When it comes to automobile insurance, determining how much coverage you need may seem confusing. Your state likely has a minimum requirement for liability coverage, but this does not guarantee that amount is enough in case of an accident.

If you are a South Dakota driver, you may think $100,000 in liability coverage is ample, since South Dakota only requires $25,000 in liability coverage. However, that amount may not scratch the surface of actual costs if an accident occurs. Continue on to find out more about liability coverage, and how much you should have in case you cause an accident.

What is liability coverage?

South Dakota is a “fault” state when it comes to car accidents, so the person who is at fault for the accident is responsible for paying for any damage caused. Automobile liability insurance provides financial protection for you if you are responsible for a car accident, and it is part of the minimum automobile insurance requirements for drivers in South Dakota.

Liability insurance has two components: bodily injury and property damage. Coverage for bodily injury liability pays for medical expenses for any person you have injured, compensates that person for any lost income, and pays for funeral costs if the worst happens and the other person is fatally injured. Property damage liability coverage pays for any damage you cause to the other person’s vehicle, but will cover other property damage as well. If you drove into a building or other structure, for example, those costs would be covered under the property damage liability component of your policy. However, liability insurance does not cover any injuries that you suffer or any damage to your own vehicle.

Minimum requirements

The amount of liability insurance coverage that you have is often represented by three numbers, such as 25/50/25. In thousands of dollars, the numbers refer to how much your liability insurance policy will pay for injury to one person, how much the policy will pay for injuries to all persons combined per accident, and how much the policy will pay for property damage, respectively.

The numbers above reflect the minimum liability insurance requirements for South Dakota drivers, which are as follows:

  • $25,000 in bodily injury liability per person, per accident
  • $50,000 in bodily injury liability for all persons, per accident
  • $25,000 in property damage liability

Is minimum coverage sufficient?

While having minimum coverage provides some protection and makes sure you meet legal requirements, it is called a “minimum” for a reason. Medical bills add up quickly, especially if the injuries are serious or if more than one person is injured.  Since the at-fault party is responsible for all damages caused, if you are responsible for the accident and your insurance policy is not sufficient to cover all the damages, that means you are underinsured, and the injured party can take you to court for the difference between your policy amounts and the total amount of the damages. To protect yourself, you should have at least $250,000 worth of liability and UM/UIM coverage if you are a South Dakota driver to cover the realistic expenses of an accident. While premiums for car insurance can be expensive, if you have the bad luck to cause an accident, additional insurance can buy you a considerable amount of peace of mind in an already stressful situation.

Uninsured and Underinsured Motorist Coverage

In addition to liability insurance, South Dakota requires all drivers to have uninsured motorist (UM)/under insured motorist (UIM) coverage, which covers you if the at-fault driver has no insurance, does not have enough insurance, or if you are involved in a hit-and-run.  Typically, UM/UIM coverage mirrors the limits of your liability coverage. For instance, if you have 250/500/250 liability coverage (meaning that you have $250,000 of liability coverage per person, per accident) you will also have $250,000 per person, or $500,000 per accident of UM/UIM coverage if you’re injured by an at-fault driver without insurance or with only not enough insurance.

UM/UIM Insurance is inexpensive and it protects you from other drivers on the road who might only have the state minimums of insurance coverage.  If you suffer serious injuries at the hands of someone else, $25,000 does not go very far and is frequently completely exhausted by medical expenses alone.  Again, in order to protect yourself and your passengers you should have at least $250,000 worth of UM/UIM coverage.

Insurance claims

You pay your car insurance premiums with the expectation that, if you are involved in an accident, your insurance company will pay out in accordance with the terms of your policy. When the car insurance company does not respond to your inquiries about a claim, does not properly investigate your claim, or denies your claim, you may not know what to do next.

If your car insurance company is not communicating with you about your claim, it does not necessarily mean that something is amiss: the investigation may not be completed, or the company may be waiting for more information. However, car insurance companies are legally required to act in good faith, which means that they must honor the terms of a policyholder’s policy. If your insurance company has denied a claim for benefits that are covered by your policy, you should contact a car accident attorney for further assistance with receiving the benefits that you are owed.

Get help

If you have been involved in a car accident and do not know what to do next, the helpful and knowledgeable team at Turbak Law can help. Contact us today for a free consultation, or call 866-231-0914 to get the guidance you need. Our car accident attorneys can help you understand your options and take action.