Which fund pays benefits to injured workers when employers illegally fail to pay benefits?

• A. Self-Insurers Security Fund
• B. Uninsured Employers Fund
• C. State General Fund
• D. Private Insurance

Answer: (A)

When a self-insured employer cannot or will not pay workers’ compensation benefits, California’s Self-Insurers Security Fund steps in to make sure injured workers continue to receive the benefits they’re owed. This fund acts as a backstop for obligations that a self-insured employer would otherwise default on, and it helps maintain continuity of benefits while the underlying issue with the employer is resolved. The fund is funded by assessments related to self-insured entities, distinguishing it from other options.

The Uninsured Employers Fund, by contrast, handles situations where an employer had no workers’ compensation coverage at all, so workers would otherwise be left without benefits. The State General Fund is not a workers’ comp payment source, and private insurance is a coverage option, not a backstop fund. So for illegal nonpayment by a self-insured employer, the Self-Insurers Security Fund is the appropriate mechanism.