IR #2010-29
October 12, 2010

Erika Monterroza
Dean Fryer


DIR Moves to Strengthen Regulations Governing Self Insurance Plans and Increase Oversight of Self Insured Groups

Sacramento—The Department of Industrial Relations’ Office of Self Insurance Plans (DIR/SIP) today posted a notice of rulemaking for a regulations package that includes changes to increase oversight of Self Insured Groups (SIGs).  The proposed amendments would also require self-insured employers, or their claims administrators, to adopt the same reporting of medical cost containment program expenses as the workers’ compensation insurance carriers.

“California’s regulation of SIGs remains the most stringent in the entire nation,” said DIR Director and SIP Administrator John C. Duncan. “These regulation changes will provide additional reporting requirements for SIGs, shorten reporting timeframes and allow our office more opportunities to monitor and verify groups’ historical as well as prospective reports. The increased oversight will provide the SIG’s Board of Trustees, members and our office with more complete and timely information.”

The proposed rulemaking package includes regulatory changes that will:

The notices of rulemaking will be mailed out today to SIP’s mailing list, and has been posted electronically. A copy of SIP’s notice of rulemaking and statement of reasons is available

As the office responsible for certification of self insurers’ administrators, SIP recently took disciplinary action and revoked the certificates of four administrators. The four were named as co-conspirators in a workers’ compensation insurance embezzlement scam and pled guilty earlier this year to charges ranging from grand theft, conspiracy to commit fraud, filing false insurance claims and tax evasion. The California Department of Insurance and Orange County District Attorney’s office worked together for months on this case of white collar crime. The revocation by SIP permanently prohibits them from administering self insurance plans. 

Self Insurance Plans (SIP), a program within the director’s office of the Department of Industrial Relations (DIR), authorizes qualified employers to provide their own coverage for workers’ compensation liabilities. The director of Industrial Relations is responsible for certification of public and private self insured employers, third-party administrative agencies that oversee self insurance programs, and individual claims adjusters. For more information or comments on self insurance, please refer to SIP’s website at   

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