<html> <head> <title>Rule 20:06:57:03 Application for authorization.</title> <META NAME="Keywords" Content="Administrative Rules 20:06:57:03"> <META NAME="Description" Content="Administrative Rules 20:06:57:03 Application for authorization."> <meta http-equiv=Content-Type content="text/html; charset=windows-1252"> <meta name=Generator content="Microsoft Word 15 (filtered)"> <style> <!-- /* Font Definitions */ @font-face {font-family:"Cambria Math"; panose-1:2 4 5 3 5 4 6 3 2 4;} /* Style Definitions */ p.MsoNormal, li.MsoNormal, div.MsoNormal {margin:0in; margin-bottom:.0001pt; text-align:justify; font-size:12.0pt; font-family:"Times New Roman",serif;} a:link, span.MsoHyperlink {color:blue; text-decoration:underline;} a:visited, span.MsoHyperlinkFollowed {color:purple; text-decoration:underline;} .MsoChpDefault {font-size:10.0pt;} @page WordSection1 {size:8.5in 11.0in; margin:1.0in 1.0in 1.0in 1.0in;} div.WordSection1 {page:WordSection1;} --> </style> </head> <body lang=EN-US link=blue vlink=purple> <div class=WordSection1> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>20:06:57:03.&nbsp;&nbsp;Application for authorization.</b> A person applying for authorization pursuant to SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-88">58-18-88</A> shall submit a plan of operation with the director. The application and plan of operation shall include the following:</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (1)&nbsp;&nbsp;A business plan including a copy of all contracts or other instruments which the multiple employer trust proposes to make with or sell to its members, a copy of the plan description, and the printed materials to be used in the solicitation of members;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (2)&nbsp;&nbsp;Copies of all articles, bylaws, agreements, trust documents, or other documents or instruments describing the rights and obligations of employers, employees, and beneficiaries;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (3)&nbsp;&nbsp;A current list of all members of the employer group or association sponsoring the multiple employer trust and a description of the relationship among the employers which serves as the basis for the formation of the association or employer group;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (4)&nbsp;&nbsp;A description of the activities of the association or group of employers on behalf of its members other than the sponsorship of the multiple employer trust;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (5)&nbsp;&nbsp;Current financial statements of the multiple employer trust which shall include, at a minimum, balance sheets, income statement, cash flow statement, and a detailed listing of assets;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (6)&nbsp;&nbsp;An actuarial opinion prepared, signed, and dated by a member of the American Academy of Actuaries which states that appropriate loss and loss adjustment reserves have been established, that adequate premiums are being charged, and that the association multiple employer trust is operating in accordance with sound actuarial principles;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (7)&nbsp;&nbsp;A statement from an authorized representative of the applicant which certifies all of the following:</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)&nbsp;&nbsp;The multiple employer trust is administered by an authorized insurer or an authorized third-party administrator;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)&nbsp;&nbsp;The multiple employer trust is eligible for authorization pursuant to SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-88">58-18-88</A>;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)&nbsp;&nbsp;The association or group of employers sponsoring the multiple employer trust is engaged in substantial activity for its members other than sponsorship of an employer benefit plan; and</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)&nbsp;&nbsp;The association is a nonprofit entity organized and authorized to do business under applicable South Dakota law;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (8)&nbsp;&nbsp;A statement from an authorized representative of the applicant which certifies that the applicable provisions of SDCL chapter <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18">58-18</A>, ARSD chapter 20:06:42, and this chapter have been met;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (9)&nbsp;&nbsp;A statement from the applicant that, to the best of its knowledge and belief, the multiple employer trust is in compliance with all applicable provisions of the Employee Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.);</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (10)&nbsp;&nbsp;A description of the mechanism approved by the director to ensure that claims will be paid in the event that a member of the multiple employer trust is unable to comply with the multiple employer trust's contribution requirements;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (11)&nbsp;&nbsp;A copy of the most recent Form M-1 filed by the multiple employer trust with the U.S. Department of Labor, Pension and Welfare Benefits Administration, if applicable; and</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (12)&nbsp;&nbsp;Any additional information requested by the director.</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Source:</b> 40 SDR 102, effective December 3, 2013; 45 SDR 158, effective June 27, 2019.</p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>General Authority:</b> SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-79">58-18-79</A>, <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-89">58-18-89.</A></p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Law Implemented:</b> SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-88">58-18-88</A>, <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=58-18-89">58-18-89.</A></p> <p class=MsoNormal style='margin-left:-.7pt'>&nbsp;</p> </div> </body> </html>