Guaranty fund - immediate payment fund - legislative declaration

8-44-206. Guaranty fund - immediate payment fund - legislative declaration. (1) The general assembly hereby finds and declares that benefits awarded under articles 40 to 47 of this title to claimants employed by self-insurers may be unreasonably delayed or not paid at all if receipt of the proceeds of the bond required of the self-insurer is delayed or if the self-insurer declares bankruptcy or has insufficient reserves to cover the claim. The general assembly further finds and declares that the creation of an immediate payment fund and a guaranty fund will assure prompt and complete payment of benefits awarded to such claimants. (2) Repealed. (3) Immediate payment fund - assessments - creation of fund. (a) The director shall impose an assessment upon each employer self-insured under section 8-44-201. Assessments under this subsection (3) shall be based upon a ratio equal to the self-insured employer's paid workers' compensation medical and indemnity losses for the most recent self-insurance permit year divided by the aggregate sum of paid medical and indemnity losses by all self-insured employers for that year. Such losses shall be determined on July 1, 1990, for the most recently completed permit year, and on the first day of July for each year thereafter until the minimum fund balance has been reached. Contributions to the fund shall not be assets of the self-insured employer. (b) (I) All moneys received by the executive director pursuant to this subsection (3) shall be deposited in the state treasury in the immediate payment fund, which fund is hereby created, and all moneys credited to such fund shall be used solely for the administration and payment of benefits to employees pursuant to this section. The general assembly shall make annual appropriations out of such fund for the administration of the fund. The moneys in such fund for the payment of benefits are hereby continuously appropriated to the department for payment of such benefits. Any moneys not utilized in the fund shall not revert to the general fund. (II) The minimum fund balance shall be three hundred thousand dollars, to be assessed during the first three years at the rate of one hundred thousand dollars annually. Interest shall accrue to the fund to a maximum fund balance of one million dollars. Thereafter, the fund balance shall be maintained at one million dollars by refunding the excess funds to each self-insured employer, on a pro rata basis, based on that employer's contribution. (4) Guaranty fund - assessments - creation of fund. (a) When the director determines that existing security held by an employer self-insured under section 8-44-201 is insufficient to meet its existing liability for workers' compensation benefits, the director shall impose an assessment on each self-insured employer. The assessment shall be based on a ratio which equals each self-insured employer's paid workers' compensation medical and indemnity losses for the most recent self-insurance permit year divided by the aggregate sum of paid medical and indemnity losses by all self-insured employers for that year. If necessary, the executive director may direct the director to make an annual assessment thereafter until such time as the present value of the guaranty fund, created in subsection (4)(b) of this section, equals the total liability for workers' compensation benefits which are in excess of the security held by the defaulting self-insured employers. (b) (I) All moneys received by the executive director pursuant to this subsection (4) shall be deposited in the state treasury in the guaranty fund, which fund is hereby created. Such moneys credited to the fund shall be used solely for the administration and payment of benefits to employees pursuant to this section. The general assembly shall make annual appropriations out of such fund for the administration of the fund. The moneys in such fund for the payment of benefits are hereby continuously appropriated to the department for payment of such benefits. Any moneys not utilized in the fund shall not revert to the general fund. (II) All interest shall accrue to the fund. No amounts shall be refunded until all liability in excess of security held by self-insured employers has been discharged and until the dates imposing limitations on actions, as specified in sections 8-43-103 and 8-43-303, have passed. When those conditions have been met, the remaining moneys in the fund shall be refunded to each self-insured employer, on a pro rata basis, based on that employer's contribution. (c) Public entities self-insuring under section 8-44-201 shall be exempt from and shall not participate in this subsection (4). (5) The department shall select any claims administrators required under this section based on the qualifications and requirements established by the director. For the purpose of contracting for such services, the department shall not be subject to articles 101 to 114 of title 24. Source: L. 90: Entire section added, p. 581, � 1, effective July 1. L. 92: (3)(b)(I) and (4)(b)(I) amended, p. 1808, � 1, effective March 19. L. 2022: (2) amended, (SB 22-013), ch. 2, p. 6, � 5, effective February 25; (2) repealed and (3)(a), (4)(a), and (5) amended, (HB 22-1347), ch. 477, p. 3475, � 5, effective August 10; (2)(a) amended, (SB 22-162), ch. 469, p. 3384, � 90, effective August 10. Editor's note: Subsection (2) was amended in SB 22-013 and SB 22-162. Those amendments were superseded by the repeal of subsection (2) in HB 22-1347, effective August 10, 2022. For the amendments to subsection (2) in SB 22-013 in effect from February 25, 2022, to August 10, 2022, see chapter 2, Session Laws of Colorado 2022. (L. 2022, p. 6.) Cross references: For the short title (the Debbie Haskins 'Administrative Organization Act of 1968' Modernization Act) in SB 22-162, see section 1 of chapter 469, Session Laws of Colorado 2022. ARTICLE 45 Pinnacol Assurance Editor's note: This article was numbered as article 6 of chapter 81, C.R.S. 1963. The substantive provisions of this article were repealed and reenacted in 1990, resulting in the addition, relocation, and elimination of sections as well as subject matter. For amendments to this article prior to 1990, consult the Colorado statutory research explanatory note and the table itemizing the replacement volumes and supplements to the original volume of C.R.S. 1973 beginning on page vii in the front of this volume. Former C.R.S. section numbers are shown in editors' notes following those sections that were relocated. For a detailed comparison of this article, see the comparative tables located in the back of the index.