News Notes: Self-Insured Employer On The Hook For Insolvent Insurer’s Portion Of Workers’ Comp Benefits

As some workers’ comp insurers struggle to stay afloat, you may be wondering what would happen if yours became insolvent. In a recent case, a Denny’s employee’s work-related cumulative injury occurred over a one-year period that overlapped two months with the time Denny’s was self-insured for workers’ comp. During the other 10 months, Denny’s was insured through HIH America, which became insolvent. But now a California appeals court has ruled that Denny’s is on the hook for the entire claim. That’s because when there’s more than one insurer for a claim and one becomes insolvent, the other is responsible for paying the claim.