Understanding Workers Compensation Costs in South Carolina

What Sets South Carolina Workers Compensation Apart

South Carolina uses a state‑administered rating system where the Workers Compensation Commission assigns experience rating classes and a base premium rate that reflects the state's overall risk pool. Employers pay a premium equal to the base rate multiplied by their payroll in the assigned class, then adjust for experience modifiers.

Base Premium Rates by Industry

Typical base rates (per $100 of payroll) vary widely:

• Construction: 1.2 – 2.5
• Manufacturing: 0.8 – 1.6
• Healthcare: 0.5 – 1.0
• Retail: 0.3 – 0.8

These figures are averages; actual rates depend on the specific classification code for each job function.

Experience Modification Factor (EMF)

The EMF adjusts the base premium up or down based on an employer's claim history compared to peers. A factor below 1.0 reduces costs, while a factor above 1.0 increases them. The calculation considers frequency, severity, and dollar loss of past claims.

Payroll and Minimum Premiums

South Carolina requires a minimum annual premium of $300 for any employer, regardless of payroll size. For larger firms, the premium scales with total covered payroll in each classification.

Additional Fees and Assessments

Beyond the base premium, employers may pay:

• Assessment fees for state insurance funds
• Unemployment insurance surcharge (if applicable)
• Late‑payment penalties

Sample Cost Calculation

For a construction firm with $500,000 payroll in the 5400 (General Construction) class and a base rate of 1.5, the raw premium is:

The final annual cost would be roughly $8,400, subject to any additional state fees.