North Dakota House Bill HB1124

North Dakota 2025-2026 Regular Session

• Introduced: 1/7/25
• Refer: 1/7/25
• Report Pass: 1/13/25
• Engrossed: 1/15/25
• Refer: 2/5/25
• Report Pass: 2/21/25
• Enrolled: 3/12/25
• Passed: 3/18/25

Caption

The standards and management of an insurer with an insurance holding company system and the confidential treatment of investigation and examination records of insurance holding companies.

Impact

The enactment of HB 1124 will impact various aspects of state insurance law, primarily by centralizing regulatory authority and improving financial oversight of insurance holding company systems. Insurers will be required to adhere to updated standards for reporting and managing their capital, as well as conducting liquidity stress tests. The bill's focus on confidentiality will protect sensitive business information while still mandating that relevant parties comply with heightened disclosure requirements. As a result, this is expected to foster a more reliable insurance environment along with increased protections for policyholders.

Summary

House Bill 1124 is designed to amend and reenact several sections of the North Dakota Century Code concerning the standards and management of insurers operating within insurance holding company systems. The bill aims to enhance regulatory oversight by outlining the requirements for transparency regarding ownership, financial conditions, and management of insurers and their affiliates. It introduces provisions that require insurers to file detailed registration statements, including information about transactions with affiliates and compliance with national standards set by the National Association of Insurance Commissioners (NAIC). This ensures a more consistent and rigorous approach to insurance regulation across the state.

Sentiment

General sentiment surrounding HB 1124 has been positive, particularly among those advocating for increased regulatory measures in the insurance sector. Supporters argue that the bill will fortify the financial structure and operational integrity of insurers, ultimately benefiting policyholders by ensuring companies maintain sufficient capital reserves. However, some stakeholders have expressed concerns about the potential regulatory burden this may impose on smaller insurers, fearing it could limit competition and reduce market entry opportunities. As such, the conversation reflects a balance between necessary oversight and the need for a vibrant insurance market.

Contention

Notable points of contention related to HB 1124 include debates over the appropriate balance between regulatory oversight and market competitiveness. Some critics suggest that the stringent reporting requirements could disproportionately affect smaller insurance companies, leading to potential market consolidation. Additionally, the bill’s emphasis on maintaining confidentiality while enhancing transparency raises questions about how best to protect sensitive business information without compromising regulatory efficacy. The discussions highlight the ongoing struggle to find a regulatory framework that both protects consumers and supports a diverse insurance marketplace.