New Mexico Administrative Code
Title 11 - LABOR AND WORKERS' COMPENSATION
Chapter 4 - WORKERS' COMPENSATION
Part 10 - SELF-INSURANCE POOLING OF PUBLIC ENTITIES
Section 11.4.10.9 - INFORMATION REQUIREMENTS

Universal Citation: 11 NM Admin Code 11.4.10.9

Current through Register Vol. 35, No. 18, September 24, 2024

A. As a condition precedent to maintenance of a certificate of pool self-insurance, each pool shall compel its administrator and any service company to provide to the director the following information and access to records:

(1) a copy of any reinsurance or excess insurance agreements;

(2) an explanation of reserving methodology and accident year claims data on an annual basis;

(3) rate change information within thirty days of approval by the board of directors of the pool;

(4) loss runs in a format acceptable to the director within 60 days of receipt by the administrator of the director's request; and

(5) an annual actuarial opinion.
(a) This opinion shall include actuarially appropriate reserves for (1) known claims and associated expenses; and (2) claims incurred but not reported and associated expenses.

(b) This actuarial opinion shall also include a rate adequacy evaluation.

(c) The actuarial opinion shall be given by a member of the American academy of actuaries.

(6) a copy of any rate adequacy evaluations and reviews of loss and loss adjustment expenses prepared for the pool by an actuary who shall be a member of the American academy of actuaries.

(7) notification to the director of any additions or deletions to the pool's membership roster; additionally, each pool shall provide within 30 days of the end of each calendar quarter a roster of members, including the number of employees employed by each member on the last day of the quarter.

B. Examination and reviews:

(1) The director or his designees may examine the affairs, transactions, accounts, records and assets and liabilities of each governmental entity that has been issued a certificate of pool self-insurance pertaining to the entity's activities under that certificate, whether considered individually or through its pool as often as deemed advisable, whether such information is maintained by a governmental entity, the pools administrator or the pool's service company.
(a) The governmental entity, pool, administrator or pool service company shall cooperate fully with the director's representatives in any evaluation or audit of the pool self-insurance program, and resolve, in good faith, issues raised in those evaluations or audits.

(b) Failure to resolve such audit issues in good faith will constitute a violation of this rule, and may result in sanctions.

(c) Any dispute concerning issues raised shall be referred by the deputy director for compliance to the director for determination, if not first informally resolved.

(2) In lieu of performing the examination, the director may request:
(a) financial audits conducted by a certified public accountant approved by the state auditor;

(b) audits of claims management by the pool performed by the pool's reinsurer or other outside claims auditing firm;

(c) loss control audits performed by the pool's reinsurer; or

(d) any other independent claims audit of a scope and by an auditing organization deemed acceptable by the director.

(3) Each governmental entity that has been issued a certificate of pool self-insurance, individually, or collectively through its pool, shall be reviewed at least annually by an auditor acceptable to the director to verify proper classifications, experience rating, payroll and rates.

C. A governmental entity that has been issued a certificate of pool self-insurance under these rules shall assist the director in any investigation of specific allegations of unfair claims processing, bad faith or fraud within the scope of NMSA 1978, Section 52-1-28.1, by directing the administrator of the pool to make all records concerning any such claim available to the director upon written request by the director or the records.

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