South Dakota homeowners insurance
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Useful tools for finding South Dakota homeowners insurance
For a number of South Dakota homeowners, the search for the best home insurance policy can seem like a confusing or even overwhelming process. However, all you really need to sort through competing options is information about the insurance landscape in South Dakota, options available to homeowners in your area, the factors that impact insurance premiums and some data to help with quote comparisons. This information will help you to make a smart decision when it comes to obtaining a South Dakota home insurance policy.
Why South Dakota residents need a home insurance policy
The state of South Dakota is home to a growing population and experiences severe weather through much of the year, putting homes and families at risk for physical and financial losses. Consider the following reasons for obtaining South Dakota home insurance.
Population growth and financial needs
With a population of about 910,000 and growing, the natural beauty and serenity of South Dakota attracts more people every year. The state has over 400,000 housing units with a median value of over $188,000, and the median household income is $63,920. There are a lot of homes and families in South Dakota that need protection from the possibility of dire financial losses in the case of a disaster.
Snow and freezing temperatures
South Dakota's climate is drier than the national average, with only 23 inches of rain annually compared to the national average of 38 inches. However, the state receives its fair share of snow, with 39 inches averaged each year compared to the United States average of 28 inches. South Dakota is also one of the coldest states in the country, with an average temperature in January of 7 degrees, 167 days per year with nighttime lows below freezing and 26 days each year with lows below 0 degrees.
Severe storms
South Dakota experiences a relatively short but active severe weather season each year, with approximately 300 warnings for tornadoes and severe thunderstorms occurring annually between late May and August. In most years, this places South Dakota in the top ten states for the number of warnings issued. In 2020, the state issued 426 severe weather warnings, which was the fifth highest in the country.
Freezing temperatures, heavy snowfall and severe storms can take a financial toll on South Dakota's growing population, placing residents at high risk for damage to their homes and properties.
Requirements for South Dakota home insurance coverage
If you have a mortgage on your house, your lending institution is likely to require that you obtain a homeowners policy to protect the investment. After you have completed paying off the mortgage, you can determine if you want to continue or cancel the insurance coverage.
A quality insurance policy protects your residence from a variety of hazards and maintains your financial security in the threat of serious disasters that can wreak havoc on your pocketbook. You can find the best policy for your individual situation and budget by comparing South Dakota homeowners insurance quotes. VIU by HUB provides you with the appropriate tools for choosing the right configuration of coverages to meet your needs at a good price.
Home insurance valuation options
Home insurance coverage is extremely customizable and enables you to add options in many combinations to a basic policy in order to protect more of your assets. In the United States, there are multiple types of standardized homeowners insurance packages. There are basic policy forms up to broader, more comprehensive forms that offer several protection levels based on the type of structure and the owner's specific needs.
The dwelling portion of a homeowners policy is the key Property Damage feature. There are three conditions that you can choose for the value that an insurance claim will be paid upon after a loss to the dwelling.
Actual Cash Value
This valuation pays based on the value of the property, minus the cost of depreciation.
Replacement Cost
Coverage at this valuation level pays the cost to rebuild or repair the structure based on current construction costs.
Guaranteed Replacement Cost
This is the most comprehensive valuation level. It pays for the total cost of rebuilding or repairing the home, even if that exceeds the policy limits. Guaranteed replacement cost has a built-in buffer against inflation, but it comes at a much higher cost than the other levels of insurance coverage.
Even if you owe very little on your mortgage, it is advisable to insure the full amount on your home so that you can claim enough funds to adequately repair or rebuild using today's construction estimates and costs.
The cost of home insurance in South Dakota
The national average cost is $1,430 for a $250,000 home. State averages vary widely across the country. The annual cost of an average South Dakota homeowners insurance policy is about 40% higher than the national average cost.
This information is intended for general informational purposes only and is not intended to constitute legal advice.