Maryland Insurance Section 25-303

Article - Insurance

§ 25-303.

      (a)      In this section, "service company" means a person that provides services that are not provided by the administrator, including:

            (1)      claims adjustment;

            (2)      safety engineering;

            (3)      compilation of statistics and the preparation of premium, loss, and tax reports;

            (4)      preparation of other required self-insurance reports;

            (5)      development of members' assessments and fees; and

            (6)      administration of a claim fund.

      (b)      The Commissioner shall adopt regulations to carry out this subtitle.

      (c)      The regulations shall include:

            (1)      classifications of businesses and industries, based on the type of activity conducted by the business or industry, within which employers may join together in self-insurance groups;

            (2)      for each classification:

                  (i)      a minimum level of contribution of at least $250,000 in premiums collected from or pledged by members of a self-insurance group to a fund from which workers' compensation claims will be paid;

                  (ii)      a minimum level of excess insurance coverage that must be obtained by each self-insurance group;

                  (iii)      a requirement that the minimum levels of excess insurance adopted under this subtitle may be satisfied by placing, in a depository that the Commissioner designates, securities in a form and amount that the Commissioner requires; and

                  (iv)      a surety bond of at least $100,000 that must be obtained by each self-insurance group;

            (3)      conditions under which contributions by members of a self-insurance group may be rebated or temporarily suspended;

            (4)      for each administrator or service company, a bond that the Commissioner may require in addition to any other required bond; and

            (5)      a requirement that the governance of the group be under the control of its members.