Louisiana Revised Statutes 42:455 – Payroll deduction rules
Terms Used In Louisiana Revised Statutes 42:455
- Contract: A legal written agreement that becomes binding when signed.
- Statute: A law passed by a legislature.
- Tort: A civil wrong or breach of a duty to another person, as outlined by law. A very common tort is negligent operation of a motor vehicle that results in property damage and personal injury in an automobile accident.
A. Authority for payroll deductions not otherwise provided by statute shall be governed by rules promulgated by the division of administration and administered by the state payroll office. Providing any general insurance deduction vendors shall have met the following requirements:
(1) Foreign companies shall:
(a) Have been licensed to do business in this state for not less than five years.
(b) Have a current rating in A.M. Best of B+ or better, unless:
(i) Notwithstanding any other law, rule, or regulation to the contrary, and if they are in good standing with the Department of Insurance, and subject to the other applicable provisions of this Section, a foreign company which has participated in the payroll deduction system for a period of at least ten years and has a rating in A.M. Best of B, may continue to market and sell insurance policies through payroll deduction until the beginning of the next open enrollment period following the four-year anniversary date from the date of the issuance of the B rating by A.M. Best, provided they have maintained a rating of B or better for the entire four-year period. Thereafter, in the event that the foreign insurer has maintained a rating of B by A.M. Best and that rating is increased from B to a B+ or better and they meet the other applicable requirements of this Section and other applicable rules and regulations, they may resume marketing and selling insurance through the payroll deduction system; or
(ii) Notwithstanding any other law, rule, or regulation to the contrary, if a foreign company has been participating in the payroll deduction system for a period of at least ten years, and they have a rating in A.M. Best of B, they may maintain and administer indefinitely those policies purchased through payroll deduction as long as they maintain a rating by A.M. Best of no less than a B, are in good standing with the Department of Insurance, and comply with other applicable rules, and regulations, and laws and the provisions of this Section.
(c) Have been doing business under the same name for not less than three years.
(d) Offer like product, service, or coverage to citizens of Louisiana.
(e) Be in compliance with all procedural, accounting, and reporting requirements governing employee deductions.
(2) Domestic companies shall:
(a) Have been licensed to do business in this state for not less than five years.
(b) Have a current rating in A.M. Best of B or better, or if the company is of insufficient size to obtain a rating by A.M. Best, has posted a bond with the division of administration in the amount of:
(i) One hundred thousand dollars, if the company is a member insurer of the Louisiana Life and Health Insurance Guaranty Association; or
(ii) Two hundred fifty thousand dollars, if the company is not a member insurer of the Louisiana Life and Health Insurance Guaranty Association, or if the product for which the deductions are proposed is not covered under the Louisiana Life and Health Guaranty Association Act.
(c) Have been doing business under the same name for not less than three years.
(d) Provide like product, service, or coverage to citizens of Louisiana.
(e) Be in compliance with all procedural, accounting, and reporting requirements of all rules and requirements governing employee deductions.
B. The rules shall establish minimum reserve balances, bonding requirements, or other appropriate measures of fiscal responsibility for any payroll applicant not regulated by the Department of Insurance or office of financial institutions or any deduction, excepting charitable organizations, authorized by statute.
C. Payroll deductions authorized by statute shall comply with reporting, remittance, and system schedule requirements of rules promulgated by the Division of Administration and administered by the state payroll office as provided in this Section.
D.(1) Notwithstanding any law, rule, or regulation to the contrary, every vendor receiving payment through voluntary payroll deductions as of July 1, 2001, under the Uniform Payroll System, shall continue to be approved as a vendor if such vendor continues to meet the requirements of the rules and regulations of the division of administration governing payroll deductions which were in effect on May 19, 2000. Further, those vendors receiving payment through voluntary payroll deductions, under the Uniform Payroll System, as of July 1, 2001, who apply for a new payroll deduction for additional products, policy forms, or service plans may do so subject to the rules and regulations of the division of administration governing payroll deductions which were in effect on May 19, 2000.
(2) The provisions of this Subsection shall be null, void and of no effect on August 1, 2002, or on the date revised rules and regulations adopted in accordance with the provisions of La. Rev. Stat. 42:455(A) become effective, whichever is later.
E. Payroll deductions authorized by this Chapter shall give rise to no liability against the state, whether in contract or in tort, regarding either the administrative processing of the deduction or the quality or appropriateness of the product or its vendor.
Acts 1986, No. 805, §1; Acts 2001, No. 1029, §1; Acts 2004, No. 284, §1, eff. July 1, 2004; Acts 2004, No. 589, §1, eff. June 29, 2004.