North Dakota writes its insurance rules into N.D. Cent. Code Title 26.1 and the administrative rules adopted under it, and the state-law portion of your exam is drawn directly from that framework. This guide turns those statutes into plain-English study notes so the North Dakota questions feel familiar. Read it once now and again the night before the test.

The regulator: the North Dakota Insurance Department

Insurance in North Dakota is overseen by the North Dakota Insurance Department, led by the Commissioner of Insurance. Memorize one fact above all others here: the North Dakota commissioner is elected by the voters of the state, not appointed by the governor. That makes the office politically independent and is a favorite exam point. The Commissioner licenses companies and producers, reviews rates and forms, monitors solvency, investigates consumer complaints, and enforces the state's consumer-protection law.

Vocabulary the exam assumes you know:

• Certificate of authority – the license a company needs to transact insurance in North Dakota; an individual agent holds a producer license.
• Admitted (authorized) vs. surplus lines (non-admitted) – admitted carriers are Department-licensed and backed by the guaranty associations; surplus lines carriers are not, and are used for hard-to-place risks only after a diligent search of the admitted market.
• Domestic, foreign, and alien insurers – domestic = formed in North Dakota, foreign = another U.S. state, alien = another country.
• Stock, mutual, and reciprocal insurers are all recognized organizational types.

Producer (agent) licensing

North Dakota calls agents producers. To get licensed you generally complete any required prelicensing steps, then pass the licensing exam administered by the state's testing vendor (Prometric is commonly used—verify the current vendor). Separate lines of authority exist for Life, Health (accident & health), Property, and Casualty (among others), and you apply and pay through NIPR. To sell commercial property and liability coverage you need the property and casualty lines of authority; to sell life and major medical you need the life and health lines.

A few North Dakota specifics worth memorizing:

• Continuing education. Resident producers must complete the required continuing education, including an ethics component, within each renewal period before renewing—verify the current hours, since these are set by rule and change.
• Reporting duties. A producer must report a change of address to the Department within the required time, and must report administrative actions and criminal prosecutions within the required period.
• Hearing rights. A producer whose application or license is denied, suspended, or revoked generally may request a hearing to contest the decision.
• Commission sharing. Commissions may generally be shared only with properly licensed producers, never paid to the client as a disguised rebate.
• Controlled business. A producer cannot obtain a license mainly to write coverage on the producer's own and family interests.

Appointments and termination reporting

• An appointment links a producer to a specific insurer the producer represents; before transacting business on an insurer's behalf, the insurer generally must appoint the producer.
• When an insurer terminates a producer's appointment, it must notify the Department within the required time, reporting the cause where the termination involved wrongdoing.
• Producers must keep transaction records the Commissioner can review during an investigation or market-conduct examination.

Unfair trade and claims practices

Title 26.1 prohibits unfair methods of competition and unfair or deceptive acts. Memorize the classic prohibited practices, because the exam tests them by name:

• Misrepresentation of policy terms or benefits—for example, telling a client a homeowners policy covers flood when it does not.
• Twisting – using misrepresentation to convince someone to drop one policy for another to the insured's detriment.
• Defamation – maliciously false statements that an insurer is financially unsound.
• Boycott, coercion, and intimidation – for example, requiring a borrower to buy insurance from a particular agent as a condition of a loan.
• Rebating – giving cash or anything of value not specified in the policy as an inducement to buy.
• Unfair discrimination between insureds of the same class and equal expectation of life or hazard.
• False advertising / deceptive sales practices.
• Commingling – depositing client premium funds into a personal account rather than a separate trust account, a breach of fiduciary duty.

North Dakota also enforces an unfair claims settlement practices standard. Knowingly misrepresenting policy provisions to avoid a valid claim, or failing to promptly investigate and settle a clearly covered claim, is prohibited. The Commissioner may issue a cease and desist order, impose monetary penalties, or suspend or revoke a license. Insurance fraud—such as staging an accident or submitting a false claim—carries civil and criminal penalties.

Solvency, examinations, and consumer protections

• The Commissioner may examine the financial condition and market conduct of insurers, and conducts periodic financial examinations of domestic insurers to confirm solvency and compliance.
• Insurers must maintain minimum capital and surplus so they can pay future claims.
• Rates must generally be filed and may not be excessive, inadequate, or unfairly discriminatory.
• Privacy rules limit how a customer's nonpublic personal and health information may be shared.
• Replacement rules require producers to deliver the prescribed notice and comparison information when one life or health policy replaces another. New policies typically carry a free-look right to return the policy for a refund.

Guaranty associations

If an admitted insurer becomes insolvent, North Dakota guaranty mechanisms pay certain covered claims, funded by assessments on member insurers:

• North Dakota Life and Health Insurance Guaranty Association – covers certain life, annuity, and health claims up to statutory limits.
• North Dakota Insurance Guaranty Association – covers certain property & casualty claims of an insolvent P&C insurer. Note the major carve-out: because North Dakota's workers' compensation is a monopolistic state fund (WSI), workers' comp is excluded from the P&C guaranty association.

Surplus lines / non-admitted carriers are not covered, and producers may not advertise guaranty-association protection to make a sale.

Key North Dakota numbers to memorize

Common exam traps

• Calling the head an appointed "Director." North Dakota is led by an elected Commissioner of Insurance.
• Putting workers' comp inside the guaranty system. North Dakota WC is a monopolistic state fund (WSI) and is excluded from the P&C guaranty association.
• Assuming surplus lines are guaranty-protected. Only admitted insurers are backed by the guaranty associations.
• Confusing twisting and misrepresentation. Twisting specifically uses misrepresentation to induce a policy switch.
• Mixing up the two guaranty bodies. P&C = North Dakota Insurance Guaranty Association; life/health = North Dakota Life and Health Insurance Guaranty Association.
• Calling commingling a lawful practice. Mixing client premium with personal funds is prohibited.

Quick recap

The North Dakota Insurance Department, led by an elected Commissioner of Insurance, regulates insurance under N.D. Cent. Code Title 26.1. Producers test through the state vendor (commonly Prometric—verify), apply through NIPR, and hold lines of authority for life, health, property, and casualty. The code bans misrepresentation, twisting, rebating, defamation, coercion, unfair discrimination, and commingling, and requires fair, prompt claims handling enforced by cease and desist orders, fines, and license actions. Insolvent admitted insurers are backstopped by the North Dakota Insurance Guaranty Association (P&C) and the North Dakota Life and Health Insurance Guaranty Association—but remember that workers' compensation runs through the monopolistic WSI state fund and is excluded from the P&C guaranty system. Verify any specific figure, and the North Dakota state section is yours.