North Dakota Liability & Workers' Compensation Insurance

Commercial General Liability (CGL)

What CGL Covers

Commercial General Liability provides essential protection for businesses:

Coverage A - Bodily Injury & Property Damage Liability

The core of CGL coverage:

Bodily Injury:

• Customer slip-and-fall on premises
• Injury from product sold
• Injury caused by business operations

Property Damage:

• Damage to customer property
• Damage caused by completed work
• Damage from business operations

Coverage Triggers

CGL policies use occurrence or claims-made triggers:

CGL Exclusions

Common CGL exclusions include:

CGL Limits Structure

North Dakota Workers' Compensation - Workforce Safety & Insurance (WSI)

The Monopolistic State Fund

North Dakota is one of only four states with a monopolistic (exclusive) state fund for workers' compensation:

CRITICAL Exam Point: Private insurance companies CANNOT write workers' compensation insurance in North Dakota. All employers MUST obtain coverage through WSI.

What This Means for the Exam

• Know that WSI is the exclusive provider
• Private insurers cannot compete
• Employers have no choice of carrier
• This is a monopolistic state fund system

WSI Overview

Employer Requirements

All North Dakota employers must:

1. Register with WSI - Before hiring first employee
2. Pay Premiums - Based on payroll and classification
3. Report Injuries - File First Report of Injury within required time
4. Maintain Records - Keep payroll and injury records

Coverage Provided by WSI

Who Must Be Covered

Premium Calculation

WSI premiums are based on:

$\text{Premium} = \frac{\text{Payroll}}{100} \times \text{Classification Rate} \times \text{Experience Mod}$

Experience Rating

• New employers start at 1.0 (unity)
• Good claims experience = lower mod (<1.0)
• Poor claims experience = higher mod (>1.0)
• Based on 3-year claims history

Penalties for Non-Compliance

Employers who fail to obtain WSI coverage face:

Exclusive Remedy Rule

What Exclusive Remedy Means

When an employer has WSI coverage:

• Employees cannot sue employer for work injuries
• WSI benefits are the exclusive remedy
• Protects employers from lawsuits
• Employees receive guaranteed benefits

Exceptions to Exclusive Remedy

Employees MAY be able to sue if:

• Employer intentionally caused injury
• Third party caused injury (can sue third party)
• Employer failed to maintain coverage
• Injury from co-employee's gross negligence

Professional Liability Insurance

Errors & Omissions (E&O) Coverage

Professional liability insurance protects against claims of:

Who Needs E&O Insurance

E&O Policy Features

Exam Tip: Insurance producers in North Dakota should carry E&O coverage to protect against claims of professional negligence. While not always required, it is considered a best practice.

Umbrella and Excess Liability

Umbrella Liability

Umbrella policies provide:

Underlying Requirements

Umbrella policies require minimum underlying limits:

Why Businesses Need Umbrella Coverage

• Large lawsuits can exceed primary limits
• Protects business assets from judgment
• Relatively inexpensive for large limits
• Provides peace of mind

Exam Tip: Remember that North Dakota uses WSI for workers' compensation - a monopolistic state fund where private insurers CANNOT write coverage. This is unique and will be tested.