40-222b.Insurance company in hazardous financial condition; orderof commissioner, notice and hearing; requirements which may be imposed;transfer of special deposit to guaranty fund, when.(a) Whenever the financial condition of any insurance company, hereinafterreferred to as "company," authorized to do business in this stateattains a condition such that the continued operation of the companymight be hazardous to the insuring public, the commissioner, afternotice and hearing in accordance with the provisions of the Kansasadministrative procedure act, may order the company to take such action asmay bereasonably necessary to rectify the existing condition, including, butnot necessarily limited to, one or more of the following measures:
(1) Require the company to reduce the volume of new, renewal or new andrenewal business being accepted to an amount and for the period of timespecified by the commissioner in the manner prescribed by the commissioner'sorder;
(2) require the submission of such reinsurance contracts forapproval and make such requirements relative to the company'sreinsurance program as the commissioner deems necessary to protect theinterests of Kansas policyholders;
(3) require the company to reinsure on a bulk or portfolio basis all orany part of its Kansas business with a company duly authorized to transactsuch business in this state;
(4) require a contribution to surplus which will increase thecompany's surplus for such a period of time, and by such an amount, andin such a manner, as the commissioner may deem necessary and essential;
(5) require the company to maintain a special deposit with thecommissioner of insurance of this state in cash or securities of thekinds in which a domestic insurer is permitted to invest its funds underthe provisions of K.S.A. 40-2a01 to 40-2a05, inclusive, 40-2a07 and40-2a10, and amendments thereto, if other than a life insurance company, orK.S.A. 40-2b01 to 40-2b06, inclusive, and 40-2b16, and amendments thereto,if a life insurance company.
Such securities held as a special deposit shall at all times have a marketvalue at least equal to the gross reserves that would reasonably be requiredto discharge the company's liabilities for the claims and claims' expensesof Kansas policyholders and claimants. The amount of the special depositrequired of any life insurance company may be reduced by policy loans anddeferred and uncollected premiums related to the company's Kansas business.Any special deposit required by this subsection shall be for the protectionand benefit of Kansas policyholders and claimants only and shall not bewithdrawn until the commissioner abrogates the requirements imposed by anyorder issued or agreement reached pursuant to the provisions of this section.The provisions of this subsection shall not apply to any insurance companyorganized under the laws of this state;
(6) require the company to maintain a general deposit with the commissionerof insurance in this state in cash or securities of the kinds authorizedby K.S.A. 40-2a01 et seq., and amendments thereto, if other than alife insurance company, or K.S.A. 40-2b01 and amendments thereto, if a lifeinsurance company unless such statutes specifically exclude such securitiesfor deposit. Any general deposit required by this subsection shall be inan amount designated by the commissioner for the protection and benefitof those persons and entities referred to inK.S.A. 40-3641and amendments thereto, and shall not be withdrawn until the commissionerabrogates the requirements imposed by any order issued or agreement reachedpursuant to the provisions of this section. The provisions of this subsectionshall only apply to insurance companies organized under the laws of this state.
(b) Whenever a guaranty fund, established pursuant to article 29 or30 of chapter 40 of the Kansas Statutes Annotated, is activated for theprotection of Kansas policyholders and claimants of an insurance companythat has made a special deposit under the provisions of this section, thecommissioner shall transfer the special deposit to such guaranty fund underan agreement approved by the commissioner which will provide protectionto all Kansas policyholders and claimants. Any funds from such special depositwhich remain after the payment of all claims and claims' expenses of Kansaspolicyholders and claimants shall be returned to the insurance supervisoryofficial of the company's state of domicile. If a Kansas domestic insurancecompany has made a deposit under the provisions of this section, anydistributionof such deposit shall be made in accordance with the provisions of K.S.A.40-3641 and amendments thereto.
History: L. 1972, ch. 177, § 1; L. 1986, ch. 169, § 1; L.1988, ch. 356, § 75;L. 1991, ch. 125, § 55; July 1.
40-222b.Insurance company in hazardous financial condition; orderof commissioner, notice and hearing; requirements which may be imposed;transfer of special deposit to guaranty fund, when.(a) Whenever the financial condition of any insurance company, hereinafterreferred to as "company," authorized to do business in this stateattains a condition such that the continued operation of the companymight be hazardous to the insuring public, the commissioner, afternotice and hearing in accordance with the provisions of the Kansasadministrative procedure act, may order the company to take such action asmay bereasonably necessary to rectify the existing condition, including, butnot necessarily limited to, one or more of the following measures:
(1) Require the company to reduce the volume of new, renewal or new andrenewal business being accepted to an amount and for the period of timespecified by the commissioner in the manner prescribed by the commissioner'sorder;
(2) require the submission of such reinsurance contracts forapproval and make such requirements relative to the company'sreinsurance program as the commissioner deems necessary to protect theinterests of Kansas policyholders;
(3) require the company to reinsure on a bulk or portfolio basis all orany part of its Kansas business with a company duly authorized to transactsuch business in this state;
(4) require a contribution to surplus which will increase thecompany's surplus for such a period of time, and by such an amount, andin such a manner, as the commissioner may deem necessary and essential;
(5) require the company to maintain a special deposit with thecommissioner of insurance of this state in cash or securities of thekinds in which a domestic insurer is permitted to invest its funds underthe provisions of K.S.A. 40-2a01 to 40-2a05, inclusive, 40-2a07 and40-2a10, and amendments thereto, if other than a life insurance company, orK.S.A. 40-2b01 to 40-2b06, inclusive, and 40-2b16, and amendments thereto,if a life insurance company.
Such securities held as a special deposit shall at all times have a marketvalue at least equal to the gross reserves that would reasonably be requiredto discharge the company's liabilities for the claims and claims' expensesof Kansas policyholders and claimants. The amount of the special depositrequired of any life insurance company may be reduced by policy loans anddeferred and uncollected premiums related to the company's Kansas business.Any special deposit required by this subsection shall be for the protectionand benefit of Kansas policyholders and claimants only and shall not bewithdrawn until the commissioner abrogates the requirements imposed by anyorder issued or agreement reached pursuant to the provisions of this section.The provisions of this subsection shall not apply to any insurance companyorganized under the laws of this state;
(6) require the company to maintain a general deposit with the commissionerof insurance in this state in cash or securities of the kinds authorizedby K.S.A. 40-2a01 et seq., and amendments thereto, if other than alife insurance company, or K.S.A. 40-2b01 and amendments thereto, if a lifeinsurance company unless such statutes specifically exclude such securitiesfor deposit. Any general deposit required by this subsection shall be inan amount designated by the commissioner for the protection and benefitof those persons and entities referred to inK.S.A. 40-3641and amendments thereto, and shall not be withdrawn until the commissionerabrogates the requirements imposed by any order issued or agreement reachedpursuant to the provisions of this section. The provisions of this subsectionshall only apply to insurance companies organized under the laws of this state.
(b) Whenever a guaranty fund, established pursuant to article 29 or30 of chapter 40 of the Kansas Statutes Annotated, is activated for theprotection of Kansas policyholders and claimants of an insurance companythat has made a special deposit under the provisions of this section, thecommissioner shall transfer the special deposit to such guaranty fund underan agreement approved by the commissioner which will provide protectionto all Kansas policyholders and claimants. Any funds from such special depositwhich remain after the payment of all claims and claims' expenses of Kansaspolicyholders and claimants shall be returned to the insurance supervisoryofficial of the company's state of domicile. If a Kansas domestic insurancecompany has made a deposit under the provisions of this section, anydistributionof such deposit shall be made in accordance with the provisions of K.S.A.40-3641 and amendments thereto.
History: L. 1972, ch. 177, § 1; L. 1986, ch. 169, § 1; L.1988, ch. 356, § 75;L. 1991, ch. 125, § 55; July 1.
40-222b.Insurance company in hazardous financial condition; orderof commissioner, notice and hearing; requirements which may be imposed;transfer of special deposit to guaranty fund, when.(a) Whenever the financial condition of any insurance company, hereinafterreferred to as "company," authorized to do business in this stateattains a condition such that the continued operation of the companymight be hazardous to the insuring public, the commissioner, afternotice and hearing in accordance with the provisions of the Kansasadministrative procedure act, may order the company to take such action asmay bereasonably necessary to rectify the existing condition, including, butnot necessarily limited to, one or more of the following measures:
(1) Require the company to reduce the volume of new, renewal or new andrenewal business being accepted to an amount and for the period of timespecified by the commissioner in the manner prescribed by the commissioner'sorder;
(2) require the submission of such reinsurance contracts forapproval and make such requirements relative to the company'sreinsurance program as the commissioner deems necessary to protect theinterests of Kansas policyholders;
(3) require the company to reinsure on a bulk or portfolio basis all orany part of its Kansas business with a company duly authorized to transactsuch business in this state;
(4) require a contribution to surplus which will increase thecompany's surplus for such a period of time, and by such an amount, andin such a manner, as the commissioner may deem necessary and essential;
(5) require the company to maintain a special deposit with thecommissioner of insurance of this state in cash or securities of thekinds in which a domestic insurer is permitted to invest its funds underthe provisions of K.S.A. 40-2a01 to 40-2a05, inclusive, 40-2a07 and40-2a10, and amendments thereto, if other than a life insurance company, orK.S.A. 40-2b01 to 40-2b06, inclusive, and 40-2b16, and amendments thereto,if a life insurance company.
Such securities held as a special deposit shall at all times have a marketvalue at least equal to the gross reserves that would reasonably be requiredto discharge the company's liabilities for the claims and claims' expensesof Kansas policyholders and claimants. The amount of the special depositrequired of any life insurance company may be reduced by policy loans anddeferred and uncollected premiums related to the company's Kansas business.Any special deposit required by this subsection shall be for the protectionand benefit of Kansas policyholders and claimants only and shall not bewithdrawn until the commissioner abrogates the requirements imposed by anyorder issued or agreement reached pursuant to the provisions of this section.The provisions of this subsection shall not apply to any insurance companyorganized under the laws of this state;
(6) require the company to maintain a general deposit with the commissionerof insurance in this state in cash or securities of the kinds authorizedby K.S.A. 40-2a01 et seq., and amendments thereto, if other than alife insurance company, or K.S.A. 40-2b01 and amendments thereto, if a lifeinsurance company unless such statutes specifically exclude such securitiesfor deposit. Any general deposit required by this subsection shall be inan amount designated by the commissioner for the protection and benefitof those persons and entities referred to inK.S.A. 40-3641and amendments thereto, and shall not be withdrawn until the commissionerabrogates the requirements imposed by any order issued or agreement reachedpursuant to the provisions of this section. The provisions of this subsectionshall only apply to insurance companies organized under the laws of this state.
(b) Whenever a guaranty fund, established pursuant to article 29 or30 of chapter 40 of the Kansas Statutes Annotated, is activated for theprotection of Kansas policyholders and claimants of an insurance companythat has made a special deposit under the provisions of this section, thecommissioner shall transfer the special deposit to such guaranty fund underan agreement approved by the commissioner which will provide protectionto all Kansas policyholders and claimants. Any funds from such special depositwhich remain after the payment of all claims and claims' expenses of Kansaspolicyholders and claimants shall be returned to the insurance supervisoryofficial of the company's state of domicile. If a Kansas domestic insurancecompany has made a deposit under the provisions of this section, anydistributionof such deposit shall be made in accordance with the provisions of K.S.A.40-3641 and amendments thereto.
History: L. 1972, ch. 177, § 1; L. 1986, ch. 169, § 1; L.1988, ch. 356, § 75;L. 1991, ch. 125, § 55; July 1.
