Disclaimer: This article is for informational purposes only and does not constitute legal advice.
Detailed Answer
After a collision, insurers in South Dakota must handle your auto claim fairly and promptly under state law. Two key statutes protect policyholders:
- SDCL § 58-12-2 (Prompt Payment of Insurance Claims Act)
- SDCL § 58-33-1 et seq. (Unfair Claim Settlement Practices Act)
If your insurer delays or denies a valid claim, follow these steps:
1. Review Your Policy and Gather Evidence
Compare the insurer’s explanation to your policy terms. Collect repair estimates, medical bills, photos, police reports and written communications.
2. Send a Written Demand Letter
Draft a clear demand letter summarizing facts, policy provisions and applicable law (citing SDCL § 58-12-2). Request payment or a detailed explanation within 15 business days.
3. File a Complaint with the South Dakota Division of Insurance
If the insurer fails to respond, file an unfair practice complaint online at the South Dakota Department of Labor & Regulation, Division of Insurance (dlr.sd.gov/insurance).
4. Consider Appraisal or Small Claims Court
Many auto policies include an appraisal clause to resolve value disputes. If your loss is under $12,000, you may file in small claims court under SDCL § 16-16A-2. For larger claims, file suit in civil court.
5. Consult a Qualified Attorney
If you face complex delays or significant denial, seek legal representation. An attorney can advise on bad‐faith claims and potential punitive damages under state law.
Helpful Hints
- Document all communications in writing and retain copies.
- Track response deadlines set by SDCL § 58-12-2 to identify bad faith.
- Use certified mail for demand letters to create a record.
- Keep a detailed log of phone calls, dates, times and names.
- Explore free mediation services before filing a lawsuit.