| 1 | 1 | | Session of 2023 |
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| 2 | 2 | | SENATE BILL No. 15 |
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| 3 | 3 | | By Committee on Financial Institutions and Insurance |
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| 4 | 4 | | 1-10 |
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| 5 | 5 | | AN ACT concerning insurance; relating to penalties; failure of agents or |
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| 6 | 6 | | brokers to pay premiums; removing the requirement of a documented |
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| 7 | 7 | | written demand for premiums as part of a prima facie case; amending |
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| 8 | 8 | | K.S.A. 40-247 and repealing the existing section. |
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| 9 | 9 | | Be it enacted by the Legislature of the State of Kansas: |
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| 10 | 10 | | Section 1. K.S.A. 40-247 is hereby amended to read as follows: 40- |
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| 11 | 11 | | 247. (a) An insurance agent or broker who acts in negotiating or renewing |
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| 12 | 12 | | or continuing a contract of insurance including any type of annuity by an |
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| 13 | 13 | | insurance company lawfully doing business in this state, and who receives |
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| 14 | 14 | | any money or substitute for money as a premium for such a contract from |
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| 15 | 15 | | the insured, whether such agent or broker shall be entitled to an interest in |
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| 16 | 16 | | same or otherwise, shall be deemed to hold such premium in trust for the |
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| 17 | 17 | | company making the contract. If such agent or broker fails to pay the same |
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| 18 | 18 | | over to the company after written demand made upon such agent or |
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| 19 | 19 | | broker, less such agent's or broker's commission and any deductions, to |
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| 20 | 20 | | which by the written consent of the company such agent or broker may be |
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| 21 | 21 | | entitled, such failure shall be prima facie evidence that such agent or |
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| 22 | 22 | | broker has used or applied the premium for a purpose other than paying |
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| 23 | 23 | | the same over to the company. |
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| 24 | 24 | | (b) (1) An agent or broker who violates the provisions of this section |
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| 25 | 25 | | shall be guilty of a: |
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| 26 | 26 | | (A) Severity level 7, nonperson felony if the value of the insurance |
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| 27 | 27 | | premium is $25,000 or more; |
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| 28 | 28 | | (B) severity level 9, nonperson felony if the value of the insurance |
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| 29 | 29 | | premium is at least $1,000 but less than $25,000; or |
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| 30 | 30 | | (C) class A nonperson misdemeanor if the value of the insurance |
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| 31 | 31 | | premium is less than $1,000. |
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| 32 | 32 | | (2) If the value of the insurance premium is less than $1,000 and such |
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| 33 | 33 | | agent or broker has, within five years immediately preceding commission |
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| 34 | 34 | | of the crime, been convicted of violating this section two or more times |
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| 35 | 35 | | shall be guilty of a severity level 9, nonperson felony. |
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| 36 | 36 | | Sec. 2. K.S.A. 40-247 is hereby repealed. |
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| 37 | 37 | | Sec. 3. This act shall take effect and be in force from and after its |
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| 38 | 38 | | publication in the statute book. |
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