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Ken Stabler sustained an industrial injury to multiple body parts while employed as a professional football player. He was employed by the Oakland Raiders, Houston Oilers, and New Orleans Saints during the cumulative trauma period.

Benefits were awarded against the Saints and Travelers. After Stabler passed away, Travelers and his estate settled the previously awarded benefits.

Travelers insured the Saints prior to Stabler’s last year of injurious exposure and they were held liable for his benefits pursuant to Labor Code section 5500.5.

Travelers alleged that the Saints were unlawfully uninsured during his last year of injurious exposure. The Saints allege that they were covered by North-West Insurance Company and by Horizon Insurance Company, but the Saints were unable to locate the alleged North-West policy and there is no North-West policy in evidence. North-West Insurance Company was liquidated by the Oregon Insurance Guaranty Association in 1999.

Travelers filed a Petition for Reimbursement seeking reimbursement of $87, 083.53 for benefits paid from the Saints, based on Labor Codes section 5500.5.

After a trial primarily focused on the issue of whether the Saints were unlawfully uninsured, the WCJ found that substantial evidence did not show that the Saints were covered by a workers’ compensation policy issued by North West. And that the Saints did have workers compensation coverage, which included coverage in California with First Horizon Insurance Company and thus the Saints were not unlawfully uninsured during the last year of injurious exposure.

Reconsideration was granted, and the WCAB panel found that the Saints were illegally uninsured and ordered the Saints to reimburse Travelers in the panel decision of Ken Stabler v Louisiana Saints et. al. ADJ7762424 (May 2022) .

Travelers contends that the First Horizon policy did not provide workers’ compensation coverage because First Horizon was not licensed by the California Department of Insurance to issue policies. Travelers also argues that by the terms of the First Horizon policy, including the “All States Endorsement,” the policy does not provide workers’ compensation insurance in any state except Louisiana.

Workers’ compensation insurance policies in California are subject to regulation by the Department of Insurance. All workers’ compensation policies must “contain a clause to the effect that the insurer will be directly and primarily liable to any proper claimant for payment of …compensation.”

First Horizon agreed to be directly and primarily responsible for providing benefits to applicants under the laws of the state of Louisiana. (“Coverage A”) Unlike “Coverage A,” the “All States Endorsement” is an agreement that Horizon will reimburse the employer for liability imposed on the employer under the workers’compensation laws of states other than Louisiana.

The Saints could obtain reimbursement from First Horizon for California claims but the insurance agreement does not require First Horizon to directly pay benefits to a California applicant.

The coverage provided for California claims is similar to an excess policy – First Horizon promises reimbursement not payment. Thus, the Saints did not secure the payment of compensation as required by Section 3700 and they were illegally uninsured.