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Did you know that South Dakota is often referred to as "the land of infinite variety"? This state offers the complete package – iconic tourism attractions, rich history and culture, exciting festivals, important monuments, and more.

If you plan to move to this state or invest in the local real estate market to start your rental business, you'll also have plenty of opportunities.

However, South Dakota experiences several events that can put your investment at risk. From heavy snowfall and winter storms to wildfires and floods, many natural disasters strike this state throughout the year.

Is there an efficient way to protect your property against these hazards?

With a comprehensive homeowners insurance policy, you'll have a safety net to cover loss and damage expenses if the unexpected occurs.

Are you interested in this type of insurance? If you research the market, you'll find many options. However, it's important to choose the best one to make sure your property is well-protected.

Fortunately, you've come to the right place! We've collected all the information you need to choose a reliable South Dakota home insurance company. Read on!

Understanding Homeowners Insurance in South Dakota

Homeowners insurance covers loss and damage to properties or belongings, providing financial protection in the event of an accident or disaster.

This type of insurance is essential to protect your investment from common hazards, such as theft, fire, extreme weather, and more.

A comprehensive homeowners insurance policy will serve as your first line of defense against the risks all property owners face. Also, it gives you peace of mind in times of uncertainty.

Average Home Insurance Costs in South Dakota

Do you want to know how much you should pay for homeowners insurance in South Dakota? Here's what the latest figures show!

According to this year's rate data from Quadrant Information Services, the average cost of homeowners insurance in this state is $2,105 for $250,000 in dwelling coverage.

Compared to the national average cost, which was estimated at $1,428 for the same amount of coverage, home insurance premiums in South Dakota are 47% higher.

The average annual cost of homeowners insurance in South Dakota is also higher than in neighboring states. In North Dakota, property owners pay around $1,900 for this coverage per year. Premiums in Minnesota average $1,930 annually.

Several factors influence South Dakota homeowners insurance rates, such as the average costs of labor and materials. Other aspects that may impact premiums may include the following:

  • The location of the property
  • The condition and age of the property
  • The volume of property damage claims in the area
  • The likelihood of natural disasters
  • Property value
  • Construction costs and requirements
  • Security features
  • Coverage limits
  • Mandatory coverages

In addition, each company can set different costs and offer discounts to reduce premiums.

However, you should choose a policy based on multiple factors. If you only focus on prices, you might pick an option that doesn't suit your needs or fails to offer comprehensive protection to your property.

Homeowners Insurance vs. Landlord Insurance

Before choosing a policy, you should also understand the difference between homeowner and landlord insurance. Let's go over both definitions.

What does homeowners insurance cover?

A home insurance policy covers potential damages and losses related to the structure of the property and your belongings.

What does landlord insurance cover?

On the other hand, landlord insurance covers both damage to the structure and the owner's belongings but includes other coverages related to the rental business.

A landlord-specific policy often includes liability protection, covering both guests and tenants. Additionally, this type of insurance addresses potential loss of rental income if caused by a covered event.

However, a landlord could purchase a homeowners insurance policy in the following scenarios:

  • Vacancy: If the property is vacant, and you don't plan to rent it out, you can get protection for your home and belongings with a homeowners policy.
  • Temporary Absence: A homeowners insurance policy might also be the best option if a tenant will live in your property for a short period.
  • Transition Period: Do you want to live in your property while screening candidates to find the right tenant? During this period, a homeowners insurance policy may be ideal.
  • Home Sharing: If you don't rent out your property as a whole but only a portion of it, you can also consider purchasing homeowners insurance. However, you'll need home-sharing and liability coverage.

How to Choose a South Dakota Homeowners Insurance Company

Do you think a homeowners insurance policy is the best option to protect your property? Here's what you should consider to pick the right company.

Unique Policy Needs for South Dakota Homeowners Insurance

Every state experiences several natural events. In South Dakota, common hazards include tornadoes, wildfires, heavy snowfall, winter storms, heat waves, and floods.

To choose a comprehensive homeowners insurance policy, you should consider these events. In this regard, these are the coverage options it should include:

Flood Coverage

Although flooding is common in South Dakota, most standard policies don't include this type of coverage. Instead, homeowners purchase flood insurance as an add-on.

Hurricane Coverage

Although South Dakota doesn't experience frequent hurricanes, this policy may be necessary to cover damage from strong winds, including tornadoes.

Evaluate the options your company offers to choose the right one. In this state, you should purchase an insurance policy with protection against winter storms and wind or hail damage.

Evacuation and Additional Living Expenses (ALE) Coverage

Natural disasters and accidents often cause extensive damage to properties, making them uninhabitable. When this occurs, homeowners seek temporary housing, which may result in unexpected, high expenses.

However, you can purchase a policy with evacuation and additional living expenses coverage. This will pay for covered costs if you need to move to a temporary location.

Other Factors to Consider When Assessing South Dakota Home Insurance Companies

Did you define the state-specific coverage options you should include in your policy? Now, it's time to choose the best homeowners insurance company. Here are a few tips to help you make an informed decision:

  • List your needs according to your property's features and condition, your area's hazards, and your budget
  • Research multiple homeowners insurance companies and evaluate what each offers
  • Compare different coverage options, considering what they include and exclude or available add-ons
  • Request quotes and compare costs to choose a company offering value for money
  • Assess whether the insurer can meet claims obligations by reviewing AM Best's financial strength ratings
  • Ask about potential discounts to save on your premiums
  • Contact your loved ones or colleagues and ask for recommendations to choose a reliable company
  • Evaluate the insurer's customer service and reputation by checking online reviews from previous customers
  • Review each policy in detail, considering coverage options and limits, deductibles, rules, and more

Best Home Insurance Company in South Dakota

Do you already know the essentials to pick the right insurance company and purchase an adequate policy?

Now, we'll take a closer look at the best options you can find in South Dakota, considering their offerings, premiums, discounts, benefits, and more.

1) USAA

USAA

This San Antonio-based home insurance company was founded in 1922. However, almost 100 years later, it's still one of the top choices for US homeowners. This insurer offers comprehensive policies with excellent coverage options and add-ons. Plus, it has been rated A++ for financial strength by AM Best.

However, USAA doesn't offer home insurance policies to all US residents. The company's coverage options are available to former and current military members and their families.

Coverage and Features

Although not all US citizens are eligible, those who can purchase standard USAA policies will get the following coverages:

  • Dwelling coverage
  • Personal property coverage
  • Additional living expense (ALE) coverage
  • Personal liability coverage
  • Replacement cost coverage
  • Identity theft protection
  • Lost military uniform coverage
  • Other structures protection

If you choose USAA as your home insurance company and want to customize your policy, you can choose between the following options:

  • Earthquake coverage
  • Home-sharing coverage

USAA doesn't have many additional coverages. Also, its policies are limited in terms of eligibility. However, its standard options include multiple coverages and offer many benefits to active-duty military members.

Discounts

This company also offers discounts to help eligible policyholders save on their annual premiums. These are:

  • Discount of up to 10% on home insurance for people who also purchase auto insurance
  • Protective device credit discount for people who installed security systems in their properties
  • Claims-free discount for policyholders who haven't filed a claim in the last five years

2) Amica

Amica

Amica is another home insurance company with a solid reputation and excellent offerings. It has been in business for over 115 years. In addition, it has a wide variety of policies with multiple coverage options to provide full protection to South Dakota residents.

Although not available in all states, Amica offers dividend-paying policies. If you choose this option, you'll receive a percentage of your premiums back. This will help you save on your premiums.

Coverage and Features

Amica has two policy options for South Dakota homeowners. Let's take a look at what each includes:

Standard Choice Home Coverage

  • Dwelling and attached structures coverage (repairs or reconstruction)
  • Additional living expense (ALE) or loss of use for temporary housing
  • Personal property coverage for clothes, furniture, and other items
  • Liability coverage for medical and legal expenses if someone is injured on your property

Platinum Choice Home Coverage

Amica's Platinum Choice includes all coverages in the standard plan and the following additions:

  • Dwelling replacement cost coverage
  • Personal property replacement coverage
  • Liability and medical payment coverage
  • High-value items coverage
  • Water backup or sump overflow coverage
  • Special computer coverage
  • Credit card coverage
  • Loss assessment plan coverage (condos and gated communities)

Discounts

Besides dividend-paying policies, Amica offers the following discounts to help policyholders save on their annual home insurance costs:

  • Discounts for homeowners who haven't filed a claim in the last three years
  • Discounts for properties with alarm systems
  • Discounts for bundling homeowners insurance with other policies
  • Discounts for homeowners who sign up for electronic documents
  • Discounts for those who have been with the company for at least two years
  • Discounts for properties with automatic detection devices
  • Discounts for new or newly remodeled homes

3) American Family

American Family

After its founding in 1927, this Wisconsin-based home insurance company became an industry leader. This insurer offers coverage options for different types of properties, such as condos, apartments, single-family residences, and manufactured homes.

In addition, American Family offers insurance to protect unoccupied or vacant houses, personal belongings, and home-based businesses.

This company is also committed to helping customers save on their premiums. Policyholders may be eligible for multiple discounts to reduce their annual home insurance costs.

Coverage and Features

An American Family standard home insurance policy includes the following:

  • Dwelling and attachments coverage
  • Protection to other structures if they're damaged by a covered event
  • Damaged or destroyed personal belongings coverage
  • Personal liability coverage
  • Coverage for temporary living expenses

Also, the company has additional coverage for homeowners seeking enhanced protection for their properties. These are:

  • Sump pump and water backup
  • Credit theft protection
  • Equipment breakdown
  • Matching siding protection
  • Hidden water damage
  • Diminishing deductible

Discounts

As mentioned, American Family offers several discounts. These are:

  • Discount for bundling policies (up to 23%)
  • Discount for newer and renovated homes
  • Discount for customers who have been with American Family for more than one year
  • Discount for smart payments for policyholders who pay their premiums in full or through automatic systems
  • Generational discount for people aged 18-30 if their parents have an active auto or home insurance policy from the same company
  • Discount for safe, secure, and smart home if the property is equipped with security systems or other qualifying devices

4) State Farm

State Farm

State Farm has earned the highest financial stability rating from AM Best, which means it's able to meet claims obligations. This is essential after an accident or disaster, as you'll need a prompt response to repair or replace damaged or destroyed structures and items.

In addition, this company has excellent policies with multiple coverage options to expand and customize them, including flood coverage under the National Flood Insurance Program (NFIP).

Although this company doesn't offer as many discounts as the main competitors, its prices are affordable. State Farm can be a great option if you're on a tight budget.

Coverage and Features

These are the coverage options a State Farm standard home insurance policy includes:

  • Coverage to repair or replace dwelling and attached structures
  • Protection of other structures that aren't permanently attached to the dwelling
  • Additional living expenses (ALE) or loss of use if the property must be evacuated
  • Coverage for belongings
  • Medical payment coverage for guests and non-household members
  • Personal liability coverage

If you want to customize your State Farm home insurance policy, you can also consider the following add-ons:

  • Ordinance or law insurance to repair or rebuild a property according to today's building codes
  • Increase in the dwelling coverage if construction costs rise
  • Coverage for valuable possessions, including jewelry and fine arts
  • Reimbursement in expenses for restoration and case management if you're a victim of cybercrime or fraud
  • Reimbursement and case management services for identity theft

Discounts

State Farm offers a few discounts for policyholders hoping to save on their premiums. These are:

  • Discounts for homeowners who haven't filed a claim in several years
  • Discounts after updating utilities
  • Discounts for bundling home and auto insurance policies
  • Discounts for properties with home monitoring systems
  • Discounts after installing impact-resistant roofs
  • Discounts for properties with automatic indoor fire sprinklers

5) Allstate

Allstate

Last but not least, there's Allstate. It's another excellent home insurance company with comprehensive options for South Dakota homeowners. However, this insurer offers unique benefits and coverages.

Allstate has a plan that allows homeowners to make their properties more eco-friendly. The Green Improvement Reimbursement covers the costs you may incur by replacing lost or damaged items with energy-efficient alternatives.

Also, this company has earned an A+ rating for financial stability by AM Best, which means you'll likely get a prompt response after filing a claim.

Coverage and Features

If you purchase a standard Allstate home insurance policy, you'll get the following:

  • Dwelling and attached structures coverage
  • Personal property coverage
  • Liability protection coverage
  • Guest medical protection

Additionally, Allstate offers many coverage options for those who want to add an extra layer of protection to their existing policies. These are:

  • Flood insurance
  • Personal umbrella policy
  • HostAdvantage for home-sharing insurance
  • Water backup
  • Identity theft restoration, covering lost wages, legal fees, and other related costs
  • Home-based business coverage
  • Yard and garden coverage
  • Sports equipment coverage
  • Scheduled personal property coverage
  • Musical instruments coverage
  • Green improvement reimbursement
  • Electronic data recovery coverage

Discounts

If you want to save on your home insurance premiums, you have to be eligible for at least one of the following Allstate discounts:

  • Discount for bundling services
  • Discount for new homebuyers
  • Discount to customers with a history of good payment practices
  • Welcome and loyalty discount
  • Discounts for policyholders who sign up for a new policy before the existing one expires
  • Discounts for automatic payments
  • Discounts for homeowners who haven't filed a claim recently

Other Notable South Dakota Home Insurance Companies

Are you still looking for the right South Dakota home insurance company? We've listed the best options based on our criteria. However, other insurers offer excellent policies and benefits. These are some of them:

  • Nationwide
  • Travelers
  • Chubb
  • Liberty Mutual
  • Farmers Insurance
  • Progressive

Conclusion

No one wants to lose the money they worked so hard to earn. That's why homeowners should find the best option to insure their properties against unforeseen events.

As explained above, South Dakota is vulnerable to several natural disasters that can damage your property and belongings. In the worst-case scenario, a loved one, visitor, or tenant may be injured in your home.

However, a comprehensive home insurance policy provides the financial protection you need in these cases and the peace of mind you always deserve.

Consider your needs, compare different options, and carefully evaluate multiple policies. Then, use that information to choose the best homeowners insurance company to keep your property safe.

David is the co-founder & CMO of DoorLoop, a best-selling author, legal CLE speaker, and real estate investor. When he's not hanging with his three children, he's writing articles here!

Legal Disclaimer

The information on this website is from public sources, for informational purposes only and not intended for legal or accounting advice. DoorLoop does not guarantee its accuracy and is not liable for any damages or inaccuracies.

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