(a) Employers, except the State, any county or political subdivision of the State, or other public entity within the State, shall secure compensation to their employees in one of the following ways:

Attorney's Note

Under the Hawaii Revised Statutes, punishments for crimes depend on the classification. In the case of this section:
ClassPrisonFine
misdemeanorup to 1 year$2,000
For details, see Haw. Rev. Stat. § 706-663
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Terms Used In Hawaii Revised Statutes 386-121

  • Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
  • Compensation: means all benefits accorded by this chapter to an employee or the employee's dependents on account of a work injury as defined in this section; it includes medical and rehabilitation benefits, income and indemnity benefits in cases of disability or death, and the allowance for funeral and burial expenses. See Hawaii Revised Statutes 386-1
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • county: includes the city and county of Honolulu. See Hawaii Revised Statutes 1-22
  • Director: means the director of labor and industrial relations. See Hawaii Revised Statutes 386-1
  • Employer: means any person having one or more persons in the person's employment. See Hawaii Revised Statutes 386-1
  • Good cause: means a substantial reason amounting in law to be a legal excuse for failing to perform an act required by law considered under the circumstances of the individual case. See Hawaii Revised Statutes 386-1
(1) By insuring and keeping insured the payment of compensation with any stock, mutual, reciprocal, or other insurer authorized to transact the business of workers’ compensation insurance in the State;
(2) By depositing and maintaining with the state director of finance security satisfactory to the director of labor and industrial relations securing the payment by the employer of compensation according to the terms of this chapter;
(3) Upon furnishing satisfactory proof to the director of the employer’s solvency and financial ability to pay the compensation and benefits herein provided, no insurance or security shall be required, and the employer shall make payments directly to the employer’s employees, as they may become entitled to receive the same under the terms and conditions of this chapter;
(4) An employer desiring to maintain security for payment of compensation under this section shall file an application with the director on a form provided for this purpose together with the employer’s most current audited annual financial statement;
(5) Where an applicant for self-insurance is a subsidiary and the subsidiary cannot submit an independent current audited annual financial statement, an indemnity agreement approved as to form and content by the director shall be executed by the parent corporation of the subsidiary and submitted with its application;
(6) Each self-insurance authorization shall be effective from the date of issuance until June 30 of each calendar year;
(7) A notice of intention to cancel self-insurance shall be submitted in writing to the director within at least thirty days prior to the effective date of cancellation;
(8) A self-insurance authorization may be revoked by the director for good cause shown upon notification in writing to the self-insurer;
(9) By membership in a workers’ compensation self-insurance group with a valid certificate of approval under section 386-194; or
(10) By membership in a workers’ compensation group insured by a captive insurer under chapter 431, article 19.

Any person who wilfully misrepresents any fact in order to obtain the benefits of paragraph (3) shall be guilty of a misdemeanor.

(b) Any decision of the director rendered under paragraphs (2) and (3) of subsection (a) of this section with respect to the amount of security required or refusing to permit no security to be given shall be subject to review on appeal in conformity with §§ 386-87 and 386-88.

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