Kentucky Revised Statutes Title XXV. Business and Financial Institutions § 304.47-080.Insurers to maintain investigative units

(1) Every insurer admitted to do business in the Commonwealth shall maintain effective procedures and resources to deter and investigate fraudulent insurance acts prohibited by this subtitle, including a unit that will investigate suspected fraudulent insurance acts. For the purpose of this section, “insurer” does not include reinsurers or reinsurance as defined in KRS 304.5-130.

(2) Insurers may maintain the unit required by subsection (1) of this section, using its employees or by contracting with others for that purpose.

(3) Insurers shall establish the unit required by this section no later than July 15, 1995.

(4) The unit may include the assignment of fraud investigation to employees whose principal responsibilities are the investigation and disposition of claims. If an insurer creates a distinct unit, hires additional employees, or contracts with another entity to fulfill the requirements of this article, the additional cost incurred shall be included as an administrative expense.