{"data":{"id":"us-ky/krs-164a.577","jurisdiction":"us-ky","citation":"KRS 164A.577","heading":"Private loss insurance or self -insurance pool option -- Requirements --","body":"Resumption of state insurance coverage -- Annual inspection -- Coverage\nrequirements and minimums.\n(1) Notwithstanding KRS 56.065 to 56.180 and any other law to the contrary:\n(a) Instead of insurance coverage provided through the Commonwealth's property\nand casualty insurance fund, the governing board of each institution may,\nsubject to paragraph (b) of this subsection, elect to obtain insurance under this\nsection to cover all of the state property in the institution's possession against\nloss by fire and other hazards;\n(b) An institution whose governing board elects to obtain insurance under this\nsection shall:\n1. Not be required to obtain approval by the Finance and Adm inistration\nCabinet or any other state agency or official to terminate the institution's\ninsurance coverage through the Commonwealth's property and casualty\ninsurance fund;\n2. Notify the secretary of the Finance and Administration Cabinet at least\nsixty (6 0) days before terminating the institution's insurance coverage\nthrough the Commonwealth's property and casualty insurance fund;\n3. Ensure that the insurance is in place immediately following termination\nof the institution's insurance coverage through the Commonwealth's\nproperty and casualty insurance fund;\n4. Comply with any bidding or advertising requirements under KRS\nChapters 45A and 424; and\n5. Comply with subsection (2) of this section; and\n(c) 1. An institution that terminates the institution's insurance coverage\nthrough the Commonwealth's property and casualty insurance fund\nunder this subsection shall be permitted to resume that coverage,\nwithout any need for approval by the Finance and Administr ation\nCabinet or any other state agency or official, by providing the following\nnotices to the secretary of the Finance and Administration Cabinet:\na. At least six (6) months prior to the effective date of the\ninstitution's resumption of coverage through t he Commonwealth's\nproperty and casualty insurance fund, as provided under\nsubparagraph 2. of this paragraph, a notice that the institution\nintends but is not obligated to resume coverage through the fund;\nand\nb. At least three (3) months prior to the effec tive date of the\ninstitution's resumption of coverage through the Commonwealth's\nproperty and casualty insurance fund, as provided under\nsubparagraph 2. of this paragraph, a notice that the institution is\nresuming coverage through the fund.\n2. Upon receipt  of the notices required under subparagraph 1. of this\nparagraph, the Finance and Administration Cabinet shall insure all of the\nstate property in the institution's possession against loss by fire and other\nhazards through the Commonwealth's property and c asualty insurance\nfund, and coverage shall become effective not later than:\na. The next date of renewal of the coverage provided through the\nfund; or\nb. Any other date agreed upon by the institution and the cabinet.\n(2) An institution that obtains insuranc e under this section shall ensure that an annual\ninspection is made of each state building and its contents in the institution's\npossession, for the purpose of determining the unnecessary causes of a fire hazard\ntherein, and recommendations are received for corrective actions, by either:\n(a) 1. Allowing the Finance and Administration Cabinet to have the inspection\nmade and to make recommendations for corrective actions, consistent\nwith the inspections and recommendations made under KRS 56.170.\n2. The institution shall pay a fee to the Finance and Administration Cabinet\nfor an inspection made under this paragraph if:\na. i. A fee is charged; and\nii. The fee is not in excess of the fee charged;\nto agencies for an inspection made under KRS 56.170; and\nb. The fee is reasonable; or\n(b) 1. Having a qualified third party approved by the institution's insurer\nconduct the inspection and make recommendations for corrective\nactions.\n2. The institution may pay a reasonable fee for an inspection made under\nthis paragraph if the fee is not included in the premium charged by the\ninsurer.\n(3) Insurance obtained under this section:\n(a) May be provided:\n1. By an authorized insurer as defined in KRS 304.1-100; or\n2. Through a self-insurance pool if the pool is:\na. Adequately reinsured by an authorized insurer as defined in KRS\n304.1-100; and\nb. Capable of insuring all of the state property in the institution's\npossession;\n(b) Shall state the following for each insured building and its contents:\n1. Estimated replacement cost; and\n2. The amount of coverage provided;\n(c) 1. Except as provided in subsection (4) of this section, shall insure each\nbuilding and its contents for an amount equal to one hundred percent\n(100%) of the replacement cost determined through a certified\nreplacement cost appraisal performed at the direction of the institution\nby an appraiser:\na. Licensed to perform appraisal services under KRS Chapter 324A;\nand\nb. Experienced in appraising commercial or governmental property.\n2. As used in this paragraph, \"replaceme nt cost\" includes the increased\ncost of construction brought about by code changes that:\na. Have occurred since the original structure was built; and\nb. Are required to be incorporated within a rebuilt structure;\n(d) Shall contain an agreed amount provision; and\n(e) Shall include:\n1. Ordinance and law coverage at not less than five million dollars\n($5,000,000);\n2. Debris removal coverage at not less than one million dollars\n($1,000,000);\n3. Extra expense coverage at not less than five million dollars\n($5,000,000); and\n4. For any building containing a steam boiler, boiler and machinery\ncoverage at not less than the total value of the real and personal property\nin the building in which the steam boiler is located.\n(4) A governing board may obtain actual cash v alue coverage of a building and its\ncontents if a certification signed by the governing board chair is attached to the\ninsurance policy or contract, or self -insurance pool contract, stating that it would\nnot be fiscally responsible to provide replacement c ost coverage for the building\nbeing insured.","path":["KRS Chapter 164A"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=56056","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:51:19Z","sha256":"60c2677c65095addc964c4b0c40f07044c0580862bc172c16658d2590b101c80","source_id":"us-ky","stale":false,"prev":"us-ky/krs-164a.575","next":"us-ky/krs-164a.580"},"notice":"GroundRules: Original legal text. Not legal advice."}