Question

70. Which of the following selections correctly describes the California State Compensation Insurance Fund?

(Choose from the following options)
1. A state entity that exists to pay compensation if an employee is injured while working for an employer who is uninsured, and the employer fails to pay or post a bond to pay compensation due the employee
2. A state entity that exists solely to transact Workers Compensation Insurance on a nonprofit basis
3. A state entity that exists to protect policyholders against failure in the performance of Workers Compensation policies because of the impairment or insolvency of a member insurer that issued the policy
4. None of these correctly describe the California State Compensation Insurance Fund

Answer 1

The California State Compensation Insurance Fund is a state entity that exists to provide workers' compensation insurance on a nonprofit basis.

Step-by-step explanation:

The correct selection that describes the California State Compensation Insurance Fund is option 2: A state entity that exists solely to transact Workers Compensation Insurance on a nonprofit basis.

The California State Compensation Insurance Fund is a state entity that provides workers' compensation insurance to employers in California. It operates as a nonprofit organization and is the largest provider of workers' compensation insurance in the state.