58-20-1
Definition of terms.
58-20-2
Policies subject to chapter.
58-20-3
Issuance of policies covering employers as well as employees--Wage values of
employers--Rights and remedies of employers.
58-20-3.1
Premiums based on certain wages prohibited.
58-20-4
Separate coverage of workers' compensation liabilities.
58-20-5
Entire liability of employer to employees covered by policy--Separate policy for
specified plant or work location, special authorization.
58-20-6
Agreement of insurer as to prompt payment--Obligation not affected by any default
of insured after injury--Direct obligation of insurer.
58-20-7
Right of employees to enforce liability of insurance carrier--Inclusion of provision
in policy.
58-20-8
Payment of compensation by employer or insurance carrier bars recovery against the
other.
58-20-9
Lien of worker upon amount due under policy--Inability of insured, direct payment
by insurer to worker, agents, and dependents.
58-20-10
Notice to either employer or insurer--Required policy provision.
58-20-11
Provision relieving insurer from payment on insolvency of insured prohibited.
58-20-12
Policy insuring against employers' liability other than workers' compensation--Required provisions--Liability of insurer--Actions for recovery.
58-20-13
Form of insurance to be approved before issuance--Ruling subject to appeal.
58-20-14
Cancellation of policy--Notice of intention to cancel--Service on employer.
58-20-15
Equitable apportionment among insurers of applicants for policies--Participation by
all insurers--Appeal to director--Judicial review.
58-20-16
Reinsurance reserve--Amount required.
58-20-17
Unallocated compensation loss expense payments--Distribution schedule included
in annual statement.
58-20-18
Unallocated liability loss expense payments--Distribution schedule included in
annual statement.
58-20-19
Inadequacy of liability or compensation loss reserves--Maintenance of additional
reserves required by director.
58-20-20
Annual statement--Inclusion of experience schedule.
58-20-21
Annual workplace safety review services--Recommendations for improved safety--Increased premiums.
58-20-22
Premium reductions and premium increases for certain insurers.
58-20-23
Liability for indemnity compensation or medical loss defined.
58-20-24
Policy to provide medical services and health care.
58-20-25
Terms as used in §§ 58-20-25 to 58-20-40.
58-20-26
Electric utilities authorized to form self-insurance associations.
58-20-27
Application for self-insurance association--Form.
58-20-28
Requirements to obtain self-insurance certificate.
58-20-29
Granting self-insurance application--Revocation.
58-20-30
Examination of self-insurance association's activities and records.
58-20-31
Promulgation of rules governing self-insurance associations.
58-20-32
Voluntary termination of participation in self-insurance association.
58-20-33
Involuntary termination of membership in self-insurance association.
58-20-34
Liability for contractual obligations subsequent to termination in self-insurance
association.
58-20-35
Annual report of affairs of self-insurance associations.
58-20-36
Dissolution of self-insurance association to be approved by department.
58-20-37
Deficiency of self-insurance associations made up by members.
58-20-38
Revocation of self-insurance association's certificate.
58-20-39
Self-insurance association not an insurance company.
58-20-40
Proceedings or investigations by department.
58-20-1. Definition of terms.
Terms used in this chapter, unless the context otherwise plainly requires, shall mean:
(1) "Compensation" shall relate to all insurances effected by virtue of statutes providing compensation to employees for personal injuries irrespective of fault of the employer;
(2) "Earned premiums" shall include gross premiums charged on all policies written, including all determined excess and additional premiums, less return premiums, other than premiums returned to policyholders as dividends, and less reinsurance premiums and premiums on policies canceled, and less unearned premiums on policies in force. Any participating insurer which has charged in its premiums a loading solely for dividends, shall not be required to include such loading in its earned premiums, provided a statement of the amount of such loading has been filed with and approved by the director;
(3) "Liability" shall relate to all insurance except compensation insurance against loss or damage from accident to or injury suffered by an employee or other person and for which the insured is liable;
(4) "Loss payments" and "loss expense payments" shall include payments to claimants, including payments for medical or surgical attendants, legal expenses, salaries and expenses of investigators, adjusters and field men, rents, stationery, telegraph and telephone charges, postage, salaries and expenses of office employees, home office expenses, and all other payments made on account of claims, whether such payments shall be allocated to specific claims or unallocated.
Source: SL 1966, ch 111, ch 29, § 1.
58-20-2. Policies subject to chapter.
All policies or contracts made for the insurance of the compensation provided by the title, Workers' Compensation, or against employers' liability described in § 58-20-12, shall be deemed to be made subject to the provisions of this chapter and all provisions of such policies inconsistent herewith shall be void.
Source: SL 1966, ch 111, ch 29, § 13.
58-20-3. Issuance of policies covering employers as well as employees--Wage values of employers--Rights and remedies of employers.
Any insurer authorized or which may be authorized to write workers' compensation insurance in this state, shall be and is hereby authorized to issue policies covering employers who perform labor incidental to their occupations as well as employees, such policies insuring to such employers the same compensation as provided for their employees and at the same rates. The estimation of wage values of employers as herein mentioned, shall be reasonable and separately stated in and added to the valuation of their payrolls on which their premiums are computed. Employers so insured shall have the same rights and remedies as are given to an employee under Title 62.
Source: SL 1966, ch 111, ch 29, § 14.
58-20-3.1. Premiums based on certain wages prohibited.
Premiums for workers' compensation insurance may not be based on wages paid to employees while they are on vacation, holidays, or sick leave or on wages received from employment not performed for the insured employer.
Source: SL 1983, ch 386; SL 2016, ch 236, § 7.
58-20-4. Separate coverage of workers' compensation liabilities.
Every policy of workers' compensation insurance, issued or delivered in this state by an authorized domestic or foreign insurer, shall cover separately and for a separate consideration, all the liabilities which are imposed upon an insurer by the provisions of the title, Workers' Compensation, and amendments thereof, whatever other contingencies may be insured by riders attached thereto or endorsements made thereon.
Source: SL 1966, ch 111, ch 29, § 5.
58-20-5. Entire liability of employer to employees covered by policy--Separate policy for specified plant or work location, special authorization.
Every policy of insurance issued by a stock insurer, or by a mutual association authorized to transact workers' compensation or employers' liability insurance in this state, shall cover the entire liability of the employer to his employees covered by the policy or contract. However, if specifically authorized by the director, a separate policy may be issued for a specified plant or work location if the liability of such employer under this chapter to all his other employees, is otherwise secured.
Source: SL 1966, ch 111, ch 29, § 7.
58-20-6. Agreement of insurer as to prompt payment--Obligation not affected by any default of insured after injury--Direct obligation of insurer.
No such policy of insurance shall be issued unless it contains the agreement of the insurer that it will promptly pay to the person entitled to compensation all installments of the compensation that may be awarded or agreed upon, and that the obligation shall not be affected by any default of the insured after the injury, or by any default in the giving of any notice required by such policy, or otherwise. Such agreement shall be construed to be a direct obligation by the insurer to the person entitled to compensation, enforceable in his name.
Source: SL 1966, ch 111, ch 29, § 10.
58-20-7. Right of employees to enforce liability of insurance carrier--Inclusion of provision in policy.
Every policy of insurance issued by a stock insurer or by a mutual insurer shall contain a provision setting forth the right of the employees to enforce in their own names, either by at any time filing a separate claim or by at any time making the insurance carrier a party to the original claims, the liability of the insurance carrier in whole or in part for the payment of such compensation.
Source: SL 1966, ch 111, ch 29, § 7.
58-20-8. Payment of compensation by employer or insurance carrier bars recovery against the other.
Payment of such compensation, in whole or in part, by either the employer or the insurance carrier shall, to the extent thereof, be a bar to the recovery against the other of the amount so paid.
Source: SL 1966, ch 111, ch 29, § 7.
58-20-9. Lien of worker upon amount due under policy--Inability of insured, direct payment by insurer to worker, agents, and dependents.
Every policy shall provide that the worker shall have a first lien upon any amount becoming due on account of such policy to the insured from the insurer, and that in case of the legal incapacity, inability, or disability of the insured to receive the amount due and pay it over to the insured worker, or his dependents, such insurer shall pay the same directly to such worker, his agent, or to a trustee for him or his dependents, to the extent of discharging any obligation of the insured and to such worker or his dependents.
Source: SL 1966, ch 111, ch 29, § 9.
58-20-10. Notice to either employer or insurer--Required policy provision.
Every policy issued by any corporation, association or organization to assure the payment of compensation under the provisions of the title "Workers' Compensation" shall contain a clause providing that, as between any employer and the insurer, notice or knowledge of the occurrence of injury or death on the part of the insured shall be notice or knowledge on the part of the insurer; and jurisdiction of the insured for the purpose of this chapter shall be jurisdiction of the insurer, and the insurer shall be bound by every agreement, adjudgment, award, or judgment rendered against the insured.
Source: SL 1966, ch 111, ch 29, § 8.
58-20-11. Provision relieving insurer from payment on insolvency of insured prohibited.
No such policy of insurance issued shall contain any provision relieving the insurer from payment if the insured becomes insolvent or discharged in bankruptcy during the period that the policy is in operation, or the compensation, or any part of it, is due and unpaid.
Source: SL 1966, ch 111, ch 29, § 9.
58-20-12. Policy insuring against employers' liability other than workers' compensation--Required provisions--Liability of insurer--Actions for recovery.
Every policy written insuring against the liability of employers for personal injuries, other than payment of compensation under the provisions of the title, Workers' Compensation, shall contain provisions to the effect that the insurer shall be directly liable to the injured party, and, in the event of his death, to the party entitled to sue therefor, to pay him the amount of damages for which such insured is liable. Such injured party, or, in the event of his death, the party entitled to sue therefor, in his suit against the insured, may join the insurer as a defendant, in which case judgment shall bind either or both the insured and the insurer, or such injured party, or in the event of his death, the party entitled to sue therefor, after having obtained judgment against the insured alone, may proceed on such judgment in a separate claim against such insurer; but payment of such liability, in whole or in part, by either the insured or the insurer shall, to the extent thereof, be a bar to recovery against the other of the amount so paid. In no case shall the insurer be liable for damages beyond the face amount of the policy.
Source: SL 1966, ch 111, ch 29, § 12.
58-20-13. Form of insurance to be approved before issuance--Ruling subject to appeal.
No such policy of compensation or liability insurance or rider shall be issued or delivered in this state until a copy of the form thereof shall have been filed with the director at least thirty days, unless prior to the expiration of such thirty days, the director shall in writing approve such form; also, no such policy or rider shall be issued if the director, in writing, notifies the insurer that in his opinion the form of such policy or rider does not comply with the provisions of this chapter, specifying the reasons. Such ruling shall be subject to appeal, the same as other decisions of the director in quasi-judicial matters.
Source: SL 1966, ch 111, ch 29, § 6.
58-20-14. Cancellation of policy--Notice of intention to cancel--Service on employer.
No workers' compensation policy may be cancelled for nonpayment of premiums unless notice of the cancellation has been sent by mail to the employer at least ten days prior to the date of cancellation. Any policy cancelled for reasons other than nonpayment of premiums is subject to the provisions of §§ 58-33-59 to 58-33-65.1, inclusive. For any cancellation, the insurer shall provide notice to the Department of Labor and Regulation at the same time notice is provided to the employer. The notice shall be served on the employer by delivering it to the employer or by sending it by mail, by registered or certified letter addressed to the employer at the employer's last known place of residence, but if the employer is a partnership, then such notice may be so given to any one of the partners, and if the employer be a corporation, then the notice may be given to any agent or officer of the corporation upon whom legal process may be served.
Source: SL 1966, ch 111, ch 29, § 11; SL 1971, ch 275, § 6; SL 1982, ch 28, § 18; SL 2004, ch 306, § 1; SL 2011, ch 1 (Ex. Ord. 11-1), § 33, eff. Apr. 12, 2011.
58-20-15. Equitable apportionment among insurers of applicants for policies--Participation by all insurers--Appeal to director--Judicial review.
After consultation with insurers authorized to issue workers' compensation policies in this state, the director shall provide or approve a reasonable plan or plans for the equitable apportionment among such insurers of applicants for such workers' compensation policies who are in good faith entitled to but unable to procure such policies through ordinary methods. The director may approve applicants who are only able to procure workers' compensation policies at a rate that substantially exceeds that of the rate in the plan. When any such plans have been made by or been approved by the director, all such insurers shall subscribe thereto and participate therein. Any applicant for any such policy, any person insured under any such plan, and any insurer affected thereby, may appeal to the director from any ruling or decision of the manager or committee designated to operate such plan. Any person aggrieved hereunder by any order or act of the director may, within ten days after notice thereof, file a petition in the circuit court for the county of Hughes, or in the circuit court for the county in which applicant is a resident, for a review thereof. The court shall summarily hear the petition and make any appropriate order or decree.
Source: SL 1966, ch 111, ch 29, § 15; SL 2004, ch 306, § 2.
58-20-16. Reinsurance reserve--Amount required.
Any insurer engaging in the business of writing workers' compensation insurance in this state shall maintain a reinsurance reserve for outstanding losses under such insurance, for which the insured is liable as follows:
(1) For all liability suits being defended under policies written more than ten years prior to the date as of which the statement is made, one thousand five hundred dollars for each suit; five and less than ten years prior to the date as of which the statement is made, one thousand dollars for each suit; three and less than five years prior to the date as of which the statement is made, eight hundred fifty dollars for each suit.
(2) For all liability policies written during the three years immediately preceding the date as of which the statement is made, such reserve shall be sixty percent of the earned liability premiums of each of such years, less all loss and loss expense payments made under liability policies written in the corresponding years; but in any event, such reserve shall, for the first of such three years, be not less than seven hundred fifty dollars for each outstanding liability suit on said year's policies.
(3) For all compensation claims under policies written more than three years prior to the date as of which the statement is made, the present values at four percent interest of the determined and the estimated future payments.
(4) For all compensation claims under policies written in the three years immediately preceding the date as of which the statement is made, such reserve shall be sixty-five percent of the earned compensation premiums of each of such three years, less all loss and loss expense payments made in connection with such claims under policies written in the corresponding years; but in any event, in the case of the first year of any such three-year period, such reserve shall be not less than the present value at four percent interest of the determined and the estimated unpaid compensation claims under policies written during such year.
Source: SL 1966, ch 111, ch 29, § 2.
58-20-17. Unallocated compensation loss expense payments--Distribution schedule included in annual statement.
All unallocated compensation loss expense payments made in a given calendar year subsequent to the first three years in which an insurer has been issuing compensation policies shall be distributed as follows: forty percent shall be charged to the policies written in that year, forty-five percent to the policies written in the preceding year, ten percent to the policies written in the second year preceding and five percent to the policies written in the third year preceding, and such payments made in each of the first three calendar years in which an insurer issues compensation policies shall be distributed as follows: in the first calendar year one hundred percent shall be charged to the policies written in that year; in the second calendar year fifty percent shall be charged to the policies written in that year and fifty percent to the policies written in the preceding year; in the third calendar year forty-five percent shall be charged to the policies written in that year, forty-five percent to the policies written in the preceding year and ten percent to the policies written in the second year preceding; and a schedule showing such distribution shall be included in the annual statement.
Source: SL 1966, ch 111, ch 29, § 3.
58-20-18. Unallocated liability loss expense payments--Distribution schedule included in annual statement.
All unallocated liability loss expense payments made in a given calendar year, subsequent to the first four years in which an insurer has been issuing liability policies, shall be distributed as follows: thirty-five percent shall be charged to the policies written in that year, forty percent to the policies written in the preceding year, ten percent to the policies written in the second year preceding, ten percent to the policies written in the third year preceding, and five percent to the policies written in the fourth year preceding, and such payments made in each of the first four calendar years in which an insurer issues liability policies shall be distributed as follows: In the first calendar year one hundred percent shall be charged to the policies written in that year; in the second calendar year fifty percent shall be charged to the policies written in that year and fifty percent to the policies written in the preceding year; in the third calendar year forty percent shall be charged to the policies written in that year, forty percent to the policies written in the preceding year, and twenty percent to the policies written in the second year preceding; in the fourth calendar year thirty-five percent shall be charged to the policies written in that year, forty percent to the policies written in the preceding year, fifteen percent to the policies written in the second year preceding, and ten percent to the policies written in the third year preceding; and a schedule showing such distribution shall be included in the annual statement.
Source: SL 1966, ch 111, ch 29, § 3.
58-20-19. Inadequacy of liability or compensation loss reserves--Maintenance of additional reserves required by director.
Whenever, in the judgment of the director, the liability or compensation loss reserves of any insurer under his supervision, calculated in accordance with the provisions of §§ 58-20-16 to 58-20-18, inclusive, are inadequate, he may require such insurer to maintain additional reserves based upon estimated individual claims or otherwise.
Source: SL 1966, ch 111, ch 29, § 3.
58-20-20. Annual statement--Inclusion of experience schedule.
Each insurer that writes liability or compensation policies shall include in the annual statement required by law a schedule of its experience thereunder in such form as the director may prescribe.
Source: SL 1966, ch 111, ch 29, § 4.
58-20-21. Annual workplace safety review services--Recommendations for improved safety--Increased premiums.
Any insurer writing workers' compensation insurance in this state shall offer to conduct or contract for annual workplace safety review services, including review reports with written recommendations for improved safety procedures, to each of its insureds whose policy premium is five thousand dollars or more, unless the employer has five or fewer employees. No written recommendation prepared by an insurer pursuant to this section is subject to discovery or disclosure under chapter 15-6 or any other provision of law or admissible as evidence in any action of any kind in any court or arbitration forum. However, the recommendation may be disclosed to a subsequent insurer of the employer. Compliance with this section does not constitute an undertaking by an insurer to supplant any responsibility its insured may otherwise have for workplace safety. Any employer subject to this section shall have workplace safety reviews conducted by the employer's insurer at least once every three years. If an insurer makes a written recommendation to correct a safety deficiency pursuant to § 58-20-21, including failure to post safety posters as required by § 62-2-11, and the deficiency has not been corrected at the time of a subsequent safety review, the insured is subject to an appropriate increase in premium as determined by the insurer subject to the approval of the director. The insurer is not responsible for inspecting for compliance with federal or state safety laws or regulations.
Source: SL 1992, ch 364, § 8; SL 1993, ch 362, § 1; SL 1997, ch 292, § 1; SL 2004, ch 306, § 3.
58-20-22. Premium reductions and premium increases for certain insurers.
Any insurer writing workers' compensation in this state shall provide an appropriate reduction in premium, as determined by the insurer, to its insureds that due to size do not qualify for experience rating and who have not incurred liability for indemnity compensation or for medical losses exceeding an amount to be determined by the insurer subject to approval by the director for the past three years. Further, any insured that due to size does not qualify for experience rating and who has incurred liability for indemnity compensation or for medical losses exceeding an amount to be determined by the insurer subject to approval by the director during the past three years is subject to an appropriate increase in premium as determined by the insurer.
Source: SL 1992, ch 364, § 9; SL 1993, ch 362, § 2.
58-20-23. Liability for indemnity compensation or medical loss defined.
For purposes of § 58-20-22, liability for indemnity compensation or medical losses means payment made to or on behalf of the injured worker for medical costs, loss of wages, or injuries resulting in permanent total, permanent partial, or temporary disabilities, as defined in §§ 62-1-1, 62-4-1, and 62-4-6.
Source: SL 1992, ch 364, § 10; SL 1993, ch 362, § 3.
58-20-24. Policy to provide medical services and health care.
Effective January 1, 1995, every policy issued by any corporation, association, or organization to assure the payment of compensation under the provisions of the title, Workers' Compensation, shall contain provisions to provide medical services and health care to injured workers for compensable injuries and diseases under a case management plan that meets the requirements established in rules promulgated by the Department of Labor and Regulation pursuant to chapter 1-26. All policies and plans shall meet the requirements of § 58-17-54. However, the requirements of this section become effective January 1, 1994, for insurers issuing policies pursuant to § 58-20-15.
Source: SL 1993, ch 381, § 5; SL 1999, ch 261, § 1; SL 2011, ch 1 (Ex. Ord. 11-1), § 33, eff. Apr. 12, 2011.
58-20-25. Terms as used in §§ 58-20-25 to 58-20-40.
Terms used in §§ 58-20-25 to 58-20-40, inclusive, mean:
(1) "Administrator," a person, partnership, limited liability company, or corporation engaged by a workers' compensation self-insurance association to carry out the policies established by the association and to provide management for the association;
(2) "Association," a not-for-profit workers' compensation self-insurance association consisting of two or more employers which are electric utilities, or an electric utility trade association, which enter into agreements to pool their liabilities for workers' compensation benefits in this state;
(3) "Certificate," a workers' compensation self-insurance certificate issued by the department in accordance with §§ 58-20-25 to 58-20-40, inclusive;
(4) "Department," the South Dakota Department of Labor and Regulation;
(5) "Insolvency," the inability of an association to pay its outstanding lawful obligations as they mature in the regular course of business, as may be shown either by an excess of its required reserves and other liabilities over its assets, or by its not having sufficient assets to reinsure all of its outstanding liabilities after paying all accrued claims owed by it; and
(6) "Workers' compensation liability," liability to which an electric utility company is subject as an employer under the South Dakota workers' compensation law.
Source: SL 1995, ch 282, § 1; SL 2011, ch 1 (Ex. Ord. 11-1), § 33, eff. Apr. 12, 2011.
58-20-26. Electric utilities authorized to form self-insurance associations.
Any two or more electric utility employers or their trade associations may form an association for the purpose of providing to members group self-insurance to protect members against losses arising from workers' compensation liability.
Source: SL 1995, ch 282, § 2.
58-20-27. Application for self-insurance association--Form.
An association proposing to self-insure its workers' compensation liability shall apply to the department for the authority to self-insure, using forms available from the department. The application shall include:
(1) The association's name;
(2) The location and mailing address of the association's principal office and where its books and records are kept;
(3) The name and address of each member of the association;
(4) A copy of the bylaws or plan of operation adopted by the association;
(5) Proof of compliance with § 58-20-28;
(6) A sample copy of the agreement between the association and the members securing the payment of each member's workers' compensation liability;
(7) A pro forma financial statement, on a form acceptable to the department, showing the financial ability of the association to pay the workers' compensation liability of its members; and
(8) The required application fee.
Source: SL 1995, ch 282, § 3.
58-20-28. Requirements to obtain self-insurance certificate.
To obtain and maintain its certificate an association shall:
(1) Have sufficient assets, net worth, and liquidity to promptly meet all obligations of the association's members under §§ 58-20-25 to 58-20-40, inclusive, and their workers' compensation liability. In determining whether an association is in sound financial condition, consideration shall be given to the combined net worth of the member companies; the combined long-term and short-term debt to equity ratios of the member companies; other financial data requested by the department or submitted by the group; and the combined workers' compensation experience of the group for the last three years;
(2) Furnish to the department security in the form of a bond, cash, certificate of deposit, government securities, irrevocable letter of credit, irrevocable trust, in any combination, in an amount equal to the greater of:
(a) Two hundred fifty thousand dollars; or
(b) Twenty-five percent of the association's preceding year's gross annual assessments to its members;
(3) Obtain specific and aggregate excess insurance by an insurance company licensed to conduct business in South Dakota; and
(4) Maintain an indemnity agreement jointly and severally binding the association and each member of the association to meet the workers' compensation liability of each member.
Source: SL 1995, ch 282, § 4.
58-20-29. Granting self-insurance application--Revocation.
The department shall grant or deny the association's application to self-insure within sixty days after a complete application has been filed. However, the time may be extended for an additional thirty days upon fifteen days' prior notice to the applicant. The department shall grant a certificate upon a determination that the association has complied with the requirements of §§ 58-20-25 to 58-20-40, inclusive, or the department shall issue an order denying a certificate setting forth the reasons for such refusal. Approval of the certificate shall remain effective until voluntarily terminated by the request of the association pursuant to § 58-20-33 or revoked by order of the department. A certificate may be revoked by the department if the association has failed to comply with §§ 58-20-25 to 58-20-40, inclusive, rules promulgated hereunder, or for a violation of § 58-20-38. If issued by the department, a certificate authorizes the association to provide workers' compensation benefits and establishes compliance by the association's members with § 62-5-1.
Source: SL 1995, ch 282, § 5.
58-20-30. Examination of self-insurance association's activities and records.
The department may examine the affairs, transactions, accounts, records, assets, and liabilities of any association created under §§ 58-20-25 to 58-20-40, inclusive, as deemed reasonably necessary.
Source: SL 1995, ch 282, § 6.
58-20-31. Promulgation of rules governing self-insurance associations.
The department may promulgate rules governing associations pursuant to chapter 1-26 concerning:
(1) Application, financial, annual reports, or other forms to be created by the department under §§ 58-20-25 to 58-20-40, inclusive;
(2) Financial requirements of the department for approving and maintaining a certificate;
(3) Requiring an application fee not to exceed two thousand dollars; and
(4) Requiring the association to process and act upon claims in accordance with the guidelines applicable for domestic insurance companies.
Source: SL 1995, ch 282, § 7.
58-20-32. Voluntary termination of participation in self-insurance association.
A member may voluntarily terminate its participation in an association by giving written notice to the other members of the association and the department at least ninety days before the desired termination date. The voluntary termination shall be approved by the department if it finds that the terminating member and the remaining members of the association are in good standing and have met all requirements of §§ 58-20-25 to 58-20-40, inclusive.
Source: SL 1995, ch 282, § 8.
58-20-33. Involuntary termination of membership in self-insurance association.
A member may be involuntarily terminated as a member of the association if the department finds, after due notice and hearing, that the member:
(1) Has failed to pay any contribution or assessment due to the association;
(2) Has failed to comply with §§ 58-20-25 to 58-20-40, inclusive, or the rules promulgated pursuant to §§ 58-20-25 to 58-20-40, inclusive; or
(3) Has failed to comply with the bylaws, loss control policies or discharge any other obligation it owes to the association.
A hearing may be initiated by the department on its own initiative or upon the request of the association's board of directors.
Source: SL 1995, ch 282, § 9.
58-20-34. Liability for contractual obligations subsequent to termination in self-insurance association.
Any member who voluntarily terminates its membership in the association, or who is involuntarily terminated as a member of the association, shall nevertheless remain liable subsequent to the date of termination for all contractual obligations it entered into with the association during its membership in the association.
Source: SL 1995, ch 282, § 10.
58-20-35. Annual report of affairs of self-insurance associations.
Each year after an association has been granted a certificate, the association shall file with the department an annual report of its affairs and operations during the last preceding calendar year. The report shall be made in such form and shall contain such information as the department may require in order to protect the public interest and the interests of the members of the association. An association shall provide a copy of its last fiscal year CPA audit of its operations to the department if requested.
Source: SL 1995, ch 282, § 11.
58-20-36. Dissolution of self-insurance association to be approved by department.
No association may be voluntarily dissolved or otherwise cease to function without written approval by the department after the department has determined that all claims and other legal obligations of the association have been paid or that adequate provisions for such payment have been made.
Source: SL 1995, ch 282, § 12.
58-20-37. Deficiency of self-insurance associations made up by members.
If the assets of an association are at any time insufficient to enable the association to discharge its liabilities and obligations, the association's members shall make up the deficiency or the department may order the association to levy an assessment upon its members in an amount necessary to make up the deficiency.
Source: SL 1995, ch 282, § 13.
58-20-38. Revocation of self-insurance association's certificate.
If an association fails to make up a deficiency or to make the required assessment of its members pursuant to § 58-20-37 within thirty days after the department orders it to do so, or if the deficiency is not fully made up within sixty days after the date on which the assessment is made, or within a longer period of time as may be specified by the department, the department shall revoke the association's certificate.
Source: SL 1995, ch 282, § 14.
58-20-39. Self-insurance association not an insurance company.
Notwithstanding any other provision of law to the contrary, any association organized pursuant to §§ 58-20-25 to 58-20-40, inclusive, is not an insurance company or insurer under the laws of this state; any agreement forming an association does not constitute insurance or the conduct of an insurance business; and no association organized pursuant to §§ 58-20-25 to 58-20-40, inclusive, may be a member of the South Dakota Insurance Guaranty Association.
Source: SL 1995, ch 282, § 15.
