Pay Compensation Directly (SI-6)
Ohio Revised Code (ORC) 4123.35(B)
& Ohio Administrative Code (OAC) 4123-19-03
Warren, Interim Chief Employer Services
Self-Insured Department/Employer Services
I. Policy Purpose
Employers who wish
to be granted the privilege of self-insurance must meet specific financial and
This policy outlines the requirements to apply to
policy applies to applicants for SI status. This includes State Fund Employers
(private and public), out-of-state employers, and subsidiaries of Self-Insured employers.
Designated Ohio Administrator: An employee of the SI employer
applicant who has one or more years of experience as a workers’ compensation
administrator for a SI employer in Ohio.
Employer (SI Employer): An employer that has been granted the privilege of
paying workers compensation and benefits
Review Panel (SIRP): A panel of
three (3) persons appointed by the BWC administrator to provide employers with
hearings on matters referred to the panel, or as requested by the employer.
Fund Employer (SF Employer): A private employer (PA) or public employer (PE) that is insured through
the State Insurance Fund
for workers’ compensation.
consider the factors outlined in ORC 4123.35(B) when evaluating private and public
employers’ qualifications for self-insurance. ORC 4123.35(B)(1) provides criteria for private
employers and ORC 4123.35(B)(2) provides criteria for public
employers. The applicant must demonstrate the ability to meet all financial
and administrative requirements.
B. Financial Requirements:
1. Private employers;
a. must provide five (5) years of Generally Accepted Accounting Principles (GAAP) audited
financial statements which will be used to evaluate the applicant’s financial
strength and ability to meet the financial requirements of self-insurance
without the need for additional security;
b. must ensure financial records
include the balance sheets and a profit and loss history for the last five (5) years; be
audited by a certified public accountant (CPA) in accordance with GAAP; and
include a CPA’s audit opinion;
c. must be aware BWC may utilize a
credit reporting service that offers financial and other business information
about individual employers.
2. Public employers;
a. must provide the previous five annual audits completed
by the Auditor of the State, or County Auditor for a board of county
b. must submit five (5) years
audited financial statements if a public hospital;
c. must ensure the audited financial statements are
prepared in accordance with GAAP or other comprehensive basis of accounting as
permitted in Ohio
Auditor of State bulletin 2005-002.
3. The self-insured department will not approve an
application if the financial review determines additional security is required
based on the securitization
C. Administrative Requirements:
1. Provide organizational plan for administering the workers’
compensation program including where the official SI claim files will be
2. Provide proposed
plan to inform employees of the change from the state fund to self-insurance;
3. Provide Medical Management Plan;
4. Provide the
name and years of experience of the applicant’s employee that will be the
designated Ohio administrator.
1. Initial Application for Authority to Pay Compensation
2. Permanent Authorization
3. Election to Withdraw
from Claims Reimbursement Fund (SI-44) if you
choose to opt out;
4. Unconditional and Continuing
Guarantee (SI-38) (from the ultimate
5. Agreement between Employer and
the Ohio Bureau of Workers’ Compensation Regarding Amount of SI Buyout (SI-16);
6. Private employer: Ohio Secretary of State Certificate of Good Standing;
7. Public Employer: Appropriate State certified charter;
organizational structure chart detailing the ultimate domestic parent and all
subsidiaries with employees and payroll.
Prior to final approval, BWC will be conducting an orientation to ensure the applicant
is prepared for the responsibilities of an SI employer.
application is approved, BWC will notify the applicant in writing of the
decision and the effective starting date for the policy will be determined in
conjunction with the SI Department.
application is denied, BWC will notify the applicant in writing of the decision
and the employer will have fourteen (14) days from receipt to appeal the
decision. All appeals are to be in writing and submitted electronically via the
SI Inquiries email box at firstname.lastname@example.org.
Resolution of Complaints
A. Any complaints or disputes related to this policy must be submitted in writing to the SI
Department via mail or email as detailed
in the Self-Insured
Employer Dispute/Protest Policy.
Bureau of Workers’ Compensation
W. Spring St., L-22
B. If the SI employer disagrees with the SI
Department’s formal written response, the SI employer may file a written
request to appeal
the decision to the SIRP.