Which of the following is an obligation of former self-insurers?

• A. Maintain a payroll
• B. Deposit or maintain a security deposit
• C. Invest in securities
• D. None of the above

Answer: (B)

The essential point is that security deposits backstop a self-insurer’s obligations. Even after a company stops self-insuring, it must continue to deposit or maintain a security deposit because there may be outstanding or future workers’ compensation liabilities tied to its prior self-insurance period. That deposit, held by the regulatory authority, guarantees funds are available to pay claims if needed and can be released only when all liabilities are resolved and the status is properly closed. The other options aren’t regulatory duties tied to former self-insurers: payroll levels aren’t a continuing obligation of this status, and investing in securities isn’t the required obligation here. Therefore, maintaining or depositing the security deposit is the correct duty.