The Senate Industry and Business Committee voted unanimously to give a do‑pass recommendation on Senate Bill 23‑74 after adopting a package of amendments that address rebating rules, crop insurance, supplemental claim time limits and arbitration for surplus lines.

Johannes Palsgraf, general counsel for the North Dakota Insurance Department, walked the committee through the department’s proposed amendments and the industry‑negotiated language. Palsgraf said the department removed sections over NAIC accreditation concerns, carved federal crop insurance out of rebating rules, and worked with industry to shorten the supplemental claim reopening window to 12 months (down from an originally proposed 18 months).

John Godfrey, North Dakota Insurance Commissioner, said the bill is intended to ‘‘improve North Dakota’s market’’ and described three implementation options the committee could adopt: (1) keep current rebating prohibitions for personal and commercial lines; (2) raise the threshold that defines ‘‘large commercial risk’’ so fewer entities are subject to rebating rules; or (3) ban rebating for federal crop insurance while adopting other industry amendments. Godfrey told senators the department supported the set of amendments negotiated with industry and that banning rebating on crop insurance addresses the most frequent complaint his office receives.

Steve Becker, executive director of Professional Insurance Agents (PIA) of North Dakota, told the panel the PIA supports most department amendments but strongly objected to any carve‑out that permits rebating for a subset of customers. Becker said rebating is a consumer‑protection concern because it can skew agents’ incentives and leave consumers worse off.

Key clarifications adopted in the committee’s package included a $100 promotional exception for non‑rebating rules (e.g., small promotional items), a 12‑month limit for reopening supplemental claims (industry had proposed 6 months; department negotiated 12 months), and department authority to remove language concerning nominal property coverage for purchasing groups that conflicted with federal risk‑retention statutes. The committee also worked on arbitration language for surplus lines, with suggested limits to apply arbitration only where the entire risk is domiciled in North Dakota.

Senator Klein moved to adopt the combined amendment package (which included the department’s multi‑page edits, the single‑page adjustment to the definition of large commercial risk, and a two‑page amendment addressing rebating language). Senator Kessel seconded. The committee took a roll call and recorded a 5‑0 approval of the amendments, then voted 5‑0 to recommend a do‑pass on the bill as amended. Chairman Barta said he would carry the bill.

The transcript shows the committee’s debate focused on how to balance market competitiveness for large, sophisticated commercial buyers against consumer protections in personal lines and crop programs. Senators asked how the department monitors rebating complaints, and Commissioner Godfrey and Palsgraf described enforcement options ranging from administrative penalties (up to $10,000 per violation) to suspension or revocation of producer licenses. The department acknowledged enforcement is difficult in crop insurance because the product is standardized and incentives are often paid by agents rather than reported by consumers.

The bill as amended moves forward with committee support; the committee recorded that Chairman Barta (Chairman of the Industry and Business Committee) will carry the measure to the full Senate.