Apartment Building Insurance in South Dakota

Nate Jones, CPCU · Founder, Apartment Guard Insurance

Nate Jones, CPCU reads South Dakota habitational schedules against the valuation statute and the number of carriers on the risk — in the Sioux Falls metro, the Black Hills market at Rapid City, the eastern plains at Aberdeen and Watertown, and the campus stock at Brookings and Vermillion — through Wexford Insurance, LLC. Reach him through the Apartment Guard Insurance quote form or call 317-942-0549.

Last updated August 16, 2026 · Reviewed by Nate Jones, CPCU

How Many Policies Are on the Building

South Dakota has a valued policy law, and most of what is written about such statutes stops at the headline: on a total loss the amount you bought is the amount you are paid. SDCL 58-10-10 does say that. It applies where a policy is written or renewed to insure “any real property in this state, including structures on land owned by a person other than the insured,” against loss by “fire, tornado, or lightning,” and the property is “wholly destroyed.” Where it applies, “the amount of insurance written in the policy shall be taken conclusively to be the true value of the property insured and the true amount of loss and measure of damages.” Conclusively is doing the work in that sentence: the figure is settled when the policy is written, not reopened once the building is gone.

The part almost nobody reads is condition (5), and on a real apartment program it is the one that decides the file. “If two or more policies are written upon the same property interest, each insurer shall pay only that proportion of the cost of the loss that the limit of liability under its policy bears to the total amount of insurance covering the loss.” A single-carrier building is settled at the written amount. A building carried by two insurers is settled by arithmetic against the cost of the loss — which is the thing the valuation statute otherwise exists to stop anyone from arguing about.

That matters here more than it looks, because layering is not exotic on habitational property. Large schedules are routinely placed with a primary insurer and an excess insurer, or shared between carriers on a quota-share basis, and each of those is more than one policy on the same property interest. The structure of the program, not the wording of any one form, is what determines whether South Dakota’s valuation rule pays you the schedule or divides a loss figure. It is worth knowing which of those two you have bought before the storm rather than after it.

What the Statute Reaches, and the Ninety-Day Door

The reach is broad on the section’s own words and broader than most: the subject is “any real property in this state,” with no owner-occupancy condition and no unit ceiling, and the clause about “structures on land owned by a person other than the insured” means a building on ground the owner leases is inside rather than outside. The chapter-level provision points the same way. SDCL 58-10-1 provides that “Chapters 58-10 to 58-12, inclusive, apply as to all insurance contracts and annuity contracts,” excepting only reinsurance and policies not issued for delivery in the state. There is no personal-lines confinement anywhere above the section, which is exactly what several other states use to write this class out.

The statute then closes several doors on itself, and they are worth naming because each is a real building. Condition (1) applies the section only where a total fire loss occurs “ninety days or more” after the policy was made, or ninety days or more after limits were raised by “twenty-five percent” or more at the insured’s request — so a newly written or newly increased policy sits outside the rule during its opening window, and condition (2) exempts unchanged renewals and inflation-adjustment limits from that wait. Condition (3) settles builders’ risk on the actual value of the work completed. Condition (6) settles an appurtenant structure on the policy’s own terms unless a value was assigned to it before the loss.

And condition (7) removes “any claim for total loss to any building which is insured under a commercial blanket form with one amount covering two or more buildings.” Read the qualifier rather than the phrase: what is carved out is the blanket that puts one limit over several buildings, not the mere fact of a commercial form. A schedule that states a separate amount per building is not what condition (7) describes. The carve-out is also the clearest evidence in the section that the statute reaches commercial property at all — the legislature had no reason to exclude a commercial blanket form unless the rule otherwise caught commercial buildings.

What South Dakota Legislated, and What It Left to the Contract

The line 58-10-10 draws is unusually clean. What it takes over is total-loss valuation for three named perils and the arithmetic that applies when more than one insurer is on the risk. What it leaves alone is everything else on the file. The peril list is where that bites hardest: fire, tornado and lightning are named, and hail, derecho and straight-line wind are not. Those are the losses that actually recur across the plains and off the Black Hills, and because the section does not name them they are settled on the policy language, the valuation clause the carrier chose to write, and the percentage deductible.

So the schedule of values carries two different jobs at once in South Dakota, and they pull in opposite directions. On a tornado that levels a building, the declared amount is the settlement, which rewards a schedule kept current. On the far more frequent hail file, that same declared amount sets the retention you absorb before anything is paid. A number nobody has revisited since the building was bought is doing both of those jobs badly at the same time.

South Dakota Apartment Regulations & Licensing

Two regulatory bodies shape a South Dakota apartment program. Insurance carriers and the agents who place coverage are regulated by the South Dakota Division of Insurance, within the Department of Labor and Regulation, which oversees licensing, market conduct, and solvency for every company quoting your building.

On the leasing side the instrument and the body that enforces it are two separate questions, and South Dakota answers both inside one chapter. The instrument is the South Dakota Human Relations Act of 1972 — the name used by the Division of Human Rights, which administers it — codified at SDCL chapter 20-13. Its housing section, SDCL 20-13-20, makes it an unfair or discriminatory practice for an owner of rights to housing, or anyone acting for an owner, to “refuse to sell, rent, lease, assign, sublease, or otherwise transfer any real property or housing accommodation” because of “race, color, creed, religion, sex, ancestry, disability, familial status, or national origin,” and it reaches the terms and conditions of a tenancy and the advertising of it as separate practices. It also requires an owner to permit reasonable modifications for a disabled person at that person’s expense, subject to a restoration condition where reasonable.

Read the exemption in that section and you learn where an apartment building sits. Subdivisions (1), (2) and (4) “do not apply to rooms or units in dwellings that contain living quarters for no more than two families living independently of each other, if the owner maintains and occupies one of the living quarters as the owner’s residence.” The carve-out is written for the owner-occupied duplex, which means a five-or-more-unit building held as an investment is not carved out — it is squarely inside the section. The enforcing body is named in the chapter itself: SDCL 20-13-1(1) defines “Commission” as the South Dakota State Commission of Human Rights, and the Division of Human Rights within the Department of Labor and Regulation administers the complaint process. The federal Fair Housing Act covers the same ground independently, enforced by the U.S. Department of Housing and Urban Development. South Dakota does not appear on HUD’s list of funded state partner agencies, which is a statement about a funding relationship and not about whether the state body exists.

Because a standard liability form excludes most of those claims, we place tenant-discrimination liability alongside the rest of the program. Flood is its own placement, governed by the National Flood Insurance Program, which matters along the Big Sioux and Missouri river corridors.

Common Apartment Risks in South Dakota

South Dakota has no single dominant catastrophe peril, but it carries a steady mix of them. Tornadoes, derecho wind, and severe hail drive roof and exterior property claims across the plains and off the Black Hills. Extreme blizzard winters bring heavy snow-load and freeze-related burst pipes, a frequent driver of both property and business-income loss. River flooding along the Big Sioux at Sioux Falls and the Missouri corridor sits outside the standard property form. And in the older housing of the central-city cores, premises liability and negligent-security exposure weigh on the general liability line.

How a South Dakota Claim Settles, by Peril

Sort the recurring losses by which body of law answers them and the file becomes much easier to predict. A tornado that takes a building off its foundation is the one loss the legislature answered: named peril, wholly destroyed, and — on a single-carrier placement outside the opening ninety-day window — settled at the amount written on that schedule line. A fire is answered the same way. Lightning is the third named peril and rarely produces a total loss on masonry, but it belongs on the list.

Everything else is contract. A hailstorm off the Black Hills that strips roof covering across a community is a property claim outside 58-10-10, settled on the valuation clause and absorbed against a percentage deductible calculated from the same declared value. A derecho or straight-line wind event is in the same position — those words appear nowhere in 58-10-10. A blizzard that loads a flat roof past its capacity, or a supply line that bursts in an unheated stairwell and runs through three units, is a property and business-income loss decided entirely by the form. A boiler or rooftop unit that fails in January is equipment breakdown, which a basic fire-and-wind form excludes outright. A refused application is tenant-discrimination territory, sitting outside the general liability form entirely.

Why South Dakota Owners Want the Program Structure Read First

Two questions decide more South Dakota apartment files than any coverage form does, and both are answered before a loss rather than after one. How many insurers are on this building, and is the declared amount on each schedule line still true? The first decides whether 58-10-10 pays the written amount or apportions a loss figure among carriers. The second decides both what that written amount is worth on a total loss and how much you absorb on the hail claim that is far likelier to arrive.

That is the work: read the schedule, count the carriers, set the statute’s three named perils beside the ones your form actually covers, and take the building to market knowing which losses have a legislative answer and which have only a contractual one. We assemble property, general liability, business income, equipment breakdown, and tenant-discrimination coverage into one program built around the building. See the full apartment building insurance overview for how the program fits together.

Major South Dakota Apartment Markets

Related Reading

• Apartment building insurance overview
• Property, rental income & equipment breakdown
• General liability for apartment buildings
• Tenant-discrimination liability
• North Dakota apartment insurance · Minnesota · Iowa

South Dakota Apartment Insurance FAQs

Does South Dakota have a valued policy law, and does it reach an apartment building?

Yes, and on the section’s own words it reaches this class. SDCL 58-10-10 applies where a policy is written or renewed to insure “any real property in this state, including structures on land owned by a person other than the insured,” against loss by “fire, tornado, or lightning” and the property is “wholly destroyed.” Where it applies, “the amount of insurance written in the policy shall be taken conclusively to be the true value of the property insured and the true amount of loss and measure of damages.” There is no owner-occupancy condition and no unit ceiling. The chapter-level provision points the same way: SDCL 58-10-1 applies chapters 58-10 through 58-12 “as to all insurance contracts and annuity contracts,” excepting only reinsurance and policies not issued for delivery in the state.

What happens if two insurers cover the same South Dakota building?

The valuation rule stops working the way owners expect. Condition (5) of SDCL 58-10-10 provides that “if two or more policies are written upon the same property interest, each insurer shall pay only that proportion of the cost of the loss that the limit of liability under its policy bears to the total amount of insurance covering the loss.” On a single-carrier placement a total loss is settled at the amount written on the schedule. On a layered or quota-share program — ordinary on larger habitational schedules — it is instead divided in proportion against the cost of the loss. The structure of the program, not the wording of any one form, decides which of those you get.

Does the South Dakota valued policy law cover hail?

No. The peril list is “fire, tornado, or lightning,” and hail is not in it. Neither is derecho or straight-line wind. Those are among the losses that recur most often across the eastern plains and off the Black Hills, and each of them therefore falls outside 58-10-10 and is settled on the policy language, the valuation clause the carrier wrote, and the percentage deductible. A South Dakota apartment owner should expect the valued policy law to answer the rare catastrophic loss and the contract to answer the frequent one.

Is a commercially insured building excluded from the statute?

No, and the statute proves it by the carve-out it needed. Condition (7) removes “any claim for total loss to any building which is insured under a commercial blanket form with one amount covering two or more buildings.” Read the qualifier: what is excluded is a blanket placing one limit over several buildings, not a commercial form as such. A schedule stating a separate amount for each building is not what that condition describes — and the legislature would have had no reason to write the exclusion at all unless the section otherwise reached commercial property.

Is there a waiting period before the South Dakota valued policy law applies?

Yes, on new and newly increased policies. Condition (1) applies the section only where a total fire loss occurs “ninety days or more” after the policy was made or written, or ninety days or more after limits were increased by “twenty-five percent” or more at the insured’s request; inside that window the loss is paid under the policy’s own valuation terms. Condition (2) exempts unchanged renewals, policies with inflation-adjustment limits, and conversions to replacement cost under a written agreement. Builders’ risk is settled separately under condition (3) on the actual value of the work completed.

Who handles a housing-discrimination complaint in South Dakota?

The instrument is the South Dakota Human Relations Act of 1972 — the name the Division of Human Rights, which administers it, uses for it — codified at SDCL chapter 20-13, and its housing section is SDCL 20-13-20, which makes it an unfair or discriminatory practice to “refuse to sell, rent, lease, assign, sublease, or otherwise transfer any real property or housing accommodation” because of “race, color, creed, religion, sex, ancestry, disability, familial status, or national origin.” Its exemption is written for the owner-occupied building of no more than two families, so a five-or-more-unit investment building is inside the section rather than outside it. The enforcing body is named in the chapter: SDCL 20-13-1(1) defines the Commission as the South Dakota State Commission of Human Rights, and the Division of Human Rights within the Department of Labor and Regulation administers complaints. The federal Fair Housing Act covers the same ground independently, enforced by HUD.

How do I get a South Dakota apartment insurance quote?

Bring the schedule of values and the current program structure. In South Dakota those two documents decide the statutory outcome between them: the declared amount is the settlement on a total fire, tornado or lightning loss, and the number of insurers on the risk decides whether that amount is paid outright or apportioned. A CPCU-credentialed broker works through the schedule, counts the carriers on the placement, sets the statute’s three named perils beside the ones your form actually covers, and prices the building on that footing. One submission, one set of carriers, and a schedule you can defend at a total loss.