1. (a) The director shall audit and inspect self-insurers as frequently as necessary to assure compliance with the Act and commission rules, but shall audit and inspect each self-insurer at least once every three years.

2. (b) An audit may include, but not be limited to:

   1. (1) any representation made on an initial or renewal application;
   2. (2) payroll and classification;
   3. (3) loss history;
   4. (4) claims administration;
   5. (5) loss reserve;
   6. (6) safety programs;
   7. (7) interviews of the self-insurer, their agents, or employees regarding any matter within their knowledge and pertaining to the obligations of the self-insurer under the Act or commission rules; and
   8. (8) any other issue deemed appropriate by the director.
3. (c) A written report shall be provided to the self-insurer within 30 days after the audit is completed.

4. (d) Unreasonable refusal to make the required information available constitutes:

   1. (1) grounds for revocation of the certificate; and
   2. (2) a Class A administrative violation, with each day of noncompliance constituting a separate violation.

Source Note:The provisions of this §114.11 adopted to be effective January 1, 1993, 17 TexReg 7896.