In a scathing report released this week, California Department of Insurance Commissioner Steve Poizner slammed the state's workers' compensation fund -- known as State Fund -- stating that the organization contained "serious structural and operational issues."

Created by the California Legislature in 1914, State Fund describes itself as "a nonprofit, self-supporting, fairly competitive public enterprise that guarantees a permanent workers' compensation insurance marketplace for California employers." It has approximately 220,000 policyholders.

The review marks the culmination of an intensive review and investigation that began back in the spring of 2007. Ordered by Commissioner Poizner, the audit included both an operational review and a financial examination. It looked at governance and management practices, group association programs, information technology, district offices and claim processing centers -- including an initial operational review of four district offices and three claim processing centers-- and business services.

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