H.B. 2636 would amend one section of Kansas law dealing with reinsurance agreements. The bill would strike the words "policyholder and" to clarify that the interests of ceding insurance companies, not policyholders, are protected by trust funds created by reinsurance companies as prescribed by law.
H.B. 2636 was requested by the Insurance Commissioner whose representative explained that this technical change in the law would clarify that reinsurance trust funds are required of reinsurers to pay claims solely to ceding insurance companies. Including policyholders in reinsurance statutes, he indicated, was inappropriate and such references have been deleted from the model law of the National Association of Insurance Commissioners upon which the Kansas law was based.
Deleting reference to policyholders would have no impact on claims of policyholders since those claims would be made against the company that issued the policy of insurance.
1. *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.ink.org/public/legislative/fulltext-bill.html.