Cover Right Roofing, Inc. v. State Compensation Ins. Fund

FACTS AND PROCEDURAL HISTORY

A. State Fund’s Premiums This appeal concerns a particular rate known as a “base rate,” which State Fund uses to calculate premiums for its insureds. The material facts are undisputed. State Fund is a quasi-governmental entity that provides workers’ compensation insurance. (Stevens v. Workers’ Comp. Appeals Bd. (2015) 241 Cal.App.4th 1074, 1088, fn. 11.) It was “created in 1914 as a public enterprise fund and [is] subject to the jurisdiction and control of the state Insurance Commissioner.” (Notrica v. State Compensation Ins. Fund (1999) 70 Cal.App.4th 911, 918.) “State Fund ‘is at

1 All further undesignated statutory references are to the Insurance Code.

2 once both an agency of the state and an insurance carrier. In these two roles, it is self- operating and of a special and unique character.’” (California Attorneys, etc. v. Brown (2011) 195 Cal.App.4th 119, 124.) State Fund calculates an estimated premium for its policies by multiplying the insured’s estimated payroll by an interim billing rate and dividing the result by 100. The insured makes payments based on the estimated premium throughout the policy’s life. Once the policy ends, State Fund…