All Roll Calls
Yes: 316 • No: 11
KansasHB 23342025–2026 Regular SessionHouseWALLET
Enacting the Kansas protected cell captive insurance company act, providing for the redomestication of a foreign or alien captive insurance company and updating certain terms, requirements and conditions of the captive insurance act, reducing insurance company premium tax rates, creating parity between the insurance agent and public adjuster licensing requirements, authorizing insurers to file certain travel insurance policies under the accident and health line of insurance and authorizing the commissioner of insurance to select and announce the version of certain instructions, calculations and documents in effect for the upcoming calendar year and cause such announcement to be published in the Kansas register not later than December 1 of the current year.
Sponsored By: Sponsor information unavailable
Signed by Governor
financial institutions and insuranceinsurance
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Bill Overview
Analyzed Economic Effects
25 provisions identified: 3 benefits, 4 costs, 18 mixed.
Taxes and caps for captive insurers
Captive insurance companies pay 0.2% tax on direct premiums for Kansas risks, capped at $500,000. Annuity consideration is not taxed. They pay 0.1% on assumed reinsurance premiums, capped at $300,000, due by March 1. Multi-year policy premiums are spread across years for tax. This premium tax is the only Kansas tax on captives, aside from regular property taxes.
Stronger protections for protected cells
Incorporated cells can use any business form the commissioner allows, including series LLCs, and are treated as captive insurers. Asset and liability moves must follow the approved plan and be in cash or marketable securities. A cell’s assets cannot be used to pay other cells’ or the general account’s liabilities, and transfers among cells need consent or approval. Receivership law applies, but a cell’s assets pay only that cell’s claims, while company capital and surplus remain available for company‑level expenses. Cells and captives can convert between forms, and a wide range of entities can be participants, usually to insure only their own risks.
Agents and adjusters face tougher discipline
You must answer commissioner inquiries within 15 business days or face license action. Licenses can be denied or revoked for breaking Kansas or other states’ insurance laws or orders, crimes, unfair trade practices, dishonest or incompetent conduct, or prior denials elsewhere. The commissioner may also act when a license no longer serves insurer or public interests. Not paying child support or state income tax can trigger action. If your agent or broker license is suspended or revoked, you cannot work for or contract with any insurer in Kansas during that time. The same discipline standards also apply to public adjusters.
Tighter sales and conduct rules for agents
The commissioner can deny or revoke an insurance license for false applications, getting a license by fraud, stealing or misusing client money, forgery, or cheating on exams. Agents cannot rebate premiums or offer side deals not in the policy. Agents also cannot make misleading comparisons to push someone to drop coverage. Taking business from someone you know is unlicensed can lead to discipline. These rules raise the bar for honest sales and recordkeeping.
Insurance agencies liable for employee violations
Your insurance agency’s license can be suspended or revoked for an employee’s violation. This applies when partners, officers, or managers knew or should have known. It also applies if the agency did not report it or failed to fix it. Keep clear reporting and corrective steps to stay licensed.
Commissioner selects annual capital manuals
The commissioner selects which NAIC risk‑based capital instructions, the Financial Analysis Handbook, Group Capital Calculation Instructions, and the Liquidity Stress Test apply each year. The choice is announced by December 1 for the next calendar year. The law also repeals older statutes to align Kansas rules with these updated standards.
Insurer group data kept confidential
The insurance commissioner keeps group capital ratios, stress tests, and exam files confidential. These tools are for supervision and cannot be used to rank insurers. The commissioner may share them with the NAIC and other regulators only under strict written confidentiality agreements; sharing does not waive privilege or delegate authority, and NAIC‑held copies stay confidential. Confidential materials are not public records and can be published only after notice and a finding that release serves policyholders or the public. Each year, the commissioner selects which NAIC instructions apply and publishes the choice by December 1. If false public claims appear about an insurer’s group capital or stress tests, the insurer can publish a rebuttal after showing the commissioner strong proof.
Limits on captives' insurance business
Captive insurers can apply to write lines allowed under Kansas law, but key limits apply. Captives cannot write personal lines and are barred from direct accident and health, life, or annuity sales. A captive authorized as a life insurer may only write life insurance. A pure captive may write controlled unaffiliated business only with prior approval and up to 5% of total direct written premium. An association captive cannot expose more than 10% of its paid‑up capital and surplus to any one risk.
New fund for insurance regulation
Beginning January 1, 2026, all fees the commissioner collects and 1% of taxes under K.S.A. 40-252 go to the Insurance Department Service Regulation Fund. For example, $100,000 of those taxes produces a $1,000 remittance. This shifts receipts to support insurance regulation.
Stricter rules for insurer affiliate deals
Domestic insurers must give the insurance commissioner at least 30 days’ notice before large deals with affiliates. For nonlife insurers, notice starts at the lesser of 3% of admitted assets or 25% of surplus; for life insurers, 3% of admitted assets. Big reinsurance or pooling deals need notice at 5% of surplus, and loans that mainly benefit an affiliate follow the same 3%/25% tests. Insurers must also give notice for service and tax‑sharing agreements and when their group owns over 10% of a company’s voting stock. Extraordinary dividends require prior notice, and a dividend is “extraordinary” if it exceeds 10% of surplus or recent net gain/income (with the law’s carryforward rules). To protect solvency, the commissioner can require a deposit or bond (capped at one year of the contract’s value), disallow affiliate investments in surplus, order records, and hire outside experts; companies pay exam costs and face up to $1,000 per day for unjustified delays. The law confirms insurer ownership and receiver access to records and premiums held by affiliates, and lets the commissioner add more reportable transactions by rule.
Tighter oversight of insurance groups
Insurers may not split deals into smaller transactions over 12 months to dodge prior‑notice thresholds. The commissioner can enforce the holding company law when such avoidance is found. The commissioner can also examine any registered insurer and its affiliates on a consolidated basis to assess enterprise‑level risks.
Lower insurer taxes and redomestication rules
For 2025, the insurer premium tax rate is 2%. For 2026 and later, it is 1.98%. A company that moves its home to Kansas pays tax only on premiums received after it moves. If it moves after July 1, it owes half of the minimum premium tax for that year. A foreign or alien company may skip premium tax in its first or its second year here, but not both. If it gives up its Kansas authority or leaves within five years, it must repay the skipped tax plus 10% per year.
Easier redomestication for captives
A foreign or alien captive insurer can become a Kansas domestic captive. The company must meet Kansas organization and licensing rules, get consent from its prior regulator, and file papers with the Kansas Secretary of State and the commissioner. The company keeps its original formation date, and similar prior exams may count toward scheduling the next exam.
Travel insurance filing flexibility
Travel insurance forms and rates are filed under inland marine. When coverage includes sickness, accident, disability, or death during travel, insurers may file under accident and health instead. This gives insurers a choice on how to file these travel policies.
Ban on ads using capital ratios
Insurers cannot use group capital ratios or liquidity stress test results in ads or public statements. The ban covers media and marketing. Disclosures are still allowed when the insurance holding company law requires them.
Stricter penalties for insurance agents
Insurance agents can be fined up to $500 per violation (max $2,500 in six months), or up to $1,000 (max $5,000) if they knew or should have known. If your application is denied after a hearing, you must wait one year to reapply; after revocation, the wait is two years. You must receive notice and a chance for a hearing, but hearing costs can be charged to you or your business. The commissioner considers clear factors for reinstating a revoked license, and must weigh listed factors when a past conviction is involved. No new disciplinary case may start more than two years after your license ended.
Tougher rules for public adjusters
Public adjusters face stricter discipline and fines. Penalties can be up to $500 per violation (max $2,500 in six months), or up to $1,000 (max $5,000) if you knew or should have known. If your license is suspended or revoked, you cannot work in insurance during that period. You get notice and a hearing, but hearing costs can be charged to you or your business. The commissioner may deny a license for public-interest reasons, must weigh criminal‑history factors, and can still enforce the law even if you surrender or let a license lapse. If denied after a hearing, you must wait one year to reapply; after revocation, the wait is two years.
Law takes effect upon publication
This law takes effect when it is published in the statute book.
Public adjuster fines go to state
Fines the department collects under the public adjuster penalty rules are sent to the state treasurer. The treasurer deposits the full amount in the state general fund.
Clearer definitions for health plan terms
The law defines common health plan terms. It explains who is an insured and who counts as a provider. It sets what emergency medical condition and emergency services mean. It also lists which plans are not health benefit plans. These definitions guide how coverage rules apply.
Capital and license terms for captives
Captives must meet minimum capital and surplus to stay licensed: $250,000 for pure captives, $500,000 for association stock captives, and $100,000 for protected‑cell captives. The commissioner can require more capital based on the business and risks. Captives may use an approved irrevocable letter of credit from a Kansas‑domiciled bank to meet minimum capital. A captive’s certificate of authority runs until March 1 after it is granted. For technology‑enabled fiduciary insurers, the certificate can run until the later of that March 1 or the maturity date of the last payment‑in‑kind asset.
More oversight for captive insurers
Captives may not count loans as required capital; a commissioner‑approved surplus note can be used instead. Pure captives need prior written approval to lend to or invest in a parent or affiliate, with documentation the commissioner approves. The commissioner runs financial exams at least every five years and may examine as needed. Captives cannot be forced to join rating or policy form organizations. Captives that existed on January 1, 2018 pay a $110 annual renewal fee until January 1, 2028.
New rules and fees for captives
Captive insurers may offer excess or stop‑loss health coverage and workers’ compensation, unless barred by federal or state law. A Kansas‑domiciled captive must keep its main office in Kansas, hold at least one board meeting a year in Kansas, and get a certificate before doing business. Applications must include a plan of operation with loss history, financial projections, an investment policy, key personnel, and, when required, an actuary’s opinion. The commissioner may issue a provisional certificate if a complete filing and fees are in, and managers have acceptable expertise and character. New captives must pay nonrefundable application and related review fees; the statute references $10,000 and also $2,500, and the commissioner may bill outside review costs. In lawsuits, protected‑cell captives must name the specific cell as a party; unnamed cells are not parties and can be dismissed.
New rules for protected-cell captives
Kansas creates a protected‑cell captive insurance framework. Sponsors may form these captives as a stock company, nonprofit, or LLC. Each cell must have its own name and a separate account. The commissioner must approve a written plan before a cell starts or a participant contract takes effect. Cell business must be fronted, reinsured, or fully secured by a U.S. trust or irrevocable letter of credit at least equal to reserves. The company keeps separate books for each cell, files an annual report, and must notify the commissioner within 10 business days if a cell cannot meet claims. Cells may pool assets for investment and may hire outside managers paid only from that cell’s assets.
Stronger exams and confidentiality for captives
Information in captive applications is confidential and not public. It can be ordered in court only if it is relevant, not available elsewhere, and subpoenaed to the commissioner. The commissioner can access company records, question people under oath, and examine related businesses, and companies must pay the reasonable cost of any outside experts used. Exam timing is set: the examiner files a report within 30 days, the company has up to 30 days to respond, and the commissioner acts within 30 days after that. Exam reports and work papers are confidential, but they may be shared with regulators under written confidentiality agreements.
Sponsors & Cosponsors
Sponsors
There is no primary sponsor on record.
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
House vote • 4/23/2026
Yea: 123 Nay: 1
Yes: 123 • No: 1
House vote • 4/23/2026
Yea: 40 Nay: 0
Yes: 40 • No: 0
House vote • 4/23/2026
Yea: 113 Nay: 10
Yes: 113 • No: 10
House vote • 4/23/2026
Yea: 40 Nay: 0
Yes: 40 • No: 0
Actions Timeline
Reengrossed on Tuesday, April 1, 2025
4/10/2025HouseEnrolled and presented to Governor on Friday, April 4, 2025
4/10/2025HouseApproved by Governor on Tuesday, April 8, 2025
4/10/2025HouseConference committee report now available
3/27/2025SenateConference Committee Report was adopted; Yea: 40 Nay: 0
3/27/2025SenateConference Committee Report was adopted; Yea: 123 Nay: 1
3/27/2025HouseNonconcurred with amendments; Conference Committee requested; appointed Representative Sutton , Representative Bergkamp and Representative Neighbor as conferees
3/24/2025HouseMotion to accede adopted; Senator Dietrich, Senator Fagg and Senator Francisco appointed as conferees
3/24/2025SenateCommittee of the Whole - Committee Report be adopted
3/20/2025SenateCommittee of the Whole - Motion to Amend - Offered by Senator Francisco
3/20/2025SenateCommittee of the Whole - Amendment by Senator Francisco was adopted
3/20/2025SenateCommittee of the Whole - Be passed as further amended
3/20/2025SenateEmergency Final Action - Passed as amended; Yea: 40 Nay: 0
3/20/2025SenateCommittee Report recommending bill be passed as amended by Committee on Financial Institutions and Insurance
3/18/2025SenateHearing continuation: Wednesday, March 12, 2025, 9:30 AM Room 546-S
3/12/2025SenateHearing: Wednesday, March 5, 2025, 9:30 AM Room 546-S
3/5/2025SenateReferred to Committee on Financial Institutions and Insurance
2/26/2025SenateEngrossed on Thursday, February 20, 2025
2/26/2025HouseReceived and Introduced
2/25/2025SenateFinal Action - Passed as amended; Yea: 113 Nay: 10
2/20/2025HouseCommittee of the Whole - Committee Report be adopted
2/19/2025HouseCommittee of the Whole - Be passed as amended
2/19/2025HouseCommittee Report recommending bill be passed as amended by Committee on Insurance
2/18/2025HouseHearing: Friday, February 14, 2025, 3:30 PM Room 218-N
2/14/2025HouseHearing: Wednesday, February 12, 2025, 3:30 PM Room 218-N - CANCELED
2/12/2025House
Bill Text
As Amended by House Committee
As Amended by Senate Committee
As Amended by Senate Committee of the Whole
As introduced
Enrolled
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