North Dakota the 47th jurisdiction to join the interstate insurance compact

North Dakota Gov. Doug Burgum signed legislation Thursday making the plains state the 47th member of the Interstate Insurance Product Regulation Compact.

Created by the National Association of Insurance Commissioners in 2002, the interstate insurance compact reviews and approves (or disapproves) individual and group annuity, life insurance, disability income, and long-term care insurance products.

Insurers may add North Dakota to submitted or previously approved annuity, life insurance, and disability income product filings beginning in mid-August, the North Dakota Insurance Department said in a news release.

"I am pleased to join my esteemed colleagues in the Insurance Compact,” said Jon Godfread, North Dakota insurance commissioner and 2023 vice president of the National Association of Insurance Commissioners. “North Dakotans will benefit from the speed-to-market delivery and wide array of product offerings that must meet stringent consumer-centric requirements."

States steadily joined the IPRC in the years following its adoption. Then the join rate slowed to a trickle. Only California, South Dakota, Florida and New York now remain outside the compact, although legislation has been introduced in New York.

The first departure

But it has not been all smooth sailing with the IPRC. Last June, South Carolina departed the compact – the first state to do so – in a dispute over long-term care rate reviews. North Dakota’s legislation did not include long-term care insurance products, so LTC insurance filings cannot be included.

Companies have the choice of filing products through the interstate insurance compact or filing products directly with a state. If a company chooses the latter course, then the regulator will apply the existing product standard laws and procedures of the state.

If a company files with the compact, then the compact's uniform standards and review process will apply. Many companies find it more efficient and expeditious to make one filing through the compact for all member states than to make individual filings in each state.

“I am delighted to welcome North Dakota into the Insurance Compact,” said Kathleen Birrane, Maryland Insurance Commissioner and Insurance Compact Chair. "We look forward to working with Commissioner Godfread and his staff on important initiatives to modernize the regulatory process for review and approval of asset-protection insurance products."

InsuranceNewsNet Senior Editor John Hilton covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.