Dagg (21) appears to be a wanted man, with both the Crusaders and the Highlanders chasing him while Hawkes Bay is keen to see the fullback stay in the province.
Dagg's agent, Simon Porter, said no decision had been made yet on where Dagg would play next season, but he conceded there was a fair bit of interest around the traps.
Dagg's contract with Hawkes Bay concludes at the end of this season.
Hawkes Bay winger Zac Guildford signed with the Crusaders on Monday but will be loaned back to play for the Hawkes Bay union in the national provincial championship.
He has played for two years for the Hurricanes but shifted south to get more game time, with a logjam of wingers in the Hurricanes franchise.
The Crusaders have made an offer to Dagg but he has yet to put pen to paper.
Porter said Dagg had enjoyed his time immensely in the Highlanders this year, especially under the tutelage of coaches Glenn Moore and Peter Russell.
"But at this stage no decision has been made by Israel. It's not very often when you come off contract so he wants to get it right," Porter said.
He said Dagg had to make a decision by the middle of next month.
The Crusaders had already invited Dagg down to Christchurch to inspect their facilities and it would hard for Dagg to turn down an offer from the Crusaders franchise.
He was unlikely to be needed by the Hurricanes as they had Cory Jane to play fullback and an abundance of backline talent.
Highlanders chief executive Richard Reid said Dagg's situation was a work in progress, but felt the best way to secure the player was through a transfer and loan back to Hawkes Bay.
In this situation, Hawkes Bay will pay his wages, similar to the Guildford deal.
That stopped all the players signing with the Super 14 home unions, and spread the talent around the country.
Highlanders coach Glenn Moore had been in contact with Dagg but he could not say to which team the fullback was heading.
Reid said the union had made an offer to Ellison (26) but had been informed yesterday by the player's agent that Ellison would not be moving south.
Reid admitted it was disappointing to miss out on a player of the calibre of Ellison.
Ellison had family in Dunedin, and signing for Otago and the Highlanders would have meant more game time, Reid said.
"But he informed us today that he is not interested in coming south. We were keen for him to have a crack down here but for whatever reason, and I don't know the guy, he does not want to come down here."
Ellison has been a part of the All Blacks' Tri-Nations squad but has yet to make it on to the paddock.
Reid confirmed the franchise was looking around for a first five-eighth.
Mathew Berquist and Daniel Bowden played at first five-eighth for the Highlanders last season, but Bowden is playing for Auckland and is likely to get into the Blues.
Berquist has been struggling to get game time for Hawkes Bay and may struggle to be picked for the Highlanders.
Reid said the union had about 30 players on contract, a number with which he was comfortable.
The union did not have a lot of spare cash, so could not afford to bring in many new players.
