California Labor Code

§ 3701.5

LAB § 3701.5 Effective Jan 1, 2013Div. 4 · Part 1 · Ch. 4 · Art. 1

Statute text

(a)If the director determines that a private self-insured employer has failed to pay workers’ compensation as required by this division, the security deposit shall be utilized to administer and pay the employer’s compensation obligations.

(b)If the director determines the security deposit has not been immediately made available for the payment of compensation, the director shall determine the method of payment and claims administration as appropriate, which may include, but is not limited to, payment by a surety that issued the bond, or payment by an issuer of an irrevocable letter of credit, and administration by a surety or by an adjusting agency, or through the Self-Insurers’ Security Fund, or any combination thereof. If the director arranges for administration and payment by any person other than the Self-Insurers’ Security Fund after a default is declared, the fund shall have no responsibility for claims administration or payment of the claims.

(c)If the director determines the payment of benefits and claims administration shall be made through the Self-Insurers’ Security Fund, the fund shall commence payment of the private self-insured employer’s obligations for which it is liable under Section 3743 within 30 days of notification. Payments shall be made to claimants whose entitlement to benefits can be ascertained by the fund, with or without proceedings before the appeals board. Upon the assumption of obligations by the fund pursuant to the director’s determination, the fund shall have a right to immediate possession of any posted security and the custodian, surety, or issuer of any irrevocable letter of credit shall turn over the security to the fund together with the interest that has accrued since the date of the self-insured employer’s default or insolvency.

…

Legislative history

Amended by Stats. 2012, Ch. 363, Sec. 13. (SB 863) Effective January 1, 2013.