The bill amends existing Kansas insurance laws to enhance the fiduciary responsibilities of third-party administrators (TPAs) regarding the handling of funds for individual payors. It mandates that TPAs maintain separate fiduciary accounts for each payor, ensuring that funds collected or held on behalf of multiple payors are not commingled. Additionally, the bill requires TPAs to provide detailed accounting to payors and to keep comprehensive records of all transactions related to each payor's account. It also stipulates that claims can only be paid from these accounts as authorized by the payor, and outlines specific permissible withdrawals from fiduciary accounts.

Furthermore, the bill introduces a requirement for TPAs to disclose any bankruptcy petitions filed on their behalf to the commissioner of insurance. It amends K.S.A. 40-3807 and K.S.A. 40-3809, while repealing the existing sections of these statutes. The changes aim to improve transparency and accountability in the financial dealings of TPAs, thereby protecting the interests of payors and ensuring compliance with regulatory standards.

Statutes affected:
As introduced: 40-3807, 40-3809