South Carolina’s vibrant business community is powered by over 430,000 small businesses, representing more than 99% of all companies in the state. Whether you’re a startup in Charleston or an established company in Greenville, understanding your insurance requirements is essential for legal compliance and business protection.

Who Needs Business Insurance in South Carolina

While not every type of business insurance is required by law, nearly every South Carolina business benefits from some form of coverage. Key points:

• Businesses with four or more employees (full-time or part-time, including family members) must carry workers’ compensation insurance.

• Any business that owns or uses vehicles for work must have commercial auto insurance.

• Professionals providing specialized services (e.g., consultants, healthcare, legal, architects, IT) should consider professional liability insurance, often required by contracts or licensing bodies.

• Businesses leasing property, working with clients, or seeking licenses may be required by landlords or contracts to carry general liability or property insurance.

• All businesses should consider insurance to protect against lawsuits, property damage, data breaches, and business interruptions.

Workers’ Comp: When It’s Required

South Carolina law requires businesses with four or more employees to carry workers’ compensation insurance. This includes part-time workers and family members. Exemptions include:

• Businesses with fewer than four employees or payroll under $3,000/year

• Certain agricultural employees, casual employees, state/county fair associations, railroads, and federal employees

• Some owner-operators and specific commission-based real estate agents

Non-profit organizations are not exempt; if they have four or more employees, they must comply.
Penalties for non-compliance can include fines, business closure, and liability for workplace injuries.

Commercial Auto Insurance Basics

All business-owned vehicles in South Carolina must have commercial auto insurance.
Minimum required coverage:

• Bodily injury: $25,000 per person / $50,000 per accident

• Property damage: $25,000 per accident

• Uninsured motorist coverage matching liability minimums

Who needs it: Any business that owns, leases, or uses vehicles for business purposes-including contractors, delivery services, food trucks, and rideshare vehicles.
Personal auto policies do not cover business use. If employees use personal vehicles for work, consider hired and non-owned auto insurance (HNOA).

Penalties for non-compliance: Fines, license/registration suspension, and possible jail time.

Professional Liability for Certain Jobs

Professional liability insurance (errors & omissions/E&O) is not required by South Carolina law for most businesses, but is strongly recommended-and often required by clients or licensing boards-for those providing professional services:

• Accountants, attorneys, financial advisors, real estate agents

• IT consultants, architects, engineers, healthcare professionals, insurance agents, web designers, construction contractors

Covers: Claims of negligence, errors, omissions, or wrongful acts in professional services.
Does not cover: Intentional wrongdoing, bodily injury, property damage, or workers’ comp claims.

Is General Liability Insurance Mandatory?

General liability insurance is not required by South Carolina law for most businesses.
However, it is:

• Often required by landlords, lenders, or commercial leases.

• Strongly recommended for all businesses to protect against third-party bodily injury, property damage, and legal claims.

• Sometimes required for certain licenses or contracts.

Typical cost: About $44 per month for small businesses in South Carolina.

Other Useful Coverages for Businesses

South Carolina businesses should consider these additional policies for comprehensive protection:

• Business Owner’s Policy (BOP): Bundles general liability and property insurance for cost savings.

• Commercial Property Insurance: Covers buildings, inventory, and equipment.

• Business Interruption Insurance: Replaces lost income after a covered disaster.

• Cyber Liability Insurance: Protects against data breaches and cyberattacks.

• Umbrella Insurance: Increases liability limits above existing policies.

• Employment Practices Liability: Covers claims of wrongful termination, discrimination, or harassment.

• Inland Marine Insurance: Covers tools, equipment, and property in transit.