2013 Kentucky Revised Statutes CHAPTER 304 - INSURANCE CODE Subtitle 50 - Workers' Compensation Self-Insured Groups 50.50-090 Membership -- Indemnity agreement -- Expulsion, nonrenewal, or cancellation of member by group -- Voluntary withdrawal -- Liability on termination of membership, insolvency, or bankruptcy.
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304.50-090 Membership -- Indemnity agreement -- Expulsion, nonrenewal, or
cancellation of member by group -- Voluntary withdrawal -- Liability on
termination of membership, insolvency, or bankruptcy.
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An employer joining a workers compensation self-insured group after the
group has been issued a certificate of filing shall submit an application for
membership to the board of trustees or its administrator and enter into an
indemnity agreement. Membership shall not take effect earlier than each
member's date of application. The application for membership and its approval
shall be maintained as permanent records of the board of trustees. The board
of trustees shall require each member to execute a joint and several liability
agreement, or other annual ratification or affirmation of indemnity, upon each
renewal.
The self-insured group shall be considered an individual employer for all
purposes of taxation and the individual members of the group shall not be
exposed to tax liability other than liability existing as a result of the indemnity
agreement with the other group members and the self-insured group.
At the discretion of the trustees, the self-insured group may include the
Kentucky employees of foreign (out-of-state) employers.
Individual members of a workers compensation self-insured group shall be
subject to expulsion, nonrenewal, or cancellation by the group by giving the
member and the commissioner of the Department of Workers' Claims thirty
(30) days advance notice. Such expulsion, nonrenewal, or cancellation shall be
executed in accordance with the bylaws of the group and for reasons including
but not limited to:
(a) Adverse claims experience;
(b) Lack of cooperation with safety and loss prevention policies; or
(c) Failure to report payroll in accordance with the rules and rating plan of the
self-insured group.
At least thirty (30) days prior to the due date, the trustees shall notify each
group member of all premiums due, including adjustments. Failure by a
member to pay the premium or assessments due prior to the due date may
result in immediate cancellation from the group by the trustees. Ten (10) days
advance notice of such cancellation shall be given to the member and the
commissioner of the Department of Workers' Claims.
Individual group members may elect to withdraw from the group only upon
sixty (60) days written notice to the commissioner of the Department of
Workers Claims and the trustees.
The trustees shall report to the commissioner any person who behaves
fraudulently as described in Subtitle 47 of this chapter.
A workers compensation self-insured group shall pay all workers
compensation benefits required under KRS Chapter 342 for which each
member incurs liability during its period of membership, including assessments.
A member who elects to withdraw its membership or is terminated by a group
remains liable for workers
compensation liabilities, obligations, and
assessments during the terminated or withdrawn group members period of
membership. A group member shall not be relieved of its workers
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compensation liabilities incurred, including assessments, during its period of
membership, except through payment by the group or the member of these
liabilities.
The insolvency or bankruptcy of a group member shall not relieve the workers
compensation self-insured group or any group member of liability for the
payment of workers compensation benefits incurred during the insolvent or
bankrupt group member's period of membership.
Effective:July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1638, effective July 15, 2010. -Created 2005 Ky. Acts ch. 7, sec. 18, effective March 1, 2005.
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