South Dakota car insurance requirements and laws

Minimum car insurance requirements

South Dakota law requires every driver or owner to keep financial responsibility in force at all times. Nearly everyone does this with an owner's liability policy at the limits in SDCL 32-35-70. The Insurance Code adds two more required coverages. SDCL 58-11-9 requires uninsured motorist (UM) coverage and SDCL 58-11-9.4 requires underinsured motorist (UIM) coverage. Both must match your bodily injury limits.

UM and UIM rise with your liability limits up to 100/300, and higher if you ask. They pay for injuries, not vehicle damage. Instead of insurance, the law also allows a surety bond, a $50,000 deposit or self-insurance for large fleets.

What the minimums mean in practice: suppose you hit a pickup at a rural intersection near Sioux Falls. The driver has $40,000 in medical bills and the truck needs $20,000 in repairs. Your policy pays $25,000 toward the injuries and $20,000 for the truck. The other driver can pursue you for the remaining $15,000 plus lost wages and pain and suffering. If the roles were reversed and the at-fault driver carried only 25/50, your UIM coverage would help with your injury costs above their limit, up to your own UIM limits. Check your numbers with the How much car insurance do I need?.

Fault system and what it means after a crash

South Dakota is an at-fault state. The driver who causes a crash pays, through their liability insurer, for the other side's injuries and damage, with no threshold on lawsuits.

South Dakota's comparative negligence rule (SDCL 20-9-2) is unusual. Your own negligence does not bar recovery only when it was "slight" compared with the defendant's negligence. Your damages are then reduced by your share. Juries decide whether a plaintiff's negligence was slight without being told any fault percentage. In practice, a driver who was meaningfully careless can recover nothing, which makes this rule stricter than the 50% or 51% bars in most states. See comparative vs contributory negligence and how fault is determined in a car accident.

Optional coverage worth considering here

• Higher liability limits. Because UM and UIM follow your bodily injury limits, raising liability to 100/300 also raises your own protection (how much liability coverage do you need?).
• Comprehensive. Hail, blizzards and deer collisions make comprehensive one of the most important coverages in the state (hail, flood and storm damage: filing a comprehensive claim).
• Collision, which you need for your own vehicle repairs because UM does not pay for vehicle damage.
• Medical payments and roadside assistance for long rural drives.

What drives rates in South Dakota

South Dakota is among the least expensive states. The NAIC's average expenditure was $936 in 2023, versus $1,281.60 nationally. Low population density and light traffic hold down liability claims. Severe weather drives up physical-damage costs: hailstorms, winter whiteouts and animal strikes on rural highways. The Insurance Research Council estimated just 9.4% of South Dakota drivers were uninsured in 2023, well under the national 15.4%. Insurers also look at your driving record, vehicle and credit-based insurance score.

Penalties for driving uninsured

Failing to maintain financial responsibility is a Class 2 misdemeanor under SDCL 32-35-113. It is punishable by up to 30 days in county jail, a $500 fine or both. On conviction the judge must also suspend your license for 30 days to one year (SDCL 32-35-121). During the suspension you may drive only for work, child care, medical appointments, school, court and similar purposes, and only after you obtain insurance and keep it in force (SDCL 32-35-122). Giving an officer false proof of insurance is a more serious Class 1 misdemeanor. If you can show you were insured when cited, you can present proof to the magistrate. See penalties for driving without insurance.

SR-22 and high-risk drivers

After serious violations such as a DUI, or after an uninsured crash, the Department of Public Safety may require proof of future financial responsibility before you can drive. This is commonly an SR-22 filed by your insurer. Ask the department what applies and for how long, and keep the policy active, because a lapse is reported. Compare several insurers, including nonstandard auto insurance carriers (SR-22 insurance explained, high-risk car insurance: options when insurers say no).

Insurers with a strong presence in South Dakota

State Farm, Progressive, American Family Insurance and GEICO all sell widely in the state. Regional options include Farm Bureau Financial Services, the Farm Bureau insurance group that serves South Dakota members (Farm Bureau insurance: membership, eligibility and how it works). North Star Mutual, a Minnesota-based mutual that writes home and auto insurance in South Dakota, sells through local agents.

Where to get help

The South Dakota Division of Insurance is at 124 South Euclid Avenue, 2nd Floor, Pierre, SD 57501. Call 605-773-3563 or email [email protected]. Online, it is at dlr.sd.gov/insurance. The division answers coverage questions and handles complaints against insurers and agents (how to file a complaint against a car insurance company). License suspensions are handled by the Department of Public Safety. The deadline to sue for personal injury is generally three years, and six years for property damage (statutes of limitations for car accident claims). Ask a licensed attorney about your claim.