12-2621.   Premium contributions, determination,deposit and use; refunds.(a) With respect to the categories of coverage described in subparagraphs(d)(1) through (4) of K.S.A. 12-2618, and amendments thereto, premiumcontributions to the pool shall be based upon appropriate manualclassification and rates, plus or minus applicable experience credits ordebits, and minus any advance discount approved by the trustees, not to exceed25% of manual premium. The pool shall use rules, classifications and ratesas promulgated by an approved rating organization for workers compensation ifthe pool has been in operation for less than five years.Such rates shall betheprospective loss costs, as authorized in K.S.A.40-955, and amendments thereto,plus expenses necessary to administer the pool. For purposes of subsection(b), the prospective loss costs shall be presumed to be the 70% required to bedeposited in the claims fund.If the pool has been in operation for more than five years,the board of trustees may determine such rates and discounts as approved by thecommissioner. Premium contributions to the pool for all other lines ofinsurance shall be based on rates filed by a licensed rating organization or onrates of certain companies filing rates with the commissioner and approved bythe commissioner for the pool. In lieu of the foregoing, the board of trusteesmay determine such classification, rates and discounts as approved by thecommissioner.

      Premium contributions to any pool providing life insurance or any poolproviding group sickness and accident insurance as described in K.S.A.12-2617, and amendments thereto, shall be based on sound actuarial principles.

      (b)   An amount equal to at least 70% of the annual premium shall bemaintained in a designated depository for the purpose of paying claims ina claims fund account.If so approved by the commissioner of insurance, the annual premium to bedesignated to such depository may be determined to be the net amount of premiumafter all or a portion of the specific and aggregate excess insurance premiumcosts have been paid. This shall be called the claims fund account.If the pool has been in operation for more than fiveyears the commissioner may authorize allocation of a different amount to theclaims fund account, if solvency of the pool would not be endangered. Theremaining annual premium shall be placed intoa designated depository for the payment of taxes, fees and administrativeand other operational costs in an administrative fund account.

      (c)   Any moneys for a fund year in excess of the amount necessaryto fulfill all obligations of the pool for that fund year, including anyobligation to retain adequate surplus funds, as defined by subsection (h) ofK.S.A. 12-2618, and amendments thereto, in lieu of specific andaggregate excess insurance, may be declared to berefundable by the trustees not less than 12 months after the end of the fundyear. Any such refund shall be paid only to those members who remainedparticipants in the pool for an entire year. Payment of previously earnedrefunds shall not be contingent on continued membership in the pool.

      History:   L. 1987, ch. 74, § 6; L. 1990, ch. 76, § 3;L. 1991, ch. 60, § 2;L. 1995, ch. 76, § 1;L. 1997, ch. 125, § 1;L. 1999, ch. 95, § 3;L. 2002, ch. 86, § 1; July 1.