Assignment of Benefits – Blog Series, Part 15: Kansas

In this installation of my series on Assignment of Benefits (AOBs), we’ll be looking at AOBs in Kansas and how the courts have dealt with them.

Back in 1962, in Alldritt v. Kansas Centennial Global Exposition, the Supreme Court of Kansas held that a breach of contract claim was assignable.¹ Long before that in 1874, the Court held in Life Insurance Co. v. Kelso, that a “first-party claim for damages against a life insurance company for breach of an insurance contract was assignable.”²

More recently, the Court tackled the debate over whether a bad faith claim was assignable. In Glenn v. Fleming, the Kansas Supreme Court overruled the its prior decision in Heinson v. Porter, and held that “an insured’s breach of contract claim for bad faith or negligent refusal to settle may be assigned.”³ In making their determination, the court listed the following as arguments for permitting the assignments:

(1) Breach of contract actions are not personal to the insured; (2) the insured is prevented from filing bankruptcy when faced with an excess judgment; (3) the injured plaintiff is compensated; (4) settlements between the injured plaintiff and the insured are fostered; (5) the injured plaintiff is allowed to sue the insurer directly, thus simplifying the process; and (6) the possibility of collusion between the injured plaintiff and the insured is not increased.⁴

If you have any specific questions on AOBs or would like to see your state come up sooner, please comment below, or send me an email at cmathis@merlinlawgroup.com.

As always, I’ll leave you with a (mildly) related tune, here’s Kansas with their hit, Carry On Wayward Son:

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¹ Alldritt v. Kansas Centennial Global Exposition, 189 Kan. 649, 657 (1962).
² Glenn v. Fleming, 247 Kan. 296, 313 (1990) citing Life Insurance Co. v. Kelso, 16 Kan. 481, 485 (1874).
³ Glenn v. Fleming, 247 Kan. at 314.
⁴ Id. citing 12 A.L.R.3d at 1161–63.