10 Best Life Insurance Companies in South Dakota
Key Terms
- South Dakota’s life insurance options include whole, universal, and term policies, each offering unique benefits.
- Life insurance policies in South Dakota help ensure financial security for beneficiaries, covering income and potential expenses.
- State-specific regulations include a 10-day free look period and a 30-day grace period for missed payments.
Famously known as the Mount Rushmore State, South Dakota combines vibrant urban life with stunning natural landscapes. From the bustling energy of Sioux Falls to the historic charm of Pierre, this north-central state offers a dynamic environment for its 900,000 residents, bordered by six neighboring states.
According to the Center for Disease Control and Prevention (CDC), the average life expectancy in South Dakota is approximately 76.7 years which is lower than the national average life expectancy, which is currently around 79.05 years in the United States. Over the past few years, the leading causes of death in South Dakota have been cancer, heart disease, and Covid-19. The homicide rate in South Dakota is about 3.6 homicides per 100,000 residents, which is lower than the national average of 7.5.
According to the U.S. Bureau of Labor Statistics, in South Dakota, the 90th percentile earnings is currently $77,210. The median earnings in the state is approximately $37,710. Most financial advisors recommend purchasing a life insurance policy that covers your loved ones for between 10X and 20X your yearly income. In South Dakota, this amounts to around $772,100 – $1,544,200 for most people.
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How life insurance works in South Dakota
Life insurance is one of the best ways that you can protect your loved ones when you pass away. The idea is pretty simple. You make monthly premium payments in exchange for a death benefit which is paid out to your beneficiaries when you die. That said, there are a few different types of life insurance options and some things to know about the life insurance industry.
Whole life insurance is one of the two main types of permanent life insurance products (the other being term life insurance). Unlike term life insurance, which only covers you for a specific period of time, whole life insurance covers you for your entire life. This means that as long as you pay your premiums, your beneficiaries are guaranteed to receive your death benefit, no matter when you die.
Whole life insurance also has a cash value component. When you purchase a whole life insurance policy, part of your premium goes into a cash account that you can access while you’re alive. You can take out loans against the cash value of your policy or use it to pay your premiums if you run into financial difficulties.
Universal life insurance is another option. Universal life insurance policies have a death benefit and a cash value component, like whole life insurance policies. However, the cash value component grows at a faster rate than it does with whole life insurance. This means that you can access your cash value sooner and use it for things like supplemental retirement income or to pay your premiums.
Term life insurance is a bit different. It’s a temporary life insurance policy that only covers you for a specific period of time, typically 10, 20, or 30 years. If you die during that time frame, your beneficiaries will receive your death benefit. Most people should use term life insurance and invest the extra savings in an investment account.