1180             1997 Session Laws of Kansas             Ch. 170

An Act concerning insurance agents and brokers; providing for the licensing of agents;
regarding continuing education requirements; concerning the certification of agents by
companies; amending K.S.A. 40-241i and K.S.A. 1996 Supp. 40-240f and repealing the
existing sections.

Be it enacted by the Legislature of the State of Kansas:

Section 1. K.S.A. 1996 Supp. 40-240f is hereby amended to read as
follows: 40-240f. (a) For purposes of this section:

(1) ``Biennial due date'' means March 31, 1991, and March 31 of each
odd-numbered year thereafter. Effective January 1, 1997, the term shall
mean the date of birth of the licensed agent who is required to complete
C.E.C.'s and report the completion of such C.E.C.'s to the commissioner
pursuant to this section, except that such due date shall not be earlier
than two years from the date of the agent's initial licensure.

(2) ``Approved subject'' or ``approved course'' means any educational
presentation involving insurance fundamentals, insurance law, insurance
policies and coverage, insurance needs, insurance risk management, in-
surance agency management or other areas, which is offered in a class,
seminar or other similar form of instruction, and which has been approved
by the commissioner or the commissioner's designee under this section
as expanding skills and knowledge obtained prior to initial licensure or
developing new and relevant skills and knowledge.

(3) ``C.E.C.'' means continuing education credit. One C.E.C. is at
least 50 minutes of each clock hour of instruction or the C.E.C. value
assigned by the commissioner or the commissioner's designee. The
C.E.C. values shall be assigned in whole units. The commissioner or the
commissioner's designee shall assign a C.E.C. value to each approved
subject on a case-by-case basis.

(4) ``Biennium'' means the period beginning on the effective date of
this section and ending on March 31, 1991, and each two-year period
thereafter. Effective January 1, 1997, for those agents who were born in
an odd-numbered year, the term shall mean the period starting with the
agent's biennial due date in 1997 and each two-year period thereafter,
for those agents who were born in an even-numbered year, the term shall
mean the period starting with the agent's biennial due date in 1998 and
each two-year period thereafter.

(5) ``Inactive agent'' means a licensed agent who presents evidence

Ch. 170             1997 Session Laws of Kansas             1181

satisfactory to the commissioner which demonstrates that such agent will
not do any act toward transacting the business of insurance for not less
than two but not more than six years from the date such evidence is
received by the commissioner. Such additional periods may be granted
by the commissioner upon further presentation of evidence satisfactory
to the commissioner.

(b) (1) Every licensed agent who is an individual and holds a property
or casualty qualification, or both, shall biennially obtain a minimum of
twelve C.E.C.'s in courses certified as property and casualty which, on
and after April 1, 1995, shall include at least one hour of instruction in
insurance ethics. No more than three C.E.C.'s shall be in insurance
agency management.

(2) Every licensed agent who is an individual and holds a life, accident
and health, or variable contracts qualification, or any combination thereof,
shall biennially complete twelve C.E.C.'s in courses certified as life, ac-
cident and health, or variable contracts which, on and after April 1, 1995,
shall include at least one hour of instruction in insurance ethics. No more
than three C.E.C.'s shall be in insurance agency management.

(3) Every licensed agent who is an individual and holds a crop only
qualification shall biennially obtain a minimum of two C.E.C.'s in courses
certified as crop under the property and casualty category.

(4) Every licensed agent who is an individual and is licensed only for
title insurance shall biennially obtain a minimum of four C.E.C.'s in
courses certified by the board of abstract examiners as title under the
property and casualty category.

(5) Every licensed agent who is an individual and holds a life insur-
ance license solely for the purpose of selling life insurance or annuity
products used to fund a prearranged funeral program and whose report
of compliance required by subsection (f) of this section is accompanied
by a certification from an officer of each insurance company represented
that the agent transacted no other insurance business during the period
covered by the report shall biennially obtain a minimum of two C.E.C.'s
in courses certified as life or variable contracts under the life, accident
and health, or variable contracts category.

(c) Individual agents who hold licenses with both a property or ca-
sualty qualification, or both, and a life, accident and health, or variable
contracts qualification, or any combination thereof, and who earn C.E.C.'s
from courses certified by the commissioner or the commissioner's des-
ignee as qualifying for credit in any class, may apply those C.E.C.'s toward
either the property or casualty continuing education requirement or to
the life, accident and health, or variable contracts continuing education
requirement. However, a C.E.C. shall not be applied to satisfy both the
biennial property or casualty requirement, or both, and the biennial re-
quirement for life, accident and health, or variable contracts, or any com-
bination thereof.

1182             1997 Session Laws of Kansas             Ch. 170

(d) An instructor of an approved subject shall be entitled to the same
credit as a student completing the study.

(e) (1) An individual agent who has been licensed for more than one
year shall, on or before the biennial due date, file a report with the com-
missioner that such agent has met the continuing education requirements
for the previous biennium ending on such biennial due date. Every in-
dividual agent shall maintain a record of all courses attended together
with a certificate of attendance for the remainder of the biennium in
which the courses were attended and the entire biennium immediately
following.

(2) If the required report showing proof of continuing education
completion is not received by the commissioner by the biennial due date,
the individual agent's qualification and corresponding license or licenses
shall be automatically suspended for a period of 90 calendar days or until
such time as the agent satisfactorily demonstrates completion of the con-
tinuing education requirement whichever is sooner and a penalty of $100
shall be assessed for each license suspended. If the required proof of
continuing education completion and the monetary penalty is not fur-
nished within 90 calendar days of the biennial due date, the individual
agent's qualification and corresponding license or licenses will expire. The
commissioner may waive the penalties of this subsection upon written
application by the agent in cases of extreme hardship.

(3) An applicant for an individual agent's license who previously held
a license which expires on or after May 1, 1989, because of failure to meet
continuing education requirements and who seeks to be relicensed shall
pass the examination required for issuance of the new qualification and
license and provide evidence that appropriate C.E.C.'s have been com-
pleted for the prior biennium.

(4) An applicant for an individual agent's license who previously held
a license which expired on or before April 30, 1989, for failure to meet
the minimum educational requirements contained in K.S.A. 40-240b, and
amendments thereto, as it existed prior to the passage of this act and who
seeks to be relicensed shall pass the examination required for issuance of
the new license.

(5) Upon written application by an individual agent, the commis-
sioner may, in cases involving medical hardship or military service, extend
the time within which to fulfill the minimum continuing educational
requirements for a period of not to exceed 180 days.

(6) This section shall not apply to inactive agents as herein defined
during the period of such inactivity. Upon return to active status or ex-
piration of the maximum inactive period, the agent shall have the re-
mainder of the current calendar year plus the next calendar year to com-
ply with the continuing education requirement.

(f) (1) A course, program of study, or subject shall be submitted to

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and certified by the commissioner or the commissioner's designee in or-
der to qualify for purposes of continuing education.

(2) The following information shall be furnished with each request
for certification:

(A) Name of provider or provider organization;

(B) course title;

(C) date course will be offered;

(D) location where course will be offered;

(E) outline of the course including a schedule of times when subjects
will be presented;

(F) names and qualifications of instructors;

(G) number of C.E.C.'s requested; and

(H) a nonrefundable course fee in the amount of $50 per course or
$250 per year for all courses, and a nonrefundable annual provider fee of
$100.

(3) Upon receipt of such information, the commissioner or commis-
sioner's designee shall grant or deny certification as an approved subject
and indicate the number of C.E.C.'s that will be recognized for the sub-
ject. Each approved subject or course shall be assigned by the commis-
sioner or commissioner's designee to one or both of the following classes:

(A) Property and casualty or

(B) life insurance (including annuity and variable contracts) and ac-
cident and health insurance.

(4) A course or subject shall have a value of at least one C.E.C.

(5) A provider seeking approval of a course for continuing education
credit shall provide for the issuance of a certificate of attendance to each
person who attends a course offered by it. The certificate shall be signed
by either the course instructor or the provider's authorized representa-
tive. Providers shall also maintain a list of all persons who attend courses
offered by them for continuing education credit for the remainder of the
biennium in which the courses are offered and the entire biennium im-
mediately following.

(6) The commissioner may grant approval to specific programs of
study that have appropriate merit, such as programs with broad national
or regional recognition, notwithstanding the lack of a request for certifi-
cation. The fee prescribed by subsection(f)(2)(H) of this section shall not
apply to approvals granted hereunder.

(7) The C.E.C. value assigned to any course, program of study or
subject, other than a correspondence course or other course pursued by
independent study, shall in no way be contingent upon passage or satis-
factory completion of any examination given in connection with such
course, program of study or subject.

(g) The commissioner shall provide, upon request, a list of all ap-
proved continuing education courses currently available to the public.

(h) An individual agent who studies an insurance subject indepen-

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dently, other than an agent's examination, approved by the commissioner
or commissioner's designee, and who passes an independently monitored
examination, shall receive credit for the C.E.C.'s assigned by the com-
missioner or commissioner's designee as recognition for the approved
subject. No other credit shall be given for independent study.

(i) The commissioner may waive the continuing education require-
ments imposed by this act for nonresident agents who provide evidence
of compliance with continuing education requirements imposed by their
state of domicile.

Sec. 2. K.S.A. 40-241i is hereby amended to read as follows: 40-241i.
(a) Any company authorized to transact business in this state may, upon
determining that the agent is of good business reputation and, if an in-
dividual, has had experience in insurance or will immediately receive a
course of instruction in insurance and on the policies and policy forms of
such company, certify such agent as the agent of the company under the
license in effect for the agent. The certification shall be made to the
commissioner on a form prescribed by the commissioner within 15 30
days of appointment of the agent by the company. Such appointment
shall be effective immediately and shall remain in effect until May 1,
unless the commissioner is notified to the contrary or the license of the
certified agent is terminated. The A nonrefundable certification fee set
forth in K.S.A. 40-252, and amendments thereto, shall be paid in accord-
ance with the billing procedures established by the commissioner. The
certification fee shall not be returned for any reason, and failure of the
company to certify an agent within 15 30 working days of such agent's
appointment shall subject the company to a penalty of not more than $25
per calendar day from the date of appointment to the date proper certi-
fication is recorded by the insurance department.

(b) Certification of other than an individual agent will automatically
include each licensed insurance agent who is an officer, director, partner,
employee or otherwise legally associated with the corporation, association,
partnership or other legal entity appointed by the company. The required
annual certification fee shall be paid for each licensed agent certified by
the company at the time of the original certification of the agency and
any continuation thereof.

(c) With respect to insurance on growing crops, evidence satisfactory
to the commissioner that the agent is qualified to transact insurance in
accordance with standards or procedures established by any branch of
the federal government shall be deemed to be the equivalent of certifi-
cation by a company.

(d) Duly licensed insurance agents transacting business in accordance
with the provisions of article 41 of chapter 40 of the Kansas Statutes
Annotated, and amendments thereto, shall be deemed to be certified by

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a company for the kinds of insurance permitted under the license in effect
for the agent.

Sec. 3. K.S.A. 40-241i and K.S.A. 1996 Supp. 40-240f are hereby
repealed.

Sec. 4. This act shall take effect and be in force from and after its
publication in the statute book.

Approved May 15, 1997.