Chapter 41 - State Self-insurance Program
CHAPTER 41 - STATE SELF-INSURANCE PROGRAM
1-41-101. Legislative findings and intent.
Thelegislature recognizes that certain liability insurance policies of the stateof Wyoming have been cancelled, that no responsive bids have been received andthat there exists a need to develop a method to handle claims brought under theWyoming Governmental Claims Act and arising under federal law. The legislaturedeclares that the appropriate remedy is to create an account for self-insuranceof the state and to provide for a loss prevention program. It is the intent ofthe legislature that the self-insurance account shall be operated on anactuarially sound basis. The legislature further declares that its intent isthat the availability of commercial liability insurance coverage shall beexplored considering the possibility that the insurance industry can providecoverage in the future that is less expensive than the costs of providing aloss prevention program and paying for claims out of the self-insuranceaccount.
1-41-102. Definitions.
(a) As used in this act:
(i) "Division" means the general services division ofthe department of administration and information;
(ii) "Final money judgment" means any judgment formonetary damages after all appropriate appeals from the judgment have beenexhausted or after the time has expired when appeals may be taken;
(iii) "Local government" means as defined by W.S.1-39-103(a)(ii);
(iv) "Peace officer" means as defined by W.S. 7-2-101,but does not include those officers defined by W.S. 7-2-101(a)(iv)(K) or thoseofficers defined by W.S. 7-2-101(a)(iv)(M) unless otherwise provided in theapplicable mutual aid agreement;
(v) "Public employee" means any officer, employee orservant of the state, provided the term:
(A) Includes elected or appointed officials, peace officers,members of regional emergency response teams authorized under W.S. 35-9-155 andpersons acting on behalf or in service of the state in any official capacity,whether with or without compensation, including volunteer physicians providingmedical services under W.S. 9-2-103(a)(i)(C);
(B) Does not include:
(I) An independent contractor except as provided insubparagraph (C) of this paragraph;
(II) A judicial officer exercising the authority vested in him;or
(III) Any local government employees or officials includingcounty and prosecuting attorneys.
(C) Includes contract physicians, physician assistants, nurses,optometrists or dentists in the course of providing contract services for stateinstitutions.
(vi) "Risk manager" means the manager of the riskmanagement section of the general services division of the department ofadministration and information;
(vii) "Scope of duties" means performing any dutieswhich the state requests, requires or authorizes a public employee to perform,or which the University of Wyoming or a local government requests, requires orauthorizes a peace officer to perform, regardless of the time and place ofperformance;
(viii) "State" or "state agency" means thestate of Wyoming or any of its branches, agencies, departments, boards,instrumentalities or institutions but does not include the University ofWyoming except as provided by W.S. 1-41-110(b);
(ix) "Self-insurance account" or "account"means the account created by W.S. 1-41-103;
(x) "This act" means W.S. 1-41-101 through 1-41-111.
1-41-103. Self-insurance account; creation; authorized payments.
(a) There is created the state self-insurance account. The accountshall be in such amount as the legislature determines to be reasonablysufficient to meet anticipated claims. In addition to any legislativeappropriation, the account shall include all authorized transfers of monies tothe account, all income from investments of monies in the account and paymentsby insurance or reinsurance companies. The account may be divided intosubaccounts for purposes of administrative management. Appropriations to theaccount shall not lapse at the end of any fiscal period.
(b) The self-insurance account shall maintain sufficientreserves for incurred but unpaid claims as well as incurred but unreportedclaims.
(c) Expenditures shall be made out of the self-insuranceaccount for the following claims which have been settled or reduced to finaljudgment:
(i) Claims brought against the state or its public employeesunder the Wyoming Governmental Claims Act, provided any amount up to twothousand five hundred dollars ($2,500.00) paid for or in defense of each claiminvolving an automobile, physical damage, a settlement or adverse judgmentshall be reimbursed to the self-insurance account by the state agency, from itsexisting budget, against which the claim is brought or which employs the publicemployee against whom the claim is brought;
(ii) Claims against the state or its public employees, or astate judicial officer exercising the authority vested in him, arising under 42U.S.C. 1983 or other federal statutes, which the state has obligated itself topay under subsection (e) of this section, provided any amount up to twothousand five hundred dollars ($2,500.00) paid for or in defense of each claimresulting in settlement or adverse judgment shall be reimbursed to theself-insurance account by the state agency, from its existing budget, againstwhich the claim is brought or which employs the public employee against whomthe claim is brought;
(iii) Claims against a peace officer employed by the Wyomingstate board of outfitters and professional guides, the University of Wyoming ora local government brought under the Wyoming Governmental Claims Act, provided:
(A) The act or omission upon which the claim is based has beendetermined by a court or jury to be within the peace officer's scope of duties;
(B) The indemnification for the judgment shall not exceed thelimits provided by W.S. 1-39-118;
(C) Any amount up to twenty thousand dollars ($20,000.00) paidfor or in defense of each claim shall be paid on a dollar for dollar matchingbasis from the account and from the University of Wyoming or the localgovernment employing the peace officers; and
(D) Any amount up to twenty thousand dollars ($20,000.00) paidfor or in defense of each claim against a peace officer employed by the Wyomingstate board of outfitters and professional guides shall be paid by the board.
(iv) Claims against a peace officer employed by the Wyomingstate board of outfitters and professional guides, the University of Wyoming ora local government arising under 42 U.S.C. 1983 or other federal statutes,provided:
(A) Any amount up to twenty thousand dollars ($20,000.00) paidfrom the account for or in defense of each claim shall be paid on a dollar fordollar matching basis from the account and from the University of Wyoming orthe local government employing the peace officer;
(B) Any amount up to twenty thousand dollars ($20,000.00) paidfor or in defense of each claim against a peace officer employed by the Wyomingstate board of outfitters and professional guides shall be paid by the board;and
(C) The conditions and limitations of subsection (e) of thissection apply to all claims under this paragraph.
(v) Claims against contract physicians, physician assistants,nurses, optometrists or dentists brought under the Wyoming Governmental ClaimsAct or federal law, provided:
(A) The contract physician, physician assistant, nurse,optometrist or dentist is unable to procure medical malpractice insurancecoverage up to the limits specified in W.S. 1-39-110(b) or 1-39-118(a) as applicable;
(B) The liability of the state shall not exceed limitsspecified in W.S. 1-39-118(a) except as the limitation may be increased by W.S.1-39-110(b) both reduced by the amount of the contract physician's, physicianassistant's, nurse's, optometrist's or dentist's malpractice insurance coverageapplicable to such claim; and
(C) The claim arises from services performed by the contractphysician, physician assistant, nurse, optometrist or dentist for a stateinstitution.
(d) Expenditures may also be made out of the self-insuranceaccount for:
(i) Expenses related to claims under subsection (c) of thissection;
(ii) Costs of purchasing services, including loss prevention,risk and claims control, and legal, actuarial, investigative, support andadjustment services; and
(iii) Costs of insurance or reinsurance premiums consistent withmarket availability;
(iv) Administrative expenses incurred by the division under thisact including the cost of necessary personnel within the office of the attorneygeneral, as may be mutually agreed upon by the risk manager and the attorneygeneral, to handle claims arising under this act.
(e) The state shall defend claims against its public employees,or a state judicial officer exercising the authority vested in him, arisingunder 42 U.S.C. 1983 or other federal statutes, subject to the followingconditions:
(i) The state shall defend and, to the extent provided byparagraph (v) of this subsection, indemnify any of its public employees againstany claim or demand, whether groundless or otherwise, arising out of an allegedact or omission occurring in the scope of duty;
(ii) Repealed by Laws 1988, ch. 50, 2.
(iii) If any civil action, suit or proceeding is brought againstany public employee of the state which on its face falls within the provisionsof paragraph (i) of this subsection, or which the public employee asserts to bebased in fact upon an alleged act or omission in the scope of duty, the stateshall appear and defend the public employee under an automatic reservation ofright by the state to reject the claim unless the act or omission is determinedto be within the scope of duty;
(iv) Any public employee of the state against whom a claimwithin the scope of this subsection is made shall cooperate fully with thestate in the defense of the claim. If the state determines that the publicemployee has not cooperated or has otherwise acted to prejudice defense of theclaim, the state may at any time reject the defense of the claim;
(v) Unless the act or omission upon which a claim is based isdetermined by the court or jury to be within the public employee's scope ofduty, no public funds shall be expended in payment of the final judgmentagainst the public employee;
(vi) Nothing in this subsection shall be deemed to:
(A) Increase the limits of liability under W.S. 1-39-118 forclaims brought under the Wyoming Governmental Claims Act;
(B) Affect the liability of the state itself or of any of itspublic employees on any claim arising out of the same accident or occurrence;or
(C) Waive the protection of the state or its public employeesfrom liability where immunity has not been specifically waived.
1-41-104. Investment of funds.
(a) Repealed by Laws 1988, ch. 82, 2.
(b) The state treasurer shall invest any portion of the fundsin the self-insurance account, including reserves, which the risk managerdetermines is not needed for immediate use. Investments shall be made asauthorized by W.S. 9-4-715(a), (d) and (e).
1-41-105. Powers and duties of risk manager.
(a) Except as otherwise provided in subsection (b) of thissection, the risk manager shall:
(i) Administer the self-insurance account;
(ii) Implement and administer a loss prevention program for thepurpose of reducing risks, accidents and losses;
(iii) Administer, supervise and manage the investigation andadjustment and settlement of claims covered by this act, including subrogationand restitution claims filed on behalf of the state self-insurance account;
(iv) Provide legal services for the defense of claims covered bythis act through the attorney general or through private attorneys approved bythe attorney general;
(v) Approve and supervise persons who may contract with thestate to provide services;
(vi) Procure insurance, including comprehensive professionalliability coverage for all peace officers, consistent with market availability;
(vii) Prepare a budget based upon economically and actuariallysound principles, which will maintain a reasonable and adequate surplus to meetestimated payments for contracts, services, claims and expenses;
(viii) Purchase loss prevention, actuarial and other professionalservices as required; and
(ix) Adopt rules governing the administration of the state'sself-insurance account and loss prevention program and to carry out thepurposes of this act.
(b) If the risk manager determines it is economically feasiblehe may contract with any private firm or firms to provide any administrative orother services deemed necessary under this act.
1-41-106. Compromise or settlement of claims; authority; primaryinsurance coverage.
(a) Any claim covered under this act may be compromised orsettled according to the requirements in subsection (b) of this section. Insettling a claim, the risk manager may require the execution and presentationof those documents required by rule and regulation including those documentswhich discharge or hold harmless the state, local government or public employeeof all liability under the claim.
(b) The following parties are authorized to make compromises orsettlements of claims in the following amounts:
(i) Repealed By Laws 1999, ch. 100, 2.
(ii) The risk manager is authorized to settle claims for anamount not to exceed fifty thousand dollars ($50,000.00);
(iii) The risk manager, after consultation with the attorneygeneral, is authorized to settle claims for an amount not to exceed one hundredthousand dollars ($100,000.00); and
(iv) The governor is authorized to settle claims for any amountif the action arises under federal law. The governor is authorized to settleclaims brought under the Wyoming Governmental Claims Act for any amount not toexceed the maximum liability limits under the Wyoming Governmental Claims Act.
(c) The provisions of the Wyoming Administrative Procedure Actare not applicable to the payment or settlement of claims. Any person or partyadversely affected in compromising or settling a claim shall pursue his remedyin district court pursuant to the Wyoming Rules of Civil Procedure.
(d) The risk manager and the state have no liability, and nocause of action exists against either the risk manager or the state, forfailure to settle a claim.
(e) Except with respect to volunteer physicians providingmedical services under W.S. 9-2-103(a)(i)(C), an expenditure may be made out ofthe state self-insurance account for settlement or payment of any claim whichis covered by liability insurance only to the extent any other liability insuranceis not sufficient to satisfy the claim. Except with respect to volunteerphysicians providing medical services under W.S. 9-2-103(a)(i)(C), any otherliability insurance shall be considered as the primary coverage. Nothing inthis section shall be deemed an increase in the limits of liability under W.S.1-39-110 or 1-39-118(a).
1-41-107. Reports.
(a) The division shall make an annual report to the governorand the legislature. The report shall include:
(i) The total number of claims filed against the state andpeace officers covered under this act;
(ii) The number and amount of claims settled;
(iii) The cost of legal fees and adjustors' fees for the handlingof claims;
(iv) The number and amount of final judgments paid;
(v) The number of claims pending and the reserves set aside foreach pending claim;
(vi) The types and cost of insurance coverages procured asauthorized under this act.
1-41-108. Self-insurance program not subject to insurance laws.
Nothing in this act shall be construed ascreating an insurance company nor in any way subjecting the self-insuranceaccount to the laws of the state regulating insurance or insurance companies.
1-41-109. Confidential information.
The claim files maintained by the riskmanager shall be considered privileged and confidential and shall be for theuse of the risk manager and the insurance commissioner only.
1-41-110. Applicability.
(a) This act applies to claims based upon acts, errors oromissions occurring on and after October 1, 1985.
(b) This act applies to claims against peace officers employedby the University of Wyoming but does not apply to other claims against theUniversity of Wyoming unless the university notifies the risk manager inwriting on or before August 15 that it elects to be covered by this act for theperiod beginning July 1 of the succeeding fiscal year. If the University ofWyoming elects to be covered by this act, it shall continue the coverage fornot less than three (3) years from the date the coverage begins.
1-41-111. No extension of liability.
Self-insurance provided under this actshall not be considered a purchase of insurance coverage and shall not bedeemed an increase of the limits of liability under W.S. 1-39-118(b).