Which item is not accepted by the director as a deposit to secure incurred liabilities for payment of compensation and performance of obligations to a self-insured employer?

Which item is not accepted by the director as a deposit to secure incurred liabilities for payment of compensation and performance of obligations to a self-insured employer?

• A. Certificate of Deposit
• B. Cash, Securities, and Surety Bond
• C. Real Property
• D. Personal Property

Answer: (A)

Deposits used to secure incurred liabilities must be readily available to cover workers’ compensation payments and other obligations. The director generally accepts deposits in cash, securities, and a surety bond, and may also accept real property or personal property as collateral. A certificate of deposit is not accepted because, although it is a bank instrument, it is a time deposit that cannot be drawn upon immediately without penalties and may not be readily available to satisfy liabilities when needed. In contrast, cash is immediately usable, securities can be liquidated, and bonds or property can be converted to value to meet obligations. Therefore, a certificate of deposit is the one not accepted.

Deposits used to secure incurred liabilities must be readily available to cover workers’ compensation payments and other obligations. The director generally accepts deposits in cash, securities, and a surety bond, and may also accept real property or personal property as collateral. A certificate of deposit is not accepted because, although it is a bank instrument, it is a time deposit that cannot be drawn upon immediately without penalties and may not be readily available to satisfy liabilities when needed. In contrast, cash is immediately usable, securities can be liquidated, and bonds or property can be converted to value to meet obligations. Therefore, a certificate of deposit is the one not accepted.