Minnesota Administrative Rules

2770.6500 AUTHORIZATION STANDARDS.

Subpart 1.

Political subdivisions.

The commissioner shall grant self-insurance authority to an applicant that is a political subdivision if it satisfies these conditions:

A.

at least 25 motor vehicles are registered in its name; and

B.

it has, or has contracted with a licensed vendor of risk management services to provide, the administrative resources needed to:

(1)

process, review, and pay claims;

(2)

evaluate the medical and rehabilitation needs of automobile accident victims; and

(3)

estimate current and future loss liabilities.

A political subdivision that has satisfied the foregoing conditions is not required to satisfy the security requirement of part 2770.6800.

Subp. 2.

All other applicants.

The commissioner shall grant self-insurance authority to an applicant that is not a political subdivision if the following conditions are satisfied:

A.

the applicant satisfies subpart 1, item B;

B.

either the applicant alone or the parent company alone:

(1)

satisfies subpart 1, item A;

(2)

has existed for at least five years;

(3)

has a current net worth, or the equivalent, of at least $5,000,000;

(4)

had positive net income, or the equivalent, during the last five-year period and in at least three of those years; and

(5)

had positive net funds flow during the last five-year period and in at least three of those years;

C.

neither the applicant nor its parent company, if one exists, has sought protection under the United States Bankruptcy Code during the last three years; and

D.

the funds flow, debt structure, profitability, and overall financial integrity of the applicant and its parent company, if one exists, demonstrate a continuing ability of the applicant to satisfy any financial obligations that have been and might be incurred under the no-fault act.

Statutory Authority:

MS s 65B.48

History:

9 SR 734; 9 SR 764; 10 SR 1265

Published Electronically:

September 14, 2007