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2011 Maryland Attorney General Reports and Opinions 3 (2011)

handle is hein.sag/sagmd0034 and id is 1 raw text is: WORKERS' COMPENSATION INJURED WORKERS' INSURANCE FUND - WHETHER THE STATE HAS AN INTEREST IN THE RESERVES, SURPLUS, AND OTHER ASSETS OF THE INJURED WORKERS' INSURANCE FUND March 14, 2011 Thomas Phelan CEO/President Injured Workers Insurance Fund You have asked for our opinion on two questions concerning the Injured Workers' Insurance Fund (IWIF). Specifically, you ask: 1. Who owns IWIF's reserves and surplus? 2. Does the State have any claim to IWIF's reserves, surplus, or other assets? For the reasons set forth below, it is our opinion that: 1. The reserves and surplus that the Insurance Article requires IWIF to maintain with respect to its policies are held in trust for the employers who are IWIF's policyholders and the employees who are entitled to benefits under IWIF's policies. If the General Assembly chose to terminate IWIF's existence, it would need to make arrangements to preserve such funds for those purposes. 2. To the extent that IWIF has assets in excess of the reserves and surplus required by the Insurance Article, upon IWIF's termination, those assets would belong to the State, which created IWIF. The statute governing IWIF provides for the General Assembly to direct the disposition of those assets or for the assets to be distributed as justice requires. I Background A. State Workers' Compensation System Like the laws of other states, Maryland law requires employers to have workers' compensation insurance to compensate employees 3