South Dakota Surety Bonds

Surety Bond Requirements in SD

Surety bonds are required for many professionals in the state of South Dakota in order to protect the public from financial harm. All of these bonds are required at the state level except for building contractor bonds, which are mandated by several SD cities including Sioux City and Sioux Falls.

To make sure you are in compliance with your state or city’s bonding regulations, contact an NNA Surety Bonds specialist.  We’ve been providing affordable coverage to companies and individuals across the United States since 1957.

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We offer the following surety bonds in the state of South Dakota:

Appraisal Management Company (AMC) Bond

Appraisal management companies are required to obtain a $25,000 surety bond by the South Dakota Department of Labor and Regulation in order to get a business license. The bond provides some financial protection to anyone who suffers a loss due to negligent or improper acts or breach of contract by the appraiser or appraisal management company, as detailed in South Dakota Codified Law 36-21D-10. Improper acts may include altering a report submitted by an appraiser or attempting to impair an appraiser’s independence and impartiality.

Bond approval is subject to underwriting, meaning various factors are taken into consideration to calculate your premium. Applicants with excellent credit could pay a premium as low as $250.

General Building Contractor Bond

Only three construction trades are licensed at the state level in South Dakota: electricians, plumbers, and asbestos abatement contractors. General building contractors in SD are not licensed or bonded at the state level.

The city of Sioux Falls requires residential building contractors to post a $20,000 bond. Sioux City requires a license bond in the amount of $10,000 for general building contractors. Other cities that require general contractors to be licensed include Aberdeen, Brandon, and Brookings. If you have questions about your city’s bonding regulations, contact NNA Surety Bonds for help.

Money Lender Surety Bond

The South Dakota Division of Banking requires money lenders to post a bond in the amount of $10,000 for their first location and $2,500 for each additional business location, according to SD Codified Laws 54-4-42. This bond provides a means of compensation for any injured party whose claim against the lender is upheld. Prohibited acts include breach of trust or fiduciary duty, violation of state or federal statutes, making false representations, and engaging in unfair lending practices.

Bond premiums cost a small percentage of the bond’s full coverage amount, and will vary with the size of your policy and underwriting assessment of your credit score and business finances.

Mortgage Broker Bond

Mortgage brokers in South Dakota must post a surety bond sized according to the table below:

Bond Amounts For South Dakota Mortgage Brokers
Annual Loan Volume Bond Amount Annual Premium
Up to $25 million $25,000 $188
$25 million to $100 million $35,000 $263
Over $100 million $50,000 $375

This policy helps protect customers in the event of improper lending practices by the mortgage broker, such as pressuring buyers into specific loan products, charging unnecessary fees, targeting at-risk buyers, and encouraging buyers to provide fraudulent information during the application process.

Licenses are applied for and bonds posted electronically via the Nationwide Multistate Licensing System (NMLS). Your premium for a mortgage broker bond in South Dakota will range from $188 to $375 depending on the size of your bond.

Vehicle Dealer Surety Bond

If you are engaged in the business of selling vehicles and your sales exceed five vehicles in a 12-month period, the South Dakota Department of Revenue considers you a dealer and requires you to be licensed and bonded. The amount of bond coverage needed for your dealership will depend on the type of vehicles you sell.

Bond Amounts for South Dakota Vehicle Dealers
Vehicle Type Bond Amount Annual Premium
New and used vehicles, mobile homes $25,000 $250
Trailers (over 3,000 lbs.) $10,000 $100
Boats $20,000 $200
Motorcycles, off-road vehicles, and snowmobiles $5,000 $100

Auto dealers in The Mount Rushmore State can expect to pay $250 per year for a $25,000 bond policy through NNA Surety Bonds.

South Dakota Surety Bond Costs
Bond Name Coverage Amount Cost
(Annual Premium)
Regulatory Authority
Appraisal Management Company Bond $25,000 $250* SD Dept. of Labor and Regulation
Building Contractor Bond $10,000 minimum $100* Cities and municipalities
Money Lender Bond $10,000 (first location)
$2,500 (each addition location)
Varies* SD Division of Banking
Mortgage Broker Bond $25,000/$35,000/$50,000 $188/$263/$375 SD Division of Banking
Vehicle Dealer Bond $25,000 $250 SD Dept. of Revenue

* Cost can vary depending on the bond amount required and your credit rating

Our knowledge of South Dakota bond requirements allows us to provide accurate quotes quickly. For guidance through the process of selecting surety bonds for your business, talk to one of our experts today.

For faster service, call us at 855-215-2160
Monday to Friday, 6 a.m. to 5 p.m. (PT)

Providing Bonds and Insurance Since 1957