Full Text of HB1954 100th General Assembly
HB1954sam001 100TH GENERAL ASSEMBLY | Sen. Linda Holmes Filed: 5/5/2017
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| 1 | | AMENDMENT TO HOUSE BILL 1954
| 2 | | AMENDMENT NO. ______. Amend House Bill 1954 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | changing Sections 143.14, 143.15, 143.17, and 143.17a as | 6 | | follows:
| 7 | | (215 ILCS 5/143.14) (from Ch. 73, par. 755.14)
| 8 | | Sec. 143.14. Notice of cancellation.
| 9 | | (a) No notice of cancellation of any
policy of insurance, | 10 | | to which
Section 143.11 applies, shall be effective unless | 11 | | mailed by the company
to the named insured and the mortgage or | 12 | | lien holder, at the last mailing
address known by the company.
| 13 | | The company shall maintain proof of mailing of such notice on a | 14 | | recognized
U.S. Post Office form or a form acceptable to the U. | 15 | | S. Post Office or
other commercial mail delivery service. | 16 | | Notification A
copy of all such
notices shall also be sent to |
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| 1 | | the insured's broker if known, or the agent of
record, if | 2 | | known, and to the mortgagee or lien holder listed on the policy | 3 | | at the last mailing
address
known to the company . For purposes | 4 | | of this Section, the mortgage or lien holder, insured's broker, | 5 | | if known, or the agent of record may opt to accept notification | 6 | | electronically.
| 7 | | (b) Whenever a financed insurance contract is cancelled, | 8 | | the insurer
shall return
whatever gross unearned premiums are | 9 | | due
under the insurance contract or contracts not to exceed the | 10 | | unpaid balance
due the premium finance company directly to the | 11 | | premium finance
company effecting the cancellation for the | 12 | | account of the named insured.
The return premium must be mailed | 13 | | to the premium finance company within
60 days.
The request for | 14 | | the unearned premium by the premium finance company shall
be in | 15 | | the manner of a monthly account, current accounting by | 16 | | producer,
policy number, unpaid balance and name of insured for | 17 | | each cancelled amount.
In the event the insurance contract or | 18 | | contracts are subject to audit, the
insurer shall retain the | 19 | | right to withhold the return of the portion of
premium that can | 20 | | be identified to the contract or contracts until the audit
is | 21 | | completed. Within 30 days of the completion of the audit, if a | 22 | | premium
retained by the insurer after crediting the earned | 23 | | premium would result in
a surplus, the insurer shall return the | 24 | | surplus directly to the premium
finance company. If the audit | 25 | | should result in an additional premium due
the insurer, the | 26 | | obligation for the collection of this premium shall fall
upon |
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| 1 | | the insurer and not affect any other contract or contracts | 2 | | currently
being financed by the premium finance company for the | 3 | | named insured.
| 4 | | (c) Whenever a premium finance agreement contains a power | 5 | | of attorney
enabling the premium finance company to cancel any | 6 | | insurance contract or contracts
in the agreement, the insurer | 7 | | shall honor the date of cancellation as set
forth in the | 8 | | request from the premium finance company without requiring the
| 9 | | return of the insurance contract or contracts. The insurer may | 10 | | mail to the
named insured an acknowledgment of the notice of | 11 | | cancellation from the
premium finance company but the named | 12 | | insured shall not incur any
additional premium charge for any | 13 | | extension of coverage. The insurer need
not maintain proof of | 14 | | mailing of this notice.
| 15 | | (d) All statutory regulatory and contractual restrictions | 16 | | providing that
the insurance contract may not be cancelled | 17 | | unless the required notice is
mailed to a governmental agency, | 18 | | mortgagee, lienholder, or other third
party shall apply where | 19 | | cancellation is effected under a power of
attorney under a | 20 | | premium finance agreement. The insurer shall have the
right for | 21 | | a premium charge for this extension of coverage.
| 22 | | (Source: P.A. 93-713, eff. 1-1-05.)
| 23 | | (215 ILCS 5/143.15) (from Ch. 73, par. 755.15)
| 24 | | Sec. 143.15. Mailing of cancellation notice. All notices of
| 25 | | cancellation of insurance as
defined in subsections (a), (b) |
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| 1 | | and (c) of Section 143.13 must
be mailed at least 30 days prior | 2 | | to the effective date of
cancellation to the named insured and | 3 | | mortgagee or lien holder,
if known, at the last mailing address | 4 | | known to the company. All
notices of cancellation to the named | 5 | | insured shall include a specific explanation of
the reason or | 6 | | reasons for cancellation. However, where cancellation
is for | 7 | | nonpayment of premium, the notice of
cancellation must be | 8 | | mailed at least 10 days before the effective date of the
| 9 | | cancellation. For purposes of this Section, the mortgagee or | 10 | | lien holder, if known, may opt to accept notification | 11 | | electronically.
| 12 | | (Source: P.A. 93-713, eff. 1-1-05.)
| 13 | | (215 ILCS 5/143.17) (from Ch. 73, par. 755.17)
| 14 | | Sec. 143.17. Notice of intention not to renew.
| 15 | | a. No company shall fail
to renew any policy of insurance, | 16 | | as defined in subsections (a), (b),
(c), and (h) of Section | 17 | | 143.13, to which Section 143.11 applies, unless it
shall
send | 18 | | by mail to the named insured at least 30 days advance notice of | 19 | | its
intention not to renew. The company shall maintain proof of | 20 | | mailing of
such notice on a recognized U.S. Post Office form or | 21 | | a form acceptable to
the U. S. Post Office or other commercial | 22 | | mail delivery service. The nonrenewal shall not become | 23 | | effective until at least 30 days from the proof of mailing date | 24 | | of the notice to the name insured. Notification An exact
and | 25 | | unaltered copy of such notice shall also be sent to the |
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| 1 | | insured's
broker, if known, or the agent of record and to any | 2 | | the mortgagee or lien
holder listed on the policy at the last | 3 | | mailing address known by the company . For purposes of this | 4 | | Section, the mortgagee or lien holder, insured's broker, or the | 5 | | agent of record may opt to accept notification electronically. | 6 | | However, where
cancellation is for nonpayment of premium, the | 7 | | notice
of
cancellation must be mailed at least 10 days before | 8 | | the
effective date of the cancellation.
| 9 | | b. This Section does not apply if the company has | 10 | | manifested its
willingness to renew directly to the named | 11 | | insured.
Such written notice shall specify the premium amount | 12 | | payable, including
any premium payment plan available, and the | 13 | | name of any person or persons,
if any, authorized to receive | 14 | | payment on behalf of the company. If no
person is so | 15 | | authorized, the premium notice shall so state. The notice of
| 16 | | nonrenewal and the proof of mailing shall be effected on the | 17 | | same date.
| 18 | | b-5. This Section does not apply if the company manifested | 19 | | its
willingness to renew directly to the named insured. | 20 | | However, no company may
impose changes in deductibles or | 21 | | coverage for any policy forms applicable to an
entire line of | 22 | | business enumerated in subsections (a), (b), (c), and (h) of
| 23 | | Section 143.13 to which Section 143.11 applies unless the | 24 | | company mails to the
named insured written notice of the change | 25 | | in deductible or coverage at least
60 days prior to the renewal | 26 | | or anniversary date. Notice An exact and unaltered copy
of the |
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| 1 | | notice shall also be sent to the insured's broker, if known, or | 2 | | the
agent of record.
| 3 | | c. Should a company fail to comply with (a) or (b) of this | 4 | | Section,
the policy shall terminate only on the effective date | 5 | | of any similar
insurance procured by the insured with respect | 6 | | to the same subject or
location designated in both policies.
| 7 | | d. Renewal of a policy does not constitute a waiver or | 8 | | estoppel with
respect to grounds for cancellation which existed | 9 | | before the effective
date of such renewal.
| 10 | | e. In all notices of intention not to renew any policy of | 11 | | insurance,
as defined in Section 143.11 the company shall | 12 | | provide the named insured a specific
explanation of the reasons | 13 | | for nonrenewal.
| 14 | | f. For purposes of this Section, the insured's broker, if | 15 | | known, or the agent of record and the mortgagee or lien holder | 16 | | may opt to accept notification electronically.
| 17 | | (Source: P.A. 93-713, eff. 1-1-05.)
| 18 | | (215 ILCS 5/143.17a) (from Ch. 73, par. 755.17a)
| 19 | | Sec. 143.17a. Notice of intention not to renew.
| 20 | | (a) A company intending to nonrenew any policy of insurance | 21 | | to which Section 143.11 applies, except for those defined in | 22 | | subsections (a), (b), (c), and (h) of Section 143.13, must mail | 23 | | written notice to the named insured at least 60 days prior to | 24 | | the expiration date of the current policy. The notice to the | 25 | | name insured shall provide a specific explanation of the |
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| 1 | | reasons for nonrenewal. In all notices of intention not to | 2 | | renew any policy of insurance, as defined in Section 143.11, | 3 | | the company shall provide a specific explanation of the reasons | 4 | | for nonrenewal. A company may not extend the current policy | 5 | | period for purposes of providing notice of its intention not to | 6 | | renew required under this subsection (a).
| 7 | | (b) A company intending to renew any policy of insurance to | 8 | | which Section 143.11 applies, except for those defined in | 9 | | subsections (a), (b), (c), and (h) of Section 143.13, with an | 10 | | increase in premium of 30% or more or with changes in | 11 | | deductibles or coverage that materially alter the policy must | 12 | | mail or deliver to the named insured written notice of such | 13 | | increase or change in deductible or coverage at least 60 days | 14 | | prior to the renewal or anniversary date. If a company has | 15 | | failed to provide notice of intention to renew required under | 16 | | this subsection (b) at least 60 days prior to the renewal or | 17 | | anniversary date, but does so no less than 31 days prior to the | 18 | | renewal or anniversary date, the company may extend the current | 19 | | policy at the current terms and conditions for the period of | 20 | | time needed to equal the 60 day time period required to provide | 21 | | notice of intention to renew by this subsection (b). The | 22 | | increase in premium shall be the renewal premium based on the | 23 | | known exposure as of the date of the quotation compared to the | 24 | | premium as of the last day of coverage for the current year's | 25 | | policy, annualized. The premium on the renewal policy may be | 26 | | subsequently amended to reflect any change in exposure or |
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| 1 | | reinsurance costs not considered in the quotation.
| 2 | | (c) A company that has failed to provide notice of | 3 | | intention to nonrenew under subsection (a) of this Section and | 4 | | has failed to provide notice of intention to renew as | 5 | | prescribed under subsection (b) of this Section must renew the | 6 | | expiring policy under the same terms and conditions for an | 7 | | additional year or until the effective date of any similar | 8 | | insurance is procured by the insured, whichever is earlier. The | 9 | | company may increase the renewal premium. However, such | 10 | | increase must be less than 30% of the expiring term's premium | 11 | | and notice of such increase must be delivered to the named | 12 | | insured on or before the date of expiration of the current | 13 | | policy period.
| 14 | | (d) Under subsection (a), the company shall maintain proof | 15 | | of mailing of the notice of intention not to renew to the named | 16 | | insured on one of the following forms: a recognized U.S. Post | 17 | | Office form or a form acceptable to the U.S. Post Office or | 18 | | other commercial mail delivery service. Under subsections (b) | 19 | | and (c), proof of mailing or proof of receipt of the notice of | 20 | | intention to renew to the named insured may be proven by a | 21 | | sworn affidavit by the company as to the usual and customary | 22 | | business practices of mailing notice pursuant to this Section | 23 | | or may be proven consistent with Illinois Supreme Court Rule | 24 | | 236. For all notice requirements under this Section, an exact | 25 | | and unaltered copy of the notice to the named insured shall | 26 | | also be sent to the named insured's producer, if known, or the |
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| 1 | | producer of record. Notification For notices of intention to | 2 | | not renew, an exact and unaltered copy of the notice to the | 3 | | named insured shall also be sent to the mortgagee or lien | 4 | | holder listed on the policy at the last mailing address known | 5 | | by the company .
| 6 | | (e) Renewal of a policy does not constitute a waiver or | 7 | | estoppel with respect to grounds for cancellation that existed | 8 | | before the effective date of such renewal.
| 9 | | (f) For purposes of this Section, the named insured's | 10 | | producer, if known, or the producer of record and the mortgagee | 11 | | or lien holder may opt to accept notification electronically.
| 12 | | (Source: P.A. 95-533, eff. 6-1-08 .)
| 13 | | Section 99. Effective date. This Act takes effect January | 14 | | 1, 2018.".
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