Kansas Senate Bill SB512

Kansas 2023-2024 Regular Session

• Introduced: 2/14/24
• Refer: 2/15/24
• Failed: 4/30/24

Caption

Prohibiting insurance companies from using environmental, social and governance criteria in the process of writing contracts of insurance, indemnity or suretyship, authorizing the attorney general or the county attorney or district attorney where a violation occurred to enforce such prohibition and providing a civil penalty for violations thereof.

Impact

If enacted, SB512 would significantly alter the operational landscape for insurance companies within the state. By mandating that ESG criteria not be considered in the contracting process, the bill could empower traditional underwriting strategies and lower potential costs associated with compliance to ESG-focused criteria. However, this could also limit the industry's ability to adapt to changing social norms and community expectations regarding responsible investment and sustainability practices.

Summary

Senate Bill 512 addresses the regulatory framework surrounding the insurance industry by prohibiting insurance companies from incorporating environmental, social, and governance (ESG) criteria in their contracts, including those related to insurance, indemnity, and suretyship. The bill aims to limit the influence of ESG factors in underwriting decisions, reflecting a movement towards deregulation and a desire to maintain traditional underwriting practices based purely on business and economic considerations.

Contention

The bill has sparked considerable debate among legislators and stakeholders. Supporters argue that the bill protects the insurance sector from being influenced by potentially politicized ESG concerns, allowing for a more straightforward and economically driven approach to insurance underwriting. Conversely, opponents contend that this legislation would undermine the capacity of insurance companies to address significant societal challenges, such as climate change and social equity, thus potentially hampering innovative insurance solutions that align with evolving public interests.