The State of Insurance in N.D.

In recent years, you may have noticed headlines related to the insurance industry, and, more importantly, you may have experienced its effects firsthand. This could include higher premiums that strain your household budget, reduced availability of certain coverage options, or delays in claim processing after a loss. We've witnessed how natural disasters, such as the devastating fires in Western North Dakota and Southern California, can impact communities. Furthermore, high-profile incidents, like the tragic murder of an insurance executive in New York, have highlighted the human toll and complexities faced by the industry.

While national issues often seem distant in North Dakota, they still affect us. Our state has faced severe weather events that have caused significant losses for many families, emphasizing the need for adequate insurance coverage and responsive providers. However, insurers have an obligation to provide benefits on claims you are entitled to.

As your insurance commissioner, my responsibility is to find a balance between the need for affordable premiums and ensuring that insurance companies have sufficient funds to pay claims when disaster strikes. It’s a tall order, especially when national trends indicate that for every dollar in premiums collected by a property insurance company, approximately $1.10 is paid out in claims. While it may be challenging to feel sympathy for insurance companies, it's important to recognize that companies are on an unsustainable path.

North Dakota's insurance market remains stable, but we are not immune from external pressures. Rising healthcare costs continue to drive up health insurance premiums, straining families and employers. Inflation, labor shortages and supply chain disruptions have increased the costs of property repairs and rebuilding, leading to higher premiums for homeowners and businesses alike. The underlying fact remains true: if the underlying thing you are insuring costs more, then the insurance supporting those goods and services will also cost more. To address these challenges head-on, my office, in conjunction with our legislature, undertook a proactive study to evaluate the state's property insurance laws and regulations, in 2024. Based on the results of that study, we will work with the legislature this session to modernize our laws to make it easier for insurance companies to innovate while keeping consumer protections intact.

Insurance is a foundational part of our lives; it protects our homes, cars and livelihoods; it allows the risk-takers among us to take risks and drive our economy forward. As we move into 2025, I encourage all North Dakotans to take a proactive approach. Review your policies, discuss the needs with your trusted insurance agent and ensure you are prepared.

The road ahead won't be without challenges, but by continuing to work together, we can build a more resilient, responsive and robust insurance market that serves the people of North Dakota.