62-5-15. Perfected security interest in deposit--Release of security interest. Upon the secretary sending a request to renew, request to post, or request to increase a security deposit to the maximum amount permitted by §§ 62-5-10 to 62-5-16, inclusive, a perfected security interest is created in the private self-insured's assets in favor of the secretary to the extent of any then unsecured portion of the self-insured's incurred liabilities for workers' compensation claims. That perfected security interest is transferred to any cash or securities thereafter posted by the private self-insured with the state treasurer or other financial institution and is released only upon:
(1) The acceptance by the secretary of a surety bond, certificate of deposit, or irrevocable letter of credit for the full amount of the incurred liabilities for the payment of compensation; or
(2) The return of cash or securities by the secretary.
The private self-insured employer loses all right and title in and any right to control all assets or obligations posted or placed on deposit as security. In the event of a declaration of bankruptcy or insolvency by a court of competent jurisdiction the secretary may liquidate the deposit for application to the self-insured employer's incurred liability.
Source: SL 1989, ch 453, § 7; SL 2017, ch 219, § 2.
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