§ 396. Employer not liable for payment of benefits. Neither the
state, nor state university, nor any electing employer or its local
sponsor shall be a party to any contract purchased in whole or in part
with contributions made under the optional retirement program
established and administered pursuant to this article. No retirement,
death, or other benefits shall be payable by the state, or by state
university, or by any electing employer or its local sponsor under such
optional retirement program. Such benefits shall be paid to electing
employees or their beneficiaries by the designated insurer or insurers
in accordance with the terms of their contracts.