16 Tex. Admin. Code § 14.2034 - Self-Insurance Requirements
(a) This section
applies to a licensee's general liability insurance, including premises and
operations coverage. This section shall not apply to worker's compensation
insurance, including employer's liability coverage.
(b) A licensee applying for self-insurance
shall file LNG Form 2027 with AFS along with materials which will allow AFS to
determine whether:
(1) the net worth of the
applicant is adequate in relationship to the size of operations and the extent
of its request for self-insurance authority. The applicant shall demonstrate
that it will maintain a net worth sufficient to ensure that it will meet its
statutory obligations to the public to pay all claims relating to general
liability, including premises and operations coverage; and
(2) the applicant has a sound self-insurance
program. The applicant shall demonstrate that it has established and shall
maintain an insurance program that will protect the public against all claims
involving LNG activities to the same extent as the minimum limits specified in
Table 1 of §
14.2031 of this title (relating to
Insurance Requirements). Such a program may include but not be limited to one
or more of the following: reserves; irrevocable letter of credit, as specified
in subsection (h) of this section; sinking funds; third-party financial
guarantees; parent company or affiliate sureties; excess insurance coverage; or
other similar arrangements.
(c) AFS may consider applications for
approval of other securities or agreements, or may require any other
information which may be necessary to ensure the application satisfies that the
security or agreement offered will afford adequate security for protection of
the public.
(d) AFS may approve a
licensee's application for self-insurance if the licensee demonstrates to AFS
its ability to satisfy its obligations for the minimum insurance requirements
specified in §
14.2031 of this title. AFS may
approve the licensee as a self-insurer for a specific time period or for an
indefinite period until further action is taken by AFS.
(e) The applicant shall file semi-annual
reports and annual statements with the applicant's financial status and status
of its self-insurance program with AFS during the period of its self-insurer
status by March 10 and September 10 of each year.
(f) After ten days' notice to the applicant,
AFS may require the applicant to appear and demonstrate that it continues to
have adequate financial resources to pay all general liability, including
premises and operations coverage claims, and that it remains in compliance with
the other requirements of this section. If the applicant fails to do so, AFS
shall revoke its self-insurer status and may order that the licensee is
ineligible for self-insurance in the future.
(g) A state agency or institution, county,
municipality, school district, or other governmental subdivision may meet the
requirements for workers' compensation coverage or general liability and/or
motor vehicle liability insurance if permitted by the Texas Workers'
Compensation Act, Texas Labor Code, Title 5, Subtitle A; and Texas Natural
Resources Code, §
116.036, by
submitting LNG Form 2995 to AFS.
(h) Letters of credit filed with LNG Form
2028 shall:
(1) be issued by a federally
chartered and federally insured bank authorized to do business in the United
States;
(2) be irrevocable during
their terms;
(3) be payable to the
Commission in part or in full upon demand and receipt from the Commission of a
notice of forfeiture; and
(4) not
apply to the licensing requirements for worker's compensation insurance,
including employer's liability coverage.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.