26.1-46-08. Restrictions on insurance purchased by purchasing groups

26.1-46-08. Restrictions on insurance purchased by purchasing groups 1. A purchasing group may not purchase insurance from a risk retention group that is not chartered in a state or from an insurer not admitted in the state in which the purchasing group is located, unless the purchase is effected through a licensed insurance producer acting pursuant to the surplus lines laws and regulations of such state. 2. A purchasing group which obtains liability insurance from an insurer not admitted in this state or a risk retention group shall inform each of the members of the group which have a risk resident or located in this state that the risk is not protected by an insurance insolvency guaranty fund in this state, and that the risk retention group or insurer may not be subject to all insurance laws and rules of this state. 3. A purchasing group may not purchase insurance providing for a deductible or self-insured retention applicable to the group as a whole unless the purchasing group uses a policyholder's disclosure statement approved by the commissioner which clearly explains in simplified language the policy is subject to a group deductible or self-insured retention and provides a detailed explanation of the process of the satisfaction of the deductible or self-insured retention among members. 4. A purchasing group may not purchase insurance providing for a shared aggregate limit applicable to the group as a whole unless the purchasing group uses a policyholder's disclosure statement approved by the commissioner which clearly explains in simplified language the policy is subject to a group aggregate limit and coverage for each individual member could be exhausted by claims from other members. The insurance must allow for an individual member to purchase additional limits in the event of exhaustion and this option must be described in the disclosure statement.