Kan. Stat. § 40-2903

Current through 2024 Session Acts Chapter 111

Section 40-2903 - [Effective 7/1/2024] Same; definitions

As used in this act:

(a) "Association" means the Kansas insurance guaranty association created by this act.

(b) "Commissioner" means the commissioner of insurance of Kansas.

(c) "Covered claim" includes the following:

(1) An unpaid claim, including one for unearned premiums, that arises out of and is within the coverage and not in excess of the applicable limits of an insurance policy to which this act applies issued by an insurer, if such insurer becomes an insolvent insurer after the effective date of this act and:

(A) The claimant or insured is a resident of this state at the time of the insured event. For entities other than an individual, the residence of a claimant, insured or policyholder is the state in which the principal place of business of such claimant, insured or policyholder is located at the time of the insured events; or

(B) the claim is a first party claim for damage to property that is permanently located in this state.

(2) "Covered claim" includes claim obligations that arose through the issuance of an insurance policy by a member insurer, which are later allocated, transferred, merged into, novated, assumed by or otherwise made the sole responsibility of a member or nonmember insurer if:

(A) The original member insurer has no remaining obligation on the policy after the transfer;

(B) a final order of liquidation with a finding of insolvency has been entered against the insurer that assumed the member's coverage obligations by a court of competent jurisdiction in the insurer's state of domicile;

(C) the claim would have been a covered claim, as defined in subsection (c)(l), if the claim had remained the responsibility of the original member insurer and the order of liquidation had been entered against the original member insurer with the same claim submission date and liquidation date; and

(D) in cases where the member's coverage obligations were assumed by a nonmember insurer, the transaction received prior regulatory or judicial approval.

(3) "Covered claim" does not include:

(A) Any amount due any reinsurer, insurer, insurance pool or underwriting association as subrogation recoveries or otherwise;

(B) any amount awarded as punitive or exemplary damages unless such damages were covered under the policy of the insolvent insurer; or

(C) any claim by an affiliate of the insolvent insurer.

(d) "Domiciliary state" means:

(1) The state in which an insurer is incorporated or organized; or

(2) in the case of an alien insurer, the state of entry of such insurer.

(e) "Insolvent insurer" means:

(1) An insurer licensed by the commissioner to transact insurance in this state either at the time the policy was issued or when the insured event occurred; and

(2) determined to be insolvent by a court of competent jurisdiction and against whom a final order of liquidation has been entered by a court of competent jurisdiction in the insurer's domiciliary state.

(f) "Member insurer" means any person who is:

(1) Authorized to write any kind of insurance to which this act applies under K.S.A. 40-2902, and amendments thereto, including the exchange of reciprocal or inter-insurance contracts; and

(2) licensed by the commissioner to transact insurance in this state. This act shall not apply to those persons transacting business pursuant to the provisions of K.S.A. 40-202, and amendments thereto.

(g) "Net direct written premiums" means first gross premiums written in this state on insurance policies to which this act applies, less return premiums thereon and dividends paid or credited to policyholders on such direct business. "Net direct written premiums" does not include premiums on contracts between insurers or reinsurers.

(h) "Person" means any individual, corporation, partnership, association or voluntary organization.

(i) "Cybersecurity insurance," for purposes of this act, includes first and third-party coverage, in a policy or endorsement, written on a direct, admitted basis for losses and loss mitigation arising out of or relating to data privacy breaches, unauthorized information network security intrusions, computer viruses, ransomware, cyber extortion, identity theft and similar exposures.

K.S.A. 40-2903

Amended by L. 2024, ch. 74,§ 2, eff. 7/1/2024.

L. 1970, ch. 185, § 3; L. 2005, ch. 92, § 1; L. 2006, ch. 122, § 2; July 1.

This section is set out more than once due to postponed, multiple, or conflicting amendments.