40-246b. Excess coverage license to effect insurance or reinsurance in nonadmitted companies; application; fee; affidavit; records; revocation or suspension of license; agent authorized to place business with excess coverage licensees; required information. (a) Upon receipt of a proper application, the commissioner of insurance may issue an excess lines coverage license to any licensed property and casualty agent of this state or any other state. Any agent so licensed may negotiate for insureds whose home state is this state, the types of contracts of fire insurance enumerated in K.S.A. 40-901, and amendments thereto, and the type of casualty insurance contracts enumerated in K.S.A. 40-1102, and amendments thereto, or reinsurance, or to place risks, or to effect insurance or reinsurance for persons or corporations other than such agent, with insurers not authorized to do business in this state. An agent, as defined in K.S.A. 40-4902, and amendments thereto, may place the kind or kinds of business specified in this act for which such agent is licensed pursuant to K.S.A. 40-4903 and subsection (d) of 40-4906, and amendments thereto, with an insurer not authorized to do business in this state by placing such business with a person licensed pursuant to the provisions of this act and may share in the applicable commissions on such business. Before any such license shall be issued, the applicant shall submit proper application on a form prescribed by the commissioner, which application shall be accompanied by a fee of $50. Such license shall be renewable each year on May 1, upon the payment of a $50 fee.
(b) The agent so licensed shall on or before March 1 of each year, file with the insurance department of this state, a sworn affidavit or statement to the effect that, after diligent effort, such agent has been unable to secure the amount of insurance required to protect the property, person, or firm described in such agent's affidavit or statement from loss or damage in regularly admitted companies during the preceding year. Mere rate differential shall not be grounds for placing a particular risk in a nonadmitted carrier when an admitted carrier would accept such risk at a different rate. The licensed excess coverage agent must, prior to placing insurance with an insurer not authorized to do business in this state, obtain the written consent of the prospective named insured and provide such insured the following information in a form promulgated by the commissioner:
(1) A statement that the coverage will be obtained from an insurer not authorized to do business in this state;
(2) a statement that the insurer's name appears on the list of companies maintained by the commissioner pursuant to K.S.A. 40-246e, and amendments thereto;
(3) a notice that the insurer's financial condition, policy forms, rates and trade practices are not subject to the review or jurisdiction of the commissioner;
(4) a statement that the protection of the guaranty associations is not afforded to policyholders of the insurer; and
(5) a statement or notice with respect to any other information deemed necessary by the commissioner pertinent to insuring with an insurer not authorized to do business in this state.
(c) In the event the insured desires that coverage be bound with an insurer not admitted to this state and it is not possible to obtain the written consent of the insured prior to binding the coverage, the excess lines agent may bind the coverage after advising the insured of the information set out above and shall obtain written confirmation that the insured desires that coverage be placed with an insurer not admitted to this state within 30 days after binding coverage.
(d) When business comes to a licensed excess lines agent in which this state is the home state for placement with an insurer not authorized to do business in this state from an agent not licensed as an excess lines agent, it shall be the responsibility of the licensed excess lines agent to ascertain that the insured has been provided the preceding information and has consented to being insured with an insurer not authorized to do business in this state. Each excess lines agent shall keep a separate record book in such agent's office showing the transactions of fire and casualty insurance and reinsurance placed in companies not authorized to do business in this state, the amount of gross premiums charged thereon, the insurer with which the policy was placed, the date, term and number of the policy, the location and nature of the risk, the name of the insured and such other information as the commissioner may require and such record shall be available at all times for inspection by the commissioner of insurance or the commissioner's authorized representatives. The commissioner may revoke or suspend any license issued pursuant to the provisions of this act in the same manner and for the same reasons prescribed by K.S.A. 40-4909, and amendments thereto.
Any policy issued under the provisions of this statute shall have stamped or endorsed in a prominent manner thereon, the following: This policy is issued by an insurer not authorized to do business in Kansas and, as such, the form, financial condition and rates are not subject to review by the commissioner of insurance and the insured is not protected by any guaranty fund.
If business is placed with a nonadmitted company that is subsequently determined to be insolvent, the excess lines agent placing such business with such company is relieved of any responsibility to the insured as it relates to such insolvency, if the excess lines agent has satisfactorily complied with all requirements of this section pertaining to notification of the insured, has properly obtained the written consent of the insured and has used due diligence in selecting the insurer. It shall be presumed that due diligence was used in selecting the insurer if such insurer was on the list compiled pursuant to K.S.A. 40-246e, and amendments thereto, at the time coverage first became effective.
History: L. 1955, ch. 242, § 1; L. 1975, ch. 242, § 1; L. 1982, ch. 198, § 1; L. 1996, ch. 45, § 3; L. 2004, ch. 159, § 2; L. 2011, ch. 61, § 8; May 19.
Structure Kansas Statutes
Article 2 - General Provisions
40-201 Insurance company defined.
40-201a Service contract; definitions; exemption from regulation.
40-202 Code inapplicable to certain lodges, societies, persons and associations.
40-203 Name of company or society; submission of name to commissioner.
40-204 Unlawful to offer stock for sale without permit from commissioner; void shares, when.
40-205b Denial of application to sell stock as agent; hearing.
40-205c Revocation of agent's license; hearing.
40-205d Appeal of commission's decision.
40-207 Secretary and certain officers to give bond.
40-208 Examination by commissioner before issuance of certificate.
40-209b Same; act supplemental.
40-210 Foreign companies outside United States; permission to transact business; assets; condition.
40-211 Amount of deposit of foreign company outside United States.
40-212 Credit for reinsured risks.
40-213 Unlawful transfer of premium notes.
40-215 Duration of licenses and certificates.
40-217 Contents of policies of foreign company.
40-219 Failure of company to pay judgment.
40-220 Action against insurance company to be brought in this state; injunction.
40-221a Reinsurance of risks of and by Kansas companies; procedure; requirements.
40-221b Reinsurance of risks of and by Kansas companies; procedure; requirements; definitions.
40-222a Examination of corporations organizing domestic insurance companies.
40-222c Same; insurance company defined.
40-222d Same; company deemed to be in hazardous financial condition, when.
40-222e Same; suspension, revocation or refusal to renew certificate.
40-222f Examination of condition of company; definitions.
40-223 Fees for examinations; compensation and expenses for examiners.
40-223a Insurance company annual statement examination fund established; purpose.
40-223b Same; compensation and expenses of examiners.
40-223c Same; duties of commissioner; warrants of director of accounts and reports.
40-223d Same; insufficiency of fund; transfer from general fund, limitation; files.
40-223f Same; compensation and expenses of persons receiving training.
40-223g Same; payments from revolving fund.
40-223h Property and casualty actuarial opinion letter law; citation of act.
40-223i Same; actuarial opinion, contents; procedure.
40-223j Same; authority of commissioner; rules and regulations.
40-224 When disbursements to be made only on voucher or affidavit.
40-229 Valuation of securities.
40-230a Deposit of securities purchased from sale of stock during organization period.
40-231 Dealing in goods, wares and merchandise prohibited; exceptions.
40-232 Sale of stock with insurance.
40-233 Dividends, interest or bonus; payment from earned surplus.
40-234a Reserves required for accident and health policies; unearned premium reserves.
40-234b Unearned premium reserves required for domestic title insurance companies.
40-234c Unearned premium reserves required of foreign title insurance company.
40-236 Statements made with intent to injure company.
40-237 Contracts and promissory notes by minors.
40-238 Resident general agents of foreign companies.
40-239 Definition; insurance agent.
40-240g Rules and regulations.
40-241h Waiver of examination in certain cases.
40-241j Annual report of agents contracted with and payment of certification fees; audit.
40-241k Rules and regulations; establishing fees for agents.
40-244 Representations without complying with code.
40-246a Penalties for violating 40-246; hearings.
40-246c Same; accounting of gross premiums and tax thereon; penalty.
40-246d Same; revocation or suspension of license, when.
40-246g Surplus lines producer; exempt commercial purchaser.
40-246h Commissioner; rules and regulations.
40-247 Insurance agent or broker failing to pay premium to company; penalty.
40-248 Discontinuance of business.
40-249 Policies to be issued within two years.
40-250 Companies subject to act.
40-251 Insurance commissioner; legal representation; judicial review of actions.
40-252c Same; credits; definitions.
40-252d Credit against premium tax for salaries paid to Kansas employees.
40-252e Small insurance company credit against premium tax.
40-252g Same; expiration of act.
40-253 Payment of fees and taxes in other states by Kansas companies; retaliatory measures, when.
40-253a Same; effect of certain tax credits.
40-256 Attorney fees in actions on insurance policies; exception.
40-257 Invalidity of code of 1927.
40-258 Actions to recover death benefits based on certain policies; distribution.
40-259 Continuity of management of domestic companies in national emergency; declaration of purpose.
40-260 Same; adoption of emergency bylaws; effect.
40-261 Same; effective provisions of law if emergency bylaws not adopted at time emergency occurs.
40-262 Same; succession national emergency lists; basis; conditions.
40-263 Same; home or principal office; alternate locations.
40-266 Unlawful acts in connection with sale of equity securities.
40-267 Provisions of 40-265, 40-266 inapplicable to certain sales; rules and regulations.
40-268 Provisions of 40-264 to 40-266 inapplicable to arbitrage transactions; exception.
40-269 Equity security defined.
40-270 Provisions of 40-264 to 40-266 inapplicable to equity securities of domestic companies, when.
40-271 Rules and regulations by commissioner.
40-272 Same; proxies, consents or authorization concerning securities of domestic companies.
40-273 Joint underwriting and joint reinsurance; filing requirements; changes; prohibitions.
40-274 Same; solicitation; countersignature requirements.
40-276 Cancellation of automobile liability insurance; definitions.
40-276a Automobile liability insurance policies; denial of renewal; notice; conditions; exceptions.
40-277 Same; limitations on policy conditions for cancellation.
40-281 Hearings by commissioner on any matter relating to insurance; procedure; subpoena.
40-283 Same; interest not subject to certain provisions.
40-285 Same; uninsured motor vehicle includes vehicle whose insurer is insolvent.
40-286 Same; extent of insurer's insolvency protection.
40-287 Same; subrogation rights.
40-288 Same; provisions of article 22 of chapter 40 not required.
40-296 Same; offer of insurance by one of group of affiliated insurors, effect.
40-297 Same; group of affiliated insurors defined.
40-298 Sale of insurance in connection with sale and financing of automobile; definitions.
40-2,103 Application of designated statutes.
40-2,105b Same; insurance coverage for psychotherapeutic drugs used for treatment of mental illness.
40-2,108 Same; rules and regulations by commissioner.
40-2,109 Mental or physical handicaps; rate discrimination prohibited; enforcement.
40-2,110 Reporting fire losses; rules and regulations; report forms.
40-2,113 Nonliability for information relating to adverse underwriting decision.
40-2,115 Liability insurance coverage for punitive damages assessed against certain persons.
40-2,117 Provision of health services by professional provider; allowable charges.
40-2,119 Same; immunity from civil liability for certain persons.
40-2,120 Business or professional property or casualty insurance; cancellation, when.
40-2,121 Same; nonrenewal; notice required.
40-2,122 Cancellation or nonrenewal of policy; written explanation required.
40-2,123 Insurers authorized to discontinue certain business in state, when; enforcement.
40-2,126 Interest due on insurance settlements, when.
40-2,127 Same; application to multiple payments.
40-2,128 Same; rules and regulations.
40-2,129 Managing general agents; title of act.
40-2,131 Same; licensure requirements; bond.
40-2,133 Same; utilization by insurer; acts required to be performed by and prohibitions on insurer.
40-2,134 Same; acts deemed to be acts of insurer; examination.
40-2,136 Same; rules and regulations.
40-2,137 Assessment of costs of certain administrative hearings, guidelines, procedure.
40-2,153 Insurance coverage to allow choice of pharmacy providers.
40-2,154 Medicaid eligibility and coverage; prohibitions.
40-2,155 Motor vehicle glass replacement; prohibitions; rights of the insured.
40-2,159 Reports on a nonconsolidated basis; exception.
40-2,160 Coverage for minimum inpatient care following birth of child.
40-2,161 Coverage for children in the custody of the commissioner of juvenile justice.
40-2,164 Coverage of prostate cancer screening.
40-2,165 Coverage of general anesthesia in conjunction with dental care for certain individuals.
40-2,166 Coverage of reconstructive breast surgery.
40-2,166a Coverage for osteoporosis.
40-2,167 Off-label use of prescription drugs; definitions.
40-2,168 Same; coverage for cancer treatment; exclusion from coverage prohibited.
40-2,169 Same; commissioner of insurance, powers.
40-2,170 Same; coverage not affected, when.
40-2,184 Coverage for orally administered anticancer medication.
40-2,185 Dental health insurance; fee setting provision, limitation on.
40-2,190 Abortion coverage; separate coverage; when required.
40-2,191 Same; severability clause.
40-2,192 Mandate lite health benefit plan act.
40-2,193 Specially designed policies; short-term policies.
40-2,194 Coverage for autism spectrum disorder.
40-2,195 Exclusive provider organization policy; requirements; exceptions; definitions.
40-2,201 Property and casualty insurance; group affiliated insurers; renewal of policy.
40-2,202 Same; limited lines; self-service storage units.
40-2,203 CGAD report required; contents; filing; rules and regulations.
40-2,210 Kansas telemedicine act; citation.
40-2,212 Same; confidentiality.
40-2,213 Same; application of; coverage parity established.
40-2,214 Same; prescribing of drugs via telemedicine.
40-2,215 Same; abortions delivered via telemedicine not authorized.