South Carolina requires most businesses to carry workers' compensation insurance once they reach four employees. Unlike Texas, which allows most private employers to opt out entirely, or Florida, which sets the same four-employee threshold, South Carolina has a clear mandate with specific penalties for non-compliance and clear rules about who is and isn't covered.
For Myrtle Beach and the Grand Strand — where seasonal hiring in hospitality, food service, construction, and recreation can push headcount past four employees quickly during peak season — understanding exactly when the requirement kicks in and what it covers is essential to running a compliant operation.
Is workers comp required in SC
Yes. South Carolina law requires workers' compensation insurance for employers with four or more employees, including part-time workers and family members on payroll. Both full-time and part-time workers count toward the threshold. A Myrtle Beach restaurant with three full-time kitchen staff and two part-time servers has five employees for workers' comp purposes and must carry coverage.
Several categories are exempt: agricultural employees performing farm work, casual employees hired for occasional incidental work unrelated to the employer's primary business, domestic workers in private homes, and businesses with an annual payroll under $3,000. For most operating businesses with actual staff, these exemptions don't apply.
The South Carolina Workers' Compensation Commission (wcc.sc.gov) is the authoritative source for current requirements. General contractors in South Carolina face specific exposure: if a subcontractor doesn't maintain their own workers' comp coverage, the general contractor may be liable for benefits to the subcontractor's injured employees. Requiring certificates of insurance from every subcontractor before work begins is standard practice in the Myrtle Beach construction market for this reason.
What workers comp covers in SC
Workers' compensation is a no-fault system. When an employee is injured on the job or develops a work-related illness, they receive benefits through the policy regardless of fault. In exchange, employers receive exclusive remedy protection — the employee's claim is generally their only remedy, and they can't sue the employer in most circumstances.
Medical benefits: All necessary treatment for work-related injuries — doctors, hospitals, surgery, physical therapy, prescriptions. South Carolina has no cap on medical benefits for as long as treatment is medically necessary.
Temporary disability benefits: Pay 66.67% of the employee's average weekly wage during the period they can't work. South Carolina's maximum weekly compensation rate was $1,134.43 for 2025. The 7-day waiting period before income benefits begin is retroactive if the disability extends beyond 14 days.
Permanent disability benefits: Based on impairment ratings for injuries that result in lasting limitations. Permanent total disability can qualify for lifetime benefits in serious cases.
Death benefits: Burial expenses and ongoing support for eligible surviving family members when a work-related injury results in death.
How workers comp rates are calculated in SC
Workers' comp premiums in South Carolina are calculated as a rate per $100 of payroll, multiplied by the NCCI classification code for each job type, adjusted by your experience modification factor (EMR). The EMR compares your actual claims history to expected claims for your industry — a clean record produces a sub-1.0 EMR (which reduces premium) and a history of claims produces an EMR above 1.0 (which increases it).
Classification codes reflect the risk level of specific job duties. A Myrtle Beach hotel's front desk staff and its housekeeping crew have different class codes and different rates per $100 of payroll, because their injury risk profiles are different. Getting classifications right is one of the most directly controllable premium factors — misclassified employees can produce both overpayment and audit penalties.
South Carolina workers' comp rates averaged $1.30 per $100 of payroll statewide in recent years, with significant variation by industry. Office and administrative work runs well below $1.00. Roofing and heavy construction run significantly higher. The average monthly cost for small businesses comes in around $55 to $70, though hospitality, construction, and other higher-risk industries in the Grand Strand market pay more.
Filing a workers comp claim in SC
When an employee is injured, South Carolina employers must report the injury to their insurer promptly — typically within 10 days. The insurer has specific obligations to acknowledge the claim and begin managing it. Medical treatment must be authorized through approved treating physicians in most cases.
Failing to have required coverage when a claim occurs produces double exposure: penalties from the SC Workers' Compensation Commission and direct personal liability for all medical costs, wage replacement, and disability benefits that workers' comp would have covered. In a serious injury case in the tourism industry — where physical work environments generate real injury risks — that uninsured exposure can reach hundreds of thousands of dollars.
Get a workers comp quote for your Grand Strand business
L.W. Short Insurance Agency works with Myrtle Beach and Grand Strand employers across hospitality, construction, retail, and professional services to find competitive workers' compensation coverage. For a free quote, contact us through our business insurance page or call (866) 786-7484. We serve businesses throughout Myrtle Beach, North Myrtle Beach, Murrells Inlet, Surfside Beach, Conway, Pawleys Island, Litchfield, and Georgetown.
