The proposed bill establishes a minimum damage threshold for declaring a motor vehicle a total loss in South Dakota. According to the new legal language, an insurer is prohibited from declaring a vehicle a total loss due to damage from various causes, such as collisions or weather, unless the repair costs are at least seventy-five percent of the vehicle's actual cash value prior to the damage. This aims to protect vehicle owners from premature total loss declarations that may not reflect the true value of their vehicles.

Additionally, the bill allows for an exception where an insurer can declare a vehicle a total loss at the request and with the written consent of the vehicle owner, even if repair costs are below the seventy-five percent threshold. The bill also defines "actual cash value" as the current market value of the vehicle within a 200-mile radius of the owner's primary address, taking into account factors such as the vehicle's year, make, model, accessories, normal wear and tear, odometer reading, and accident history.