Printer-Friendly Version
Notice No. 119
August 2005
NOTICE TO INSURANCE CARRIERS UNDER THE LONGSHORE AND HARBOR
WORKERS' COMPENSATION ACT AND EXTENSIONS
SUBJECT: ANNUAL REPORT OF OUTSTANDING LIABILITIES FORM
LS-274 APPLICATION FOR SECURITY DEPOSIT DETERMINATION FORM LS-276
Note: This Notice reflects changes pursuant to new
regulations that will be effective on August 25, 2005. These regulations govern
insurance carrier security deposits under the Longshore and Harbor Workers'
Compensation Act and its extensions. The new regulations contain major changes
in the reporting requirements and the method of calculating carrier security
deposits. Please read this Notice very carefully. The text of the regulations
can be found at 70 Federal Register pages 43234-37 (July 26, 2005) (to be
codified at 20 C.F.R.§§703.201-703.213) or online at
www.gpoaccess.gov.
The most significant change is that the paid loss and
loss reserve information required to be reported on the Form LS-274 must now be
reported on a state by state basis with each state in which you write Longshore
Act business listed separately on the Form LS-274 and Form LS-276.
Form LS-274
In connection with the privilege to write workers'
compensation insurance under the Longshore and Harbor Workers' Compensation Act
and its extensions, this Office requires authorized insurance carriers to
submit an annual report of outstanding workers' compensation liabilities under
the Act, as of June 30 of each year. You must file a completed LS-274 even if
you apply for an exemption from the security deposit requirements (see below).
The report now due should show the following information for each open
Longshore case, with the cases listed separately by the state in which
the case arose, as of June 30, 2005:
- Claimant's Social Security Number (column a)
NOTE: the carrier's file number and employer number are not require;
- OWCP case number (column b)
NOTE: Include
the number for each open claim or claim on which benefits were paid during the
reporting period. Include all controverted claims and cases paid by the Special
Fund where the employer/carrier continues to be liable for any medical
benefits. It is the duty and responsibility of the insurance carrier to record
the OWCP case numbers of all their claims and report those numbers on the
LS-274 report;
- Name of injured employee (column c);
- Date of injury (column d)
Note: Not the date of loss;
- Nature of the injury (column e);
- Amount of compensation and medical benefits paid
through June 30, 2005 (column f)
Note: Include all compensation and
medical benefits that have been paid on the case from the date of injury to the
date of the report;
- Estimate of future compensation benefit payments
(column g)
Note: This amount should be projected on a worst case basis.
It should not be discounted or reduced based on expectations of a third party
recovery, anticipated section 8(f) relief or anticipated lump sum settlement.
Do not include attorney fees and/or other administrative costs or expenses;
- Estimate of future medical benefit payments (column
h)
Note: Use the same criteria for reporting as in item 7 above;
- Estimate of total compensation and medical payments
expected to be paid in the future (column i);
- Fatal cases are to be separately identified
(column j);
- Third party cases are to be identified (column k).
The report of outstanding liabilities may be submitted on
Form LS-274, Report of Injury Experience of Insurance Carriers (copy enclosed),
or in any other similar format that provides the same information, provided
that all of the required information is submitted. Form LS-274 is also
available online. Once again, please note that the cases for each state should be
segregated and the states' reports listed separately.
Insurance carriers must also provide separate reports
for the Act and each of its extensions, (i.e., Longshore and Harbor
Workers' Compensation Act, Outer Continental Shelf Lands Act, Defense Base Act,
and Nonappropriated Fund Instrumentalities Act). Also, insurance carriers with
subsidiaries that write insurance under these Acts must provide a separate
report for each subsidiary. Please include the applicable Department of
Labor authorization number on each report submitted.
All open claims reported are to be listed state by
state, chronologically, by accident date, for each July 1 through June
30 period. Subtotals of the estimated future payments requested in the first
paragraph above or as called for in column (g), (h), and (i) of Form LS-274 are
to be provided for each period.
Finally, each report should reflect a Grand Total for
each state for all estimated future payments. This insurance carrier's
annual report of outstanding liabilities is due no later than November 1,
2005 and must include a separate notarized statement signed by a corporate
officer attesting to the completeness and accuracy of the information provided.
Certification of the Report of Outstanding Liabilities
by other than corporate officers as indicated above will not be accepted. The signed statement should be on a separate letterhead. Please indicate in
your correspondence the name and telephone number of the person to be contacted
in the event there are any questions.
If an insurance carrier has no outstanding workers'
compensation liabilities under the Acts, an annual report noting the absence of
current liabilities must be filed for each company and each authorized
subsidiary. This report must also be accompanied with the same separate
notarized statement from a company official as mentioned earlier in this
notice.
In addition to Form LS-274, you must complete and file
Form LS-276, Application for Security Deposit Determination (copy
enclosed). This form is also available online.
If you are seeking an exemption from the security deposit requirements based on
your financial standing, you must include documentation establishing your
current rating and your rating from the immediately preceding year from each
insurance rating service designated by OWCP and posted online.
Ratings from A.M Best Company, Weiss Insurance Reports and Standard & Poors
are presently accepted. Insurance carriers with subsidiaries that write
insurance under the Longshore Act or its extensions must complete a separate
application for each subsidiary.
The totals of the obligations for each state listed in
detail on your Form LS-274 should be shown in Number 7 on your Form LS-276.
Using the values listed on the state guaranty fund summary provided by this
Office (copy enclosed), you should then apply the relevant value of either
100%, 33% or 0% for each state in order to calculate the "Estimated Deposit"
for that state. For example,
a. State |
b. Total |
c. Percent |
d. Estimated Obligations Unsecured Deposit |
West Virginia |
$200,000 |
100% |
$200,000 |
Maryland |
$200,000 |
0% |
$ 0 |
Delware |
$200,000 |
33% |
$66,000 |
The LS-276 must be signed by an appropriate officer of the
carrier. If the carrier is a corporation, you must also affix the corporate
seal.
Mail your completed annual report(s) and application(s) for
security deposit determination to this address:
U. S. Department of Labor
ESA/OWCP/DLHWC, Room C-4315
200 Constitution Ave., NW
Washington, DC 20210
Attn: Michael Niss
Failure to submit an annual report or application
for security deposit determination as outlined in this Notice may result in
the termination of your authorization to write insurance under the Longshore
Act and its extensions.
This insurance authorization cannot be transferred, and
it cannot be assigned. Any change involving the corporate name, structure,
ownership, organization, etc., may affect the insurance authority and must be
brought to the attention of this Office prior to the effective date of the
event.
For further information, contact the Longshore National
Office at (202) 693-0038.
Michael Niss
Director, Division of
Longshore and
Harbor
Workers' Compensation
Enclosure
|