Which term best describes the body that governs the self-insurer's security fund?

Which term best describes the body that governs the self-insurer's security fund?

• A. Directors
• B. Administrators
• C. Trustees
• D. Auditors

Answer: (C)

Trustees are the ones who hold and manage the self-insurer’s security fund in trust, with fiduciary duties to protect the assets and ensure there are sufficient funds to satisfy claims. In a California self-insurance plan, the security fund isn’t simply owned by the employer; a board of trustees oversees contributions, investments, and disbursements, and ensures compliance with regulatory rules. This setup provides independent oversight focused on safeguarding the fund for the benefit of claimants and the regulatory system. Directors oversee the sponsoring entity, administrators handle daily operations, and auditors review finances, but they do not govern the fund itself in the same fiduciary sense that trustees do.

Trustees are the ones who hold and manage the self-insurer’s security fund in trust, with fiduciary duties to protect the assets and ensure there are sufficient funds to satisfy claims. In a California self-insurance plan, the security fund isn’t simply owned by the employer; a board of trustees oversees contributions, investments, and disbursements, and ensures compliance with regulatory rules. This setup provides independent oversight focused on safeguarding the fund for the benefit of claimants and the regulatory system. Directors oversee the sponsoring entity, administrators handle daily operations, and auditors review finances, but they do not govern the fund itself in the same fiduciary sense that trustees do.