Texas Labor Code - Section 407A.051. Application For Initial Certificate Of Approval; Approval Requirements
Legal Research Home >
Texas Lawyer > Labor Code > Texas Labor Code - Section 407A.051. Application For Initial Certificate Of Approval; Approval Requirements
§ 407A.051. APPLICATION FOR INITIAL CERTIFICATE OF
APPROVAL; APPROVAL REQUIREMENTS. (a) An association of employers
that proposes to organize as a workers' compensation self-insurance
group shall file with the department an application for a
certificate of approval.
(b) The application must be in the form prescribed by the
commissioner and must include:
(1) the name of the group;
(2) the location of the group's principal office;
(3) the date of organization of the group;
(4) the name and address of each employer that is a
member of the group;
(5) the name, mailing address, and telephone number of
the trade or professional association to which each group member
belongs as required by Section 407A.002(a)(2);
(6) the governing classification code of the group or
a description of the operations of each member of the group showing
that the members of the group are engaged in similar operations;
and
(7) any other information reasonably required by the
commissioner.
(c) The application must be accompanied by:
(1) a nonrefundable $1,000 filing fee;
(2) proof of compliance with the financial
requirements under Section 407A.053;
(3) proof of compliance with the excess insurance
requirements under Section 407A.054;
(4) a copy of the articles of association or
declaration of trust of the group, if any;
(5) a copy of any agreements entered into with an
administrator or a service company;
(6) a copy of the bylaws of the proposed group;
(7) a copy of the agreement between the group and each
employer who is a member of the group that:
(A) secures the payment of workers' compensation
benefits; and
(B) includes provisions for payment of
assessments as provided by Section 407A.355;
(8) designation of the initial board of trustees and
administrator of the group;
(9) the address in this state where the books and
records of the group will be maintained at all times;
(10) a pro forma financial statement, in a form
acceptable to the commissioner, that shows the financial ability of
the group to pay the workers' compensation obligations of the
employers who are members of the group;
(11) proof of one of the following:
(A) payment to the group, or a bona fide promise
to pay on approval of the group, by each employer who is a member of
the group of not less than 25 percent of that member's first year
estimated modified schedule rating premium on a date prescribed by
the commissioner, which shall be considered part of the first year
premium payment of each member; or
(B) if the group is formed from a trust existing
on September 1, 2003, that the assets of the trust are sufficient to
cover the workers' compensation obligations of the trust;
(12) a $250,000 fidelity bond for the administrator in
the form prescribed by the commissioner;
(13) a $250,000 fidelity bond for the service company
in the form prescribed by the commissioner; and
(14) an indemnity agreement that meets the
requirements of Section 407A.056.
(d) Not later than the 30th day after the effective date of
the change, a group shall notify the commissioner of any change in:
(1) the information required to be filed under
Subsection (c); or
(2) the manner of the group's compliance with
Subsection (c).
(e) The commissioner shall evaluate the financial
information provided with the application as necessary to ensure
that:
(1) the funding is sufficient to cover expected losses
and expenses; and
(2) the funds necessary to pay workers' compensation
benefits will be available on a timely basis.
(f) Except as otherwise provided by this subsection, the
commissioner shall act on a complete application for a certificate
of approval not later than the 90th day after the date on which the
application is filed with the department. If, because of the number
of applications, the commissioner is unable to act on an
application in a timely manner, the commissioner may extend the
period for an additional 30 days.
(g) Fees collected under this section shall be deposited in
the department's operating account.
(h) In lieu of the bonds required under Subsections (c)(12)
and (c)(13), a security deposit of cash or securities acceptable to
the commissioner may be deposited with the commissioner to be held
in the state treasury.
Added by Added by Acts 2003, 78th Leg., ch. 275, § 1, eff. Sept.
1, 2003. Amended by Acts 2005, 79th Leg., ch. 1055, § 2, eff.
Sept. 1, 2005.
Section: 407A.002 407A.003 407A.004 407A.005 407A.006 407A.007 407A.008 407A.051 407A.052 407A.053 407A.054 407A.055 407A.056 407A.057 407A.101
Last modified: August 10, 2007
|
