South Carolina's business landscape is booming. From the BMW manufacturing corridor in Spartanburg to the tourism hotspots along the coast, the Palmetto State hosts over 432,000 small businesses. Whether you're opening a beachside restaurant in Myrtle Beach, running a manufacturing supplier in the Upstate, or launching a tech startup in Charleston, understanding your insurance needs isn't just about checking boxes—it's about protecting what you're building.
Here's what surprises most South Carolina business owners: the insurance you're legally required to carry is just the starting point. The real question is what risks your specific business faces, and that depends heavily on where you are and what industry you're in.
What Business Insurance Is Required in South Carolina?
Let's start with what the law actually requires. If you employ four or more people—and yes, that includes part-timers and family members—you must carry workers' compensation insurance. This isn't negotiable. The coverage protects your employees if they get injured on the job and shields your business from potentially devastating lawsuits. Average cost in South Carolina? About $74 per month, though that varies significantly based on your industry and payroll.
If you're a general contractor, here's something crucial: you're on the hook for your subcontractors' workers if they don't have their own coverage. Many contractors have learned this the hard way when a subcontractor's uninsured employee got hurt on their job site.
Commercial auto insurance is the other legal requirement if you have business-owned vehicles. South Carolina mandates minimum coverage of $25,000 per person and $50,000 per accident for bodily injury liability, plus uninsured motorist coverage. That company van or fleet of delivery trucks? They need commercial policies, not personal auto insurance.
The Coverage Your Lease Probably Requires
General liability insurance isn't legally required by the state, but pull out your commercial lease and you'll almost certainly find it there. Landlords aren't taking chances with slip-and-fall claims or property damage, so they require tenants to carry coverage—typically $1 million per occurrence. The good news? At an average of $44 per month in South Carolina, it's one of the more affordable protections you'll buy.
General liability covers the big three: bodily injury, property damage, and personal injury claims. A customer trips over a cord in your office and breaks their arm? That's covered. Your employee accidentally damages a client's property during a service call? Covered. Someone claims your advertising injured their reputation? Also covered. These are the everyday risks every business faces, regardless of industry.
Insurance Needs for South Carolina's Key Industries
Manufacturing and the BMW Corridor
If you're part of the manufacturing ecosystem along I-85—particularly in Spartanburg and Greenville counties—you're operating in one of the Southeast's most dynamic industrial regions. BMW's Spartanburg plant alone generates $26.7 billion in annual economic impact and supports nearly 43,000 jobs statewide. The plant exported over $10 billion worth of vehicles in 2024, making it the nation's largest automotive exporter.
For manufacturers and suppliers, product liability insurance is essential. If a component you produce fails and causes injury or property damage downstream, you need protection. Commercial property insurance matters too—your equipment, inventory, and building represent significant capital investment. Consider business interruption coverage as well; if a fire shuts down your operation for three months, will you survive without revenue?
Coastal Tourism and Hospitality
Running a business along South Carolina's coast means dealing with risks that Upstate businesses don't face. Hurricane season is real, and standard business insurance policies specifically exclude flood damage. If you're in Myrtle Beach, Charleston, Hilton Head, or any coastal community, flood insurance through FEMA's National Flood Insurance Program isn't optional—it's essential. Don't wait until hurricane warnings start to think about this.
Hotels, restaurants, and tourism businesses also need liquor liability coverage if you serve alcohol, and many coastal businesses benefit from specialized seasonal business insurance that adjusts coverage during peak summer months when both revenue and risks spike.
Professional Services and Tech
If you provide professional advice or services—consulting, accounting, legal, IT, marketing, real estate, architecture—you need professional liability insurance, also called errors and omissions (E&O) coverage. At an average of $66 per month in South Carolina, it protects you when a client claims your advice or work caused them financial harm. Your clients and professional licensing boards increasingly require proof of this coverage before you can work.
Cyber liability insurance is another must-have if you handle customer data, credit card information, or sensitive business information. A single data breach can cost tens of thousands in notification costs, credit monitoring, legal fees, and regulatory fines. This coverage is no longer just for big corporations.
The Smart Way to Bundle: Business Owners Policies
Here's where most small business owners can save money and simplify their lives: the Business Owners Policy, or BOP. This bundles general liability and commercial property insurance into one package. In South Carolina, the average BOP costs about $57 per month for businesses with fewer than 10 employees—significantly less than buying each coverage separately.
A BOP typically includes business interruption coverage, which replaces lost income if you have to temporarily close due to a covered loss. It often covers your business equipment, inventory, furniture, and the building itself if you own it. For most retail shops, offices, and small service businesses, a BOP is the foundation of a solid insurance program.
Getting Started: What to Do Now
Start by identifying which coverages are non-negotiable for your business: legally required insurance, lease requirements, and client contracts. Then think about your specific risk exposure based on your location, industry, and operations. A manufacturing supplier in Greer has different needs than a beach rental company in Folly Beach.
Work with an independent insurance agent who understands South Carolina's business landscape. They can access multiple carriers, compare coverage options, and help you find the right balance between protection and cost. The few hundred dollars a month you spend on proper insurance could save your business from a six-figure disaster.
South Carolina's economy is growing, opportunities are abundant, and your business is part of that story. Make sure you're protected so you can focus on what you do best—growing and serving your customers.
