What insurance is required when hiring workers?

Required Insurance When Hiring Employees in South Carolina

When hiring employees in South Carolina, businesses must ensure they have the necessary insurance coverage to comply with state regulations and protect their operations.

Workers' Compensation Insurance

Workers' compensation insurance is mandatory for most employers in South Carolina. This insurance covers medical expenses and lost wages for employees injured on the job.

• Required for employers with four or more employees, including part-time workers.
• Must be maintained continuously once coverage is required.
• Helps avoid penalties and potential lawsuits related to workplace injuries.

Unemployment Insurance

Employers must also register for unemployment insurance through the South Carolina Department of Employment and Workforce. This insurance provides temporary benefits to eligible workers who lose their jobs through no fault of their own.

• Employers pay state unemployment taxes based on payroll.
• Proper payroll recordkeeping is essential to manage contributions and reporting.

Additional Insurance Considerations

While not legally required, consider the following to support your workforce and business stability:

• General liability insurance to protect against third-party claims.
• Employment practices liability insurance to cover claims related to workplace discrimination or wrongful termination.
• Health insurance offerings, especially if your business has 50 or more full-time employees, to comply with federal Affordable Care Act requirements.

Operational Tips

• Verify insurance coverage before onboarding employees to ensure compliance.
• Maintain accurate employee classification to determine correct insurance obligations.
• Use payroll automation tools to track insurance tax payments and reporting deadlines.
• Regularly review insurance policies as your workforce grows or changes.