Sen. William R. Haine

Filed: 4/24/2007

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 484

2     AMENDMENT NO. ______. Amend Senate Bill 484, AS AMENDED, by
3 replacing everything after the enacting clause with the
4 following:
 
5     "Section 5. The Illinois Insurance Code is amended by
6 changing Section 143.17a as follows:
 
7     (215 ILCS 5/143.17a)  (from Ch. 73, par. 755.17a)
8     Sec. 143.17a. Notice of intention not to renew.
9     (a) A company intending to nonrenew any policy of insurance
10 to which Section 143.11 applies, except for those defined in
11 subsections (a), (b), (c), and (h) of Section 143.13, must mail
12 written notice to the named insured at least 60 days prior to
13 the expiration date of the current policy. In all notices of
14 intention not to renew any policy of insurance, as defined in
15 Section 143.11, the company shall provide a specific
16 explanation of the reasons for nonrenewal. A company may not

 

 

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1 extend the current policy period for purposes of providing
2 notice of its intention not to renew required under this
3 subsection (a). a. No company shall fail to renew any policy of
4 insurance, to which Section 143.11 applies, except for those
5 defined in subsections (a), (b), (c), and (h) of Section
6 143.13, unless it shall send by mail to the named insured at
7 least 60 days advance notice of its intention not to renew. The
8 company shall maintain proof of mailing of such notice on one
9 of the following forms: a recognized U.S. Post Office form or a
10 form acceptable to the U.S. Post Office or other commercial
11 mail delivery service. An exact and unaltered copy of such
12 notice shall also be sent to the insured's broker, if known, or
13 the agent of record and to the mortgagee or lien holder at the
14 last mailing address known by the company. However, where
15 cancellation is for nonpayment of premium, the notice of
16 cancellation must be mailed at least 10 days before the
17 effective date of the cancellation.
18     (b) A company intending to renew any policy of insurance to
19 which Section 143.11 applies, except for those defined in
20 subsections (a), (b), (c), and (h) of Section 143.13, with an
21 increase in premium of 30% or more or with changes in
22 deductibles or coverage that materially alter the policy must
23 mail or deliver to the named insured written notice of such
24 increase or change in deductible or coverage at least 60 days
25 prior to the renewal or anniversary date. If a company has
26 failed to provide notice of intention to renew required under

 

 

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1 this subsection (b) at least 60 days prior to the renewal or
2 anniversary date, but does so no less than 31 days prior to the
3 renewal or anniversary date, the company may extend the current
4 policy at the current terms and conditions for the period of
5 time needed to equal the 60 day time period required to provide
6 notice of intention to renew by this subsection (b). The
7 increase in premium shall be the renewal premium based on the
8 known exposure as of the date of the quotation compared to the
9 premium as of the last day of coverage for the current year's
10 policy, annualized. The premium on the renewal policy may be
11 subsequently amended to reflect any change in exposure or
12 reinsurance costs not considered in the quotation. b. This
13 Section does not apply if the company has manifested its
14 willingness to renew directly to the named insured. Provided,
15 however, that no company may increase the renewal premium on
16 any policy of insurance to which Section 143.11 applies, except
17 for those defined in subsections (a), (b), (c), and (h) of
18 Section 143.13, by 30% or more, nor impose changes in
19 deductibles or coverage that materially alter the policy,
20 unless the company shall have mailed or delivered to the named
21 insured written notice of such increase or change in deductible
22 or coverage at least 60 days prior to the renewal or
23 anniversary date. The increase in premium shall be the renewal
24 premium based on the known exposure as of the date of the
25 quotation compared to the premium as of the last day of
26 coverage for the current year's policy, annualized. The premium

 

 

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1 on the renewal policy may be subsequently amended to reflect
2 any change in exposure or reinsurance costs not considered in
3 the quotation. An exact and unaltered copy of such notice shall
4 also be sent to the insured's broker, if known, or the agent of
5 record. If an insurer fails to provide the notice required by
6 this subsection, then the company must extend the current
7 policy under the same terms, conditions, and premium to allow
8 60 days notice of renewal and provide the actual renewal
9 premium quotation and any change in coverage or deductible on
10 the policy. Proof of mailing or proof of receipt may be proven
11 by a sworn affidavit by the insurer as to the usual and
12 customary business practices of mailing notice pursuant to this
13 Section or may be proven consistent with Illinois Supreme Court
14 Rule 236.
15     (c) A company that has failed to provide notice of
16 intention to nonrenew under subsection (a) of this Section and
17 has failed to provide notice of intention to renew as
18 prescribed under subsection (b) of this Section must renew the
19 expiring policy under the same terms and conditions for an
20 additional year or until the effective date of any similar
21 insurance is procured by the insured, whichever is earlier. The
22 company may increase the renewal premium. However, such
23 increase must be less than 30% of the expiring term's premium
24 and notice of such increase must be delivered to the named
25 insured on or before the date of expiration of the current
26 policy period. c. Should a company fail to comply with the

 

 

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1 non-renewal notice requirements of subsection a., the policy
2 shall be extended for an additional year or until the effective
3 date of any similar insurance procured by the insured,
4 whichever is less, on the same terms and conditions as the
5 policy sought to be terminated, unless the insurer has
6 manifested its intention to renew at a different premium that
7 represents an increase not exceeding 30%.
8     (d) Under subsection (a), the company shall maintain proof
9 of mailing of the notice of intention not to renew to the named
10 insured on one of the following forms: a recognized U.S. Post
11 Office form or a form acceptable to the U.S. Post Office or
12 other commercial mail delivery service. Under subsections (b)
13 and (c), proof of mailing or proof of receipt of the notice of
14 intention to renew to the named insured may be proven by a
15 sworn affidavit by the company as to the usual and customary
16 business practices of mailing notice pursuant to this Section
17 or may be proven consistent with Illinois Supreme Court Rule
18 236. For all notice requirements under this Section, an exact
19 and unaltered copy of the notice to the named insured shall
20 also be sent to the named insured's producer, if known, or the
21 producer of record. For notices of intention to not renew, an
22 exact and unaltered copy of the notice to the named insured
23 shall also be sent to the mortgagee or lien holder at the last
24 mailing address known by the company. d. Renewal of a policy
25 does not constitute a waiver or estoppel with respect to
26 grounds for cancellation which existed before the effective

 

 

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1 date of such renewal.
2     (e) Renewal of a policy does not constitute a waiver or
3 estoppel with respect to grounds for cancellation that existed
4 before the effective date of such renewal. e. In all notices of
5 intention not to renew any policy of insurance, as defined in
6 Section 143.11 the company shall provide a specific explanation
7 of the reasons for nonrenewal.
8     (f) For purposes of this Section, the named insured's
9 producer, if known, or the producer of record and the mortgagee
10 or lien holder may opt to accept notification electronically.
11 f. For purposes of this Section, the insured's broker, if
12 known, or the agent of record and the mortgagee or lien holder
13 may opt to accept notification electronically.
14 (Source: P.A. 93-477, eff. 8-8-03; 93-713, eff. 1-1-05.)".