Section 1004. Financial Responsibility and Security Requirements.--All administrators shall be required to maintain an errors and omissions insurance policy and also to maintain financial responsibility in the form of a fidelity bond or a clean irrevocable and unconditional and ever-green letter of credit or, as established by regulation, other form of security acceptable to the department. Financial responsibility shall be established and maintained each year in an amount equal to fifty per centum of the average amount of funds entrusted to the administrator by benefit plans for the preceding twelve months, but not to exceed five hundred thousand dollars ($500,000) for any plans other than multiple employer welfare arrangements.
(1004 added Dec. 12, 1994, P.L.1035, No.141)