# Title 26.1 — Insurance

## Chapter 26.1-04 — Prohibited Practices in Insurance Business

### § 26.1-04-01. Limitation on right to engage in trade.

An insurance company organized under this title may not deal or trade, directly or indirectly,
in the buying or selling of any goods, wares, merchandise, or other commodities whatsoever,
except such as may have been insured by the company and are claimed to be damaged by
reason of the risk insured against or as allowed under this chapter.
### § 26.1-04-02. Unfair methods of competition or unfair and deceptive acts or practices

prohibited.
A person may not engage in this state in any trade practice defined in this chapter as, or
determined pursuant to this chapter to be, an unfair method of competition or an unfair or
deceptive act or practice in the business of insurance.
### § 26.1-04-03. Unfair methods of competition and unfair or deceptive acts or practices

defined.
The following are unfair methods of competition and unfair and deceptive acts or practices
in the business of insurance:
1. Misrepresentations and false advertising of policy contracts. Making, issuing,
circulating, or causing to be made, issued, or circulated, any estimate, illustration,
circular, statement, sales presentation, omission, or comparison misrepresenting the
terms of any policy issued or to be issued or the benefits or advantages promised
thereby or the dividends or share of the surplus to be received thereon, or making any
false or misleading statements as to the dividends or share of surplus previously paid
on any insurance policies, or making any misleading representation or any
misrepresentation as to the financial condition of any person, or as to the legal reserve
system upon which any life insurance company operates, or using any name or title of
any policy or class of policies misrepresenting the true nature thereof, or making any
misrepresentation tending to induce the lapse, forfeiture, exchange, conversion, or
surrender of any insurance policy or for the purpose of effecting a pledge or
assignment of or effecting a loan against any insurance.
2. False information and advertising generally. Making, publishing, disseminating,
circulating, or placing before the public, or causing, directly or indirectly, to be made,
published, disseminated, circulated, or placed before the public, in a newspaper,
magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or
poster, or over any radio station, or in any other way, an advertisement,
announcement, or statement containing any assertion, representation, or statement
with respect to the business of insurance or with respect to any person in the conduct
of that person's insurance business, which is untrue, deceptive, or misleading.
3. Defamation. Making, publishing, disseminating, or circulating, directly or indirectly, or
aiding, abetting, or encouraging the making, publishing, disseminating, or circulating of
any oral or written statement or any pamphlet, circular, article, or literature which is
false, or maliciously critical of or derogatory to the financial condition of any person,
and which is calculated to injure any person engaged in the business of insurance.
4. Boycott, coercion, and intimidation. Entering into any agreement to commit, or by any
concerted action committing, any act of boycott, coercion, or intimidation resulting in or
tending to result in unreasonable restraint of, or monopoly in, the business of
insurance.
5. False financial statements. Filing with any supervisory or other public official, or
making, publishing, disseminating, circulating, or delivering to any person, or placing
before the public, or causing directly or indirectly, to be made, published,
disseminated, circulated, delivered to any person, or placed before the public, any
false statement of financial condition of any person with intent to deceive.

Making any false entry in any book, report, or statement of any person with intent
to deceive any agent or examiner lawfully appointed to examine into its condition or
into any of its affairs, or any public official to whom the person is required by law to
report, or who has authority by law to examine into its condition or into any of its
affairs, or, with like intent, willfully omitting to make a true entry of any material fact
pertaining to the business of the person in any book, report, or statement of the
person.
6. Stock operations and advisory board contracts. Issuing or delivering or permitting
agents, officers, or employees to issue or deliver, agency company stock or other
capital stock, or benefit certificates or shares in any common-law corporation, or
securities or any special or advisory board contracts or other contracts of any kind
promising returns and profits as an inducement to insurance.
7. Unfair discrimination.
a. Making or permitting any unfair discrimination between individuals of the same
class and equal expectation of life in the rates charged for any contract of life
insurance or of life annuity or in the dividends or other benefits payable thereon,
or in any other of the terms and conditions of such contract.
b. Making or permitting any unfair discrimination, including consideration of an
individual's history or status as a subject of domestic abuse, between individuals
of the same class and of essentially the same hazard in the amount of premium,
policy fees, or rates charged for any policy or contract of accident or health
insurance or in the benefits payable thereunder, or in any of the terms or
conditions of such contract, or in any other manner whatsoever.
c. Refusing to insure, or refusing to continue to insure, or limiting the amount,
extent, or kind of life insurance, accident and sickness insurance, health services,
or health care protection insurance available to an individual, or charging an
individual a different rate for the same coverage solely because of blindness or
partial blindness. Refusal to insure includes denial by an insurer of disability
insurance coverage on the grounds that the policy defines "disability" as being
presumed in the event that the insured loses the insured's eyesight; however, an
insurer may exclude from coverage disabilities consisting solely of blindness or
partial blindness when such condition existed at the time the policy was issued.
With respect to all other conditions, including the underlying cause of the
blindness or partial blindness, persons who are blind or partially blind shall be
subject to the same standards of sound actuarial principles or actual or
reasonably anticipated experience as are sighted persons.
d. Making or permitting any unfair discrimination between individuals or risks of the
same class and of essentially the same hazard by refusing to insure, refusing to
renew, canceling, or limiting the amount of insurance coverage on a property or
casualty risk solely because of the geographic location of the risk, unless the
action is the result of the application of sound underwriting and actuarial
principles related to actual or reasonably anticipated loss experience.
e. Refusing to insure or charging a different rate solely in consideration of the risk's
environmental, social, and governance criteria; diversity, equity, and inclusion
policies; or political and ideological factors, unless the refusal or different rate is
the result of the application of sound underwriting and actuarial principles related
to actual or reasonably anticipated loss experience.
8. Rebates.
a. Except as otherwise expressly provided by law, knowingly permitting or offering to
make or making any contract of life insurance, life annuity, or accident and health
insurance, or agreement as to such contract other than as plainly expressed in
the contract issued thereon, or paying or allowing, or giving or offering to pay,
allow, or give, directly or indirectly, as inducement to the insurance or annuity any
rebate of premiums payable on the contract, or any special favor or advantage in
the dividends or other benefits thereon, or any valuable consideration or
inducement whatsoever not specified in the contract; or giving, selling, or

purchasing, or offering to give, sell, or purchase as inducement to the insurance
or annuity or in connection therewith, any stocks, bonds, or other securities of any
insurance company or other corporation, association, or partnership, or any
dividends or profits accrued thereon, or anything of value whatsoever not
specified in the contract.
b. Subsection 7 or subdivision a of this subsection do not prohibit the following
practices:
(1) In the case of any contract of life insurance or life annuity, paying bonuses
to policyholders or otherwise abating their premiums in whole or in part out
of surplus accumulated from nonparticipating insurance, provided that any
such bonuses or abatement of premiums are fair and equitable to
policyholders and for the best interests of the company and its
policyholders;
(2) In the case of life insurance policies issued on the industrial debit plan,
making allowance to policyholders who have continuously for a specified
period made premium payments directly to an office of the insurer in an
amount which fairly represents the saving in collection expenses; and
(3) Readjusting the rate of premium for a group insurance policy based on the
loss or expense experience thereunder, at the end of the first or any
subsequent policy year of insurance thereunder, which may be made
retroactive only for the policy year.
c. Notwithstanding any other provision in this subsection, if the cost does not
exceed an aggregate retail value of one hundred dollars per person per year, an
insurance producer may give a gift, prize, promotional article, logo merchandise,
meal, or entertainment activity directly or indirectly to a person in connection with
marketing, promoting, or advertising the business. As used in this subdivision,
"person" means the named insured, policy owner, or prospective client or the
spouse of any of these individuals, but the term does not include a certificate
holder, child, or employee of the named insured, policy owner, or prospective
client. Subject to the limits of this subdivision, an insurance producer may give a
gift card for specific merchandise or services such as a meal, gasoline, or car
wash but may not give cash, a cash card, any form of currency, or any refund or
discount in premium. An insurance producer may not condition the giving of a gift,
prize, promotion article, logo merchandise, meal, or entertainment activity on
obtaining a quote or a contract of insurance. Notwithstanding the limitation in this
subdivision, an insurance producer may conduct raffles or drawings, if there is no
financial cost to an entrant to participate, the drawing or raffle does not obligate a
participant to purchase insurance, the prizes are not valued in excess of a
reasonable amount determined by the commissioner, and the drawing or raffle is
open to the public. The raffle or drawing must be offered in a manner that is not
unfairly discriminatory and may not be contingent on the purchase, continued
purchase, or renewal of a policy. Notwithstanding the limitation in this subdivision,
an insurance producer may make a donation to a nonprofit organization that is
exempt from federal taxation under Internal Revenue Code section 501(c)(3)
[26 U.S.C. 501(c)(3)] in any amount as long as the donation is not given as an
inducement to obtain a contract of insurance.
d. The provisions in this subsection may not be construed as including within the
definition of discrimination or rebates any of the following practices:
(1) The offer or provision by an insurer or producer, by or through an employee,
an affiliate, or a third-party representative, of value-added products or
services at no or reduced cost if such products or services are not specified
in the policy of insurance if the product or service:
(a) Relates to the insurance coverage and is designed to satisfy one or
more of the following:
[1] Provide loss mitigation or loss control;
[2] Reduce claims costs or claim settlement costs;

[3] Provide education about liability risk or risk of loss to persons or
property;
[4] Monitor or assess risk, identify sources of risk, or develop
strategies for eliminating or reducing risk;
[5] Enhance health;
[6] Enhance financial wellness through items such as education of
financial planning services;
[7] Provide post-loss services;
[8] Incent behavioral changes to improve the health or reduce the
risk of death or disability of an individual defined as policyholder,
potential policyholder, certificate holder, potential certificate
holder, insured, potential insured, or applicant; or
[9] Assist in the administration of the employee or retiree benefit
insurance coverage.
(b) If offered by the insurer or producer, the insurer or producer, upon
request, shall ensure the person is provided with contact information
to assist the person with questions regarding the product or service.
(c) Is based on documented objective criteria and offered in a manner not
unfairly discriminatory. The documented criteria must be maintained
by the insurer or producer and produced at the request of the
commissioner.
(d) Is reasonable in comparison to that person's premiums or insurance
coverage for the policy class.
(2) If an insurer or producer does not have sufficient evidence, but has a good-
faith belief the product or service meets the criteria in paragraph 1 of
subdivision d of subsection 8, the insurer or producer may provide the
product or service in a manner that is not unfairly discriminatory as part of a
pilot or testing program for no longer than one year. An insurer or producer
shall notify the department of the pilot or testing program offered to
consumers in this state before launching and may proceed with the program
unless the department objects within twenty-one days of notice.
e. An insurer, producer, or representative of an insurer or producer may not offer or
provide insurance as an inducement to the purchase of another policy or
otherwise use of the words "free" or "no cost" or words of similar import in an
advertisement.
f. The commissioner may adopt regulations when implementing the permitted
practices set forth in this subsection to ensure consumer protection. Consistent
with applicable law, the topics addressed by the regulations may include
consumer data protections and privacy, consumer disclosure, and unfair
discrimination.
9. Unfair claim settlement practices. Committing any of the following acts, if done without
just cause and if performed with a frequency indicating a general business practice:
a. Knowingly misrepresenting to claimants pertinent facts or policy provisions
relating to coverages at issue.
b. Failing to acknowledge with reasonable promptness pertinent communications
with respect to claims arising under insurance policies.
c. Failing to adopt and implement reasonable standards for the prompt investigation
of claims arising under insurance policies.
d. Not attempting in good faith to effectuate prompt, fair, and equitable settlements
of claims submitted in which liability has become reasonably clear.
e. Compelling insureds to institute suits to recover amounts due under its policies by
offering substantially less than the amounts ultimately recovered in suits brought
by them when the insureds have made claims for amounts reasonably similar to
the amounts ultimately recovered.

f. Making known to insureds or claimants a policy of appealing from arbitration
awards in favor of insureds or claimants for the purpose of compelling them to
accept settlements or compromises less than the amount awarded in arbitration.
g. Attempting settlement or compromise of claims on the basis of applications which
were altered without notice to, or knowledge or consent of, insureds.
h. Attempting to settle a claim for less than the amount to which a reasonable
person would have believed one was entitled by reference to written or printed
advertising material accompanying or made a part of an application.
i. Attempting to delay the investigation or payment of claims by requiring an insured
and the insured's physician to submit a preliminary claim report and then
requiring the subsequent submission of formal proof of loss forms, both of which
submissions contain substantially the same information.
j. Failing to affirm or deny coverage of claims within a reasonable time after proof of
loss has been completed.
k. Refusing payment of claims solely on the basis of the insured's request to do so
without making an independent evaluation of the insured's liability based upon all
available information.
l. Providing coverage under a policy issued under chapter 26.1-45 or 26.1-36.1 for
confinement to a nursing home and refusing to pay a claim when a person is
covered by such a policy and the person's physician ordered confinement
pursuant to the terms of the policy for care other than custodial care. Custodial
care means care which is primarily for the purpose of meeting personal needs
without supervision by a registered nurse or a licensed practical nurse.
m. Failure to use the standard health insurance proof of loss and claim form or
failure to pay a health insurance claim as required by section 26.1-36-37.1.
It is not a prohibited practice for a health insurance company with participating provider
agreements to require that a subscriber or member using a nonparticipating provider
be responsible for providing the insurer a copy of medical records used for claims
processing.
10. Unfair handling of communications by insurance company. Failing to adopt and
implement reasonable standards for the prompt handling of written communications,
primarily expressing grievances, received by the insurance company from insureds or
claimants.
11. Refusing to insure risks. Refusing to insure risks solely because of race, color, creed,
sex, or national origin, or refusing to continue to insure risks solely because an
employer chooses to offer a health maintenance organization option to employees in
its health benefit plan.
12. Misrepresentation in insurance applications. Making false or fraudulent statements or
representations on or relative to an application for an insurance policy, for the purpose
of obtaining a fee, commission, money, or other benefit from any insurer, insurance
producer, or individual.
13. Failure to refund unearned premiums. Failing to refund within thirty days of the
cancellation of an insured's policy the unearned premium paid for that insurance
policy. However, for commercial lines of insurance policies which are audited by the
insurer to determine premium, the refund of premium must be made within thirty days
from the date the insurer receives from the insured that information which is
reasonably necessary for the insurer to audit the insured's business to determine the
premium due to the insurer.
14. As used in subsections 15, 16, 17, 18, and 19, unless the context otherwise requires:
a. "Entity" includes a third-party administrator, an insurance company as defined in
section 26.1-02-01, a health maintenance organization, or any other entity
providing a plan of health insurance subject to state insurance regulation.
b. "Health care provider" means a person that delivers, administers, or supervises
health care products or services, for profit or otherwise, in the ordinary course of
business or professional practice.

c. "Health plan" means any public or private plan or arrangement that provides or
pays the cost of health benefits, including any organization of health care
providers that furnishes health services under a contract or agreement with this
type of plan.
d. "Medical communication" means any communication, other than a knowing and
willful misrepresentation, made by a health care provider to a patient regarding
the health care needs or treatment options of the patient and the applicability of
the health plan to the patient's needs or treatment. The term includes
communications concerning:
(1) Tests, consultations, and treatment options;
(2) Risks or benefits associated with tests, consultations, and options;
(3) Variation in experience, quality, or outcome among any health care
providers or health care facilities providing any medical service;
(4) The process, basis, or standard used by an entity to determine whether to
authorize or deny health care services or benefits; and
(5) Financial incentives or disincentives based on service utilization provided by
an entity to a health care provider.
e. "Patient" includes a former, current, or prospective patient or the guardian or legal
representative of any former, current, or prospective patient.
15. a. Interference with certain medical communications. An entity offering a health plan
may not restrict or interfere with any medical communication and may not take
any of the following actions against a health care provider solely on the basis of a
medical communication:
(1) Refusal to contract with the health care provider;
(2) Termination of or refusal to renew a contract with the health care provider;
(3) Refusal to refer patients to or allow others to refer patients to the health care
provider; or
(4) Refusal to compensate the health care provider for covered services that
are medically necessary.
b. This subsection does not prohibit an entity from enforcing, as part of a contract or
agreement to which a health care provider is a party, any mutually agreed-upon
terms and conditions, including terms and conditions requiring a health care
provider to participate in and cooperate with all programs, policies, and
procedures developed or operated by a health plan to assure, review, or improve
the quality and effective utilization of health care services, if the utilization is
according to guidelines or protocols that are based on clinical or scientific
evidence and only if the guidelines or protocols under the utilization do not
prohibit or restrict medical communications between providers and their patients.
16. Unfair indemnification. A contract between an entity and a health care provider may
not require the health care provider to indemnify the entity for the entity's negligence,
willful misconduct, or breach of contract, and may not require a health care provider as
a condition of participation to waive any right to seek legal redress against the entity. In
addition to the proceedings and penalties provided in this chapter, a contract provision
violating this subsection is void.
17. Incentives to withhold medically necessary care. An entity may not offer a health care
provider, and a contract with a health care provider under a health plan may not
contain, an incentive plan that includes a specific payment made to, or withheld from,
the provider as an inducement to deny, reduce, limit, or delay medically necessary
care covered by the health plan and provided with respect to a patient. This subsection
does not prohibit incentive plans, including capitation payments or shared-risk
arrangements, that are not tied to specific medical decisions with respect to a patient.
In addition to the proceedings and penalties provided in this chapter, a contract
provision violating this subsection is void. As used in this subsection, "medically
necessary care" means health care services, supplies, or treatments that a reasonably
prudent physician or other health care provider would provide to a patient for the
prevention, diagnosis, or treatment of illness, injury, disease, or its symptoms which

are in accordance with generally accepted standards of medical practice, clinically
appropriate in terms of type, frequency, extent, site, and duration, and not primarily for
the convenience of the patient, physician, or other health care provider. This definition
does not preclude an entity from establishing a definition of "medically necessary care"
for determining which services are covered by the health plan.
18. Retaliation for patient advocacy. An entity may not take any of the following actions
against a health care provider solely because the provider, in good faith, reports to
state or federal authorities an act or practice by the entity that jeopardizes patient
health or welfare, or advocates on behalf of a patient in a utilization review program or
grievance procedure:
a. Refusal to contract with the health care provider;
b. Termination of or refusal to renew a contract with the health care provider;
c. Refusal to refer patients to or allow others to refer patients to the health care
provider; or
d. Refusal to compensate the health care provider for covered services that are
medically necessary.
19. Unfair reimbursement. An entity may not require that a health care provider receive
under a health plan, pursuant to policies of the entity or a contract with the health care
provider, the lowest payment for services and items that the health care provider
charges or receives from any other entity. In addition to the proceedings and penalties
provided in this chapter, a contract provision violating this subsection is void.
20. Unfair referral. An insurer, insurance producer, or third-party administrator referring an
individual employee to the association, or arranging for an individual employee to
apply to the association for the purpose of separating that employee from group health
insurance coverage provided in connection with the employee's employment.
21. Unfair compensation. Basing the compensation, including performance bonuses or
incentives, of claims employees or contracted claims personnel on the following:
a. The number of policies canceled.
b. The number of times coverage is denied.
c. Use of a quota limiting or restricting the number or volume of claims.
d. Use of an arbitrary quota or cap limiting or restricting the amount of claims
payments without due consideration to the merits of the claim.
### § 26.1-04-04. Coercing purchaser or borrower to insure with particular company or

insurance producer prohibited.
1. No person, engaged in selling property or in the business of financing the purchase of
property or of lending money on the security of property and no trustee, director,
officer, agent, or other employee of the person may require, as a condition precedent,
concurrent, or subsequent to the sale or financing the purchase of the property or to
lending money upon the security of a mortgage thereon or for the renewal or extension
of any such loan or mortgage or for the performance of any other act in connection
therewith, that the person purchasing the property or for whom the purchase is to be
financed or to whom the money is to be loaned or for whom the extension, renewal, or
other act is to be granted, or performed, negotiate any insurance policy or renewal
thereof covering the property through a particular insurance company or insurance
producer.
2. This section does not prevent the exercise by any person of the right to designate
reasonable financial requirements as to the insurance company, the terms and
provisions of the policy, and the adequacy of the coverage with respect to insurance
on property pledged or mortgaged to the person; nor does this section prohibit the
right of any person from voluntarily negotiating or soliciting the placing of such
insurance; nor does this section forbid the securing of insurance or renewal thereof at
the request of the purchaser or borrower or because of the failure of the purchaser or
borrower to furnish the necessary insurance or renewal thereof.
3. Violation of this section constitutes an unfair insurance practice. The person violating
this section must be proceeded against under this chapter.

### § 26.1-04-05. Discrimination by life insurance companies and rebates and inducements

by insurance producers prohibited.
A life insurance company doing business in this state may not make or permit any
distinction or discrimination between insureds of the same class and with equal expectation of
life in the amount or payment of premiums or rate charges for policies of life or endowment
insurance, or in the dividends or other benefits payable thereon, or in any other of the terms or
conditions of the contracts which it makes. No life insurance company, and no insurance
producer therefor, either personally or by any other person, may:
1. Make any insurance contract, or agreement with reference thereto, other than such as
is expressed plainly in the policy issued thereon.
2. Offer, promise, allow, give, set off, or pay any rebate of the whole or any part of the
premium payable on the policy or the insurance producer's commission thereon, or
any special favor or advantage in the dividends, earnings, profits, or other benefit
founded, arising, accruing, or to accrue thereon or therefrom.
3. Offer, promise, allow, or give any special advantage in the date of the policy or the age
at which the same is issued.
4. Offer, promise, allow, or give any paid employment or contract for services of any kind,
or any other valuable inducement or consideration whatsoever not specified in the
insurance policy or contract.
5. Offer, promise, give, option, sell, or purchase, or offer to give, sell, or purchase, as
inducement to insurance or in connection therewith, any stocks, bonds, securities, or
property, or any dividends or profits accruing or to accrue thereon, or other thing of
value whatsoever not specified in the policy.
This section does not prevent the taking of a bona fide obligation, with legal interest, in payment
of any premium.
### § 26.1-04-05.1. Visual acuity prohibited as factor in life or accident and sickness

contracts.
No insurance company, benevolent society, nonprofit health service corporation, or health
maintenance organization may issue any policy, certificate, or contract on life, accident and
sickness, health services, or health care protection for which visual acuity is used as a criteria
for accepting or rejecting risks or for setting of rates charged for that coverage.
### § 26.1-04-06. Insured persons and applicants for insurance prohibited from accepting

rebates - Exception.
1. An insurance producer or agent of any insurance or surety company, reciprocal,
benevolent society, or any other insurance organization or association, however
constituted or entitled, may not grant, and an insured person or party or applicant for
insurance, either directly or indirectly, may not receive or accept, or agree to receive or
accept, any rebate of premium or of any part thereof, or all or any part of any
insurance producer's commission thereon, or any favor or advantage, or any share in
any benefit to accrue under any insurance policy, or any other valuable consideration
or inducement other than such as may be specified in the policy, except as provided in
an applicable filing which is in effect under the provisions of the laws regulating
insurance rates or except as provided under subsection 2.
2. Notwithstanding any other provision in this section, if the cost does not exceed an
aggregate retail value of one hundred dollars per person per year, an insurance
producer may give a gift, prize, promotional article, logo merchandise, meal, or
entertainment activity directly or indirectly to a person in connection with marketing,
promoting, or advertising the business. As used in this subsection, "person" means the
named insured, policy owner, or prospective client or the spouse of any of these
individuals, but the term does not include a certificate holder, child, or employee of the
named insured, policy owner, or prospective client. Subject to the limits of this
subsection, an insurance producer may give a gift card for specific merchandise or
services such as a meal, gasoline, or car wash but may not give cash, a cash card,
any form of currency, or any refund or discount in premium. An insurance producer

may not condition the giving of a gift, prize, promotional article, logo merchandise,
meal, or entertainment activity on obtaining a quote or a contract of insurance.
Notwithstanding the limitation in this subsection, an insurance producer may make a
donation to a nonprofit organization that is exempt from federal taxation under Internal
Revenue Code section 501(c)(3) [26 U.S.C. 501(c)(3)] in any amount as long as the
donation is not given as an inducement to obtain a contract of insurance.
### § 26.1-04-07. Misrepresentation of terms of policy and future dividends prohibited.

An insurance or surety company, reciprocal, benevolent society, or any other insurance
organization or association, however constituted or entitled, doing business in this state, and an
officer, director, agent, or solicitor of the company, society, or organization, and an insurance
producer, may not issue, circulate, or use, or cause or permit to be issued, circulated, or used,
any written or oral statement or circular misrepresenting the terms of any policy issued or to be
issued by the company, society, or organization, or the benefits or advantages, promised
thereby, or make an estimate, with intent to deceive, of the future dividends or shares of surplus
payable under the policy, or use any name or title of any policy or class of policies
misrepresenting the true nature thereof.
### § 26.1-04-08. Rulemaking.

The commissioner may adopt reasonable rules necessary to identify specific methods of
competition and acts or practices prohibited by section 26.1-04-03. The rules may not enlarge
upon nor extend the provisions of section 26.1-04-03.
### § 26.1-04-09. Authority of commissioner.

The commissioner may examine and investigate the affairs of every person engaged in the
business of insurance in this state to determine whether the person has been or is engaged in
any unfair method of competition or in any unfair or deceptive act or practice prohibited by
section 26.1-04-02.
### § 26.1-04-10. State's attorney to prosecute for discrimination or misrepresentation.

Upon evidence satisfactory to the commissioner that section 26.1-04-05, 26.1-04-06,
26.1-04-07, or 26.1-04-17 has been violated by any person, the commissioner shall certify to the
state's attorney of the county in which the violation occurred all evidence of the violation in the
commissioner's possession, and the state's attorney shall prosecute the case.
### § 26.1-04-11. Immunity from prosecution.

If any person asks to be excused from attending and testifying or from producing any
evidence at any trial or hearing on the ground that the testimony or evidence required may tend
to incriminate that person or subject that person to a penalty or forfeiture, but is directed to give
the testimony or produce the evidence, that person shall comply with the direction; but no
testimony or evidence compelled from an individual after a valid claim of the privilege against
self-incrimination has been made may be used against the individual in any criminal proceeding,
or in any proceeding to subject the individual to a penalty or forfeiture. However, no individual so
testifying is exempt from prosecution or punishment for any perjury or false statements
committed while testifying and the testimony or evidence given or produced is admissible upon
any criminal action, investigation, or proceeding concerning the perjury or false statements, nor
is the individual exempt from the refusal, revocation, or suspension of any license, permission,
or authority conferred, or to be conferred, pursuant to the insurance laws of this state.
### § 26.1-04-12. Hearing.

Whenever the commissioner has reason to believe that any person has been engaged or is
engaging in this state in any unfair method of competition or any unfair or deceptive act or
practice defined in section 26.1-04-03, and that a proceeding would be to the interest of the
public, the commissioner shall conduct a hearing.

### § 26.1-04-13. Orders and modifications.

1. If, after hearing, the commissioner determines that the person charged has engaged in
an unfair method of competition or an unfair or deceptive act or practice, the
commissioner shall order the person to cease and desist from engaging in the method
of competition, act, or practice. If the person charged is found to have willfully engaged
in a method of competition, act, or practice in violation of section 26.1-04-03, the
commissioner may order any one or more of the following:
a. Payment of a monetary penalty of not more than one thousand dollars for each
and every act or violation but not to exceed an aggregate penalty of ten thousand
dollars unless the person knew or reasonably should have known that person
was in violation of section 26.1-04-03, in which case the penalty must be not
more than five thousand dollars for each and every act or violation but not to
exceed an aggregate penalty of fifty thousand dollars in any six-month period.
b. Suspension or revocation of the person's license if the person knew or
reasonably should have known that person was in violation of section 26.1-04-03.
2. Until the expiration of the time allowed for an appeal if no appeal has been duly filed
or, if an appeal has been filed, then until the transcript of the record in the proceeding
has been filed in the district court, the commissioner may modify or set aside in whole
or in part any order issued under this section.
3. After the expiration of the time allowed for filing an appeal if no appeal has been duly
filed, the commissioner may, after notice and opportunity for hearing, reopen and alter,
modify, or set aside, in whole or in part, any order issued under this section, whenever
in the commissioner's opinion conditions of fact or of law have so changed as to
require the action or if the public interest shall so require.
### § 26.1-04-14. Penalty.

Any person who violates a cease and desist order of the commissioner under section
26.1-04-13, after it has become final, and while it is in effect, shall, upon proof thereof to the
satisfaction of the court, forfeit and pay to the state of North Dakota a sum not to exceed a
monetary penalty of not more than ten thousand dollars for each and every act or violation.
### § 26.1-04-15. Judicial review by intervenor.

If the commissioner does not charge a violation of this chapter, then any intervenor in the
proceedings may within ten days after the service of the report, cause a notice of appeal to be
filed in the district court of Burleigh County for a review of the report. The court may issue
appropriate orders and decrees in connection therewith, including, if the court finds that it is to
the interest of the public, orders enjoining and restraining the continuance of any method of
competition, act, or practice which it finds, notwithstanding the report of the commissioner,
violates this chapter.
### § 26.1-04-16. Penalty for violating provisions relating to misrepresentation and

discrimination.
Any officer, agent, insurance producer, or representative of any insurance or surety
company, reciprocal, benevolent society, or any other insurance organization, or association, or
any other person, who violates section 26.1-04-05, 26.1-04-06, 26.1-04-07, or 26.1-04-17 is
guilty of a class A misdemeanor. The commissioner may, after a hearing upon fifteen days'
notice, revoke the license to transact business in this state of any insurance organization
violating section 26.1-04-05 or 26.1-04-06.
### § 26.1-04-17. Revocation or suspension of insurance producer's license for

misrepresentation or discrimination.
Upon satisfactory evidence of the violation of any provision of this chapter relating to
misrepresentation or discrimination by any insurance producer of any insurance or surety
company, reciprocal, benevolent society, or any other insurance organization or association,

however constituted or entitled, the commissioner may suspend or revoke the license of the
offending insurance producer.
### § 26.1-04-18. Order does not relieve from other liability.

An order of the commissioner under this chapter or order of a court affirming the
commissioner's order does not relieve or absolve any person affected by the order from any
liability under any other law of this state.
### § 26.1-04-19. Chapter additional to existing law.

The powers vested in the commissioner by this chapter are additional to any other powers
to enforce any penalties, fines, or forfeitures authorized by law with respect to the methods,
acts, and practices declared to be unfair or deceptive by this chapter.
