Employers with four or more employees in South Carolina must carry workers’ compensation insurance.
Work comp protects employees when injuries or illnesses they sustain at work require medical treatment or missed work.
A workers’ comp insurance policy protects employers by covering medical expenses for injured workers, and can pay for employer legal defense fees in an injury-related lawsuit.
All South Carolina businesses with four or more employees must carry work comp insurance, whether full-time, part-time or employed family members. The state does not offer an exemption form or certificate to opt-out of coverage, though certain roles can exclude themselves.
In South Carolina, these roles are excluded from coverage but have the option to include themselves. Corporate officers are included in coverage, but may exclude themselves.
Subcontractors may be treated as employees and need to be covered under the general contractor’s policy, if they do not carry their own coverage. However, a general contractor may require subcontractors to maintain workers’ compensation insurance in order to avoid the liability of a claim from an uninsured subcontractor.
Related Read: Workers' Compensation for Sole Proprietors
The South Carolina Workers’ Compensation Commission defines an independent contractor as someone who:
According to a study by the Oregon Department of Consumer and Business Services, South Carolina ranks 14th in the nation for highest workers’ compensation costs. Employers in 2018 paid a rate of approximately $1.50 - $1.99 per $100 in payroll for workers’ compensation coverage.
The cost of workers’ compensation insurance is based on several factors. South Carolina workers’ compensation rates are recommended by the National Council on Compensation Insurance (NCCI), which many U.S. states use as their rating bureau. NCCI collects data on workplace injuries and advises rates for each class code, or industry, based on the relative risk to employees.
The workers’ comp rate, along with the company’s history of claims, years in business and other factors, are used to calculate the final premium. While rates are advised, the end quote for a workers’ compensation policy can vary from one insurance carrier to another.
To buy workers’ comp insurance in South Carolina:
South Carolina does not have a state-funded insurance option. If your business is having trouble finding coverage, contact NCCI and ask for the South Carolina assigned risk plan. NCCI administers the state’s assigned risk pool, and will place you with a carrier.
Editor’s note: Last updated December 28, 2018