Magnifying Glass
Back to Sponsored Content

CA State Fund Board Opposes Proposed Sale Of Assets

13 Jul, 2009 WorkersCompensation.com

                               
Sacramento, CA (CompNewsNetwork) - Due to the severe nature of California's budget crisis, policy leaders are understandably considering everything as they try to produce a balanced budget. The sale of all or a part of State Fund's assets is one of the many suggestions that have been made. This suggestion was included in the May budget revise, which is done each May after tax receipts have been tallied, and proposes suggests that State Fund retain its role as a guaranteed provider of workers' compensation, but that a portion of State Fund's assets would be sold to a private insurer with the proceeds (estimated at $1 billion) going to California's general fund.

Historical Precedents
The idea of either selling or privatizing State Fund has been suggested at various points in history. In the past these proposals have always been dropped after considering the legal challenges as well as the risks to the market and economy. While there's no guarantee the outcome this time will be similar, the risks have not changed and in fact may be greater given the recession.

Another important historical precedent is State Fund's role as a viable and affordable option when market conditions worsen and private insurance companies scale back their product offerings. The board experienced this in 2000-2002 when 28 private carriers claimed insolvency and left the California market. At that time State Fund stepped up to fulfill its leadership role as a critical safety net for the market by providing coverage for most of those policyholders and prevented a workers' comp market collapse and the drain on the state's economy that would have resulted.

Analysis
It's important to understand that the current proposal is structured as a study of the idea of selling all or part of State Fund's assets. This proposal requires substantial and thoughtful analysis not only because of the complexity of issues but also because the stakes are so high. Clearly if this were to occur it would be a lengthy proposition and not one that would happen quickly.

Commitment
As State Fund move through this process, it remains committed to serving all California businesses. Millions of Californians rely on the security and certainty State Fund offer the state's employers, particularly the small businesses and new ventures that are keys to California's economic recovery. State Fund is obligated and well-positioned to provide stability, affordability, and availability to California's historically volatile workers' compensation market.  Without it, many employers—particularly small businesses and start ups—would simply not be able to obtain or afford workers' compensation insurance.

    • Read Also

    IOH Announces Appointment of Scott Strickland as Chief Operating Officer (COO) 

    SAN DIEGO, CA — July 1, 2024 — Institutes of Health (“IOH”), a leading transdisciplinary Workers’ Compensation treatment organization focused on patients suffering from complex and chronic conditions, is delighted to announce the appointment of […]
    Rising Medical Solutions Becomes Bronze Associate Partner of WorkCompCollege.com 

    Lakewood Ranch, FL (July 2, 2024) – WorkCompCollege.com, a division of Workers’ Compensation Educational Services, LLC, has announced a Bronze Associate Partnership with Rising Medical Solutions (Rising). Their mission to “make lives better” is consistent […]
    The Key Role of a Workers’ Comp Case Manager 

    Close attention through the claim lifecycle ensures the best claimant outcomes   In the world of workers’ compensation, where endless variables seem to be at play, Horizon Casualty Services, Inc., (HCS) acknowledges that having a clear […]

    About The Author

    • WorkersCompensation.com

    More by This Author

    Ametros’ Melissa Coleman Honored by the IAIABC as a 2024 NextGen Winner

    Wilmington, Mass. (June 24, 2024) – The IAIABC has recognized Melissa Coleman as a 2024 NextGen Award Winner. Coleman is the Senior Vice President of Marketing for Ametros, which helps people manage their medical funds following workers’ […]
    ReEmployAbility Announces Free Webinar: ‘Overcoming Jurisdictional Return-to-Work Challenges’

    ReEmployAbility, Inc.Contact: Rebecca Dearth(813) 261-3117 | news@reemployability.com Brandon, FL (May 10, 2023)- ReEmployAbility CEO and Founder Debra Livingston will be hosting a second free, live Work Comp Central webinar in their continued series to educate […]
    NCCI Annual Golf Event Tees Up $25,000 for Kids’ Chance of America

    (Orlando, FL–May 10, 2023)—The National Council on Compensation Insurance (NCCI) has given $25,000 to Kids’ Chance of America, supporting college scholarships for the children of injured workers. NCCI made the donation in conjunction with its Annual […]

    Read More

    IOH Announces Appointment of Scott Strickland as Chief Operating Officer (COO) 

    SAN DIEGO, CA — July 1, 2024 — Institutes of Health (“IOH”), a leading transdisciplinary Workers’ Compensation treatment organization focused on patients suffering from complex and chronic conditions, is delighted to announce the appointment of […]
    Rising Medical Solutions Becomes Bronze Associate Partner of WorkCompCollege.com 

    Lakewood Ranch, FL (July 2, 2024) – WorkCompCollege.com, a division of Workers’ Compensation Educational Services, LLC, has announced a Bronze Associate Partnership with Rising Medical Solutions (Rising). Their mission to “make lives better” is consistent […]
    The Key Role of a Workers’ Comp Case Manager 

    Close attention through the claim lifecycle ensures the best claimant outcomes   In the world of workers’ compensation, where endless variables seem to be at play, Horizon Casualty Services, Inc., (HCS) acknowledges that having a clear […]
    Ametros’ Melissa Coleman Honored by the IAIABC as a 2024 NextGen Winner

    Wilmington, Mass. (June 24, 2024) – The IAIABC has recognized Melissa Coleman as a 2024 NextGen Award Winner. Coleman is the Senior Vice President of Marketing for Ametros, which helps people manage their medical funds following workers’ […]
    PhysNet Achieves Fifth Consecutive Year of SOC 2 Type II Certification

    Jacksonville, FL, June 3, 2024 – PhysNet proudly announces its attainment of SOC 2 Type II compliance for the fifth consecutive year, reinforcing its commitment to providing enterprise-level security for customer data within its cloud-based […]
    WorkCompCollege.com Welcomes Alistair Ienstein as New Academic Innovator 

    June 20, 2024 – WorkCompCollege.com is thrilled to announce the appointment of Alistair Ienstein as its new Academic Innovator. Alistair, a unique and revolutionary AI presence, is poised to transform the learning experience for students […]

    Request a Demo

    To request a free demo of one of our products, please fill in this form. Our sales team will get back to you shortly.