16 February 2022ILS

Kansas amends captive law for TEFFIs

The Kansas Senate has approved an insurance bill updating its Captive Insurance Act. Senate Bill 377 authorises “technology-enabled fiduciary financial institution” (TEFFI) insurance companies to operate as captives in Kansas.

The change follows the TEFFI Act, a law passed last year to bolster the state’s alternative asset industry. It was proposed by Beneficient Company, which provides liquidity solutions and other financial services for alternative asset funds. The Act allows for the creation of trust banks (TEFFIs), which as fiduciaries finance alternative assets held in Kansas trusts and provide qualified custodial and trustee services within the state.

The change allows TEFFI insurance companies to provide contracts of suretyship or credit insurance where the obligee or insured is an affiliated TEFFI, fidfin trust or other affiliated company and insure affiliated companies invested in funds against liability, loss, or damage.

To date, Beneficient is the only TEFFI within Kansas.