Georgia Department of Law, from the office of Michael J. Bowers, Attorney General

Official Opinion 94-20

July 6, 1994

Executive Secretary
State Ethics Commission


A company or group which has obtained a certificate of authority to operate a self-insurance program from the Commissioner of Insurance is a regulated entity under O.C.G.A. § 21-5-30.1. Companies, which are not insurance companies but which provide services similar to insurance such as that provided by motor clubs, are not regulated entities, where the Commissioner of Insurance exercises no statutory control or regulation over the entity.

This responds to your request for an official opinion concerning the application of O.C.G.A. § 21-5-30.1 to self-insurers and other entities which, while they are not insurance companies, provide services which are similar to insurance. Specifically, you have asked whether a company or group which has been issued a certificate of authority by the Commissioner of Insurance to operate a self-insurance program would be a regulated entity as defined in O.C.G.A. § 21-5-30.1(a)(5).

Official Code of Georgia Annotated § 21-5-30.1(b) prohibits regulated entities from making contributions to or on behalf of candidates or incumbents of the elected office which regulates the entity. Official Code of Georgia Annotated § 21-5-30.1(a)(5) defines regulated entity as:

. . . any person who is required by law to be licensed by an elected executive officer or a board under the jurisdiction of an elected executive officer, any person who leases property owned by or for a state department, or any person who engages in a

business or profession which is regulated by an elected executive officer or by a board under the jurisdiction of an elected executive officer.

Under various Code Sections, it is evident that self-insurance funds for automobile liability, health insurance, and workers' compensation are "regulated entities" for the purposes of O.C.G.A. § 21-5-30.1. With respect to automobile coverage, O.C.G.A. § 33-34-2(3) defines "self-insurer" as "any owner who has on file with the Commissioner of Insurance an approved plan of self-insurance which provides for coverages, benefits, and efficient claims handling procedures substantially equivalent to those afforded by a policy of automobile liability insurance that complies with all of the requirements of this chapter." Under O.C.G.A. § 33-8-1(C), the fee charged by the Commissioner of Insurance in relation to an application for a certificate of authority for automobile self-insurance is $100.00.

With respect to self-insurance for health coverage, O.C.G.A. § 33-50-2(a) provides that it is unlawful for multiple employer self-insurance health plans to transact business in Georgia "without a license issued by the Commissioner [of Insurance]." Under O.C.G.A. § 33-50-3, through O.C.G.A. § 33-50-8, comprehensive licensing requirements are provided as well as the authority of the Commissioner of Insurance to examine the self-insurance plans. The licensing fee for a multiple employer self-insurance health plan is $400.00. O.C.G.A. § 33-8-1(N).

Under O.C.G.A. § 34-9-152, groups of municipalities, counties, school boards, hospital authorities or trade associations may contract together to furnish self-insurance for workers' compensation benefits to employees of its members. Such groups must apply for and obtain from the Commissioner of Insurance a certificate of authority to operate such funds. O.C.G.A. § 34-9-153. Under this Code Section, the Commissioner of Insurance examines the group's application, and if the group is found capable of meeting statutory and financial requirements, the Commissioner issues a certificate of authority.

These areas of self-insurance are regulated and receive licenses or certificates of authority from the Commissioner of Insurance, and therefore are regulated entities under O.C.G.A. § 21-5-30.1.

You also ask whether entities which are not insurance companies, but which provide services such as the indemnification services customarily provided by motor clubs would be regulated entities of the Commissioner of Insurance. These entities are not "regulated" under O.C.G.A. § 21-5-30.1 unless they receive a license or are otherwise legally subject to the control or affected by actions of the Commissioner of Insurance or the Department of Insurance. Your question indicates that neither of these criteria exist, and therefore such entities would not be regulated under the statute.

Prepared by:

Deputy Attorney General