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North Dakota – Workers Compensation Mutual Insurance Company?


Is North Dakota Headed Towards A Commercial Insurance Market?

North Dakota may soon turn into a mutual Workers Comp Insurance company such as Nevada did with Employers Holdings Inc., and West Virginia did with Brickstreet.

Both of those companies are having somewhat of a success in being private insurance carriers, and they both have a full market with West Virginia opening their market on July 1, 2008.

Vector of North Dakota Illustration Insurance protection

North Dakota lawmakers will explore the potential for converting the state’s monopoly workers compensation insurer into a competitive mutual insurer.

A North Dakota legislative committee is scheduled July 10 to hear from insurers in West Virginia and Nevada, where state workers compensation insurers have converted to private insurers. North Dakota Workforce Safety & Insurance is now the only insurer allowed to provide workers comp coverage in the state. If lawmakers press ahead with legislation, other workers comp insurers would be allowed to operate in the state.

The most fair way to price Workers Compensation insurance is with a free and open market. Time and time again, removing the government from an operation almost always makes the economy for that product or service more profitable, and provides a higher level of service. A recent example is the removal of tobacco subsidies by the federal government.

Picture Of Tabacco North Dakota On Box
Wikipedia – Sjschen

I applaud North Dakota for their efforts, just as I have for the tremendous effort of the West Virginia Department of Insurance.

Update  6/27/2017 – This situation never occurred with WSI.  The state remains monopolistic.  The oil boom over the last 7 – 8 years affected the decision to change to an open market system.  Nevada and West Virginia employers now enjoy much-reduced workers compensation rates.

Hopefully, North Dakota will reconsider going to a private market soon.

Workers Comp Coverage Opportunity

The state of North Dakota is one of the last bastions in old-school work comp insurance.

As I have said in many previous posts, a monopolistic Workers Comp carrier is not the best choice for a Workers Comp system in any state. North Dakota seems to have agreed to keep their current government-run monopolistic carrier.

Map of North Dakota On USA flag

Officials from Nevada and West Virginia say that taking their state’s workers` compensation operations private has helped lower insurance rates and provide better service, but the officials say the moves were prompted by severe money problems.  The Peace Garden state’s Workers Compensation system is financially healthy.

State legislators say there may not be much support for taking it private. Right now, businesses that must have workers` compensation coverage have to buy it from North Dakotas Workforce Safety and Insurance agency.

While North Dakota may be solvent and healthy, that may be at the expense of businesses paying out more Workers Comp premiums than in an open market such as Nevada or West Virginia have begun in the last few years/months.

Update – Both Nevada and West Virginia have reduced their advisory loss costs many times over the last ten years.  The voluntary market carriers have provided a much healthier WC environment.

Update – as of 2018,  the Roughrider State provides Workers Compensation coverage for employers through its monopolistic state fund – WSI.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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