Best Small Business Insurance in North Dakota

North Dakota Insurance Requirements

North Dakota currently requires businesses with employees to carry workers’ compensation insurance. Businesses that operate any vehicles must also carry automotive liability insurance. 

Commercial Auto Insurance

In North Dakota, persons who own and operate a motor vehicle must demonstrate their ability—financial responsibility—to pay compensation should that vehicle be involved in an accident. The two main ways of showing financial responsibility are obtaining approval to be self-insured or with an auto liability policy issued by a private carrier. 

The policy must, at a minimum, have 25-50-25 coverage. This means $25,000 payable to an injured person, with a limit of $50,000 per accident where two persons are injured, and $25,000 payable for property damage. 

39-16.1-09: Proof by showing insurance coverage

(1) Proof of financial responsibility may be furnished by filing with the director the written or electronically transmitted certificate of any insurance carrier duly authorized to do business in this state certifying that there is in effect a motor vehicle liability policy for the benefit of the person required to furnish proof of financial responsibility.

39-16.1-11: Motor vehicle liability policy

(2)(b) Such owner's policy of liability insurance … must insure the person named therein and any other person … as follows: twenty-five thousand dollars because of bodily injury to or death of one person in any one accident and subject to said limit for one person, fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and twenty-five thousand dollars because of injury to or destruction of property of others in any one accident.

Workers’ Compensation Insurance

North Dakota operates its own industrial insurance scheme, meaning no private insurance company can offer workers’ compensation (WC) insurance in the state. Workers’ comp insurance is run by the North Dakota Workforce Safety & Insurance Organization (WSI), and all employers, except those authorized to self-insure, must purchase WC insurance from the State fund rather than from private insurance companies.

All employers with workers must participate in the scheme, regardless of whether those employees are full-time, part-time, seasonal, or occasional workers. Premiums contributed by employers go into the Workforce Safety and Insurance Fund, from which all compensation claims are paid.

65-04-04: Employers obligated to pay premiums and assessments - Certificate provided

Each employer … shall pay into the fund the amount of premium and assessment determined by the organization … The organization shall provide to the employer a certificate specifying that the payment has been made. The certificate, is prima facie evidence of the payment of the premium.

Data Breach Insurance

North Dakota’s Data Breach Notification Statute places a duty on businesses to report a data breach to any resident whose personal information has been or may be affected by the breach.

For businesses that handle customers’ personal information, the requirement to notify affected individuals increases the chances of being sued if a data breach occurs. Having to defend against claims of negligence can drain resources. But data breach insurance can provide the funds to compensate claimants if the need arises. 

51-30-02: Notice to attorney general and consumers

Any person that owns or licenses computerized data that includes personal information, shall disclose any breach of the security system following discovery or notification of the breach in the security of the data to any resident of the state whose unencrypted personal information was, or is reasonably believed to have been, acquired by an unauthorized person.

North Dakota Insurance Resources

North Dakota Insurance Department - Business
North Dakota Insurance Department - Auto FAQS
North Dakota Insurance Department - Auto Basics
North Dakota Workforce Safety & Insurance

General Liability Insurance

The vast majority of North Dakota companies purchase general liability insurance from an insurance company even though it is not legally required. This type of business liability insurance covers third-party bodily injury, third-party property damage, advertising liability, libel, slander, copyright issue, and other common claims faced by companies across various industries. 

General liability insurance is one of the most important types of business insurance your company can purchase.

Business Owner’s Policy

A business owner’s policy (BOP) is an affordable way to bundle business insurance coverages. This type of policy includes commercial general liability insurance with commercial business property insurance. Many small business owners with a physical business space opt for this coverage.

Commercial Auto Insurance

You need to carry commercial auto insurance if your company uses vehicles to transport people or goods. This type of insurance is very similar to personal auto insurance and covers liability, medical costs, collisions, and uninsured/underinsured motorists. A commercial auto policy also covers vehicles rented or owned by your company and employees who use their own vehicles for company business.

Workers’ Compensation Insurance

North Dakota requires all businesses with any number of employees to carry workers’ compensation insurance, regardless of whether those employees are full-time, part-time, seasonal, or occasional workers. It’s a good idea to subscribe to such insurance. Taking out workers' compensation insurance puts a limit on the amount and type of compensation that an injured employee may receive. The limits are set by law.

Employee Health/Life/Disability Insurance

Companies that provide health, life, and/or disability insurance as a fringe benefit will need appropriate North Dakota insurance. Under the Affordable Care Act, firms with more than 50 full-time employees must offer health insurance or pay an expensive penalty.

Professional Liability Insurance

Professional liability insurance covers financial risks to attorneys, accountants, and other people who provide professional services or expertise. Professional liability coverage varies depending on the industry but usually includes negligence, legal defense, slander or libel, and copyright and trademark disputes. 

Professional liability insurance includes errors and omissions (E&O) insurance.

Data Breach Insurance

If your company hosts customers’ personal information on its servers and those servers are hacked, lawsuits and damages can result. Data breach insurance protects you in these cases. 

Cyber Liability Insurance

Similar to but more comprehensive than data breach insurance, cyber liability insurance may pay for legal expenses related to a data breach or set up a call center for individuals affected by a breach. It also may pay for active protection against cyberattacks.

Commercial Crime Insurance

Crimes like extortion, forgery, burglary, computer fraud, and embezzlement are covered by commercial crime insurance. Situations in which this type of insurance is particularly useful include dishonest or libelous acts by employees.

Fiduciary Liability Insurance

Fiduciaries, who are legally required to act in plan participants’ best interests rather than the company’s when choosing advisors and investments, should consider this type of insurance coverage. It covers them if they are sued for allegedly providing negligent investment advice or administering plans or benefits incorrectly. 

Third parties like out-of-company consultants and benefit plan administrators are usually not protected.

Directors and Officers Insurance

Any company with directors and officers should consider directors and officers (D&O) insurance coverage, a type of liability insurance that reimburses directors and officers for claims made against them regarding harm allegedly caused by their management decisions.

Executive Risk Coverage

Executive risk insurance is business liability insurance that provides coverage for fraud, D&O, employment practices, initial public offerings, pension funds, extortion, and professional negligence.