South Dakota

Buying workers’ compensation for:

South Dakota

State Fund: No

Insurance Coverage Requirements: Workers’ Compensation is compulsory in South Dakota, some waivers are permitted.

Who is Required to Purchase Workers’ Compensation Coverage?

The South Dakota Workers’ Compensation Law permits all employers to provide coverage rather than assume direct liability for workplace injuries. The following employees are exempt from the Law:

  1. Domestic servants, unless working for an employer for more than 20 hours in any calendar week and for more than six weeks in any 13-week period;
  2. Farm or agricultural laborers;
  3. One whose employment is not in the usual course of the trade, business, occupation, or profession of the employer (independent contractor). This includes real estate brokers and owner-operators of trucks who are certified as exempt by the department.
  4. Certain elected officials of the state or any subdivision of state government; and
  5. Workfare participants.

Factors that Impact Coverage

  • You are a sole proprietor or partner: In South Dakota, you are excluded from coverage but have the option to include yourself.
  • You are a corporate officer or member of an LLC: South Dakota includes you in coverage, but you have the option to exclude yourself.

Failure to Secure Compensation

If an employer fails to provide workers’ compensation coverage under the provisions of the South Dakota Workers’ Compensation Law, an injured employee or the dependents of a deceased employee may proceed against the employer in an action at law to recover damages for the personal injury or death or may elect to proceed against the employer in circuit court under the provisions of the Workers’ Compensation Law as if the employer elected to operate thereunder. The measure of benefits for the employee shall be all medical expenses plus twice the amount of disability or death compensation allowed under the Workers’ Compensation Law.

Proof of Coverage is Required

Employers must display informational postings promoting safety in the workplace in visible locations throughout the business premises. There is no required format for this poster.

Independent Contractors

Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties.

View 20 factors used by the IRS and our independent contractor questionnaire to determine whether you have enough control over a worker to be an employer.

Key Resources

Other Tips

If your insured employs workers in multiple states or your insured’s employees are temporarily working out-of-state, they need to purchase insurance for all the states where their workers are located, according to each state’s laws. Call 1-800-476-2948 and let us walk you through it.

The nature of your insured’s business, number of employees being covered and past coverage and claims are all factors in how much their premium will cost.