South Dakota Codified Laws 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;
Terms Used In South Dakota Codified Laws 58-20-28
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.
(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.