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40-2c01. Risk-based capital requirements; definitions. As used in this act:

(a) "Adjusted RBC report" means an RBC report that has been adjusted by the commissioner in accordance with K.S.A. 40-2c04, and amendments thereto.

(b) "Corrective order" means an order issued by the commissioner specifying corrective actions that the commissioner has determined are required to address an RBC level event.

(c) "Domestic insurer" means any insurance company or risk retention group that is licensed and organized in this state.

(d) "Foreign insurer" means any insurance company or risk retention group not domiciled in this state that is licensed or registered to do business in this state pursuant to article 41 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto, or K.S.A. 40-209, and amendments thereto.

(e) "NAIC" means the national association of insurance commissioners.

(f) "Life and health insurer" means any insurance company licensed under article 4 or 5 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto, or a licensed property and casualty insurer writing only accident and health insurance.

(g) "Property and casualty insurer" means any insurance company licensed under articles 9, 10, 11, 12, 12a, 15 or 16 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto, but shall not include monoline mortgage guaranty insurers, financial guaranty insurers and title insurers.

(h) "Negative trend" means, with respect to a life and health insurer, a negative trend over a period of time, as determined in accordance with the "trend test calculation" included in the RBC instructions defined in subsection (j).

(i) "RBC" means risk-based capital.

(j) "RBC instructions" means the risk-based capital instructions promulgated by the NAIC that are in effect on December 31, 2020, or any later version promulgated by the NAIC as may be adopted by the commissioner under K.S.A. 40-2c29, and amendments thereto.

(k) "RBC level" means an insurer's company action level RBC, regulatory action level RBC, authorized control level RBC, or mandatory control level RBC where:

(1) "Company action level RBC" means, with respect to any insurer, the product of 2.0 and its authorized control level RBC;

(2) "regulatory action level RBC" means the product of 1.5 and its authorized control level RBC;

(3) "authorized control level RBC" means the number determined under the risk-based capital formula in accordance with the RBC instructions; and

(4) "mandatory control level RBC" means the product of 0.70 and the authorized control level RBC.

(l) "RBC plan" means a comprehensive financial plan containing the elements specified in K.S.A. 40-2c06, and amendments thereto. If the commissioner rejects the RBC plan, and it is revised by the insurer, with or without the commissioner's recommendation, the plan shall be called the "revised RBC plan."

(m) "RBC report" means the report required by K.S.A. 40-2c02, and amendments thereto.

(n) "Total adjusted capital" means the sum of:

(1) An insurer's capital and surplus or surplus only if a mutual insurer; and

(2) such other items, if any, as the RBC instructions may provide.

(o) "Commissioner" means the commissioner of insurance.

History: L. 1994, ch. 138, § 1; L. 1996, ch. 134, § 1; L. 1997, ch. 53, § 1; L. 1998, ch. 15, § 1; L. 1999, ch. 31, § 1; L. 2000, ch. 170, § 8; L. 2001, ch. 61, § 1; L. 2002, ch. 158, § 22; L. 2003, ch. 21, § 1; L. 2004, ch. 159, § 7; L. 2005, ch. 28, § 1; L. 2006, ch. 122, § 1; L. 2007, ch. 40, § 1; L. 2008, ch. 134, § 3; L. 2009, ch. 83, § 21; L. 2010, ch. 108, § 3; L. 2011, ch. 15, § 1; L. 2012, ch. 19, § 1; L. 2013, ch. 38, § 1; L. 2014, ch. 16, § 1; L. 2015, ch. 24, § 2; L. 2016, ch. 16, § 1; L. 2017, ch. 8, § 1; L. 2018, ch. 13, § 1; L. 2019, ch. 46, § 2; L. 2020, ch. 10, § 3; L. 2021, ch. 108, § 5; July 1.

Revisor’s Note:

Section was amended twice identically in the 2008 session, see also 40-2c01a.

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