SESSION OF 2023
SUPPLEMENTAL NOTE ON HOUSE BILL NO. 2097
As Amended by Senate Committee on Financial
Institutions and Insurance

Brief*
HB 2097, as amended, would remove the requirement
of a documented written demand from an insurance company
for unpaid premiums by an agent or broker.
Under current law, the failure of an agent or broker to
pay premiums owed to an insurer after written demand is
made is considered prima facie evidence that the agent or
broker has used or applied the premium for another purpose.
Such failure then subjects the agent or broker to the penalties
listed in KSA 40-247(b).
The bill would remove the requirement of the written
demand in establishing prima facie evidence.
The bill would be in effect upon publication in the
Kansas Register.

Background
The bill was introduced by the House Committee on
Insurance at the request of the Kansas Insurance Department
(Department). [Note: A companion bill, SB 15, was introduced
in the Senate.]


____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
House Committee on Insurance
In the House Committee hearing, proponent testimony
was provided by a representative of the Department, stating
the written demand requirement is not always fulfilled in
cases of unpaid premiums, causing evidentiary issues. The
removal of the requirement for a written demand would not
preclude the Department from taking administrative action
against a licensee, and the agent must still be shown beyond
a reasonable doubt to have used the premium for unlawful
purposes.
No other testimony was presented.

Senate Committee on Financial Institutions and
Insurance
In the Senate Committee hearing, an overview of the bill
was provided and proponent testimony submitted by the
Kansas Insurance Department was made available.
The Senate Committee amended the bill to change its
effective date to upon publication in the Kansas Register.

Fiscal Information
According to the fiscal note prepared by the Division of
the Budget on the bill, as introduced, the Department,
Department of Corrections, and Judicial Branch all state
enactment of the bill would not have a fiscal effect.
Insurance; penalties; Kansas Insurance Department


2- 2097


Statutes affected:
As introduced: 40-247
As Amended by Senate Committee: 40-247
Enrolled: 79-3606