Kansas House Bill HB2323

Kansas 2025-2026 Regular Session

• Introduced: 2/7/25
• Refer: 2/7/25
• Report Pass: 2/17/25
• Engrossed: 2/25/25
• Refer: 2/26/25
• Report Pass: 3/13/26
• Enrolled: 3/26/26
• Passed: 4/9/26

Caption

Establishing procedures for a civil action instituted by the commissioner of insurance related to fraudulent insurance acts, providing that expunged criminal records will be disclosed in any application for licensure as an insurance producer or public adjuster if the arrest, conviction or diversion is for a fraudulent insurance act and including automobile assigned claims plans in provisions related to fraudulent insurance acts.

Summary

HB 2323 expands Kansas insurance fraud enforcement tools in two main ways. First, it authorizes the Kansas insurance commissioner to bring a civil action in district court against a person believed to have committed a fraudulent insurance act, with the commissioner bearing the burden of proof by a preponderance of the evidence. If the court finds fraud, it may impose civil penalties of up to $10,000 per fraudulent act, order restitution to an insurer or automobile assigned claims plan, require reimbursement of the department’s investigation expenses, and grant other appropriate relief. The bill also allows testimony by two-way audio-video communication and permits compelled testimony or document production with use immunity in later criminal cases, subject to the usual perjury or contempt exceptions. Second, the bill amends Kansas expungement law to require disclosure of expunged arrests, convictions, or diversions when a person applies for licensure as an insurance producer or public adjuster if the underlying matter involved one or more fraudulent insurance acts. It also adds automobile assigned claims plans throughout the fraudulent insurance act statutes, making them part of the reporting, restitution, and enforcement framework. The bill updates the definition and penalties for fraudulent insurance acts and preserves immunity for good-faith reporting of suspected fraud. The bill’s impact on state law is to create a parallel civil enforcement pathway for insurance fraud, supplementing existing criminal penalties with commissioner-initiated civil remedies and clearer recovery mechanisms for insurers and the state. It also narrows the practical effect of expungement in the insurance licensing context by requiring disclosure of certain expunged fraud-related records, while leaving most other expungement protections intact. In addition, it clarifies that automobile assigned claims plans are protected entities that may receive restitution and fraud-related reporting under the insurance code. The overall sentiment reflected in the voting history is strongly supportive. The House passed the bill 122-1, the Senate later passed it 40-0, and the House concurred with amendments 122-0. That voting pattern suggests broad bipartisan agreement that the bill strengthens anti-fraud enforcement and protects insurers, claimants, and the insurance system. There is little evidence of major public contention in the available record, but the most likely points of concern are the bill’s expanded disclosure requirement for expunged records and the commissioner’s new civil enforcement powers. Those provisions could raise privacy, rehabilitation, and due-process concerns for people seeking insurance producer or public adjuster licenses, while supporters would view them as necessary safeguards against repeat fraud in a regulated industry.

Impact

The bill amends Kansas statutes governing fraudulent insurance acts and expungement. It adds a new civil cause of action for the insurance commissioner, authorizes civil penalties, restitution, and recovery of investigation costs, and extends fraudulent insurance act provisions to automobile assigned claims plans. It also modifies K.S.A. 21-6614 so that expunged records must still be disclosed in insurance producer and public adjuster licensing applications when the underlying arrest, conviction, or diversion involved fraudulent insurance acts. The bill further updates K.S.A. 40-2,118 and 40-2,119 and repeals the existing versions of those statutes.

Sentiment

The bill appears to have enjoyed very strong support throughout the legislative process. Final passage votes were overwhelmingly favorable in both chambers, with only one no vote in the House and unanimous approval in the Senate and on House concurrence. The available record suggests a consensus that the measure is a targeted anti-fraud enforcement bill rather than a controversial policy shift.

Contention

No committee transcript is available, so specific debate points are not documented in the provided materials. Based on the text, the most likely areas of contention are the new requirement to disclose expunged records for insurance licensing when the offense involved fraudulent insurance acts, and the commissioner’s authority to pursue civil penalties and compel testimony. Those provisions may be viewed by critics as burdensome for applicants or expansive in enforcement power, while supporters likely see them as necessary to deter fraud and protect consumers and insurers.