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Workers’ Compensation Insurance Requirements in South Carolina
South Carolina requires workers’ comp once you reach 4 employees, and uninsured-sub liability can shift up the chain to general contractors — Trade Safe helps you stay covered and compliant.
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Workers’ Compensation Insurance Requirements in South Carolina
South Carolina’s 4-employee threshold gives small contracting outfits a narrower compliance window than neighboring states, but that doesn’t eliminate risk below it — general contractors who hire uninsured subs can still end up liable under the state’s statutory-employer rule. With roofing ranked among the top-priced trades nationally, South Carolina contractors have real incentive to get coverage structured correctly.
South Carolina Workers’ Compensation Legal Requirements
South Carolina requires workers’ compensation coverage once an employer has 4 or more regular employees, whether full-time or part-time, under Title 42 of the South Carolina Code.
- Coverage required at 4 or more regular employees, full-time or part-time — family members on payroll count toward the total
- Exemptions exist for businesses with fewer than 4 employees, payroll under $3,000/year, and certain casual or agricultural workers; sole proprietors and partners are not automatically covered and must affirmatively elect coverage
- Noncompliance penalties run $1/employee/day of violation (minimum $10, maximum $100/day), and the Workers’ Compensation Commission can double penalties for continued violations and issue stop-work orders
- Under S.C. Code §42-1-415, if a subcontractor misrepresents having coverage but doesn’t, liability can shift to the higher-tier contractor — always collect a sub’s insurance certificate before work begins
How South Carolina’s Workers’ Comp System Works
System type: Private Carrier Market
South Carolina is a private-carrier state with no state fund — employers buy coverage directly from licensed private insurers, and the Workers’ Compensation Commission regulates and administers claims but does not sell policies. Per the Oregon DCBS 2024 rate ranking study, South Carolina’s overall index rate ranks 29th of 51 states, about 6% below the national median, placing it squarely in the middle of the national pack.
How South Carolina’s Rates Compare by Trade
| Trade (NCCI Class Code) | National Rank (of 51) | Rate per $100 of Payroll |
|---|---|---|
| Roofing (Class 5551) | 6th of 51 | $17.19 |
| Electrical Wiring (Class 5190) | 9th of 51 | $3.09 |
| Plumbing NOC (Class 5183) | 30th of 51 | $2.58 |
Source: Oregon Dept. of Consumer and Business Services, 2024 Workers’ Compensation Premium Rate Ranking Study (published June 2025) — the only study benchmarking all 50 states plus DC on a common industry mix.
Filing a Workers’ Comp Claim in South Carolina
An injured employee should notify their employer promptly, and the employer or its carrier files the required forms with the South Carolina Workers’ Compensation Commission. Disputed claims are adjudicated administratively by WCC commissioners or hearing officers rather than through the court system, with benefits covering medical treatment, wage-replacement, and death benefits where applicable.
Penalties for Non-Compliance
Under South Carolina law, operating without required coverage carries fines of $1 per employee per day of violation (minimum $10, maximum $100 per day), and the Workers’ Compensation Commission can double penalties for continued noncompliance and shut down a business immediately via stop-work order.
Resources: SC Workers’ Compensation Commission, SC WCC Employer FAQs, SC LLR Contractor’s Licensing Board
How Much Does Workers’ Comp Insurance Cost in South Carolina?
South Carolina’s roofing rate ranks among the highest in the nation, while plumbing sits closer to the middle of the pack — a sharp cost split contractors should factor into bids.
| Trade | Estimated Cost per $100 Payroll | What Drives It |
|---|---|---|
| Roofing | $17.19 (per the Oregon study’s Class 5551 rate) | Ranked 6th-highest nationally, reflecting significant fall-risk exposure and claims severity in the state |
| Electrical | $3.09 (per the Oregon study’s Class 5190 rate) | Ranked 9th-highest nationally, notably elevated compared to South Carolina’s plumbing rate |
| Plumbing | $2.58 (per the Oregon study’s Class 5183 rate) | Mid-pack nationally at 30th of 51, comparatively moderate relative to the state’s other trades |
What Moves the Price Up or Down
- Whether your business meets or exceeds the 4-employee mandatory-coverage threshold
- Your experience modification factor based on claims history relative to industry peers
- Total payroll, since premium is calculated per $100 of payroll
- Verified subcontractor coverage — under §42-1-415, an uninsured sub’s liability can pass to you, effectively raising your real cost of risk
Rates shown are drawn from the Oregon DCBS 2024 Workers’ Compensation Premium Rate Ranking Study, a national benchmarking study. Actual premium depends on your experience modification factor, claims history, and payroll — get a personalized quote from Trade Safe for your exact cost.
Frequently Asked Questions
How many employees trigger mandatory workers’ comp in South Carolina?
South Carolina requires coverage once an employer has 4 or more regular employees, whether full-time or part-time — below that threshold, coverage isn’t mandatory but can still be purchased voluntarily.
Is there a special rule for licensed residential builders?
No — while workers’ comp coverage can factor into licensing decisions by the Residential Builders Commission, there is no separate lower employee-count mandate for licensed contractors; the standard 4-employee threshold applies.
What happens if my subcontractor lies about having coverage?
Under S.C. Code §42-1-415, if a subcontractor misrepresents that it has workers’ comp coverage and doesn’t, liability can shift up the chain to the general contractor or project owner — collecting a valid certificate of insurance up front is the best protection.
What’s the penalty for not carrying required workers’ comp in South Carolina?
Fines run $1 per employee per day of violation (minimum $10, maximum $100 per day), and the Commission can double penalties for continued noncompliance or issue an immediate stop-work order.
Workers’ compensation requirements can change with new legislation — always verify current rules with the South Carolina Workers’ Compensation Commission before making coverage decisions.
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