Compilation of Rules and Regulations of the State of Georgia
Department 120 - OFFICE OF COMMISSIONER OF INSURANCE, SAFETY FIRE COMMISSIONER AND INDUSTRIAL LOAN COMMISSIONER
Chapter 120-2 - RULES OF COMMISSIONER OF INSURANCE
Subject 120-2-34 - GROUP SELF-INSURANCE FUNDS
Rule 120-2-34-.16 - Specific and Aggregate Excess Insurance Program

Universal Citation: GA Rules and Regs r 120-2-34-.16

Current through Rules and Regulations filed through September 23, 2024

(1) The Fund shall maintain a specific and aggregate excess loss funding program acceptable to the Commissioner.

(2) A Fund shall submit a plan for funding excess losses which, in the opinion of the Commissioner, provides for stability and protection to the Fund members. Any subsequent changes relating to coverages, terms and/or conditions of coverage, including loss fund and retention level, shall be submitted to the Commissioner for approval shall be submitted thirty (30) days prior to their expected use. The Commissioner shall approve or disapprove submitted plans within thirty (30) days of receipt. If the Commissioner fails to approve or disapprove such plan within thirty (30) days, a Fund may use such plan. However, the Commissioner may require a Fund to resubmit the Fund's excess loss funding plan upon written request to the Fund or the Fund's administrator of record. Upon request, a Fund shall resubmit their excess loss funding program to the Commissioner for approval.

(3) The Fund may submit a plan which has been developed or reviewed by an actuary who is a Member of the Casualty Actuarial Society and a Member of the American Academy of Actuaries. Plans developed or reviewed by actuaries may utilize alternative funding techniques including pledging of a Fund's unobligated surplus, spread loss programs or other programs which, in the opinion of the actuary, shall not unduly jeopardize the Fund's stability.

(4) Any plan submitted by a Fund to the Commissioner for approval of an excess loss funding program which is not supported by detailed actuarial analysis by an actuary who is a Member of the Casualty Actuarial Society and a Member of the American Academy of Actuaries shall include:

(a) Specific Excess insurance with minimum coverage limits of $2,000,000 per occurrence or in such greater limits as may be required by the Commissioner in order to assure stability of the Fund; and,

(b) Aggregate Excess Insurance with minimum annual aggregate coverage limits of $1,000,000 or such greater limits as may be required by the Commissioner; and,

(c) An attachment point for the Specific Excess Insurance of no greater than $350,000 per occurrence. A Fund may apply for such higher attachment points that, in the opinion of the Commissioner, will not unduly jeopardize the Fund's stability. If a higher attachment point is requested, the application shall be made 30 days in advance of the intended change but does not mandate that such change be effectuated. And,

(d) An attachment point for the Aggregate Excess Insurance no greater than the Fund's normal annual premium plus investment income less the Fund's administrative expenses. A Fund may apply for a higher attachment point for the Aggregate Excess Insurance that, in the opinion of the Commissioner, will not unduly jeopardize the Fund's stability. If a higher attachment point is requested, the application shall be made 30 days in advance of the intended change but does not mandate that such change be effectuated.

(5) Any policy of insurance written for the benefit of a Fund in accordance with this rule shall contain the following:

(a) A provision that cancellation or termination of the policy is not effective except upon sixty (60) days written notice by certified or registered mail to the Fund and to the Commissioner; and,

(b) A provision that the policy shall be automatically renewed at the expiration of the policy period except upon sixty (60) days by written certified or registered mail to the Fund and to the Commissioner; and,

(c) A statement by the aggregate excess insurer that the excess insurance coverage limits and retention are not subject to any side agreements or the increases or decreases other than as set forth in the Fund's application for approval of their excess loss funding program; and,

(d) A statement that the policy does not exclude or restrict coverages due to the insolvency or bankruptcy of the Fund or any of its members.

(e) Such policy shall not contain any restrictions which would relieve the insurer of its duties and liabilities due to any administrative action taken by the Commissioner.

Ga. L. 1960, pp. 289, 305; Ga. L. 1981, pp. 1759, 1778; O.C.G.A. Secs. 33-2-9, 34-9-161, 34-9-174.

Disclaimer: These regulations may not be the most recent version. Georgia may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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