Alabama § 25-5-332 - Premium Discount Where Drug-Free Workplace Program Implemented.

§ 25-5-332. Premium Discount Where Drug-Free Workplace Program Implemented.

(a) If an employer implements a drug-free workplace program substantially in accordance with this article, the employer shall qualify for certification for a five percent premium discount under the employer’s workers’ compensation insurance policy.

(b) For each policy of workers’ compensation insurance issued or renewed in the state on and after July 1, 1996, there shall be granted by the insurer a five percent reduction in the premium for the policy if the insured has been certified by the Department of Labor, Workers’ Compensation Division, as having a drug-free workplace program which complies with the requirements of this article and has notified its insurer in writing of the certification.

(c)(1) The premium discount provided by this section shall be applied to an insured’s policy of workers’ compensation insurance pro rata as of the date the insured receives certification by the Department of Labor, Workers’ Compensation Division, and shall continue for a period not to exceed four years. Notwithstanding the foregoing, an insurer shall not be required to credit the actual amount of the premium discount to the account of the insured until the final premium audit under the policy. Certification of an insured shall be required for each of the four years in which the premium discount is granted. Thereafter, any premium discount pursuant to this article shall be determined from the experience rating plan of the insured, or in the case of an insured not rated upon experience, as provided in subdivision (2).

(2) With respect to an insured which is not rated upon experience, any premium discount given an insured pursuant to this article after the initial four-year period provided in subdivision (1) shall be determined by the State Insurance Commissioner based upon data received from the rating and statistical organization designated by the commissioner pursuant to this article.

(d) The workers’ compensation insurance policy of an insured shall be subject to an additional premium for the purposes of reimbursement of a previously granted premium discount and to cancellation in accordance with the policy if it is determined by the Department of Labor, Workers’ Compensation Division, that the insured misrepresented the compliance of its drug-free workplace program.

(e) Each insurer shall make an annual report to the rating and statistical organization designated by the state Insurance Commissioner pursuant to this article illustrating the total dollar amount of drug-free workplace premium credit. Standard earned premium figures reported pursuant to this subsection on the aggregate calls for experience shall reflect the effects of the credits. The net standard premium shall then be the basis of any premium adjustment. The drug-free workplace credits shall be reported under a unique classification code or unit statistical reports submitted to the rating and statistical organization designated by the state Insurance Commissioner.

(f) The state Insurance Commissioner may promulgate rules and regulations necessary for the implementation and enforcement of this article.