ENGROSSED
H. B. 501
(By Mr. Speaker, Mr. Kiss, and Delegate Trump)
[By Request of the Executive]
[Introduced November 13, 2005.]
A BILL to amend and reenact §23-2C-1, §23-2C-2,§23-2C-4, §23-2C-7,
§23-2C-8,§23-2C-15, §23-2C-16 and §23-2C-20 of the Code of
West Virginia, 1931, as amended; to further amend said code by
adding thereto a new section, designated §23-2C-3a; and to
amend and reenact §23-4B-1, §23-4B-2, §23-4B-3, §23-4B-4, §23-
4B-5, §23-4B-7 and §23-4B-9 of said code, all relating to the
transition of the workers' compensation commission to the West
Virginia Employers' Mutual Insurance Company generally.
Be it enacted by the Legislature of West Virginia:
That §23-2C-1, §23-2C-2, §23-2C-4, §23-2C-7, §23-2C-8, §23-2C-
15, §23-2C-16 and §23-2C-20 of the Code of West Virginia, 1931, as
amended, be amended and reenacted; that the code be amended by
adding thereto a new section, designated §23-2C-3a; and that §23-
4B-1, §23-4B-2, §23-4B-3, §23-4B-4, §23-4B-5, §23-4B-7 and §23-4B-9
of the code be amended and reenacted, all to read as follows:
ARTICLE 2C. EMPLOYERS' MUTUAL INSURANCE COMPANY.
§23-2C-1. Findings and purpose.
(a) The Legislature finds that:
(1) There is a long-term actuarial funding crisis in the
state-run monopolistic workers' compensation system;
(2) Similar short-term and long-term crises have been ongoing
during the past two decades;
(3) During the current crisis, employers in West Virginia find
it increasingly difficult to afford the rates charged by the
Workers' Compensation Commission for workers' compensation coverage
and that paying said rates adversely impacts employers' ability to
compete in a global economic environment;
(4) The cost of obtaining workers' compensation coverage from
the state system may result in many employers leaving the state;
(5) Employers' access to competitive workers' compensation
rates and the resulting economic development benefit is of utmost
importance to the citizens of West Virginia;
(6) A mechanism is needed to provide an enduring solution to
this recurring workers' compensation crisis;
(7) An employers' mutual insurance company or a similar entity
has proven to be a successful mechanism in other states for helping
employers secure insurance and for stabilizing the insurance
market;
(8) There is a substantial public interest in creating a
method to provide a stable workers' compensation insurance market
in this state;
(9) The state-run workers' compensation program is a substantial actual and potential liability to the state;
(10) There is substantial public benefit in transferring
certain actual and potential future liability of the state to the
private sector and creating a stable self-sufficient entity which
will be a potential source of workers' compensation coverage for
employers in this state;
(11) A stable, financially viable insurer in the private
sector will aid in providing a continuing source of insurance funds
to compensate injured workers; and
(12) Because the public will greatly benefit from the
formation of an employers' mutual insurance company, state efforts
to encourage and support the formation of such an entity, including
providing funding for the entity's initial capital, is in the clear
public interest.
(b) The purpose of this article is to create a mechanism for
the formation of an employers' mutual insurance company that will
provide:
(1) A means for employers to obtain workers' compensation
insurance that is reasonably available and affordable; and
(2) Compensation to employees of mutual policyholders who
suffer work place injuries as defined in this chapter.
(c) The further purpose of this article is to transfer New
Fund assets relating to the workers' compensation insurance
business to the company, including a reasonable level of
policyholder surplus, and for the company to assume the New Fund
liabilities related to the transferred assets. It is the intent of this article to provide for the initial capitalization of the
company to comply with and to meet the requirements of section 351
and related sections of the Internal Revenue Code.
§23-2C-2. Definitions.
(a) "Executive Director" means the Executive Director of the
West Virginia Workers' Compensation Commission as provided in
section one-b, article one of this chapter.
(b) "Commission" means the West Virginia Workers' Compensation
Commission as provided by section one, article one of this chapter.
(c) "Insurance Commissioner" means the Insurance Commissioner
of West Virginia as provided in section one, article two, chapter
thirty-three of this code.
(d) "Company" or "successor to the Commission" means the
Employers' Mutual Insurance Company created pursuant to the terms
of this article.
(e) "Policy default" shall mean a policyholder that has failed
to comply with the terms of its workers' compensation insurance
policy and is consequently without workers' compensation insurance
coverage.
(f) "Industrial insurance" means insurance which provides all
compensation and benefits required by this chapter.
(g) "Insurer" includes:
(1) A self-insured employer; and
(2) A private carrier.
(h) "Industrial Council" means the advisory group established
in section five of this article.
(i) "Mutualization Transition Fund" shall be a fund over which
the State Treasurer is custodian. Moneys transferred or otherwise
payable to the Mutualization Transition Fund shall be deposited in
the State Treasury to the credit of the Mutualization Transition
Fund. Disbursements shall be made from the Mutualization
Transition Fund upon requisitions signed by the Executive Director,
and, upon termination of the Commission, the Insurance
Commissioner, and shall be reasonably related to the legal,
operational, consultative and human resource related expenses
associated with the establishment of the company and the
transferring of personnel from the Commission to the company.
(j) "New Fund" shall mean a fund owned and operated by the
Commission and, upon termination of the Commission, the successor
organization of the West Virginia Workers' Compensation Commission
and shall consist of those funds transferred to it from the
Workers' Compensation Fund and any other applicable funds. New
Fund shall include all moneys due and payable to the Workers'
Compensation Fund for the quarters ending the thirtieth day of
September, two thousand five, and the thirty-first day of December,
two thousand five, which have not been collected by the Workers'
Compensation Fund as of the thirty-first day of December, two
thousand five.
(k) "New Fund liabilities" shall mean all claims payment
obligations (indemnity and medical expenses) for all claims, actual
and incurred but not reported, for any claim with a date of injury
or last exposure on or after the first day of July, two thousand five: Provided, That New Fund liabilities shall begin with claims
payments becoming due and owing on said claims on or after the
first day of January, two thousand six.
(l) "Old Fund" shall mean a fund held by the State Treasurer's
office consisting of those funds transferred to it from the
Workers' Compensation Fund or other sources and those funds due and
owing the Workers' Compensation Fund as of the thirtieth day of
June, two thousand five, that are thereafter collected. The Old
Fund and assets therein shall remain property of the state and
shall not novate or otherwise transfer to the company.
(m) "Old Fund liabilities" mean all claims payment obligations
(indemnity and medical expenses), related liabilities and
appropriate administrative expenses necessary for the
administration of all claims, actual and incurred but not reported,
for any claim with a date of injury or last exposure on or before
the thirtieth day of June, two thousand five: Provided, That Old
Fund liabilities shall include all claims payments for any claim,
regardless of date of injury or last exposure, through the thirty-
first day of December, two thousand five: Provided, however, That
Old Fund liabilities shall include all claims with dates of
injuries or last exposure prior to the first day of July, two
thousand four, for bankrupt self-insured employers that had
defaulted on their claims obligations which have been recognized by
the Commission in its actuarially determined liability number as of
the thirtieth day of June, two thousand five.
(n) "Private carrier" means any insurer or the legal representative of an insurer authorized by the Insurance
Commissioner to provide workers' compensation insurance pursuant to
this chapter and which maintains an office in the state. The term
does not include a self-insured employer or private employers but
shall include any successor to the Commission.
(o) "Uninsured Employer Fund" means a fund held by the State
Treasurer's office consisting of those funds transferred to it from
the Workers' Compensation Fund and any other source. Disbursements
from the Uninsured Employer Fund shall be upon requisitions signed
by the Insurance Commissioner and the administrator of the fund,
and as otherwise set forth in an exempt legislative rule
promulgated by the Workers' Compensation Board of Managers.
(p) "Self-Insured Employer Guaranty Risk Pool" shall be a fund
held by the State Treasurer's office consisting of those funds
transferred to it from the guaranty pool created pursuant to 85 CSR
§19 (2004) and any future funds collected through continued
administration of that exempt legislative rule as administered by
the Insurance Commissioner. Disbursements shall be made from the
Self-Insured Employer Guaranty Risk Pool upon requisitions signed
by the Insurance Commissioner and the administrator of the fund.
The obligations of the fund shall be as provided in 85 CSR §19
(2004). The company shall administer the self-insured employer
guaranty risk pool for a term and administrative fee as provided in
the administration of the old fund.
(q) "Self-Insured Employer Security Risk Pool" shall be a fund
held by the State's Treasurer consisting of those funds paid into it through the Insurance Commissioner's administration of 85 CSR
§19 (2004). Disbursement from said fund shall be made from the
Self-Insured Employer Security Risk Pool upon requisitions signed
by the Insurance Commissioner and the administrator of the fund.
The obligations of the fund shall be as provided in 85 CSR §19:
Provided, That said liabilities shall be limited to those self-
insured employers who default on their claims obligations after the
termination of the Commission. The company shall administer the
self-insured employer security risk pool for a term and
administrative fee as provided in the administration of the old
fund.
(r) "Private Carrier Guaranty Fund" shall be a fund held by
the State Treasurer's office consisting of funds deposited pursuant
to this article. Disbursements shall be made from the Private
Carrier Guaranty Fund upon requisitions signed by the Insurance
Commissioner and the administrator of the fund. The obligations of
the fund shall be as provided in this article. The company shall
administer the private carrier guaranty fund for a term and
administrative fee as provided in the administration of the old
fund.
(s) "Assigned Risk Fund" shall be a fund held by the State
Treasurer's office consisting of funds deposited pursuant to this
article. Disbursements shall be made from the Assigned Risk Fund
upon requisitions signed by the Insurance Commissioner. The
obligations of the fund shall be as provided in this article.
(t) "Comprehensive financial plan" shall mean the plan compiled by the director for acceptance by the Insurance
Commissioner identifying and forecasting cash flows, funding
sources, debt terms and structures, and scheduled amortization and
permanent resolution of all Old Fund liabilities. The
comprehensive financial plan shall provide for the retirement of
the revenue bonds authorized by article two-d of this chapter and
all realized and potential claims against the Old Fund shall be
fully reserved. The comprehensive financial plan may include any
other information the Insurance Commissioner may require as a basis
for managing the post-transition fiscal soundness of the Old Fund.
§23-2C-3a. Employers' Mutual Insurance Company - additional
provisions enacted in November 2005.
(a) Notwithstanding any other provisions of this article to
the contrary, the Employers' Mutual Insurance Company:
(1) May not be dissolved.
(2) May not transact such other kinds of property and casualty
insurance for which the company is otherwise qualified under the
provisions of this code prior to the first day of January, two
thousand nine.
(b) As soon as practical following the effective date of this
section, the company established pursuant to the provisions of this
article shall, through a vote of a majority of its provisional
board, file its amended articles of incorporation and amended
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.
(c) Notwithstanding any provision of subsection (g), section
three of this article to the contrary, in the event the governor
certifies to the Legislature that revenue bonds issued pursuant to
article two-d of this chapter 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, then:
(1) The premiums surcharge imposed by subdivision (2),
subsection (f), section three of this article shall not sunset and
shall continue to be remitted in accordance with the provisions of
said subsection; and
(2) The premiums surcharge imposed by subdivision (3),
subsection (f), section three of this article 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 makes the
certification.
(d) Except as may otherwise be provided in this subsection,
all provisions of section three of this article shall remain in
full force and effect.
§23-2C-4. Governance and organization.
(a) (1) The Commission shall implement the initial formation
and organization of the company as provided by this article.
(2) From the inception of the company, until the first day of
January, two thousand six, the company shall be governed by a provisional board of directors consisting of the three-persons on
the Executive Committee of the Workers' Compensation Board of
Managers and four members of the Legislature. Two members of the
West Virginia Senate and two members of the West Virginia House of
Delegates shall serve as advisory nonvoting members of the board.
The Governor shall appoint the legislative members to the board.
No more than three of the legislative members shall be of the same
political party. The provisional board shall have the authority to
function as necessary to establish the company and cause it to
become operational, including the right to contract on behalf of
the company. Each voting board member shall receive compensation
of not more than three hundred fifty dollars per day and actual and
necessary expenses for each day during which he or she is required
to and does attend a meeting of the board.
(3) The provisional board shall develop procedures for the
nomination of the board of directors that will succeed the
provisional board on the first day of January, two thousand six,
and for the conduct of the election, to be held no later than the
first day of November, two thousand five, and shall give notice of
the election to the current subscribers to the workers'
compensation fund. These procedures shall be exempt from the
provisions of article three, chapter twenty-nine-a of this code.
(4) (3) Except as limited by this section and applicable
insurance rules and statutes, the company may: (1) On its own; (2)
through the formation or acquisition of subsidiaries; or (3)
through a joint enterprise, offer:
(A) Workers' compensation insurance in a state other than West
Virginia to the extent it also provides workers' compensation or
occupational disease insurance coverage to the employer pursuant to
this chapter;
(B) Other workers' compensation products and services and
related products and services in West Virginia or other states; and
(C) Other property and casualty insurance in West Virginia and
other states on or after the first day of January, two thousand
nine.
(b) Any election process for the board of directors developed,
implemented and overseen by the company's provisional board prior
to the effective date of the amendments to this section enacted
during the fifth extraordinary session of the Legislature in two
thousand five, is nullified and the designation of the company's
initial board of directors shall be governed by the following:
Effective the first day of January, two thousand six, the company
shall be governed by a Board of Directors consisting of seven
directors, as follows:
(1) Three owners or officers of an entity that has purchased
or will immediately upon termination of the Commission purchase and
maintain an active workers' compensation insurance policy from the
company. At least one shall be a certified public accountant with
financial management or pension or insurance audit expertise and at
least one shall be an attorney with financial management
experience. These three directors shall be appointed by the
Governor.
(2) Two directors who have substantial experience as an
officer or employee of a company in the insurance industry, one of
whom is from a company with less than fifty employees;. These two
directors shall be appointed by the Governor.
(3) One director with general knowledge and experience in
business management who is an officer and employee of the company
and is responsible for the daily management of the company; and.
(4) The chief executive officer of the company.
(c) The directors and officers of the company are to be chosen
in accordance with the articles of incorporation and bylaws of the
company. The initial board of directors selected appointed by the
Governor shall serve for the following terms: (1) Two for four-year
terms; (2) two for three-year terms; (3) two for two-year terms;
and (4) one for a one-year term. Thereafter, the directors shall
serve staggered terms of four years. No director chosen may serve
more than two consecutive terms, except for the chief executive
officer of the company. from the termination of the Commission
through the thirty-first day of December, two thousand eight, and
may be not removed from that position except for cause.
(d) Any board vacancy that occurs from the termination of the
Commission through the thirty-first day of December, two thousand
eight, shall be filled through appointment by the Governor for the
unexpired term.
(e) Upon expiration of the initial terms or upon a vacancy of
the board following the thirty-first day of December, two thousand
eight, the directors of the company are to be chosen in accordance with the articles of incorporation and bylaws of the company, as
amended, which shall provide for the policyholders to nominate and
elect future directors. Furthermore, owners, directors or
employees of employers otherwise licensed to write workers'
compensation insurance in this state or licensed or otherwise
authorized to act as a third-party administrator shall not be
eligible to be nominated, appointed, elected or serve on the
company's board of directors.
(d) (f) The Executive Director shall prepare and file amended
articles of incorporation and bylaws in accordance with the
provisions of this article and the provisions of chapters thirty-
one and thirty-three of this code.
(g) It is the intent of this legislation to create an entity
exempt from federal taxation, as provided for in Internal Revenue
Code Section 501(c)(27)(B), for as long as the company meets the
federal qualification requirements of Section 501(c)(27)(B) of the
Internal Revenue Code.
§23-2C-7 Custody, investment and disbursement of funds.
(a) The State Treasurer shall be the custodian of the Workers'
Compensation Old Fund, Workers' Compensation Uninsured Employers'
Fund, the Self-Insured Employer Guaranty Risk Pool, the Self-
Insured Employer Security Risk Pool, the Private Carrier Guaranty
Fund and the Assigned Risk Pool and moneys payable to each of these
funds shall be deposited in the State Treasury to the credit of the
funds. Each fund shall be a separate and distinct fund upon the
books and records of the Auditor and Treasurer. Disbursements from these funds shall be made upon requisitions signed by the executive
director and, effective upon termination of the commission, the
administrator of the funds and the Insurance Commissioner. The
Workers' Compensation Old Fund, the Workers' Compensation Uninsured
Employer Fund, the Self-Insured Employer Guaranty Risk Pool, Self-
Insured Employer Security Risk Pool, the Private Carrier Guaranty
Fund and the Assigned Risk Fund are participant plans as defined in
section two, article six, chapter twelve of this code and are
subject to the provisions of section nine-a of said article. The
funds may be invested by the Investment Management Board in
accordance with said article.
(b) If the Governor issues the proclamation set forth in this
article, then, effective upon termination of the commission, all
remaining assets and funds contained in the Workers' Compensation
Fund which are payable to the New Fund shall be so disbursed and
paid to the company by communication of the executive director to
the State Treasurer or other appropriate state official prior to
the termination of the commission.
§23-2C-8. West Virginia uninsured employers' fund.
(a) The West Virginia uninsured employers' fund shall be
governed by the following:
(1) All money and securities in the fund must be held by the
State Treasurer as custodian thereof to be used solely as provided
in this article.
(2) The State Treasurer may disburse money from the fund only
upon written requisition of the Insurance Commissioner and administrator of the fund.
(3) The Insurance Commissioner shall assess each private
carrier and all self-insured employers an amount to be deposited in
the fund. The assessment may be collected by each private carrier
from its policy holders in the form of a policy surcharge. To
establish the amount of the assessment, the Insurance Commissioner
shall determine the amount of money necessary to maintain an
appropriate balance in the fund for each fiscal year and shall
allocate a portion of that amount to be payable by private
carriers, a portion to be payable by self-insured employers, and a
portion to be paid by any other appropriate group. After
allocating the amounts payable, the Insurance Commissioner shall
apply an assessment rate to the:
(A) Private carriers that reflects the relative hazard of the
employments covered by the private carriers, results in an
equitable distribution of costs among the private carriers and is
based upon expected annual premiums to be received;
(B) Self-insured employers that results in an equitable
distribution of costs among the self-insured employers and is based
upon expected annual expenditures for claims; and
(C) Any other categories of payees that results in an
equitable distribution of costs among them and is based upon
expected annual expenditures for claims or premium to be received.
(4) The Workers' Compensation Board of Managers may adopt
rules for the establishment and administration of the assessment
methodologies, rates, payments and any penalties that the Workers' Compensation Board of Managers determines are necessary to carry
out the provisions of this section.
(b) Payments from the fund shall be governed by the following:
(1) Except as otherwise provided in this subsection, an
injured worker of any employer required to be covered under this
chapter who has failed to obtain coverage may receive compensation
from the uninsured employers' fund if:
(A) He or she meets all jurisdictional and entitlement
provisions of this chapter;
(B) He or she files a claim with the Insurance Commissioner;
and
(C) He or she makes an irrevocable assignment to the Insurance
Commissioner a right to be subrogated to the rights of the injured
employee.
(2) If the Insurance Commissioner receives a claim, it shall
immediately notify the employer of the claim. For the purposes of
this section, the employer has the burden of proving that it
provided mandatory workers' compensation insurance coverage for the
employee or that it was not required to maintain workers'
compensation insurance for the employee. If the employer meets
this burden, benefits shall not be paid from the fund.
(3) Any employer who has failed to provide mandatory coverage
required by the provisions of chapter twenty-three of this code is
liable for all payments made on its behalf, including any benefits,
administrative costs and attorney's fees paid from the fund or
incurred by the Insurance Commissioner.
(4) The Insurance Commissioner:
(A) May recover from the employer the payments made by it, any
accrued interest and attorney fees and costs by bringing a civil
action in a court of competent jurisdiction.
(B) May enter into a contract with any person, including the
third party administrator of the uninsured employers' fund, to
assist in the collection of any liability of an uninsured employer.
(C) In lieu of a civil action, may enter into an agreement or
settlement regarding the collection of any liability of an
uninsured employer.
(5) The Insurance Commissioner shall:
(A) Determine whether the employer was insured within five
days after receiving notice of the claim from the employee.
(B) Assign the claim to the third party administrator of the
fund for administration and, if appropriate, payment of
compensation.
(6) Upon determining whether the claim is accepted or denied,
the fund third party administrator shall notify the injured
employee and the named employer of its determination.
(7) Any party aggrieved by a determination made by the
Insurance Commissioner or the fund third party administrator
regarding the claims decisions made pursuant to this section may
appeal that determination by filing a protest with the Office of
Judges as set forth in article five of this chapter.
(8) An uninsured employer is liable for the interest on any
amount paid on his or her claims from the fund. The interest must be calculated at a rate set in accordance with the provisions of
section thirteen, article two of this chapter, compounded monthly,
from the date the claim is paid from the account until payment is
received by the Insurance Commissioner or fund third party
administrator from the employer.
(9) Attorney's fees recoverable by the Insurance Commissioner
or third party administrator pursuant to this section must be paid
at the usual and customary rate for that attorney.
(10) In addition to any other liabilities provided in this
section, the Insurance Commissioner or the fund third party
administrator may impose an administrative fine of not more than
ten thousand dollars against an employer if the employer fails to
provide mandatory coverage required by this chapter. All fines and
other moneys collected pursuant to this section shall be deposited
into the uninsured employer fund.
(c) The company shall be the administrator of the uninsured
employers' fund from the fund's inception and thereafter for seven
years and shall be charged with all authority and responsibilities
incidental to the administration of the fund which are necessary to
accomplish the express provisions and the intent of this chapter.
The company shall be paid a monthly administrative fee of five
percent of claims paid each month for the administration of the
fund through the thirty-first day of December, two thousand ten,
and four percent of claims paid each month for the administration
of the fund thereafter through the thirty-first day of December,
two thousand twelve. The company's administrative duties shall include, but not be limited to, receipt of all claims, processing
said claims, providing for the payment of said claims through the
state treasurer's office or other applicable state agency and
ensuring, through the selection and assignment of counsel, that
claims decisions are properly defended. The administration of the
fund after this seven year period shall be subject to the
procedures set forth in article three, chapter five-a of this code.
(d) (c) Employees of self-insured employers who are injured
while employed by a self-insured employer are ineligible for
benefits from the West Virginia uninsured employer fund.
§23-2C-15. Mandatory coverage; changing of coverage.
(a) Effective upon termination of the commission, all
subscriber policies with the commission shall novate to the company
and all employers otherwise shall purchase workers' compensation
insurance from the company, unless permitted to self-insure their
obligations. The company shall assume responsibility for all New
Fund obligations of the subscriber policies which novate to the
company or which are issued thereafter. Each subscriber whose
policy novates to the company shall also have its advanced deposit
credited to its account with the company. Employers purchasing
workers' compensation insurance from the company shall have the
right to designate a representative or agent to act on its behalf
in any and all matters relevant to coverage and claims as
administered by the company.
(b) Effective the first day of July, two thousand eight, an
employer may elect to: (1) Continue to purchase workers' compensation insurance from the company; (2) purchase workers'
compensation insurance from another private carrier licensed and
otherwise authorized to transact workers' compensation insurance in
this state; or (3) self-insure its obligations if it satisfies all
requirements of this code to so self-insure and is permitted to do
so: Provided, That all state and local governmental bodies,
including, but not limited to, all counties and municipalities and
their subdivisions and including all boards, colleges, universities
and schools, shall continue to purchase workers' compensation
insurance from the company through the thirtieth day of June, two
thousand twelve. The company and other private carriers shall be
permitted to sell workers' compensation insurance through licensed
agents in the state. To the extent that a private carrier markets
workers' compensation insurance through a licensed agent, it shall
be subject to all applicable provisions of chapter thirty-three of
the code. All employers' must immediately notify the Insurance
Commissioner of its private carrier and any change thereto.
(c) An employer may elect to change its private insurer
carrier on or after the first day of July, two thousand eight, if
the employer has:
(1) Given at least thirty days' notice to the Insurance
Commissioner of the change of insurer; and
(2) Furnished evidence satisfactory to the Insurance
Commissioner that the payment of compensation has otherwise been
secured.
(d) Each private carrier and employer shall notify the Insurance Commissioner if an employer has changed his or her
insurer or has allowed his or her insurance to lapse within twenty-
four hours or by the end of the next working day, whichever is
later, after the insurer has notice of the change or lapse. Every
employer shall post a notice upon its premises in a conspicuous
place identifying its industrial insurer. The notice must include
the insurer's name, business address and telephone number and the
name, business address and telephone number of its nearest adjuster
in this state. The employer shall at all times maintain the notice
provided for the information of his or her employees. Release of
employer policy information and status by the industrial council
and the Insurance Commissioner shall be governed by section four,
article one, chapter twenty-three of this code. The Insurance
Commissioner shall collect and maintain information related to
officers, directors and ten percent or more owners of each
carrier's policy holders. The private carrier shall provide said
information to the Insurance Commissioner.
(e) Any rule promulgated by the Workers' Compensation Board of
Managers empowering agencies of this state to revoke or refuse to
grant, issue or renew any contract, license, permit, certificate or
other authority to conduct a trade, profession or business to or
with any employer whose account is in default with the commission
shall be fully enforceable by the Insurance Commissioner against
the employer in policy default with a private carrier.
(f) Effective the first day of July, two thousand eight
January, two thousand nine, the company may decline to offer coverage to any applicant. Effective the first day of July, two
thousand eight January, two thousand nine, the company and private
carriers may cancel a policy or decline to renew a policy upon the
issuance of sixty days written advance notice to the policyholder:
Provided, That cancellation of the policy by the carrier for
failure of consideration to be paid by the policyholder is
effective after fifteen days advance written notice of cancellation
to the policyholder.
§23-2C-16 Administration of Old Fund, Uninsured Employer Fund,
Self-Insured Employer Guaranty Risk Pool, Self-
Insured Employer Security Risk Pool, and Private
Carrier Guaranty Fund.
Notwithstanding any provision of this code to the contrary,
the company shall be the initial third party administrator of the
workers' compensation Old Fund, uninsured employer fund, Self-
Insured Employer Guaranty Risk Pool, Self-Insured Employer Security
Risk Pool, and Private Carrier Guaranty Fund from inception of the
company the termination of the commission and thereafter for a term
of at least six months but not more than three years seven years
pursuant to an agreement to be entered into between the Insurance
Commissioner and the company prior to the termination of the
commission. and shall be charged with all authority and
responsibilities incidental to the administration of the old fund
which are necessary to accomplish the express provisions and the
intent of this chapter. The company shall be paid a monthly administrative fee of five percent of claims paid each month for
the administration of the old fund through the thirty-first day of
December, two thousand ten, and four percent of claims paid each
month for the administration of the old fund thereafter through the
thirty-first day of December, two thousand twelve reasonable fee
for services provided. The company's administrative duties shall
may include, but not be limited to, receipt of all claims,
processing said claims, providing for the payment of said claims
through the State Treasurer's office or other applicable state
agency, and ensuring, through the selection and assignment of
counsel, that claims decisions are properly defended. The
administration of the old fund said funds thereafter after this
seven-year period shall be subject to the procedures set forth in
article three, chapter five-a of this code.
(b) The insurance commissioner may contract or employ counsel
to perform legal services related solely to the collection of
moneys due the old fund, including the collection of moneys due the
old fund and enforcement of repayment agreements entered into for
the collection of moneys due on or before the thirtieth day of
June, two thousand five, in any administrative proceeding and in
any state or federal court.
(c) (b) The Insurance Commissioner shall review claims
determined to be payable from the old fund said funds and may
contest the determination pursuant to the provisions of article
five of this chapter.
(d) (c) The Insurance Commissioner may conduct or cause to be conducted an annual audit to be performed on the old funds said
funds.
(d) The Insurance Commissioner may contract or employ counsel
to perform legal services related solely to the collection of
moneys due the Old Fund, including the collection of moneys due the
Old Fund and enforcement of repayment agreements entered into for
the collection of moneys due on or before the thirtieth day of
June, two thousand five, in any administrative proceeding and in
any state or federal court.
§23-2C-20. Claims administration issues.
(a) A self-insured employer shall continue to comply with
rules promulgated by the board of managers governing the self-
administration of its claims and the successor to the commission
shall also comply with the rules promulgated by the board of
managers governing the self-administration of claims.
(b) The successor to the commission, any other private carrier
and any employer that self-insures its risk and self-administers
its claims shall exercise all authority and responsibility granted
to the commission in this chapter and provide notices of action
taken to effect the purposes of this chapter to provide benefits to
persons who have suffered injuries or diseases covered by this
chapter. The successor to the commission, private carriers and
self-insured employers shall at all times be bound and shall comply
fully with all of the provisions of this chapter. Furthermore, all
of the provisions contained in article four of this chapter
pertaining to disability and death benefits are binding on and shall be strictly adhered to by the successor to the commission,
private carriers, and the self-insured employer in their
administration of claims presented by employees of the self-insured
employer.
(c) Upon termination of the commission, the occupational
pneumoconiosis board shall be transferred to the Insurance
Commissioner and shall be administered by the Insurance
Commissioner. The company and other private carriers shall have
all authority and responsibility granted to the self-insured
employers in the administration and processing of occupational
pneumoconiosis claims.
(d) Upon termination of the commission, all claims allocation
responsibilities shall transfer from the commission to the
Insurance Commissioner.
(e) Upon termination of the commission, the third party
administrator of the Old Fund shall have all administrative and
adjudicatory authority vested in the commission in administering
old law liabilities and otherwise processing and deciding old law
claims.
ARTICLE 4B. COAL-WORKERS' PNEUMOCONIOSIS FUND.
§23-4B-1. Purpose.
The purpose of this article is to establish a fund to provide
benefits to coal miners who are totally disabled by pneumoconiosis
and to eligible dependents of coal miners whose deaths were due to
pneumoconiosis or who were totally disabled from pneumoconiosis at
time of their deaths. The further purpose of this article is to provide a readily available insurer of liability created by Title
IV of the Federal Coal Mine Health and Safety Act of 1969, as
amended, for claims incurred under said Act, including claims which
were incurred but not reported, for any claim with a date of last
exposure on or before the thirty-first day of December, two
thousand five.
§23-4B-2. Coal-Workers' Pneumoconiosis Fund established.
For the relief of persons who are entitled to receive benefits
by virtue of Title IV of the federal Coal Mine Health and Safety
Act of 1969, as amended, for claims incurred under said Act,
including claims which were incurred but not reported, for any
claim with a date of last exposure on or before the thirty-first
day of December, two thousand five, there is continued a fund to be
known as the Coal-Workers' Pneumoconiosis fund, which fund shall be
separate from the workers' compensation fund. The Coal-Workers'
Pneumoconiosis Fund shall consist of premiums and other funds paid
to the fund by employers, subject to the provisions of Title IV of
the federal Coal Mine Health and Safety Act of 1969, as amended,
who shall elect to subscribe to the fund to ensure the payment of
benefits required by the act for claims incurred under said Act,
including claims which were incurred but not reported, for any
claim with a date of last exposure on or before the thirty-first
day of December, two thousand five.
The state treasurer shall be the custodian of the
Coal-Workers' Pneumoconiosis Fund, and all premiums, deposits or
other moneys paid to the fund shall be deposited in the state treasury to the credit of the Coal-Workers' Pneumoconiosis Fund.
Disbursements from the fund shall be made upon requisition signed
by the Executive Director of the Workers' Compensation Commission
to those persons entitled to participate in the fund: Provided,
That effective upon the termination of the Workers' Compensation
Commission, disbursement from the Coal-workers' Pneumoconiosis Fund
shall be made upon requisitions signed by the Insurance
Commissioner and the Insurance Commissioner shall collect any
unpaid premium and deposit the same in said fund. The West
Virginia state board of investments Investment Management Board may
invest any surplus, reserve or other moneys belonging to the
Coal-Workers' Pneumoconiosis Fund in accordance with article six,
chapter twelve of this code.
§23-4B-3. To whom benefits paid.
Only those classes of persons who are entitled to benefits
under Title IV of the Federal Coal Mine Health and Safety Act of
1969, as amended, for claims incurred under said Act, including
claims which were incurred but not reported, for any claim with a
date of last exposure on or before the thirty-first day of
December, two thousand five, are eligible to participate in the
Coal-Workers' Pneumoconiosis fund.
§23-4B-4. Who may subscribe.
Only those employers who are subject to the provisions of
Title IV of the Federal Coal Mine Health and Safety Act of 1969, as
amended, may elect to subscribe to the Coal-Workers' Pneumoconiosis
Fund to insure such liability as may be imposed upon such employers under the provisions of Title IV of said act. Coverage by the
Coal-workers' Pneumoconiosis Fund will be provided only for claims
incurred under said Act, including claims which were incurred but
not reported, for any claim with a date of last exposure on or
before the thirty-first day of December, two thousand five.
§23-4B-5. Payment of benefits.
Upon receipt of an order of compensation issued pursuant to a
claim for benefits filed under the provisions of Title IV of the
federal Coal Mine Health and Safety Act of 1969, as amended, for a
claim incurred with a date of last exposure on or before the
thirty-first day of December, two thousand five, the executive
director shall disburse the Coal-Workers' Pneumoconiosis Fund in
the amounts and to the persons as directed by the order: Provided,
That effective upon the termination of the Workers' Compensation
Commission, disbursement from the Coal-workers' Pneumoconiosis Fund
shall be made upon requisitions signed by the Insurance
Commissioner.
§23-4B-7. Administration.
(a) The Coal-Workers' Pneumoconiosis fund shall be
administered by the Executive Director of the Workers' Compensation
Commission, who shall employ any employees necessary to discharge
his or her duties and responsibilities under this article. All
payments of salaries and expenses of the employees and all expenses
peculiar to the administration of this article shall be made by the
state treasurer from the Coal-Workers' Pneumoconiosis fund upon
requisitions signed by the Executive Director.
(b) Notwithstanding any provision of this code to the
contrary, effective from the termination of the Workers'
Compensation Commission, the Coal-Workers' Pneumoconiosis Fund
shall be administered by the Insurance Commissioner, who shall
employ any employees and contract with any parties necessary to
discharge his or her duties and responsibilities under this
article. All payments of salaries and expenses of the employees
and all expenses peculiar to the administration of this article
shall be made by the state treasurer from the Coal-workers'
Pneumoconiosis Fund upon requisitions signed by the Insurance
Commissioner: Provided, That the company shall be the
administrator of the coal-workers' pneumoconiosis fund for a term
not to exceed three years following the termination of the Workers'
Compensation Commission pursuant to an agreement to be entered into
between the Insurance Commission and the Company prior to the
termination of the Workers' Compensation Commission: Provided
further, That any contract entered into by the Insurance Commission
for the administration of the Coal-workers' pneumoconiosis fund
thereafter shall be subject to the procedures set forth in article
three chapter five-a of this code.
§23-4B-9. Closure of Coal-Workers Pneumoconiosis Fund and Coverage
provided by the successor of the commission.
Upon the termination of the Commission, all assets,
obligations and liabilities resulting from this article are
transferred to the successor of the commission. The state treasurer and all other departments, agencies and boards shall
cooperate to ensure this novation occurs in a expedient and orderly
fashion. Thereafter, the Coal-workers Pneumoconiosis Fund shall
close and the company shall offer insurance to provide for the
benefits required by this article until at least the thirtieth day
of June thirty-first day of December, two thousand eight. All
claims payment obligations and indemnity and medical administrative
expenses necessary for the administration of claims, actual and
incurred but not reported, for any claim with a date of last
exposure on or before the thirty-first day of December, two
thousand five, shall be an obligation of the Coal-Workers'
Pneumoconiosis Fund created in this article and not of the company.