28-4011

28-4011. Bonds; motor carriers; amount;
failure of security

A. A self-insurer or partial self-insurer shall file a bond with the director on a
form approved by the director with a surety company authorized by the corporation
commission to transact business in this state as surety on the bond. The self-insurer or
partial self-insurer shall be the principal obligor and this state shall be the obligee
on the bond. The bond shall be conditioned on the compliance by the self-insurer or
partial self-insurer with laws governing motor carriers.

B. The director shall fix the total amount of the bond required of a self-insurer
or partial self-insurer and may increase or reduce the amount at any time, subject to the
limitations provided in this section. The bond required of a self-insurer or partial
self-insurer shall be at least two hundred fifty thousand dollars.

C. A self-insurer or partial self-insurer may request in writing that the director
reduce a bond required pursuant to this section. The director may reduce a bond if the
director determines that the self-insurer or partial self-insurer has continuously
complied with this article and the self-insurer or partial self-insurer has not incurred
claims for accidents involving motor vehicles for at least the previous three consecutive
years. If the director determines that the reduction of the bond would jeopardize public
safety, the director may elect to retain the bond or may increase the bond amount
required. A person who is aggrieved by a decision of the director pursuant to this
subsection may appeal the decision by requesting a hearing.

D. If liability on the bond filed by the self-insurer or partial self-insurer with
the director is discharged or reduced or if in the opinion of the director a surety on
the bond given has become unsatisfactory or unacceptable, the director may require the
self-insurer or partial self-insurer to file a new bond with satisfactory sureties in the
same amount. If the self-insurer or partial self-insurer fails to file a new bond as
required, the director shall cancel the person's certificate of self-insurance or partial
self-insurance immediately. If a new bond is furnished by the self-insurer or partial
self-insurer, the director shall cancel and surrender the bond for which the new bond is
substituted.

E. If the director decides that the amount of the existing bond is insufficient to
ensure the safety of the public and the director gives the self-insurer or partial
self-insurer five days written notice mailed to the self-insurer's or partial
self-insurer's last known address, on the written demand of the director, the
self-insurer or partial self-insurer shall immediately file an additional bond in the
same manner and form with a surety company on the bond approved by the director in an
amount determined by the director as necessary to protect public safety at all times. If
the self-insurer or partial self-insurer fails to file an additional bond as required,
the director shall immediately cancel the certificate of self-insurance or partial
self-insurance of the person.

F. A surety on a bond furnished by a self-insurer or partial self-insurer shall be
released and discharged from all liability to this state accruing on the bond on the last
day of the month that includes the sixtieth day after the date on which the surety files
with the director a written request to be released and discharged. The request does not
relieve, release or discharge the surety from liability already accrued or from liability
that accrues before the last day of the month that includes the end of the sixty day
period. On receipt of notice of the request, the director shall promptly notify the
self-insurer or partial self-insurer who furnished the bond and shall immediately cancel
the certificate of self-insurance or partial self-insurance of the person, unless the
self-insurer or partial self-insurer, on or before the last day of the month that
includes the end of the sixty day period, files with the director a new bond with a
surety company satisfactory to the director in the amount and form provided in this
section. If a new bond is furnished by the self-insurer or partial self-insurer, the
director shall cancel and surrender the bond for which the new bond is substituted.