South Carolina is known as the “Palmetto State”, named for the famous palms seen throughout the state. As the trees suggest, the subtropical climate and natural landscape make the state ideal for year-round trips. But it’s also an ideal place to start up or move your business.

Technically complex industries, like advanced manufacturing and materials, thrive in South Carolina.1 But that’s not all—per its 2020 Small Business Association Profile, economic growth is up and unemployment down, relative to national averages.2 To join the 431,835 small businesses booming in South Carolina, you’ll need insurance. From workers’ compensation insurance to liability coverage, in this guide we’re going to tell you what’s legally required and what comes highly recommended.

South Carolina business insurance requirements

In South Carolina, both business and personal insurance fall under the jurisdiction of the South Carolina Department of Insurance (SCDOI). SCDOI is “where production and regulation meet” and it exists to both help residents and businesses find insurance and enforce requirements that ensure fair coverage for all.

As with nearly every other state in the US, if you fall under a certain criteria as a business, you are legally required to purchase:

    • Workers’ compensation insurance
    • Auto liability insurance

However, finding success in the Palmetto State, as in others, often necessitates going above the minimum. Below, we’ll detail some other coverages most businesses should consider as well.

South Carolina workers’ compensation

Requirements for workers’ comp in South Carolina are actually less stringent than in other states. In particular, the default requirement is that most businesses with four or more regular employees (full- or part-time) need to cover them with workers’ comp insurance.

However, there are some exemptions3, including:

  • Agricultural workers and traders
  • Casual (“occasional”) workers
  • State and country fair workers
  • Certain railroad workers
  • Owner-operator drivers
  • Real estate agents working on commission

Importantly, a unique aspect of workers’ comp in South Carolina is that 1099 payment does not always exempt an employee from coverage.4 Contractors and non-W2 workers may need to be covered if their work for your business is regular.

If your business must cover its workers, you also need to post this information publicly—failure to do either can result in prosecution by the WCC.5

Auto insurance for businesses

If you use a vehicle for your business (or pleasure) in South Carolina, it will need to be insured. That’s because all drivers in South Carolina need liability insurance.

When it comes to a commercial auto insurance policy—or an auto insurance policy for business—your personal policy might suffice if you only use your car incidentally for business purposes. It comes down to what you use your vehicle for – transporting yourself, other people, or products. Additionally, who is listed as on the title of the vehicle matters. Let’s look at two examples.

For instance, Jerry is a handyman who uses his small truck to drive to and from job sites around town. As Jerry doesn’t transport people or products, his personal auto policy should cover him.

However, Jenny is a florist who delivers her creations (products) to her customers. As such, she likely needs a commercial auto policy.

Lastly, in almost all cases in which the business owns the vehicle, you’re going to need a commercial auto insurance policy. Regardless of your profession, we always recommend talking with your auto policy provider to ensure you’re fully protected.

Other types of South Carolina business insurance

If your South Carolina business has employees and uses vehicles, having workers’ comp and auto liability insurance will likely satisfy the minimum legal requirements.

But there are other forms of insurance that businesses in South Carolina should consider—beyond the minimums—if you want to ensure you have the right safeguards in place to keep operating smoothly:

  • General liability insurance
  • Professional liability insurance
  • Inland marine insurance (aka equipment insurance)
  • Commercial property insurance

Depending on the industry your business is in, you may be required to carry one or more of these coverages. And even outside a legal requirement, there are market reasons to carry them: keeping up with clients’ demands or showing proof of insurance can help you win bids on jobs.

At the end of the day, the most essential types of insurance are general and professional liability coverage.

Let’s take a closer look at each one.

General liability insurance in South Carolina

Your business in South Carolina will likely need general liability insurance if it involves any risk to clients or other third parties. For example, any business with a workplace prone to slips and falls, particularly around other hazards (sharp objects, etc.), is a place where customers are relatively likely to get hurt. And if they do, they may sue you.

When your business fields third-party claims, there are many costs involved. You’ll likely need to pay for investigation and defense at a minimum, as well as damages awarded or settlements reached as a result of a trial.

General liability insurance can help with the financial costs associated with third-party claims of:

  • Bodily injury
  • Property damage
  • Personal and advertising injury

To that end, depending on your profession, clients may expect you to carry general liability coverage.

However, to protect your business’ tools and equipment, you should consider taking inland marine insurance (you know insurance, confusing names). In an effort to simplify insurance, at Thimble we call inland marine what it is, Business Equipment Protection insurance (BEP). While traditional general liability insurance only protects you in the case that a third-party’s property is damaged, our monthly policies come equipped with an optional BEP add-on. This means you’re covered from both angles.

Professional liability insurance in South Carolina

Depending on the nature of your business and clientele, general liability might not be the only kind of liability coverage you need. If your business hinges on delivering expert services or goods to a client, such as consulting or photography, you should consider professional liability coverage, too.

Professional liability insurance can provide investigation and defense, and pay for damages or settlements, from third-party claims of financial loss due to:

  • Your negligence (alleged or actual)
  • Failure to provide professional services
  • A lapse in your professionalism that harmed the client

At the end of the day, all it takes is a client alleging you harmed them for you to face potentially large damages in court—it doesn’t matter if the claim holds merit!

You shouldn’t need to live and work in fear of lawsuits from your clients. Professional liability insurance can help alleviate these concerns, providing peace of mind.

How to get South Carolina business insurance

The kinds of business insurance you need in South Carolina vary depending on the nature of your business. If you employ workers regularly, you may need workers’ compensation insurance; if you use vehicles, you may need personal or commercial auto insurance. If you have an office space or retail location, you likely also need commercial property insurance.

No matter what, you should also look into general liability and professional liability coverages. Whether or not they’re required, they can provide essential protection from third-party claims, as well as potential competitive advantages, so you can focus on growing your business.

Here at Thimble, we’re simplifying small business insurance—for those in South Carolina and all across the US. We offer affordable on-demand liability insurance, tailored to your business’s needs. Click on “Get a Quote,” answer a few questions, and you can purchase insurance by the hour, day, or month, all in 60 seconds or less.

Our insurance works when you do, so you can save money and focus on growing your “Palmetto State” business from the ground up. We’re rooting for you!


  1. South Carolina Dept. of Commerce. Industries.
  2. U.S. Office of Small Business Administration. South Carolina Small Business Economic Profile.
  3. Workers’ Compensation Commission. Coverage Requirements and Statute References.
  4. Workers’ Compensation Commission. Coverage and Compliance FAQs.
  5. Workers’ Compensation Commission. Coverage/ Compliance.