State Compensation Insurance Fund Will Disburse $50M in Credits
The State Compensation Insurance Fund -- a provider of workers' compensation insurance -- has announced that it will issue a $50 million dividend to qualified policyholders next year and that it plans to provide up to $50 million in severance packages for state workers who leave voluntarily by the end of this year, the Sacramento Bee reports (Ortiz, Sacramento Bee, 11/19).
Details of Dividend
According to the fund, the dividend will be issued becauseÂ the fundÂ has "adequate surplus, and is making good progress on its expense management and underwriting discipline." It is the first dividend the fund has issued since 2001.
The dividend will be issued as a premium credit applied to the 2012 policy year to policyholders who:
- Finalize their 2011 audit bill within six months of expiration;
- Have paid premiums on time and kept their policy in "good standing"; and
- Renew their policy in 2012 and keep making accurate payments.
The dividend is about 5.2% of the estimated annual premium for 2011Â (Johnson, Sacramento Business Journal, 11/18).
Details of Severance Deal
Meanwhile, through a deal reached with the Service Employees International Union Local 1000, the fund is preparing to pay out as much as $50 million in severance packages for state workers who volunteer to leave by the end of 2011.
Depending on their job, salary and service time, as many as 1,800 state employees who could be laid off next year could receive between $17,000 and $55,000 if they leave by Dec. 31.
According to the agreement, employees with at least seven years of State Fund service would receive six months of salary plus $9,000 for health care and other benefits. Employees with less than seven years of service would receive a payment that equals four months of salary plus $6,000 for benefits lost.
The Department of Personnel Administration must approve the plan (Sacramento Bee, 11/19).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.