This bill amends K.S.A. 5-428 to invalidate certain arbitration agreements in insurance contracts. Specifically, it states that any agreement to submit to appraisal or arbitration in contracts of insurance entered into or renewed after July 1, 2025, will not be valid, enforceable, or irrevocable, except for contracts between insurance companies, including reinsurance contracts. Instead, such agreements will be treated as offers by the insurance company to enter into binding or nonbinding arbitration. The bill also clarifies that the court will determine the existence of an arbitration agreement, while arbitrators will decide on the fulfillment of conditions precedent to arbitrability.

Additionally, the bill repeals the existing section of K.S.A. 5-428, streamlining the legal framework surrounding arbitration in insurance contracts. The changes aim to provide greater consumer protection by limiting the enforceability of arbitration agreements in insurance contexts, thereby allowing policyholders more options for dispute resolution. The act will take effect upon its publication in the statute book.

Statutes affected:
As introduced: 5-428