New York Codes, Rules and Regulations › Title 12 - DEPARTMENT OF LABOR › Chapter V - Workers' Compensation › Subchapter B - Self-insurers › Part 317 - Group Self-insurance › Section 317.8 - Integrity of the group self-insurer's trust funds

Current through Register Vol. 46, No. 28, July 10, 2024
Every effort shall be made by the group self-insurer, its
					 trustees, its group administrator or other agent(s) to preserve the integrity,
					 strength and liquidity of the group's fund so as to permit the timely and
					 complete payment of all group claims and other liabilities. With the exception
					 of groups consisting of municipal corporations, unless otherwise authorized by
					 the chair, group self-insurers shall be subject to the following requirements
					 with respect to trust funds.
(a) The
				  group self-insurer, its trustees, its group administrator or other agent(s)
				  shall not utilize any of the trust funds collected from group members or earned
				  by the trust for any purpose not directly related to the payment of claims,
				  security deposits, assessments, penalties, reasonable costs of operation, fixed
				  costs such as excess insurance, the payment of earnings or refunds to group
				  members, or other trust obligations. The group self-insurer, its trustees, its
				  group administrator or other agent(s) shall not borrow money from the trust
				  fund or in the name of the trust and shall not permit any lending, issuance of
				  debt instruments or other forms of obligations and encumbrances, nor shall the
				  group self-insurer, its trustees, its group administrator or other agent(s)
				  extend credit to a member for the payment of contributions or assessments. This
				  restriction shall not preclude the group self-insurer from permitting fixed
				  installment plans, not to exceed one year, for the payment of members'
				  contributions or assessments.
(b)
				  The trust assets of the group self-insurer shall not be commingled with the
				  assets of any member, nor shall the funds dedicated to the payment and
				  administration of claims, assessments, and other costs arising under the
				  Workers' Compensation Law, or to employer liability costs, be commingled with
				  any other funds, such as those dedicated to pension and health
				  benefits.
(c) Subject to the
				  limitations set forth in subdivision (d) of this section, a group self-insurer,
				  its trustees, its group administrator or other agent(s) may invest any funds of
				  the trust which are not necessary for the payment of short term obligations of
				  the trust in the following:
(1) government
				  obligations: obligations which are not in default as to principal or interest,
				  which are valid and legally authorized, and which are issued or guaranteed by:
(i) the United States or by any agency or
				  instrumentality thereof;
(ii) any
				  state in the United States; or
(iii) any agency or instrumentality of any
				  state in the United States, provided that such government obligations shall be
				  by law payable, as to both principal and interest, from taxes levied or
				  adequate special revenues pledged or otherwise appropriated;