality, but higher-wage employers, construction especially, are most likely to see an increase.
Is the March 2026 rate increase the same thing as SB 317?
No. The roughly 21.6% loss-cost increase that took effect in March 2026 is a separate change. Both affect what Nevada employers pay in 2026.
Do my subcontractors need their own workers’ comp?
Yes. Nevada treats construction relationships as employer-employee, and licensed contractors are responsible for ensuring subs carry coverage. Uninsured subs become your exposure at audit.
Related coverage
- Workers’ Compensation coverage page
- General Liability for Contractors
- Construction & Contractor Insurance
- Commercial Insurance in Reno, NV
Sources
- NCCI, “Nevada Payroll Cap and Premium Changes Under Senate Bill 317” (ncci.com)
- Nevada Division of Industrial Relations, Workers’ Compensation Section, “Important Changes” (dir.nv.gov/WCS)
- Nevada Legislature, SB 317 Overview, 83rd (2025) Session (leg.state.nv.us)
- Berkley Industrial Comp / Swarts Manning advisories on SB 317 and the March 2026 rate change
Mark is the principal of Statement Insurance Agency in Reno, Nevada, advising construction, commercial real estate, and food & beverage businesses on commercial coverage across Nevada and California. Meet the team →
✓ Reviewed by Mark Hutchings, Licensed Producer (NV #3600994, CA #6003400)
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