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Kansas insurance law lacks private cause of action
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To the editor:

In the state of Kansas, insured individuals find themselves at the mercy of insurance companies without any viable means of recourse for breaches of the Unfair Claims Settlement Act. The absence of a private cause of action not only places insureds in a vulnerable position but also limits their ability to assert their rights when insurance companies violate Kansas insurance laws. There is urgent need to change Kansas law, allowing insureds to file lawsuits against their insurance providers in cases of unfair claims settlements. By doing so, Kansas can empower individuals to protect their interests and ensure that insurance companies are held accountable.

The Dominance of Insurance Companies

Currently, insured individuals in Kansas face an unjust imbalance of power in their dealings with insurance companies. While the state has enacted the Unfair Claims Settlement Act to regulate insurer conduct, the absence of a private cause of action significantly weakens its effectiveness.

Insureds are left without legal recourse, as they must rely solely on the Kansas Insurance Commissioner against an insurance company found in violation. This places undue trust in a single entity and restricts insureds’ ability to assert their rights independently.

Insufficient Oversight by the Commissioner

The responsibility of enforcement laws falls on the Insurance Commissioner and the Insurance Department. However, they have broad discretion in deciding whether to pursue legal action. This leaves insureds vulnerable to inconsistent enforcement and potential bias. Even when violations are identified, the Commissioner may choose not to hold insurance companies accountable, leaving insureds with limited options for seeking justice.

The Need for a Private Cause of Action

So, Kansas law must be amended to allow insureds to file lawsuits against insurance companies. This would empower insureds to assert their rights in cases where their insurance providers fail to act in good faith. This would introduce accountability into the insurance industry and provide a stronger deterrent against unfair claims settlements

Benefits of a Private Cause of Action

This would have numerous benefits: First, it would provide a more level playing field, ensuring that insurance companies are held accountable for their actions. Insureds would no longer have to rely solely on the discretion of the Insurance Commissioner, allowing them to actively protect their interests and seek fair compensation. Moreover, it would act as a deterrent, forcing insurance companies to comply with the law to avoid potential litigation. This would foster a more transparent and ethical insurance industry in Kansas, benefitting both insureds and insurers alike.

The Role of Public Adjusters

In addition, Kansas law currently prohibits insureds from hiring public adjusters to assist them in navigating 1st party insurance claims. This goes against the public interest by preventing insureds from accessing professional assistance in understanding their rights and negotiating with insurance companies. Public adjusters possess specialized knowledge and can level the playing field by advocating for insureds.

Allowing insureds to hire public adjusters would enhance their ability to protect their rights under the insurance contract and ensure a fair and just claims settlement process.

Kansas Insurance Law Must be Amended

The absence of a private cause of action, coupled with the restriction on hiring public adjusters, creates an unjust imbalance of power between insured individuals and insurance companies. Kansas law must amended to rectify these and provide insureds the means to protect their rights and assert their claims. By doing so, Kansas can ensure justice, fairness, and the public interest. Empowering insureds to take legal action and access professional assistance would restore balance in the insurance industry, foster trust, and uphold the principles of justice in the state.

Lonnie LuPardus

pro se plaintiff in LuPardus vs Homesite Indemnity Co. in Johnson County