Sole Proprietor Workers Compensation in South Carolina
South Carolina sole proprietors and partners are not required to carry workers compensation on themselves under SC Code 42, but can elect coverage by filing Form 21 with the SC Workers' Compensation Commission. Most general contractors in Greenville require sole-proprietor subcontractors to either carry workers comp or sign a written waiver before the contract can be signed.
Does an SC sole proprietor need workers comp?
South Carolina sole proprietors are not required to carry workers compensation on themselves by state law, even when they have employees (they would need coverage for the employees but not for the owner). However, sole proprietors who want coverage for themselves can elect to be included by filing Form 21 with the SC Workers' Compensation Commission. Most general contractors in Greenville require sole-prop subs to either carry coverage or sign a waiver.
How does an SC sole proprietor elect workers comp?
South Carolina sole proprietors elect to be covered by workers compensation by filing Form 21 (Election by Sole Proprietor or Partner to Be Subject to the South Carolina Workers' Compensation Law) with the SC Workers' Compensation Commission. The election applies prospectively and continues until revoked in writing. Premium for the sole proprietor is rated on a deemed annual wage (typically $30,000 to $80,000) at the applicable NCCI class code rate.
What does sole proprietor workers comp cost in SC?
South Carolina sole proprietor workers compensation, when elected, is rated on a deemed annual wage that the proprietor selects (typically $30,000 to $80,000) multiplied by the NCCI class code rate. An SC carpenter sole proprietor electing $50,000 deemed wages under NCCI 5645 ($5-8 per $100) would pay $2,500 to $4,000 per year for self-coverage. Higher-hazard classes (roofing 5551) cost significantly more even at the same deemed wage.
Why do SC GCs require sole proprietor subs to have workers comp?
South Carolina general contractors require sole-proprietor subcontractors to either carry workers compensation or sign a written waiver because if the sub is injured on the GC's job site, the GC's workers comp policy may be charged for the sub's injury (the SC Workers' Compensation Commission can reclassify uninsured subs as employees). Requiring sub coverage or a waiver protects the GC's experience modifier and audit costs.
Can SC sole proprietors waive workers comp on a contract?
Yes. South Carolina sole proprietors and partners can sign a written waiver of workers compensation when contracting with a general contractor, stating they are not subject to coverage under SC law because they have not elected coverage and have no employees. The waiver is enforceable but the GC still bears some risk if the sub is reclassified as an employee. Many GCs prefer subs carry coverage to eliminate the reclassification risk entirely.
About The Morgano Agency
The Morgano Agency Inc is an independent insurance agency in Greenville, South Carolina, founded in 1998 by Vic Morgano. The agency compares rates from multiple carriers including Travelers, Liberty Mutual, Progressive, Hartford, Safeco, and Hagerty for families and businesses across Greenville County and the Upstate. Visit our workers comp page or call (864) 609-5285 for a quote. Find the agency on Google Maps.