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The Department's Worker's Compensation Division (Division) is responsible for administering Chapter 102, Wisconsin Statutes, of which provisions for self-insurance are a part. Staff within the Division coordinate and monitor Wisconsin's self-insurance program.
In addition to the minimum requirements for the initial application or renewal of self-insurance status, the Department also evaluates other factors which are needed to determine the amount of securities, and the number and kind of reports to be submitted to assure the prompt and full payment of all worker's compensation liabilities. These additional factors include:
When the Department receives an application for exemption, it is first checked by Division staff for general accuracy, completion and ability of the employer to meet the minimum requirements and criteria for exemption. (The application constitutes a request for hearing before the self-insurers council, providing the Division staff determines the employer meets the minimum requirements and criteria for exemption.)
If portions of the application are incomplete or found to be in error, it is returned to the employer for correction or clarification before any determination on qualificationis made.
Everything accompanying the application becomes the property of the Division. The application fee is not refundable. If the employer's application is rejected, the Division will properly dispose of the material.
If the employer does not meet the basic minimum standards or requirements for exemption, the application is denied, and the employer so notified, at this first step in the application process.
When the data submitted appears to show that an employer may qualify for self-insurance, a hearing is scheduled among representatives of the applying employer, administrative staff of the Division, and the Self-Insurers Council. Wisconsin Statutes provide for the Self-Insurers Council to advise the Department on self-insurance matters. The council members are appointed on a three-year basis, by the secretary of the Department, and are representatives of employers which are currently self-insured in Wisconsin.
The hearing is a meeting between representatives of the employer, the Division, and the Self-Insurers Council in an informal discussion covering the subjects of the applying employer's method of claims handling, safety and health practices, medical services, rehabilitation of injured or ill employees, and the financial status of the company. The purpose of the hearing is to resolve any questions the applying employer may have on the responsibilities involved in being self-insured, to offer the employer suggestions in operating a successful self-insurance program by persons already experienced as self-insurers, and to enable the Council an opportunity to resolve any questions they may have and form their recommendation to the Division and the Department on the approval or denial of the employer's application.
After this hearing, the Self-insurers council will make its recommendation on the approval or denial of the application to the Division. If the Self-Insurers Council recommends denial of an exemption from the duty to insure and the Division concurs with that decision; the applicant may appeal that finding to the secretary of the Department. The decision of the Secretary is final.
If the Self-Insurers Council recommends approval of the application, it may recommend security requirements also. If the Division concurs, an order is written which states the specific conditions with which the employer must comply (e.g., bond and excess insurance requirements).
The average length of time to process an employer's self-insurance application from receipt of an accurate and complete application to approval or denial is three months.
The Act provides that each year the Department shall assess upon and collect from each worker's compensation insurance company and self-insured employer, the proportion of total costs and expenses incurred by the Department for administering the Act for the current fiscal year plus any deficiencies in collections and anticipated costs from the previous fiscal year. The assessment is determined from cases initially closed by the Division during the preceding calendar year and is based on the ratio of total indemnity paid or payable by each carrier and self-insured employer, other than for increased, double or treble compensation. In addition, each self-insured employer shall also be assessed a pro rata portion of the Department's cost of administering the Self-Insurance program, calculated in the same manner as the general assessment above, plus $200.
Additionally, s. 102.28(7) of the Act calls for a special assessment of all self-insurers if a current or former self-insurer can't make its worker's compensation payments. This is an important consideration for employers contemplating the filing of an application. All current self-insured employers, including new approved applicants, are, and will continue to be, assessed annually as this condition does exists.
Under s. 102.59(2), self-insurers and insurance companies must also make payments into a "work injury supplemental benefit fund" for the loss or total impairment of a hand, arm, foot, leg, eye or death, resulting from an occupational injury or illness.