What is the role of the master certificate of consent to self-insure in relation to deposits?

• A. It determines which subsidiaries are covered by deposits under the master certificate.
• B. It sets the interest rate for the deposits.
• C. It has no impact on deposits.
• D. It determines the premium rate for deposits.

Answer: (A)

The main idea here is that the master certificate of consent to self-insure defines the scope of who is covered by the deposits tied to a self‑insurance program. In California self‑insured workers’ compensation plans, employers may be required to post deposits to guarantee the plan’s obligations. The master certificate allows a parent company to authorize self‑insurance for multiple related entities and specifically designates which subsidiaries fall under that certificate. Those covered subsidiaries’ deposit requirements are then governed by the master certificate. The certificate doesn’t set interest rates or premium rates for deposits; those are separate financial terms. So its role is to identify which subsidiaries are included and thus whose deposits are under the master certificate.