Kansas Statutes
Article 7 - Fraternal Benefit Societies
40-745 Personal liability of supreme governing body officers and members; indemnification and reimbursement for expenses and liabilities of directors, officers, employees and agents of society and other entities; liability insurance.

40-745. Personal liability of supreme governing body officers and members; indemnification and reimbursement for expenses and liabilities of directors, officers, employees and agents of society and other entities; liability insurance. (a) The officers and members of the supreme governing body or any subordinate body of a society shall not be personally liable for any benefits provided by a society.
(b) Any person may be indemnified and reimbursed by any society for expenses reasonably incurred by, and liabilities imposed upon, such person in connection with or arising out of any action, suit or proceeding, whether civil, criminal, administrative or investigative, or threat thereof, in which the person may be involved by reason of the fact that such person is or was a director, officer, employee or agent of the society or of any firm, corporation or organization which such person served in any capacity at the request of the society. A person shall not be so indemnified or reimbursed (1) in relation to any matter in such action, suit or proceeding as to which such person shall finally be adjudged to be or have been guilty of breach of a duty as a director, officer, employee or agent of the society or (2) in relation to any matter in such action, suit or proceeding, or threat thereof, which has been made the subject of a compromise settlement, unless in either such case the person acted in good faith for a purpose the person reasonably believed to be in or not opposed to the best interests of the society and, in a criminal action or proceeding, in addition, had no reasonable cause to believe that such conduct was unlawful. The determination whether the conduct of such person met the standard required in order to justify indemnification and reimbursement in relation to any matter described in subpoints (1) or (2) of the preceding sentence may only be made by the supreme governing body or board of directors by a majority vote of a quorum consisting of persons who were not parties to such action, suit or proceeding or by a court of competent jurisdiction. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of no contest, as to such person shall not in itself create a conclusive presumption that the person did not meet the standard of conduct required in order to justify indemnification and reimbursement. The foregoing right of indemnification and reimbursement shall not be exclusive of other rights to which such person may be entitled as a matter of law and shall inure to the benefit of such person's heirs, executors and administrators.
(c) A society shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the society, or who is or was serving at the request of the society as a director, officer, employee or agent of any other firm, corporation or organization against any liability asserted against such person and incurred by such person in any such capacity or arising out of such person's status as such, whether or not the society would have the power to indemnify the person against such liability under this section.
History: L. 1988, ch. 154, ยง 8; Jan. 1, 1989.

Structure Kansas Statutes

Kansas Statutes

Chapter 40 - Insurance

Article 7 - Fraternal Benefit Societies

40-738 Definitions.

40-739 Operation on lodge system; subordinate lodges required to hold regular meetings; lodges for children.

40-740 Representative form of government; election and voting criteria.

40-741 Definitions.

40-742 Operation for benefit of members; authorized insurance business and purposes; specification of persons who may be covered; adoption of laws and rules governing society's operation.

40-743 Laws and rules; provisions relating to membership to be specified.

40-744 Location of principal office; supreme governing body, location of meetings, minutes of proceedings; official publication for notices; mailings; grievance or complaint procedures.

40-745 Personal liability of supreme governing body officers and members; indemnification and reimbursement for expenses and liabilities of directors, officers, employees and agents of society and other entities; liability insurance.

40-746 Society's laws nonwaivable by subordinate bodies, officers or members.

40-747 Beneficiary designations; payment of funeral benefits to persons incurring expense therefor; payment of proceeds when no lawful beneficiary.

40-748 Benefits not subject to attachment, garnishment or process.

40-749 Benefit contracts; certificate to be issued to owners; statements on application representations; effect of amendments to society's laws; contracts on lives of minors; impairment of reserves; copies of documents to be received as evidence; cer...

40-750 Valuation of paid-up nonforfeiture benefits, cash surrender values and loan or other options.

40-751 Investment of funds.

40-752 Holding of assets; creation of special funds; establishment of separate accounts; issuance of contracts on variable basis.

40-753 Insurance laws application to societies.

40-754 Standards of valuation for certificates; mortality tables; maintenance of reserves in excess of those required.

40-755 Annual statement to include valuation of certificates in force; certification or verification of actuary.

40-756 Licenses continued in force upon payment of fees; certified copy of license prima facie evidence licensee is society.

40-757 Examinations; notice and opportunity to respond; payment of expenses.

40-758 Foreign and alien societies to procure license to transact business in state; filing and other requirements.

40-759 Deficiencies in operation by domestic society; notice to correct; show cause requirement upon failure to correct; injunction or quo warranto action by attorney general; recommencement of business; liquidation; receiver; procedures applicable t...

40-760 Deficiencies in operation by foreign or alien society; notice to correct; show cause requirement upon failure to correct; suspension, revocation or refusal of authority to do business; certain contracts authorized to be continued.

40-761 Application or petition for injunction required to be made by attorney general on request of commissioner.

40-762 Agents, licensing, certification and examination; exemption therefrom for certain agents, representatives and members; society to maintain record of exempted representatives; information thereof and of change of exempt status to be furnished t...

40-763 Societies and agents subject to law regulating trade practices; construction and application thereof.

40-764 Formation requirements; incorporators; articles of incorporation; documents to be filed with commissioner; bond; preliminary certificate of authority, expiration; solicitation of members upon receipt of preliminary certificate; conditions prec...

40-765 Amendment of domestic society's laws; procedures; approval by commissioner; amendments or synopsis thereof to be furnished to members; amendments and additions to be furnished to commissioner; printed copies prima facie evidence of legal adopt...

40-766 Establishment and operation of not for profit institutions to further purposes of society; compensation for institutions' services; annual statement to include property held for such purposes.

40-767 Reinsurance; limitations; credit for reserves on ceded risks.

40-768 Consolidation or merger of domestic society; documents and evidence to be filed with commissioner; approval of commissioner; effective date; societies incorporated under laws of foreign state; transfer of rights and property to society resulti...

40-769 Conversion of society into mutual or stock life insurance company.

40-770 Same; submission of proposal to supreme legislative body; notice to be furnished members and policyholders; meeting of subordinate lodges or branches on proposal; election of delegates to supreme legislative body; approval of plan by commissio...

40-771 Same; adoption of resolution by delegates to supreme legislative body; certificate to be filed with commissioner by directors of society; contents.

40-772 Same; report of meeting to be filed with commissioner.

40-773 Same; conversion into stock company; purchase of stock; notice to members or policyholders of right to purchase; preference; limitation; nonmembers of society.

40-774 Same; status of corporation upon conversion; reserves on policies issued prior to conversion; succession to rights and property of society; power of commissioner to order divestiture or revaluation.

40-775 Same; preservation of rights of members, policyholders and creditors of society as obligations of new corporation; appointment of commissioner as process agent.

40-776 Same; obligation of new corporation to perform obligations of society; preservation of pending legal actions.

40-777 Appointment of commissioner as process agent; time for society to file pleadings after receiving copy of notice.

40-778 Review of commissioner's decisions.

40-779 Penalties for violations.

40-780 Application of act to exempted societies and organizations; information required by commissioner.

40-781 Rules and regulations.

40-782 Severability of act.