Current through Register Vol. 54, No. 44, November 2, 2024
(a)
The Department will consider a certificate of insurance from an insurer or
surety to be evidence of financial responsibility if the insurer or surety is
licensed to do business under section 1605 of the Insurance Company Law of 1921
(40
P. S. §
991.1605), or otherwise
permitted by Federal law or the Insurance Department to do business in this
Commonwealth, if the following conditions are met:
(1) The certificate of insurance includes the
name of the insurance company, policy number, insurance amount, type of
coverage afforded and exclusions relating to damage arising from the use of
pesticides and expiration date of the policy.
(2) The minimum comprehensive general
liability insurance provided is $100,000 for each occurrence of bodily injury
liability and $100,000 for each occurrence of property damage liability. A
policy may be written with combined limits if the limits equal or exceed the
sum of the individual limits.
(3)
The certificate indicates coverage for completed operations and includes a
statement indicating that the coverage applies to pesticide
application.
(4) The maximum
deductible amount does not exceed $2,500 of the combined policy limits. If a
pesticide application business has not satisfied the deductible amount in a
prior claim, the policy may not contain a deductible amount.
(5) A current certificate of insurance is
forwarded to the Department at each insurance renewal date which sets forth the
same information specified in paragraphs (1)-(4).
(b) A pesticide application business desiring
to qualify as a self-insurer may submit a written proposal of self-insurance to
the Department for approval.
(1) The proposal
shall include the following:
(i) A master
self-insurance and security agreement.
(ii) A balance sheet and income statement
which shall reflect the actual financial condition of the business as of the
last complete calendar or fiscal year preceding the date of the proposal. These
documents shall be prepared in accordance with generally accepted accounting
principles and shall be certified by a certified public accountant.
(2) A business will not be
approved as a self-insurer unless it posts certain collateral with the
Department. This paragraph does not apply to government agencies or
authorities.
(3) The minimum
required security that shall be furnished to the Department is
$500,000.
(4) Only the following
will be accepted as valid collateral for self-insurance purposes:
(i) United States currency, including United
States Treasury bills, United States Treasury notes or other negotiable
obligations of the United State Government. United States Savings Bonds are not
negotiable.
(ii) Evidence of escrow
deposits in Federal or State banks, credit unions or savings and loan
associations if Federally insured. Escrow deposits shall be established for the
sole purpose of providing security to meet the duties of a
self-insurer.
(iii) Irrevocable
letters of credit issued by a bank in this Commonwealth or another bank as
approved by the Department.
(iv)
Surety bonds issued by insurers authorized or eligible to do business in this
Commonwealth.
(v) Bonds or other
negotiable obligations issued by a state, subdivision or instrumentality of a
state in the United States, if not in default as to principal or
interest.
(vi) Corporate bonds,
issued by an entity other than the proposed self-insurer, rated A or better by
Moody's Bond Record, Moody's Investors Service, Inc.
(vii) Other security approved upon petition
to the Department.
(5)
The Department will hold the collateral furnished for the benefit of the
persons to whom the self-insurer is obligated.
(i) The self-insurer shall pay for
obligations incurred under the act by assets readily reduced to liquid assets,
such as demand deposits, time deposits, negotiable instruments and other assets
which may be readily reduced to liquid form.
(ii) If the self-insurer is not able to
discharge its obligations, the self-insurer may petition the Department to
release the collateral posted as is necessary to satisfy the obligations of the
self-insurer.
(iii) If withdrawals
from collateral are required, the self-insurer shall replace the security
within 72 hours from the date of withdrawal, to retain its certificate as a
self-insurer.
(6) A
self-insurer shall annually furnish to the Department a report of claims
incurred during the preceding calendar year.
(7) Upon approval by the Department of a
self-insurance proposal, a self-insurance certificate will be issued to the
self-insurer. The certificate shall be renewed annually, after review that the
Department deems appropriate.
(c) If the evidence of financial
responsibility furnished by a pesticide application business no longer complies
with this section, the business shall immediately provide other evidence of
financial responsibility which complies with this section. If it fails to do
so, the Secretary may revoke its license.
The provisions of this §128.34 amended under section
7(b)(2) of the Pennsylvania Pesticide Control Act of 1973 (3 P. S. §
111.27(b)(2)).
This section cited in 7 Pa. Code §
130d.26 (relating to financial
responsibility).
