Bill Summary – FastDemocracy

0457.03000
     Sixty-sixth
     Legislative Assembly                     HOUSE BILL NO. 1219
     of North Dakota
     Introduced by
       Representative Keiser
  A BILL for an Act to create and enact chapter 26.1-26.8 and chapter 26.1-39.2 of the North
  Dakota Century Code, relating to public adjuster licensing and to contracts between insured
  homeowners and residential contractors; to amend and reenact subdivision mm of subsection 2
  of section 12-60-24 of the North Dakota Century Code, relating to criminal history record
  checks; and to provide a penalty.
  BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
      SECTION 1. AMENDMENT. Subdivision mm of subsection 2 of section 12-60-24 of the
  North Dakota Century Code is amended and reenacted as follows:
           mm.    The insurance department for criminal history record checks authorized under
                 chapterchapters 26.1-26 and 26.1-26.8.
     SECTION 2. Chapter 26.1-26.8 of the North Dakota Century Code is created and enacted
 as follows:
     26.1-26.8-01. Scope.
     This chapter governs the qualifications and procedures for licensing public adjusters in this
 state and specifies the duties of and restrictions on public adjusters, including limitation of
 licensure to assisting only insureds with first-party claims.
     26.1-26.8-02. Definitions.
     As used in this chapter:
     1.    "Business entity" has the same meaning as provided in section 26.1-26-02.
     2.    "Department" means the insurance department.
     3.    "Home state" means the state in which the principal place of residence or principal
           place of business of the public adjuster is located.
     4.    "Insured" means a person insured under the insurance policy against which the claim
           is made.
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      5.   "Public adjuster" means a person that, for compensation, does the following:
           a.   Acts for or aids an insured in negotiating for or effecting the settlement of a
                first-party claim for loss or damage to real or personal property of the insured;
           b.   Advertises for employment as a public adjuster of first-party claims or otherwise
                solicits business or represents to the public the person is a public adjuster of
                first-party claims for loss or damage to real or personal property of an insured; or
           c.   Solicits the business of investigating or adjusting losses or of advising an insured
                about first-party claims for loss or damage to real or personal property of the
                insured.
     6.   "Uniform business entity application" means the uniform business entity application
          prescribed by the commissioner which conforms substantially to the uniform business
          entity application for resident and nonresident business entities adopted by the
          national association of insurance commissioners.
     7.   "Uniform individual application" means the uniform individual application prescribed by
          the commissioner which conforms substantially to the uniform application for individual
          adjuster licensing adopted by the national association of insurance commissioners.
    26.1-26.8-03. License required - Penalty.
     1.   A person may not operate as or represent that the person is a public adjuster in this
          state unless the person is licensed as a public adjuster in accordance with this
          chapter.
     2.   A public adjuster may not misrepresent to an insured the public adjuster is an adjuster
          representing an insurer in any capacity, including acting as an employee of the insurer
          or acting as an independent adjuster.
     3.   A public adjuster may not solicit or enter an agreement for the repair or replacement of
          damaged property on which the public adjuster has engaged to adjust or settle claims
          for losses or damages of the insured.
     4.   Except as provided in subsection 1, licensure as a public adjuster is not required for:
          a.   An attorney admitted to practice in this state, in the course of acting in the
               attorney's professional capacity as an attorney;
          b.   A person that negotiates or settles claims arising under a life or health insurance
               policy or an annuity contract;
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           c.   An individual employed for the limited purpose of obtaining facts surrounding a
                loss or furnishing technical assistance to a licensed public adjuster, including a
                photographer, estimator, private investigator, engineer, or handwriting expert;
           d.   A licensed health care provider, or an employee of a licensed health care
                provider, who prepares or files a health claim form on behalf of a patient; or
           e.   A person that settles subrogation claims between insurers.
      5.   A person willfully violating subsection 1 or 2 is guilty of a class C felony.
      26.1-26.8-04. Application for resident license.
      An individual applying for a resident public adjuster license shall submit to the
 commissioner a completed uniform individual application and declare under penalty of denial,
 suspension, or revocation of the license that the statements made in the application are true,
 correct, and complete to the best of the individual's knowledge and belief. The commissioner
 shall approve the application if the commissioner determines the individual:
     1.   Is at least eighteen years of age;
     2.   Has a principal place of residence or principal place of business in this state;
     3.   Has not committed an act that is a ground for denial, suspension, or revocation set
          forth in section 26.1-26.8-10;
     4.   Has paid the resident licensing fee, not to exceed one hundred dollars, prescribed by
          the commissioner;
     5.   Except as otherwise provided in this chapter, has passed the examinations required by
          section 26.1-26.8-07;
     6.   Is trustworthy, reliable, and of good reputation;
     7.   Is financially responsible to exercise the license and has provided proof of financial
          responsibility, as required in section 26.1-26.8-11;
     8.   Maintains an office in this state, with public access to the office by reasonable
          appointment or regular business hours; and
     9.   Has completed a criminal history record check as provided in section 12-60-24.
          a.   All costs associated with the criminal history record check under this section are
               the responsibility of the applicant.
          b.   This subsection does not apply to license continuation under section
               26.1-26.8-09 or to an individual who applies for a public adjuster license within
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                twelve months following the cancellation or expiration of a valid resident public
                adjuster license issued by the department, unless the license was suspended or
                revoked.
           c.   The commissioner may make arrangements, including contracting with an
                outside service, for the collection and transmission of fingerprints for conducting
                criminal history record checks.
     26.1-26.8-05. Nonresident license reciprocity.
      1.   An individual applying for a nonresident public adjuster license shall apply to the
           commissioner in the manner prescribed by the commissioner and declare under
          penalty of denial, suspension, or revocation of the license that the statements made in
          the application are true, correct, and complete to the best of the individual's knowledge
          and belief. The commissioner shall approve the application if the commissioner
          determines the applicant:
          a.   Is licensed as a resident public adjuster and in good standing in the individual's
               home state and the home state awards nonresident public adjuster licenses to
               residents of this state on the same basis as provided for in this chapter; and
          b.   Has paid the nonresident licensing fee, not to exceed one hundred dollars,
               prescribed by the commissioner.
     2.   The commissioner may verify the licensing status of a nonresident public adjuster
          through the producer data base maintained by the national association of insurance
          commissioners, or the association's affiliates or subsidiaries.
     3.   As a condition to continuation of a nonresident public adjuster license, a nonresident
          public adjuster shall maintain a resident public adjuster license in good standing in the
          individual's home state.
     4.   A licensed nonresident public adjuster shall surrender immediately to the
          commissioner the individual's nonresident public adjuster license and the
          commissioner shall terminate the individual's nonresident public adjuster license if the
          home state public adjuster license terminates for any reason, unless the individual has
          been issued a license as a resident public adjuster in a new home state and the new
          home state has reciprocity with this state. A licensed nonresident public adjuster shall
          notify the commissioner of a change to a new home state as soon as possible, but no
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           later than thirty days after receiving a license as a resident public adjuster from the
           new home state. The licensed nonresident public adjuster shall include both the new
           and the old addresses in the notice to the commissioner.
     26.1-26.8-06. License required for business entity.
      1.   A business entity acting as a public adjuster in this state must be licensed as a public
           adjuster license. A business entity applying for a public adjuster license shall submit to
           the commissioner a completed uniform business entity application and declare under
           penalty of denial, suspension, or revocation of the license that the statements made in
           the application are true, correct, and complete to the best of the knowledge and belief
          of the entity. The commissioner shall approve the application if the commissioner
          determines the applicant:
          a.   Has paid the business entity licensing fee, not to exceed one hundred fifty
               dollars, prescribed by the commissioner; and
          b.   Has designated a resident public adjuster or a nonresident public adjuster
               licensed pursuant to this chapter to be responsible for compliance with the
               insurance laws, rules, and regulations of this state for the business entity.
     2.   The commissioner may require additional documents be submitted that are reasonably
          necessary to verify the information contained in an application pursuant to this section.
    26.1-26.8-07. Examination.
     1.   An individual applying for a resident public adjuster license shall pass a written
          examination, unless exempt pursuant to section 26.1-26.8-08. The examination must
          test the individual's knowledge concerning the duties and responsibilities of a public
          adjuster and the insurance laws and regulations of this state and be conducted as
          prescribed by the commissioner.
     2.   The commissioner may make arrangements, including contracting with an outside
          testing service, for administering the written examination required pursuant to
          subsection 1 and collecting the nonrefundable fee as prescribed by the commissioner
          as set forth in section 26.1-01-07.
     3.   An individual applying for examination shall remit a nonrefundable fee as prescribed
          by the commissioner as set forth in section 26.1-01-07.
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      4.   An individual who fails to appear for the examination as scheduled or fails to pass the
           examination may reapply for an examination if the individual remits all required fees
           and forms before being rescheduled for another examination.
     26.1-26.8-08. Exemptions from examination.
      1.   An individual who applies for a resident public adjuster license in this state who was
           previously licensed as a public adjuster in another state is not required to complete an
           examination. This exemption is available only if:
           a.   The applicant is currently licensed in another state; or
           b.   The commissioner receives the application within ninety days of the cancellation
               of the applicant's previous license and the prior state issues a certification that, at
               the time of cancellation, the applicant was in good standing in the state or the
               state's public adjuster database records, maintained by the national association
               of insurance commissioners or the association's affiliates or subsidiaries, indicate
               the applicant is or was licensed in good standing.
     2.   To become a resident licensee pursuant to section 26.1-26.8-04, an individual licensed
          as a public adjuster in another state who moves to this state shall apply within ninety
          days of establishing legal residence in this state. An examination may not be required
          of that individual to obtain a resident public adjuster license unless the commissioner
          determines otherwise by rule.
     3.   If an individual who applies for a resident public adjuster license previously was
          licensed as either a resident public adjuster or a nonresident public adjuster in this
          state, the commissioner may not require the individual to complete an examination if:
          a.   The application is received within twelve months of the termination of the
               previous license in this state; and
          b.   At the time of the termination, the applicant was in good standing in this state.
    26.1-26.8-09. License - Renewal - Reinstatement.
     1.   The commissioner shall issue a resident public adjuster license or nonresident public
          adjuster license to an individual who meets the necessary requirements of this
          chapter.
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           a.   A resident public adjuster license and a nonresident public adjuster license expire
                on the last day of the month of the licensed public adjuster's birthday following
                the two-year anniversary of issuance of a license by the commissioner.
           b.   To renew a license, a licensed resident public adjuster and a licensed
                nonresident public adjuster shall file a biennial license continuation in the form
                and manner prescribed by the commissioner and pay a fee of twenty-five dollars.
                The commissioner shall give a licensee at least sixty days' notice of the biennial
                license continuation filing deadline. A resident public adjuster or a nonresident
                public adjuster who allows the license to lapse may, within the twelve-month
               period immediately following the expiration date, reinstate the same license
               without the necessity of passing a written examination, upon payment of a
               reinstatement fee, not to exceed one hundred twenty-five dollars, prescribed by
               the commissioner in addition to the renewal fee.
          c.   The commissioner may grant an individual licensee who is unable to comply with
               license renewal procedures due to military service or some other extenuating
               circumstance, including a long-term medical disability, a waiver of an examination
               requirement or a fine, fee, or sanction imposed for failure to comply with renewal
               procedures.
     2.   The commissioner shall issue a business entity public adjuster license to a business
          entity that meets the necessary requirements of this chapter.
          a.   A business entity public adjuster license expires on the two-year anniversary of
               issuance of a license by the commissioner.
          b.   To renew a license, a licensed business entity public adjuster shall file a biennial
               license continuation in the form and manner prescribed by the commissioner.
          c.   A business entity public adjuster license may be renewed within the ninety-day
               period immediately preceding the expiration date upon payment of the renewal
               fee, not to exceed one hundred fifty dollars, prescribed by the commissioner. A
               business entity public adjuster that allows the license to lapse may, within the
               thirty-day period immediately following the expiration date, renew the same
               license upon payment of a late renewal fee, not to exceed one hundred
               twenty-five dollars, prescri