Why Insurance for Staffing Agencies Is Getting Harder to Place
By T2 Insurance Solutions on January 14, 2026
Securing insurance for staffing agencies has always required some finesse — but lately, even seasoned brokers are finding it tougher to place workers’ comp for staffing clients. Between shifting carrier appetites, rising claim frequency, and multistate classification issues, the landscape is tightening fast.
The hardening of the staffing insurance market isn’t just anecdotal. A growing number of underwriters are walking away from temp labor entirely, leaving retail agents scrambling for solutions. That’s where a wholesaler like T2 Insurance Solutions comes in. With access to exclusive markets and decades of niche expertise, we help brokers find a path forward in an increasingly restricted space.
What’s Changing in the Workers’ Comp Market?
One of the biggest shifts in recent years is the growing caution among carriers when it comes to underwriting higher-risk classes. With rising medical costs, more frequent litigation, and ongoing labor shortages, many insurers are tightening their appetite across the board.
This shift is especially noticeable in industries like staffing, where temporary and light industrial placements already come with higher claim frequency. While not every carrier has pulled out of staffing, many are applying increased scrutiny to classes they previously accepted — particularly in states with a history of high severity or frequency.
Carriers are also being more exacting about classification codes. The distinction between clerical, industrial, and healthcare staff is no longer treated loosely. One misclassified role can mean denied claims or premium audit disputes — both costly for your client and damaging to your agency relationship.
And even when a policy is placed, expect stricter underwriting and more questions upfront. Insurers want detailed job descriptions, clear safety protocols, and loss history documentation, especially for multi-jurisdictional employers.
Why Staffing Firms Are Viewed as High-Risk
Staffing agencies face a unique combination of risk factors that make them challenging to insure, particularly for workers’ compensation. These include:
- High turnover and job variability: Temporary workers rotate in and out of assignments, often with little notice. It’s more difficult to track training, enforce safety standards, or establish a consistent claims history.
- Misclassification and reporting errors: A receptionist assigned to a warehouse, a janitor misclassified as clerical — small mistakes like these can turn into major claim disputes or trigger audits.
- Multistate exposure: Many staffing companies place workers across state lines, exposing them to different compliance requirements, reporting standards, and insurance regulations. Inconsistent safety programs across locations only compound the risk.
Add the fact that short-term labor spikes (common in seasonal or project-based industries) tend to drive up claims, and it’s easy to see why traditional markets are saying “no.”
How T2 Can Help Brokers Find a Market
When standard carriers back away, retail brokers need a partner with access to specialty and alternative markets. That’s where T2 stands out.
We specialize in placing tough-to-write staffing risks, especially in the workers’ comp space. Our team is licensed in every state and brings over 100 years of combined experience to the table. We’ve worked with thousands of P&C agents, and we know exactly how to navigate the complexities of multistate, high-turnover clients.
T2 offers:
- Access to hard-to-find and exclusive carriers
- Speedy turnaround on quotes and applications
- Guidance on class codes, rating issues, and documentation
- Support for retail brokers navigating new or distressed accounts
We also help brokers stay informed. Our guide on What To Watch For in 2026 outlines what staffing agencies should expect in the coming year — including tighter regulations and growing demand for loss-control programs.
Solve the Placement Puzzle With a Workers’ Comp Expert
Insurance for staffing agencies isn’t just harder to place; it’s riskier to get wrong. A missed classification or unclear submission can cause ripple effects that hurt your clients and your book of business. But that doesn’t mean there aren’t options.
When retail carriers say no, T2 can open the door to alternatives that fit your client’s unique risk profile. We understand the staffing space inside and out, and we’re here to help brokers place workers’ comp accounts that others can’t or won’t touch.
Need help placing hard-to-write staffing accounts? Partner with T2.
FAQ on Harder-To-Place Insurance
Why is it hard for staffing agencies to get insurance?
Staffing firms are viewed as high-risk due to high turnover, unclear job roles, multistate operations, and frequent misclassification issues. These factors increase the likelihood of claims and compliance challenges, making many carriers reluctant to underwrite them.
What risks make workers’ comp hard to place in staffing?
Common risks include temporary employees working in hazardous roles, poor loss history, inconsistent safety training, and difficulty verifying the worksite environment. Multistate employment adds further complications due to differing regulatory standards.
Can a wholesaler really make a difference?
Yes. Wholesalers like T2 have access to specialty markets and underwriting relationships that retail agents often can’t tap into directly. This opens new doors for hard-to-place staffing accounts.
About T2 Insurance Solutions
T2 Wholesale Insurance Brokers is a reliable expert in workers’ compensation insurance. With a century of combined experience, T2’s founders bring unparalleled insight and understanding to the table. Specializing in catering to the unique demands of workers’ compensation insurance, T2 prides itself on its ability to craft comprehensive and competitive insurance solutions that address the diverse requirements and challenges faced by all industries.
