In accordance with Section 34A-2-103, a client is responsible for securing workers’ compensation coverage for a covered employee.
Terms Used In Utah Code 31A-40-209
Client: means a person who enters into a professional employer agreement with a professional employer organization. See Utah Code 31A-40-102
Covered employee: means an individual who has a coemployment relationship with a client and a professional employer organization if the conditions of Section 31A-40-203 are met. See Utah Code 31A-40-102
Employee: means :
(a)
an individual employed by an employer; or
(b)
an individual who meets the requirements of Subsection (53)(b). See Utah Code 31A-1-301
Endorsement: means a written agreement attached to a policy or certificate to modify the policy or certificate coverage. See Utah Code 31A-1-301
a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
(ii)
a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
(iii)
a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
Insured: means a person to whom or for whose benefit an insurer makes a promise in an insurance policy and includes:
professional employer organization: means a person engaged in the business of providing a professional employer service. See Utah Code 31A-40-102
(2)
Subject to the requirements of Section 34A-2-103, if a professional employer organization obtains or assists a client in obtaining workers’ compensation insurance pursuant to a professional employer agreement:
(a)
the professional employer organization shall ensure that the client maintains and provides workers’ compensation coverage for a covered employee in accordance with Subsection 34A-2-201(1) and rules of the Labor Commission, made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
(b)
the workers’ compensation coverage may show the professional employer organization as the named insured through a master policy, if:
(i)
the client is shown as an insured by means of an endorsement for each individual client;
(ii)
the experience modification of a client is used; and
at the termination of the professional employer agreement, if requested by the client, the insurer shall provide the client records regarding the loss experience related to workers’ compensation insurance provided to a covered employee pursuant to the professional employer agreement; and
(d)
the insurer shall notify a client if the workers’ compensation coverage for the client is terminated.
(3)
In accordance with Section 34A-2-105, the exclusive remedy provisions of Section 34A-2-105 apply to both the client and the professional employer organization under a professional employer agreement regulated under this chapter.
(4)
Notwithstanding the other provisions in this section, an insurer may choose whether to issue:
(a)
a policy for a client; or
(b)
a master policy with the client shown as an additional insured by means of an individual endorsement.
