Charleston Workers' Compensation Insurance

Your Complete Guide to Charleston, SC, Workers' Compensation Insurance

Are you required to provide workers' compensation insurance to your Charleston, SC, employees?

Charleston South Carolina Workers Compensation Insurance

Do you own a business in South Carolina that employs more than four employees? Are you required by law to provide workers’ compensation to your employees? What is the cost of workers’ compensation in the state of South Carolina? If you want the answer to any of those question, then stick around to find out more.

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What Is Workers' Compensation Insurance?

Workers' compensation insurance is also known as workman's compensation and it provides benefits to employees who get injured or sick from a work-related source. It also includes disability benefits, missed wages, and death benefits

The Workers' Compensation Act in South Carolina stipulates that if an employee is injured by an accident occurring while employed, that individual is eligible to recover medical expenses, missed wages, and permanent disability benefits if they suffered a permanent injury as a result of a work-related accident.

A workers’ compensation insurance company can deny coverage for certain claims, such as willfully self-inflicted injuries, injuries occurring while the injured employee is under the influence of drugs or alcohol, injuries occurring during voluntary events outside of work, and injuries occurring while the injured employee is in the act of committing a felony.

Is Workers’ Compensation Insurance Required in Charleston, SC?

In South Carolina, if you employ at least four employees, you are required to have workers' compensation insurance. If an employee becomes hurt on the job and the employer did not have the required workers’ compensation insurance in South Carolina, the state could take the business assets to cover the cost of a claim.

Although South Carolina requires employers with at least four employees to have workers' compensation insurance, there are few exceptions, including the following:

  • Employers with less than $3,000 in annual payroll for the previous year
  • Casual employees, who do not work regular hours
  • Federal employees of the state
  • Agricultural employees
  • Railroad or railway express company employees
  • People selling agricultural products
  • Licensed real estate agents working for a broker

The Workers’ Compensation Statute of Limitations in South Carolina

In South Carolina, it is the employee’s responsibility to notify the employer of an injury as soon as possible, but it must be within 90 days of the injury. The injured employee must file a claim within two years with the WCC.

Additionally, if the employee neglects to inform either the employer or the Workers’ Compensation Commission (WCC) on time, they forfeit their right to make a claim. Furthermore, it is the employer’s responsibility to buy the right workers’ compensation coverage through a licensed insurance company.

What Are the Basics of the Workers’ Compensation Law in Charleston, SC?

In South Carolina, the Workers' Compensation Act provides that if an employee is injured or gets sick while on the job, they are entitled to certain benefits.

What Is Covered?

Disability benefits: Workers’ compensation insurance provides coverage to employees for medical costs associated with work-related injuries or illnesses, including emergency room visits, required surgeries, and treatments.

Under the current South Carolina law, the employer can select the doctor that treats the employee. If the employee goes to their own doctor without permission of the employer, the employer might not be held legally responsible for medical expenses. However, the employee has the right to choose a physician to evaluate them for the specific disability, but it will not be covered by the employer.

Missed wages: If an employee gets injured or sick on the job, workers’ compensation can help replace their lost income if they must take time off.

Ongoing care: Sometimes work-related injuries or illnesses can be bad enough to warrant multiple doctor visits. Workers’ compensation insurance can help cover their ongoing care costs, such as physical therapy.

Funeral costs: If an employee loses their life while on the job, workers’ compensation coverage can help pay their funeral costs and provide death benefits to the employee’s beneficiaries.

Let’s say your head of security loses the use of one of their arms and is partially disabled because of a work-related accident. They are not able to return to work and need continued medical and financial support. Workers’ compensation insurance can help cover treatment costs and supplement some of their missed wages through disability benefits.

Who Is Covered?

There are several factors that determine which employees need workers’ compensation insurance. For instance, specific positions and the size of a business play a big role. Although requirements vary from state to state, most require workers’ compensation coverage for full-time employees. Some states do not require workers’ compensation coverage such as the following positions:

  • Casual workers
  • Farmhands
  • Business owners and partners
  • Insurance agents
  • Family members under a certain age
  • Real estate agents
  • Federal government employees

These exceptions do not apply to every state, so be sure to understand your state’s workers’ compensation laws.

How Do I Determine the Workers’ Compensation Insurance Cost for My Charleston, SC, Business?

A workers’ compensation insurance quote will be based on four main components: classification code (industry), claims history, location, and payroll.

  • Classification code: Your business is calculated based on the jobs performed and the potential risk for physical illness or injury.
  • Claims history: Your claims history is used to assess how safe your work environment is and how likely you are to have claims in the future. Any claim, no matter the size, will affect your premium. Equally, a lack of past claims indicates a safe work environment and may lower your premium.
  • Location: Workers’ compensation is controlled at the state level, which means rules and rates will vary from one state to another.
  • Payroll: Although the state requirements for coverage depends on the number of employees you have, premiums are based on total payroll, including full-time, part-time, and temporary or seasonal workers. 
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South Carolina Workers’ Compensation 2020 Base Rate Examples

Most of the time, benefits are calculated and paid based on an employee’s average weekly wage. This is calculated by multiplying the employee's daily wage by the number of days worked in a full year. That number is then divided by 52 weeks to get the average weekly wage.

Then, you add together the benefit and incentive costs, hiring, salary, and payroll taxes to ascertain the total compensation costs. If you want to find the monthly compensation expense, compute the quarterly or annual costs and in turn divide by 3 or 12.

Listed below are some sample base rates (rate per $100 of employer payroll) as of 4-1-2020. These rates are published annually by the South Carolina Department of Insurance and are subject to change every year.

  • 0035 Florists and drivers: $1.96
  • 5183 Plumbing: $2.45
  • 5551 Roofing: $18.12
  • 8017 Retail Store: $1.20
  • 8810 Clerical: $0.14
  • 9079 Restaurant NOC: $1.10
  • 2701 Logging or tree removal: $11.62

What Is an Experience Rating and How Does It Affect My Costs?

In South Carolina, some larger companies are assigned an experience modification factor or experience mod. This factor can affect your South Carolina workers' compensation premium.

Your experience mod provides a sign of how your safety record and workers’ compensation claims compare to other businesses of your size in your industry. Companies with a higher experience mod will pay higher premium rates.

Experience Rating Eligibility (EMR): South Carolina employers will receive an experience modification rate or EMR once they meet one of these triggers:

  • $9,000 in policy premium is generated during the last year or last two years
  • $4,500 is the average policy premium generated for more than two years

If your workers' compensation policy is experience-rated, your payments are determined with the following formula:

  • Base Rate X Payroll X Mod = Premium

Your modification rating represents a debit or credit that will be applied to your workers’ compensation base premium accordingly.

  • A mod of 1.0: This is an average rating and is where all businesses start when they are experience-rated. A mod of 1.0 will not affect your premium rates.
  • A mod greater than 1.0: This is also referred to as a debit mod. It signifies that your company’s injury occurrence and severity rate is worse than expected for a company of your size in your industry. Your payments will increase according to your experience mod.
  • A mod less than 1.0: This is also referred to as a credit mod. It signifies that your company’s injury frequency and severity rate is better than expected for a company of your size in your industry. Your premiums will be discounted according to your experience mod.

Accidents at your place of business can influence your experience modification rating for three years. Consequently, years without any workers' compensation claims will cause your modification factor to drop.

Get Help Securing a Charleston, SC, Workers’ Compensation Policy

You can protect your company from the risk of hefty liability judgments by investing in a qualified South Carolina workers’ compensation insurance policy. Having this coverage may even make your business more appealing to talented employees.

You can learn more about your options and easily review rates by working with a local independent insurance agent. These independent agents are available to answer your insurance-related questions and help you find the best companies to meet your coverage needs. Find an agent near Charleston, SC, to get more information.

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