North Dakota Marketing Rules, Ethics & Unfair Practices
The final North Dakota topic covers market conduct: the unfair trade practices the state prohibits, the ban on rebating and misrepresentation, and the fiduciary duties a producer owes clients and insurers. These duties translate the state's consumer-protection goals into day-to-day sales conduct.
Unfair Trade Practices
North Dakota prohibits unfair and deceptive practices in the business of insurance. These include misrepresenting policy terms, benefits, or dividends; twisting (using misrepresentation to induce a policyowner to replace coverage to their detriment); defamation of an insurer; unfair discrimination between similar risks; and false or misleading advertising. Each is separately actionable and can support license discipline.
Rebating and Inducements
Like most states, North Dakota prohibits rebating -- giving a client any premium discount, cash, or valuable consideration not stated in the policy as an inducement to buy. Both the producer who offers and the applicant who accepts an unlawful rebate can be penalized. This general prohibition distinguishes North Dakota from the few states that permit filed, non-discriminatory rebating.
Fiduciary Duty and Suitability
Premiums a producer collects are trust funds held in a fiduciary capacity for the insurer and client; they must be remitted promptly and never commingled or converted. Producers must also recommend suitable products, disclose material facts, place business only with authorized insurers, and avoid conflicts of interest. These fiduciary and suitability duties are the ethical core of the North Dakota supplement.
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State-specific details
State exam facts
- State regulator
- North Dakota Insurance Department
- Exam vendor
- PSI
- Prelicensing education
- None (prelicensing courses are no longer required by North Dakota law)
- Passing score
- 70%
Who regulates life & health insurance licensing in North Dakota?
The North Dakota Insurance Department licenses producers. As of 2022, PSI Services is the exam vendor for North Dakota Insurance Producer License Examinations.
Does North Dakota require prelicensing education for the life & health exam?
No. North Dakota law no longer requires an individual to take prelicensing courses before the exam.
How is the North Dakota life & health exam structured?
North Dakota uses a one-part exam format covering both product knowledge and state law in a single sitting via PSI, with a 70% passing score.
Sources: https://www.insurance.nd.gov/producers/resident-producer, https://www.psiexams.com/
In the North Dakota Life & Health Insurance Producer Exam guide: A KEY CONCEPT box, a Common Traps list and a Check Yourself set closing each of the 9 national chapters. Practice here stays free.