S.D. Admin. R. 20:06:57:03

Current through Register Vol. 50, page 159, June 17, 2024

Section 20:06:57:03 - Application for authorization

A person applying for authorization pursuant to SDCL 58-18-88 shall submit a plan of operation with the director. The application and plan of operation shall include the following:

(1) A business plan including a copy of all contracts or other instruments which the multiple employer trust proposes to make with or sell to its members, a copy of the plan description, and the printed materials to be used in the solicitation of members;

(2) Copies of all articles, bylaws, agreements, trust documents, or other documents or instruments describing the rights and obligations of employers, employees, and beneficiaries;

(3) A current list of all members of the employer group or association sponsoring the multiple employer trust and a description of the relationship among the employers which serves as the basis for the formation of the association or employer group;

(4) A description of the activities of the association or group of employers on behalf of its members other than the sponsorship of the multiple employer trust;

(5) Current financial statements of the multiple employer trust which shall include, at a minimum, balance sheets, income statement, cash flow statement, and a detailed listing of assets;

(6) An actuarial opinion prepared, signed, and dated by a member of the American Academy of Actuaries which states that appropriate loss and loss adjustment reserves have been established, that adequate premiums are being charged, and that the association multiple employer trust is operating in accordance with sound actuarial principles;

(7) A statement from an authorized representative of the applicant which certifies all of the following:

(a) The multiple employer trust is administered by an authorized insurer or an authorized third-party administrator;

(b) The multiple employer trust is eligible for authorization pursuant to SDCL 58-18-88;

(c) The association or group of employers sponsoring the multiple employer trust is engaged in substantial activity for its members other than sponsorship of an employer benefit plan; and

(d) The association is a nonprofit entity organized and authorized to do business under applicable South Dakota law;

(8) A statement from an authorized representative of the applicant which certifies that the provisions of SDCL 58-18-88 and this chapter have been met;

(9) A statement from the applicant that, to the best of its knowledge and belief, the multiple employer trust is in compliance with all applicable provisions of the Employee Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.);

(10) A description of the mechanism approved by the director to ensure that claims will be paid in the event that a member of the multiple employer trust is unable to comply with the multiple employer trust's contribution requirements;

(11) A copy of the most recent Form M-1 filed by the multiple employer trust with the U.S. Department of Labor, Pension and Welfare Benefits Administration, if applicable; and

(12) Any additional information requested by the director.

S.D. Admin. R. 20:06:57:03

40 SDR 102, effective 12/3/2013; 45 SDR 158, effective 6/27/2019

General Authority: SDCL 58-18-79, 58-18-89.

Law Implemented: SDCL 58-18-88, 58-18-89.