Within 45 days of the date on which the employer receives the
Branch's decision (or, if the employer requests a hearing, a period set
by the Longshore Director or the Longshore Director's representative)
granting its application to self-insure and fixing the required security
deposit amount (see Sec. 703.303), the employer must:
(a) Execute and file with the Branch an Agreement and Undertaking,
in a form prescribed and provided by OWCP, in which the employer shall
agree to:
(1) Pay when due, as required by the provisions of the Act, all
compensation payable on account of injury or death of any of its
employees injured within the purview of the Act;
(2) Furnish medical, surgical, hospital, and other attendance,
treatment and care as required by the Act;
(3) Deposit with the Branch indemnity bonds or letters of credit in
the amount fixed by the Office, or deposit negotiable securities under
Sec. Sec. 703.306 and 703.307 in that amount;
(4) Authorize the Branch, at its discretion, to bring suit under any
deposited indemnity bond or to draw upon any deposited letters of
credit, as appropriate under the terms of the security instrument, or to
collect the interest and principal as they become due on any deposited
negotiable securities and to seize and sell or otherwise liquidate such
negotiable securities or any part thereof when the employer:
(i) Defaults on any of its LHWCA obligations;
(ii) Fails to renew any deposited letter of credit or substitute a
new letter of credit, indemnity bond or acceptable negotiable securities
in its place;
(iii) Fails to renew any deposited negotiable securities at maturity
or substitute a letter of credit, indemnity bond or acceptable
negotiable securities in their place; or
(iv) Fails to comply with any of the terms of the Agreement and
Undertaking;
(5) Authorize the Branch, at its discretion, to pay such
compensation, medical, and other expenses and any accrued penalties
imposed by law as it may find to be due and payable from the proceeds of
the deposited security; and
(6) Obtain and maintain, if required by the Office, excess or
catastrophic insurance in amounts to be determined by the Office.
(b) Give security in the amount fixed in the Office's decision:
(1) In the form of an indemnity bond with sureties satisfactory to
the Office, and in such form and containing such provisions as the
Office may prescribe: Provided, That only surety companies
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approved by the United States Treasury Department under the laws of the
United States and the rules and regulations governing bonding companies
may act as sureties on such indemnity bonds (see Department of
Treasury's Circular-570);
(2) In the form of letters of credit issued by a financial
institution satisfactory to the Branch and upon which the Branch may
draw; or,
(3) By a deposit of negotiable securities with a Federal Reserve
Bank or the Treasurer of the United States in compliance with Sec. Sec.
703.306 and 703.307.
