The basic property and casualty concepts are the same everywhere and are covered in the national basics guides. They include insurable interest, actual cash value and replacement cost, coinsurance, negligence and liability, and occurrence and claims-made coverage. This guide collects the Kansas rules that sit on top of them: the fault rule for liability claims, cancellation and nonrenewal, proof of loss and claim settlement, rate regulation, and the residual property market. Personal auto rules are in the Kansas personal auto guide.

Negligence: modified comparative fault (K.S.A. 60-258a)

Kansas uses modified comparative negligence:

• An injured claimant recovers only if the claimant's own negligence was less than that of the parties the claim is made against.
• Recovery is reduced by the claimant's percentage of fault.
• A claimant 50% or more at fault, meaning equal to or greater than the defendants, recovers nothing.

Cancellation and nonrenewal

Fire and casualty policies generally (K.A.R. 40-3-15):

• A policy the insurer may cancel at its option must promise at least 30 days' written notice before the cancellation date.
• The notice must give the date and say plainly that the policy is being cancelled.
• The rule doesn't apply to cancellation for nonpayment of premium, accident and health policies, or crop-hail policies.

Business policies (K.S.A. 40-2,120, 40-2,121). Once a business or professional property or casualty policy has been in force 90 days, it may be cancelled only for:

• nonpayment of premium
• material misrepresentation in obtaining the policy
• violation of material policy terms
• new unfavorable underwriting factors specific to the insured
• a Commissioner finding about the insurer's finances or its reinsurance

A rate increase for the class is not a valid reason. Nonrenewal of a business policy needs at least 60 days' written notice, which may come from the insurer or a licensed agent on its behalf.

Reasons in writing (K.S.A. 40-2,122). An insurer that cancels or nonrenews must give the insured a written explanation that specifically details the reasons. Statements made in good faith and without malice create no liability.

Proof of loss and claim settlement

Fire or tornado losses (K.S.A. 40-924):

• Within 10 days after notice and a written request, the insurer furnishes proof-of-loss blanks and directions.
• If it doesn't, the insured's lack of a proof of loss is no defense to a suit.
• The insured has a reasonable time to file after receiving the blanks.
• Furnishing blanks is not an admission of liability.

Claim settlement rules (K.A.R. 40-1-34, which adopts the NAIC model with Kansas changes):

• Repairs. Except in total losses, the insurer may not settle a first-party loss for less cash than the repair cost unless the insured agrees.
• Deadline notices. When negotiating directly with an unrepresented claimant, the insurer warns in writing that a time limit may be expiring. The notice comes at least 30 days ahead for a first-party claimant and 60 days ahead for a third-party claimant.
• Other responsible parties. A first-party claim may not be refused on the ground that someone else should pay, except as the policy allows.

Unfair claim practices (K.S.A. 40-2404(9)) are covered in the Kansas Insurance Regulation guide.

Applications and certificates (K.S.A. 40-955)

• On a property application for real property, the applicant may identify the mortgagee. On an auto application with physical damage coverage, the applicant may identify the lienholder.
• Certificates of insurance must use filed and approved forms and cannot amend the policy they describe.

Rates (K.S.A. 40-951 to 40-966)

• Rates may not be excessive, inadequate or unfairly discriminatory (40-953).
  • A rate is inadequate if it is clearly too low, with investment income, to cover projected losses and expenses.
  • Different premiums for different loss exposures are not unfair discrimination.
  • Kansas presumes a market is competitive unless the Commissioner finds otherwise after a hearing.
• Personal lines filings, such as homeowners and private auto, have a 30-day waiting period before use, subject to disapproval. Most commercial filings take effect on filing (40-955(d)).
• Workers' compensation loss costs need prior approval. They are deemed approved if not disapproved within 30 days.
• Excess or umbrella risks, large risks and designated special risks are exempt from filing (40-955(i)).
• Rating organizations are examined at least every five years (40-956).
• Preferred rates based on a fictitious grouping of risks are prohibited (K.A.R. 40-3-6). So is charging a different rate solely because of geographic location unless the filed rates allow it (K.A.R. 40-3-40).

Kansas FAIR plan (K.S.A. 40-2142)

• Purpose. The FAIR plan makes basic property insurance available to people who are entitled to it in good faith but can't get it in the voluntary market.
• Participation. Risks are spread among member insurers that have voluntarily elected to participate.
• Term. All FAIR plan policies are written for one year.
• Rates. Proposed rates can't be used until the Commissioner approves them. The Commissioner must rule within 60 days of filing, which may be extended by 30 days.

Other Kansas rules

• Electronic delivery (K.S.A. 40-5804).
  • Notices and documents may be sent electronically only if the party has affirmatively consented and not withdrawn consent.
  • An insurer that posts policy forms online must identify the exact forms on each declarations page.
  • Expired policies are archived for five years.
• Single-risk limit (K.S.A. 40-901). A Kansas fire and casualty insurer may not retain more than 10% of its paid-up capital and surplus on any one risk unless the excess is reinsured.
• Inland marine (K.A.R. 40-3-22).
  • The regulation defines what may be written as inland marine, such as personal articles floaters, builders' risk, bridges and tunnels, and wedding presents for up to 90 days.
  • Inland marine may not cover a manufacturer's goods while they are being made on its own premises.
  • Money and securities are covered only while in transit.

Common exam traps

• Kansas bars recovery when the claimant is 50% or more at fault, meaning equal to or greater than the defendants.
• The general cancellation notice is 30 days, and nonpayment is excluded from that rule.
• Business policies in force 90 days can be cancelled only for listed reasons. Business nonrenewal takes 60 days' notice.
• Proof-of-loss blanks are due within 10 days of a request.
• Personal lines rates wait 30 days before use.
• FAIR plan policies run one year, and insurers participate voluntarily.