La. R.S. § 23:1404 Allocation of Surplus; Full Faith and Credit; Exemptions; Sunset

• Library: Louisiana Statutes
• Edition: 2023
• Currency: Current with changes from the 2023 Legislative Session
• Year: 2023
• Citation: La. R.S. § 23:1404

A. Any profit indicated on the annual financial statement of the corporation shall be allocated during the next accounting period as follows:

(1) No less than fifty percent of the profit shall be applied to liquidate any outstanding indebtedness of the corporation, until all such indebtedness has been liquidated.

(2) The remainder of the profit shall be used to establish and maintain surplus and reserve requirements as required for a domestic mutual insurer.

B.

(1)

(a)Should the corporation's assets be insufficient to pay claims as they become due, then the full faith and credit of the state of Louisiana shall be pledged for the purposes as provided in R.S. 23:1395 and for the payment of claims. This full faith and credit guarantee shall expire in five years or at such time as the United States Department of Labor approves United States Longshore and Harbor Worker's Compensation Act coverage by the corporation without such security, whichever occurs later.

(b) The corporation shall seek the approval of the United States Department of Labor to provide United States Longshore and Harbor Worker's Compensation coverage upon obtaining an A.M. Best rating of "A-" or better. Beginning no later than five years after the issuance of its first policy, the corporation shall make diligent efforts to obtain an A.M. Best rating of "A-" or better.

(c) The extinguishment of the full faith and credit guarantee shall be self-executing immediately upon the United States Department of Labor's approval. The provisions of this Part affected by extinguishment of the full faith and credit guarantee shall also be immediately self-executing.