Committee advances state-run insurance fund changes, approves escrow-interest bill and rejects board investment bill

The House Industry, Business and Labor Committee on a banker‑heavy hearing day advanced two related bills to change how North Dakota’s State Fire and Tornado Fund and State Bonding Fund are administered, approved legislation requiring interest on many mortgage escrow accounts, and rejected a measure that would explicitly allow the State Board of University and School Lands to invest up to 10% of managed funds in precious metals or digital assets.

Lawmakers voted to give HB1026 and HB1027 a “do pass” recommendation after the North Dakota insurance commissioner and the state’s public risk pool briefed the committee on operations, contract rules and new amendment language. The actions formally authorize continued use of an external risk pool to administer those constitutional funds and add contract, appraisal and reporting requirements intended to reduce gaps in property coverage for state agencies and political subdivisions.

The bills matter because the funds provide property coverage for state entities and political subdivisions. Committee members pressed agency witnesses on whether outsourcing administration to the North Dakota Insurance Reserve Fund (the state’s public risk pool) creates a conflict when the Insurance Department both regulates the pool and contracts with it for administration. Insurance Commissioner John Godfried told the committee the arrangement grew from concerns about under‑insured property and from a government finance interim committee recommendation.

"We had about 2 staff members that were in charge of, responsible for administering this fund, and that provides property coverage for state…