California – Insurance Commissioner Dave Jones today applauded a decision by the State Compensation Insurance Fund to return $50 million in policy premiums to California employers. The State Fund Board of Directors finalized this decision today. State Fund provides workers’ compensation insurance to approximately 130,000 employers in California.
The Department of Insurance expressed concerns with State Fund’s original premium return proposal, which limited the premium return or dividends to renewing policyholders. During these discussions the Department urged State Fund to re-evaluate how it was going to issue the returned premiums or dividends to its policyholders.
“I applaud the decision by State Fund to return these premiums,” said Insurance Commissioner Dave Jones. “State Fund’s Board of Directors also made the right move by revising their initial proposal, which would have denied the dividend to non-renewing policyholders.”
According to State Fund the credit would be available to 2011 policyholders who:
- Paid their premiums timely and kept their policy in good standing in 2011,
- Finalize their final audit bill for 2011 within six months of expiration.
In addition, State Fund’s Board of Directors decided to remove the renewal requirement, following recent discussions with the Department of Insurance. The total return is estimated at approximately 5.2 percent of State Fund’s 2011 estimated annual premiums. According to State Fund, this return will be applied to premiums in 2012. The most recent dividend that was declared by State Fund came in 2001 which was more than $92 million.
Source: CA DOI