The State Fund Board of Directors declared an approximate $39 million EAP dividend for qualifying policyholders with policies that took effect between August 27, 2020 and December 31,2020. This dividend is approximately 10 percent of the estimated annual premium (EAP) reported during this time period. The total EAP dividend declarations for the 2020 policy year are approximately $114 million.
Policyholders were notified about the declaration via email during the first week of January 2021. The eligibility requirements to receive a 2020 EAP Dividend are:
- Have a policy that took effect between January 1, 2020 and Dec. 31, 2020.
- Have not had your 2020 policy cancelled for cause prior to expiration.
- Have cooperated with final audit (if required) and final bill has been paid in full for 2020 policy.
Payment of the 2020 EAP dividend for eligible policies will begin 18 months after policy inception, which means payments will start in July 2021. Policyholders will receive a Policyholder Dividend Statement that explains whether or not they have been deemed eligible for a dividend. Eligible policyholders will receive a dividend check with the Policyholder Dividend Statement.
The State Fund Board of Directors also declared a 5 percent Large Account Safety Dividend (LASD) for qualifying policyholders with policies that took effect between November 19, 2020 and December 31, 2020. Policyholders with Standard Premium of $500,000 or greater at date of policy inception (irrespective of whether the premium level changes during the policy term) may qualify for this dividend if they meet all the eligibility criteria. This follows our declaration in November of an LASD for qualifying policyholders with policies that took effect between January 1, 2020 and November 18, 2020.
If you have any questions about the 2020 EAP Dividend or the Large Account Safety Dividend, we encourage you to reach out to your State Fund Marketing Representative.
Disclaimer: Under California law it is unlawful for an insurer to promise the future payment of dividends under an unexpired workers’ compensation insurance policy or to misrepresent the conditions for dividend payment. Dividends are payable only pursuant to conditions determined by the Board of Directors or other governing board of the Company following policy expiration. It is a misdemeanor for any insurer or officer or agent thereof, or any insurance broker or solicitor, to promise the payment of future workers’ compensation dividends. Past dividend performance is no guarantee of an insurer’s future dividend performance.