South Dakota § 58-20-28 - Requirements to obtain self-insurance certificate.

§ 58-20-28. Requirements to obtain self-insurance certificate.

To obtain and maintain its certificate an association shall:

(1)    Have sufficient assets, net worth, and liquidity to promptly meet all obligations of the association's members under §§ 58-20-25 to 58-20-40, inclusive, and their workers' compensation liability. In determining whether an association is in sound financial condition, consideration shall be given to the combined net worth of the member companies; the combined long-term and short-term debt to equity ratios of the member companies; other financial data requested by the department or submitted by the group; and the combined workers' compensation experience of the group for the last three years;

(2)    Furnish to the department security in the form of a bond, cash, certificate of deposit, government securities, irrevocable letter of credit, irrevocable trust, in any combination, in an amount equal to the greater of:

(a)    Two hundred fifty thousand dollars; or

(b)    Twenty-five percent of the association's preceding year's gross annual assessments to its members;

(3)    Obtain specific and aggregate excess insurance by an insurance company licensed to conduct business in South Dakota; and

(4)    Maintain an indemnity agreement jointly and severally binding the association and each member of the association to meet the workers' compensation liability of each member.

Source: SL 1995, ch 282, § 4.