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Inspections of Adequacy of Accident Prevention Facilities and Services

§ 166.5

Inspections of Adequacy of Accident Prevention Facilities and Services

(a) Inspections. The division may conduct inspections to determine the adequacy of an insurance company's accident prevention services.

(1) The division will conduct an initial inspection of each insurance company's accident prevention facilities and the company's use of accident prevention services after the effective date of this section. After the initial inspection, the division may conduct an inspection of an insurance company's accident prevention facilities and the company's use of accident prevention services as often as the division considers necessary to determine compliance with this chapter.

(2) Affiliated companies of an insurer may be inspected together if the same facilities, programs, and personnel are used by each of the companies.

(3) At least 90 days prior to an inspection, the division shall notify the insurance company in writing of the inspection. The notice shall specify the location of the inspection and the date on which the inspection will occur.

(4) Notwithstanding the provisions of this section, the division may conduct unannounced on-site visits to determine compliance with the Act and division rules in accordance with the procedures governing on-site visits in Chapter 180 of this title (relating to Monitoring and Enforcement).

(b) Site of inspection. The inspection of the insurance company's accident prevention services shall take place as determined by the division at:

(1) the insurance company office in Texas; or

(2) the division's Austin headquarters.

(c) Pre-inspection exchange of information.

(1) At least 60 days prior to the date set for inspection, in the format and manner specified by the division, the insurance company shall provide to the division:

(A) a list of policyholders, for the period of time determined by the division, by policyholder name, policy number, effective date or expiration date of the policy, premium, number of fatalities, principal Texas location, indication of whether the insurance company has contracted with the policyholder for accident prevention services, and indication of whether that policyholder has requested accident prevention services. The list shall be taken from the insurance company's most current records, separated by affiliated companies, arranged in descending order by premium, and include all policies; and

(B) a copy of all accident prevention services procedures, including any changes since the insurance company's last annual report.

(2) Within 10 days of receipt of the policyholder list, the division shall select the specific policyholder files to be evaluated and notify the insurance company of those selected files.

(3) For each policy selected by the division, the insurance company shall prepare an accident prevention services worksheet in the format and manner prescribed by the division. The worksheet shall include the:

(A) policyholder name;

(B) policy number;

(C) number of employees;

(D) principal Texas office address or principal corporate office address if there is no principal Texas office address;

(E) primary NAICS code;

(F) A. M. Best Hazard index number;

(G) policyholder contact person's name, phone number, and email address;

(H) insurance company name;

(I) effective date of the policy;

(J) name of person completing the form and date completed;

(K) service and loss information for policy years as requested by the division, including:

(i) total premium;

(ii) number of claims;

(iii) number of and dates of fatalities;

(iv) loss ratio;

(v) experience modifier;

(vi) surveys (list all dates);

(vii) recommendation letters (list all dates);

(viii) training programs (list all dates);

(ix) consultations (list all dates);

(x) analyses of accident causes (list all dates);

(xi) industrial hygiene services (list all dates);

(xii) industrial health services (list all dates);

(xiii) policyholder requests (list all dates requested and dates provided);

(xiv) underwriting requests (list all dates requested and dates provided);

(xv) insurance company determinations in accordance with § 166.2(b)(4) of this title (relating to Adequacy of Accident Prevention Services) (list all dates need for services were determined and dates offered);

(xvi) description of policyholder operations; and

(xvii) comments.

(4) At least 10 days prior to the date of the inspection, the insurance company shall file the completed worksheets with the division.

(d) Information to be made available at the inspection. The insurance company shall make available for the time frame specified by the division:

(1) the loss control files corresponding to the requested worksheets;

(2) a sample policy declaratory page as evidence that each policyholder has been provided the notice required by § 166.2(b)(1) of this title;

(3) a copy of loss runs for each selected policyholder that includes:

(A) number of injuries;

(B) accident or illness types;

(C) body parts involved;

(D) injury causes; and

(E) fatalities;

(4) a copy of all documentation of services provided in accordance with § 166.2(b)(2)-(5) of this title.

(5) samples of policyholder training materials, audiovisual aids, and training programs; and

(6) other information requested by the division which is necessary to complete the inspection. Information requested may include, but is not limited to:

(A) records of surveys;

(B) consultations;

(C) recommendations;

(D) training provided;

(E) loss analyses;

(F) industrial health and hygiene services;

(G) return-to-work coordination services information; and

(H) the name, location, status (whether employee or contractor), and qualifications of each person that provided accident prevention services in the loss control files being reviewed during the inspection.

(e) Insurance company policyholder visits and contacts. The division may conduct scheduled visits of the jobsite of an insurance company's policyholder and make other off-site contacts with a policyholder to obtain information about the insurance company's accident prevention facilities and use of services.

(f) Written report of inspection.

(1) The division shall prepare a written report of the inspection and shall provide a copy to the insurance company's executive management and to the Texas Department of Insurance, Loss Control Regulation Division.

(2) The inspection report shall contain the division's determination of adequacy in accordance with Labor Code § 411.061 and § 166.2 of this title, and include specific findings and required corrective actions. The inspection report will indicate whether the division has issued a final determination of adequacy, a final determination of inadequacy, or an initial determination of inadequacy with regard to an insurance company's accident prevention services.

(3) The division will provide written notification to the insurance company of specific deficiencies and recommendations for corrective action if it assigns an initial determination of inadequacy. Not later than the 60th day after the date of the initial inspection report, the insurance company shall provide written documentation evidencing its compliance with the division's recommendations contained in the initial inspection report. The written documentation shall detail the corrective actions being taken to address each specific finding. If the insurance company believes that it will take more than 60 days to implement the recommendations listed in the initial inspection report, it shall request an extension from the division. After the end of the correction period a final determination of adequacy or inadequacy will be assigned. The division shall provide the insurance company with notification of this final determination.

(4) The division shall issue a certificate of inspection to each insurance company after completion of an inspection in which the accident prevention services are deemed adequate.

(5) In addition to any sanction authorized by law, a final determination of inadequacy may be cause for withholding a certificate of inspection or reinspection.

(g) Reinspection.

(1) After an inspection and a final determination of inadequacy of an insurance company's accident prevention services, the division shall reinspect the accident prevention services of the insurance company not earlier than the 180th day or later than the 270th day after the date the accident prevention services were determined by the division to be inadequate.

(2) Information required under this section to be provided at the time of initial inspection is required to again be provided at the time of reinspection in accordance with the time frames established within this section.

(h) This section is effective October 1, 2013.

The provisions of this §166.5 adopted to be effective September 1, 1995, 20 TexReg 5248; amended to be effective October 1, 2013, 38 TexReg 2000.

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