Section 2505 - Policyholder Dividend Statements(a) Whenever a dividend is paid on a workers' compensation policy, a written form captioned "Policyholder Dividend Statement" shall accompany the dividend paid or, where no dividend is paid, shall be provided in place of a dividend. (1) The Policyholder Dividend Statement shall identify the policyholder and the insurer, the policy to which the statement applies, and the term of said policy.(2) The Policyholder Dividend Statement shall present the calculation of the dividend result, and shall provide the policyholder with all essential data provided to compute the dividend result.(3) When no dividend is paid, the Policyholder Dividend Statement shall state the reason or reasons for non-issuance of a dividend for that participating policy.(b) In presentation of the calculation of any dividend result based on the individual policyholder's loss experience, the Policyholder Dividend Statement shall show such calculation in columnar form in both actual dollars and percentage of earned premium, and shall present such figures and percentages for the earned premiums, the incurred losses, the Incurred But Not Reported losses (IBNR), if any, the Loss Development Factor (LDF), if any, the insurer retention, if any, and any other factors pertinent to the actual dividend result. Within the context of this paragraph, the IBNR losses and the LDF are deemed pertinent factors sufficient to warrant separate identification and disclosure, if applicable.(c) A Policyholder Dividend Statement prepared in compliance with these sections shall be delivered to the organization or association or the administrator thereof in the event that the insurer will issue a workers' compensation policy insuring an organization or association of employers as a group in compliance with Section 11656.6 of the Insurance Code.(d) If a policy of insurance is issued, continued or renewed and a Policyholder Dividend Statement is issued in connection therewith by the insurer, a copy of such dividend statement shall be retained by the insurer with a copy of the policy, and shall be available for audit by the Insurance Department. Where the Policyholder Dividend Statement is provided to the policyholder through an agent, broker or solicitor, such agent, broker or solicitor shall also retain a copy of the Policyholder Dividend Statement with a copy of the policy.(e) Nothing in these regulations prohibits an insurer from issuing dividend statements or payments electronically.Cal. Code Regs. Tit. 10, § 2505
1. Amendment filed 4-2-85; effective upon filing pursuant to Government Code Section 11346.2(d) (Register 85, No. 14).
2. Change without regulatory effect designating paragraphs following subsection (b) as subsections (b)(1)-(2) and (c), amending newly designated subsection (c), relettering subsections and amending NOTE filed 1-8-2015 pursuant to section 100, title 1, California Code of Regulations (Register 2015, No. 2).
3. Amendment of section heading, section and NOTE filed 5-31-2016; operative 7-1-2016 (Register 2016, No. 23). Note: Authority cited: Sections 790.10 and 1727, Insurance Code. Reference: Sections 780, 790.02, 11656.6, 11739 and 11752.6, Insurance Code.
1. Amendment filed 4-2-85; effective upon filing pursuant to Government Code Section 11346.2(d) (Register 85, No. 14).
2. Change without regulatory effect designating paragraphs following subsection (b) as subsections (b)(1)-(2) and (c), amending newly designated subsection (c), relettering subsections and amending Note filed 1-8-2015 pursuant to section 100, title 1, California Code of Regulations (Register 2015, No. 2).
3. Amendment of section heading, section and Note filed 5-31-2016; operative 7/1/2016 (Register 2016, No. 23).