IC 22-3-5
Chapter 5. Worker's Compensation: Insurance Requirements
IC 22-3-5-1 Requirements; self-insurance; security; fees
Sec. 1. (a) Every employer under IC 22-3-2 through IC 22-3-6,
except those exempted by IC 22-3-2-5, shall:
(1) insure and keep insured the employer's liability under
IC 22-3-2 through IC 22-3-6 in some corporation, association,
or organization authorized to transact the business of worker's
compensation insurance in this state; or
(2) furnish to the worker's compensation board satisfactory
proof of the employer's financial ability to pay direct the
compensation in the amount and manner and when due as
provided in IC 22-3-2 through IC 22-3-6.
(b) Under subsection (a)(2) the board may require the deposit of
an acceptable security, indemnity, or bond to secure the payment of
compensation liabilities as they are incurred. The board shall charge
the following:
(1) An initial application fee of five hundred dollars ($500) to
be paid along with the proof of financial ability required under
this section.
(2) A renewal fee of two hundred fifty dollars ($250) if the
employer holds a certificate of self insurance.
(3) A late filing fee of two hundred fifty dollars ($250). (Formerly: Acts 1929, c.172, s.68.) As amended by P.L.144-1986,
SEC.50; P.L.28-1988, SEC.42; P.L.170-1991, SEC.12.
IC 22-3-5-2 Termination of insurance; filing fees; evidence of compliance
Sec. 2. An employer required to carry insurance under IC 22-3-2-5
and section 1 of this chapter shall file with the worker's
compensation board, in the form prescribed by it, within ten (10)
days after the termination of the employer's insurance by expiration
or cancellation, evidence of the employer's compliance with section
1 of this chapter and other provisions relating to the insurance under
IC 22-3-2 through IC 22-3-6 and shall pay a filing fee in the amount
of ten dollars ($10) before July 1, 1992; and five dollars ($5) on and
after July 1, 1992 and before July 1, 1995. Proof of renewal of an
existing insurance policy may be filed every three (3) years, but the
filing fee for the policy shall be paid annually. An employer coming
under the compensation provisions of IC 22-3-2 through IC 22-3-6
shall in a like manner file like evidence of compliance on the
employer's part. (Formerly: Acts 1929, c.172, s.69; Acts 1937, c.214, s.6.) As
amended by Acts 1978, P.L.2, SEC.2211; P.L.28-1988, SEC.43;
P.L.170-1991, SEC.13.
IC 22-3-5-3 Self-insurance; certificates; revocation
Sec. 3. (a) Whenever an employer has complied with the
provisions of section 1 of this chapter relating to self-insurance, the
worker's compensation board shall issue to such employer a
certificate which shall remain in force for a period fixed by the
board, but the board may upon at least ten (10) days notice and a
hearing to the employer revoke the certificate upon satisfactory
evidence for such revocation having been presented. At any time
after such revocation the board may grant a new certificate to the
employer upon the employer's petition and satisfactory proof of
financial ability.
(b) All such certificates issued by the industrial board before May
21, 1929, shall remain in force for the period for which they were
issued unless revoked as in this section provided. (Formerly: Acts 1929, c.172, s.70.) As amended by P.L.144-1986,
SEC.51; P.L.28-1988, SEC.44.
IC 22-3-5-4 Substitute system of insurance
Sec. 4. (a) Subject to the approval of the worker's compensation
board, any employer may enter into or continue any agreement with
the employer's employees to provide a system of compensation,
benefit, or insurance in lieu of the compensation and insurance
provided by IC 22-3-2 through IC 22-3-6. No such substitute system
shall be approved unless it confers benefits upon injured employees
and their dependents at least equivalent to the benefits provided by
IC 22-3-2 through IC 22-3-6, nor if it requires contributions from the
employees unless it confers benefits in addition to those provided
under IC 22-3-2 through IC 22-3-6 at least commensurate with such
contributions.
(b) Such substitute system may be terminated by the worker's
compensation board on reasonable notice and hearing to the
interested parties if it appears that the same is not fairly
administered, its operation discloses latent defects threatening its
solvency, or if for any substantial reason it fails to accomplish the
purpose of IC 22-3-2 through IC 22-3-6. In this case the board shall
determine upon the proper distribution of all remaining assets, if any,
subject to the right of any party in interest to take an appeal to the
court of appeals. (Formerly: Acts 1929, c.172, s.71.) As amended by P.L.144-1986,
SEC.52; P.L.28-1988, SEC.45.
IC 22-3-5-5 Policy provisions; failure to pay claims
Sec. 5. (a) No insurer shall enter into or issue any policy of
insurance under IC 22-3-2 through IC 22-3-6 until its policy form
shall have been submitted to and approved by the department of
insurance.
(b) All policies of insurance companies and of reciprocal
insurance associations insuring the payment of compensation under
IC 22-3-2 through IC 22-3-6 are conclusively presumed to cover all
the employees and the entire compensation liability of the insured.
Any provision in any policy attempting to limit or modify the
liability of the company or association issuing the same shall be
wholly void.
(c) Every policy of any such company or association is deemed to
include the following provisions and any change in the policy which
may be required by any statute enacted after May 21, 1929, as fully
as if they were written in the policy:
(1) Except as provided in section 5.5 of this chapter, the insurer
hereby assumes in full all the obligations to pay physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits imposed upon or
accepted by the insured under the provisions of IC 22-3-2
through IC 22-3-6.
(2) This policy is made subject to IC 22-3-2 through IC 22-3-6
relative to the liability of the insured to pay physician's fees,
nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits to and for the
employees, the acceptance of such liability by the insured, the
adjustment, trial, and adjudication of claims for such physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits, and the liability of
the insurer to pay the same are and shall be a part of this policy
contract as fully and completely as if written in this policy.
(3) As between this insurer and the employee, notice to or
knowledge of the occurrence of the injury on the part of the
insured (the employer) shall be notice or knowledge thereof, on
the part of the insurer. The jurisdiction of the insured (the
employer) for the purpose of IC 22-3-2 through IC 22-3-6 shall
be the jurisdiction of this insurer. This insurer shall in all things
be bound by and shall be subject to the awards, judgments, and
decrees rendered against the insured (the employer) under
IC 22-3-2 through IC 22-3-6.
(4) This insurer will promptly pay to the person entitled to the
same all benefits conferred by IC 22-3-2 through IC 22-3-6,
including physician's fees, nurse's charges, hospital services,
hospital supplies, burial expenses, and all installments of
compensation or death benefits that may be awarded or agreed
upon under IC 22-3-2 through IC 22-3-6. The obligation of this
insurer shall not be affected by any default of the insured (the
employer) after the injury or by any default in giving of any
notice required by this policy, or otherwise. This policy is a
direct promise by this insurer to the person entitled to
physician's fees, nurse's charges, fees for hospital services,
charges for hospital supplies, charges for burial compensation,
or death benefits, and shall be enforceable in the name of the
person.
(5) Any termination of this policy by cancellation shall not be
effective as to employees of the insured covered hereby unless
at least ten (10) days prior to the taking effect of such
cancellation, a written notice giving the date upon which such
termination is to become effective has been received by the
worker's compensation board of Indiana at its office in
Indianapolis, Indiana.
(6) This policy shall automatically expire one (1) year from the
effective date of the policy unless:
(A) the policy covers a period of three (3) years, in which
event, it shall automatically expire three (3) years from the
effective date of the policy; or
(B) the policy is issued as a continuous policy, in which
event it shall not expire until terminated by the insured or the
insurer in accord with applicable state law and applicable
policy provisions.
The termination of a policy, as provided in this subdivision,
shall be effective as to the employees of the insured covered by
the policy.
(d) All claims for compensation, nurse's charges, hospital
services, hospital supplies, physician's fees, or burial expenses may
be made directly against either the employer or the insurer or both,
and the award of the worker's compensation board may be made
against either the employer or the insurer or both. If any insurer shall
fail or refuse to pay final award or judgment (except during the
pendency of an appeal) rendered against it, or its insured, or, if it
shall fail or refuse to comply with any provision of IC 22-3-2 through
IC 22-3-6, the board shall not accept any further proofs of insurance
from it until it shall have paid the award or judgment or complied
with the violated provision of IC 22-3-2 through IC 22-3-6. (Formerly: Acts 1929, c.172, s.72; Acts 1943, c.247, s.1; Acts 1959,
c.371, s.1; Acts 1961, c.242, s.1.) As amended by P.L.144-1986,
SEC.53; P.L.28-1988, SEC.46; P.L.3-1989, SEC.133; P.L.249-1989,
SEC.18; P.L.170-1991, SEC.14; P.L.1-1994, SEC.109;
P.L.116-1994, SEC.2; P.L.2-1995, SEC.83; P.L.217-1995, SEC.1.
IC 22-3-5-5.5 Deductibles and co-insurance
Sec. 5.5. (a) Each insurer entering into or issuing an insurance
policy under IC 22-3-2 through IC 22-3-7 may, as a part of the policy
or as an optional endorsement to the policy, offer deductibles or
co-insurance, or both, that are optional to the insured for benefits
under IC 22-3-2 through IC 22-3-7. Each insurer may do the
following:
(1) Offer deductibles in multiples of five hundred dollars
($500), up to a maximum of five thousand dollars ($5,000) per
compensable claim.
(2) Offer co-insurance for each compensable claim. The
following apply to co-insurance provided under this
subdivision:
(A) The co-insurance must require the insurer to pay eighty
percent (80%) and the insured to pay twenty percent (20%)
of the amount of benefits due to an employee for an injury
compensable under IC 22-3-2 through IC 22-3-7.
(B) An insured employer may not be required to pay more
than four thousand two hundred dollars ($4,200) in
co-insurance under this subdivision for each compensable
claim.
(b) An insurer shall fully disclose in writing to prospective
policyholders the deductibles and co-insurance offered under
subsection (a). An insured employer who chooses a deductible under
subsection (a):
(1) may choose only one (1) deductible amount; and
(2) is liable for the amount of the deductible for benefits paid
for each compensable claim of an employee under IC 22-3-2
through IC 22-3-7.
(c) An insurer shall do the following:
(1) Where a policy provides for a deductible, the insurer shall:
(A) pay all or a part of the deductible amount, whichever is
applicable to a compensable claim, to the person or medical
provider entitled to the benefits under IC 22-3-2 through
IC 22-3-7; and
(B) seek reimbursement from the employer from the
applicable deductible.
(2) Where a policy provides a deductible or co-insurance, the
insurance company shall pay the full cost of the claim. The
insurance company shall seek reimbursement from the insured
employer for its portion of the liability following closing of the
claim or when twenty percent (20%) of the benefits paid exceed
four thousand two hundred dollars ($4,200).
(d) The payment or nonpayment of a deductible or co-insurance
amount by an insured employer to the insurer shall be treated under
the policy insuring the liability for worker's compensation in the
same manner as payment or nonpayment of premiums is treated.
(e) The premium reduction for deductibles or for co-insurance
shall be determined before the application of any experience
modifications, premium surcharges, or premium discounts. The
applicable premium reduction percentage is the percentage
corresponding to the appropriate deductible or co-insurance amount.
The premium reduction is obtained by the application of the
appropriate reduction percentage, shown under miscellaneous values
in the rate pages, to the premium determined before application of
any experience or schedule modification, premium discounts, or any
retrospective rating plan.
(f) This section does not apply to the following:
(1) An employer that is authorized to self-insure against liability
for claims under IC 22-3-2 through IC 22-3-6.
(2) Group self-insurance funds for claims under IC 22-3-2
through IC 22-3-6.
(g) A deductible or co-insurance provided under this section
applies against the total of all benefits paid for a compensable claim,
including benefits paid under the following:
(1) IC 22-3-3-4.
(2) IC 22-3-3-8 through IC 22-3-3-10.
(3) IC 22-3-3-17.
(4) IC 22-3-3-22.
(h) An employer may not use the employer's election of a
deductible or co-insurance under this section or the payment of a
deductible or co-insurance under this section in negotiating with the
employer's employees on any terms of employment. An employee of
an employer that knowingly violates this subsection may file a
complaint with the department of labor. The department of labor may
impose a civil penalty of not more than one thousand dollars
($1,000) against an employer that knowingly violates this subsection.
(i) This subsection applies to an employee of an employer that has
paid a deductible or co-insurance under this section and to the
employee's dependents. If an employee or a dependent recovers
damages against a third party under IC 22-3-2-13, the insurer shall
provide reimbursement to the insured equal to a pro-rata share of the
net recovery by the insurer. As added by P.L.170-1991, SEC.15.
IC 22-3-5-6 Supplemental administrative fund
Sec. 6. (a) The worker's compensation supplemental
administrative fund is established for the purpose of carrying out the
administrative purposes and functions of the worker's compensation
board. The fund consists of fees collected from employers under
sections 1 through 2 of this chapter and from fees collected under
IC 22-3-2-14.5 and IC 22-3-7-34.5. The fund shall be administered
by the worker's compensation board. Money in the fund is annually
appropriated to the worker's compensation board and shall be used
for all expenses incurred by the worker's compensation board.
(b) The money in the fund is not to be used to replace funds
otherwise appropriated to the board. Money in the fund at the end of
the state fiscal year does not revert to the state general fund. As added by P.L.170-1991, SEC.16. Amended by P.L.75-1993,
SEC.4; P.L.202-2001, SEC.6.
IC 22-3-5
Chapter 5. Worker's Compensation: Insurance Requirements
IC 22-3-5-1 Requirements; self-insurance; security; fees
Sec. 1. (a) Every employer under IC 22-3-2 through IC 22-3-6,
except those exempted by IC 22-3-2-5, shall:
(1) insure and keep insured the employer's liability under
IC 22-3-2 through IC 22-3-6 in some corporation, association,
or organization authorized to transact the business of worker's
compensation insurance in this state; or
(2) furnish to the worker's compensation board satisfactory
proof of the employer's financial ability to pay direct the
compensation in the amount and manner and when due as
provided in IC 22-3-2 through IC 22-3-6.
(b) Under subsection (a)(2) the board may require the deposit of
an acceptable security, indemnity, or bond to secure the payment of
compensation liabilities as they are incurred. The board shall charge
the following:
(1) An initial application fee of five hundred dollars ($500) to
be paid along with the proof of financial ability required under
this section.
(2) A renewal fee of two hundred fifty dollars ($250) if the
employer holds a certificate of self insurance.
(3) A late filing fee of two hundred fifty dollars ($250). (Formerly: Acts 1929, c.172, s.68.) As amended by P.L.144-1986,
SEC.50; P.L.28-1988, SEC.42; P.L.170-1991, SEC.12.
IC 22-3-5-2 Termination of insurance; filing fees; evidence of compliance
Sec. 2. An employer required to carry insurance under IC 22-3-2-5
and section 1 of this chapter shall file with the worker's
compensation board, in the form prescribed by it, within ten (10)
days after the termination of the employer's insurance by expiration
or cancellation, evidence of the employer's compliance with section
1 of this chapter and other provisions relating to the insurance under
IC 22-3-2 through IC 22-3-6 and shall pay a filing fee in the amount
of ten dollars ($10) before July 1, 1992; and five dollars ($5) on and
after July 1, 1992 and before July 1, 1995. Proof of renewal of an
existing insurance policy may be filed every three (3) years, but the
filing fee for the policy shall be paid annually. An employer coming
under the compensation provisions of IC 22-3-2 through IC 22-3-6
shall in a like manner file like evidence of compliance on the
employer's part. (Formerly: Acts 1929, c.172, s.69; Acts 1937, c.214, s.6.) As
amended by Acts 1978, P.L.2, SEC.2211; P.L.28-1988, SEC.43;
P.L.170-1991, SEC.13.
IC 22-3-5-3 Self-insurance; certificates; revocation
Sec. 3. (a) Whenever an employer has complied with the
provisions of section 1 of this chapter relating to self-insurance, the
worker's compensation board shall issue to such employer a
certificate which shall remain in force for a period fixed by the
board, but the board may upon at least ten (10) days notice and a
hearing to the employer revoke the certificate upon satisfactory
evidence for such revocation having been presented. At any time
after such revocation the board may grant a new certificate to the
employer upon the employer's petition and satisfactory proof of
financial ability.
(b) All such certificates issued by the industrial board before May
21, 1929, shall remain in force for the period for which they were
issued unless revoked as in this section provided. (Formerly: Acts 1929, c.172, s.70.) As amended by P.L.144-1986,
SEC.51; P.L.28-1988, SEC.44.
IC 22-3-5-4 Substitute system of insurance
Sec. 4. (a) Subject to the approval of the worker's compensation
board, any employer may enter into or continue any agreement with
the employer's employees to provide a system of compensation,
benefit, or insurance in lieu of the compensation and insurance
provided by IC 22-3-2 through IC 22-3-6. No such substitute system
shall be approved unless it confers benefits upon injured employees
and their dependents at least equivalent to the benefits provided by
IC 22-3-2 through IC 22-3-6, nor if it requires contributions from the
employees unless it confers benefits in addition to those provided
under IC 22-3-2 through IC 22-3-6 at least commensurate with such
contributions.
(b) Such substitute system may be terminated by the worker's
compensation board on reasonable notice and hearing to the
interested parties if it appears that the same is not fairly
administered, its operation discloses latent defects threatening its
solvency, or if for any substantial reason it fails to accomplish the
purpose of IC 22-3-2 through IC 22-3-6. In this case the board shall
determine upon the proper distribution of all remaining assets, if any,
subject to the right of any party in interest to take an appeal to the
court of appeals. (Formerly: Acts 1929, c.172, s.71.) As amended by P.L.144-1986,
SEC.52; P.L.28-1988, SEC.45.
IC 22-3-5-5 Policy provisions; failure to pay claims
Sec. 5. (a) No insurer shall enter into or issue any policy of
insurance under IC 22-3-2 through IC 22-3-6 until its policy form
shall have been submitted to and approved by the department of
insurance.
(b) All policies of insurance companies and of reciprocal
insurance associations insuring the payment of compensation under
IC 22-3-2 through IC 22-3-6 are conclusively presumed to cover all
the employees and the entire compensation liability of the insured.
Any provision in any policy attempting to limit or modify the
liability of the company or association issuing the same shall be
wholly void.
(c) Every policy of any such company or association is deemed to
include the following provisions and any change in the policy which
may be required by any statute enacted after May 21, 1929, as fully
as if they were written in the policy:
(1) Except as provided in section 5.5 of this chapter, the insurer
hereby assumes in full all the obligations to pay physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits imposed upon or
accepted by the insured under the provisions of IC 22-3-2
through IC 22-3-6.
(2) This policy is made subject to IC 22-3-2 through IC 22-3-6
relative to the liability of the insured to pay physician's fees,
nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits to and for the
employees, the acceptance of such liability by the insured, the
adjustment, trial, and adjudication of claims for such physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits, and the liability of
the insurer to pay the same are and shall be a part of this policy
contract as fully and completely as if written in this policy.
(3) As between this insurer and the employee, notice to or
knowledge of the occurrence of the injury on the part of the
insured (the employer) shall be notice or knowledge thereof, on
the part of the insurer. The jurisdiction of the insured (the
employer) for the purpose of IC 22-3-2 through IC 22-3-6 shall
be the jurisdiction of this insurer. This insurer shall in all things
be bound by and shall be subject to the awards, judgments, and
decrees rendered against the insured (the employer) under
IC 22-3-2 through IC 22-3-6.
(4) This insurer will promptly pay to the person entitled to the
same all benefits conferred by IC 22-3-2 through IC 22-3-6,
including physician's fees, nurse's charges, hospital services,
hospital supplies, burial expenses, and all installments of
compensation or death benefits that may be awarded or agreed
upon under IC 22-3-2 through IC 22-3-6. The obligation of this
insurer shall not be affected by any default of the insured (the
employer) after the injury or by any default in giving of any
notice required by this policy, or otherwise. This policy is a
direct promise by this insurer to the person entitled to
physician's fees, nurse's charges, fees for hospital services,
charges for hospital supplies, charges for burial compensation,
or death benefits, and shall be enforceable in the name of the
person.
(5) Any termination of this policy by cancellation shall not be
effective as to employees of the insured covered hereby unless
at least ten (10) days prior to the taking effect of such
cancellation, a written notice giving the date upon which such
termination is to become effective has been received by the
worker's compensation board of Indiana at its office in
Indianapolis, Indiana.
(6) This policy shall automatically expire one (1) year from the
effective date of the policy unless:
(A) the policy covers a period of three (3) years, in which
event, it shall automatically expire three (3) years from the
effective date of the policy; or
(B) the policy is issued as a continuous policy, in which
event it shall not expire until terminated by the insured or the
insurer in accord with applicable state law and applicable
policy provisions.
The termination of a policy, as provided in this subdivision,
shall be effective as to the employees of the insured covered by
the policy.
(d) All claims for compensation, nurse's charges, hospital
services, hospital supplies, physician's fees, or burial expenses may
be made directly against either the employer or the insurer or both,
and the award of the worker's compensation board may be made
against either the employer or the insurer or both. If any insurer shall
fail or refuse to pay final award or judgment (except during the
pendency of an appeal) rendered against it, or its insured, or, if it
shall fail or refuse to comply with any provision of IC 22-3-2 through
IC 22-3-6, the board shall not accept any further proofs of insurance
from it until it shall have paid the award or judgment or complied
with the violated provision of IC 22-3-2 through IC 22-3-6. (Formerly: Acts 1929, c.172, s.72; Acts 1943, c.247, s.1; Acts 1959,
c.371, s.1; Acts 1961, c.242, s.1.) As amended by P.L.144-1986,
SEC.53; P.L.28-1988, SEC.46; P.L.3-1989, SEC.133; P.L.249-1989,
SEC.18; P.L.170-1991, SEC.14; P.L.1-1994, SEC.109;
P.L.116-1994, SEC.2; P.L.2-1995, SEC.83; P.L.217-1995, SEC.1.
IC 22-3-5-5.5 Deductibles and co-insurance
Sec. 5.5. (a) Each insurer entering into or issuing an insurance
policy under IC 22-3-2 through IC 22-3-7 may, as a part of the policy
or as an optional endorsement to the policy, offer deductibles or
co-insurance, or both, that are optional to the insured for benefits
under IC 22-3-2 through IC 22-3-7. Each insurer may do the
following:
(1) Offer deductibles in multiples of five hundred dollars
($500), up to a maximum of five thousand dollars ($5,000) per
compensable claim.
(2) Offer co-insurance for each compensable claim. The
following apply to co-insurance provided under this
subdivision:
(A) The co-insurance must require the insurer to pay eighty
percent (80%) and the insured to pay twenty percent (20%)
of the amount of benefits due to an employee for an injury
compensable under IC 22-3-2 through IC 22-3-7.
(B) An insured employer may not be required to pay more
than four thousand two hundred dollars ($4,200) in
co-insurance under this subdivision for each compensable
claim.
(b) An insurer shall fully disclose in writing to prospective
policyholders the deductibles and co-insurance offered under
subsection (a). An insured employer who chooses a deductible under
subsection (a):
(1) may choose only one (1) deductible amount; and
(2) is liable for the amount of the deductible for benefits paid
for each compensable claim of an employee under IC 22-3-2
through IC 22-3-7.
(c) An insurer shall do the following:
(1) Where a policy provides for a deductible, the insurer shall:
(A) pay all or a part of the deductible amount, whichever is
applicable to a compensable claim, to the person or medical
provider entitled to the benefits under IC 22-3-2 through
IC 22-3-7; and
(B) seek reimbursement from the employer from the
applicable deductible.
(2) Where a policy provides a deductible or co-insurance, the
insurance company shall pay the full cost of the claim. The
insurance company shall seek reimbursement from the insured
employer for its portion of the liability following closing of the
claim or when twenty percent (20%) of the benefits paid exceed
four thousand two hundred dollars ($4,200).
(d) The payment or nonpayment of a deductible or co-insurance
amount by an insured employer to the insurer shall be treated under
the policy insuring the liability for worker's compensation in the
same manner as payment or nonpayment of premiums is treated.
(e) The premium reduction for deductibles or for co-insurance
shall be determined before the application of any experience
modifications, premium surcharges, or premium discounts. The
applicable premium reduction percentage is the percentage
corresponding to the appropriate deductible or co-insurance amount.
The premium reduction is obtained by the application of the
appropriate reduction percentage, shown under miscellaneous values
in the rate pages, to the premium determined before application of
any experience or schedule modification, premium discounts, or any
retrospective rating plan.
(f) This section does not apply to the following:
(1) An employer that is authorized to self-insure against liability
for claims under IC 22-3-2 through IC 22-3-6.
(2) Group self-insurance funds for claims under IC 22-3-2
through IC 22-3-6.
(g) A deductible or co-insurance provided under this section
applies against the total of all benefits paid for a compensable claim,
including benefits paid under the following:
(1) IC 22-3-3-4.
(2) IC 22-3-3-8 through IC 22-3-3-10.
(3) IC 22-3-3-17.
(4) IC 22-3-3-22.
(h) An employer may not use the employer's election of a
deductible or co-insurance under this section or the payment of a
deductible or co-insurance under this section in negotiating with the
employer's employees on any terms of employment. An employee of
an employer that knowingly violates this subsection may file a
complaint with the department of labor. The department of labor may
impose a civil penalty of not more than one thousand dollars
($1,000) against an employer that knowingly violates this subsection.
(i) This subsection applies to an employee of an employer that has
paid a deductible or co-insurance under this section and to the
employee's dependents. If an employee or a dependent recovers
damages against a third party under IC 22-3-2-13, the insurer shall
provide reimbursement to the insured equal to a pro-rata share of the
net recovery by the insurer. As added by P.L.170-1991, SEC.15.
IC 22-3-5-6 Supplemental administrative fund
Sec. 6. (a) The worker's compensation supplemental
administrative fund is established for the purpose of carrying out the
administrative purposes and functions of the worker's compensation
board. The fund consists of fees collected from employers under
sections 1 through 2 of this chapter and from fees collected under
IC 22-3-2-14.5 and IC 22-3-7-34.5. The fund shall be administered
by the worker's compensation board. Money in the fund is annually
appropriated to the worker's compensation board and shall be used
for all expenses incurred by the worker's compensation board.
(b) The money in the fund is not to be used to replace funds
otherwise appropriated to the board. Money in the fund at the end of
the state fiscal year does not revert to the state general fund. As added by P.L.170-1991, SEC.16. Amended by P.L.75-1993,
SEC.4; P.L.202-2001, SEC.6.
IC 22-3-5
Chapter 5. Worker's Compensation: Insurance Requirements
IC 22-3-5-1 Requirements; self-insurance; security; fees
Sec. 1. (a) Every employer under IC 22-3-2 through IC 22-3-6,
except those exempted by IC 22-3-2-5, shall:
(1) insure and keep insured the employer's liability under
IC 22-3-2 through IC 22-3-6 in some corporation, association,
or organization authorized to transact the business of worker's
compensation insurance in this state; or
(2) furnish to the worker's compensation board satisfactory
proof of the employer's financial ability to pay direct the
compensation in the amount and manner and when due as
provided in IC 22-3-2 through IC 22-3-6.
(b) Under subsection (a)(2) the board may require the deposit of
an acceptable security, indemnity, or bond to secure the payment of
compensation liabilities as they are incurred. The board shall charge
the following:
(1) An initial application fee of five hundred dollars ($500) to
be paid along with the proof of financial ability required under
this section.
(2) A renewal fee of two hundred fifty dollars ($250) if the
employer holds a certificate of self insurance.
(3) A late filing fee of two hundred fifty dollars ($250). (Formerly: Acts 1929, c.172, s.68.) As amended by P.L.144-1986,
SEC.50; P.L.28-1988, SEC.42; P.L.170-1991, SEC.12.
IC 22-3-5-2 Termination of insurance; filing fees; evidence of compliance
Sec. 2. An employer required to carry insurance under IC 22-3-2-5
and section 1 of this chapter shall file with the worker's
compensation board, in the form prescribed by it, within ten (10)
days after the termination of the employer's insurance by expiration
or cancellation, evidence of the employer's compliance with section
1 of this chapter and other provisions relating to the insurance under
IC 22-3-2 through IC 22-3-6 and shall pay a filing fee in the amount
of ten dollars ($10) before July 1, 1992; and five dollars ($5) on and
after July 1, 1992 and before July 1, 1995. Proof of renewal of an
existing insurance policy may be filed every three (3) years, but the
filing fee for the policy shall be paid annually. An employer coming
under the compensation provisions of IC 22-3-2 through IC 22-3-6
shall in a like manner file like evidence of compliance on the
employer's part. (Formerly: Acts 1929, c.172, s.69; Acts 1937, c.214, s.6.) As
amended by Acts 1978, P.L.2, SEC.2211; P.L.28-1988, SEC.43;
P.L.170-1991, SEC.13.
IC 22-3-5-3 Self-insurance; certificates; revocation
Sec. 3. (a) Whenever an employer has complied with the
provisions of section 1 of this chapter relating to self-insurance, the
worker's compensation board shall issue to such employer a
certificate which shall remain in force for a period fixed by the
board, but the board may upon at least ten (10) days notice and a
hearing to the employer revoke the certificate upon satisfactory
evidence for such revocation having been presented. At any time
after such revocation the board may grant a new certificate to the
employer upon the employer's petition and satisfactory proof of
financial ability.
(b) All such certificates issued by the industrial board before May
21, 1929, shall remain in force for the period for which they were
issued unless revoked as in this section provided. (Formerly: Acts 1929, c.172, s.70.) As amended by P.L.144-1986,
SEC.51; P.L.28-1988, SEC.44.
IC 22-3-5-4 Substitute system of insurance
Sec. 4. (a) Subject to the approval of the worker's compensation
board, any employer may enter into or continue any agreement with
the employer's employees to provide a system of compensation,
benefit, or insurance in lieu of the compensation and insurance
provided by IC 22-3-2 through IC 22-3-6. No such substitute system
shall be approved unless it confers benefits upon injured employees
and their dependents at least equivalent to the benefits provided by
IC 22-3-2 through IC 22-3-6, nor if it requires contributions from the
employees unless it confers benefits in addition to those provided
under IC 22-3-2 through IC 22-3-6 at least commensurate with such
contributions.
(b) Such substitute system may be terminated by the worker's
compensation board on reasonable notice and hearing to the
interested parties if it appears that the same is not fairly
administered, its operation discloses latent defects threatening its
solvency, or if for any substantial reason it fails to accomplish the
purpose of IC 22-3-2 through IC 22-3-6. In this case the board shall
determine upon the proper distribution of all remaining assets, if any,
subject to the right of any party in interest to take an appeal to the
court of appeals. (Formerly: Acts 1929, c.172, s.71.) As amended by P.L.144-1986,
SEC.52; P.L.28-1988, SEC.45.
IC 22-3-5-5 Policy provisions; failure to pay claims
Sec. 5. (a) No insurer shall enter into or issue any policy of
insurance under IC 22-3-2 through IC 22-3-6 until its policy form
shall have been submitted to and approved by the department of
insurance.
(b) All policies of insurance companies and of reciprocal
insurance associations insuring the payment of compensation under
IC 22-3-2 through IC 22-3-6 are conclusively presumed to cover all
the employees and the entire compensation liability of the insured.
Any provision in any policy attempting to limit or modify the
liability of the company or association issuing the same shall be
wholly void.
(c) Every policy of any such company or association is deemed to
include the following provisions and any change in the policy which
may be required by any statute enacted after May 21, 1929, as fully
as if they were written in the policy:
(1) Except as provided in section 5.5 of this chapter, the insurer
hereby assumes in full all the obligations to pay physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits imposed upon or
accepted by the insured under the provisions of IC 22-3-2
through IC 22-3-6.
(2) This policy is made subject to IC 22-3-2 through IC 22-3-6
relative to the liability of the insured to pay physician's fees,
nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits to and for the
employees, the acceptance of such liability by the insured, the
adjustment, trial, and adjudication of claims for such physician's
fees, nurse's charges, hospital services, hospital supplies, burial
expenses, compensation, or death benefits, and the liability of
the insurer to pay the same are and shall be a part of this policy
contract as fully and completely as if written in this policy.
(3) As between this insurer and the employee, notice to or
knowledge of the occurrence of the injury on the part of the
insured (the employer) shall be notice or knowledge thereof, on
the part of the insurer. The jurisdiction of the insured (the
employer) for the purpose of IC 22-3-2 through IC 22-3-6 shall
be the jurisdiction of this insurer. This insurer shall in all things
be bound by and shall be subject to the awards, judgments, and
decrees rendered against the insured (the employer) under
IC 22-3-2 through IC 22-3-6.
(4) This insurer will promptly pay to the person entitled to the
same all benefits conferred by IC 22-3-2 through IC 22-3-6,
including physician's fees, nurse's charges, hospital services,
hospital supplies, burial expenses, and all installments of
compensation or death benefits that may be awarded or agreed
upon under IC 22-3-2 through IC 22-3-6. The obligation of this
insurer shall not be affected by any default of the insured (the
employer) after the injury or by any default in giving of any
notice required by this policy, or otherwise. This policy is a
direct promise by this insurer to the person entitled to
physician's fees, nurse's charges, fees for hospital services,
charges for hospital supplies, charges for burial compensation,
or death benefits, and shall be enforceable in the name of the
person.
(5) Any termination of this policy by cancellation shall not be
effective as to employees of the insured covered hereby unless
at least ten (10) days prior to the taking effect of such
cancellation, a written notice giving the date upon which such
termination is to become effective has been received by the
worker's compensation board of Indiana at its office in
Indianapolis, Indiana.
(6) This policy shall automatically expire one (1) year from the
effective date of the policy unless:
(A) the policy covers a period of three (3) years, in which
event, it shall automatically expire three (3) years from the
effective date of the policy; or
(B) the policy is issued as a continuous policy, in which
event it shall not expire until terminated by the insured or the
insurer in accord with applicable state law and applicable
policy provisions.
The termination of a policy, as provided in this subdivision,
shall be effective as to the employees of the insured covered by
the policy.
(d) All claims for compensation, nurse's charges, hospital
services, hospital supplies, physician's fees, or burial expenses may
be made directly against either the employer or the insurer or both,
and the award of the worker's compensation board may be made
against either the employer or the insurer or both. If any insurer shall
fail or refuse to pay final award or judgment (except during the
pendency of an appeal) rendered against it, or its insured, or, if it
shall fail or refuse to comply with any provision of IC 22-3-2 through
IC 22-3-6, the board shall not accept any further proofs of insurance
from it until it shall have paid the award or judgment or complied
with the violated provision of IC 22-3-2 through IC 22-3-6. (Formerly: Acts 1929, c.172, s.72; Acts 1943, c.247, s.1; Acts 1959,
c.371, s.1; Acts 1961, c.242, s.1.) As amended by P.L.144-1986,
SEC.53; P.L.28-1988, SEC.46; P.L.3-1989, SEC.133; P.L.249-1989,
SEC.18; P.L.170-1991, SEC.14; P.L.1-1994, SEC.109;
P.L.116-1994, SEC.2; P.L.2-1995, SEC.83; P.L.217-1995, SEC.1.
IC 22-3-5-5.5 Deductibles and co-insurance
Sec. 5.5. (a) Each insurer entering into or issuing an insurance
policy under IC 22-3-2 through IC 22-3-7 may, as a part of the policy
or as an optional endorsement to the policy, offer deductibles or
co-insurance, or both, that are optional to the insured for benefits
under IC 22-3-2 through IC 22-3-7. Each insurer may do the
following:
(1) Offer deductibles in multiples of five hundred dollars
($500), up to a maximum of five thousand dollars ($5,000) per
compensable claim.
(2) Offer co-insurance for each compensable claim. The
following apply to co-insurance provided under this
subdivision:
(A) The co-insurance must require the insurer to pay eighty
percent (80%) and the insured to pay twenty percent (20%)
of the amount of benefits due to an employee for an injury
compensable under IC 22-3-2 through IC 22-3-7.
(B) An insured employer may not be required to pay more
than four thousand two hundred dollars ($4,200) in
co-insurance under this subdivision for each compensable
claim.
(b) An insurer shall fully disclose in writing to prospective
policyholders the deductibles and co-insurance offered under
subsection (a). An insured employer who chooses a deductible under
subsection (a):
(1) may choose only one (1) deductible amount; and
(2) is liable for the amount of the deductible for benefits paid
for each compensable claim of an employee under IC 22-3-2
through IC 22-3-7.
(c) An insurer shall do the following:
(1) Where a policy provides for a deductible, the insurer shall:
(A) pay all or a part of the deductible amount, whichever is
applicable to a compensable claim, to the person or medical
provider entitled to the benefits under IC 22-3-2 through
IC 22-3-7; and
(B) seek reimbursement from the employer from the
applicable deductible.
(2) Where a policy provides a deductible or co-insurance, the
insurance company shall pay the full cost of the claim. The
insurance company shall seek reimbursement from the insured
employer for its portion of the liability following closing of the
claim or when twenty percent (20%) of the benefits paid exceed
four thousand two hundred dollars ($4,200).
(d) The payment or nonpayment of a deductible or co-insurance
amount by an insured employer to the insurer shall be treated under
the policy insuring the liability for worker's compensation in the
same manner as payment or nonpayment of premiums is treated.
(e) The premium reduction for deductibles or for co-insurance
shall be determined before the application of any experience
modifications, premium surcharges, or premium discounts. The
applicable premium reduction percentage is the percentage
corresponding to the appropriate deductible or co-insurance amount.
The premium reduction is obtained by the application of the
appropriate reduction percentage, shown under miscellaneous values
in the rate pages, to the premium determined before application of
any experience or schedule modification, premium discounts, or any
retrospective rating plan.
(f) This section does not apply to the following:
(1) An employer that is authorized to self-insure against liability
for claims under IC 22-3-2 through IC 22-3-6.
(2) Group self-insurance funds for claims under IC 22-3-2
through IC 22-3-6.
(g) A deductible or co-insurance provided under this section
applies against the total of all benefits paid for a compensable claim,
including benefits paid under the following:
(1) IC 22-3-3-4.
(2) IC 22-3-3-8 through IC 22-3-3-10.
(3) IC 22-3-3-17.
(4) IC 22-3-3-22.
(h) An employer may not use the employer's election of a
deductible or co-insurance under this section or the payment of a
deductible or co-insurance under this section in negotiating with the
employer's employees on any terms of employment. An employee of
an employer that knowingly violates this subsection may file a
complaint with the department of labor. The department of labor may
impose a civil penalty of not more than one thousand dollars
($1,000) against an employer that knowingly violates this subsection.
(i) This subsection applies to an employee of an employer that has
paid a deductible or co-insurance under this section and to the
employee's dependents. If an employee or a dependent recovers
damages against a third party under IC 22-3-2-13, the insurer shall
provide reimbursement to the insured equal to a pro-rata share of the
net recovery by the insurer. As added by P.L.170-1991, SEC.15.
IC 22-3-5-6 Supplemental administrative fund
Sec. 6. (a) The worker's compensation supplemental
administrative fund is established for the purpose of carrying out the
administrative purposes and functions of the worker's compensation
board. The fund consists of fees collected from employers under
sections 1 through 2 of this chapter and from fees collected under
IC 22-3-2-14.5 and IC 22-3-7-34.5. The fund shall be administered
by the worker's compensation board. Money in the fund is annually
appropriated to the worker's compensation board and shall be used
for all expenses incurred by the worker's compensation board.
(b) The money in the fund is not to be used to replace funds
otherwise appropriated to the board. Money in the fund at the end of
the state fiscal year does not revert to the state general fund. As added by P.L.170-1991, SEC.16. Amended by P.L.75-1993,
SEC.4; P.L.202-2001, SEC.6.
