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SB 2374

AN ACT to create and enact two new sections to chapter 26.1-30, two new sections to chapter 26.1-39, a new section to chapter 26.1-44, and a new subsection to section 26.1-46-03 of the North Dakota Century Code, relating to mandatory arbitration endorsements for property insurance, managed repair programs, civil remedy actions against property insurers, notice of property insurance claims, and surplus lines insurance policies; to amend and reenact sections 26.1-02-05, 26.1-25-02.1, 26.1-25-16, 26.1-26-04.1, 26.1-44-03, 26.1-46-01, 26.1-46-08, and 26.1-46-08.1 of the North Dakota Century Code, relating to exceptions to unauthorized insurance transactions, exceptions for large commercial risks in fire, property, and casualty insurance rates, surplus lines insurance, risk retention groups and purchasing groups, restrictions on insurance purchased by purchasing groups, and purchasing group taxation and fees; to repeal section 26.1-44-03.3 of the North Dakota Century Code, relating to an exemption from search requirements for licensed surplus line producers; to provide for a legislative management report; and to provide a penalty.

69th Legislative Assembly (2025-26) Introduced by Jeff Barta and 5 co-sponsors

SB 2374 broadens North Dakota insurance oversight by requiring holding‑company registration, expands surplus lines compliance, tightens large commercial risk definitions, and adds

Filed with Secretary Of State 05/01
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WeVote Research Nonpartisan
Bill Summary · SB 2374

Summary — SB 2374 (North Dakota, 2025)

Purpose

SB 2374 updates North Dakota insurance law across multiple topics including property-insurance dispute resolution, managed-repair programs, surplus lines oversight, insurance holding-company reporting, and regulation of risk-retention/purchasing groups. It also revises definitions and exceptions related to large commercial risks, adds enforcement/penalty provisions, and directs a legislative-management report.

Key provisions (high-level)

  • Creates new statutory sections (two in chapter 26.1-30, two in chapter 26.1-39, one in chapter 26.1-44, and a new subsection to 26.1-46-03) addressing:
    • Mandatory arbitration endorsements for property insurance (requiring or authorizing arbitration clauses/end‑orsements in property policies).
    • Managed repair programs (standards for insurer‑directed repair networks or contractor programs).
    • Civil remedy actions against property insurers (clarifying conditions or limits for insureds’ lawsuits).
    • Notice requirements for property insurance claims.
    • Requirements for surplus lines insurance policies.
  • Amends holding‑company and insurer registration rules:
    • Strengthens the presumption of “control” in insurance holding company systems (presumed at 10% or more voting securities; commissioner may make control determinations).
    • Requires insurers in holding systems to register with the Commissioner and file a registration statement within 15 days of becoming subject to registration and annually by March 1.
  • Revises definitions and rate/market rules for “large commercial risk” (now defined to include any insured with total insured property values ≥ $25 million; gross revenues ≥ $50 million; or premium thresholds — $100,000 for property, $100,000 for general liability, $200,000 for multiperil). Farming/ranching excluded.
  • Changes surplus lines law:
    • Amends section 26.1-44-03 and repeals section 26.1-44-03.3 (removes an exemption from producer search requirements for licensed surplus line producers).
    • Updates producer/search obligations and surplus line policy formalities.
  • Modifies provisions governing risk retention groups and purchasing groups, including restrictions on what insurance purchasing groups may buy and related taxation/fee rules (sections 26.1-46-01, -08, -08.1).
  • Establishes a legislative-management reporting requirement and creates a penalty for specified violations.

Who is affected

  • Insurers (domestic and non‑domestic), particularly those in holding company systems — new reporting and control rules.
  • Surplus-line producers and surplus lines markets — expanded search and compliance duties.
  • Large commercial insureds (per new thresholds) — changes in how certain rate or market exceptions apply.
  • Purchasing groups and risk retention groups — new limits, tax and fee consequences.
  • Property policyholders and contractors — changes to claims notice rules, managed repair programs, and arbitration/remedy pathways.

Procedural status / timeline

  • Introduced March 12, 2025; progressed through committee and conference committee amendments in spring 2025.
  • Conference committee amendments adopted April 24, 2025.
  • Filed with Secretary of State: May 1, 2025 (enrolled version available). Bill includes a penalty provision and a legislative-management report requirement.

Practical impact / notes

The bill centralizes more regulatory oversight (holding-company registration and surplus line compliance), tightens definitions for what constitutes a “large commercial risk,” and adds statutory structure for insurer-driven repair programs and arbitration of property claims. Exact operational effects (for example, how arbitration endorsements will be implemented or limits on civil remedies) depend on the full language of the new sections and subsequent rule-making by the Insurance Commissioner. This summary is based on committee and engrossed versions available in the bill file.

Compiled from official sources — confirm details with the bill’s official record.

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