Section 3702.8 Of Article 1. Insurance And Security From California Labor Code >> Division 4. >> Part 1. >> Chapter 4. >> Article 1.
3702.8
. (a) Employers who have ceased to be self-insured employers
shall discharge their continuing obligations to secure the payment of
workers' compensation that accrued during the period of
self-insurance, for purposes of Sections 3700, 3700.5, 3706, and
3715, and shall comply with all of the following obligations of
current certificate holders:
(1) Filing annual reports as deemed necessary by the director to
carry out the requirements of this chapter.
(2) In the case of a private employer, depositing and maintaining
a security deposit for accrued liability for the payment of any
workers' compensation that may become due, pursuant to subdivision
(b) of Section 3700 and Section 3701, except as provided in
subdivision (c).
(3) Paying within 30 days all assessments of which notice is sent,
pursuant to subdivision (b) of Section 3745, within 36 months from
the last day the employer's certificate of self-insurance was in
effect. Assessments shall be based on the benefits paid by the
employer during the last full calendar year of self-insurance on
claims incurred during that year.
(b) In addition to proceedings to establish liabilities and
penalties otherwise provided, a failure to comply may be the subject
of a proceeding before the director. An appeal from the director's
determination shall be taken to the appropriate superior court by
petition for writ of mandate.
(c) Notwithstanding subdivision (a), any employer who is currently
self-insured or who has ceased to be self-insured may purchase a
special excess workers' compensation policy to discharge any or all
of the employer's continuing obligations as a self-insurer to pay
compensation or to secure the payment of compensation.
(1) The special excess workers' compensation insurance policy
shall be issued by an insurer authorized to transact workers'
compensation insurance in this state.
(2) Each carrier's special excess workers' compensation policy
shall be approved as to form and substance by the Insurance
Commissioner, and rates for special excess workers' compensation
insurance shall be subject to the filing requirements set forth in
Section 11735 of the Insurance Code.
(3) Each special excess workers' compensation insurance policy
shall be submitted by the employer to the director. The director
shall adopt and publish minimum insurer financial rating standards
for companies issuing special excess workers' compensation policies.
(4) Upon acceptance by the director, a special excess workers'
compensation policy shall provide coverage for all or any portion of
the purchasing employer's claims for compensation arising out of
injuries occurring during the period the employer was self-insured in
accordance with Sections 3755, 3756, and 3757 of the Labor Code and
Sections 11651 and 11654 of the Insurance Code. The director's
acceptance shall discharge the Self-Insurer's Security Fund, without
recourse or liability to the Self-Insurer's Security Fund, of any
continuing liability for the claims covered by the special excess
workers' compensation insurance policy.
(5) For public employers, no security deposit or financial
guarantee bond or other security shall be required. The director
shall set minimum financial rating standards for insurers issuing
special excess workers' compensation policies for public employers.
(d) (1) In order for the special excess workers' compensation
insurance policy to discharge the full obligations of a private
employer to maintain a security deposit with the director for the
payment of self-insured claims, applicable to the period to be
covered by the policy, the special excess policy shall provide
coverage for all claims for compensation arising out of that
liability. The employer shall maintain the required deposit for the
period covered by the policy with the director for a period of three
years after the issuance date of the special excess policy.
(2) If the special workers' compensation insurance policy does not
provide coverage for all of the continuing obligations for which the
private self-insured employer is liable, to the extent the employer'
s obligations are not covered by the policy a private employer shall
maintain the required deposit with the director. In addition, the
employer shall maintain with the director the required deposit for
the period covered by the policy for a period of three years after
the issuance date of the special excess policy.
(e) The director shall adopt regulations pursuant to Section
3702.10 that are reasonably necessary to implement this section in
order to reasonably protect injured workers, employers, the
Self-Insurers' Security Fund, and the California Insurance Guarantee
Association.
(f) The posting of a special excess workers' compensation
insurance policy with the director shall discharge the obligation of
the Self-Insurer's Security Fund pursuant to Section 3744 to pay
claims in the event of an insolvency of a private employer to the
extent of coverage of compensation liabilities under the special
excess workers' compensation insurance policy. The California
Insurance Guarantee Association and the Self-Insurers' Security Fund
shall be advised by the director whenever a special excess workers'
compensation insurance policy is posted.