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Insurance Commissioner Vicki Schmidt outlines consumer recoveries, protections for vulnerable adults and legislative proposals
Summary
Insurance Commissioner Vicki Schmidt updated the Senate FINI committee on department outreach, consumer recoveries, implementation of last year's vulnerable‑adult protections, and proposed bills including an insurance savings account, civil penalties for fraud, and a real‑time insurance verification system.
Insurance Commissioner Vicki Schmidt gave the Senate FINI committee a broad update on the Kansas Insurance Department’s consumer assistance work, outreach efforts and several legislative proposals the department is advancing this year.
Schmidt said the department’s mission is to “regulate, educate, and advocate,” and she described prior legislative changes that reduced the cost of doing business in Kansas. She cited several dollar figures tied to departmental fee reductions and other measures since she took office, saying those changes have reduced costs to businesses and producers and that the department has lowered certain licensing fees and assessments.
On consumer assistance, Schmidt said the department’s Consumer Assistance Division has returned money to Kansans each year and that the office’s total recoveries since she took office exceed $145 million. She credited expanded outreach — including participation in the state fair, free continuing education for agents, and the SmartInvestKS program — with increasing public awareness and contacts to the department.
Schmidt briefed the committee on implementation of last year’s House Bill 2562 (the vulnerable‑adults financial exploitation reporting law), which took effect July 1, 2024. She told the committee the department has received 58 reports under that statute involving roughly $1.6 million; three of those matters have been opened by the department for potential violations of the Uniform Securities Act, and all 58 reports were referred to adult protective services and law enforcement as appropriate.
Schmidt outlined several bills the department is sponsoring this session. Key proposals described in testimony include:
- An insurance savings account that would allow Kansans to set aside funds, tax free, for property‑and‑casualty premiums and deductibles; Schmidt said it would be among the first such programs in the nation and would give households a new way to prepare for insurance costs tied to homeownership or disaster needs.
- Authority to impose civil penalties and administrative sanctions for insurance fraud inside the department, in addition to criminal referrals to the attorney general. Schmidt said civil penalties would allow the department to document misconduct and pursue repeat offenders administratively while preserving criminal prosecution as an option.
- A real‑time insurance verification system to give law enforcement, courts and the Department of Revenue a tool to identify uninsured drivers and reduce payments insurers make for uninsured‑motorist claims. Schmidt said a department data call showed insurers paid about $51 million in uninsured‑motorist claims in 2021–2022.
Schmidt said the department is also proposing regulatory efficiencies, including eliminating certain producer appointment renewal fees (a revenue reduction she estimated at $6.5 million) and reducing the state premium tax rate from 2% to 1.98% for items the department characterizes as pass‑through collections.
Committee members asked for more detail about Medicare Advantage plan complaints and prior authorization. Schmidt said the department has no enforcement authority over Medicare Advantage because those plans are federally regulated; she said the department forwards complaints to CMS and is collecting data to inform federal partners and congressional delegations. On the topic of telemarketing and enrollment calls to seniors, Schmidt said the department fields complaints and that a federal remedy would be needed but that referrals and data collection help inform federal action.
Representative Steens and others thanked Schmidt for work on HB 2562; Schmidt said the new reporting framework has helped stop potentially fraudulent transactions and that the department has opened investigations when warranted. The committee had no further questions and moved on to other business.
Schmidt closed by reiterating the department’s focus on recovering funds for Kansans, pursuing bad actors, and reducing regulatory fees to lower costs for consumers and businesses.
