260 R.I. Code R. 260-RICR-50-05-1.7

Current through December 3, 2024

Section 260-RICR-50-05-1.7 - EXCESS COVERAGE

A. Every applicant for initial approval of workers' compensation self insurance and every applicant for renewal of its certified employer status shall purchase and maintain a specific excess insurance policy with:

1. an upper minimum coverage limit of at least $10,000,000 or higher per occurrence in excess of the self insured retention level of the policy; and

2. a self insured retention level specifically approved by the director.

B. New applicants for self insurance and certified employers during their first five years of self insurance may also be required to carry aggregate (stop loss) insurance with a carrier and limits acceptable to the director.

C. All excess policies issued to certified employers, shall:

1. include in the policy declarations, the name of the self insurer (principal); self insured retention limits; policy coverage limits; policy period; policy number; and name of issuing carrier;

2. state that the policy covers and will reimburse all workers compensation liability benefits and services paid above the retention level of the policy including all administrative, legal, claims handling, expenses related to a covered claim;

3. include an insolvency clause that requires the carrier to reimburse up to the policy limits regardless of the financial condition of the policy holder, and that in the event of an insolvency or default of the policy holder, to reimburse any surety carrier or the director that subsequently becomes responsible to run off the claims of the policy holder by order of the director of the Rhode Island Department of Labor and Training;

4. not contain an exclusion clause for acts of terrorism, domestic or foreign;

5. require at least 30 days advance written notice to the director before excess policy cancellation for any reason or any other amendment issued by the carrier to the excess policy;

6. contain a clause stating that notwithstanding any other provisions of the policy or representations made by the parties, the excess policy will conform to the laws and regulations of Rhode Island;

7. require the excess carrier to bear its responsibility for the policy obligations unless claims nonconformance by the certified employer is substantial and severely prejudices the ability of the excess carrier to mitigate its losses;

260 R.I. Code R. 260-RICR-50-05-1.7

Amended effective 11/28/2018