DEPARTMENT OF INSURANCE
[Constitution, Article V, Section 12; NDCC 26.1-01]
As evidenced by the vast number of laws and other requirements, the regulation of the insurance industry from the 1880s to the present has been a matter of intense interest to the Legislative Assembly of Dakota Territory and the state of North Dakota. Prior to statehood, regulation of the insurance industry was the responsibility of the Territorial Auditor. Beginning in 1883, insurance companies organizing in the territory were required to file a declaration of intention with the Territorial Auditor (S. L. 1883, Ch. 69). The same legislation also provided standards for the investment of funds by insurance companies and the responsibilities of agents. Laws passed in 1885 and 1887 established standards for county mutual insurance companies and required public buildings in the territory to be insured (S. L. 1887, Ch. 68). The insurance regulatory duties of the Territorial Auditor were transferred to the office of the Commissioner of Insurance in 1889. The office of the Commissioner of Insurance was created by the North Dakota State Constitution in 1889. The Commissioner of Insurance was elected to a two-year term and had responsibility for enforcement of state insurance laws, filing of articles of incorporation and reports of insurance companies operating in the state, and reporting violation of insurance regulations to the Attorney General.
In 1911 the State Hail Insurance Department was created to insure growing grain in the state from hail damage (S. L. 1911, Ch. 23). The State Hail Insurance Department was originally under the jurisdiction of the Commissioner of Agriculture and Labor and was transferred to the Commissioner of Insurance in 1915 (S. L. 1915, Ch. 166). Passage of a constitutional amendment in 1918 and amendment of the state hail insurance law in 1919 allowed the state to tax farm land to pay part of the cost of providing hail insurance. The State Hail Insurance Department was repealed in 1967 (S. L. 1967, Ch. 232).
In 1913 the Commissioner of Insurance was required to supervise the State Fire Marshal (S. L. 1913, Ch. 169). The Commissioner of Insurance was designated the ex-officio State Fire Marshal in 1937. Supervision of the State Fire Marshal was assumed by the Attorney General in 1967. The Commissioner of Insurance was made the ex-officio secretary of the State Board of Electricians in 1917 (S. L. 1917, Ch. 118) and was replaced in 1919 by the State Fire Marshal (S. L. 1919, Ch. 123). The Commissioner of Insurance was again made an ex-officio member and secretary of the State Board of Electricians in 1941 (S. L. 1941, Ch. 227) and was removed from that position in 1977 (S. L. 1977, Ch. 399).
Over the years, the Commissioner of Insurance assumed other duties, including the management of special state insurance funds. The State Investment Board has had the authority to establish standards and policy for the investment of monies maintained by the State Bonding Fund for the bonding of public employees [NDCC 26-23]. Authorized in 1913 (S. L. 1913, Ch. 194) and placed under supervision of the Commissioner of Insurance for the purpose of collecting bonding fees and issuing surety or fidelity bonds for public officials the bonding fund provides blanket bond coverage for public employees and all public officials. In 1919 the State Fire and Tornado Fund was created and administered by the Commissioner to insure all public buildings against loss or damage. The fund provides low cost property insurance coverage for political subdivisions and insures all public buildings and their contents against loss or damage caused by fire, tornado, wind, explosion, or other specifically named disasters [NDCC 26-24]. The office also works with the Unsatisfied Judgment Fund consisting of a fund established as protection for North Dakota residents against financial hardship caused by uninsured motorists. Also the Patient Trust Fund is required in nursing care facilities and guarantees that the principal will use patient trust funds in accordance and compliance with the law.
In 1953 the Boiler Inspection program was under the Worker's Compensation Bureau when the State Legislature authorized the appointment of a State Boiler Inspector (S. L. 1953, Ch. 351) to inspect and certify boilers in the state and establish rules and regulations for the proper installation, use, and operation of boilers. In 1993 the Insurance Commissioner became manager of the Fund and responsible to appoint a Chief Boiler Inspector who had at least five years of experience in the construction, maintenance, repair, and inspection of boilers. This included anhydrous ammonia facilities. The statewide boiler inspection program provides mechanical inspection of boilers and pressure vessels and their components. Inspections are conducted on a recurring basis to safeguard the lives of those exposed to vessels under pressure, to protect persons and property generally, and to place by reasonable regulation responsibility for compliance with the owner and user. The Petroleum Tank Release Compensation fund which was created to help pay for cleaning up spills was required by the federal government and requested that all owners of underground petroleum tanks prove their financial ability to clean up petroleum contamination resulting from a spill.
The Commissioner of Insurance through the Insurance Department has seen that all laws of this state respecting insurance companies are executed by administering North Dakota’s insurance laws and code, if there is a violation of law the case is sent to the Attorney General. Responsibilities also include protection for policy holders by examining and licensing insurance companies, officers, agents, brokers, and solicitor agents for business conduct and financial stability. Additionally to conduct a periodic review including inspections and examinations of licensed insurance companies and audit North Dakota based companies to assure financial soundness and compliance with state laws and evaluate the premium rates companies propose to change to assure that the premiums are not excessive, inadequate, or unfairly discriminatory. Other duties include assisting in a program that connects qualified people with discount drugs direct from the manufacturer and the State Health Insurance Program where volunteers assist those with questions about Medicare and related health insurance policies and examinations. Another responsibility is the drafting of legislation and administrative rules proposed by the Department and giving advice to department staff about laws, administrative rules, and the implementation of agency policy. Headquarters for the North Dakota Insurance Department are in the State Capitol in Bismarck. Qualifications for the Commissioner include being qualified elector of the state and at least twenty-five years old.
From 1889-2013 the citizens of North Dakota have been served by twenty Commissioners. During the gubernatorial term of Eli Shortridge, Democrat-Independent James Cudhie served as Commissioner and after one term was defeated in the November 1894 general election. Sixteen Republicans have been elected as Commissioner of Insurance. Sveinung A. Olsness was Commissioner for seventeen years from 1917-1934 and was defeated in the June, 1934 primary election. Among the four Democrats to serve are Earl Pomeroy who was succeeded his brother Glenn. Duties of the Commissioner and the Department are listed in the Century Code [NDCC 26.01-01].
1883 The Territorial Auditor had responsibility for regulating insurance companies (T. L. 1883, Ch. 69).
1887 Public buildings were required to be insured (T. L. 1887, Ch. 68).
1889 The Office of the Commissioner of Insurance was created by the State Constitution (Constitution 1889, Article III, Section 82).
1890 The duties and records were transferred to the Commissioner from the Territorial Auditor (S. L. 1890, Ch. 73).
1911 The State Hail Insurance Department was created and was supervised by the Commissioner of Agriculture and Labor (S. L. 1911, Ch. 23).
1913 The State Bonding Fund was created and managed by the Commissioner of Insurance (S. L. 1913, Ch. 194). The State Fire Marshal was under the supervision of the Commissioner of Insurance (S. L. 1913, Ch. 169).
1915 The State Hail Insurance Department came under management of the Commissioner of Insurance (S. L. 1915, Ch. 166).
1917 The Commissioner of Insurance was made the ex-officio secretary of the State Board of Electricians (S. L. 1917, Ch. 118).
1919 The State Fire and Tornado Fund was created and managed by the Commissioner of Insurance (S. L. 1919, Ch. 159). The Commissioner of Insurance was removed from the State Board of Electricians, but served on the State Auditing Board from 1919 to 1923.
1937 The Commissioner of Insurance was designated the ex-officio State Fire Marshal.
1941 The Commissioner of Insurance was again made ex-officio member and secretary of the State Board of Electricians renamed the State Electrical Board (S. L. 1941, Ch. 227).
1947 The Commissioner of Insurance administered the Unsatisfied Judgment Fund-a fund established as protection for North Dakota residents against financial hardship caused by uninsured motorists.
1963 The State Investment Board was given the authority to establish standards and policy for the investment of monies by the State Bonding Fund [NDCC 26-23]. The State Bonding Fund (supervised by the State Investment Board) was maintained for the bonding of public employees. Since 1963 the Commissioner of Insurance has served on the State Investment Board and supervised by the State Investment Board.
1965 The term of the Commissioner of Insurance was lengthened to four-years (S. L. 1965, Ch. 475).
1967 The Attorney General assumed supervision of the State Fire Marshal (S. L. 1967, Ch. 162) and the State Hail Insurance Department was abolished (S. L. 1967, Ch. 232).
1975 The Insurance Department and the State Health Department were authorized to license health maintenance organizations (S. L. 1975, Ch. 262).
1977 The Commissioner of Insurance was removed from the State Electrical Board (S. L. 1977, Ch. 399.) The Commissioner of Insurance administered the Patient Trust Fund that was set up for the benefit of patients suffering damage caused by negligence of health care providers (S. L. 1977, Ch. 251) The Commissioner served as a member of the Commission on Medical Competency.
1983 Additional duties were defined and a deputy commissioner was appointed. General provisions concerning insurance companies doing business in North Dakota were addressed (S. L. 1983, Ch.332).
1985 Legislation related to the authority of the Commissioner including cease and desist authority and governance regarding qualifications and procedures [NDCC 26.1-26-01] for the licensing of insurance agents, brokers, consultants, limited insurance representatives, and surplus line insurance brokers (S. L. 1985, Ch. 316). Legislation allowed the Commissioner to change fees and renewal fees (S. L. 1985, Ch. 324).
1987 A new section added to the Century Code related to the establishment of and definitions for the Insurance Regulatory Trust Fund and the Investment Trust Fund for the agency (S. L. 1987, Ch. 58).
1989 Legislation addressed penalties for violating North Dakota insurance laws (S. L. 1989, Ch. 342) and fees charged by the Commissioner (S. L. 1989, Ch. 343). Legislation also concerned two new subsections and a new chapter relating to the premiums for insurance finance companies (S. L. 1989, Ch. 344).
1991 A new subsection added to the Century Code related to termination of coverage and to the requirement for insurance companies submitting annual statements (S. L. 1991, Ch. 301).
1993 The act related to group health and small employer coverage, copayments, preventative services, and the repeal of the small employer and employee health insurance coverage (S. L. 1993, Ch. 311). Legislation also addressed fire district map information showing the property location and the fire district serving that property (S. L.1993, Ch. 288) and an amendment relating to the Insurance Regulatory Trust Fund (S. L. 1993, Ch. 1).
1995 Legislation related to the transfer of cash balances from the Insurance Regulatory Trust Fund to the General Trust Fund (S. L. 1995, Ch. 278) and the addition of a new subsection to the Century Code relating to boiler inspections (S. L. 1995, Ch. 276).
1999 Public health laws [NDCC 23-25] revisions and definitions were implemented (S. L. 1999, Ch. 242) and penalty violations including a section on unlawful grounds of declination were addressed (S. L. 1999, Ch. 251).
2001 The Commissioner was given authority to employ an attorney (S. L. 2001, Ch. 10). Annual reports were sent out upon request (S. L. 2001, Ch. 261) and a change was made to the eligibility requirement for participation in a fund created from the premium tax on fire insurance companies. The Commissioner of Insurance was named the Insurance Commissioner (S. L. 2001, Ch. 210).
2009 Legislation related to consultant fees (S. L. 2009, Ch. 243) and allowed the Commissioner to change fees (S. L. 2009, Ch. 242). A new subsection for state agencies and political subdivisions covered bond purchases (S. L. 2009, Ch. 248) and legislation concerned continuing education requirements and exceptions (S. L. 2009, Ch. 252).
2011 Legislation added two new sections to the Code relating to annuity transaction practices (S.L. 2011, Ch. 217). Public Law 111-148 required the Commissioner to ensure compliance of health carrier procedures for external or internal appeals and enforce provisions in compliance with federal legislation by health insurers (S. L. 2011, Ch. 211 and Ch. 218). Additions were made to practices prohibited by insurance businesses (S. L. 2011, Ch. 214) and to legislation defraying the expenses of the Insurance Commission. Payments from insurance premium tax collections were set aside for fire departments (S. L. 2011, Ch. 36). The application date effecting amendments of member insurers to the North Dakota Life and Health Insurance Guaranty Association included powers covering limits and the authority and duties of the Association (S. L. 2011, Ch. 220).
2013 A subsection to the Code concerned criminal history checks on insurance producers by requiring the Commissioner to make arrangements for a new law (S. L. 2013, Ch. 232) and another section related to confidentiality of records received by the office of the Insurance Commissioner that related to consumer assistance (S. L. 2013, Ch. 228). There were also penalties for insurance fraud (S. L. 2013, Ch. 229). Additionally a new section addressed health insurance enrollment periods for individual plans and the role of the Insurance Commissioner (S. L. 2013, Ch. 234) and a new section to the Code related to definitions for short term auto insurance (S. L. 2013, Ch. 235). Legislation addressed the use of insurance premium tax collections for firefighters (S. L. 2013, Ch. 178) and amended laws relating to company policy and the geographic territories of county mutual insurance companies (S. L. 2013, Ch. 230). Non-profit mutual insurance companies were restructured (S. L. 2013, Ch. 231) and a foreign language insurance policy was offered (S. L. 2013, Ch. 233). The Insurance Commissioner was included as a member of Legislative Management Committee to study health care reforms (S. L. 2013, Ch. 415).
30296 State Bonding Fund. Income Register.
30297 State Bonding Fund. Record of Bonds Issued to Municipalities.
30298 State Bonding Fund. Record of Bonds to State Agencies and Institutions.
30299 State Bonding Fund. Record of Bonds Issued to Counties.
30300 State Bonding Fund. General Ledger.
30301 State Bonding Fund. Records of Bonds Issued to Townships.
30302 State Bonding Fund. Record of Bonds Issued to School Districts.
30306 State Fire and Tornado Fund. Insurance Reports.
30310 State Hail Insurance Department. Policy Register.
30311 State Hail Insurance Department. Hail Tax Ledger.
30312 State Hail Insurance Department. Hail Insurance Tax Record.
30313 State Hail Insurance Department. Scrapbook.
30314 State Hail Insurance Department. Storm Map Book.
30495 State Bonding Fund. State Bonding Fund Files.
30733 Administration. Audit Reports.
30734 Administration. Audit Reports of Domestic Insurance Companies.
30735 Administration. Audit Reports of North Dakota Municipalities, Park Boards, and School Districts.
30736 Administration. Register of Insurance Companies Doing Business in North Dakota.
30737 Administration. Register of Fraternal Beneficial Associations in North Dakota.
30738 Administration. Record of Securities Deposited with the Commissioner of Insurance.
30740 State Bonding Fund. State Bonding Fund Bond Record.
30741 Administration. Insurance Commissioner’s Record.
30742 State Bonding Fund. Claim and Process Record.
30743 Administration. Insurance Company Merger File
30744 Administration. Court Case Files.
30745 Administration. Annual Statements of Domestic Insurance Companies.
30753 State Bonding Fund. State Bonding Fund Journal.
30887 Administration. Insurance Agent Register.
30889 Administration. Certificates of Existence and Personnel Reports of Fire Departments.
30890 Administration. Certificates of Authority.
31091 Administration. Commissioner’s Files.
31095 State Hail Insurance Department. Claims Investigations Files.
31220 State Hail Insurance Department. Payroll Ledger.
31323 Administration. Domestic Insurance Company Policies and Rate Schedules.
31425 Administration. Domestic Insurance Company Files.
31433 State Bonding Fund. Balance Sheets.
31860 Company Division. Document File.
31903 Company Division. Agent Master by Company Files.
31904 Company Division. Agent Master by Name Files
31925 Company Division. Insurance Company and Agent Hearing File.
32065 Company Division. Domestic Policy Filings.
32164 Administrative Division. Journal, 1935-1937. (Vol. 14)
32165 Administrative Division. Ledger, 1939-1942. (Vol. K)
32175 North Dakota World Trade, Inc. Records.
Gray, David P. Guide to the North Dakota State Archives, 1985.
Laws of Dakota Territory.
Legislative History of North Dakota State Agencies: Richard J. Wolfert State Librarian. State Library Commission, 1978.
North Dakota Century Code.
North Dakota Insurance Department Website.
North Dakota Secretary of State Blue Book.
North Dakota State Legislature Session Laws.
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