Marcia Hultman

Cabinet Secretary

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Division of Insurance


Homeowners Insurance


Topics of Frequent Inquiry

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Consumer's Guide to Home Insurance - from the National Association of Insurance Commissioners (NAIC) (in Adobe .pdf format*)
Forms for Homeowners Insurance Policies
Home Inventory - Checklist
Nonrenewal of Insurance
Hail Damage
Homeowner Tips on Loss Prevention
Scheduling Personal Property
Types of Coverage
Water in the Basement

 

 

Consumer's Guide to Home Insurance

- from the National Association of Insurance Commissioners (NAIC) (in Adobe .pdf format*)

View guide here.

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Forms for Homeowners Insurance Policies

View webpage here.

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Home Inventory - Checklist

View guide here.

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Nonrenewal of Insurance

Under most circumstances, companies are free to non-renew insurance policies. If someone has had multiple claims or the potential for additional claims, the company will often non-renew a policy.

A notice of nonrenewal must be mailed to the policyholder at least thirty (30) days before the effective renewal date.

If a company pays an insurance claim as a result of the actions of an animal kept on the premises, they may require the animal be removed as a condition of continuing insurance.

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Hail Damage

If you have hail damage to your home the insurance company will pay you for the actual cash value of the repairs until actual repair or replacement is complete. The replacement cost provisions of the policy require that the repairs or replacement be completed within 180 days of the loss to claim on this basis. If you are unable to complete the repairs within this time frame you can request an extension from the company for additional time to claim from the replacement cost provisions. Some policies offered by insurance companies have changed the 180 days to either one or two years. Check your policy for the replacement cost provisions or contact your agent to inquire as to the time frame to complete your repairs or replacement.

If you have prior damage that was not repaired the insurance company will deduct for the damage that was not repaired. If the company allowed for a complete replacement you will not be able to claim damage again.

South Dakota does not have a matching law. If one or two sides of your house is damaged from hail or only one side of your roof sustained damage the insurance company is obligated according to the policy to pay only for what is damaged from hail or wind. There is no obligation to pay for both sides of the roof or all four sides of the house if they are not damaged even though the siding or roof may not match or is obsolete.

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Homeowner Tips on Loss Prevention

See webpage here.

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Scheduling Personal Property

The homeowners’ forms commonly limit amounts paid for loss to certain classes of property. For an example there is a limit on money, securities, watercraft, trailers, theft of jewelry and furs, theft of guns, theft of silverware, and some types of electronic equipment. There is often a need to increase the coverage for these classes of property by endorsement to the homeowners’ policy or by a separate insurance for example a boat owners’ policy.

Items of value can also be insured under a Scheduled Personal Property Endorsement that provides coverage for additional perils. For an example if a woman loses her diamond ring down the garbage disposal or the ring is lost there is no coverage under the homeowners’ forms except a limited dollar amount under the HO-5 form. The only excluded causes of loss that apply to scheduled jewelry are wear and tear, gradual deterioration or inherent vice insects or vermin, war, or nuclear hazard so the lost diamond ring would be covered if scheduled under this endorsement.

If a $50,000 ring is scheduled for this amount and a loss occurs the insured will not necessarily be given a check for $50,000. The company has the option according to the policy provision to settle on the basis of the least of the actual cash value at the time of the loss, the amount it would cost to repair or replace the item, or the amount of insurance. The insurer would therefore have the option to replace the ring from its own sources. There are some insurers that will write jewelry and other items of value on an agreed value basis which means the loss settlement would be based on the full amount shown in the Schedule which is agreed to be the value of that article or property. You can check with your agent to see if this option is available and at what cost.

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Types of Insurance

View webpage here.

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Water in the Basement

Most water damage claims are excluded from the homeowners policies except for an accidental discharge or overflow of water from within a plumbing, heating, air conditioning or from within a household appliance. The system or appliance from which water escaped is not included in the loss.

Damage from flood, surface water, water that seeps or leaks through a building, sidewalk or foundation and water which backs up through sewers or drains is excluded from the policy. Homeowners may buy back coverage taken away by the sewer back up exclusion by endorsing the policy for an additional premium. Coverage may be limited to $5,000.00. Some companies may offer higher limits.

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