SENATE BILL REPORT

HB 2485

BYRepresentatives Rector, Vekich, Prentice, Leonard, Jones and Dellwo

Qualifying as a self-insurer of industrial insurance.

House Committe on Commerce & Labor

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 19, 1990; February 22, 1990

Majority Report:  Do pass.

      Signed by Senators Lee, Chairman; Anderson, Vice Chairman; McMullen, Matson, Saling, Smitherman, Warnke, Williams.

Senate Staff:Dave Cheal (786-7576)

                  February 23, 1990

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 22, 1990

BACKGROUND:

Qualified employers are allowed to self-insure their workers' compensation programs.  To obtain certification as a self-insurer, an employer must establish to the director of the Department of Labor and Industries' satisfaction that the employer has sufficient financial resources to meet all present and future obligations under the industrial insurance law.  The department may also require a self-insurer to supplement its financial ability by depositing cash, securities, or a surety bond in an escrow account.

Information contained in industrial insurance claim files is confidential.  Specific exemptions to the confidentiality requirement are provided for treating physicians, the worker's employer, and department personnel.  The injured worker may receive information from the file only through an authorized representative.

SUMMARY:

Beginning January 1, 1991, qualified self-insurers may deposit an irrevocable letter of credit (other options are money, securities, or a bond) to guarantee their future ability to meet industrial insurance obligations.  The issuer of the letter of credit must be a state or federally chartered bank authorized to do business in Washington.  To qualify for the letter of credit option, self-insurers must have a net worth of not less than $500 million and meet any requirements adopted by the Department of Labor and Industries.  The option is not available to self-insurers who are public employers.

Injured workers may review their claim files if the director determines, pursuant to criteria in department rules, that the review is in the claimant's interest.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Effective Date:Section 1 of the bill takes effect on January 1, 1991.

Senate Committee - Testified: Jeff Johnson, WSLC; Melanie Stewart, Washington Self Ins. Assoc.; Jody Moran, Labor and Industries; Max Vekian (pro); Basil Bradley, AIA (pro); Clif Finch, AWB