2005 West Virginia Code - §23-2C-3. — Creation of employer mutual as successor organization of the West Virginia Workers\' Compensation Commission.

§23-2C-3. Creation of employer mutual as successor organization of the West Virginia Workers' Compensation Commission.

(a) On or before the first day of June, two thousand five, the executive director may take such actions as are necessary to establish an employers' mutual insurance company as a domestic, private, nonstock, corporation to:
(1) Insure employers against liability for injuries and occupational diseases for which their employees may be entitled to receive compensation pursuant to chapter twenty-three of this code and federal Longshore and Harbor Workers' Compensation Act, 33 U.S.C. §901, et seq.;
(2) Provide employer's liability insurance incidental to and provided in connection with the insurance specified in paragraph (1), including coal-workers pneumoconiosis coverage and employer excess liability coverage as provided in this chapter; and
(3) Transact such other kinds of property and casualty insurance for which the company is otherwise qualified under the provisions of this code.
(4) The company shall not sell, assign or transfer substantial assets or ownership of the company.
(b) If the executive director establishes a domestic mutual insurance company pursuant to subsection (a) of this section:
(1) As soon as practical, the company established pursuant to the provisions of this article shall, through a vote of a majority of its provisional board, file its corporate charter and bylaws with the Insurance Commissioner and apply for a license with the Insurance Commissioner to transact insurance in this state. Notwithstanding any other provision of this code, the Insurance Commissioner shall act on the documents within fifteen days of the filing by the company.
(2) In recognition of the Workers' Compensation insurance liability insurance crisis in this state at the time of enactment of this article and the critical need to expedite the initial operation of the company, the Legislature hereby authorizes the Insurance Commissioner to review the documentation submitted by the company and to determine the initial capital and surplus requirements of the company, notwithstanding the provisions of section five-b, article three of chapter thirty-three. The company shall furnish the Insurance Commissioner with all information and cooperate in all respects necessary for the Insurance Commissioner to perform the duties set forth in this section and in other provisions of this chapter and chapter thirty-three. The Insurance Commissioner shall monitor the economic viability of the company during its initial operation on not less than a monthly basis, until such time as the commissioner in his or her discretion, determines that monthly reporting is not necessary. In all other respects the company shall be subject to comply with the applicable provisions of chapter thirty-three of this code.
(3) Subject to the provisions of subsection (4) of this section, the Insurance Commissioner may waive other requirements imposed on mutual insurance companies by the provisions of chapter thirty-three as the Insurance Commissioner determines is necessary to enable the company to begin insuring employers in this state at the earliest possible date.
(4) Within forty months of the date of the issuance of its license to transact insurance, the company shall comply with the capital and surplus requirements set forth in subsection (a), section five-b, article three, chapter thirty-three of this code in effect on the effective date of this enactment, unless said deadline is extended by the Insurance Commissioner.
(c) For the duration of its existence, the company is not and shall not be considered a department, unit, agency, or instrumentality of the state for any purpose. All debts, claims, obligations and liabilities of the company, whenever incurred, shall be the debts, claims, obligations and liabilities of the company only and not of the state or of any department, unit, agency, instrumentality, officer or employee of the state.
(d) The moneys of the company are not and shall not be considered part of the General Revenue Fund of the state. The debts, claims, obligations and liabilities of the company are not and shall not be considered a debt of the state or a pledge of the credit of the state.
(e) The company is not subject to provisions of article nine-a, chapter six of this code; the provisions of chapter twenty-nine-b of this code; the provisions of article three, chapter five-a of this code; the provisions of article six, chapter twenty-nine of this code; the provisions of article six-a of said chapter; or the provisions of chapter twelve of this code.
(f) If the commission has been terminated, effective upon said termination, private carriers, including the company, shall not be subject to payment of premium taxes, surcharges and credits contained in article three of chapter thirty-three of this code on premiums received for coverage under this chapter. In lieu thereof, the Workers' Compensation insurance market shall be subject to the following:
(1) Each fiscal year, the Insurance Commissioner shall calculate a percentage surcharge to be collected by each private carrier from its policy holders. The surcharge percentage shall be calculated by dividing the previous fiscal year's total premiums collected plus deductible payments by all employers into the portion of the Insurance Commissioner's budget amount attributable to regulation of the private carrier market. This resulting percentage shall be applied to each policy holder's premium payment and deductible payments as a surcharge and remitted to the Insurance Commissioner. Said surcharge shall be remitted within ten (10) days of receipt of premium payments, whenever said payments are made by its insureds;
(2) Each fiscal year, the Insurance Commissioner shall calculate a percentage surcharge to be remitted on a monthly basis by self-insured employers and said percentage shall be calculated by dividing previous year's self-insured payroll in the state into the portion of the Insurance Commissioner's budget amount attributable to regulation of the self-insured employer market. This resulting percentage shall be applied to each self-insured employer's monthly payroll and the resulting amount shall be remitted as a regulatory surcharge by each self-insured employer. The Workers' Compensation board of managers may promulgate a rule for implementation of this section. The company, all other private carriers and all self-insured employers shall furnish the Insurance Commissioner with all required information and cooperate in all respects necessary for the Insurance Commissioner to perform the duties set forth in this section and in other provisions of this chapter and chapter thirty-three. The surcharge shall be calculated so as to only defray the costs associated with the administration of chapter twenty-three of this code and the funds raised shall not be used for any other purpose.
(3) Upon termination of the commission, the company and all other private carriers shall collect a premiums surcharge from their policy holders equal to ten percent, or such higher or lower rate as annually determined, by the first day of May of each year, by the Insurance Commissioner to produce forty-five million dollars annually, of each policy holder's periodic premium amount for Workers' Compensation insurance. Additionally, by the first day of May each year, the self-insured employer community shall be assessed a cumulative total of nine million dollars. The methodology for the assessment shall be fair and equitable and determined by exempt legislative rule issued by the Workers' Compensation board of managers. The amount collected shall be remitted to the Insurance Commissioner for deposit in the Workers' Compensation Debt Reduction Fund created in section five, article two-d of this chapter.
(g) The new premiums surcharge imposed by subdivision (2), subsection (f) of this section shall sunset and not be collectible with respect to Workers' Compensation insurance premiums paid when the policy is renewed on or after the first day of the month following the month in which the Governor certifies to the Legislature that the revenue bonds issued pursuant to article two-d, chapter twenty-three of this code have been retired and that the unfunded liability of the old fund has been paid or has been provided for in its entirety, whichever occurs last.