UNOFFICIAL COPY 23 RS BR 1689
Page 1 of 4
XXXX 2/22/2023 12:22 PM Jacketed
AN ACT relating to state property and declaring an emergency. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 56.100 is amended to read as follows: 3
(1) (a) Each fiscal year the State Treasurer shall deduct from any funds in the 4
Treasury payable to an agency for the care and maintenance of public 5
buildings or property[,] an amount equal to the premiums certified to him or 6
her as chargeable against that agency. The amount so debited shall be credited 7
to an account kept by the State Treasurer and known as the state fire and 8
tornado insurance fund. 9
(b) On and after the effective date of this Act until June 30, 2025, no premium 10
shall be charged on any one (1) subject of risk upon a valuation of more 11
than ten million dollars ($10,000,000), unless the Office of the Controller in 12
the Finance and Administration Cabinet has contracted for reinsurance 13
that limits the liability of the fund to ten million dollars ($10,000,000) upon 14
that risk. 15
(c) On and after July 1, 2025, no premium shall be charged on any one (1) 16
subject of risk upon a valuation of more than one million dollars ($1,000,000), 17
unless the Office of the Controller in the Finance and Administration Cabinet 18
has contracted for reinsurance that limits the liability of the fund to one 19
million dollars ($1,000,000) upon such subject of risk. 20
(2) The Office of the Controller in the Finance and Administration Cabinet shall 21
prescribe a certificate setting forth the terms and conditions of coverage under the 22
state fire and tornado insurance fund. Different forms of certificates may be used 23
for different risks. Such certificates may contain such terms and conditions as the 24
Office of the Controller in the Finance and Administration Cabinet may prescribe, 25
including but not limited to a deductible, in order that there be fair allocation of 26
significant losses and the elimination of unnecessary costs in administering the state 27 UNOFFICIAL COPY 23 RS BR 1689
Page 2 of 4
XXXX 2/22/2023 12:22 PM Jacketed
fire and tornado insurance fund. 1
Section 2. KRS 56.120 is amended to read as follows: 2
(1) When the amount of damage has been determined, the State Treasurer shall debit 3
the account of the state fire and tornado insurance fund by that amount and credit 4
with an equal amount the account of the agency that has control or custody of the 5
property damaged, and upon warrant from the Finance and Administration Cabinet, 6
the Treasurer shall pay to the agency the amount so credited to it, for the purpose of 7
repairing the damage or reconstructing or replacing the damaged or destroyed 8
property. If the agency deems it impracticable or undesirable to use the money for 9
repair, reconstruction, or replacement of the property damaged or destroyed, it may, 10
with the approval of the Finance and Administration Cabinet, and subject to the 11
provisions of KRS 56.491, expend said funds for the acquisition, repair, 12
construction, or reconstruction of property similar to the property damaged or 13
destroyed. 14
(2) On and after the effective date of this act until June 30, 2025, no debit, credit, or 15
payment made on account of the damage to any one (1) subject of risk, by any 16
one (1) loss, shall be in excess of ten million dollars ($10,000,000), unless the 17
Office of the Controller in the Finance and Administration Cabinet has effected 18
reinsurance upon that risk to limit the liability of the state fire and tornado 19
insurance fund to ten million dollars ($10,000,000), and unless the excess over 20
this amount has actually been paid into the fund by the reinsuring company or 21
companies. 22
(3) On and after July 1, 2025, no debit, credit, or payment made on account of the 23
damage to any one (1) subject of risk, by any one (1) loss, shall be in excess of one 24
million dollars ($1,000,000), unless the Office of the Controller in the Finance and 25
Administration Cabinet has effected reinsurance upon the subject of risk such as to 26
limit the liability of the state fire and tornado insurance fund to one million dollars 27 UNOFFICIAL COPY 23 RS BR 1689
Page 3 of 4
XXXX 2/22/2023 12:22 PM Jacketed
($1,000,000), and unless the excess over this amount has actually been paid into the 1
fund by the reinsuring company or companies. 2
Section 3. KRS 56.160 is amended to read as follows: 3
(1) On or after the effective date of this Act until June 30, 2025, the Office of the 4
Controller in the Finance and Administration Cabinet may contract with any 5
responsible fire and tornado insurance or reinsurance company authorized to do 6
business in Kentucky to reinsure any subject of risk of which the total valuation 7
has been fixed at over ten million dollars ($10,000,000) in such a way as to limit 8
the net liability of the state fire and tornado insurance fund with respect to that 9
risk to ten million dollars ($10,000,000). The premium for reinsurance shall be 10
paid out of the state fire and tornado insurance fund, on warrant of the cabinet. 11
(2) On or after July 1, 2025, the Office of the Controller in the Finance and 12
Administration Cabinet may contract with any responsible fire and tornado 13
insurance or reinsurance company authorized to do business in Kentucky to 14
reinsure any subject of risk of which the total valuation has been fixed at over one 15
million dollars ($1,000,000) in such a way as to limit the net liability of the state 16
fire and tornado insurance fund with respect to such subject of risk to one million 17
dollars ($1,000,000). The premium for reinsurance shall be paid out of the state fire 18
and tornado insurance fund, on warrant of the cabinet. 19
Section 4. KRS 56.180 is amended to read as follows: 20
(1) On or after the effective date of this Act until June 30, 2025, if at the end of any 21
fiscal year the moneys and securities to the credit of the state fire and tornado 22
insurance fund exceed one hundred million dollars ($100,000,000), that excess 23
shall be transferred to the general fund. 24
(2) On or after July 1, 2025, if at the end of any fiscal year the moneys and securities 25
to the credit of the state fire and tornado insurance fund exceed ten million dollars 26
($10,000,000), any such excess shall be transferred to the general fund. 27 UNOFFICIAL COPY 23 RS BR 1689
Page 4 of 4
XXXX 2/22/2023 12:22 PM Jacketed
(2) The moneys and securities to the credit of the state fire and tornado insurance fund 1
shall not be used for any purpose unrelated to fund operations. 2
Section 5. Whereas it may be necessary to negotiate upcoming insurance rates 3
for the Commonwealth of Kentucky, an emergency is declared to exist, and this Act takes 4
effect upon its passage and approval of the Governor or upon its otherwise becoming a 5
law. 6