Crop-Hail Guidelines

[LOGO] State of North Dakota Office of the Commissioner of Insurance J. O. Wigen, Commissioner State Capitol Building Bismarck, North Dakota 58505 Phone: (701) 224-2440 BULLETIN 83-3 TO : ALL COMPANIES WRITING CROP-HAIL INSURANCE IN NORTH DAKOTA AND CROP-HAIL AGENTS FROM: J. O. WIGEN, COMMISSIONER OF INSURANCE RE : CROP-HAIL GUIDELINES DATE: JANUARY 21, 1983 J.W. The following guidelines are hereby adopted as being in the best interest of North Dakota insureds and the crop- hail insurance companies doing business in North Dakota, and the following guidelines supercede and replace any and all existing bulletins relating to crop-hail insur- ance. 1. All new business written after the date of this bulletin shall have a maximum term of one year at the annual rates in effect on the date the application is accepted. 2. Coverage shall not be written effec- tive any earlier than 12:01 a.m. of the calendar day after acceptance of the com- pleted application for insurance by the agent on behalf of the insurer. 3. A cash discount of not to exceed 5% of the total premium may be granted to policy- holders who pay the entire premium as of the date of the application for insurance. This discount shall only be payable directly to the insured. All applications for policies which provide a cash discount must set out on the face of the application an explanation of the discount and a statement that the discount is payable only to the policyholder. 4. All varieties of a given crop shall be written at the same rate. (OVER) Bulletin 83-3 Page 2 5. Any company desiring not to file its own rate information must utilize either Crop-Hail Insurance Actuarial Association (CHIAA) or Hail Information Services, Inc. (HIS). 6. There shall be no "guaranteed dividends" provided with regard to any policy of crop-hail insurance. Only insurance companies or insurers may pay dividends and they shall be paid directly to the policyholder. A dividend shall not be used as a credit against the next year's premium. on must utilize either Crop-Hail Insurance Actuarial Association (CHIAA) or Hail Information Services, Inc. (HIS). 6. There shall be no "guaranteed dividends" provided with regard to any policy of crop-hail insurance. Only insurance companies or insurers may pay dividends and they shall be paid directly to the policyholder. A dividend shall not be used as a credit against the next year's premium. The department has been informed that there have been potential violations of the statutory prohibitions against rebating. The department will strictly enforce the rebating statutes with regard to crop-hail insurance. JOW:pas