Chapter 65

§ 6501 Definitions. As used in this chapter: (1) “Administrator” means the Insurance Coverage Administrator, hereinafter established by § 6505 of this title. (2) “The Committee” means the Insurance Coverage Determination Committee, hereinafter established by § 6502 of this title. (3) “The Fund” means the State Self-Insurance Fund as provided for by subchapter III of this chapter. 18 Del. C. 1953, §  6501; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  1 ; § 6502 Insurance for the protection of the State and the public; determination of coverage. There is hereby established the Insurance Coverage Determination Committee, which shall be composed of the Secretary of the Department of Human Resources, the State Auditor and the Insurance Commissioner or their designees, during their respective terms of office. The Secretary of the Department of Human Resources or his or her designee shall serve as the Chair of the Committee. The Committee shall from time to time determine the method of insuring, the amount of insurance, and the class of coverage covering any type of risk to which the State may be exposed, including, but not limited to: property insurance, as defined in § 904 of this title; surety insurance, as defined in § 905(a)(1) of this title; casualty insurance, as defined in § 906 of this title; marine and transportation and “wet marine” insurance, as defined in § 907 of this title; title insurance, as defined in § 908 of this title; to be effected and carried by the State or any subdivision thereof, including all school districts, but excluding, however, municipal corporations, counties, and the authorities relating to the crossings of the Delaware River and the Delaware Bay. 18 Del. C. 1953, §  6502; 57 Del. Laws, c. 187, §  2 ; 70 Del. Laws, c. 186, §  1 ; 79 Del. Laws, c. 286, §  2 ; 81 Del. Laws, c. 66, § 14 ; § 6503 Forms of coverage. The Committee shall: (1) Protect this State from loss to state-owned property; (2) Protect the public from wrongful actions of state officials and employees and failure or malfunction of state-owned property; (3) Secure for this State the maximum economic advantage feasible in the operation of its insurance coverage program, including, when deemed appropriate to such end, the utilization of blanket policies, deductible or excess loss insurance, and self-insurance; (4) Determine such insurance protection as shall be required by the needs of the State and as shall be most economically advantageous to the State by providing for, as they shall deem appropriate, no insurance on small losses, coverage by commercial insurance, coverage by self-insurance or a combination of such methods. 18 Del. C. 1953, §  6502A; 57 Del. Laws, c. 187, §  2 ; § 6504 Rules and regulations. The Insurance Coverage Administrator, with the approval of the Committee, shall promulgate such rules and regulations as shall be necessary to carry out the policy determinations of the Committee in administering the state insurance coverage program, so as to effectively provide coverage for the State whether same be procured from commercial insurance or by self-insurance or a combination of both. 18 Del. C. 1953, §  6502B; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  3 ; § 6505 Establishment of Insurance Coverage Office. There is hereby established under the direction and supervision of the Secretary of the Department of Human Resources the Insurance Coverage Office, the executive head of which shall be the Insurance Coverage Administrator, who shall serve in the state classified service. 18 Del. C. 1953, §  6503; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  4 ; 81 Del. Laws, c. 66, § 15 ; § 6506 Qualifications of the Insurance Coverage Administrator. The Administrator shall be qualified for the office by virtue of the Administrator’s education and experience. The Administrator shall not be associated directly or indirectly with any insurance agency, firm or corporation. The Administrator shall be charged with and responsible for the administration of the Insurance Coverage Office as herein provided. 18 Del. C. 1953, §  6504; 57 Del. Laws, c. 187, §  2 ; 70 Del. Laws, c. 186, §  1 ; 79 Del. Laws, c. 286, §  5 ; § 6507 Salary of the Director of Insurance Coverage [Repealed]. 18 Del. C. 1953, §  6505; 57 Del. Laws, c. 187, §  2 ; repealed by 79 Del. Laws, c. 286, § 6, eff. July 1, 2014. ; § 6508 Duties of the Insurance Coverage Office. The Insurance Coverage Office shall provide: (1) The placement of all insurance with commercial insurers as directed by the Committee; (2) The operation of the Self-Insurance Fund, as established in subchapter III of this chapter; (3) Centralized responsibility for the operation of the state insurance coverage program vested in a single agency with an adequate staff of legal, actuarial and administrative resources; (4) The establishment and operation of an open bid procedure to be maintained for purchasing new insurance coverage from commercial insurers and renewing existing contracts with such commercial insurers which will permit the free forces of market competition to operate to the benefit of the state insurance coverage program; (5) The keeping of all policies with commercial insurers and all records necessary and pertinent thereto in some safe and secure place; (6) The keeping in some safe and secure place of all records, accounts, claims files, statistical studies and other such records and documents necessary and proper in the administration of the self-insurance program, when and if the Committee deems it proper to utilize same; (7) The periodic preparation of reports as to the commercially procured insurance coverage part of the program which shall present the basic statistical-actuarial data pertaining to the experience of that part of the program and its component parts, which reports shall be public documents; (8) Provide to the commercial insurance industry such information about bidding procedures as is required by the statutes of this State, so that any qualified commercial insurer may have an opportunity to offer its service to this State in the areas where the Committee has deemed it desirable to procure commercial coverage; (9) Periodic comprehensive insurance surveys of program needs, and a continuing review of existing commercially procured insurance contracts, as well as analysis of commercial rates in terms of changing economic conditions, and periodic studies of commercial market conditions and developments; (10) Such special investigations and reports as may be requested by the Committee Chair; (11) Technical assistance to the volunteer fire departments in the State concerning insurance matters relating to their operations. Such assistance shall be given only at the request of the president of a company; and (12) The implementation and monitoring of loss prevention activities. 18 Del. C. 1953, §  6506; 57 Del. Laws, c. 187, §  2 ; 60 Del. Laws, c. 130, §  1 ; 79 Del. Laws, c. 286, §  7 ; § 6509 Insurance by other agencies of the State. No other agency of this State, for which coverage is herein provided, shall be authorized to place any insurance, any law to the contrary notwithstanding, and all insurance for such agencies shall be placed by and through the Insurance Coverage Office. 18 Del. C. 1953, §  6507; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  8 ; § 6510 Existing insurance contracts. Existing insurance contracts and any renewals thereof may continue in full force and effect unless and until otherwise provided by the Administrator. 18 Del. C. 1953, §  6508; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  9 ; § 6511 Defense of sovereignty prohibited. The defense of sovereignty is waived and cannot and will not be asserted as to any risk or loss covered by the state insurance coverage program, whether same be covered by commercially procured insurance or by self-insurance, and every commercially procured insurance contract shall contain a provision to this effect, where appropriate. 18 Del. C. 1953, §  6509; 57 Del. Laws, c. 187, §  2 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 6520 Placement of commercial insurance. When the Administrator shall determine and declare it to be advisable to insure against a certain risk or risks with commercially procured insurance, with the approval of the Committee, then, as to such risk or risks, the Insurance Coverage Office shall provide for the placement of such insurance as shall be necessary with duly accredited and qualified commercial insurers. The purchase of all new insurance policies and the renewal of all existing policies shall be by open bid procedure under rules and regulations promulgated by the Administrator calculated to permit the free forces of market competition to operate to the economic benefit of the state insurance coverage program. 18 Del. C. 1953, §  6520; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  10 ; § 6521 Payment of premiums on commercial insurance. The estimated appropriation necessary for commercially procured insurance as authorized by § 6520 of this title for each fiscal year shall be determined by the Insurance Coverage Office and submitted to the Secretary of the Department of Human Resources for review and consideration as part of the annual budget requested by the Department. Upon appropriation by the General Assembly the funds shall be utilized by the Administrator for the payment of premiums for coverages. 18 Del. C. 1953, §  6521; 57 Del. Laws, c. 187, §  2 ; 70 Del. Laws, c. 186, §  1 ; 79 Del. Laws, c. 286, §  10 ; 81 Del. Laws, c. 66, § 16 ; § 6522 Administration and records. The administration of the commercially insured part of the state insurance coverage program shall be the responsibility of the Insurance Coverage Office which shall keep in some safe and secure place all policies of insurance and all records pertaining thereto and such other records, reports, studies, analysis and correspondence as is necessary to effectuate the efficient and economic administration of the program. 18 Del. C. 1953, §  6522; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  11 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 6530 Placement of self-insurance. (a) When the Administrator shall determine and declare it to be advisable to insure against a certain risk or risks through a self-insurance program, then a request shall be made of the General Assembly in an amount equal to anticipated claims and expenses for a Self-Insurance Fund Contingency Account, hereinafter referred to as “the Fund.” (b) The Administrator shall be responsible for the administration of the Fund and the payment of claims and costs. (c) In the event that the Committee shall elect to procure commercial insurance on risks which are self-insured, they may direct that the initial premium for such commercial policies covering such risk or risks shall be paid from the Fund. 18 Del. C. 1953, §  6530; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  12 ; § 6531 Capitalization of the State Self-Insurance Fund. 18 Del. C. 1953, §  6531; 57 Del. Laws, c. 187, §  2 ; 59 Del. Laws, c. 279, §  1 ; repealed by 79 Del. Laws, c. 286, § 13, eff. July 1, 2014. ; § 6532 Payment of premium allocations. The estimated appropriation necessary for each fiscal year shall be determined by the Insurance Coverage Office and submitted to the Secretary of the Department of Human Resources for review and consideration as part of the annual budget requested by the Department. Upon appropriation by the General Assembly, the funds shall be utilized for the purposes of paying coverages. 18 Del. C. 1953, §  6531A; 57 Del. Laws, c. 187, §  2 ; 59 Del. Laws, c. 279, §  2 ; 79 Del. Laws, c. 286, §  14 ; 81 Del. Laws, c. 66, § 17 ; § 6535 Administration and custody of the State Self-Insurance Fund. 18 Del. C. 1953, §  6532; 57 Del. Laws, c. 187, §  2 ; 63 Del. Laws, c. 142, §  38 ; repealed by 79 Del. Laws, c. 286, § 15, eff. July 1, 2014. ; § 6536 Investment of moneys in the Fund. 18 Del. C. 1953, §  6533; 57 Del. Laws, c. 187, §  2 ; 63 Del. Laws, c. 142, §  39 ; repealed by 79 Del. Laws, c. 286, § 16, eff. July 1, 2014. ; § 6537 Provisions for deductible limits. The Committee, from time to time, may declare and enforce such deductible limits on any insured risk covering loss to state-owned property, both real, personal and mixed, as it shall deem appropriate. 18 Del. C. 1953, §  6534; 57 Del. Laws, c. 187, §  2 ; § 6538 Provisions for reinsurance. The Committee, from to time, may determine the advisability of purchasing commercial reinsurance contracts as to any risk or risks covered by the Fund and direct the Insurance Coverage Office to place such insurance, in such amount as the Committee shall have determined to be most feasible, in the manner herein provided for the placement of other commercial insurance coverage. 18 Del. C. 1953, §  6535; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  17 ; § 6539 Adjusting claims and paying losses. The Insurance Coverage Office shall have the responsibility of adjusting all claims and paying all losses in risks covered by the Fund, and shall carry out its duties in conformity with appropriate regulations promulgated for that purpose by the Administrator, which regulations shall be in general conformity with the accepted practice in the commercial insurance industry in such matters, and shall be calculated to provide for prompt, efficient and equitable settlement procedures. The Insurance Coverage Office shall keep such records and files as shall be necessary and proper in its fulfillment of this obligation. 18 Del. C. 1953, §  6536; 57 Del. Laws, c. 187, §  2 ; 79 Del. Laws, c. 286, §  18 ; § 6540 Arbitration of disputes and litigation of claims. (a) Any dispute between the Insurance Coverage Office and a state agency claimant, which cannot be amicably resolved, shall be referred to arbitration before an arbitrator selected by the Secretary of State. The expense of such arbitration will be borne by the disputants equally. The decision of the arbitrator will be final and binding upon the disputants. (b) Any dispute between the Insurance Coverage Office and a claimant under the workers’ compensation coverage, should same be covered by the Fund, which cannot be amicably resolved, shall be handled in the manner of a claim against a commercial insurer before the Industrial Accident Board with all normal rights of appeal. (c) Any dispute between the Insurance Coverage Office and a claimant not otherwise covered in subsections (a) and (b) of this section, which cannot be amicably resolved, may be made the subject of litigation in any court of competent jurisdiction in this State. 18 Del. C. 1953, §  6537; 57 Del. Laws, c. 187, §  2 ; 71 Del. Laws, c. 84, §  26 ; 79 Del. Laws, c. 286, §  19 ; § 6541 Inspections of insured property. The Insurance Coverage Office shall have available to it the services of the State Fire Marshal and the State Fire Marshal’s deputies for the purpose of inspecting self-insured real and personal property of the State, and may call upon the Fire Marshal and State Fire Marshal’s deputies to conduct such inspections of such property as are reasonable and necessary to determine the risk involved in insuring same and to provide the basis for requests or suggestions as to how undesirable hazards may be corrected; and the Fire Marshal and the State Fire Marshal’s deputies shall cooperate with the Insurance Coverage Office in this regard, conducting such investigations as are requested and reporting the results thereof to the Insurance Coverage Office together with such recommendations as the investigator shall deem to be appropriate. All state agencies, officials and employees will render full cooperation to the Fire Marshal and the Insurance Coverage Office in these matters and shall promptly correct such hazards as are found to exist, and failure to do so shall be referred to the Secretary of the Department of Human Resources by the Insurance Coverage Office for such remedial executive action as the Governor shall deem appropriate. 18 Del. C. 1953, §  6538; 57 Del. Laws, c. 187, §  2 ; 70 Del. Laws, c. 186, §  1 ; 79 Del. Laws, c. 286, §  20 ; 81 Del. Laws, c. 66, § 18 ; § 6542 Independent contractors. The Administrator shall first employ all resources available in the Insurance Coverage Office, the Insurance Department, the office of the State Fire Marshal, the Justice Department, and the Auditor’s Office before retaining independent contractors, but in the event that special expertise is required for the performance of the Administrator’s duties not otherwise available or not readily available to the Administrator when required, then the Administrator is authorized and directed to contract for the services of such independent contractors as shall be best equipped to render such services, including, but not limited to, accountants, actuaries, claims adjusters and investigators, attorneys and engineers, which contracts shall be on an ad hoc or per case basis, and for which the Administrator is authorized to make payment by drafts upon the Fund as an administrative expense of the Fund. 18 Del. C. 1953, §  6539; 57 Del. Laws, c. 187, §  2 ; 70 Del. Laws, c. 186, §  1 ; 79 Del. Laws, c. 286, §  21 ; § 6543 Fidelity bonds. In the event that the Committee determines and declares it advisable to self-insure the statutory required fidelity bonds of the officials and/or employees of the State or its herein covered subdivisions, and establishes a self-insurance program in that regard, then those provisions of the several statutes of this State requiring that such bonds be with corporate surety are superseded as to such bonds as are covered by such self-insurance program to the extent that said statutes required corporate surety. 18 Del. C. 1953, §  6540; 57 Del. Laws, c. 187, §  2 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? 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