South Dakota Life Insurance

South Dakota life insurance laws deal primarily with claims issues. However, familiarizing yourself with some basic regulations is still key to making wise coverage decisions.

This page:

  • Briefly describes South Dakota life insurance regulations.

  • Explains the South Dakota Guaranty Association's protection.

  • Links to more information on life insurance in South Dakota

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South Dakota life insurance rights and regulations

The insurance industry in South Dakota is regulated under Title 58 of the South Dakota Codified Laws. These laws outline claims procedures and policy requirements for the benefit and protection of you, the consumer.

One such consumer protection is the 10-day "free look" provision all South Dakota life insurance policies must carry. During this window, a new policyholder can choose to decline the coverage and still receive a full premium refund. Some insurers offer a 30-day period, so check your new policy.

Insurance companies in South Dakota are also obligated to settle life insurance claims within 2 months of receipt of proof of death. An insurers may pay interest on policies that take longer to settle, but because insurers are free to set their own settlement procedures, this won't always be the case. (Your policy will specify your insurer's settlement procedure.)

The privacy of South Dakota policyholders is protected by law. Your life insurance company is not allowed to disclose medical information to other insurers. But it is obligated to honor your requests for medical information.

However, South Dakota law extends some protections to insurers, too. Consumer misrepresentation on a policy or application, if discovered within the first two years of the policy, can result in its cancellation. The insurer won't be obligated to honor any claims.

A misstatement of age can be discovered at any time and will result in the reduction of death benefits to reflect the actual age of the insured.

South Dakota insurers are also exempt from paying claims made within the first two years where suicide is the cause of death. (Premiums will be refunded, however.)

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If you are ready to apply for a South Dakota term life insurance policy, or if you just want a quick online quote, visit Efinancial now.
If you are not sure about what type of life coverage you want, you can also try InsureME. They will put you in touch with agents who can answer any questions that you might have.

The South Dakota Life Insurance Guaranty

Licensed insurance companies in South Dakota pay annual fees to the South Dakota Life and Health Insurance Guaranty Association. This organization is designed to protect insurance consumers, like you, by helping cover policies lost through insurance company insolvency.

However, there are restrictions on this protection. In South Dakota the compensation for lost death benefits is limited to $300,000 per insured individual. This limit applies even in the event of multiple policies with a higher total coverage.

And your insurer must be licensed in South Dakota to qualify for the guaranty's backing. To check the status of an insurer, you can call the South Dakota Division of Insurance at 605-773-3563.

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Apply for a quote with confidence at Efinancial
(for South Dakota term life insurance), or InsureME.
Your insurer will be licensed in South Dakota.

Other notes on South Dakota life insurance

Viatical settlements, which are purchasing agreements between an insured and a third party, are allowed in the state of South Dakota. Under these arrangements, a third party buys a life insurance policy from the insured, pays the premiums, and becomes the policy's benefiary. In South Dakota these settlements are handled by the Securities Division.

Insurance illustrations, which are financial projections made by an insurance company, are also permitted South Dakota, but their content is regulated.

More SD life insurance help

If you want more help getting the best value on your SD life insurance policy, start with our guide to term life insurance or sign-up for our free life insurance course (see below).

To find out more about SD life insurance laws and regulations, visit the official website of the South Dakota Department of Commerce & Regulation, Division of Insurance.

Learn even more:

Getting the lowest possible premium on your life insurance is almost like an art form. There are many variables to consider, and to get the right balance of term length, benefit amounts, and policy riders and illustrations, you need to take a careful step-by-step approach to the buying process.

Our free life insurance course is designed to help you do just that.

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