Kansas Statutes

Chapter 40: Insurance

Article 39: Cities And Counties, Payment Of Proceeds Of Fire Insurance Policies

Statutes:

• 40-3901: Cities; payment of proceeds of fire insurance policies; procedure; release of proceeds.
• 40-3902: Same; creating tax lien in proceeds of fire insurance policies.
• 40-3903: Counties; payment of proceeds of fire insurance policies; procedure; release of proceeds.
• 40-3904: Same; creating tax lien in proceeds of fire insurance policies.
• 40-3905: Cities and counties; notice to commissioner and insurance companies.
• 40-3906: Same; proof of repairing or rebuilding.
• 40-3907: Application to fire and explosion claims.
• 40-3908: Cities and counties not parties to insurance contract.
• 40-3909: Insurers immune.
• 40-3910: Commissioner; rules and regulations.

• 40-3901: Cities; payment of proceeds of fire insurance policies; procedure; release of proceeds. (a) The governing body of any city is hereby authorized to establish, by ordinance, a procedure for the payment of not to exceed 15% of the proceeds of any insurance policy based upon a covered claim payment made for damage or loss to a building or other structure, caused by or arising out of any fire, explosion or windstorm. The ordinance shall apply only to a covered claim payment which is in excess of 75% of the face value of the policy covering a building or other insured structure.

        (b)   The insurer first shall pay all amounts due the holder of a first real estate mortgage against the building or other structure pursuant to the terms of the policy and endorsements thereto and then shall withhold from the covered claim payment a sum not to exceed the amount authorized pursuant to subsection (a) and shall pay such moneys to the city to deposit into an interest-bearing account, unless the city has issued a certificate pursuant to K.S.A. 40-3906, and amendments thereto.

        (c)   The city shall release the insured's proceeds and any interest which has accrued on such proceeds received under subsection (b) within 30 days after receipt of such moneys, unless the city has instituted legal proceedings under the provisions of K.S.A. 12-1752, and amendments thereto. If the city has proceeded under the provisions of K.S.A. 12-1752, and amendments thereto, all moneys in excess of that necessary to comply with the provisions of K.S.A. 12-1750 et seq., and amendments thereto, for the removal of the building or structure, less salvage value, shall be paid to the insured.

        History:   L. 1982, ch. 192, § 2; L. 1997, ch. 102, § 2; July 1.

• 40-3902: Same; creating tax lien in proceeds of fire insurance policies. The governing body of any city is hereby authorized to create, by ordinance, a lien in favor of any such city in the proceeds of any insurance policy based upon a covered claim payment made for damage or loss to a building or other structure, caused by or arising out of any fire, explosion or windstorms. The lien arises upon any unpaid tax, special ad valorem levy, special assessment or other charge imposed upon real property by or on behalf of the city which is an encumbrance on real property, whether or not evidenced by written instrument, or such tax, levy, assessment, expense or other charge that has remained undischarged for at least one year prior to the filing of a proof of loss.

        History:   L. 1982, ch. 192, § 3; L. 1998, ch. 84, § 1; Apr. 16.

• 40-3903: Counties; payment of proceeds of fire insurance policies; procedure; release of proceeds. (a) The governing body of any county is hereby authorized to establish, by resolution, a procedure for the payment of not to exceed 15% of the proceeds of any insurance policy based upon a covered claim payment made for damage or loss to a building or other structure, caused by or arising out of any fire, explosion or windstorm. The resolution shall not apply to cities which have adopted an ordinance under the provisions of K.S.A. 40-3901, and amendments thereto. The resolution shall apply only to a covered claim payment which is in excess of 75% of the face value of the policy covering a building or other insured structure.

        (b)   The insurer first shall pay all amounts due the holder of a first real estate mortgage against the building or other structure pursuant to the terms of the policy and endorsements thereto and then shall withhold from the covered claim payment of the sum not to exceed the amount authorized pursuant to subsection (a) and shall pay such moneys to the county to deposit into an interest-bearing account, unless the city has issued a certificate pursuant to K.S.A. 40-3906, and amendments thereto.

        (c)   The county shall release the insured's proceeds and any interest which has accrued on such proceeds received under subsection (b) within 30 days after receipt of such moneys, unless the county has instituted legal proceedings, using the procedure under K.S.A. 12-1752, and amendments thereto, insofar as the same can be made applicable. If the county has instituted legal proceedings, all moneys in excess of that necessary for the removal of the building or structure, less salvage value, shall be paid to the insured.

        History:   L. 1982, ch. 192, § 4; L. 1997, ch. 102, § 3; July 1.

• 40-3904: Same; creating tax lien in proceeds of fire insurance policies. The governing body of any county is hereby authorized to create, by resolution, a lien in favor of any such county in the proceeds of any insurance policy based upon a covered claim payment made for damage or loss to a building or other structure, caused by or arising out of any fire, explosion or windstorms. The lien arises upon any unpaid tax, special ad valorem levy, special assessment or other charge imposed upon real property by or on behalf of the county which is an encumbrance on real property, whether or not evidenced by written instrument, or such tax, levy, assessment, expense or other charge that has remained undischarged for at least one year prior to the filing of a proof of loss. This resolution shall not apply to cities which have adopted an ordinance under the provisions of K.S.A. 40-3902 and amendments thereto.

        History:   L. 1982, ch. 192, § 5; L. 1998, ch. 84, § 2; Apr. 16.

• 40-3905: Cities and counties; notice to commissioner and insurance companies. Every city or county which adopts an ordinance or resolution under the provisions of K.S.A. 40-3901 through 40-3904, and amendments thereto shall notify the commissioner of insurance. At least once each quarter of each calendar year, the commissioner shall prepare and distribute a list of all cities and counties adopting an ordinance or resolution under the provisions of this act during the preceding quarter to all insurance companies which issue policies insuring buildings and other structures against loss by fire, explosion or windstorms. Insurance companies shall have 60 days after the commissioner notifies them of the adoption of such ordinance or resolution to establish procedures within such cities or counties to carry out the provisions of this act.

        History:   L. 1982, ch. 192, § 6; L. 1998, ch. 84, § 3; Apr. 16.

• 40-3906: Same; proof of repairing or rebuilding. Any city or county which has adopted an ordinance or resolution under K.S.A. 40-3901 to 40-3904, inclusive, is authorized to certify that in lieu of payment of all or part of the covered claim payment, it has obtained satisfactory proof that the insured has or will remove debris and repair, rebuild or otherwise make the premises safe and secure. In this event, the city or county shall issue a certificate to permit covered claim payment to the insured without deduction pursuant to subsection (b) of K.S.A. 40-3901 and subsection (b) of K.S.A. 40-3903.

        History:   L. 1982, ch. 192, § 7; July 1.

• 40-3907: Application to fire and explosion claims. This act shall apply to fire or explosion claims arising on all buildings or structures.

        History:   L. 1982, ch. 192, § 8; July 1.

• 40-3908: Cities and counties not parties to insurance contract. This act does not make any city or county a party to any insurance contract nor is the insurer liable to any party for any amount in excess of the proceeds otherwise payable under its insurance policy.

        History:   L. 1982, ch. 192, § 9; July 1.

• 40-3909: Insurers immune. Insurers complying with this act, or attempting in good faith to comply with this act, shall be immune from civil and criminal liability and such actions shall not be deemed in violation of K.S.A. 40-2404 and any amendments thereto, including withholding payment of any insurance proceeds pursuant to this act, or releasing or disclosing any information pursuant to this act.

        History:   L. 1982, ch. 192, § 10; July 1.

• 40-3910: Commissioner; rules and regulations. The commissioner of insurance is hereby authorized to promulgate rules and regulations necessary to carry out the provisions of this act.

        History:   L. 1982, ch. 192, § 11; July 1.