In South Dakota, business owners can expect to pay, on average, $1.16 for every $100 of covered payroll. That means, for example, a business with a total annual payroll of $100,000 will pay approximately $1,160 per year for workers’ compensation insurance, or around $96 a month. This is only a rough estimate, since factors such as your location, the different rates for staffing types (laborers vs office workers), and your claims history can all have a significant impact on your rates.
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What’s Covered
South Dakota’s Workers’ Compensation Death Benefits
South Dakota’s Workers’ Compensation Laws
How to Buy Workers’ Compensation Insurance
How to Get the Most Savings
FAQs
Why Use EZ
One of the biggest factors in determining your rates for workers’ compensation insurance is your employees’ risk, or the likelihood of a workplace injury occurring at your business. To assist insurers in determining risk exposure, and to get the best rates for your business, you can use a variety of workers’ compensation class codes. This is important because it costs more to insure certain employees. For example, office employees may have lower workers’ compensation costs than those who work outside of your office and face more risks.
What’s Covered
If one of your employees is injured at work or becomes ill because of workplace conditions. Workers’ compensation in South Dakota can help pay for their medical bills. The weekly average wage of an employee is used to calculate workers’ compensation benefits. The type of claim determines the exact amount.
The most important thing that workers’ compensation does is offer coverage for your injured employee’s medical treatment. This would include doctor’s appointments, hospital stays, and surgical procedures. Following a return to work, an employee may need ongoing care. Such as follow-up appointments or extra surgeries; workers’ compensation will also cover these medical bills.
Additionally, if the incident causes permanent or temporary disability, the employee will receive compensation in the form of weekly or lump sum payments. If your employee suffers a temporary disability, their injury is preventing them from performing their regular job while they recover. They have a permanent disability if a doctor determines that they will not fully recover from their injury.
These two classifications fall into two subcategories:
- Temporary total disability (TTD) – These payments will be made if your employee is unable to work at all during their recovery.
- Temporary partial disability (TPD) – TPD payments will be made if your employee is still able to work, but with certain restrictions, such as requiring lighter duties or fewer hours. Even if your company does not provide work that meets these requirements, the employee may still be eligible for these payments.
- Permanent total disability (PTD) – If the accident or illness leaves your employee unable to work at all, even after recovery, they will be eligible for PTD payments.
- Permanent partial disability (PPD) – If an employee has permanent impairments but is able to work with those impairments, they will be eligible for PPD.
South Dakota’s Workers’ Compensation Death Benefits
South Dakota state law requires the payment of death benefits to the survivors of an employee who dies as a result of a work-related injury or illness. These benefits take the form of payments to replace the worker’s lost income, as well as payments for burial-related expenses.
The employee’s spouse will be entitled to 67% of the employee’s average weekly wage (overtime included at the straight rate). When the spouse remarries, payments will stop, but your insurer will pay them a lump sum equal to two years of the deceased worker’s salary.
If the employee had eligible surviving children, their income benefits will stop two years after the surviving spouse remarries.
If children are the only survivors, they will receive income payments equal to 67% of the deceased employee’s average weekly wage until they reach the age of 18 (or 22 if enrolled full-time in school). Children who are physically or mentally unable to support themselves will be paid for the rest of their lives.
Your insurer will pay an additional $50 per month to each legally dependent child of the deceased employee from the date of the employee’s death until the child reaches the age of 18. In addition, your insurer will have to pay an extra $2,000 per year for up to five years for each child enrolled full-time at an accredited post-secondary educational institution.
Survivors will also receive up to $10,000 in burial expenses in addition to survivor income benefits.
South Dakota’s Workers’ Compensation Laws
South Dakota employers, unlike those in most other states, are not required by law to carry workers’ compensation insurance. The state, though, encourages employers to have workers’ compensation coverage in order to avoid civil lawsuits.
If you choose to purchase workers’ compensation coverage, you will gain legal protection against claims that your negligence resulted in an employee injury.
If you’re self-employed or independent contractor, you may want to purchase this coverage to fulfill the terms of a contract, or for financial protection against medical expenses. Even if you have health insurance, your plan might not fully cover work-related injuries. Not only that, but your health insurance will never cover lost wages, as workers’ comp often does.
How to Buy Workers’ Compensation Insurance
In South Dakota, you can buy a workers’ compensation insurance policy from a private insurance carrier that is licensed by the state to offer workers’ compensation insurance.
If your business’s high-risk status prevents it from obtaining workers’ compensation coverage from private insurers, you can obtain coverage from the South Dakota assigned risk market. The National Council on Compensation Insurance (NCCI) manages this insurance pool, which serves as the state’s last-resort workers’ compensation carrier.
If you meet certain criteria, you may be able to self-insure your workers’ compensation claims. This means you will pay any workers’ compensation claims out-of-pocket as they arise, instead of paying a premium and submitting claims to an insurance company. To be eligible to do this, you must file an application with the South Dakota Department of Labor and Regulation.
If you need help finding a policy, Ez’s agents can help sort through all of your options, and find you the best workers’ comp insurance for your business.
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How to Get the Most Savings
The majority of the cost of workers’ compensation comes from factors beyond your control. However, there are still ways to save. Implementing a safety program is a great way to reduce workplace injuries and claims, which will lower your premiums. So regardless of your industry, it is important to have safety and standard operating procedures in place. Employees who have safety training are less vulnerable to injuries, lowering your workers’ compensation costs.
It is also a good idea to regularly review your claims history. Evaluating your claims history on a regular basis can help you identify and correct patterns. You might discover that certain aspects of your business operations are frequently causing claims. This allows you to adjust the operation to make it safer. You can save money by keeping an eye on potentially dangerous operations.
Correctly classifying your employees is one of the most effective ways to save money. When you apply for your workers’ compensation policy, you will classify each of your employees depending on their job’s risk. And this risk classification influences the cost of your workers’ compensation. For example, you might pay less to insure an office worker than you would a manual laborer. It’s also important to correctly classify your employees because you may receive a fine if you fail to do so.
Begin a free online application today to compare workers’ compensation insurance quotes for your small business from leading U.S. insurers. EZ’s agents specialize in insurance for a wide range of small businesses. Working with our agents can save you hundreds of dollars a year on coverage.
South Dakota Workers’ Compensation FAQs
Are you required to have workers’ compensation insurance in South Dakota?
No, South Dakota is one of the only states that does not legally require workers’ compensation insurance. But if you don’t have coverage, and an employee gets injured, you could be vulnerable to expensive lawsuits.
How do workers’ compensation settlements work in South Dakota?
Many workers’ compensation claims in South Dakota result in settlements. This means that the claim’s parties – you, your injured employee, and your insurer – must agree on a lump-sum payment in exchange for the employee (or the employee’s survivors) agreeing to waive future payments.
All workers’ compensation settlements must be approved by the South Dakota Department of Labor and Regulation. Both your workers’ compensation insurer and the employee must submit settlement paperwork to the department. The settlement will be considered approved if the department does not respond within 20 days with an official disapproval notice. When a settlement application is approved in South Dakota, it is final.
What is the statute of limitations in South Dakota?
Employees in South Dakota must file a workers’ compensation claim within one year of the date of the accident. If your business provided medical treatment for the injury, or if the employee was able to continue working, the deadline can be extended.
Why Use EZ
We do everything in our power to make shopping for workers’ compensation insurance as easy and stress-free as possible. And we give each of our customers our undivided attention. As soon as you fill out our form, you will receive instant, free quotes from your dedicated agent. Who will give you personalized service and will work to understand your needs. We want to ensure that you get the best coverage at the best price. Our services are completely free so check out your quotes today!
If you still have questions, feel free to give us a call at 877-670-3538. You will speak to a local insurance agent who can answer all of your questions. And help you find the workers’ compensation policy that works best for your business.
