58-20-28. Requirements to obtain self-insurance certificate.To obtain and maintain its certificate an association shall:(1)Have sufficient assets, net worth, and liquidity to promptly meet all obligations of the association's members under §§58-20-25 to 58-20-40, inclusive, and their workers' compensation liability. In determining whether an association is in sound financial condition, consideration shall be given to the combined net worth of the member companies; the combined long-term and short-term debt to equity ratios of the member companies; other financial data requested by the department or submitted by the group; and the combined workers' compensation experience of the group for the last three years;(2)Furnish to the department security in the form of a bond, cash, certificate of deposit, government securities, irrevocable letter of credit, irrevocable trust, in any combination, in an amount equal to the greater of:(a)Two hundred fifty thousand dollars; or(b)Twenty-five percent of the association's preceding year's gross annual assessments to its members;(3)Obtain specific and aggregate excess insurance by an insurance company licensed to conduct business in South Dakota; t of the association's preceding year's gross annual assessments to its members;(3)Obtain specific and aggregate excess insurance by an insurance company licensed to conduct business in South Dakota; and(4)Maintain an indemnity agreement jointly and severally binding the association and each member of the association to meet the workers' compensation liability of each member. Source: SL 1995, ch 282, §4.
South Dakota Legal Code