Deductible programs

The organization and an employer may contract for a deductible program. When a deductible program contract is entered, the employer shall reimburse the organization for benefits payable on individual claims up to the agreed deductible amount. The organization shall provide a reduced premium to participating employers based on an actuarial analysis of the contracted deductible and the rate classification of the employer. For purposes of calculating premiums, the experience rate utilized will exclude actual and expected primary losses. For an additional premium, the organization may provide aggregate excess coverage limiting the maximum liability for losses of the employer during a policy period. Premiums will be derived from actuarial analysis and a selected aggregate limit. The aggregate limit will be agreed upon by the employer and the organization. 1. Eligibility. Eligibility for participation in a deductible program is based on the financial stability and resources of the employer. Participating employers must be in good standing with the organization. The organization may require participating employers to submit to a financial audit to ensure financial stability. The audit may include a credit check and review of company financial reports. The organization shall analyze each proposed contract based on risk analysis and sound business practices. The organization may refuse any deductible program if it determines that the proposed contract does not represent a sound business practice or decision. Past participation in a deductible program does not guarantee continued eligibility. The organization may decline renewal of any deductible program. 2. Claim payment. The organization shall process and pay claims in accordance with North Dakota Century Code title 65. The employer shall reimburse the organization for all costs paid by the organization on individual claims up to the amount of the contractually agreed deductible. If a third-party recovery on a claim is made, the recovery will be allocated according to the terms of the contractual agreement between the organization and the employer, subject to North Dakota Century Code section 65-04-19.3. The organization shall deduct any delinquent deductible reimbursements from any subrogation amounts recovered on any claim. 3. Premium payment. Premium is due at policy inception pursuant to the terms of the contractual agreement between the organization and the employer. 4. Financial security. The organization may require an employer to provide a bond, letter of credit, or other security approved by the organization to guarantee payment of future employer obligations incurred by a deductible contract.