Session of 2024
HOUSE BILL No. 2533
By Committee on Insurance
Requested by Eric Turek on behalf of the Kansas Insurance Department
1-18
AN ACT concerning insurance; relating to examinations; requiring that
insurance examiner per diem amounts and expenses, outside consulting
and data processing fees and pro rata funding for examination
equipment and software be reasonable; establishing a tiered fee
structure for examinations of insurance companies and societies based
on gross premiums; amending K.S.A. 40-223 and repealing the existing
section.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 40-223 is hereby amended to read as follows: 40-
223. (a) (1) Except as provided in K.S.A. 40-110 and 40-253, and
amendments thereto, any person who makes any examination under the
provisions of this act may receive, as full compensation for such person's
services, on a per diem basis an a reasonable amount fixed by the
commissioner, which that shall not exceed the amount recommended by
the national association of insurance commissioners, for such time
necessarily and actually occupied in going to and returning from the place
of such examination and for such time the examiner is necessarily and
actually engaged in making such examination including any day within the
regular workweek when the examiner would have been so engaged had the
company or society been open for business, together with such reasonably
necessary and actual expenses for traveling and subsistence as the
examiner shall incur because of the performance of such services.
(2) For the purposes of this act, "necessary and actual expenses" shall
be limited, whether for travel within the state or travel outside the state, to
those limitations expressed in K.S.A. 75-3207, and amendments thereto,
which that pertain to official travel outside the state. The daily charge shall
be calculated by dividing the amount the examiner is authorized by the
commissioner of insurance to charge per week by the number of days in
the regular workweek of the company or society being examined.
(b) (1) All of such compensation, expenses, the employer's share of
the federal insurance contributions act taxes, the employer's contribution to
the Kansas public employees retirement system as provided in K.S.A. 74-
4920, and amendments thereto, the self-insurance assessment for the
workers compensation act as provided in K.S.A. 44-576, and amendments
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35 HB 2533 2
thereto, the employer's cost of the state health care benefits program under
K.S.A. 75-6507, and amendments thereto, a pro rata amount determined
by the commissioner to provide vacation and sick leave for the examiner
not to exceed the number of days allowed state officers and employees in
the classified service pursuant to regulations promulgated in accordance
with the Kansas civil service act, all reasonable outside consulting and
data processing fees necessary to perform any examination, and a
reasonable pro rata amount determined by the commissioner not to exceed
an annual aggregate of $18,000 to fund the purchase, maintenance and
enhancement of examination equipment and computer software shall be
paid to the commissioner of insurance by the insurance company or
society so examined, on demand of the commissioner.
(2) The amount paid for all costs pursuant to paragraph (1), outside
consulting and data processing fees necessary to perform any financial
examination at any one company or society, including examination of such
company's or society's subsidiaries or any combination thereof, and the pro
rata amount to fund the purchase of examination equipment and computer
software shall not collectively total more than:
(A) $50,000 for any insurance company or society which that has less
than $200,000,000 $5,000,000 in gross premiums, both direct and
assumed, in the preceding calendar year; or
(B) $500,000 for any insurance company or society which has
$200,000,000 or more in gross premiums, both direct and assumed, in the
preceding calendar year$75,000 for any insurance company or society that
has at least $5,000,000 but less than $25,000,000 in gross premiums, both
direct and assumed, in the preceding calendar year;
(C) $100,000 for any insurance company or society that has at least
$25,000,000 but less than $50,000,000 in gross premiums, both direct and
assumed, in the preceding calendar year;
(D) $125,000 for any insurance company or society that has at least
$50,000,000 but less than $100,000,000 in gross premiums, both direct
and assumed, in the preceding calendar year;
(E) $175,000 for any insurance company or society that has at least
$100,000,000 but less than $250,000,000 in gross premiums, both direct
and assumed, in the preceding calendar year;
(F) $250,000 for any insurance company or society that has at least
$250,000,000 but less than $500,000,000 in gross premiums, both direct
and assumed, in the preceding calendar year; or
(G) the actual total costs paid in connection with the examination for
any insurance company or society that has at least $500,000,000 in gross
premiums, both direct and assumed, in the preceding calendar year.
(3) The amount paid for all outside consulting and data processing
fees necessary to perform any market regulation examination at any one
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43 HB 2533 3
company or society, including examination of such company's or society's
subsidiaries, or any combination thereof, and the pro rata amount to fund
the purchase of examination equipment and computer software shall be
reasonable and not collectively total more than $25,000.
(c) Such demand shall be accompanied by the sworn statement of the
person making such examination, setting forth in separate items the
number of days necessarily and actually occupied in going to and returning
from the place of such examination, the number of days the examiners
were necessarily and actually engaged in making such examination
including those days within the regular workweek while the examination
was in progress and the company or society had closed for business, and
the necessary and actual expenses for traveling and subsistence, incurred
in and on account of such services.
(d) A duplicate of every such sworn statement shall be kept on file in
the office of the commissioner of insurance. All moneys so paid to the
commissioner of insurance shall be remitted to the state treasurer in
accordance with the provisions of K.S.A. 75-4215, and amendments
thereto. Upon receipt of each such remittance, the state treasurer shall
deposit the entire amount in the state treasury to the credit of the insurance
company examination fund. The state treasurer shall issue duplicate
receipts therefor, one to be delivered to the commissioner of insurance and
the other to be filed with the director of accounts and reports.
Sec. 2. K.S.A. 40-223 is hereby repealed.
Sec. 3. This act shall take effect and be in force from and after its
publication in the statute book.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25