ND| In 2025, North Dakota’s 69th Legislative Assembly passed Senate Bill 2374, effective August 1, 2025, which significantly simplified surplus lines placement rules. Under the new law, a risk may be placed with a surplus lines carrier if the producer is aware that the full amount or type of coverage is not available from admitted insurers actually writing that line in North Dakota, or if the risk is referred by a licensed resident insurance producer. Importantly, the old requirement to complete and file a diligent search form (SFN 4818) has been repealed, reducing administrative steps for producers. Additionally, the law clarified that surplus lines insurers cannot issue policies to satisfy laws requiring coverage from admitted carriers, thus reinforcing their role only for nonadmitted placements. Together, these changes streamline the filing process and expand flexibility while maintaining regulatory boundaries.
North Dakota Surplus Lines Law: Then vs. Now
| Topic | 2019 (HB 1075) | 2025 (SB 2374) |
|---|---|---|
| Placement Rule | Producer had to perform a diligent search of admitted carriers before going to surplus lines (unless exempt commercial purchaser). | Producer may place risk if they are aware admitted insurers are not writing the full amount/type of coverage, or if the risk is referred by a licensed producer. |
| Diligent Search Form | Required: Signed diligent search statement (affidavit) filed with commissioner to certify due diligence and advise insured of guaranty fund limits. | Form SFN 4818 repealed – no diligent search affidavit required. |
| Filing Frequency | Required quarterly filings (Mar 1, Jun 1, Sep 1, Dec 1) for placements, endorsements, audits, cancellations + annual tax statement by Mar 1. | Quarterly filing and annual tax requirements remain; reporting can now be done through ND Insurance Department’s Surplus Lines online portal. |
| Domestic Surplus Lines Insurer | Allowed ND domestic insurers with $15M+ surplus to be designated as domestic surplus lines insurers (still treated as “nonadmitted”). | No major changes—still permitted, but reinforced that surplus lines insurers cannot issue policies meant to satisfy laws requiring admitted insurers. |
| Producer Penalties | Civil penalties for late filings ($25/day, max $500 per violation) with possible license suspension/revocation. | Similar enforcement continues; SB 2374 focused more on simplifying placement rules, not altering penalties. |
Key Takeaway
- 2019 HB 1075 modernized reporting by shifting to quarterly schedules and requiring a signed diligent search statement.
- 2025 SB 2374 streamlined placement: surplus lines can now be used without filing a diligent search affidavit if admitted insurers are not writing that coverage or via referral, with filings simplified through the state’s online system.