Member Assessments

The Association may assess member self-insurers in four instances:

  1. Association Aggregate Security System (“AASS”) assessments are made each year that the Commissioner of Insurance approves the an AASS to provide aggregate security for eligible member self-insurers in lieu of the posting of individual security by each member self-insurer. Please click on the Association Aggregate Security System tab to read a complete description of the current AASS.

  2. Group Assessments – The Association may annually assess each member group self-insurer in an amount not to exceed two percent (2%) of the group self-insurer’s annual gross premiums for the preceding calendar year, as determined under G.S. 105-228.5(b), (b1), and (c).

  3. Special Assessments are made in the event that the assets of the Association are not sufficient to pay covered claims against one or more insolvent member self-insurers. In the event of a Special Assessment, each member pays an assessment that is based on the proportion of the individual member self-insurer’s workers’ compensation liabilities to the aggregate total of the workers’ compensation liabilities of all member self-insurers.

  4. A newly licensed member self-insurer pays an initial assessment to the Association. The current New Member Assessment Policy follows:

RESOLUTION
(NEW MEMBER ASSESSMENT POLICY)
April 24, 2008

RESOLVED, THAT, pursuant to the Plan of Operation, the following policy governs the initial assessment of member self-insurers that licensed by the North Carolina Department of Insurance (“Department”) and become members of the North Carolina Self-Insurance Security Association (“Association”) on or after January 1, 2008

    1. Individual self-insurers that are admitted as members of the Association on or after January 1, 2008 will pay an initial assessment to the Association based on the total outstanding North Carolina workers’ compensation liabilities (“Workers’ Compensation Liabilities”) reflected on its application to the Department and its credit rating at the time of its application. Start-up companies without a prior loss history will pay an assessment based solely on their credit rating because they would not have incurred any actuarially determined outstanding liabilities.

      For all those self-insurers that have the equivalent of an A3 rating or above will be assessed as follows: Under $3 million in Workers’ Compensation Liabilities – $25,000.00; Between $3 million and $6 million in Workers’ Compensation Liabilities – $50,000.00; Between $6 million and $10 million Workers’ Compensation Liabilities – $75,000.00; and $10 million and greater in Workers’ Compensation Liabilities will be assessed $100,000.00.

      For all member self-insurers that have the equivalent of a B3 rating up to and including a Baal rating will be assessed as follows: Under $3 million in Workers’ Compensation Liabilities – $37,500.00; Between $3 million and $6 million in Workers’ Compensation Liabilities – $75,000.00; Between $6 million and $10 million in Workers’ Compensation Liabilities – $112,500.00; and $10 million and greater in Workers’ Compensation Liabilities will be assessed $150,000.00.

      For all member self-insurers that have the equivalent of a credit rating lower than B3 will be assessed as follows: Under $3 million in Workers’ Compensation Liabilities – $50,000.00; Between $3 million and $6 million in Workers’ Compensation Liabilities – $100,000.00; Between $6 million and $10 million in Workers’ Compensation Liabilities – $150,000.00; and $10 million and greater in Workers’ Compensation Liabilities will be assessed $200,000.00.

    2. Group self-insurers pay an initial new member assessment deposit of $10,000.00 that is due and payable on the date that the group self-insurer is admitted as a member of the Association. During the first partial calendar year of membership, new group self-insurer members are assessed at the rate of 1.28% of the group self-insurer’s estimated first year Premium. The estimated first year Premium is determined by pro-rating the Premium for the portion of the year that the group self-insurer is a member to produce an estimated Premium for the entire calendar year. The assessment deposit is credited against the assessment due. Any excess deposit is applied to the second year assessment. For the remainder of the first full calendar year of membership, the group member self-insurer is assessed at the rate of 1.47% of the Premium and the second year assessment is due and payable at the end of the first full calendar year of membership.

    Initial assessments are due on the effective date of the license to self-insure. The policy set forth herein is applicable only to the collection of initial assessments from new member self-insurers. In addition to the initial new member assessment, new members will pay all additional assessments made by the Association for the period the individual or group self-insurer is a member of the Association.

    Adopted by an affirmative vote of a majority of the Board of Directors of the Association on April 24, 2008.