CCLME.ORG - DIVISION 1. DEPARTMENT OF INDUSTRIAL RELATIONS CHAPTERS 1 through 6

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0-2999 $4000

3000-6999 $6000
7000 and over $8000
[FNa1] An additional $300 per adjusting location for every location over 1.

Note : The above table shall apply against the last full year Self-Insurer's Annual Report submitted. If two or more annual reports are prepared from separate records at the same address, they shall be counted as separate adjusting locations.
(b) If the above table fails to produce sufficient funds to meet the total anticipated costs for the administration of the self-insurance program by the Director, an additional charge per employee covered by each self- insurance plan shall be made to cover these costs.
(c) The Manager shall invoice each private self-insurer on or before October 1 of each year, an assessment for the total cost of administration of the private Self-Insurance Plans program for the current fiscal year. The assessment is due 30 days after invoice mailing.
(d) Each new private sector self-insurer granted a certificate shall pay a pro-rata share of the annual license fee as determined by the Manager based on the information provided on the application. The fee shall be adjusted and pro-rated for the portion of the fiscal year remaining. The payment of the fee shall be made within thirty (30) days from the date of billing.
(e) Each private self insured certificate holder whose certificate is revoked after June 30, 2001, shall pay the full license fee assessment for the next five full calendar years after the date of revocation order or until their security deposit reaches the statutory minimum.

Note: Authority cited: Sections 54, 55, 3702.5 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3702.5 and 3702.10, Labor Code.

s 15231. Public Sector License Fee.
A public sector self-insurer shall not be subject to the payment of the annual license fee assessment.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3702.5 and 3702.10, Labor Code.

s 15232. User Funding Assessment.
The Manager shall collect the user funding assessment from all self-insurers and the State of California as set forth in Sections 15600-15610 of these regulations.

Note: Authority cited: Sections 54, 55, 62.5 and 3702.10, Labor Code. Reference: Sections 59, 62.5, 3700, 3702.9 and 3702.10, Labor Code.

s 15233. Fraud Investigation and Prosecution Assessment.
The Manager shall collect the state fraud investigation and prosecution surcharge from all self insurers and the State of California as set forth in Sections 15600-15610 of these regulations.

Note: Authority cited: Sections 54, 55, 62.5, 62.6 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3702.5 and 3702.10, Labor Code.

s 15234. Cal/OSHA Targeted Inspection and Consultation Assessment.
The Manager shall collect the Cal/OSHA Targeted Inspection and Consultation Assessment from all affected self insurers as set forth in Sections 15600 and 15601.7 of these regulations.

Note: Authority cited: Sections 54, 55, 62.7, 62.9 and 3702.10, Labor Code. Reference: Sections 59, 62.7, 62.9, 3700, 3702.5 and 3702.10, Labor Code.

s 15250. Required Deposit.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 55 and 3702.10, Labor Code.

s 15250.1. Maintenance of Deposit.

Note: Authority cited; Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55 and 3702.10, Labor Code.

s 15251. Self Insurer's Annual Report.
(a) Every self-insurer shall file a Self-Insurer's Annual Report on forms supplied by the Manager as follows:
(1) Form A4-40a (Rev. 6/2001) for individual private self insurers;
(2) Form A4-40b (Rev. 4/92) for public self insurers without a Joint Power Authority;

(3) Form A4-40c (Rev. 4/92) for public sector self insurers that belong to a Joint Powers Authority;
(4) Form A4-40d (Rev. 1/94) for private group self insurers. The filing of the annual report by each self insurer and each former self insurer shall continue until all the self-insured workers' compensation claims are resolved and all benefit payments have been made.
Note 1: Sample generic Annual Report forms are contained in Plates J-1, and J-2 and J-3 of the Appendix following the last Article of these Group 2 regulations. When the forms are distributed by the Manager, the forms shall contain appropriate reporting year and prior year designations and shall be color-coded for ease of identification.
(b) For private self insurers, individual or with a group, the report shall be filed on or before March 1 of each year and shall include the following information:
(1) General Information.
(A) Certificate to Self Insure number, status of certificate, and period of report.
(B) Name and address of master certificate holder, state of incorporation, federal tax identification number, and first four digits of North American Industry Classification System (NAICS).
(C) List of all subsidiaries or affiliate companies that are covered by the master certificate to self insure, their state of incorporation, and their subsidiary/affiliate certificate number.
(D) Notification of any reincorporation, merger, change in name or identity or any additions to the self insurance program by the master certificate holder or any subsidiary/affiliate company during the reporting period.
(E) Name and address of person to whom all correspondence related to self insurance should be addressed.
(F) Employment and wages paid in that calendar year as reported to Employment Development Department on the employer's Form DE-6 Quarterly Report.
Exception: A Certificate to Self Insure that is revoked for three full years is not required to submit this employment and wage information.
(2) Claims Liability and Administrator Information.
(A) A Liabilities by Reporting Location report shall be submitted by each claims administrator administering claims for the said self insurer and shall include:
(1.) All claims reported on or before December 31 of each of the five prior calendar years (January 1 through December 31), showing indemnity and medical payments grouped as incurred liability, paid to date and future liability.
(2.) All open claims reported prior to the 5 years shall also be reported as in subsection (b)(2)(A)(1.) above in a single line entry;
(3.) For the reporting year of the annual report the total of indemnity and medical future liability, the total estimated future liability of claims, the total benefits paid, number of medical only cases reported, number of indemnity cases reported; number of fatality cases, number of claims for which the employer or administrator was notified of representation by an attorney or legal representative in the reporting year, and number of new applications for adjudication received for any claims that year.
(4.) Total number of open indemnity cases in all years.
(5.) Name, address and Certificate to Administer number of the self insurer's claims administrator.
(6.) Notification of any change in administrator during the period covered by the report and, if applicable, the name and address of the prior administrator.
(7.) A certification by the qualified claims administrator that the report is true, correct and complete with respect to the workers' compensation liabilities incurred and paid, signed and dated with the name and address of the said administrator completing the Liabilities by Reporting Location page.
(B) An additional separate Liabilities by Reporting Location report shall be submitted if any of the following occur:
(1.) Separate security deposits are posted by a single self insured certificate holder.
(2.) A self insured certificate is merged into an other self insured certificate by Self Insurance Plans. The administrator shall run-off the liabilities of the non-surviving certificate for a five year period. At the end of the five year period, all remaining open claims will be merged into the 'new companies' liability report.
Note: When certifcate files are merged together, all new claims after the file certificate date shall be reported as claims of the surviving certificate holder.
(3) Location of Claims Records Information. The name and address of any location other than the current administrator where self insurance claims records are stored.
(4) Insurance Information. Name and policy number of any standard workers' compensation insurance policy, specific excess workers' compensation insurance policy, or aggregate worker's compensation insurance policy held by the self insurer along with policy issue date and retention levels of liability of the policies.
(5) Open Indemnity Claims Information. List of all open indemnity claims by reporting location by year, and alphabetically within each year.
(A) Show name of claimant, date of injury, description of injury, amount of benefits paid-to-date in indemnity and medical payments and estimated future liability of claim for indemnity and medical benefits.
Note: Computer Loss Runs showing the information requested and organized as set forth in this subsection will be acceptable in lieu of the open indemnity claim page in Appendix J-1 and J-2.
(B) Show any open claim reported to the carrier of a specific excess insurance policy, and for which the carrier has not denied in writing the claim liability in whole or part above the retention level of the policy. The listing to include the name of the claimant, claim number, date of injury, description of injury, carrier name and policy number, policy coverage period, retention level of policy and paid to date in indemnity or medical benefits, and the estimated future liability of the claim minus the total unpaid employer retention, which equals the total unpaid carrier liability. The listing must also state if the claim has been reported to a carrier, if the claim has been accepted by the carrier, if the carrier has denied any part of the liability of the claim.
1. Specific Excess Coverage Calculation. A calculation which includes a total of all unpaid carrier liability times the applicable deposit rate for the self insurer. This number will be included in the deposit calculation as provided for in Section 15251(b)(7).
(6) Deposit Calculation Information. A Deposit Calculation which includes the estimated future liability from the Liabilities Report times the deposit rate factor to determine a minimum deposit required for known liabilities; plus a deposit in advance for the current new year based on the average estimated future liability of claims for the past 5 years to secure average unpaid liability in the current year's new claims; less any credit for claims exceeding the retention level of any specific excess insurance policy for which the carrier has accepted liability in writing to arrive at the deposit required calculation. The total of the current security deposit is then subtracted from the minimum deposit required to determine if a deposit increase is due or a deposit decrease is indicated.
(7) Company Officer Certification Information. The name, title, address, phone number and original signature of the authorized company officer by Board Resolution to the certification that the report is true, correct and complete and acknowledging the company's responsibility to post and maintain the required security deposit that is due as a result of this report.
(c) For public self insurers, with or without a joint powers authority, the report shall be filed by October 1 of each year to cover liabilities during the July 1-June 30 fiscal year and shall include:
(1) General Information.
(A) Name and address of master certificate holder (individual agency or joint powers authority as applicable), federal tax identification number, and type of public agency.
(B) Agency name of affiliates and certificate numbers of all joint power's members.
(C) A certification by the individual public agency or joint powers authority official that the report is true, correct and complete.
(D) Notification of any reincorporation, merger, change in name or identity or any additions to the self insurance program by the master certificate holder or any subsidiary/affiliate company during the reporting period, and identification of any employees not included in the self insurance program.
(E) Name and address of person to whom all correspondence related to self insurance should be addressed.
(F) Employment and wages paid in that fiscal year as reported to Employment Development Department on the employer's Form DE-6 Quarterly Report.
Exception: A Certificate to Self Insure that is revoked is not required to submit this information.
(2) Liability Report and Administrator Information.
(A) A Liabilities Report which shall include:
(1.) All claims reported shall be on a fiscal year basis (starting July 1 and ending June 30 of the reporting years), with all claims reported on or before June 30 of each of the five prior fiscal years, showing indemnity and medical payments grouped as incurred liability, paid to date and future liability.
(2.) All open claims reported prior to the 5 years shall also be reported as required in (b)(2)(a)(1.), but in a single line entry.
(3.) Joint Powers Authorities (JPA) shall report the consolidated liabilities of all members of the JPA on one Liabilities Report.
(B) A Liabilities by Reporting Location Report is also required to be completed in full for each claims adjusting location.
Note1: A reporting location report is required to be submitted in addition to the consolidated report, if one certificate is merged into the file of a second certificate (i.e. merger of school districts).
(3) Claims Information for reporting year shall meet the requirements in subsection (b)(2)(A)(3.)-(4).
(A) List of all open indemnity claims for a Joint Powers Authority may be consolidated into a single listing for the entire JPA.
(4) Claims Administrator Information shall meet the requirements in subsection (b)(2)(A)(5.)-(7.).

(5) Location of Claims Records Information. The public self insurer shall comply with Section 15251(b)(3).
(6) Insurance Information. The public self insurer shall comply with Section 15251(b)(4).
(7) Open Indemnity Claims Information. The public self insurer shall comply with Section 15251(b)(5)(A)-(B).
(8) Funding of Liabilities Information.
(A) A Funding of Liabilities report for a self insured public entity without joint power authority membership shall include:
(1.) Method agency uses to fund the outstanding worker's compensation liabilities.
(2.) A statement indicating if the agency funds for incurred but not reported claims and if yes, the amount.
(3.) A statement indicating if the funding is set aside solely to pay the agency's workers' compensation liabilities, and if yes, the amount.
(4.) A statement indicating if the agency has an outside independent claims auditor review the case reserve practices and general claims management.
(5.) A statement indicating if the agency has an outside independent actuary to review future liability funding and the date of any such review.
(B) A Funding of Liabilities Report for each self-insured entity with joint power authority membership shall include:
(1.) Method joint power authority uses to fund the outstanding worker's compensation liabilities.
(2.) A statement indicating if the joint power authority sets aside aggregate funding for incurred but not reported claims.
(3.) A statement indicating if the joint power authority had an outside independent claims auditor review the claims.
(4.) A statement indicating if the joint power authority had an actuary study of the joint power authority's funding of worker's compensation liabilities by an outside, independent actuary.
(5.) A statement indicating if the joint power authority had an annual financial audit conducted by a certified public accountant.
(6.) A statement indicating who establishes the level of funding for the joint power authority worker's compensation claims.
(7.) A statement indicating if a member of the joint power authority can leave and take their claims liability and claims with them when they withdraw their membership.
(8.) A statement indicating if the joint power authority had authority under it governing document to assess joint power authority members for additional funding, if necessary.
(d) The Manager may, for good cause, require any self insurer to submit a Self Insurer's Annual Report covering a six-month interim period, in addition to the annual report specified in subsection (b) and (c) of this section.

(1) For private self insurers, such interim reports, when required, shall cover the period starting January 1 and ending June 30 of each year and shall be due on September 1 of each year.
(2) Public self insurer's interim reports shall cover July 1 through December 31 and shall be due on March 1 of each year.
(e) The Manager shall assess the civil penalty set forth in Labor Code Section 3702.9(a) against any self insurer for failure to file a complete and timely Self Insurer's Annual Report. Continued failure to file an Annual Report sixty days after assessment of civil penalties pursuant to Section 3702.9(a) shall be good cause for revocation of a certificate to self insure.
(f) For good cause shown by the self insurer or its administrative agency, the Manager may grant additional time to a self insurer to file the report without penalty.
(g) Unless otherwise approved by the Manager, the consolidated liabilities report (page 2 of the annual report) and reporting location reports (page 3 of the annual report) shall be signed by a competent person pursuant to Section 15452 of these regulations, in the employment of the self insurer or administrative agency for the self-insurance plan.
(1) The employer's certification on the Self Insurer's report shall be signed by:
(A) an officer or employee of the self insurer authorized by the Board of Director's Resolution to sign documents for self insurance matters; or
(B) an authorized public self insurer officer or employee; or
(C) an authorized officer or employee of the joint powers authority to which the public agency is a member; or
(D) an authorized officer or employee of the Self Insurer's Security Fund where the Director has turned over responsibility for an insolvent private self insurer's claim liability to the Fund pursuant to Labor Code Section 3701.5(c).

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3701.5, 3702.2, 3702.3, 3702.9 and 3702.10, Labor Code.

s 15252. Annual Report Form.

Note: Authority cited: Sections 54, 55 and 59, Labor Code. Reference: Sections 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15253. Late Annual Report Penalty.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55 and 3702.10, Labor Code.

s 15300. Estimating and Reporting Work Injury Claims.
(a) A list of open indemnity claims shall be submitted with each self insurer's annual report as required by Section 15251(b)(5)(A)-(B) and (c)(7).
(b) The administrator shall set a realistic estimate of future liability for each indemnity claim listed on the self insurer's annual report based on computations which reflect the probable total future cost of compensation and medical benefits due or that can reasonably expected to be due over the life of the claim. Each estimate listed on the self insurer's annual report shall be based on information in possession of the administrator at the-ending date of the period of time covered by the annual report. Estimated future liabilities listed on the annual report must represent the probable total future cost of compensation for the injury or disease based on information documented as in possession of the administrator at the ending date of the period of time covered by the annual report. In setting estimates of future liability, the administrator shall adhere to the following principles:
(1) Each estimate of future liability shall separately reflect an indemnity component and a medical component. The indemnity component shall include the estimated future cost of all temporary disability, permanent disability, death benefits including burial costs, and vocational rehabilitation including vendor costs. The medical component shall include the estimated future cost of all medical treatment, including costs of medical cost containment programs if those costs are allocated to the particular claim, and the estimated future cost of medical evaluations. Estimates of future liability shall include any increases in compensation in either component reasonably expected to be payable pursuant to Labor Code Sections 132a, 4553, and/or 5814.
(2) In estimating future permanent disability costs, where there are conflicting permanent disability ratings, the estimate shall be based on the higher rating unless there is sufficient evidence in the claim file to support a lower estimate.
(3) In estimating future medical costs where the injured worker's injury has not reached maximum medical improvement or permanent and stationary status, the estimate shall be based on projected costs for the total anticipated period of treatment throughout the life of the claim.
(4) In estimating future medical costs where the injured worker's injury has reached maximum medical improvement or permanent and stationary status, the estimate shall be based on average annual costs over the past three years since the injury reached maximum medical improvement or permanent and stationary status, or a lesser period if three years have not passed since the injury reached maximum medical improvement or permanent and stationary status, projected over the life expectancy of the injured worker. Estimates shall include any additional costs such as medical procedures or surgeries that can reasonably be expected over the life of the claim.
(5) Estimates based on average past costs shall be increased to include any costs that can reasonably be expected to occur that are not included within the averages. Estimates based on average past costs may be reduced to account for any treatment not reasonably expected to occur in the future based on medical documentation in possession of the administrator.
(6) Estimates of future medical costs based on average past costs shall not be reduced based on undocumented anticipated reductions in frequency of treatment or to reflect the substitution of treatments with a lower cost than utilized by the injured worker that may be available but that the injured worker is not utilizing. Estimates based on average past costs may be reduced based on reductions in the approved medical fee schedule and based on utilization review, except that reductions in estimates based on utilization review may not be reduced if the reductions are reasonably disputed. Estimates of future liability may be reduced based on the expectation of a third party recovery only in instances where an Order allowing credit has been issued pursuant to Labor Code Section 3861.
(7) Estimates of lifetime medical care and life pension benefits shall be determined based on the injured worker's life expectancy according to the most recent U.S. Life Expectancy Tables as reported by the U.S. Department of Health and Human Services, Centers for Disease Control and Prevention. Note: the most recent life expectancy tables can be found at http:// www.cdc.gov/nchs/datawh/nchsdefs/lifeexpectancy.htm.

(8) Estimates of permanent disability shall not be reduced based on apportionment unless the claim file includes documentation supporting apportionment.
(9) Estimates shall not be reduced to reflect present value of future benefits.
(c) All medical-only claims reported on the self insurer's annual report shall be estimated on the basis of computations which will develop the total future cost of medical benefits due or that can reasonably expected to be due based on information documented as in possession of the administrator at the ending date of the period of time covered by the annual report.
(d) Estimates of future liability shall not be decreased based on projected third party recoveries or projected reimbursements from aggregate excess insurance, nor shall reported paid costs be decreased based on third party recoveries or aggregate excess insurance reimbursements.
(e) The incurred liability estimate on known claims may be capped at the retention level of any specific excess workers' compensation insurance policy to the extent that each claim has not been denied in writing by the carrier. The self insurer's claims administrator shall list each claim covered by a specific excess insurance policy on Part VI-B of the Self Insurer's Annual Report. An adjustment to the total deposit required to be posted shall be made for claims covered by specific excess insurance policy on the annual report to the extent that they meet the requirements in Section 15251(b)(5)(B) of these regulations.
(f) Estimates of incurred liability, payments-made-to-date and estimated future liability of all compensation benefits shall be made immediately available at the time of audit if not already documented in the claim file, or when requested by the Manager.
(g) The administrator shall adjust the estimate immediately upon receipt of medical reports, orders of the Appeals Board, or other relevant information that affects the valuation of the claim. Each estimate shall be reviewed no less than annually. Estimates set by a prior administrator shall be reviewed by the current administrator before filing the Self Insurer's Annual Report.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 132a, 3700, 3702.3, 3702.6, 3702.10, 3703, 3740-3745, 3861, 4553 and 5814, Labor Code.

s 15301. Revision of Estimates.
The Manager shall have authority to revise private sector self insurer's estimates when information from any relevant source in the Manager's possession indicates the estimates are inaccurate or inadequate. Deposit recalculations shall be made at the same time or after the self-insurer has been notified of the Manager's revisions and given an opportunity to object to the increases in deposit or revision to liability estimates.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701.5, 3702.3, 3702.6, 3702.10 and 3740-3745, Labor Code.

s 15302. Medical Reports.
The Manager, when deemed necessary for proper administration of self-insurance, may require a self-insurer to provide a true copy of any relevant medical report in the possession of the self-insurer, its agent, or representative.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10 and 3740-3745, Labor Code.

s 15303. Medical, Surgical, Hospital Contract.
No contract for medical, surgical, or hospital services shall relieve the self-insurer from reporting the total future determined and estimated cost of said services in accordance with Section 15300 of these regulations. For purposes of this section, a valid and effective policy of workers' compensation insurance providing for full payment of medical, surgical, or hospital services shall not be construed as a contract for medical, surgical, or hospital services.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702.3, 3702.6, 3703 and 3740-3745, Labor Code.

s 15350. Validity of Certificate.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15350.1. Certificate.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15350.2. Notice to Employees.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15350.5. Non-Permitted Use.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15351. Extent of Coverage.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15352. Permitted Insurance.

Note: Authority cited: Sections 54 and 55, Labor Code. Reference: Sections 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15353. Injury and Illness Prevention Program.
(a) As part of the application process, a private sector applicant for a Certificate to Self-Insure shall provide one of the following:
(1) an independent evaluation of the applicant employer's injury and illness prevention program as set forth in Labor Code Section 6314.5 and 6401.7 and Section 3203 of Title 8, California Code of Regulations prepared by an independent, licensed, California professional engineer, or a Certified Safety Professional, and/or a Certified Industrial Hygienist.

(A) The evaluation preparer shall be considered independent if: (i) the preparer or the preparer's firm has had no business dealings with the applicant employer or its owner for the prior two years; (ii) the preparer is not or has not been employed by the applicant employer's present or prior insurance carrier or insurance broker during the past 5 years; and (iii) the preparer or preparer's firm has not been employed by the applicant employer or its parent in a safety and health or accident prevention capacity during the past 5 years.
(B) The evaluation report preparer shall disclose any such business relationships noted in subsection (a)(1)(A) of this Section in the evaluation report. The Manager shall reject a submitted evaluation report where a conflict of interest may exist between the evaluation preparer and the applicant employer as set forth in Subsection (1)(1)(A); or
(2) Written report or citation of a Division of Occupational Safety and Health (DOSH) inspection of the applicant employer's injury and illness prevention program pursuant to Labor Code Sections 6314.5 and 6401.7 and Section 3203 of Title 8, California Code of Regulations. The Division of Occupational Safety and Health (DOSH) inspection shall have been conducted within 120 days of the date of application to become self insured.
(b) An evaluation report pursuant to subsection (a) that shows the applicant for a Certificate to Self Insure to be without an effective injury prevention program shall be good cause for denial of the application for self insurance by the Director without prejudice to reapplication at a later date.
(c) The applicant employer must abate all serious violations found in the safety and health evaluation report. Written verification of abatement must be sent from the evaluation preparer to Self Insurance Plans.
Note: The pamphlet "A sample of an Injury and Illness Prevention Program" can be obtained from the Cal/OSHA Consultation Services.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3702, 3702.10, 6314.5, 6319 and 6401.7, Labor Code.

s 15354. Willful or Repeat Violation of Injury Prevention Program by a Self Insurer.
Any private employer self insurer identified to the Director by the Division of Occupational Safety and Health pursuant to Labor Code Section 6319(f) shall provide proof of abatement of the repeat or willful violation of Section 3203 of Title 8, California Code of Regulations to the Manager. Failure to abate shall be good cause to revoke the Certificate to Self Insure issued to that self insurer after the opportunity for a hearing before the Director.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 3700, 3702, 3702.10, 6314.5, 6319 and 6401.7, Labor Code.

s 15360. Transfer of Claim Liabilities.
A current or former self insurer may transfer claim liabilities to a third party as set forth in subsections (a) through (e) of this section.
(a) Self-insured workers' compensation claim liabilities cannot be transferred to another entity without first applying for and receiving permission from the Director. Except as provided in Labor Code Section 3702.8(c), the claim liabilities being transferred shall be assumed and guaranteed with the standard Agreement of Assumption and Guarantee of Liabilities as provided for in Section 15211.2 of these regulations, with an assumption resolution executed by the Board of Directors if a corporation, by the general partners if a partnership, or by the owners if a sole proprietorship of the entity taking over the liabilities.
(1) The new holder of claim liabilities shall post the security deposit determined necessary by the Manager pursuant to Article 3 of these regulations.
(2) The Manager shall be provided with copies of the necessary documents involved in a sale or transfer of claim liabilities from a self-insurer to another party.
(3) All other duties of a self insured employer in Labor Code Section 3702.8(a) shall be complied with by the self insured employer.
(b) The Manager may authorize the contractual transfer of claim liabilities, other than through a special excess worker's compensation insurance policy, from a self-insurer to an admitted worker's compensation insurance carrier provided:
(1) A copy of the signed contract between the self-insurer and carrier is provided to the Manager;
(2) The self-insurer continues to post the amount of deposit required by the Manager pursuant to Article 3 of these regulations;
(3) The claims contractually transferred to the carrier are administered in California by an admitted carrier or by a administrative agency holding a Certificate to Administer;
(4) Self Insurer's Annual Reports are submitted by the self-insurer as required by these regulations until all claims are resolved; and
(5) All other duties of a self insurer in Labor Code Section 3702.8(a) are complied with by the self insured employer.
(c) Where a former self-insurer transfers liabilities to a carrier via a special excess workers' compensation insurance policy as provided in Labor Code Section 3702.8(c), but no carrier performance bond is posted, the self-insurer's security deposit shall be held for three years before release.
(d) Claim liabilities of a member public agency of a pooling workers' compensation joint powers authority may be transferred if:
(1) The joint powers authority agreement permits a member public agency to take their claim liabilities out of the joint powers authority pool if the public agency elects to do so;
(2) The public agency member elects to transfer its claim liability; and
(3) The claims are transferred to another workers' compensation joint authority, or to a self administered or administrative agency administered or carrier administered self insurance program.
(e) Private group self insurers and their group members claim liabilities shall not be transferred and shall remain the liability of the group self insurer.
Exception: Claim liabilities of a former group member may be transferred pursuant to Labor Code Section 3702.8(c).

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3702.8, 3703, 3705 and 3740-3745, Labor Code.

s 15361. Cessation of Business, Etc.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55 and 3702.10, Labor Code.

s 15361.5. Workers' Compensation Liabilities.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3702.8, 3703, 3705and 3740-3745, Labor Code.

s 15362. Termination of Surety Bond.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55 and 3702.10, Labor Code.

s 15400. Claim File.
(a) Every self-insurer or its administrative agency shall keep a claim file of each indemnity and medical-only work-injury occurring on or after January 1, 1990, in accordance with Title 8, Section 10101 and Section 10101.1.
(b) For work injuries occurring prior to January 1, 1990, every self insurer shall keep a claim file including those claims which were denied. Said claim file shall contain, but not be limited to, a copy of:

(1) Employers Report of Occupational Injury or Illness, Form No. 5020;
(2) Every report made to the Administrative Director of the Division of Industrial Accidents; including but not limited to the letter of denial to the employee;
(3) Doctor's First Report of Occupational Injury or Illness, Form No. 5021;
(4) Every subsequent relevant medical report;
(5) All applicable orders of the Workers' Compensation Appeals Board and reports relating thereto;
(6) A record of payment of compensation benefits as compensation is defined in Section 3207 of the Labor Code, together with a record of the periods covered by disability payments, including a copy of DIA Form 500, Notice of Termination of Benefits;
(c) For injuries reported on or after January 1, 2006, each self administering self insurer and claims administrative agency shall maintain a claim file for each indemnity and medical-only claim, including denied claims, and shall ensure that each file is complete and current for each claim. Contents of claim files may be in hard copy, in electronic form, or some combination of hard copy and electronic form. Files maintained in hard copy shall be in chronological order with the most recently dated documents on top, or subdivided into sections such as medical reports, benefit notices, correspondence, claim notes, and vocational rehabilitation. In addition to the contents specified in Title 8, California Code of Regulations, Section 10101.1, each indemnity file shall contain itemized written documentation showing the basis for the calculation of estimated future liability and for each change in estimated future liability for the claim. Files or portions of files maintained in electronic form shall be easily retrievable.

Note: Authority cited: Sections 54, 55, 59 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3700(b), 3701, 3702, 3702.1, 3702.5, 3702.6, 3703, 3704 and 3705, Labor Code.

s 15400.1. Claim Log.
(a) After January 1, 1993, every self-insurer or its administrative agency shall maintain:
(1) a manually prepared log of all work injury claims for each self-insurer at each adjusting location in accordance with Title 8, Section 10103 and 10103.1; or
(2) a computerized log of claims for each self-insurer at each adjusting location in accordance with Title 8, Section 10103 and 10103.1.
(b) The claim log shall be maintained at each of the self-insurer's or its administrative agency's claims adjusting locations. The claim log at each location shall be kept current and shall include all claims reported to the adjusting location.
(c) A claim log shall be found to be materially deficient if it fails to contain the elements of Title 8, Section 10103 and 10103.1; or fails to include all reported claims; or is not provided to the Manager or any subsequent administrator in readable form.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.1 and 3702.10, Labor Code.

s 15400.2. Maintenance of Records.
(a) All claim files shall be kept and maintained for a period of five years from the date of injury or from the date on which the last provision of compensation benefits occurred as defined in Labor Code Section 3207, whichever is later. Claim files with awards for future benefits shall not be destroyed, but two years after the date of the last provision of workers' compensation benefits as defined in Labor Code Section 3207, they may be converted to an inactive or closed status by the administrator, but only if there is no reasonable expectation that future benefits will be claimed or provided.
(b) Inactive and closed claim files may be microfilmed for storage, however, the original paper files shall be maintained for at least two years after the claim has been closed or become inactive. Such microfilmed files must be readily reproducible into legible paper form if requested by the Manager for audit.
(c) All claim files and the claim logs shall be kept and maintained in California unless the Manager has given written approval to a self insurer or former self insurer to administer its workers' compensation self-insurance plan from a location outside of California.
(d) All claim files and claim logs, together with records of all compensation benefit payments, shall be readily available for inspection by the Manager or his representative.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.1 and 3702.10, Labor Code.

s 15400.3. Maintenance of Records.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 55 and 3702.10, Labor Code.

s 15401. Self-Insurance Plan Administration.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 55 and 3702.10, Labor Code.

s 15401.1. Competence.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 55 and 3702.10, Labor Code.

s 15401.2. Competency at Adjusting Location.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59 and 3702.10, Labor Code.

s 15402. Notice of Change of Administrator and Location of Records.
(a) Each self-insurer or administrative agency shall annually report on the Self Insurer's Annual Report form to the Manager the name, title, and office address of the person or persons appointed to administer the employer's self-insurance plan and of the location or locations of records required to be kept and maintained pursuant to Section 15400 of these regulations.
(b) The new administrator shall report any changes of the administrative agency administering the employer's self-insurance plan or any change of location or locations of records in writing to the Manager no later than the date of such change.
NOTE: Reporting required by subsection (b) may be done by submitting a "Report of Changes" on the appropriate Division of Workers' Compensation AE Form 101 or AE Form 102 (see Plate L-1 and L-2 of the Appendix.)

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.1 and 3702.10, Labor Code.

s 15402.1. Self Insurer's Interim Report.
(a) A self-insurer and its administrative agency shall jointly submit to the Manager a self-insurer's annual report, covering any interim period between regularly scheduled reporting periods whenever any of the following changes occur in the administration of the employer's self insurance plan:
(1) A change from an agency-administered plan to another agency-administered plan, (i.e. from one third party administrator to another third party administrator);

(2) A change from an agency-administered plan to a self-administered plan;
(3) A change from a self-administered plan to an agency-administered plan; or
(b) The interim Self Insurers Annual Report shall be made by the former administrator on the applicable form as required by Section 15251 of these regulations, showing the self-insurer's claims experience as of the date of the change of administrative agencies.
(c) The interim self insurer's annual report shall be due within thirty (30) days of the change of administrators. The self insurer shall provide a copy to the new administrator and three (3) copies to the Manager. The Manager may supply the new administrator with a copy of the interim report.
(d) The new administrator shall submit the year end self insurer's annual report for the self insurer which includes the total loss experience of all open and closed claims from all administrative agencies handling the self insurer's claims during the reporting period.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.1, 3702.2 and 3702.10, Labor Code.

s 15402.2. Report of Transfer of Records.
(a) After July 1, 1992, at the time of a change of administration of a self insurance plan, as set forth in Section 15402.1(a) of these regulations, the former administrative agency or previously self administering self insurer shall submit to the Manager and to the new administrative agency a written report containing the following:
(1) A list of all open and closed claims for the self insurer in the possession of the former administrative agency as of the date of the transfer; and

(2) A written description of the physical location of all claim files, the required claim logs, and any computer data files of the self insurer's plan. Physical location shall include claim files sent to storage and where stored; files sent to the self insurer; and files sent to the new administrator.
(b) Except where specified in a contractual agreement between the self insurer and the former administrative agency, all claim files, claim logs and computerized data files shall be the property of the self insurer and shall be returned to the self insurer or delivered to the new administrator or administrative agency designated by the self insurer.
(c) Failure of an administrative agency or self insurer to provide a Report of Transfer of Records as set forth in this section may be good cause for revocation of a certificate to administer.

Note: Authority cited: Sections 54, 55, 59 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3700(b), 3701, 3702, 3702.1, 3702.2, 3702.5, 3702.6, 3702.7, 3702.10, 3703, 3704 and 3705, Labor Code.

s 15402.3. Notice of Change of Membership in a Joint Powers Authority or in a Private Group Self Insurer.
(a) The joint powers authority shall notify the Manager when a Public entity with an affiliate certificate to self insure changes its membership from the existing joint powers authority to
(1) another joint powers authority;
(2) a carrier insured plan or;

(3) an independent self insured plan.
(b) The group administrator of each private group self insurer shall notify the Manager when any group member holding an Affiliate Certificate changes its membership from the existing group self insurer to:
(1) another private group self insurer;
(2) a carrier insured plan; or
(3) an independent self insured plan.
(c) The Manager shall be notified no later than the date of such change.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3702.5 and 3702.10, Labor Code.

s 15402.4. Transfer of Claim Files and Computerized Claim File Data Information.
(a) Upon change of an administrative agency, all open claims shall be transferred immediately to the new administrative agency, unless otherwise provided by agreement between the self insurer, former administrator and new administrator.
(b) All closed claim files in the possession of the former administrator shall be transferred to the new administrator within 30 days, unless otherwise provided by agreement between the self insurer, former administrator and new administrator.
(c) All computerized claim file data showing all historical claim information, including payments and reserve data as of the date of the transfer of the open claim files shall be provided by the former administrator on the date that all open claim files are transferred, unless otherwise provided for by written agreement between the self insurer, former administrator and the new administrator. In the event that an agreement precludes the transfer of electronic claim contents of claims being transferred to the new administrator, the former administrator will provide hard copies of any required contents to the new administrator at its own expense. The closing date of the transactions on the computerized data shall coincide with the date of the physical transfer of the claim files to the new administrator. In the event that computerized data pertaining to the specific administration is changed by the former administrator after the physical claims have been transferred and the data provided to the new administrator, the former administrator shall provide reported computerized information to the new administrator within 14 days of any such changes.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.1 and 3702.10, Labor Code.

s 15403. Audits.
(a) Pursuant to Labor Code Sections 129 and 3702.6, the Manager may order an audit of any self insurer or individual claim file at such reasonable times as is deemed necessary. Such audits shall include, but not be limited to, an audit of the files and records required by Section 15400 of these regulations. Such files and records shall be made readily available by the self insured employer or its administrative agency.
(b) In the event of an audit, the Manager may require that claims administered at the home of a telecommuting adjuster be presented for audit at a California office location of the administrator, or at a California location of the self insured employer.

Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702 and 3702.6, Labor Code. (continued)