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Planning for Kentucky’s 2027 virtual-currency kiosk rules

Kentucky’s 2026 SB 189 creates a licensing and safeguarding framework for virtual-currency kiosk operators, but its core requirements take effect April 30, 2027. A kiosk operator preparing a renewal should map outstanding customer transactions, permitted investments, agent controls and 72-hour cancellation procedures now; these statutory safeguards do not mean an insurance policy will pay a customer loss. 1,2

What Is Digital Assets?

Digital-asset coverage may address custody, theft and business-liability risks, but a custodian’s policy may protect the custodian rather than you. If you hold or safeguard assets, verify the insured entity, wallets, key-loss protection and valuation. Read the national Digital assets guide.

Kentucky Requirements

RequirementDetails
Plan for April 30, 2027Kentucky’s enacted Chapter 126 and current KRS chapter index list the new virtual-currency kiosk provisions with an effective date of April 30, 2027. Build the transition into the relevant application and renewal cycle. 1,2
Reconcile outstanding transactionsThe act requires kiosk operators, when effective, to maintain permitted investments at least equal to aggregate outstanding transactions and treats those investments as trust property for purchasers or holders in specified insolvency proceedings. 1

What to Watch for in Kentucky

  • The law is enacted but not yet effective

    As of September 28, 2026, the cited kiosk provisions are scheduled for April 30, 2027. Do not describe their requirements as already operative. 1,2

  • The new-customer process has conditions

    The act gives a new customer a 72-hour cancellation/refund route or requires an operator delay; it also defines new-customer timing and transaction limits. Check those conditions in the full act before setting customer procedures. 1

  • Statutory security is not the same as insurance

    The act’s permitted-investment and security provisions address operator obligations, not a blanket promise of coverage for the operator or its customers. 1,3

Who Regulates Insurance in Kentucky

Kentucky Department of Insurance

The Kentucky Department of Insurance licenses agents and insurers, monitors the insurance market, and accepts complaints about insurance companies and agents. You can use its state lookup or complaint service to check a license or raise an insurance issue. 5,6,7

Surplus-lines tax and stamping office

Reported tax rate: 3% on Kentucky-home-state premiums and other premium consideration; separate 1.8% surcharge on eligible risks located in Kentucky, subject to statutory exceptions; applicable local-government premium tax may also apply When Kentucky is the insured's home state, the state tax is 3% of premium and other consideration treated as premium; local-government premium taxes may also apply. A separate 1.8% surcharge generally applies to Kentucky risks, but state law exempts multistate nonadmitted risks and specified government and nonprofit premiums. The broker must make a diligent effort to place coverage with an admitted carrier before using surplus lines. 8,11,9,10,12

Providers With Documented State Licenses

No provider in Spot’s research documents both a state license record and this coverage line. This does not establish that providers are unlicensed. Check the regulator’s license lookup and confirm availability with a provider when requesting a quote.

Questions to Ask Before You Buy in Kentucky

  1. Will your business be the licensed kiosk operator, an agent, a location host or a technology vendor under the Kentucky act?
  2. Can your records reconcile outstanding customer transactions to assets held by each entity and wallet?
  3. Which assets are under direct control versus a sub-custodian, and who bears a shortfall or unauthorized-transfer loss?
  4. Ask the broker to review customer asset, employee/crime and key-control exposures separately from the act’s reserve and security requirements.

Digital Assets in Kentucky: FAQ

When do Kentucky’s virtual-currency kiosk requirements take effect? 1,2

The 2026 act and the current chapter index state an effective date of April 30, 2027. Treat this as a transition task until that date. 1,2

Do Kentucky’s required investments guarantee insurance recovery? 1,4

No. The act describes investments held for outstanding transactions and their treatment in specified insolvency proceedings. It is not a policy grant and does not establish that a separate insurer will reimburse losses. 1,4

Digital Assets in Other States

Other Coverage in Kentucky

Sources

  1. 2026 Kentucky Senate Bill 189, Chapter 126. Kentucky General Assembly; 2026 enrolled Act, §§ kiosk operator licensure, permitted investments, agents, customer hold/refund; effective-date section. Accessed 2026-09-28.
  2. Kentucky Revised Statutes, Chapter 286.13. Kentucky General Assembly; Current chapter index updated September 28, 2026; §§286.13-010, -015, -025 effective April 30, 2027. Accessed 2026-09-28.
  3. Insurance. BitGo; Current page: custody and key-control description; direct-insured entity and location/entity eligibility qualifiers. Accessed 2026-09-28.
  4. Performance Management — Supplemental Requirements & Guidance. Lloyd’s; January 2020, pp.44–46: historic underwriting considerations for key security, hot/cold storage, code/network risk, insured identity and valuation; historical market guidance only. Accessed 2026-09-28.
  5. Kentucky Department of Insurance. Kentucky Department of Insurance; Homepage and consumer telephone. Accessed 2026-09-28.
  6. Insurance License Lookup. Kentucky Department of Insurance; State-designated producer/company search. Accessed 2026-09-28.
  7. File an Insurance Complaint. Kentucky Department of Insurance; Official DOI consumer complaint page accepts complaints involving general liability and disputes with insurers, agents or adjusters. Accessed 2026-09-28.
  8. KRS 304.10-180. Kentucky General Assembly; KRS 304.10-180(1): Kentucky-home-state; 3% applies to premiums, assessments, fees, charges or other premium consideration; local premium tax is separate. Accessed 2026-09-28.
  9. Local Government Premium Taxes. Kentucky Department of Insurance; Current local tax schedules. Accessed 2026-09-28.
  10. KRS 304.10-090. Kentucky General Assembly; KRS 304.10-090 requires policy notice that nonadmitted insurer is not a Kentucky Insurance Guaranty Association member and its benefits are unavailable upon insolvency. Accessed 2026-09-28.
  11. KRS 136.392. Kentucky General Assembly; KRS 136.392(1),(5)-(6): $1.80 per $100 on premium/other charges for Kentucky risks; named government/nonprofit exceptions; multistate nonadmitted risks exempt. Accessed 2026-09-28.
  12. Surplus Lines. Kentucky Department of Insurance; Full page states licensed surplus-lines brokers must make a diligent effort to place with an admitted carrier before exporting coverage. Accessed 2026-09-28.
  13. Licenses. At-Bay; Current producer introduction and state table; At-Bay Insurance Services LLC; P&C and surplus-lines identifiers. Accessed 2026-09-21.
  14. Licenses and Carriers. Coalition; Licenses and Carriers, re-read 22 September 2026: Insurance Licenses table for Coalition Insurance Solutions, Inc., national producer number 18419475, with producer and surplus-lines numbers for all 50 states and DC including California 0L76155, Georgia 196479, Texas 2199630 and 2205589, Pennsylvania 815731 and 817452, Colorado 539028 and Wisconsin 3000108852. Insurance Carriers table naming, with NAIC numbers, Allianz Underwriters Insurance Company 36420, Arch Specialty Insurance Company 21199, Ascot Specialty Insurance Company 45055, Ascot Insurance Company 23752, Aspen Specialty Insurance Company 10717, Chaucer Insurance Company DAC, Coalition Insurance Company 29530, Fireman's Fund Indemnity Corporation 11380, Fortegra Specialty Insurance Company 16823, Lloyd's of London, MSIG Specialty Insurance USA Inc. 34886, MS Transverse Specialty Insurance Company 41807, Steadfast Insurance Company 26387, Vantage Risk Specialty Insurance Company 16275 and Zurich American Insurance Company 16535. Accessed 2026-09-22.
  15. Insurance Producer Licenses. Corgi Insurance; Current complete Insurance Producer Licenses table for Corgi Insurance Services, Inc.; 50 rows covering 49 states and DC (DC 3003091619); no New Mexico row; no NPN or as-of date shown. Accessed 2026-09-28.
  16. About Hiscox US Insurance. Hiscox; Hiscox Insurance Company Inc. NAIC 10200 as Chicago, IL domiciled insurer admitted or licensed in all 50 states and D.C.; Hiscox Inc. as general agent and Lloyd’s coverholder for Syndicates 33 and 3624; surplus-lines placements through licensed surplus-lines brokers; A.M. Best rating statement. Accessed 2026-09-16.
  17. Licenses. ERGO NEXT Insurance; Current entity-by-state license table reopened 28 September 2026: 50 rows under Next First Insurance Agency, Inc., including Washington, DC; New York rows instead list Next Insurance Services PC-1423070 and AP Intego BR-1198885. Accessed 2026-09-28.
  18. Insurance Licenses by State. TechInsurance; Current state table; identifies TechInsurance as a division of Specialty Program Group LLC d/b/a SPG Insurance Solutions; lists DC 3000041536 and labels Rhode Island “Individual licenses,” without an agency license number. Accessed 2026-09-28.
  19. Licenses. Vouch; Effective 16 January 2025: Vouch Specialty Insurance Services, LLC, NPN 19926463; P&C table (50 states and DC); surplus-lines table includes Idaho 870820; footnote says Georgia and Idaho do not issue agency-level surplus-lines licenses; Idaho retained as producer-only due to conflict. Accessed 2026-09-15.

Updated .

This guide is informational and does not determine whether a policy is available or meets your needs. Editorial policy. To suggest a correction, contact Spot with a supporting source.

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