South Dakota residents looking to purchase life insurance should educate themselves on the life insurance situation in the state. South Dakota, like the rest of the country, has its life insurance industry regulated on the state level. This means that life insurance standards in South Dakota will be different than those in any other state, including neighbors North Dakota and Nebraska.
South Dakota Life Insurance Rules And Regulations
The life insurance industry in South Dakota is regulated by Title 58 of the South Dakota Codified Laws. This set of laws, written to protect consumers and businesses, sets rules for claims procedures and policy requirements. We assume that you do not want to open the Codified Laws document and study the South Dakota law-book yourself, so we have highlighted the key parts of it below:
Free Look Period In SD
All life insurance policies in South Dakota must carry a 10 day “free look period.” Free look periods allow new policyholders to test out and review their new policies and then return them for a full refund if they desire. In South Dakota, this is set to 10 days, but life insurance companies in the state might have longer periods set, based on their company policy.
Timely Payment Of Claims In SD
After filing a life insurance claim in South Dakota, your insurer will be given 2 months to make payment on said claim. This law was established in hopes to protect the consumer in case their insurance company decides to withhold benefit payment. If the insurer is late in paying out on a claim, they will be penalized and the account of the beneficiary may accrue interest.
Personal Information Protection In SD
Your privacy is protected by law in South Dakota. Life insurance companies are not allowed to share your medical records with any other agency or institution. Your insurer is obligated to honor your request for personal information, but is not permitted to share it with anybody else. It is best to check with your insurance company to learn more about their company policy regarding policyholder privacy.
For more information regarding South Dakota life insurance laws, please contact:
South Dakota Division of Insurance
South Dakota State Guaranty
In the event your life insurance company becomes insolvent in the state of South Dakota, your policy will be backed by South Dakota Life and Health Insurance Guaranty Association. This organization will protect your life insurance policy for up to $300,000 in lost death benefits as long as you remained up to date on your premium payments and your insurer was licensed to do business in the state.
This benefit is the maximum payment guaranteed for a single life. If the deceased had more than one life insurance policy in their name, they are still only protected for up to $300,000.
For more information on the South Dakota Life and Health Insurance Guaranty Association, please contact them at:
206 W. 14th Street
Sioux Falls, SD 57104