The Federal Highway Administration wants to increase financial requirements and raise fees for carriers waiting to self-insure.
The new rules, which would apply only to liability insurance, would require self-insured carriers to maintain adequate cash flow, after expenses, to cover double the amount of self-insured claims paid in the last 12 months. Currently, they must only show adequate tangible net worth to meet statutory insurance obligations. Carriers that fail to meet the standard will lose self-insurance privileges and will have to provide adequate collateral to cover any outstanding claims liability. Unfunded letters of credit would not be accepted.
FHWA would extend the automatic expiration for carriers with less than satisfactory safety ratings from 30 to 45 days in order to give field staff sufficient time to upgrade a carrier's rating if corrective action is taken.
The current $4,200 initial filing fee would be reduced to $3,000, but FHWA would add a $2,500 fee for any modifications. The agency would also step up financial monitoring of self-insured carriers and would impose an annual $2,600 fee to cover those costs.
Comments are due in writing before July 6, 1999. The notice was published in the May 5, 1999, Federal Register and can be accessed on the Internet at http://www.access.gpo.gov.