SENATE BILL NO. 5679
C 190 L 89
State of Washington 51st Legislature 1989 Regular Session
By Senators von Reichbauer, Moore, Sellar and McMullen; by request of Insurance Commissioner
Read first time 2/1/89 and referred to Committee on Financial Institutions & Insurance.
AN ACT Relating to industrial insurance funds; and amending RCW 51.44.070 and 51.44.080.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1. Section 51.44.070, chapter 23, Laws of 1961 as last amended by section 1, chapter 312, Laws of 1983 and RCW 51.44.070 are each amended to read as follows:
every case resulting in death or permanent total disability the department
shall transfer on its books from the accident fund of the proper class and/or
appropriate account to the "reserve fund" a sum of money for that
case equal to the estimated present cash value of the monthly payments provided
for it, to be calculated upon the basis of an annuity covering the payments in
this title provided to be made for the case. Such annuity values shall be
based upon rates of mortality, disability, remarriage, and interest as
determined by the ((
state insurance commissioner)) department,
taking into account the experience of the reserve fund in such respects.
Similarly, a self-insurer in these circumstances shall pay into the reserve fund a sum of money computed in the same manner, and the disbursements therefrom shall be made as in other cases.
(2) As an
alternative to payment procedures otherwise provided under law, in the event of
death or permanent total disability to workers of self-insured employers, a
self-insured employer may upon establishment of such obligation file with the
department a bond, or an assignment of account from a federally or state
chartered commercial banking institution authorized to conduct business in the
state of Washington, in an amount deemed by the ((
department to be reasonably sufficient to insure payment of the pension
benefits provided by law. The department shall adopt rules governing
assignments of account. Such rules shall ensure that the funds are available
if needed, even in the case of failure of the banking institution or of the
value for every such case shall be determined by the ((
commissioner)) department based upon the (( commissioner's)) department's
experience as to rates of mortality, disability, remarriage, and interest. The
amount of the required bond or assignment of account may be reviewed and
adjusted periodically by the department, based upon periodic redeterminations
by the (( insurance commissioner)) department as to the
outstanding annuity value for the case.
Under such alternative, the department shall make the monthly payments from the pension reserve fund for the benefits provided for by RCW 51.32.050 and 51.32.060 to the self-insured beneficiary or beneficiaries and the department shall be reimbursed for all such payments from the particular self-insured employer through periodic charges not less than quarterly in a manner to be determined by the director.
Any self-insured employer electing this alternative method of providing for payment to the beneficiary or beneficiaries shall additionally pay to the department a deposit equal to the first three months' payments otherwise required under RCW 51.32.050 and 51.32.060. Such deposit shall be placed in the reserve fund in accordance with RCW 51.44.140 and shall be returned to the respective self-insured employer when monthly payments are no longer required for such particular obligation.
If a self-insurer delays or refuses to reimburse the department beyond fifteen days after the reimbursement charges become due, there shall be a penalty paid by the self-insurer upon order of the director of an additional amount equal to twenty-five percent of the amount then due which shall be paid into the pension reserve fund. Such an order shall conform to the requirements of RCW 51.52.050.
Sec. 2. Section 51.44.080, chapter 23, Laws of 1961 as last amended by section 8, chapter 161, Laws of 1988 and RCW 51.44.080 are each amended to read as follows:
department shall notify the state treasurer from time to time, of such
transfers as a whole from the state fund to the reserve fund and the interest
or other earnings of the reserve fund shall become a part of the reserve fund
itself. As soon as possible after June 30th of each year the ((
insurance commissioner)) department shall expert the reserve fund to
ascertain its standing as of June 30th of that year and the relation of its
outstanding annuities at their then value to the cash on hand or at interest
belonging to the fund. (( He)) The department shall promptly
report the result of (( his)) the examination to (( the
department and to)) the state treasurer in writing not later than September
30th following. If the report shows that there was on said June 30th, in the
reserve fund in cash or at interest, a greater sum than the then annuity value
of the outstanding pension obligations, the surplus shall be forthwith turned
over to the state fund but, if the report shows the contrary condition of the
reserve fund, the deficiency shall be forthwith made good out of the state