Assessment-Deposit Procedures for Individual Self-Insured Workers Compensation
All individual licensed self-insurers are required to participate in the Association Aggregate Security System (AASS) unless excluded by the Board of Directors of the Self-Insurance Security Association (SISA) pursuant to NCGS §97-185 (a1). Under the AASS, each self-insured member must pay an annual assessment into the system determined on the credit rating of the self-insurer and undiscounted claims liability. The credit rating utilized may be one that is publicly available or in the case of a non-rated self-insurer, one that is developed from a proprietary model utilized by the SISA. The credit rating is converted into an equivalent assessment rate and multiplied by the self-insurer’s undiscounted claims liability to derive the assessment amount.
Any self-insurer excluded from participation in the AASS, shall deposit with the Commissioner an amount not less than 100% of the individual self-insurer’s total undiscounted claims liability per the most recent report from a qualified actuary, but not less than $500,000. An exemption from the 100% requirement may be considered upon submission of evidence of a credit rating qualifying under statute, but in no instance below 25% of the individual self-insurer’s total undiscounted claims liability per the most recent report from a qualified actuary or $500,000, whichever is greater. In addition, for any given year that the AASS is not in effect, the deposit process will revert to the procedure previously stated.
- Interest-bearing bonds
- Issued by the United States of America
- Issued by the State of North Carolina, or of its cities or counties
- Certificates of deposit issued by a bank domiciled in North Carolina (Maturity must be one year or greater).
- Surety bonds in a form acceptable to the Commissioner and issued by a corporate surety.
- Irrevocable letters of credit in a form acceptable to the Commissioner issued by a bank acceptable to the Commissioner (must be executed on the Department’s form).