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304.50-045 Initial and continuing financial solvency requirements.
(1)
(2)
To obtain and maintain a certificate of filing, a workers compensation
self-insured group shall have sufficient financial strength to pay all benefits for
compensation required by KRS Chapter 342 for risks covered by the group,
including known claims and expenses and incurred but not reported claims and
expenses.
(a) The trustees and administrators shall provide a fidelity bond to the
commissioner in the amount of not less than three hundred thousand
dollars ($300,000), which may be subject to a deductible not exceeding
ten thousand dollars ($10,000), for each trustee, each administrator and
the administrator's employees.
(b) The fiscal agent shall provide a fidelity bond to the trustees of not less
than fifty percent (50%) or one million dollars ($1,000,000), whichever is
lower, of the funds to be handled by the fiscal agent. This requirement
shall be waived if the fiscal agent is a national bank.
(c) The service organization shall provide a fidelity bond to the trustees of not
less than two (2) times the amount of the revolving fund.
(d) In lieu of the bonds required under paragraphs (a), (b), and (c) of this
subsection, the trustees may secure a fidelity blanket bond in an amount
not less than fifty percent (50%) of the self-insured group's premium or
two million dollars ($2,000,000), whichever is lower. The fidelity blanket
bond shall include the trustees, the administrator, the service
organization, personnel of the service organization, and the fiscal agent,
unless the fiscal agent is a national bank.
Effective:July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1631, effective July 15, 2010. -Created 2005 Ky. Acts ch. 7, sec. 9, effective March 1, 2005.
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