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Bill Number: 361 Ratification Number: 171 Act Number 123 Introducing Body: Senate Subject: Notice periods required to be given to the Budget and Control Board by a political subdivision before it can purchase or cancel its lines of insurance
(A123, R171, S361)
AN ACT TO AMEND SECTION 15-78-140, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE PURCHASE OF INSURANCE BY GOVERNMENTAL ENTITIES PURSUANT TO THE SOUTH CAROLINA TORT CLAIMS ACT, SO AS TO REVISE CERTAIN NOTICE PERIODS REQUIRED TO BE GIVEN TO THE BUDGET AND CONTROL BOARD BY A POLITICAL SUBDIVISION BEFORE IT CAN PURCHASE OR CANCEL ITS LINES OF INSURANCE WITH THE BOARD; AND TO AMEND SECTION 15-78-150, AS AMENDED, RELATING TO THE PURCHASE OF LIABILITY INSURANCE BY THE BUDGET AND CONTROL BOARD, SO AS TO PROVIDE THAT THE BOARD IN SETTING INSURANCE PREMIUMS FOR GOVERNMENTAL ENTITIES SHALL RATE THE POLICY ACCORDING TO THE RISKS INVOLVED WITH THE GENERAL CLASS OF THE INSURED ENTITY AND TO REQUIRE THE BUDGET AND CONTROL BOARD TO DEVELOP A CERTAIN ACTUARIAL RATING SYSTEM PLAN WHICH MUST BE IMPLEMENTED BY JULY 1, 1990.
Be it enacted by the General Assembly of the State of South Carolina:
Notice periods revised
SECTION 1. Section 15-78-140 of the 1976 Code, as amended by Act 463 of 1986, is further amended to read:
"Section 15-78-140. (a) It is the duty of the Budget and Control Board to cover risks for which immunity has been waived under the provisions of this chapter by the purchase of insurance as authorized in Section 15-78-150.
(b) The political subdivisions of this State, in regard to tort and automobile liability, property and casualty insurance shall procure insurance to cover these risks for which immunity has been waived by (1) the purchase of liability insurance pursuant to Section 1-11-140; or (2) the purchase of liability insurance from a private carrier; or (3) self-insurance; or (4) establishing pooled self-insurance liability funds, by intergovernmental agreement, which may not be construed as transacting the business of insurance or otherwise subject to state laws regulating insurance. A pooled self-insurance liability pool is authorized to purchase specific and aggregate excess insurance. A pooled self-insurance liability fund must provide liability coverage for all employees of a political subdivision applying for participation in the fund. If the insurance is obtained other than pursuant to Section 1-11-140, it must be obtained subject to the following conditions:
(1) If the political subdivision does not procure tort liability insurance pursuant to Section 1-11-140, it must also procure its automobile liability and property and casualty insurance from other sources and shall not procure these coverages through the Budget and Control Board;
(2) If a political subdivision procures its tort liability insurance, automobile liability insurance, or property and casualty insurance through the Budget and Control Board, all liability exposures of the political subdivision as well as its property and casualty insurance must be insured with the Budget and Control Board;
(3) If the political subdivision, at any time, procures its tort liability, automobile liability, property, or casualty insurance other than through the Budget and Control Board and then subsequently desires to obtain this coverage with the Budget and Control Board, notice of its intention to so obtain this subsequent coverage must be provided the Budget and Control Board at least ninety days prior to the beginning of the
coverage with the State Budget and Control Board.
The other lines of insurance that the political subdivision is required to procure from the board are not required to commence until the coverage for that line of insurance expires. Any political subdivision may cancel all lines of insurance with the State Budget and Control Board if it gives ninety days' notice to the board. The Budget and Control Board may negotiate the insurance coverage for any political subdivision separate from the insurance coverage for other insureds.
(4) If any political subdivision cancels its insurance with the Budget and Control Board, it is entitled to an appropriate refund of the premium, less reasonable administrative cost.
(c) For any claim filed under this act, the remedy provided in Section 15-78-120 is exclusive. The immunity of the State and its political subdivisions, with regard to the seizure, execution, or encumbrance of their properties is reaffirmed."
Setting premiums according to risks involved
SECTION 2. Section 15-78-150 of the 1976 Code, as amended by Act 463 of 1986, is further amended to read:
"Section 15-78-150. (a) The Budget and Control Board is authorized to purchase liability insurance.
(b) The purchase of insurance must be funded by participating governmental entities by payment of premiums as required by the Budget and Control Board. The Budget and Control Board in setting these premiums shall rate the policy according to the risk involved with the general class of insured entity. The Budget and Control Board must develop an actuarial rating system plan based upon the classification of employee and the risk involved by class of employee which must be implemented by July 1, 1990."
SECTION 3. This act takes effect upon approval by the Governor.