A. Good Faith.

The following rules will govern the insuring of employers who are in “good faith entitled to workers' compensation insurance” as defined herein, but who are unable to procure such insurance in a regular manner. For purposes of this Plan, the offer of any reasonable rating plan approved for use in this jurisdiction shall be deemed an offer of insurance in a regular manner. Any dispute arising hereunder shall be subject to the dispute resolution procedure provided in this Plan.

Good faith will be presumed in the absence of clear and convincing evidence to the contrary. An employer is not in good faith entitled to insurance if any of the following circumstances exist at the time of application or thereafter, or other evidence exists that such employer is not in good faith entitled to insurance.

B. Declinations

Within sixty (60) days preceding the date of application, the employer must have applied for workers' compensation coverage and have been rejected by at least two (2) insurers, specifically including, where applicable, the insurer providing coverage to the employer at the time of application.

Within sixty (60) days preceding the date of application, the employer must not have rejected a “voluntary offer of coverage” from an insurer.

The employer or its representative shall maintain on record for this policy period the insurer name, contact person, address, phone number and date of contact for each insurance company with which it applied for workers' compensation coverage and make such information available to the Plan Administrator or servicing carrier upon request.

C. Forms and Rates

All policies issued to employers to which this Plan applies shall be written utilizing the classifications, forms, rates, and rating plans approved by the Commissioner and authorized for use in the residual market by the Plan Administrator.

D. Securing a Requested Effective Date

The employer or its representative shall forward an application to the Plan Administrator using one of the submission methods established by the Plan Administrator.

The employer or its representative may request an effective date not later that sixty (60) days from the date of application; however, such requested effective date shall be the later of the following options:

If the producer forwards via U.S. mail a signed application to the Plan Administrator with a check payable to the Plan Administrator for the estimated annual or initial deposit premium, coverage will be bound at 12:01 a.m. on the day following the postmark on the envelope in which the application is mailed, including the estimated annual or deposit premium, or the expiration of existing coverage. If U.S. mail is used and/or there is no postmark, or if the application does not contain the required information as described in the Assigned Risk Supplement to the Basic Manual, provisions for securing a requested effective date as stated above and rules for binding coverage as stated in paragraph (I) below shall apply.

Subject to the review by the servicing carrier, employers which were formerly self-insured shall secure a requested effective date no later than 12:01 a.m. sixty (60) days following receipt by the Plan Administrator of a complete and eligible application.

In order to promote competition among servicing carriers and to improve the service thereof, the employer applying for initial coverage or renewal coverage within the Plan may strike up to a maximum of six (6) servicing carriers from the list of active-eligible servicing carriers then maintained by the Commissioner and the Plan Administrator as provided on the Appendix A to the application.

E. Application Review

Upon receipt of the application, the Plan Administrator shall review it for eligibility and completeness. The Plan Administrator may request additional information at its discretion to establish eligibility, to assign appropriate classification codes, to calculate applicable premium, and to otherwise appropriately process the application, Such information may include tax documentation, ownership information, contracts, or any other information deemed necessary to process the application. The employer and/or its representative shall provide this information/documentation, or provide an acceptable explanation for failure to provide the requested items within the timeframe established by the Plan Administrator.

Incomplete applications received by the Plan Administrator may, at the discretion of the Plan Administrator, be returned to the employer or its representative for completion or, with notice to the employer or its representative, may be retained by the Plan Administrator pending receipt of further information. Failure to comply in a timely manner with a request from the Plan Administrator may result in the rejection of the application.

F. Additional States Coverage

Except as indicated on the binder/verification page, all assignments under this Plan are to be made on an intrastate basis. However, any employer desiring insurance for operations in states other than those covered by its servicing carrier may request its servicing carrier to furnish insurance in the additional state in accordance with the Interstate Assignments section of this Plan. Plan policies affording coverage on operations in more than one (1) state must clearly indicate the premium developed for each state separately.

G. Premium Obligations

Assignments shall not knowingly be made under this Plan unless all undisputed workers' compensation premium obligations on any previous insurance have been met by the employer whether the obligation is to a servicing carrier or voluntary insurer.

H. Initial or Deposit Premium

After the application has been reviewed and eligibility has been determined, the Plan Administrator shall calculate the initial or deposit premium (depending on state payment options) and inform the employer, its representative, or the producer of the applicable premium, using the submission options identified by the Plan Administrator.

Note: See individual state Special Rules pages of the Basic Manual for Workers' Compensation and Employers' Liability Insurance for applicable initial or deposit premium rules.

I. Binding of Coverage

The producer or employer must submit the total required initial or deposit premium to the Plan Administrator, using one of the submission methods approved by the Plan Administrator. The required initial or deposit premium must be received within the timeframe established by the Plan Administrator in order for coverage to be bound on the requested effective date.

The effective date on the binder will be the secured effective date determined in the section entitled “Securing a Requested Effective Date” only if all of the following occur:

Coverage will not be bound by the Plan Administrator without a complete signed application and receipt of the appropriate deposit or initial premium.

J. Binder Information

The binder/verification page shall be sent to the insured, producer and servicing carrier and shall remain in effect until canceled or a policy has been issued. In accordance with Plan procedures, coverage shall not exist if a binder was not issued.

K. Reassignment

If the employer is dissatisfied with the servicing carrier, the employer may request reassignment to another insurer not less than thirty (30) days nor more than sixty (60) days prior to the expiration of the current policy unless otherwise approved by the Plan Administrator. The employer must submit a new application in accordance with the section entitled “Securing a Requested Effective Date.”

The employer must also provide the Plan Administrator with an acceptable reason or reasons for the request with appropriate documentation. The request for reassignment is subject to approval by the Plan Administrator and the reassignment shall be made on random basis.

L. Producer Information

M. Additional Coverages

Additional coverages may be available to the employer through the servicing carrier. See the WCIP Supplement printed at the end of the Plan for those coverages available in each state.

N. Policy Term

The policy shall be issued for a term of at least one (1) year, unless insurance for a shorter term has been requested. A short-term policy may be obtained only once within a twelve (12)-month period unless agreed to by the servicing carrier.