# Title 39 — Motor Vehicles

## Chapter 39-16.1 — Proof of Financial Responsibility for the Future

### § 39-16.1-01. Application.

The provisions of this chapter requiring the deposit of proof of financial responsibility for the
future, subject to certain exemptions, apply with respect to any person who has been convicted
of or forfeited bail for certain offenses under motor vehicle laws or who has failed to pay
judgments upon claims for relief arising out of ownership, maintenance, or use of vehicles of a
type subject to registration under the laws of this state.
### § 39-16.1-02. Proof of financial responsibility defined.

Repealed by S.L. 2013, ch. 291, § 62.
### § 39-16.1-03. Notice of failure to satisfy judgment.

When any person fails within thirty days to satisfy any judgment, it is the duty of the clerk of
the court, or of the judge of a court which has no clerk, in which any such judgment is rendered
within this state, to forward to the director immediately after the expiration of said thirty days, a
certified copy of such judgment or a certified copy of the docket entries in an action resulting in
a judgment for damages or a certificate of facts relative to a judgment on a form provided by the
director. If the judgment debtor is a nonresident, the director shall transmit a certified copy of the
judgment to the official in charge of the issuance of drivers' licenses of the state of which the
judgment debtor is a resident.
### § 39-16.1-04. Suspension of license - Temporary release.

1. The director, upon receipt of a certified copy of a judgment or a certified copy of the
docket entries in an action resulting in a judgment for damages or a certificate of facts
relative to a judgment on a form provided by the director, shall forthwith suspend the
license or operating privilege, of any person against whom such judgment was
rendered except as hereinafter otherwise provided in this section and in section
39-16.1-06.
2. If the judgment creditor consents in writing, in such form as the director may prescribe
that the judgment debtor be allowed license or nonresident's operating privilege, the
same may be allowed by the director for six months from the date of such consent and
thereafter until such consent is revoked in writing, notwithstanding default in the
payment of such judgment, or of any installments thereof prescribed in section
3. Any person whose license or nonresident's operating privilege has been suspended or
is about to be suspended or will become subject to suspension under this chapter may
be relieved from the effect of the judgment as prescribed in this chapter by filing with
the director an affidavit stating that at the time of the accident upon which the
judgment has been rendered the affiant was insured, that the insurer is liable to pay
the judgment, and the reason, if known, why the insurer has not paid the judgment.
That person shall also file the original or a copy of the insurance policy, if available,
and any other documents the director may require to show that the loss, injury, or
damage for which the judgment was rendered, was covered by the insurance policy. If
the director is satisfied from such papers that the insurer was authorized to issue the
insurance policy at the time and place of issuing the policy and that the insurer is liable
to pay the judgment, at least to the extent and for the amounts required in this chapter,
the director may not suspend the license or nonresident's operating privilege, or if
already suspended shall reinstate them.
4. A license or nonresident's operating privilege must remain suspended and may not be
renewed, nor may any such license be thereafter issued in the name of such person,
including any such person not previously licensed, unless and until every such
judgment is satisfied in full or to the extent hereinafter provided and until the said

person gives proof of financial responsibility subject to the exemptions stated in
sections 39-16.1-04 and 39-16.1-06.
### § 39-16.1-05. Satisfaction of judgment.

Judgments herein referred to must, for the purpose of this chapter only, be deemed
satisfied:
1. When twenty-five thousand dollars has been credited upon any judgment or judgments
rendered in excess of that amount because of bodily injury to or death of one person
as the result of any one accident;
2. When, subject to such limit of twenty-five thousand dollars because of bodily injury to
or death of one person, the sum of fifty thousand dollars has been credited upon any
judgment or judgments rendered in excess of that amount because of bodily injury to
or death of two or more persons as the result of any one accident; or
3. When twenty-five thousand dollars has been credited upon any judgment or judgments
rendered in excess of that amount because of damage to or destruction of property of
others as a result of any one accident. Payments made in settlement of any claims
because of bodily injury, death, or property damages arising from a motor vehicle
accident must be credited in reduction of the amounts provided for in this section.
### § 39-16.1-06. Installment payments.

1. A judgment debtor upon due notice to the judgment creditor may apply to the court in
which such judgment was rendered for the privilege of paying such judgment in
installments and the court, in its discretion and without prejudice to any other legal
remedies which the judgment creditor may have, may so order and fix the amounts
and times of payment of the installments.
2. The director may not suspend a license, or a nonresident's operating privilege,
suspended following nonpayment of a judgment, when the judgment debtor gives
proof of financial responsibility and obtains such an order permitting the payment of
such judgment in installments, and while the payment of any said installment is not in
default.
3. In the event the judgment debtor fails to pay any installment as specified by such
order, then upon notice of such default, the director shall forthwith suspend the license,
or nonresident's operating privilege of the judgment debtor until such judgment is
satisfied as provided in this chapter.
### § 39-16.1-07. Revocation or suspension of license for reasons other than provisions of

this chapter.
1. Whenever the director under any other law of this state, except sections 39-06-40 and
39-06-40.1, revokes the license of any person, the license must remain revoked and
may not be renewed nor shall any license be issued to such person, unless the person
gives and maintains proof of financial responsibility.
2. If a person by final order or judgment is convicted of or forfeits any bail or collateral
deposited to secure an appearance for trial for any offense requiring the revocation of
license, driving or being in actual physical control of a vehicle while under the influence
in violation of section 39-08-01 or equivalent ordinance, or operating a motor vehicle
upon the highway while the person's license or privilege to drive is under suspension
for a violation requiring a license or privilege to drive suspension of at least ninety-one
days or revocation, the license or driving privilege must be suspended or revoked and
no license may be issued or returned to the person, unless the person gives and
maintains proof of financial responsibility.
### § 39-16.1-08. Proof of financial responsibility.

Proof of financial responsibility when required under this chapter may be given by filing:
1. A certificate of insurance as provided in sections 39-16.1-09 and 39-16.1-10;
2. A bond as provided in section 39-16.1-14; or

3. A certificate of deposit of money or securities as provided in section 39-16.1-15.
### § 39-16.1-09. Proof by showing insurance coverage.

1. Proof of financial responsibility may be furnished by filing with the director the written
or electronically transmitted certificate of any insurance carrier duly authorized to do
business in this state certifying that there is in effect a motor vehicle liability policy for
the benefit of the person required to furnish proof of financial responsibility. Such
certificate must give the effective date of such motor vehicle liability policy, which date
shall be the same as the effective date of the certificate, and must designate by explicit
description or by appropriate reference all motor vehicles covered thereby, unless the
policy is an operator's policy.
2. When a certificate is filed showing that a policy or policies have been issued covering
certain described motor vehicles or a limited operator's policy but not insuring such
person when operating all other motor vehicles, the director shall designate suitable
restriction upon the driver's license of such person authorizing the operation of only
such vehicles as are covered by the certificate. It is unlawful for such person to
operate any motor vehicle not covered by such certificate. In the event a person
desires to be relieved of the foregoing restriction and to be permitted to operate any
motor vehicle, the person may have such restriction removed upon filing a certificate
showing that there has been issued to the person a motor vehicle liability policy
insuring the person against liability arising out of the use of any motor vehicle.
### § 39-16.1-10. Nonresident owner.

1. The nonresident owner of a motor vehicle not registered in this state may give proof of
financial responsibility by filing with the director a written or electronically transmitted
certificate of an insurance carrier authorized to transact business in the state in which
the motor vehicle or motor vehicles described in the certificate is registered, or if the
nonresident does not own a motor vehicle, then in the state in which the insured
resides, provided the certificate otherwise conforms to the provisions of this chapter,
and the director shall accept the same upon condition that the insurance carrier
complies with the following provisions with respect to the policies so certified:
a. The insurance carrier shall execute a power of attorney authorizing the director to
accept service on its behalf of notice or process in any action arising out of a
motor vehicle accident in this state.
b. The insurance carrier shall agree in writing that the policies conform with the laws
of this state relating to the terms of motor vehicle liability policies issued herein.
2. If any insurance carrier not authorized to transact business in this state, which has
qualified to furnish proof of financial responsibility, defaults in any undertaking or
agreement, the director may not thereafter accept as proof any certificate of the carrier
whether filed up to that time or thereafter tendered as proof, so long as the default
continues.
3. Notwithstanding the requirement of subsection 1, the nonresident owner of a motor
vehicle not registered in this state may file proof of future financial responsibility of an
insurance company or other state-authorized entity providing insurance and authorized
or licensed to do business in the nonresident's state of residence as long as such
proof of future financial responsibility is in the amounts required by this state.
### § 39-16.1-11. Motor vehicle liability policy.

1. A "motor vehicle liability policy" as said term is used in this chapter means an owner's
or an operator's policy of liability insurance, certified as provided in sections
otherwise provided in section 39-16.1-10, by an insurance carrier duly authorized to
transact business in this state, to or for the benefit of the person named therein as
insured.
2. Such owner's policy of liability insurance:

a. Must designate by explicit description or by appropriate reference all motor
vehicles with respect to which coverage is thereby to be granted; and
b. Must insure the person named therein and any other person, as insured, using
such motor vehicle or motor vehicles with the express or implied permission of
such named insured, against loss from the liability imposed by law for damages
arising out of the ownership, maintenance, or use of such motor vehicles within
the United States of America or the Dominion of Canada, subject to limits
exclusive of interest and costs, with respect to each such motor vehicle, as
follows: twenty-five thousand dollars because of bodily injury to or death of one
person in any one accident and subject to said limit for one person, fifty thousand
dollars because of bodily injury to or death of two or more persons in any one
accident, and twenty-five thousand dollars because of injury to or destruction of
property of others in any one accident.
3. Such operator's policy of liability insurance must insure the person named as insured
therein against loss from the liability imposed upon the person by law for damages
arising out of the use by the person of any motor vehicle, either unlimited, or limited by
excluding certain classes or types of motor vehicles, within the same territorial limits
and subject to the same limits of liability as are set forth above with respect to an
owner's policy of liability insurance.
4. Such motor vehicle liability policy must state the name and address of the named
insured, the coverage afforded by the policy, the premium charged therefor, the policy
period and the limits of liability, and must contain an agreement or be endorsed that
insurance is provided thereunder in accordance with the coverage defined in this
chapter as respects bodily injury and death or property damage, or both, and is subject
to all the provisions of this chapter.
5. Such motor vehicle liability policy need not insure any liability under any workforce
safety and insurance law nor any liability on account of bodily injury to or death of an
employee of the insured while engaged in the employment, other than domestic, of the
insured, or while engaged in the operation, maintenance, or repair of any such motor
vehicle nor any liability for damage to property owned by, rented to, in charge of, or
transported by the insured.
6. Every motor vehicle liability policy is subject to the following provisions, which need not
be contained in the policy:
a. The liability of the insurance carrier with respect to the insurance required by this
chapter becomes absolute if injury or damage covered by the motor vehicle
liability policy occurs; the policy may not be canceled or annulled as to the liability
by any agreement between the insurance carrier and the insured after the
occurrence of the injury or damage; and a statement made by the insured or on
the insured's behalf and a violation of the policy do not defeat or void the policy.
This subdivision does not restrict the ability of an insurance carrier to void a motor
vehicle liability policy for which an application was made after injury or damage
occurred and does not obligate the insurance carrier to pay a claim on account of
injury or damage that occurred before the application was made.
b. The satisfaction by the insured of a judgment for injury or damage is not a
condition precedent to the right or duty of the insurance carrier to make payment
on account of the injury or damage.
c. The insurance carrier has the right to settle any claim covered by the policy, and if
the settlement is made in good faith, the amount of that settlement is deductible
from the limits of liability specified in subdivision b of subsection 2 for the accident
out of which the claim arose.
d. The policy, the written application of the policy, if any, and any rider or
endorsement that does not conflict with the provisions of this chapter constitute
the entire contract between the parties.
7. Any policy which grants the coverage required for a motor vehicle liability policy may
also grant any lawful coverage in excess of or in addition to the coverage specified for
a motor vehicle liability policy and such excess or additional coverage is not subject to

the provisions of this chapter. With respect to a policy which grants such excess or
additional coverage, the term "motor vehicle policy" applies only to that part of the
coverage which is required by this section.
8. Any motor vehicle liability policy may provide that the insured shall reimburse the
insurance carrier for any payment the insurance carrier would not have been obligated
to make under the terms of the policy except for the provisions of this chapter.
9. Any motor vehicle liability policy may provide for the prorating of the insurance
thereunder with other valid and collectible insurance.
10. The requirements for a motor vehicle liability policy may be fulfilled by the policies of
one or more insurance carriers which policies together meet such requirements.
11. Any binder issued pending the issuance of a motor vehicle liability policy must be
deemed to fulfill the requirements for such policy.
### § 39-16.1-12. Notice of cancellation of policy by insurer.

When an insurance carrier has certified a motor vehicle liability policy under sections
after cancellation or termination of the certified insurance policy by filing a notice of cancellation
or termination of the certified insurance policy; except that a policy subsequently procured and
certified shall, on the effective date of its certification, terminate the insurance previously
certified with respect to any motor vehicle designated in both certificates.
### § 39-16.1-13. Other laws requiring insurance.

1. This chapter does not apply to or affect policies of automobile insurance against
liability which may now or hereafter be required by any other law of this state, and
such policies, if they contain an agreement or are endorsed to conform to the
requirements of this chapter, may be certified as proof of financial responsibility under
this chapter.
2. This chapter may not be held to apply to or affect policies insuring solely the insured
named in the policy against liability resulting from the maintenance or use by persons
in the insured's employ or on the insured's behalf of motor vehicles not owned by the
insured.
### § 39-16.1-14. Financial responsibility may be evidenced by bond.

1. Proof of financial responsibility may be evidenced by the bond of a surety company
duly authorized to transact business within this state, or a bond with at least two
individual sureties each owning real estate not exempt from execution of a value twice
the amount of such bond, which real estate must be scheduled in the bond approved
by a judge of a court of record, and recorded in the office of the recorder of each
county in which such real estate is situated, which said bond must be conditioned for
payment of the amounts specified in section 39-16.1-02. Such bond must be filed with
the director and is not cancelable except after ten days' written notice to the director.
Such bond constitutes a lien in favor of the state upon the real estate so scheduled of
any surety, which lien exists for the benefit of any holder of a final judgment against the
person who has filed such bond, for damages, including damages for care and loss of
services, because of bodily injury to or death of any person, or for damages because
of injury to or destruction of property, including the loss of use thereof, resulting from
the ownership, maintenance, use, or operation of a motor vehicle after such bond is
recorded.
2. If such judgment rendered against the principal on such bond is not satisfied within
sixty days after it has become final, the judgment creditor may, for the judgment
creditor's own use and benefit and at the judgment creditor's sole expense, bring an
action or actions in the judgment creditor's own name against the company or persons
executing such bond, including an action or proceeding to foreclose any lien that may
exist upon the real estate of a person who has executed such bond.

### § 39-16.1-15. Deposit of cash with the Bank of North Dakota.

1. Proof of financial responsibility may be evidenced by the certificate of the Bank of
North Dakota that the person named therein has deposited with it twenty-five thousand
dollars in cash, or securities such as may legally be purchased by savings banks or for
trust funds of a market value of twenty-five thousand dollars. The Bank of North
Dakota may not accept any such deposit and issue a certificate therefor and the
director may not accept such certificate unless accompanied by evidence that there
are no unsatisfied judgments of any character against the depositor in the county
where the depositor resides.
2. Such deposit must be held by the Bank of North Dakota to satisfy, in accordance with
the provisions of this chapter, any execution on a judgment issued against such
person making the deposit for damages, including damages for care and loss of
services, because of bodily injury to or death of any person, or for damages because
of damages to or destruction of property, including the loss of use thereof, resulting
from the ownership, maintenance, use, or operation of a motor vehicle after such
deposit was made. Money or securities so deposited are not subject to attachment or
execution unless such attachment or execution arises out of a suit for damages as
aforesaid.
### § 39-16.1-16. Employment or family connection in lieu of proof of financial

responsibility.
Whenever any person required to give proof of financial responsibility hereunder is or later
becomes an operator in the employ of any owner, or is or later becomes a member of the
immediate family or household of the owner, the director shall accept proof given by such owner
in lieu of proof by such other person to permit such other person to operate a motor vehicle for
which the owner has given proof as herein provided. The director shall designate the restrictions
imposed by this section on the face of such person's license.
### § 39-16.1-17. Release of bond or deposit on making other proof of responsibility.

1. The director shall consent to the cancellation of any bond or certificate of insurance or
the director shall direct and the Bank of North Dakota shall return any money or
securities to the person entitled thereto upon the substitution and acceptance of other
adequate proof of financial responsibility pursuant to this chapter.
2. The director may not consent to the cancellation of any bond or the return of any
money or securities in the event any action for damages upon liability covered by such
proof is then pending or any judgment upon any such liability is then unsatisfied, or in
the event the person who has filed such bond or deposited such money or securities
has, within one year immediately preceding such request been involved as an operator
or owner in any motor vehicle accident resulting in injury or damage to the person or
property of others. An affidavit of the applicant as to the nonexistence of such facts, or
that the applicant has been released from all of the applicant's liability, or has been
finally adjudicated not to be liable, for such injury or damage, is sufficient evidence
thereof in the absence of evidence to the contrary in the records of the director.
### § 39-16.1-18. Procedure on failure of proof on file.

Whenever any proof of financial responsibility filed under the provisions of this chapter no
longer fulfills the purposes for which required, the director shall, for the purpose of this chapter,
require other proof as required by this chapter and shall suspend the license or the
nonresident's operating privilege upon failure to file such other proof as required.
### § 39-16.1-19. Cancellation of bond or return of deposit.

1. The director shall upon request consent to the immediate cancellation of any bond or
certificate of insurance, or the director shall direct and the Bank of North Dakota shall
return to the person entitled thereto any money or securities deposited pursuant to this

chapter as proof of financial responsibility, or the director shall waive the requirement
of filing proof, in any of the following events:
a. At any time after one year from the date such proof was required when, during
the one-year period preceding the request, the director has not received record of
a conviction or a forfeiture of bail which would require the revocation of the
license or operating privilege, or both, of the person by or for whom such proof
was furnished.
b. The death of the person on whose behalf such proof was filed or the permanent
incapacity of such person to operate a motor vehicle.
c. The surrender of the person's license to the director by the person who has given
proof.
2. The director may not consent to the cancellation of any bond or the return of any
money or securities in the event any action for damages upon a liability covered by
such proof is then pending or any judgment upon any such liability is then unsatisfied,
or in the event the person who has filed such bond or deposited such money or
securities has, within one year immediately preceding such request, been involved as
an operator or owner in any motor vehicle accident resulting in injury or damage to the
person or property of others. An affidavit of the applicant as to the nonexistence of
such facts, or that the applicant has been released from all of the applicant's liability, or
has been finally adjudicated not to be liable, for such injury or damage, is sufficient
evidence thereof in the absence of evidence to the contrary in the records of the
director.
3. Whenever any person whose proof has been canceled or returned under subdivision c
of subsection 1 applies for a license within a period of one year from the date proof
was originally required, the application must be refused. The person's operator's
license and driving privileges remain under suspension or revocation until the
applicant re-establishes proof for the remainder of the one-year period.
### § 39-16.1-20. Seizure or return of operator's license.

Repealed by S.L. 2007, ch. 325, § 7.
### § 39-16.1-20.1. Verification of liability insurance.

No operator's license may be returned to an individual unless that person files with the
director a verified statement confirming the person's insurance coverages as required by section
### § 39-08-20. The verified statement must include the name of the insurance carrier and the

effective dates of the policy. Upon the request of the director, the insurance carrier will verify the
information contained in the verified statement. The director shall suspend the operator's license
of any person upon receiving satisfactory evidence that the verified statement contains false or
fraudulent information. The period of suspension may not exceed six months. Any suspension
must be initiated under section 39-06-33. An operator whose license is suspended under this
section is not eligible for a temporary operator's permit.
### § 39-16.1-21. Operating under suspension or revocation - Penalties.

Repealed by S.L. 2005, ch. 330, § 8.
### § 39-16.1-22. Federal, state, or municipal ownership.

This chapter does not apply with respect to any motor vehicle owned and operated by the
United States, this state, or any political subdivision of this state or any municipality therein.
### § 39-16.1-23. Who may be self-insurer.

1. Any person in whose name more than twenty-five motor vehicles are registered may
qualify as a self-insurer by obtaining a certificate of self-insurance issued by the
director as provided in subsection 2.

2. The director may, upon the application of any person, issue a certificate of
self-insurance when the director is satisfied that such person is possessed and will
continue to be possessed of ability to pay any judgment obtained against the person.
3. Upon not less than five days' notice and a hearing pursuant to such notice, the director
may cancel a certificate of self-insurance if the director is satisfied that such person is
not possessed or will not continue to be possessed of ability to pay any judgment
obtained against the person. Failure to pay any judgment within thirty days after such
judgment has become final constitutes a reasonable ground for the cancellation of a
certificate of self-insurance.
