S.C. Code Regs. 67-1507 - Proof of Compliance, Irrevocable Letter of Credit
A. The Commission in its discretion may accept a Form 8B, Proof of Compliance, Memorandum of Understanding and Irrevocable Letter of Credit, as proof of compliance instead of a surety bond or securities. The Commission will determine the amount as provided by R.67-1505A.
B. The applicant for self-insurance shall file the Form 8B with the Commission's Self-Insurance Division within the time provided in R.67-1502B.
C. The following provisions shall apply to a letter of credit.
(1) The letter of credit must be issued by a bank chartered in this State or a federally chartered bank with a branch office in this State.
(2) The bank shall offer the irrevocable letter of credit by completing a Form 8B.
(3) The South Carolina Workers' Compensation Commission shall be the named beneficiary.
(4) A proposed letter of credit must be approved by the Commission before the Commission issues a Form 9, Certificate for Self-Insurance.
D. Once an irrevocable letter of credit is established, it may be revoked only with the consent of the Commission.
(1) The Self-Insurance Division may grant consent only when the self-insurer offers proof of the purchase of a surety bond, pledges securities or obtains another irrevocable letter of credit.
(2) Expiration or cancellation of a letter of credit is effective only after sixty days written notice filed with the Self-Insurance Division.
(3) The self-insurer shall file notice of the replacement to the Self-Insurance Division in writing by certified mail.
(4) When the self-insurer fails to replace the letter of credit with another accepted proof of compliance, the Commission may demand payment of the letter of credit and deposit the proceeds in the South Carolina State Treasurer's Office to guarantee payment of any claim occurring during the self-insured period.
(5) The Commission may exercise the letter of credit at any time if the proceeds are needed for payment of a claim that occurred during the self-insured period.
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