102 STAT. 3706 PUBLIC LAW 100-647—NOV. 10, 1988

Subtitle D—Insurance Provisions

26 USC 801 note. SEC. 6076. TREATMENT OF CERTAIN WORKERS' COMPENSATION FUNDS.

(a) TREATMENT FOR TAXABLE YEARS BEGINNING BEFORE 1987.—In
the case of any taxable year beginning before January 1, 1987, a
deficiency shall not be assessed against (and if assessed, shall not be
collected from) any qualified group self-insurers' fund to the extent
such deficiency is attributable to the timing of policyholder dividend
deductions.

(b) QUALIFIED GROUP SELF-INSURERS' FUND.—For purposes of this
section, the term "qualified group self-insurers' fund" means any
group of 2 or more employers which has been in existence for not
less than 2 years, and who enter into agreements to pool their
liabilities under the State workers' disability compensation laws for
the purpose of qualifying as a self-insurer under such laws, if—

(1) the group has received a certificate of approval from, and
is subject to regulation by, the State board or agency that is
responsible for administering the State workers7 disability com-
pensation laws,

(2) each employer who is a member of the group, by written
agreement, is jointly and severally bound to assume and dis-
charge, by payment, any lawful judgment or award entered by a
court of competent jurisdiction or by the State agency respon-
sible for administering the State workers' disability compensa-
tion laws against a member of the group,

(3) the group is prohibited by State law or regulation from
using the monies collected for a purpose other than to pay, or to
reserve against, claims under the State workers1 disability com-
pensation laws and expenses,

(4) the group is prohibited by State law or regulation from
taking projected investment income into account in determining
members1 premiums,

(5) the group is required by State law or regulation to submit
to the State board or agency that is responsible for administer-
ing the State workers' disability compensation laws an audited
financial statement,

(6) the group's investments are limited by State law or regula-
tion to bonds, notes, or other evidences of indebtedness issued,
assumed or guaranteed by the United States of America, or by
an agency or instrumentality thereof, certificates of deposit in a
federally insured bank, shares or savings deposits in a federally
insured savings and loan association or credit union, and certifi-
cates of deposit issued by a commercial bank duly chartered
under State law, and other investments which are approved by
the State board or agency that is responsible for administering
the State workers' disability compensation laws, and

(7) the group exclusively covers workers' compensation liabil-
ity, is not a commercial insurance carrier or company licensed
by the State board, agency, or commissioner responsible for
regulating and licensing insurance carriers and companies; and
is not subject to filing under the regulatory statements of the
National Association of Insurance Commissioners.