The Office of Self Insurance Plans has posted an information sheet about their new regulations requiring private self-insureds to file an actuarial study each year. A link to the complete text of the approved regulations is shown below.
The new Regulations require that an annual actuarial report be prepared. The completed actuarial study must be filed by May 1, 2013 (April 15, 2013 for self-insured groups). The qualifications of the actuary are listed in the regulations and on the information sheet. According to the regulations the minimum required security deposit shall be equal to the self insurer’s losses at the undiscounted ‘expected level’ also commonly referred to as the undiscounted ‘actuarial central estimate’, including IBNR, ALAE and ULAE, net of excess coverage.
While the actuarial study will be relied upon to make collateral and security deposit decisions, you will still be required to file the Annual Report. New instructions for filing on line were also recently posted on their web site.
Pursuant to Labor Code Section 3701, the security deposit requirement of each individual private self insured employer shall be reviewed by the Chief at least annually following receipt of the private Self-Insurer’s Annual Report. The self-insurer shall post any increases or decreases indicated in the annual actuarial study and summary report or as determined by the Chief. The deposit posting is due no later than 30 days from the date the written notice of security deposit demand is made.
We recommend that you arrange for an actuarial study soon. The process could take several months to complete and we suggest that you start early. The study should be valued as of 12/31/12. We suggest that you provide the attached regulations to your actuary to ensure that they are qualified and that they provide a complete report as required by OSIP.
If you have any questions or need any assistance identifying an actuary, please do not hesitate to contact us.