South Dakota Workers’ Compensation

You can save up to 25% in discounts on business insurance.*

What can be covered by South Dakota Workers’ Compensation insurance?

Medical expenses

Medical expenses

Like exams, treatment and rehabilitation.
Lost wages

Lost wages

For employee recovery after a work injury.


To teach injured employees new skills if they can no longer do their jobs.
Permanent injury

Permanent injury

Benefits for employees who can no longer work due to injury.

Is South Dakota Workers’ Compensation insurance required?

No employers are required to carry workers’ compensation insurance in South Dakota, according to the South Dakota Department of Labor & Regulation. Businesses that voluntarily choose to carry workers’ comp insurance must provide medical and disability benefits to their employees.

Though workers’ comp is not required, the state highly recommends this insurance for businesses with employees. With coverage, employers provide protection for employees who are injured on the job, and also limit the financial risk to their business.

If an employee gets hurt at work, a South Dakota workers’ comp policy could help pay for:

Without workers’ comp insurance, an employer could be sued in civil court by an injured worker.

How does Workers’ Comp work in South Dakota?

A South Dakota workers’ comp policy covers medical care for employees who get injured on the job, including:

  • Medical, surgical and hospital services
  • Physical rehabilitation services
  • Prosthetic devices and body aids
  • Travel, lodging and meals when traveling to receive medical care
  • Lost wages
  • Death benefits

If an injury causes a serious impairment and/or affects the employee’s ability to work, South Dakota’s workers’ compensation income benefit options include:

Temporary partial disability. An employee is able to return to work but can’t work the same number of pre-injury hours.

Temporary total disability. An employee has to miss work for seven consecutive days or more due to their injury.

Permanent partial disability. An employee suffers an impairment of certain body parts, with benefits corresponding to a level of impairment determined by a medical practitioner.

Permanent total disability. An employee suffers a total disability due to their injury and is entitled to receive weekly benefits for life.

Death benefits in South Dakota include compensation for dependents and/or family members when an employee dies as the result of an injury.

Any South Dakota employer who chooses to carry workers’ comp insurance must submit a First Report of Injury form to their insurance carrier within seven days of written notice of an employee injury.

Additionally, employers are required to post information encouraging safety in the workplace.

Learn more about workers’ compensation coverage.

How much is Workers’ Comp insurance in South Dakota?

Workers’ compensation costs vary across industries. Factors that influence price include:

  • The number of employees and the type of work they do
  • Your total payroll
  • Your insurance claims history
  • The locations where you do business

The best way to determine the insurance rate for your business is to get a free instant quote from NEXT.

What if you don’t have Workers’ Compensation insurance in South Dakota?

Employers who fail to report work-related injuries to their insurance carrier within seven days using a First Report of Injury form may be charged with a Class 2 misdemeanor and could be subject to a $100 civil penalty.

Who is exempt from South Dakota Workers’ Compensation insurance?

South Dakota workers’ compensation laws apply to all employees with a few exceptions, including:

  • Farm and agricultural laborers.
  • Domestic servants (unless working for their employer more than 20 hours in any calendar week and for more than six weeks in a 13-week period).
  • Independent contractors (employees whose work is not in the usual course of trade, business, occupation or profession of the employer), which may include certain real estate agents and owner-operators of trucks.
  • Certain elected officials of the state or any subdivision of government.
  • Workfare participants.

South Dakota does not require business owners to carry workers’ compensation insurance for themselves. However, some choose to maintain this coverage to minimize their financial risk.

Those who work for a governmental agency may participate in the state’s worker’s compensation system as sole proprietors.

If an employer wants to self-insure their company for workers’ comp, they must apply to the South Dakota Department Of Labor And Regulation’s Division Of Labor And Management.

How NEXT helps South Dakota small business owners

NEXT offers an easy way to get a free workers’ compensation insurance quote, purchase coverage and instantly share a certificate of insurance in about 10 minutes.

NEXT strives to resolve every claim quickly. Learn more about our claims process and how our claims advocates will work with you after an employee injury.

Start a free instant quote with NEXT.

Other important business insurance policies in South Dakota

Workers’ compensation insurance provides many important protections, but you’ll need additional coverage to protect from all the risks your small business can face.
Many South Dakota small businesses also consider:
General Liability
General Liability insurance

General liability insurance protects your business from common mistakes or accidents, such as customer injury or damages to someone’s property.

Commercial Auto
Commercial Auto insurance

In South Dakota, all business-owned vehicles must be covered by commercial auto insurance. If you drive or use your personal vehicle for work, commercial auto insurance helps protect your business from accidents.

Commercial Property
Commercial Property insurance

Commercial property insurance can provide financial help if your business structures, goods, gear or inventory are damaged or destroyed by a covered event.

Errors & Omissions
Professional Liability insurance

Professional liability insurance, also called errors & omissions insurance, provides financial protection against claims of professional mistakes and negligence.

More resources for small business owners

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* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
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Issuance of coverage is subject to underwriting. Not available in all states. Please see the policy for full terms, conditions and exclusions. Coverage examples are for illustrative purposes only. Your policy documents govern, terms and exclusions apply. Coverage is dependent on actual facts and circumstances giving rise to a claim. Next Insurance, Inc. and/or its affiliates is an insurance agency licensed to sell certain insurance products and may receive compensation from insurance companies for such sales. Policy obligations are the sole responsibility of the issuing insurance company. Refer to Legal Notices section for additional information.

Any starting prices or premiums represented before an actual customer quote are not guaranteed and are representations of existing premiums of active policies as of December 6, 2023. To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.