Kansas Insurance Department
Proposed Revisions to K.A.R. 40-3-22
K.A.R. 40-3-22. Marine, inland marine, or
and transportation insurance. (a) Risks and coverages which coverage
that may be classified under Kansas insurance laws as marine, inland marine,
or transportation insurance shall be those contained specified in
this regulation. The This regulation does shall not
limit the insuring powers granted under charters and licenses.
(b) Unless
otherwise permitted, marine, inland marine, or and transportation
insurance may shall not insure any of the following:
(1) Storage
of insured's merchandise, unless specially permitted below by this
regulation;
(2) merchandise
during manufacture, which that is the property of the
manufacturer and is on the manufacturer's premises;
(3) furniture
and fixtures, or other improvements to buildings; or
(4) money
and securities stored in safes, vaults, and safety deposit vaults at any
bank, or on the insured's premises, except while being transported.
(c) A
Any marine, inland marine, or transportation policy may insure the
following:
(1) Imported
property wherever located, provided if the coverage includes
risks of transportation. Property qualifies shall qualify for
coverage as an import if it the property maintains its separate
identity and has not become mixed with other property in general commerce until
one of the following occurs:
(A) The
property is sold or delivered by the importer;
(B) the
property is taken from its place of storage and put on sale as part of the
importer's stock in trade at any sale or distribution point; or
(C) the
property is delivered for manufacture, processing, or change in form.;
(2) exported
property wherever located, provided if the coverage includes
risks of transportation. Property shall qualify for coverage as an export when
if it meets the following conditions:
(A) Is
designated for export or is being prepared for export; and
(B) has
not been diverted for domestic trade.;
(3) a
domestic shipment which that begins and ends within the provided if the coverage includes risks of transportation,
including the following:
(A) Property
on consignment while it is:
(i) for sale or distribution;
(ii)
for exhibit, trial, approval, or
auction; or
(iii)
in transit,; in the
custody of others,; or being returned. Coverage shall not apply to property while on
any premises owned, leased, or operated by the consignor.;
(B) property
which that is not on consignment, except under either of the
following conditions:
(i) When
The property is on any manufacturing premises; or
(ii) after
arrival the property has arrived at any premises owned, leased,
or operated by the insured or purchaser.;
(4) an
instrumentality of transportation or communication, excluding buildings and
their improvements, furniture, furnishings, ordinary contents, and
stored supplies. Instrumentalities of transportation or communication shall
include the following:
(A) Bridges,
tunnels, or and similar transportation facilities,
including their auxiliary structures and equipment;
(B) piers,
wharves, docks, slips, dry docks, or and marine railways;
(C) pipelines,
including on-line propulsion, regulating, and other related appurtenant
equipment, and excluding property at manufacturing, producing,
refining, converting, treating, or conditioning plants;
(D) power
transmissions transmission lines or telephone and telegraph
lines, excluding all property at generating, converting, or transforming
stations, substations, and exchanges;
(E) radio
and television communication equipment, including towers and antennae with
their auxiliary equipment and appurtenant electrical operating and control
apparatus; and
(F) outdoor
cranes, loading bridges, or similar equipment used for loading, unloading,
and transport.;
(5) a
policy for an individual, such as including the following:
(A) A
personal effects policy;
(B) a
personal property policy;
(C) a
government service policy;
(D) a
personal fur policy;
(E) a
personal jewelry policy;
(F) a
wedding present policy, for up to 90 days after the wedding day;
(G) a
silverware policy;
(H) a
fine arts art policy, insuring paintings, etchings, pictures,
tapestries, art glass windows, and other works of art which have
rarity, that are rare or that have historical value or artistic
merit;
(I) a
stamp and coin policy;
(J) a
musical instrument policy. A “Musical instrument” shall
not include a radio, television, or record player, or any
combination of them. these items;
(K) a
mobile articles policy covering identified property of a mobile nature usual
common to a household. A floater shall not cover furniture and fixtures
that are customarily used on the premises where the property is usually kept;
(L) a
machinery and equipment policy, except for policies covering motor vehicles,
auto homes, trailers, or semi-trailers semitrailers
designed for highway use. Trailers or semi-trailers semitrailers
hauled by a tractor not designed for highway use can may be
covered under this policy, however.;
(M) an
installment sales and leased property policy covering property, except for
motor vehicles designed for highway use, that is in transit and is meets
either of the following conditions:
(i) Is
sold under a conditional contract of sale, partial payment contract,
or installment sales contract; or
(ii) is
leased. These policies This policy shall not cover beyond the
termination of seller's or lessor's interest in the property; or
(N) a
live animal policy.; or
(6) a
commercial property policy for business or professions such as ,
including the following:
(A) A
radium policy;
(B) a
physicians' and surgeons' instrument policy. The policy may also cover
furniture, fixtures, and the insured's interest in improvements to
buildings located in those portions of the premises occupied by the insured for
professional purposes;
(C) a
pattern and die policy;
(D) a
theatrical policy, but. However, the policy shall not cover
buildings and their improvements nor and furniture and fixtures
that do not travel with theatrical troupes;
(E) a
film policy covering either of the following:
(i) A
film during production; or
(ii) a
completed negative, positive, and sound recording;
(F) a
salesmen's samples policy;
(G) a
an exhibition policy covering property while on exhibition and while in
transit to or from an exhibition;
(H) a
live animal policy;
(I) a
builders' risk or installation risk policy, covering machinery, equipment,
building materials, or supplies being used with and during installation, testing,
building, renovating, or repairing. A policy may cover property
designated for and awaiting specific installation, building, renovating,
or repairing under any of the following conditions:
(i) While
at a point or place where work is being performed;
(ii) while
in transit; or
(iii) during
temporary storage or deposit. The policy shall cover against perils in addition
to fire and extended coverage perils. Coverage shall cease when an insured
owner completes and accepts the building or installation and the insured seller
seller’s or contractor's interests interest ceases.;
(J) a
mobile articles policy covering identified property of a mobile nature which
that is in the custody or control of a party who intends to use the
property for its manufactured or created purpose. The policy shall not cover
furniture and fixtures that are not customarily used away from the premises
where the property is usually kept;
(K) a
machinery and equipment policy, except for a motor vehicle or snow plow
designed for highway use, an auto home, or a trailer or semitrailer unless
hauled by a tractor not designed for highway use;
(L) a
bailment policy covering property in the custody of any bailee and while in
transit to or from the bailee. Any
bailment policy may include coverage that will indemnify the owner of the
property for loss from specific perils subject to approval by the commissioner
of insurance pursuant to K.S.A. 40-216(a) and amendments thereto. The
application of an additional or separate charge for the indemnity coverage
shall not constitute the transaction of the business of insurance if the charge
does not exceed the premium approved by the commissioner and the bailee and if
the bailee's employees or other organizations receive no compensation or other
valuable consideration for performing the administrative tasks associated with
the insurance coverage. The policy
shall not insure property if either of the following conditions is met:
(i) The
property is owned by the bailee at the bailee's premises; or
(ii) the
property is in the custody of any bailee owned, controlled, or
operated by the bailor;
Bailment policies may include coverage which will
indemnify the owner of the property for loss from such perils as are enumerated
and subject to such terms and conditions as the commissioner of insurance has
approved. The application of an additional or separate charge for the indemnity
coverage shall not constitute the transaction of the business of insurance if
such charge is not in excess of the premium approved by the commissioner and
the bailee, the bailee's employees or other associations receive no
compensation or other valuable consideration for performing the administrative
tasks associated with the insurance coverage.
(M) an
installment sales and leased property policy covering property, except a motor
vehicle designed for highway use, that is in transit and is meets
either of the following conditions:
(i) Is
sold under a conditional contract of sale, partial payment contract, or
installment sales contract; or
(ii) is
leased. The policy shall not cover any point beyond the termination of
the seller's or lessor's interest in the property, nor and shall not
cover machinery and equipment subject to certain “lease-back” contracts. A “lease-back” contracts mean contracts
contract shall mean a contract, expressed or implied, under which the
property is purchased by the lessor for the benefit and use of the lessor. This
provision does shall not apply to “lease-back” contracts
involving machinery and equipment for which marine or inland marine coverage is
otherwise permitted by this definition while the machinery and equipment is
are in the custody of the lessee.;
(N) a
garment contractors policy;
(O) a
furrier or fur storer policy covering specified articles belonging to a
customer for which the furrier or fur storer issues a certificate or receipt to
the customer;
(P) an
accounts receivable policy and valuable papers and records policy;
(Q) a
floor plan policy covering property for sale, except for an automobile or other
motor vehicle designed for highway use, while in transit and while in
possession of any dealer under a plan by which the dealer borrows money from a
bank or lending institution with which to pay the manufacturer. In addition, the
following conditions requirements shall be met:
(i) The
property shall be specifically identifiable as encumbered to the bank or
lending institution;
(ii) the
dealer's right to sell or otherwise dispose of the property shall be
conditioned upon its being released from encumbrance by the bank or lending
institution; and
(iii) the
policy shall not cover any point beyond the termination of the dealer's
interest in the property;
(R) a sign
and street clock policy. The policy may include insurance of a neon sign, an
automatic or mechanical sign, and a street clock while in use.;
(S) a
fine arts art policy for the account of a museum, gallery,
university, business, municipality, or other similar interest, covering
paintings, etchings, pictures, tapestries, art glass windows, and other
works of art which have rarity, that are rare or have historical
value or artistic merit;
(T) a
dealers policy insuring a dealer in personal property which that may
be covered specifically under an inland marine policy by the ultimate purchaser,
including. A policy under this paragraph may cover money stored
in locked safes or vaults on the insured's premises, furniture, fixtures,
tools, machinery, patterns, molds, dies, and
the insured's interest as a tenant in improvements to buildings. This
policy may include the following:
(i) Any
musical instrument dealer covering property consisting principally of musical
instruments and their accessories. Musical instruments do shall not
include radios, televisions, record players, and any combinations
of them these items;
(ii) any
camera dealer covering property consisting principally of cameras and their
accessories;
(iii) any
furriers fur dealer covering property consisting principally of
furs and fur garments;
(iv) any
equipment dealer covering mobile agricultural and construction equipment and
accessories, except for motor vehicles designed for highway use;
(v) any
stamp or coin dealer covering property of a philatelic or numismatic nature;
(vi) any
jeweler's block; and
(vii) any
fine arts art dealer.;
A policy under this paragraph may cover money stored
in locked safes or vaults on the insured's premises, furniture, fixtures,
tools, machinery, patterns, molds, dies and insured's interest as a tenant in
improvements to buildings.
(U) a
wool growers woolgrower’s policy;
(V) a
domestic bulk liquid policy, covering tanks and domestic bulk liquids stored in
them;
(W) a
difference-in-conditions policy. The policy shall not insure
against fire and extended coverage perils; and
(X) any
electronic data processing policy. (Authorized by K.S.A. 40-103, 40-937(d);
implementing K.S.A. 40-925, 40-926, K.S.A. 1990 Supp. 40-927, 40-928 40-901;
effective Jan. 1, 1966; amended Jan. 1, 1967; amended May 1, 1986; amended Jan.
6, 1992; amended P- _______________.)