SECTION 365:15-1-3.1. Workers' compensation optional deductible form  


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  • (a)   The Administrative Workers' Compensation Act, 85A O.S. § 95 ("AWCA"), requires insurers issuing policies of workers' compensation insurance to offer, as a part of the policy or as an endorsement to the policy, deductibles, optional to the policyholder, for benefits payable under the AWCA. Each policy of workers' compensation that is issued, delivered, issued for delivery, or renewed under the AWCA shall include such optional deductible. The mandatory optional deductible required by the AWCA will be satisfied by the offer of a "Small Deductible" as defined in this Section. If an applicant and insurer mutually agree to a Large or Mega Deductible, such agreement shall satisfy the requirement of the AWCA that insurers offer optional deductibles. The selection of a Small, Large, or Mega Deductible shall be evidenced by signature of the applicant employer on the Commissioner's designated Acceptance/Rejection Form as contained in Appendix "B" to this Chapter. As used in this Section:
    (1)   "Deductible" means a policy provision or endorsement that, while requiring the insurer to pay 100% of each covered claim, creates a corresponding obligation of the insured employer to reimburse the insurance company for any portion of that claim that is part of the deductible.
    (2)   "Small Deductible" means a combined medical benefits and indemnity claims deductible of $1,000.00; $2,000.00; $3,000.00; $4,000.00, or $5,000.00 per claim.
    (3)   "Large Deductible" means a combined medical benefits and indemnity claims deductible greater than $5,000.00 but not more than $100,000.00 per claim. A Large Deductible may be offered to applicants, on negotiated terms, based upon the applicant's financial condition, industry, claims experience, and collateral.
    (4)   "Mega Deductible" means a combined medical benefits and indemnity claims deductible greater than $100,000.00 per claim. Mega Deductibles are subject to OAC 365:15-1-3.2.
    (b)   Insurers may offer a contractual limit on the employer's aggregate reimbursement liability.
    (c)   Obligations If Deductible Option Is Selected
    (1)   If the policyholder chooses a deductible, the insured employer shall be liable for the amount of the deductible for benefits paid for each compensable claim of work injury suffered by an employee.
    (2)   The insurer shall pay all or part of the deductible amount, whichever is applicable to a compensable claim, to the person or medical providers entitled to the benefits conferred by the AWCA, and seek reimbursement from the insured employer for the applicable deductible amount.
    (3)   The insured employer must reimburse the insurer within sixty (60) days of a written demand. If the insured employer fails to reimburse the insurer within sixty (60) days, the insurer may seek to recover the full amount of such claim from the insured employer. In addition, the non-payment of deductible amounts shall be treated in the same manner as non-payment of premiums for purposes of cancellation.
    (d)   Experience Modification for Small Deductibles. Premium reduction for deductibles shall be determined after the application of any experience modification, premium surcharge, or premium discounts. Benefits paid by the insured employer in connection with a small deductible shall not constitute benefits paid and shall not be charged against the experience of the employer.
    (e)   Experience Modification for Large or Mega Deductibles. Premium reduction for deductibles shall be determined after the application of any experience modification, premium surcharge, or premium discounts. Benefits paid by the insured employer in connection with a large or mega deductible shall constitute benefits paid and shall be charged against the experience of the employer.
[Source: Added at 11 Ok Reg 1855, eff 5-15-94; Amended at 24 Ok Reg 2209, eff 7-14-07; Amended at 30 Ok Reg 1782, eff 7-14-13; Amended at 32 Ok Reg 1942, eff 9-15-15; Amended at 33 Ok Reg 1705, eff 9-15-16]