The bill amends existing Kansas insurance laws to require third-party administrators to maintain separate fiduciary accounts for each individual payor, ensuring that funds collected on behalf of multiple payors are not commingled. This change mandates that all insurance charges, premiums, and reimbursements collected by administrators be held in a fiduciary capacity and remitted promptly to the entitled parties. Additionally, the bill stipulates that administrators must provide detailed accounting to payors and maintain clear records of all transactions related to each payor and policyholder.

Furthermore, the bill modifies the disclosure requirements for administrators regarding bankruptcy filings. It removes the previous requirement for immediate disclosure and instead requires that any bankruptcy petition filed by the administrator be disclosed to the commissioner of insurance at the time of filing. The bill also repeals the existing sections of K.S.A. 40-3807 and 40-3809, replacing them with the new provisions outlined in the act. The act will take effect upon publication in the Kansas register.

Statutes affected:
As introduced: 40-3807, 40-3809
As Amended by Senate Committee: 40-3807, 40-3809