Every insurance company licensed to do business in North Dakota is subject to a premium tax on the gross amount of its annual premiums, membership fees and policy fees received from North Dakota policyholders as reported on the company's North Dakota state page of its annual statement. The premium tax rate is two percent for life insurance and one and three-fourths percent for accident, health, property, casualty and surplus lines of insurance.
The insurance premium tax is administered by the Insurance Commissioner and is collected quarterly and deposited into the State General Fund. North Dakota law provides that properly organized fire districts receive financial assistance in the form of an annual payment which is also administered by the Commissioner. Therefore, the legislature appropriates an amount up to 100 percent of the fire insurance premium tax revenue collected to be allocated to qualified fire districts in the state of North Dakota.
The 65th Legislative Assembly of North Dakota appropriated $14,235,562 or as much of the sum as may be necessary for the biennium July 1, 2017 through June 30, 2019 for the purpose of making payments to qualifying fire districts located within the state of North Dakota. The $14,235,562 is allocated based on the relationship of gross premium reported for each fire district, to the total gross premiums reported statewide. Payments are mailed in December of each year.