North Dakota Administrative Code Title 45 - Insurance, Commissioner of
Overview of NDAC Title 45 – Insurance, Commissioner of
Title 45 of the NDAC governs the regulation of insurance companies and agents in North Dakota under the oversight of the Insurance Commissioner. Its goals are to:
Protect policyholders and the public from unfair practices.
Ensure solvency of insurance companies.
Regulate licensing of insurance agents, adjusters, and companies.
Establish standards for insurance products, rates, and claims handling.
Provide enforcement powers for violations, including fines, license revocations, and corrective orders.
Key areas covered by Title 45 include:
Licensing requirements for insurers and agents
Examination and reporting requirements for insurance companies
Rate approval and filing standards
Claims handling and consumer protection rules
Enforcement, penalties, and administrative hearings
Case 1: Licensing of an Insurance Agent
Situation
An individual applies to become a licensed insurance agent in North Dakota.
NDAC Requirements
Submit a license application, including personal information and background checks.
Complete pre-licensing education and pass an examination.
Maintain continuing education credits for license renewal.
Commissioner’s Role
Review the application for completeness and compliance with NDAC rules.
Deny licenses for criminal convictions related to fraud, dishonesty, or financial misconduct.
Outcome
If approved, the individual may sell insurance in North Dakota.
Denial may occur if the applicant fails the exam or has disqualifying criminal history.
Importance
Ensures that only qualified, trustworthy individuals sell insurance products to the public.
Case 2: Rate Filing and Approval for Property Insurance
Situation
An insurance company wants to change the premium rates for homeowners’ insurance policies.
NDAC Requirements
File proposed rates and supporting actuarial data with the Insurance Commissioner.
Demonstrate that rates are adequate, not excessive, and not unfairly discriminatory.
Commissioner’s Role
Review actuarial data and compliance with state insurance laws.
Approve, disapprove, or request modifications to the rate filing.
Outcome
Company may implement new rates once approved.
Disapproved rates cannot be charged until adjustments are made.
Importance
Protects consumers from unjustified or discriminatory premiums.
Case 3: Examination of an Insurance Company
Situation
The Insurance Commissioner conducts a routine financial examination of a licensed insurer to ensure solvency.
NDAC Requirements
Insurer must provide financial statements, investment records, and claims data.
Commissioner examines reserves, risk management, and corporate governance.
Outcome
Minor deficiencies may result in recommendations or corrective action plans.
Major deficiencies may trigger formal enforcement actions, including license suspension.
Importance
Ensures insurance companies remain financially stable and able to meet policyholder obligations.
Case 4: Investigation of a Consumer Complaint
Situation
A policyholder complains that their insurance company improperly denied a claim for property damage.
NDAC Requirements
Commissioner investigates complaints about unfair claims practices.
Insurance companies must provide supporting documentation and explanations.
Outcome
If the complaint is valid, the Commissioner may order the company to pay the claim or revise its practices.
Repeat violations can lead to fines, probation, or license suspension.
Importance
Protects policyholders from unfair treatment and ensures proper claims handling.
Case 5: Disciplinary Action Against an Agent
Situation
An insurance agent is found to have misrepresented policy terms to clients.
NDAC Requirements
Commissioner may conduct a hearing to review alleged misconduct.
Evidence is evaluated, and the agent is given an opportunity to respond.
Outcome
Possible sanctions include reprimand, fines, probation, or revocation of license.
Corrective actions may require retraining or restitution to affected clients.
Importance
Maintains the integrity of the insurance market and public trust in agents.
Case 6: Approval of a New Insurance Product
Situation
An insurer wants to introduce a new type of life insurance policy in North Dakota.
NDAC Requirements
Submit the policy form and contract language to the Commissioner.
Ensure compliance with state policy form standards, disclosure requirements, and solvency protections.
Outcome
Commissioner approves, disapproves, or requests modifications.
Only approved policies may be sold in the state.
Importance
Protects consumers by ensuring clarity, fairness, and compliance with state law.
Key Takeaways
Title 45 NDAC regulates all aspects of insurance in North Dakota.
The Insurance Commissioner oversees licensing, solvency, product approval, and consumer protection.
Common scenarios include:
Licensing agents
Rate approvals
Company examinations
Consumer complaint investigations
Agent disciplinary actions
New product approvals
Enforcement ensures that insurers and agents act ethically, financially responsibly, and in compliance with state law.
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