Florida Administrative Code › 69 - DEPARTMENT OF FINANCIAL SERVICES › 69O - OIR - Insurance Regulation › Chapter 69O-190 - RULES FOR SELF-INSURERS UNDER THE WORKERS' COMPENSATION ACT › Section 69O-190.068 - Indemnity Agreement

Current through Reg. 50, No. 138; July 16, 2024
(1) Each
				self-insurers fund member shall enter into an indemnity agreement jointly and
				severally binding the self-insurers fund and each member thereof to comply with
				the provisions of the Florida Workers' Compensation Law and rules of the
				Office. Employers in the public sector who are legally unable to enter into a
				joint and several liability indemnity agreement with private employers shall be
				ineligible to participate in a self-insurers fund with members who are private
				employers. Self-insurers funds composed entirely of public employers may be
				authorized and must qualify in the same manner and be subject to the same
				regulations as all other self-insurers funds.
(2) The indemnity agreement required pursuant
				to paragraph 69O-190.056(3)(a),
				F.A.C., shall conform to the form of the indemnity agreement hereinafter set
				forth and shall contain all its provisions but may also contain other
				provisions not inconsistent with these rules or with the required provisions.
				"Administrator" or "Fiscal Agent" may be substituted as may be necessary to
				reflect the respective authority, responsibility and duties of these agents,
				consistent with these rules.
INDEMNITY AGREEMENT
THIS INDENTURE, made and entered into this ___ day of ___, A.
				  D., 20___, by and between all the parties who are now or may hereafter become
				  members of the ___ Self-Insurers Fund, acting by and through a Board of
				  Trustees of their own selection.
WITNESSETH
WHEREAS, the undersigned persons, firms and corporations,
				  hereinafter referred to as "Members," have applied to the Office of Insurance
				  Regulation, hereinafter referred to as the "Office," for authority to pool our
				  liabilities pursuant to the terms of the Florida Workers' Compensation Law and
				  specifically as provided by Section
				  624.4621, F.S., and
WHEREAS, the said members have organized and formed a fund
				  pursuant to said section, which fund shall be known as ___ Self-Insurers Fund,
				  herein referred to as the "Fund," and
WHEREAS, the members of said Fund have designated ___ as its
				  first Board of Trustees to direct the affairs of said Fund and to pass on the
				  admissability of future members of the Fund until the members select succeeding
				  Trustees for said Fund, and
WHEREAS, the said Trustees have designated ___ as Service
				  Agent for said Fund, and
WHEREAS, the Office, upon petition of the group, has made its
				  order approving said application, but upon the following conditions,
				  to-wit:
I
The group shall, before being issued a certificate, post
				  either a corporate surety bond or securities acceptable to the Office in the
				  aggregate sum of ___ dollars ($) to secure performance of any awards which
				  might be made against the Fund or any member thereof, and keep said bond or
				  securities posted as long as may be required by the Office. The Trustees shall
				  from time to time be entitled to receive all interest accruing on any
				  negotiable securities posted, provided that the Fund is not in default in
				  payment of compensation benefits or of any assessment levied by the Office in
				  accordance with Sections
				  440.20(9),
				  440.49 and
				  440.51, F.S.
II
That the members of said Fund execute a covenant or agreement
				  whereby in addition to the collateral just above mentioned, the Fund and its
				  members will jointly and severally covenant to assume and discharge, by
				  payment, any lawful awards entered by the Office against any member of the
				  group, which awards shall have been sustained by the courts where an appeal by
				  either party is taken.
III
That the members of the Fund execute a covenant or agreement
				  whereby the Fund and each member thereof will jointly and severally covenant
				  and agree to pay premiums and assessments, based upon appropriate
				  classifications and rates, into a designated cash reserve fund out of which
				  lawful and proper claims and awards are to be paid, and further, that the group
				  will jointly and severally covenant and agree there will be no disbursements
				  out of this fund by way of dividends or distribution of accumulated reserves to
				  the respective members, except at the direction of the Trustees after
				  application to and approval by the Office.
AND WHEREAS, the members of said fund, through their
				  designated Trustees, have elected to comply with said conditions and become
				  self-insurers, and to execute the other covenants required;
NOW, THEREFORE, for and in consideration of the mutual
				  covenants, promises and obligations herein contained, which are given to and
				  accepted by each member hereof to the other, the parties to this instrument
				  covenant, stipulate and agree as follows:
1. The Fund hereby agrees either to file with
				the Office a corporate surety bond in the principal sum of ___ dollars ($) or
				to deposit ___ dollars ($) in acceptable securities with the Office to secure
				performance by the Fund of payment of all lawful awards made by the Office
				against any member or members of the group, predicated on a claim or claims by
				an employee or employees of any member of the Fund arising out of and in the
				course of such claimant's employment, and which awards shall have been
				sustained by the courts where an appeal by either party is taken; and upon
				condition that said member through which such claim originated shall not have
				been suspended from, resigned from, or expelled from the Fund after thirty (30)
				days' notice to the Office of such suspension, resignation, or expulsion, and
				which notice to the Office shall have been given thirty (30) days prior to the
				accident complained of.
2. The
				members of this Fund do jointly and severally covenant and agree that they will
				pay any such award as would otherwise be a claim against the aforesaid surety
				bond or securities as soon as the same shall become payable under the laws of
				the State of Florida; and the group agrees to pay to the Office for the
				administration of the law such assessments as may be ordered by said Office in
				accordance with Sections
				440.20(9),
				440.49 and
				440.51, F.S.
3. The members intend this agreement as a
				mutual covenant of assumption and not as a partnership, but should any court of
				competent jurisdiction construe same to be a partnership, then it is the
				intention of the parties that such partnership be limited in scope to the uses
				for which this contract is executed and no other.
4. That, subject to the approval of the
				Office, the Trustees of the Fund shall set up, operate, and enforce its own
				administrative rules, regulations and by-laws as between the individual members
				of the Fund.
5. The members ratify
				and confirm appointment by the Trustees of ___ as Service Agent for the Fund
				and its members, individually and collectively. The Service Agent shall
				determine all sums due the Fund from the members, pay all approved items of
				expense as directed by the Trustees, and give a monthly account of all monies
				so handled. For handling the administrative and servicing functions of the
				Fund, the Service Agent shall receive a fee which shall be negotiated from time
				to time by the Trustees. This fee shall be in consideration of all services and
				expenses contracted for with the Fund, which services or expenses may include
				the collecting, disbursing, and accounting for monies collected, counseling
				with members as to safety hazards, claims handling and investigation, and
				providing for excess insurance coverage. The Service Agent's books and records
				are to be open to inspection by the Office and by the Trustees or their agents
				at all reasonable times.
6. The
				Service Agent shall deposit to the account of the Trustees, at any bank or
				banks designated by the Trustees, all premiums as and when collected, and said
				monies shall be disbursed only as provided by (1) the rules, regulations and
				by-laws of the Trustees, (2) the Agreement between the Trustees and the Service
				Agent, and (3) the Rules of the Commission pertaining to self-insurers
				funds.
7. The Trustees are
				authorized and directed to take all reasonable precaution to protect the
				members from losses and shall provide for excess insurance coverage designed to
				protect said members against excess losses. The contracts for coverage shall be
				governed by the Rules of the Commission pertaining to self-insurers.
8. All members of the Fund hereby agree that
				the Trustees may admit as members of this Fund only acceptable and financially
				sound employers in the State of Florida who have common interest as defined in
				the Rules of the Commission pertaining to self-insurers, and that, subject to
				the approval of the Office, the Trustees shall be sole judge of whether or not
				any applying business shall be admitted to membership; and further, that a
				member may be suspended or expelled from the Fund after thirty (30) days'
				notice has been given to him and the Office, and that no liability shall accrue
				to the Fund or its members for any accident to an employee of the suspended or
				expelled member occurring after thirty (30) days' notice has been given to him
				and the Office as above provided.
9. The rules and regulations for the
				administering of the Fund and the admission and expulsion or suspension of
				members shall be promulgated by the Trustees. However, each member of the Fund
				agrees to abide by the following rules and regulations:
(a) The member agrees to follow the safety
				recommendations of the Trustees and the Service Agent in order to give his
				employees the maximum in safe and sanitary working conditions, and to follow
				the general recommendations of the Fund in this field to promote the general
				welfare of his employees.
(b) In
				the event of an accident or a reported claim, to make immediate provision for
				remedial care for his employees, and to give immediate notification of said
				accident to the Service Agent on the prescribed forms.
(c) The members shall make prompt payment of
				all premiums and assessments as required by the Trustees, said premiums to be
				determined by applying applicable experience modification to the standard rates
				for the exposure to risk, said standard rates to be as compiled by the National
				Council on Compensation Insurance and approved by the Office of Insurance
				Regulation. Further, said premium shall include loss and expense constants and
				minimum premiums, where applicable. Finally, said premium may be reduced by any
				discount allowed by the Trustees as long as such discount does not exceed the
				amount permitted by the Rules of the Commission pertaining to
				self-insurers.
(d) The member
				hereby appoints the Service Agent of this Fund as his agent and
				attorney-in-fact to act in his behalf and to execute all contracts and reports,
				waivers, agreements, excess insurance contracts, and service contracts; to make
				or arrange for payment of claims, medical expenses, and all other things
				required or necessary insofar as they affect his workers' compensation and/or
				employer's liability under Florida law and as covered by the terms of this Fund
				Agreement and the rules and regulations as now provided or as hereafter
				promulgated by the Trustees and the Office.
(e) The member agrees that in the event of
				the payment of any loss by the Fund under this contract, the Fund shall be
				subrogated to the extent of such payment to all the rights of the member
				against any person or other entity legally responsible for damages for said
				loss, and in such event the member hereby agrees to render all reasonable
				assistance, other than pecuniary, to effect recovery.
(f) The Fund is to defend in the name of and
				on behalf of the member any suits or other proceedings which may at any time be
				instituted against him on account of injuries or death within the purview of
				the Florida Workers' Compensation Law or on the basis of employer's liability,
				including suits or other proceedings alleging such injuries and demanding
				damages or compensation therefor, although such suits, other proceedings,
				allegations or demands are wholly groundless, false, or fraudulent, and to pay
				all costs taxed against this member in any legal proceeding defended by the
				company, all interest accruing after entry of judgment and all expenses
				incurred for investigation, negotiation or defense.
(g) Liability of the Fund to the employees of
				any employer is specifically limited to such obligations as are imposed by
				Florida law against the employer for workers' compensation and/or employer's
				liability.
(h) The Trustees of the
				Fund, the Service Agent, and any of their agents, servants, employees or
				attorneys shall be permitted at all reasonable times to inspect the work
				places, plants, works, machinery and appliances covered by this agreement, and
				shall be permitted at all reasonable times and within two years after the final
				termination of the membership to examine members' books, vouchers, contracts,
				documents, and records of any and every kind which show or tend to show or
				verify the premium which is payable under the terms hereof.
(i) The coverage of the Fund does not apply
				to punitive or exemplary damages on account of such injuries to any employee or
				employer in violation of law.
(j)
				Coverage by the Fund under the terms of this agreement shall expire and be
				cancelled automatically for nonpayment of premium, and a member may be expelled
				and dropped from the Fund upon thirty (30) days written notice by the Trustees
				or the Service Agent of the Fund to the member stating when, no less than
				thirty (30) days thereafter, cancellation shall be effective.
(k) The Fund shall not be liable for any
				additional compensation imposed by Section
				440.54, F.S.
10. The Trustees are authorized to set aside
				from the premiums collected a reasonable sum for the operating expenses or
				administrative expenses of the Fund. All remaining funds coming into their
				hands during any one fiscal year of the Fund shall be set aside and shall be
				used only for the following purposes:
(a) Fee
				for the Service Agent for said Fund as provided in paragraph 5.,
				supra.
(b) Payments for medical,
				surgical, hospital and nursing expense, and payments of compensation to
				employees covered by this contract, including settlements, awards, judgments,
				legal fees, and costs in all contest cases.
(c) Payment of Administrative, Special
				Disability Fund, and other assessments as required by the Office.
(d) Payment of cost of all bonds and auditing
				expenses required of the Fund or its agents or employees by the
				Office.
(e) Distribution to members
				in such manner as the Trustees shall deem to be equitable of any excess monies
				remaining after payment of claims and claims expenses and after provision has
				been made for open claims and outstanding reserves; provided, however, that no
				such distributions shall be made prior to the approval of the Office, and after
				complying with the applicable law and rules; provided, further, that
				undistributed excess funds from previous Fund Years may be distributed at any
				time if not required for reserves and if approved for distribution by the
				Office.
11. The Fund
				shall operate on a fiscal year from 12:01 a.m. ___ first to midnight of the
				last day in ___ of the succeeding year. Application for continuing membership,
				when approved in writing by the Trustees or their designee, shall constitute a
				continuing contract for each succeeding fiscal period unless cancelled by the
				Office or the fund, or unless the member shall have resigned or withdrawn from
				said Fund by written notice.
12.
				The members jointly and severally covenant and agree that there will be no
				disbursement out of this Fund by way of dividends or distribution of
				accumulated reserve to members until after provision has been made for all
				obligations under the Workers' Compensation Law against said Fund and except at
				the discretion of the Trustees, upon application to and approval by the
				Division.
13. Any member who
				formally applies for membership in this Fund and is accepted by the Trustees
				shall thereupon become a party to this agreement and be bound by all of the
				terms and conditions hereof, and said approved application shall constitute a
				counterpart of this agreement.
IN WITNESS WHEREOF, the members of ___ Self-Insurers Fund
				  have caused these presents to be signed by their duly authorized Chairman of
				  the Board of Trustees and have had this agreement attested by its duly
				  authorized secretary.
___ Self-Insurers Fund
By ________________________________
CHAIRMAN
ATTEST:
___________________________________
Secretary of Board of Trustees
Signed, sealed and delivered in the presence of:
____________________________________
____________________________________
We, the undersigned ___ do hereunto set our hands and seals
				  to certify our acceptance of our duties as Service Agent for ___ Self-Insurers
				  Fund this ___ day of ___ A.D., 20___.
By ___________________
Attest _________________
Its Secretary
Signed, sealed and delivered in the presence of:
________________________________________
________________________________________