OhioBWC - Basics: (Policy library) - File

New Application (SI-6)


Policy Name:

Application to Pay Compensation Directly (SI-6)

Policy #:


Code/Rule Reference

Ohio Revised Code (ORC) 4123.35(B) & Ohio Administrative Code (OAC) 4123-19-03

Effective Date:



Winnie Warren, Interim Chief Employer Services


Self-Insured Department/Employer Services



Review Date:




I.      Policy Purpose


Employers who wish to be granted the privilege of self-insurance must meet specific financial and administrative requirements. This policy outlines the requirements to apply to become self-insured.


II.    Applicability


This 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.


III.   Definitions

A.    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.

B.    Self-Insuring Employer (SI Employer): An employer that has been granted the privilege of paying workers compensation and benefits directly.

C.   Self-Insured 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.

D.   State Fund Employer (SF Employer): A private employer (PA) or public employer (PE) that is insured through the State Insurance Fund for workers’ compensation.

IV.  Policy

A.    BWC will 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 commissioners;

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 matrix.

C.   Administrative Requirements:

1.    Provide organizational plan for administering the workers’ compensation program including where the official SI claim files will be housed;

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.

D.   Application Requirements:

1.    Initial Application for Authority to Pay Compensation Directly (SI-6);

2.    Permanent Authorization (AC-2) if applicable;

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 domestic parent);

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;

8.    Corporate organizational structure chart detailing the ultimate domestic parent and all subsidiaries with employees and payroll.

E.    Prior to final approval, BWC will be conducting an orientation to ensure the applicant is prepared for the responsibilities of an SI employer.

F.    If the 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.

G.   If the 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 SIINQ@bwc.state.oh.us.

V.    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.

Ohio Bureau of Workers’ Compensation

Self-Insured Department

30 W. Spring St., L-22

Columbus, Ohio 43215-2256

Email: SIINQ@bwc.state.oh.us

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.