The Second Injury Fund (SIF) is a dedicated fund for the purpose of reimbursing compensation payments made by employers, or their insurers or adjusters, to certain injured employees. For Fiscal Year 1998, the SIF distributed $2,211,256 on behalf of 120 claimants.

SIF revenue is collected from each insurer, adjuster, and uninsured employer every March 1^st, when they file their annual reports. Annual compensation payments for temporary partial disability, temporary total disability, permanent partial impairment, and permanent total disability are calculated for each claim. Up to 6% of each claim’s annual total is collected by the SIF administrator and deposited into the Second Injury Fund Account. For Fiscal Year 1998, the SIF collected $2,464,099 in contributions from insurers and adjusters.

To receive reimbursement, the employer must demonstrate that the employee had a qualifying pre-existing condition, that the employee was hired or retained with full knowledge of this condition, that a subsequent injury when combined with the pre-existing condition resulted in a condition substantially greater than the subsequent injury alone, and that 104 weeks of compensation payments have been made.

A word of caution. It is extremely important that employers understand the limitations on what questions they can ask potential employees during the interview process. Generally speaking, the Americans with Disabilities Act strictly limits inquiries to conditions related to specific job duties and functions. An employer may however, have a newly hired employee complete a health questionnaire in order to determine if there are any pre-existing conditions which might result in a SIF reimbursable injury at a later date. Nevertheless, since this is a sensitive legal area, employers are strongly encouraged to seek the advice of an attorney or a professionally trained human resource manager.

If an employer believes that a compensable injury is entitled to SIF reimbursement, the employer must file a Notice of Possible Claim Against the Second Injury Fund, Form 07-6110, within 100 weeks of the injury date. After the notice has been filed, and 104 weeks of compensation have been paid, the employer may file a Petition to Join Second Injury Fund and Claim for Reimbursement, Form 07-6109.

If all conditions for reimbursement have been met, the SIF Administrator will direct the petitioner to submit to the Alaska Workers' Compensation Board a Stipulation of Facts in legal memorandum form to be approved without oral hearing. If there is a dispute of fact, the Board will schedule a pre-hearing upon receipt of a statement of readiness to proceed.

Once SIF reimbursement has been authorized, the employer or its insurer may receive monthly payments upon written proof of compensation paid. If the employer or insurer has paid a large single disbursement, such as Permanent Partial Impairment or in response to a settlement (Compromise and Release), reimbursement will be made in monthly installments over time. Alaska statutes prohibit lump sum reimbursements from the Second Injury Fund.