“Eman really knows his stuff and we were very pleased with our end result.”
Myretta & Thomas Knorr
✦ Certified Specialist in Workers’ Compensation Law — Certified by the State Bar of California, Board of Legal Specialization ✦
Serving injured workers across California. Board-certified specialist; no fee unless we win.
By Eman Yazdchi, Esq. · Certified Specialist in Workers' Compensation Law, State Bar of California Board of Legal Specialization
In California, Labor Code section 3700.3 governs the California employer self-insurance certification process. The section 3700.3 California rule lets a financially qualified California employer satisfy the §3700 workers' compensation coverage requirement by self-insuring rather than purchasing insurance from an authorized carrier.
California Labor Code section 3700.3 governs how a California employer obtains certification from the California Department of Industrial Relations to self-insure workers' compensation obligations rather than satisfy California Labor Code §3700 California through an authorized insurance carrier. Under section 3700.3, a California employer seeking self-insurance certification must demonstrate substantial financial capacity, post security in the form of cash deposit or surety bond, agree to annual financial and claims audits, and accept ongoing regulatory oversight by the California Office of Self-Insurance Plans. The section 3700.3 California self-insurance route is generally available only to large California employers with substantial assets and predictable claims experience; small California employers are practically limited to the carrier-insurance pathway under California Labor Code §3700 California.
Under California Labor Code section 3700.3, a California employer seeking self-insurance certification must demonstrate substantial financial qualification — typically net worth, current assets, and stable cash flow sufficient to satisfy expected workers' compensation claims for the certification period. The section 3700.3 California Office of Self-Insurance Plans reviews audited financial statements, claims history, and operational stability before issuing or renewing certification. The section 3700.3 California rule generally requires the California employer to maintain a minimum security deposit (cash or surety bond) calibrated to the employer's estimated outstanding claim liabilities; the deposit can run into millions of dollars for large California self-insured employers with substantial claims inventories.
Under California Labor Code section 3700.3, the California self-insured employer must post a security deposit — typically a surety bond or cash equivalent — to secure payment of comp obligations even if the California employer subsequently becomes financially distressed. The section 3700.3 California security amount is recalculated annually based on the California employer's outstanding claim reserves; the California Office of Self-Insurance Plans audits the claim reserves to ensure they are adequate. The section 3700.3 California rule treats the security deposit as the first source of recovery for California injured workers when a self-insured employer becomes insolvent or otherwise fails to pay; the California Labor Code section 3700.1 California UEBTF is the backstop when the section 3700.3 California security is exhausted.
Under California Labor Code section 3700.3, the California self-insurance certification can be issued to individual California employers, to groups of related California employers (pooled self-insurance), and to California joint-powers authorities or public-entity risk pools. The section 3700.3 California group self-insurance lets smaller California employers pool risk and share the regulatory burden; the section 3700.3 California public-entity pathway is the dominant model for California cities, counties, school districts, and special districts. Each section 3700.3 California group or pool must satisfy aggregate financial qualifications and post security calibrated to the aggregate exposure of the participating California employers.
Under California Labor Code section 3700.3 (self-insurance certification), California Labor Code §3700 (general coverage requirement), California Labor Code §3700.5 (criminal misdemeanor for failure to insure), and California Labor Code section 3700.1 (UEBTF backstop), the California employer coverage framework operates as a multi-route system. California Labor Code §3700 California requires every California employer to provide workers' compensation coverage; section 3700.3 California allows large California employers to self-insure instead of buying insurance from a carrier; California Labor Code §3700.5 California criminalizes failure to do either; and California Labor Code section 3700.1 California UEBTF pays benefits when a California employer fails its California Labor Code §3700 obligation entirely. The four California sections together build the California coverage system.
Injured at work? Call (661) 273-1780
Tap to call →Last reviewed by Eman Yazdchi, Esq., May 2026.
Ready to discuss your case? Schedule a free consultation.
Schedule Free ConsultationRead more testimonials →“Eman really knows his stuff and we were very pleased with our end result.”