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Virginia Administrative Code (Last Updated: January 10, 2017) |
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Title 16. Labor and Employment |
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Agency 30. Virginia Workers' Compensation Commission |
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Chapter 80. Regulations Governing Individual Self-Insurance under the Virginia Workers'compensation Act |
Section 60. Surety bonds
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A. All approved self-insurers, except those employers who already have securities on deposit, shall submit to the commission a corporate surety bond, issued by a licensed Virginia bond writer.
B. The bond may not be written by any captive or subsidiary of the self-insurer, or by any captive or subsidiary of the self-insurer's parent company.
C. The bond shall be issued on the currently approved version of the commission's bond form (VWC Form No. 21A).
D. The bond must include the phrase "and its subsidiaries" immediately after the corporate name under which self-insurance was approved.
E. If the applicant has any subsidiaries that are not to be included under the bond, a specific rider to that effect must be submitted.
F. The minimum amount of the bond shall be the larger of the following:
1. $750,000, or
2. 2.0 times the annual incurred costs (including all reserves) for workers' compensation claims, based on the average of costs incurred over the past three years.
G. The commission shall increase the bond to reflect:
1. Questionable incurred cost figures or unusual reserving practices by the applicant,
2. Any change in the size or nature of operations that may affect the validity of existing claims statistics, or
3. Any aspect of the employment which suggests increased, unpredictable, incalculable, or catastrophic workers' compensation exposure in the future.
Historical Notes
Derived from VR405-20-01 § 6, eff. January 13, 1993.