Group Trust Self-Insurance

A self-insurance group trust is a method by which small - to medium - sized employers can pool their workers’ compensation liability with other employers. The group trust is the collective assumption of risk by a group of employers usually within the same industry or members of the same association.

What is a Self-Insurance Group Trust?
Self-Insured Employers: Responsible for Paying SIF Surcharge
Self-Insured Employers: Responsible for Paying WC Tax
Advantages of a Self-Insurance Group Trust
Disadvantages of a Self-Insurance Group Trust
Regulatory Requirements
Forming a New Group Trust
How Do I Become a Member of an Existing Group Trust?
How do I obtain a listing of the Group Trusts?
Reporting Requirements
Will I be Subject to Audits?
Group Self-Insurance Frequently Asked Questions

2013 Workers' Compensation Tax and Surcharge Rates
2012/2013 State Average Weekly Wage and Maximums

What is a Self-Insurance Group Trust?

A self-insurance group trust is a method by which small - to medium - sized employers can pool their workers’ compensation liability with other employers.

The group trust is the joint and several assumption of risk by a group of employers usually within the same industry or members of the same association. Employers spread out their workers’ compensation risk among all the members of the group trust. Each member pays a premium to the group trust. All losses and expenses for the group trust are paid from the collected premiums. If the losses and expenses exceed the collected premium, then each member will be required to make additional contributions. However, each member may receive a surplus distribution if the losses and expenses for the group trust are less than the collected premium.

The success and proper functioning of a self-insurance group trust comes from its members’ commitment to reducing work place accidents and the efficient administration of its claims and general operations.

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Self-Insured Employers: Responsible for Paying SIF Surcharge

The Second Injury Fund (SIF) is funded through a surcharge on employers’ workers’ compensation net deposits, net premiums or net assessments and net premium equivalent for individual self-insured employers. Each year by October 31, the Director of the Division of Workers’ Compensation estimates the benefits payable from the Second Injury Fund during the following calendar year in order to set the surcharge rate. The rate is based on a statutory formula to generate 110% of the moneys to be paid from the Second Injury Fund in the following calendar year less any moneys contained in the fund at the end of the previous calendar year. The rate has been capped at 3 percent.

The surcharge is collected quarterly from insurance companies and self insurers. In order to satisfy your obligation under Section 287.715 RSMo, employers/group trusts that have been authorized to self-insure in Missouri need to register with the SIF Surcharge Unit by sending us an e-mail at SIFsurcharge@labor.mo.gov or by calling us at 573-526-5756.

Read more about how to pay your surcharge

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Self-Insured Employers: Responsible for WC Tax

The Division of Workers’ Compensation is funded through the Workers’ Compensation Administrative Tax (WC Tax)/ Workers’ Compensation Administrative Surcharge (Admin Surcharge). Pursuant to Section 287.690 RSMo and Section 287.710 RSMo, the WC Tax is a tax based upon the net deposits, net premiums or net assessments received, whether in cash or notes in this state, or on account of business done in this state by workers' compensation insurance companies or is based upon the net premium equivalents for those self-insured employers (individual self-insured employers and group trusts) authorized to self-insure in Missouri.

The rate for the WC Tax and the Admin Surcharge is the same for both and is set each year by October 31 by the Director of the Division of Workers’ Compensation. The WC Tax rate can vary between 0% and 2%; however, it is based on the funding needs of the Division and is calculated using the formula in the statute.

Each year, the authorized self-insured employers and group trusts file an annual report by March 1 (Table 1 Payroll and Premium Tax Report for self-insured employers) with the Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP). Based on the premium certified by April 30 by the DIFP the Missouri Department of Revenue (DOR) assesses the annual WC Tax to the self-insured employers. Any additional annual WC Tax is due to the DOR by June 1.

Self-insured employers are assessed quarterly prepayments by the DOR based on 25% of their prior year direct written workers’ compensation premiums (insurance companies) or premium equivalents (self-insured employers) multiplied by the current year tax rate. These quarterly installments or prepayments are due on March 1, June 1, September 1 and December 1 to the DOR. The March 1 assessment is a blank assessment which is completed by the insurance companies or self-insured employers based on the premiums or premium equivalents they reported on the annual report to the DIFP. The June 1 assessment serves three purposes: (1) it determines the annual tax due/overpayment; (2) it reconciles for the 1st quarterly installment made; and (3) it assesses the quarterly amount due for the 2nd quarter. Any credits that develop due to overpayments of the annual tax are credited against the quarterly amounts due starting with the June quarterly installment.

Each year group trusts are required to submit an experience modification factor. Group trusts should contact SI_PTax@insurance.mo.gov for information on how to submit the group experience modification factors.

At the end of each year, DIFP emails each self-insured group trust plan administration regarding their workers' compensation tax information which includes the Table 1 Payroll and Premium Tax Report. The Table 1 Payroll and the Premium Tax Reports are to be filed manually to:

Taxation Section
Missouri Department of Insurance, Financial Institutions and Professional Registration
P.O. Box 690
Jefferson City, MO 65102-0609

All assessments will be emailed from the DIFP and are due to the DOR with payment by the due dates. Any questions regarding the WC Tax for group trusts should be directed to SI_PTax@insurance.mo.gov.

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Advantages of a Self-Insurance Group Trust

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Disadvantages of a Self-Insurance Group Trust

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Regulatory Requirements

The Division of Workers’ Compensation has the regulatory authority over the group trust and the employers who participate in the group trust. The group trust and its members must abide by the Rules Governing Self-Insurance found at 8 CSR 50-3.010 and the statutory requirements set forth in Chapter 287, Revised Statutes of Missouri. Members of the group trust are required to pay the workers’ compensation tax and second injury fund surcharge as required of all Missouri employers.

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Forming a New Group Trust

In order to form a new group trust, the following requirements must be met:

Upon meeting these requirements the employer will need to fill out all of the application forms found on this Web site and forward them to the Division. The forms must be accompanied by a $500 non-refundable application fee. There is a checklist in the online application that states exactly what is needed to be provided. Please contact the Division at 573-526-3692 with any questions.

Application Forms

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How Do I Become a Member of an Existing Group Trust?

Many times a group trust will have minimum premium requirements and underwriting guidelines that must be satisfied before an employer can become a member of the group trust. To find out more about a self-insurance group trust, contact your trade association, business group or call the Missouri Division of Workers’ Compensation, Insurance Unit at 573-526-3692. See next section on how to obtain a listing of group trusts. After a group trust is formed, they have the authority to admit and terminate members pursuant to (8 CSR 50-3.010(5)(E)).

The Division must approve all new members of the Group Trust.

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How do I obtain a listing of the Group Trusts?

The Division has listings of individual self-insured companies and group trusts in Missouri. Anyone interested in obtaining the listings should contact the Division at 573-526-3692. A formal written request and payment may be required. It can be sent to the following address:

Division of Workers’ Compensation
Insurance Unit
P.O. Box 58
Jefferson City, MO 65102-0058
Telephone: 573-526-3692

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Reporting Requirements

General Reporting Requirement: Pursuant to 8 CSR 50-3.010(6)(A)10. The group trust shall notify the Division at least 30 days prior to any change in ownership, officers, trustees, operations, service company, address, security, or any other change that affects the group trust's self-insurance status. If a member of the group trust changes address or ownership, the group trust shall notify the Division within 30 days of the change.

Quarterly submissions to the Division:

Annual submissions to the Division:

As they occur submissions to the Division:

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Will I be Subject to Audits?

Yes, the Division has the authority to conduct claims, safety and other audit deemed necessary and appropriate by the Division. The Division performs four different types of audits: compliance audits, reserve audits, complaint audits, and safety audits.

Compliance Audits are random or specific audits that provide the Division with information on how your workers’ compensation program processes injured employee’s cases and whether the process is in compliance with the Missouri Statues, rules and regulations.

Reserve Audits are generated to determine if the self-insurer has sufficient amount of security based on their claim exposure with the state of Missouri.

Complaint Audits are generated if the Division receives repeated complaints on the same issue or receives a complaint that is indicative of non-compliance issues.

Safety Audits are conducted to review all written safety and health programs as well as the credentials and experience of loss control and safety personnel, the structure of, and resources available to, the loss control or safety department, and to provide an on-site audit of the implementation of the employers’ safety program.

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DISCLAIMER - More Information

The Employers, Insurers, TPAs section of the Workers' Compensation portion of this web site is targeted specifically to employers, insurers and third party administrators and is intended to be a resource throughout the workers' compensation claim process. It is NOT intended to be a substitute for legal representation.

Injured workers seeking information about the workers' compensation process should use the Injured Workers section of the Workers' Compensation web site to find information targeted specifically to them.

Additional information about Missouri Workers' Compensation laws, the Division of Workers Compensation, the Second Injury Fund and more may be found via the Workers' Compensation home page.