South Dakota is an at-fault (tort) auto state. Its rules sit on top of the standard Personal Auto Policy covered in the national guide. They cover financial responsibility, mandatory uninsured and underinsured motorist coverage, cancellation and nonrenewal, and the assigned risk plan. The sources are SDCL chapter 32-35 (financial responsibility) and SDCL 58-11 (auto insurance).

Financial responsibility (SDCL 32-35)

• Owners and drivers must keep financial responsibility at all times. Failing to do so is a Class 2 misdemeanor (32-35-113).
• Minimum liability limits: 25/50/25 (32-35-70):
  • $25,000 bodily injury per person
  • $50,000 bodily injury per accident
  • $25,000 property damage per accident
• Example: two people are hurt, with $40,000 and $20,000 in damages. The policy pays $25,000 and $20,000, for $45,000 total within the $50,000 per-accident limit.
• An owner's policy must cover anyone driving with the named insured's express or implied permission (32-35-70).
• Ways to show financial responsibility (32-35-113):
  • an owner's liability policy
  • a bond
  • a $50,000 certificate of deposit
  • a certificate of self-insurance
• When stopped, the driver shows the insurer's name and the policy number (32-35-114, 32-35-115).
• Giving false evidence, such as an expired policy number, is a Class 1 misdemeanor (32-35-120).
• Proof of future responsibility: drivers convicted of certain offenses must file proof with the Department of Public Safety (32-35-65).
  • A binder issued pending the policy counts as proof (32-35-79).
  • The insurer must tell the Department within 15 days when a certified policy is cancelled (32-35-80).
  • The proof may be cancelled after 3 years if there are no disqualifying convictions (32-35-95).

Uninsured and underinsured motorist coverage (SDCL 58-11-9 to 58-11-9.8)

• Uninsured motorist (UM) coverage must be included in every auto bodily injury liability policy, at limits equal to the BI limits (58-11-9).
  • It covers uninsured and hit-and-run vehicles.
  • The insurer doesn't have to include more than $100,000/$300,000 unless the insured asks for more.
  • Snowmobiles and government-owned vehicles are exempt.
• A vehicle whose liability insurer is insolvent counts as uninsured (58-11-9.1).
• Underinsured motorist (UIM) coverage is also required, equal to the BI limits, with the same 100/300 cap unless more is requested (58-11-9.4).
• UIM payment = your UIM limit minus what the at-fault driver's insurer paid (58-11-9.5).
  • Example: a $100,000 UIM limit and a $25,000 payment from the at-fault insurer leaves $75,000 available.
• No stacking:
  • UM limits for several vehicles can't be added together (58-11-9.8).
  • UM and UIM limits can't be added together for one accident, unless separate uninsured and underinsured drivers are both liable (58-11-9.7).

Exclusions and restricted policies

• A policy may exclude a named person, but only by written agreement with the named insured (58-11-9.3).
  • If a restrictive endorsement still gives that person liability coverage, the coverage can't be less than the financial responsibility minimums.
• A physical-damage-only policy must say in 10-point bold type that it gives no liability coverage and doesn't satisfy any financial responsibility law (58-11-9.2).

Cancellation and nonrenewal (SDCL 58-11-45 to 58-11-53)

Scope. These rules don't apply to:

• policies insuring more than 4 autos
• assigned risk policies
• garage or repair operations

A policy written for less than 6 months is treated as a 6-month policy (58-11-45).

Cancellation

• First 60 days of a new policy: the insurer may cancel for any reason, if notice is given before the 60th day (58-11-47).
• After 60 days, the insurer may cancel only for (58-11-46):
  • nonpayment of premium
  • suspension or revocation of the driver's license or registration of the named insured or of a household or customary driver
  • noncompliance with the 24/7 sobriety program
• Notice must be mailed or delivered at least 20 days before cancellation (58-11-49).
• The insured may ask in writing for the reason. The insurer must give it within 5 days (58-11-50).
• Adding a deductible of $100 or less isn't a cancellation (58-11-48).

Nonrenewal

• The insurer needs at least 60 days' notice (58-11-51).
• Exceptions:
  • the insurer offered to renew
  • a transfer within the same insurer group with proper notice
  • nonpayment

Cancellation and nonrenewal notices must tell the insured about possible coverage through the assigned risk plan (58-11-53).

Assigned risk plan and rating

• The Director approves an automobile assigned risk plan for drivers who can't get coverage normally (58-11-57).
  • Every insurer authorized to write auto liability must participate.
  • Rulings of the plan can be appealed to the Director.
• An insurer that relies on an underwriting report must tell the applicant and producer who supplied it (58-11-45.3).
• An insurer may not raise rates because of a qualifying on-duty accident by a law enforcement officer, firefighter, EMT or emergency snow-removal operator driving an emergency vehicle (58-24-75).

Claims rules

• An insurer can't require repairs at a particular shop (58-33-67).
• Non-OEM (aftermarket) parts must be identified on the estimate, with a written disclosure in 10-point type (58-33-71).

Negligence rule

• South Dakota uses a slight/gross comparison (SDCL 20-9-2).
  • A plaintiff recovers only if their own negligence was slight compared with the defendant's.
  • Damages are then reduced in proportion.
• More than slight negligence bars recovery. Don't apply a 50% or 51% rule here.

Common exam traps

• Limits are 25/50/25.
• UM and UIM are both required at BI limits. They can't be stacked.
• After 60 days, auto cancellation reasons are limited to nonpayment, license or registration suspension or revocation, and 24/7 sobriety noncompliance. Cancellation needs 20 days' notice.
• Nonrenewal needs 60 days' notice.
• Proof of future responsibility goes to the Department of Public Safety and can be dropped after 3 years.