The A-Z guide to South Dakota Workers' Comp

South Dakota Workers’ Compensation Insurance

Name: Workers' Compensation Insurance for South Dakota
Brand: Kickstand Insurance
Rating: 5 (37 reviews)

Unlike in most states, employers are not required to offer South Dakota workers’ compensation insurance to their employees. However, the state highly recommends that employers offer this coverage to their employees in case of work-related injuries and illnesses and to protect themselves from civil suits.

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South Dakota is one of the only states that does not require employers to have workers’ comp coverage.

Workers’ comp laws do not apply to:

farm or agricultural workers
some domestic employees

Is workers’ comp insurance required in South Dakota?

The law does not require businesses in South Dakota to carry workers’ compensation insurance for their employees. However, employers are encouraged to have workers’ compensation insurance to avoid legal repercussions and civil suits filed by injured workers. Benefits for employers who have workers’ comp insurance include medical, disability, lost wages, and death benefits for their employees.

Do you need workers’ compensation coverage if you’re self-employed?

Like all South Dakota employers, self-employed workers aren’t required to have workers’ compensation insurance but can get their own coverage with an insurance company.

For independent contractors, some employers will ask that you have workers’ compensation before beginning a contract. Other employers with workers’ compensation coverage will cover self-employed contractors until the contract is fulfilled.

Who is exempt from South Dakota workers’ comp requirements?

South Dakota workers’ compensation laws do not apply to certain job categories such as farm or agricultural workers, and domestic jobs, like babysitters and housekeepers, if employees work less than 20 hours for more than six weeks in 13 weeks.

How much is workers’ comp coverage in South Dakota?

Your specific South Dakota workers’ comp rate will depend on the following factors:

The type of business you have
The size of your payroll
Your safety record
Claim history

How can South Dakota small business owners save money on workers' comp?

Workers’ compensation coverage is optional but not mandatory for small business owners in South Dakota.

If you decide to get coverage for your employees, here are a few ways small businesses can save money on South Dakota workers’ comp insurance.

Workplace Safety Programs. Insurance companies may be willing to give you a credit for having a formal safety program. This program would educate your employees about how to stay safe in the workplace with pamphlets, presentations, and other resources about current safety protocols.
Drug and Alcohol free Workplace Policy.If you have an official policy that drugs and alcohol is not allowed in the workplace, many insurance companies will reduce your premium a bit. This is because it statistically lowers your chance of having an injury.
Check your class codes. It might sound basic but many businesses are paying inflated rates when they don’t have to. Tell your insurance agent everything that your employees do and ask him if they are classified correctly.
Separate your clerical employees from the main class code. In many businesses, clerical employees can be classified with a separate code and pay a much cheaper rate.

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How does workers’ comp work in SD?

If you decide you want an insurance policy, the first step would be to reach out to an agent and start getting quotes from different companies. These quotes will be based on your estimated annual payroll, amount of money you think you will pay your employees in the next 12 months.

You should compare the quotes and pick the one that's right for your business. You should ask about your options for different payment plans. After you sign the papers and pay the first payment you will have coverage for the next 12 months.

At some point during the life of the policy or at the end of the 12 months, the insurance company will conduct an audit to compare the estimated payroll to your actual payroll figures and either issue a bill or credit for the difference.

If at any point one of your employees gets injured on the job, you need to file a first report of injury with the insurance company and the South Dakota Division of Labor and Management.

The insurance company will take care of paying the medical bills and lost wages until the injured worker is able to go back to work.

What does workers’ comp cover in South Dakota?

Workers who file a workers' comp claim in South Dakota can receive benefits for the following:

Medical bills

Lost Wages

Death Benefits

Workers' comp coverage also protects employers from legal action. This means that if an employee sues your business because of a workplace injury, the insurance will cover the legal costs of the case.

How to get workers’ comp insurance in South Dakota?

Workers comp insurance policies can be purchased through a licensed agent or on an online platform. Many companies will benefit from the advice of an experienced agent who can guide them on common pitfalls and ways to save money for their industry.

What can happen if I don’t have workers’ comp insurance in South Dakota?

South Dakota workers’ compensation law doesn’t require employers to have workers’ comp coverage, so there are no legal consequences from the state.

However, employers can be liable for injured workers’ compensation if a worker chooses to sue a business in civil court. This would make an employer responsible for medical expenses and replacement wages.

Not having workers’ compensation insurance in South Dakota could damage a business’s reputation. Workers want to feel safe and valued, so an employer without coverage is considered a red flag, making it harder to attract and retain employees.

FAQS

What are workers’ comp death benefits in SD?

Workers’ compensation insurance death benefits in South Dakota are as follows:

Up to $10,000 in funeral and burial expenses, including the cost of transportation if a worker dies outside of their community.
Spouse benefits equal to 66% of the deceased employee’s weekly wages, including overtime. If the spouse remarries, they receive a lump sum comparable to two years of weekly compensation.
Children’s benefits equal 66% of the deceased employee’s weekly wages until the child (or children) turn 18. The cutoff age is 22 if the child is a full-time student. However, if a child is mentally or physically disabled, benefits continue for life.
Additional children’s benefits include $50 monthly for each child until they turn 18. Dependents enrolled as full-time college students in South Dakota will receive $2,000 for up to five years.

How do workers’ comp settlements work in SD?

Under South Dakota workers’ compensation insurance laws, settlements are agreements between an employer and an employee. Terms are negotiated to cover medical expenses and lost wages, and settlements are doled in lump sum or structured payments.

What are the statutes of limitations regarding workers’ comp in SD?

The statute of limitations for workers’ compensation insurance in South Dakota is one year from the date of an injury or medically discovered illness. However, the deadline may be extended for employees capable of continuing work.

How do I get a workers’ comp insurance policy with Kickstand Insurance?

Start by filling out a short online form about your business. We’ll use that info to get you an estimated quote. Then, one of our experienced agents will contact you to review the quote and make sure you are getting the absolutely lowest rate possible for your business. Once the quote is finalized, you’re ready to buy the policy - often with coverage starting that day!

Ready: Fill out an online form. It only takes 5 minutes!
Set: One of our agents will contact you to review the quote.
Go: You can get covered starting today!

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Learn more about Workers' Comp in South Dakota

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Why does it matter?

Avoid surprise bills at audit
Make sure all your employees are properly covered
Protect yourself from lawsuits

What do we check?

Business categorized correctly
Employees job roles
Special discount opportunities