65-04 The Fund and Premium Payments Thereto

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CHAPTER 65-04THE FUND AND PREMIUM PAYMENTS THERETO65-04-01. Classification of employments - Premium rates - Requirements.1.The organization shall classify employments with respect to their degrees of hazard, determine the risks of different classifications, and fix the rate of premium for each of the classifications sufficiently high to provide for:a.The payment of the expenses of administration of the organization;b.The payment of compensation according to the provisions and schedules contained in this title; andc.The maintenance by the fund of adequate reserves and surplus to the end that it may be kept at all times in an entirely solvent condition.2.In the exercise of the powers and discretion conferred upon it, the organization shall fix and maintain for each class of occupation, the lowest rate which still will enable it to comply with the other provisions of this section.3.The organization shall establish premium rates annually on an actuarial basis. The statewide average premium rate level may not deviate by more than five percentage points from the recommended actuarial indicated premium level for that year.4.Before the effective date of any premium rate change, including a change in the minimum premium, the organization shall hold a public hearing on the rate change. Chapter 28-32 does not apply to a hearing held by the organization under this subsection.65-04-02. Reserves - Surplus.1.The organization shall maintain adequate financial reserves to ensure the solvency of the fund and the payment of future benefit obligations, based upon actuarially sound principles. The discount rate used in evaluating the financial reserves may not exceed six percent.The level of financial reserves plus available surplusdetermined as of June thirtieth of each year must be at least one hundred twenty percent but may not exceed one hundred forty percent of the actuarially established discounted reserve.2.If the level of financial reserves plus available surplus determined as of June thirtieth of any year is below one hundred twenty percent of the actuarially established discounted reserve, the organization may not issue premium dividends and, notwithstanding section 65-04-01, the organization shall modify recommended premium rate levels so that the organization is estimated to come into compliance within the following two years.3.If the level of financial reserves plus available surplus determined as of June thirtieth of any year is above one hundred forty percent of the actuarially established discounted reserve, the organization shall issue premium dividends in a fiscally prudent manner so that the organization is estimated to come into compliance with the requirements of subsection 1 within the following two years. However, premium dividends issued may not exceed fifty percent of the preceding year's premium in any given year.4.If the level of financial reserves plus available surplus determined as of June thirtieth of any year is between one hundred twenty percent and one hundred thirty percent of the actuarially established discounted reserve, the organization may not issue premium dividends.Page No. 15.If the level of financial reserves plus available surplus determined as of June thirtieth of any year is one hundred thirty percent to one hundred forty percent of the actuarially established discounted reserve, the organization may issue premium dividends. However, premium dividends issued may not exceed forty percent of the preceding year's premium in any given year, and the level of financial reserves plus available surplus may not be reduced below one hundred thirty percent.6.For the purposes of this section, "available surplus" means net assets as stated on the statement of net assets of the organization, but does not include funds designated or obligated to specific programs or projects pursuant to a directive or specific approval by the legislative assembly.7.The independent annual financial audit of the organization must report the organization's financial reserves.65-04-03. Accounts to be kept for classifications and employers. The organizationshall keep an accurate account of the moneys paid in premiums by each of the several classes of occupations or industries and of the disbursements on account of injuries to and deaths of employees thereof, and it also shall keep an account of the moneys received from each individual employer and of the amount disbursed from the fund on account of injuries to and deaths of employees of each employer.65-04-03.1. State entities account - Continuing appropriation - Report to budgetsection.1.The organization shall establish a single workforce safety and insurance account for state entities covered by chapter 32-12.2. The organization shall use the combined payroll, premium, and loss history of selected agencies to determine future experience rates, dividends, assessments, and premiums.Classifications andpremium rates must be based on the hazards and risks of the different occupations covered by this account. The payroll reporting period for this account is for a fiscal year of July first through June thirtieth. The office of management and budget shall furnish combined payroll information to the organization in a format prescribed by the organization.2.Workforce safety and insurance premiums from state entities covered by chapter 32-12.2 must be deposited in the risk management workers' compensation fund. The state investment board shall invest this fund in accordance with chapter 21-10. Funds received as contributions from state entities, all other payments deposited in this fund, and interest and income received on investments are appropriated on a continuing basis for the purposes of this fund. The purposes of this fund are to pay workforce safety and insurance premiums for state agencies, workforce safety and insurance claims costs not covered by the deductible contract, and costs associated with workers' compensation loss control programs. The risk management division of the office of management and budget shall administer this fund. Section 54-44.1-11 does not apply to this fund.3.A state entity covered by chapter 32-12.2 shall participate in the risk management workforce safety and insurance program unless exempted by the director of the office of management and budget.4.The risk management division of the office of management and budget shall administer the account's internal workforce safety and insurance return-to-work program. Every state entity is required to participate in the return-to-work program. The program may include assigning employees to agencies other than the agency for which the employee worked on the date of the injury.5.The office of management and budget may adopt rules to administer the risk management workforce safety and insurance program. The organization and thePage No. 2risk management division of the office of management and budget periodically shall report to the budget section of the legislative management on the success of this program.65-04-04. Employers obligated to pay premiums - Premium and certificates to bemailed.Each employer subject to this title shall pay into the fund annually the amount ofpremiums determined and fixed by the organization for the employment or occupation of the employer. The amount must be determined by the classifications, rules, and rates made and published by the organization and must be based on a proportion of the annual expenditure of money by the employer for the service of persons subject to the provisions of this title. The organization shall mail to the employer a certificate specifying that the payment has been made. The certificate, attested by the seal of the organization, is prima facie evidence of the payment of the premium. Notwithstanding the provisions of section 65-04-15, the certificate may reflect the employer has paid the minimum premium and has no employees for the period indicated on the certificate. If an employer defaults on premium payments after a certificate has been issued, the organization may revoke that employer's certificate.The organization shall provide thatpremiums to be paid by school districts, multidistrict special education units, area career and technology centers, and regional education associations, townships, and all public corporations or agencies, except municipal corporations, fall due at the end of the fiscal year of that entity, and that premiums to be paid by all municipal corporations fall due at the end of the calendar year, and may make provisions so that premiums of other employers fall due on different or specified dates. For the purpose of effectuating different or specified due dates, the organization may carry new or current risks for a period of less than one year and not to exceed eighteen months, either by request of the employer or action of the organization. An employer subject to this chapter shall display in a conspicuous manner at the workplace and in a sufficient number of places to reasonably inform employees of the fact, a certificate of premium payment showing compliance with this chapter and the toll-free telephone number used to report unsafe working conditions and actual or suspected workforce safety and insurance fraud. Any employer subject to this chapter is liable to pay a civil penalty of two hundred fifty dollars for failure to display the notice of compliance and the toll-free telephone number as required by this section.65-04-04.1.Determinationofweeklywageforpremiumpurposestoveteran-on-the-job trainee. 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65-04 The Fund and Premium Payments Thereto