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Public Act 096-1450 |
HB5217 Enrolled | LRB096 17690 RPM 33053 b |
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AN ACT concerning insurance.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Insurance Code is amended by |
changing Sections 187, 209, 531.03, 531.04, 531.05, 531.06, |
531.07, 531.08, 531.09, 531.10, 531.11, 531.12, 531.14, |
531.18, 537.2, and 545 and by adding Section 206.1 as follows:
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(215 ILCS 5/187) (from Ch. 73, par. 799)
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Sec. 187. Scope of Article.
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(1) This Article shall apply to every corporation, |
association, society,
order, firm, company, partnership, |
individual, and aggregation of
individuals to which any Article |
of this Code is applicable, or which is
subject to examination, |
visitation or supervision by the Director under any
provision |
of this Code or under any law of this State, or which is |
engaging
in or proposing or attempting to engage in or is |
representing that it is
doing an insurance or surety business, |
or is undertaking or proposing or
attempting to undertake to |
provide or arrange for health care services as a
health care |
plan as defined in subsection (7) of Section 1-2 of the Health
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Maintenance Organization Act, including the exchanging of |
reciprocal or
inter-insurance contracts between individuals, |
partnerships and corporations in
this State, or which is in the |
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process of organization for the purpose of doing
or attempting |
or intending to do such business, anything as to any such
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corporation, association, society, order, firm, company, |
partnership,
individual or aggregation of individuals provided |
in this Code or elsewhere in
the laws of this State to the |
contrary notwithstanding.
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(2) The word "company" as used in this Article includes all |
of the
corporations, associations, societies, orders, firms, |
companies,
partnerships, and individuals specified in |
subsections
(1), (4), and (5) of this Section and
agents, |
managing general agents, brokers, premium finance companies,
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insurance holding companies, and all other non-risk bearing |
entities or persons
engaged in any aspect of the business of |
insurance on behalf of an insurer
against which a receivership |
proceeding has been or is being filed under this
Article, |
including, but not limited to, entities or persons that provide
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management, administrative, accounting, data processing, |
marketing,
underwriting, claims handling, or any other similar |
services to that insurer,
whether or not those entities are |
licensed to engage in the business of
insurance in Illinois, if |
the
entity or person is an affiliate of that insurer.
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(3) The word "court" shall mean the court before which the
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conservation, rehabilitation, or liquidation proceeding of the |
company is
pending, or the judge presiding in such proceedings.
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(4) The word "affiliate" as used in this Article means a |
person that
directly, or indirectly through one or more |
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intermediaries, controls, is
controlled by, or is under common |
control with, the person specified.
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(5) The word "person" as used in this Article means an |
individual, an
aggregation
of individuals, a partnership, or a |
corporation.
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(6) The word "assets" as used in this Article includes all |
deposits and
funds of a special or trust nature.
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(7) The words "receivership proceedings" mean any |
conservation,
rehabilitation, liquidation, or ancillary |
receivership.
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(8) "Netting agreement", as used in this Article, means (a) |
a contract or agreement (including terms and conditions |
incorporated by reference therein), including a master |
agreement (which master agreement, together with all |
schedules, confirmations, definitions, and addenda thereto and |
transactions under any thereof, shall be treated as one netting |
agreement), that documents one or more transactions between the |
parties to the agreement for or involving one or more qualified |
financial contracts and that provides for the netting, |
liquidation, setoff, termination, acceleration, or close out |
under or in connection with one or more qualified financial |
contracts or present or future payment or delivery obligations |
or payment or delivery entitlements thereunder (including |
liquidation or close-out values relating to such obligations or |
entitlements) among the parties to the netting agreement; (b) |
any master agreement or bridge agreement for one or more master |
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agreements described in paragraph (a) of this subsection (8); |
or (c) any security agreement or arrangement or other credit |
enhancement or guarantee or reimbursement obligation related |
to any contract or agreement described in paragraph (a) or (b) |
of this subsection (8); provided that any contract or agreement |
described in paragraphs (a) or (b) of this subsection (8) |
relating to agreements or transactions that are not qualified |
financial contracts shall be deemed to be a netting agreement |
only with respect to those agreements or transactions that are |
qualified financial contracts. |
(9) "Qualified financial contract" means any commodity |
contract, forward contract, repurchase agreement, securities |
contract, swap agreement, or any similar agreement that the |
Director determines by regulation, resolution, or order to be a |
qualified financial contract for the purposes of this Act. |
(a) "Commodity contract" means: |
(1) a contract for the purchase or sale of a |
commodity for future delivery on, or subject to the |
rules of, a board of trade or contract market under the |
federal Commodity Exchange Act or a board of trade |
outside the United States; |
(2) an agreement that is subject to regulation |
under Section 19 of the federal Commodity Exchange Act |
and that is commonly known to the commodities trade as |
a margin account, margin contract, leverage account, |
or leverage contract; |
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(3) an agreement or transaction that is subject to |
regulation under Section 4c(b) of the federal |
Commodity Exchange Act and that is commonly known to |
the commodities trade as a commodity option; |
(4) any combination of the agreements or |
transactions referred to in this paragraph (a); or |
(5) any option to enter into an agreement or |
transaction referred to in this paragraph (a). |
(b) "Forward contract", "repurchase agreement", |
"securities contract", and "swap agreement" shall have the |
meanings set forth in the Federal Deposit Insurance Act, 12 |
U.S.C. § 1821(e)(8)(D), as amended from time to time. |
(Source: P.A. 92-140, eff. 7-24-01.)
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(215 ILCS 5/206.1 new) |
Sec. 206.1. Qualified financial contracts. |
(a) Notwithstanding any other provision of this Article, |
including any other provision of this Article permitting the |
modification of contracts, or other law of a state, no person |
shall be stayed or prohibited from exercising: |
(1) a contractual right to cause the termination, |
liquidation, acceleration, or close out of obligations |
under or in connection with any netting agreement or |
qualified financial contract with an insurer because of: |
(A) the insolvency, financial condition, or |
default of the insurer at any time, provided that the |
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right is enforceable under an applicable law other than |
this Code; or |
(B) the commencement of a formal delinquency |
proceeding under this Code; |
(2) any right under a pledge, security, collateral, |
reimbursement or guarantee agreement or arrangement, any |
other similar security agreement or arrangement, or other |
credit enhancement relating to one or more netting |
agreements or qualified financial contracts; |
(3) subject to any provision of Section 206 of this |
Article, any right to set off or net out any termination |
value, payment amount, or other transfer obligation |
arising under or in connection with one or more qualified |
financial contracts where the counterparty or its |
guarantor is organized under the laws of the United States |
or a state or a foreign jurisdiction approved by the |
Securities Valuation Office of the National Association of |
Insurance Commissioners as eligible for netting; or |
(4) if a counterparty to a master netting agreement or |
a qualified financial contract with an insurer subject to a |
proceeding under this Article terminates, liquidates, |
closes out or accelerates the agreement or contract, then |
damages shall be measured as of the date or dates of |
termination, liquidation, close out, or acceleration; the |
amount of a claim for damages shall be actual direct |
compensatory damages calculated in accordance with |
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subsection (f) of this Section. |
(b) Upon termination of a netting agreement or qualified |
financial contract, the net or settlement amount, if any, owed |
by a nondefaulting party to an insurer against which an |
application or petition has been filed under this Code shall be |
transferred to or on the order of the receiver for the insurer, |
even if the insurer is the defaulting party, notwithstanding |
any walkaway clause in the netting agreement or qualified |
financial contract. |
For the purposes of this subsection (b), the term "walkaway |
clause" means a provision in a netting agreement or a qualified |
financial contract that, after calculation of a value of a |
party's position or an amount due to or from one of the parties |
in accordance with its terms upon termination, liquidation, or |
acceleration of the netting agreement or qualified financial |
contract, either does not create a payment obligation of a |
party or extinguishes a payment obligation of a party in whole |
or in part solely because of the party's status as a |
nondefaulting party. Any limited 2-way payment or first method |
provision in a netting agreement or qualified financial |
contract with an insurer that has defaulted shall be deemed to |
be a full 2-way payment or second method provision as against |
the defaulting insurer. Any such property or amount shall, |
except to the extent that it is subject to one or more |
secondary liens or encumbrances or rights of netting or setoff, |
be a general asset of the insurer. |
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(c) In making any transfer of a netting agreement or |
qualified financial contract of an insurer subject to a |
proceeding under this Code, the receiver shall either: |
(1) transfer to one party (other than an insurer |
subject to a proceeding under this Article) all netting |
agreements and qualified financial contracts between a |
counterparty or any affiliate of the counterparty and the |
insurer that is the subject of the proceeding, including: |
(A) all rights and obligations of each party under |
each netting agreement and qualified financial |
contract; and |
(B) all property, including any guarantees or |
other credit enhancement, securing any claims of each |
party under each netting agreement and qualified |
financial contract; or |
(2) transfer none of the netting agreements, qualified |
financial contracts, rights, obligations, or property |
referred to in paragraph (1) of this subsection (c) (with |
respect to the counterparty and any affiliate of the |
counterparty). |
(d) If a receiver for an insurer makes a transfer of one or |
more netting agreements or qualified financial contracts, then |
the receiver shall use its best efforts to notify any person |
who is party to the netting agreements or qualified financial |
contracts of the transfer by 12:00 noon (the receiver's local |
time) on the business day following the transfer. For the |
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purposes of this subsection (d), "business day" means a day |
other than a Saturday, Sunday, or any day on which either the |
New York Stock Exchange or the Federal Reserve Bank of New York |
is closed. |
(e) Notwithstanding any other provision of this Article, a |
receiver may not avoid a transfer of money or other property |
arising under or in connection with a netting agreement or |
qualified financial contract (or any pledge, security, |
collateral, or guarantee agreement or any other similar |
security arrangement or credit support document relating to a |
netting agreement or qualified financial contract) that is made |
before the commencement of a formal delinquency proceeding |
under this Article. |
(f) The following provisions shall apply concerning |
disaffirmance and repudiation: |
(1) In exercising the rights of disaffirmance or |
repudiation of a receiver with respect to any netting |
agreement or qualified financial contract to which an |
insurer is a party, the receiver for the insurer shall |
either: |
(A) disaffirm or repudiate all netting agreements |
and qualified financial contracts between a |
counterparty or any affiliate of the counterparty and |
the insurer that is the subject of the proceeding; or |
(B) disaffirm or repudiate none of the netting |
agreements and qualified financial contracts referred |
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to in subparagraph (A) (with respect to the person or |
any affiliate of the person). |
(2) Notwithstanding any other provision of this |
Article, any claim of a counterparty against the estate |
arising from the receiver's disaffirmance or repudiation |
of a netting agreement or qualified financial contract that |
has not been previously affirmed in the liquidation or |
immediately preceding a conservation or rehabilitation |
case shall be determined and shall be allowed or disallowed |
as if the claim had arisen before the date of the filing of |
the petition for liquidation or, if a conservation or |
rehabilitation proceeding is converted to a liquidation |
proceeding, as if the claim had arisen before the date of |
the filing of the petition for conservation or |
rehabilitation. The amount of the claim shall be the actual |
direct compensatory damages determined as of the date of |
the disaffirmance or repudiation of the netting agreement |
or qualified financial contract. The term "actual direct |
compensatory damages" does not include punitive or |
exemplary damages, damages for lost profit or lost |
opportunity, or damages for pain and suffering, but does |
include normal and reasonable costs of cover or other |
reasonable measures of damages utilized in the |
derivatives, securities, or other market for the contract |
and agreement claims. |
(g) The term "contractual right", as used in this Section, |
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includes any right set forth in a rule or bylaw of a |
derivatives clearing organization, as defined in the Commodity |
Exchange Act; a multilateral clearing organization, as defined |
in the Federal Deposit Insurance Corporation Improvement Act of |
1991; a national securities exchange; a national securities |
association; a securities clearing agency; a contract market |
designated under the Commodity Exchange Act; a derivatives |
transaction execution facility registered under the Commodity |
Exchange Act; or a board of trade, as defined in the Commodity |
Exchange Act or in a resolution of the governing board thereof |
and any right, whether or not evidenced in writing, arising |
under statutory or common law or under law merchant or by |
reason of normal business practice. |
(h) The provisions of this Section shall not apply to |
persons who are affiliates of the insurer that is the subject |
of the proceeding. |
(i) All rights of counterparties under this Article shall |
apply to netting agreements and qualified financial contracts |
entered into on behalf of the general account or separate |
accounts if the assets of each separate account are available |
only to counterparties to netting agreements and qualified |
financial contracts entered into on behalf of that separate |
account.
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(215 ILCS 5/209) (from Ch. 73, par. 821)
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Sec. 209. Proof and allowance of claims.
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(1) The following provisions shall apply concerning proof |
and allowance of claims: |
(a) Proof of claim shall consist of a statement signed |
by the claimant or on behalf of the claimant that includes |
all of the following that are applicable: |
(i) the particulars of the claim including the |
consideration given for it; |
(ii) the identity and amount of the security on the |
claim; |
(iii) the payments made on the debt, if any; |
(iv) that the sum claimed is justly owing and that |
there is no setoff, counterclaim, or defense to the |
claim; |
(v) any right of priority of payment or other |
specific right asserted by the claimant; |
(vi) the name and address of the claimant and the |
attorney, if any, who represents the claimant; and |
(vii) the claimant's social security or federal |
employer identification number. |
(b) The Director may require that a prescribed form be |
used and may require that other information and documents |
be included. |
(c) At any time the Director may require the claimant |
to present information or evidence supplementary to that |
required under paragraph (a) and may take testimony under |
oath, require production of affidavits or depositions, or |
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otherwise obtain additional information or evidence. |
(2) (1) A proof of claim shall consist of a written |
statement signed
under oath setting forth the claim, the |
consideration
for it, whether the claim is secured
and, if
so, |
how, what payments have been made on the
claim, if any, and |
that
the sum claimed is justly owing from the company. Whenever
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a claim is based upon a document, the document, unless
lost or |
destroyed, shall be filed with the proof of claim. If the |
document is
lost or destroyed, a statement of that fact and of
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the
circumstances of the loss or destruction shall be included |
in
the proof of claim.
A claim may be allowed even if |
contingent or unliquidated as of the date
fixed by the court
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pursuant to subsection (a) of Section 194 if it is filed in |
accordance with
this subsection. Except as otherwise provided |
in subsection (7), a proof of
claim required under this Section |
must identify a known loss or occurrence.
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(2) At any time, the Director may require the claimant to |
present
information or evidence supplementary to that required |
under subsection (l)
and
may take testimony under oath, require |
production of affidavits or depositions,
or otherwise obtain |
additional information or evidence.
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(3) Upon the liquidation, rehabilitation, or conservation |
of
any
company which has issued policies insuring the lives of |
persons, the
Director shall, within a reasonable time, after |
the last day set for the
filing of claims, make a list of the |
persons who have not filed proofs of
claim with him and whose |
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rights have not been reinsured, to whom it appears
from the |
books of the company, there are owing amounts on such policies |
and
he shall set opposite the name of each person such amount |
so owing to such
person. The Director shall incur no personal |
liability by reason of any
mistake in such list. Each person |
whose name shall appear upon said list
shall be deemed to have |
duly filed prior to the last day set for filing of
claims a |
proof of claim for the amount set opposite his name on said |
list.
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(4)(a) When a Liquidation, Rehabilitation, or
Conservation |
Order has been entered in a proceeding against an insurer under
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this Code, any insured under an insurance policy shall have
the |
right to file a contingent claim. The Court at the time of the |
entry of
the Order of Liquidation, Rehabilitation or |
Conservation shall fix the final
date for the liquidation of |
insureds' contingent claims, but
in no event
shall said date be |
more than 3 years after the last day fixed for the filing of
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claims, provided, such date may be extended by the Court on |
petition of the
Director should the Director determine that |
such extension will not delay
distribution of assets under |
Section 210. Such a contingent claim
shall be allowed if such |
claim is liquidated and the insured
claimant presents evidence |
of payment of such claim to the Director on or
before the last |
day fixed by the Court.
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(b) When an insured has been unable to liquidate its claim |
under paragraph
(a) of this subsection (4), the insured may |
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have its claim allowed by
estimation if (i) it may be |
reasonably inferred from the proof presented upon
the claim |
that a claim exists under the policy; (ii) the insured has |
furnished
suitable proof, unless the court for good cause shown |
shall otherwise direct,
that no further valid claims against |
the insurer arising out of the cause of
action other than those |
already presented can be made, and (iii) the total
liability of |
the insurer to all claimants arising out of the same act shall |
be
no greater than its total liability would be were it not in |
liquidation,
rehabilitation, or conservation.
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(5) The obligation of the insurer, if any, to defend or |
continue the
defense
of any claim or suit under a liability |
insurance policy shall terminate on
the entry of the Order of |
Liquidation, Rehabilitation or Conservation,
except during the |
appeal of an Order of Liquidation as provided by Section
190.1 |
or, unless upon the petition of the Director, the court directs
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otherwise. Insureds may include in contingent claims |
reasonable attorneys
fees for services rendered subsequent to |
the date of Liquidation,
Rehabilitation or Conservation in |
defense of claims or suits covered by the
insured's policy |
provided such attorneys fees have actually been paid by the
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assured and evidence of payment presented in the manner |
required for insured's
contingent claims.
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(6) When a liquidation, rehabilitation, or
conservation |
order has been
entered in a proceeding against
an insurer under |
this Code, any person who has a cause of action against an
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insured of the insurer under an insurance
policy issued by the |
insurer shall have the right to file a
claim in the proceeding, |
regardless of the fact that the claim
may be contingent, and |
the claim may be allowed by estimation (a) if it may be
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reasonably, inferred from proof presented upon the claim
that |
the claimant would be able to obtain a judgment upon
the cause |
of action against the insured; and (b) if
the person has |
furnished
suitable proof, unless the court for
good cause shown |
shall otherwise direct, that no further valid claims
against |
the insurer arising out of the cause of
action other than those
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already presented can be made, and (c) the total liability of
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the
insurer to all claimants arising out of the same act shall
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be no greater than its total liability would be were it not in |
liquidation,
rehabilitation, or
conservation.
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(7) Contingent or unliquidated general creditors' and |
ceding insurers'
claims that are not made absolute and |
liquidated by the last day fixed by the
court pursuant to |
subsection (4) may be determined and allowed by estimation.
Any |
such estimate shall be based upon an actuarial evaluation made
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with reasonable actuarial certainty or upon another accepted |
method of valuing
claims with reasonable certainty and, with |
respect to ceding insurers' claims,
may include an estimate of |
incurred but not reported losses.
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(7.5) (a) The estimation and allowance of the loss |
development on a known loss or occurrence shall trigger a |
reinsurer's obligation to pay pursuant to its reinsurance |
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contract with the insolvent company, provided that the |
allowance is made in accordance with paragraph (b) of |
subsection (4) or subsection (6). The Director shall have the |
authority to exercise all available remedies on behalf of the |
insolvent company to marshal these reinsurance recoverables. |
(b) That portion of any estimated and allowed contingent |
claim that is attributable to claims incurred but not reported |
to the insolvent company's reinsured shall not be billable to |
the insolvent company's reinsurers, except to the extent that |
(A) such claims develop into known losses or occurrences and |
become billable under paragraph (a) of this subsection or (B) |
the reinsurance contract specifically provides for the payment |
of such losses or reserves. |
(c) Notwithstanding any other provision of this Code, the |
liquidator may negotiate a voluntary commutation and release of |
all obligations arising from reinsurance contracts or other |
agreements.
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(8) No judgment against such an insured or an
insurer taken |
after the date of the entry of the liquidation,
rehabilitation, |
or conservation order shall be considered in the
proceedings
as |
evidence of liability, or of the amount of damages, and no |
judgment
against an insured or an insurer taken by default, or |
by collusion prior to
the entry of the liquidation order shall |
be considered as conclusive
evidence in the proceeding either |
of the liability of such insured to such
person upon such cause |
of action or of the amount of damages to which such
person is |
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therein entitled.
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(9) The value of securities held by secured creditors shall |
be
determined by converting the same into money according to |
the terms of the
agreement pursuant to which such securities |
were delivered to such
creditors, or by such creditors and the |
Director by agreement, or by the
court, and the amount of such |
value shall be credited upon the claims of
such secured |
creditors and their claims allowed only for the balance.
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(10) Claims of creditors or policyholders who have received
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preferences
voidable under Section 204 or to whom conveyances |
or transfers,
assignments or incumbrances have been made or |
given which are void under
Section 204, shall not be allowed |
unless such creditors or policyholders
shall surrender such |
preferences, conveyances, transfers, assignments or
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incumbrances.
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(11)(a) When the Director denies a claim or allows a claim |
for less than
the amount requested by the claimant, written |
notice of the determination and
of the right to object shall be |
given promptly to the claimant or the
claimant's representative |
by first class mail at the address shown on the
proof of claim. |
Within 60 days from the mailing of the notice, the claimant
may
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file his written objections with the Director. If no such |
filing is made on a
timely basis, the claimant may not further |
object to the determination.
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(b) Whenever objections are filed with the Director and he |
does not alter
his determination as a result of the objection |
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and the claimant continues to
object, the Director shall |
petition the court for a hearing as soon as
practicable and |
give notice of the hearing by first class mail to the claimant
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or his representative and to any other persons known by the |
Director to be
directly affected, not less than 10 days before |
the date of the hearing.
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(12) The Director shall review all claims duly filed in the |
liquidation,
rehabilitation, or conservation proceeding, |
unless otherwise directed by the
court, and shall make such |
further investigation as he considers necessary.
The Director |
may compound, compromise, or in any other manner negotiate the
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amount for which claims will be recommended to the court. |
Unresolved disputes
shall be determined under subsection (11).
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(13)(a) The Director shall present to the court reports of |
claims reviewed
under subsection (12) with his recommendations |
as to each claim.
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(b) The court may approve or disapprove any recommendations |
contained in the
reports of claims filed by the Director, |
except that the Director's agreements
with claimants shall be |
accepted as final by the court on claims settled for
$10,000 or |
less.
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(14) The changes made in this Section by this amendatory |
Act of 1993
apply to
all
liquidation, rehabilitation, or
|
conservation proceedings that are pending on the effective date |
of this
amendatory Act of 1993 and to all future liquidation, |
rehabilitation, or
conservation proceedings,
except that the |
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changes made to the provisions of
this Section by this |
amendatory Act of 1993 shall not apply to any company
ordered |
into liquidation on or before January 1, 1982.
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(15) The changes made in this Section by this amendatory |
Act of the 93rd General Assembly do not apply to any company |
ordered into liquidation on or before January 1, 2004.
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(Source: P.A. 93-1083, eff. 2-7-05.)
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(215 ILCS 5/531.03) (from Ch. 73, par. 1065.80-3)
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Sec. 531.03. Coverage and limitations.
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(1) This Article shall provide
coverage for the policies |
and contracts specified in paragraph (2) of this
Section:
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(a) to persons who, regardless of where they reside |
(except for
non-resident certificate holders under group |
policies or contracts), are the
beneficiaries, assignees |
or payees of the persons covered under subparagraph
(1)(b), |
and
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(b) to persons who are owners of or certificate holders |
under the policies or contracts (other than unallocated |
annuity contracts and structured settlement annuities) and |
in each case who: |
(i) are residents; or |
(ii) are not residents, but only under all of the |
following conditions: |
(A) the insurer that issued the policies or |
contracts is domiciled in this State; |
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(B) the states in which the persons reside have |
associations similar to the Association created by |
this Article; |
(C) the persons are not eligible for coverage |
by an association in any other state due to the |
fact that the insurer was not licensed in that |
state at the time specified in that state's |
guaranty association law. |
(c) For unallocated annuity contracts specified in |
subsection (2), paragraphs (a) and (b) of this subsection |
(1) shall not apply and this Article shall (except as |
provided in paragraphs (e) and (f) of this subsection) |
provide coverage to: |
(i) persons who are the owners of the unallocated |
annuity contracts if the contracts are issued to or in |
connection with a specific benefit plan whose plan |
sponsor has its principal place of business in this |
State; and |
(ii) persons who are owners of unallocated annuity |
contracts issued to or in connection with government |
lotteries if the owners are residents. |
(d) For structured settlement annuities specified in |
subsection (2), paragraphs (a) and (b) of this subsection |
(1) shall not apply and this Article shall (except as |
provided in paragraphs (e) and (f) of this subsection) |
provide coverage to a person who is a payee under a |
|
structured settlement annuity (or beneficiary of a payee if |
the payee is deceased), if the payee: |
(i) is a resident, regardless of where the contract |
owner resides; or |
(ii) is not a resident, but only under both of the |
following conditions: |
(A) with regard to residency: |
(I) the contract owner of the structured |
settlement annuity is a resident; or |
(II) the contract owner of the structured |
settlement annuity is not a resident but the |
insurer that issued the structured settlement |
annuity is domiciled in this State and the |
state in which the contract owner resides has |
an association similar to the Association |
created by this Article; and |
(B) neither the payee or beneficiary nor the |
contract owner is eligible for coverage by the |
association of the state in which the payee or |
contract owner resides. |
(e) This Article shall not provide coverage to: |
(i) a person who is a payee or beneficiary of a |
contract owner resident of this State if the payee or |
beneficiary is afforded any coverage by the |
association of another state; or |
(ii) a person covered under paragraph (c) of this |
|
subsection (1), if any coverage is provided by the |
association of another state to that person. |
(f) This Article is intended to provide coverage to a |
person who is a resident of this State and, in special |
circumstances, to a nonresident. In order to avoid |
duplicate coverage, if a person who would otherwise receive |
coverage under this Article is provided coverage under the |
laws of any other state, then the person shall not be |
provided coverage under this Article. In determining the |
application of the provisions of this paragraph in |
situations where a person could be covered by the |
association of more than one state, whether as an owner, |
payee, beneficiary, or assignee, this Article shall be |
construed in conjunction with other state laws to result in |
coverage by only one association. to persons who are owners |
of or certificate holders under such
policies or contracts; |
or, in the case of unallocated annuity contracts, to
the |
persons who are the contract holders, and who
|
(i) are residents of this State, or
|
(ii) are not residents, but only under all of the |
following conditions:
|
(A) the insurers which issued such policies or |
contracts are domiciled
in this State;
|
(B) such insurers never held a license or |
certificate of authority in
the states in which |
such persons reside;
|
|
(C) such states have associations similar to |
the association created
by this Act; and
|
(D) such persons are not eligible for coverage |
by such associations.
|
(2)(a) This Article shall provide coverage to the persons
|
specified in paragraph (l) of this Section for direct, (i)
|
nongroup life, health, annuity and
supplemental policies, or |
contracts, (ii) for
certificates under direct group policies or |
contracts, (iii) for unallocated
annuity contracts and (iv) for |
contracts to furnish
health care services and subscription |
certificates for medical or health
care services issued by |
persons licensed to transact insurance business
in this State |
under the Illinois Insurance Code.
Annuity contracts and |
certificates under group annuity contracts include
but are not |
limited to guaranteed investment contracts, deposit
|
administration contracts, unallocated funding agreements, |
allocated funding
agreements, structured settlement |
agreements, lottery contracts
and any immediate or deferred |
annuity contracts.
|
(b) This Article shall not provide coverage for:
|
(i) that portion of a policy or contract not guaranteed |
by the insurer, or under which the risk is borne by the |
policy or contract owner or part of such policies or |
contracts under which the
risk is borne by the |
policyholder; provided however, that nothing in this
|
subparagraph (i) shall make this Article inapplicable
to |
|
assessment life and
accident and health insurance policies |
or contracts ; or
|
(ii) any such policy or contract or part thereof |
assumed by the impaired
or insolvent insurer under a |
contract of reinsurance, other than reinsurance
for which |
assumption certificates have been issued; or
|
(iii) any portion of a policy or contract to the extent |
that the rate of interest on which it is based or the |
interest rate, crediting rate, or similar factor is |
determined by use of an index or other external reference |
stated in the policy or contract employed in calculating |
returns or changes in value: any portion of a policy or |
contract to the extent such portion
represents an accrued |
value that the rate of interest on which it is accrued
|
(A) averaged over the period of 4 years prior to |
the date on which the member insurer becomes an |
impaired or insolvent insurer under this Article, |
whichever is earlier, exceeds the rate of interest |
determined by subtracting 2 percentage points from |
Moody's Corporate Bond Yield Average averaged for that |
same 4-year period or for such lesser period if the |
policy or contract was issued less than 4 years before |
the member insurer becomes an impaired or insolvent |
insurer under this Article, whichever is earlier |
averaged over the period of four years prior to the |
date on which
the Association becomes obligated with |
|
respect to such policy or contract,
exceeds a rate of |
interest determined by subtracting two percentage |
points
from Moody's Corporate Bond Yield Average |
averaged for that same four year
period or for such |
lesser period if the policy or contract was issued less
|
than four years before the Association became |
obligated ; and
|
(B) on and after the date on which the member |
insurer becomes an impaired or insolvent insurer under |
this Article, whichever is earlier, exceeds the rate of |
interest determined by subtracting 3 percentage points |
from Moody's Corporate Bond Yield Average as most |
recently available on and after the date on which the |
Association becomes obligated
with respect to such |
policy or contract, exceeds the rate of interest
|
determined by subtracting three percentage points from |
Moody's Corporate
Bond Yield Average as most recently |
available ; or
|
(iv) any unallocated annuity contract issued to or in |
connection with a benefit plan protected under the federal |
Pension Benefit Guaranty Corporation, regardless of |
whether the federal Pension Benefit Guaranty Corporation |
has yet become liable to make any payments with respect to |
the benefit plan any unallocated annuity contract issued to |
an employee benefit plan
protected under the federal |
Pension Benefit Guaranty Corporation ; or
|
|
(v) any portion of any unallocated annuity contract |
which is not issued
to or in connection with a specific |
employee, union or association of
natural persons benefit |
plan or a government lottery; or
|
(vi) an obligation that does not arise under the |
express written terms of the policy or contract issued by |
the insurer to the contract owner or policy owner, |
including without limitation: |
(A) a claim based on marketing materials; |
(B) a claim based on side letters, riders, or other |
documents that were issued by the insurer without |
meeting applicable policy form filing or approval |
requirements; |
(C) a misrepresentation of or regarding policy |
benefits; |
(D) an extra-contractual claim; or |
(E) a claim for penalties or consequential or |
incidental damages; any burial society organized under |
Article XIX of this Act, any
fraternal benefit society |
organized under Article XVII of this Act, any
mutual |
benefit association organized under Article XVIII of |
this
Act, and any foreign fraternal benefit society |
licensed under Article
VI of this Act; or
|
(vii) any health maintenance organization established
|
pursuant to the Health
Maintenance Organization Act
|
including any health maintenance organization business of |
|
a member insurer; or
|
(viii) any health services plan corporation |
established pursuant to the
Voluntary Health Services |
Plans Act;
or
|
(ix) (blank); or
|
(x) any dental service plan corporation established
|
pursuant to the Dental
Service Plan Act; or
|
(vii) (xi) any stop-loss insurance, as defined in |
clause (b) of Class 1 or
clause (a) of Class 2 of Section |
4, and further defined in subsection (d) of
Section 352; or
|
(viii) any policy or contract providing any hospital, |
medical, prescription drug, or other health care benefits |
pursuant to Part C or Part D of Subchapter XVIII, Chapter 7 |
of Title 42 of the United States Code (commonly known as |
Medicare Part C & D) or any regulations issued pursuant |
thereto; |
(ix) any portion of a policy or contract to the extent |
that the assessments required by Section 531.09 of this |
Code with respect to the policy or contract are preempted |
or otherwise not permitted by federal or State law; |
(x) any portion of a policy or contract issued to a |
plan or program of an employer, association, or other |
person to provide life, health, or annuity benefits to its |
employees, members, or others to the extent that the plan |
or program is self-funded or uninsured, including, but not |
limited to, benefits payable by an employer, association, |
|
or other person under: |
(A) a multiple employer welfare arrangement as |
defined in 29 U.S.C. Section 1144; |
(B) a minimum premium group insurance plan; |
(C) a stop-loss group insurance plan; or |
(D) an administrative services only contract; |
(xi) any portion of a policy or contract to the extent |
that it provides for: |
(A) dividends or experience rating credits; |
(B) voting rights; or |
(C) payment of any fees or allowances to any |
person, including the policy or contract owner, in |
connection with the service to or administration of the |
policy or contract; |
(xii) any policy or contract issued in this State by a |
member insurer at a time when it was not licensed or did |
not have a certificate of authority to issue the policy or |
contract in this State; |
(xiii) any contractual agreement that establishes the |
member insurer's obligations to provide a book value |
accounting guaranty for defined contribution benefit plan |
participants by reference to a portfolio of assets that is |
owned by the benefit plan or its trustee, which in each |
case is not an affiliate of the member insurer; |
(xiv) any portion of a policy or contract to the extent |
that it provides for interest or other changes in value to |
|
be determined by the use of an index or other external |
reference stated in the policy or contract, but which have |
not been credited to the policy or contract, or as to which |
the policy or contract owner's rights are subject to |
forfeiture, as of the date the member insurer becomes an |
impaired or insolvent insurer under this Code, whichever is |
earlier. If a policy's or contract's interest or changes in |
value are credited less frequently than annually, then for |
purposes of determining the values that have been credited |
and are not subject to forfeiture under this Section, the |
interest or change in value determined by using the |
procedures defined in the policy or contract will be |
credited as if the contractual date of crediting interest |
or changing values was the date of impairment or |
insolvency, whichever is earlier, and will not be subject |
to forfeiture; or
|
(xv) (xii) that portion or part of a variable life |
insurance or
variable
annuity
contract not guaranteed by an |
insurer.
|
(3) The benefits for which the Association may become |
liable shall in
no event exceed the lesser of:
|
(a) the contractual obligations for which the insurer |
is liable or would
have been liable if it were not an |
impaired or insolvent insurer, or
|
(b)(i) with respect to any one life, regardless of the |
number of policies
or
contracts:
|
|
(A) $300,000 in life insurance death benefits, but |
not more than
$100,000 in net cash surrender and net |
cash withdrawal values for life
insurance;
|
(B) in health insurance benefits: |
(I) $100,000 for coverages not defined as |
disability insurance or basic hospital, medical, |
and surgical insurance or major medical insurance |
or long-term care insurance, including any net |
cash surrender and net cash withdrawal values; |
(II) $300,000 for disability insurance and |
$300,000 for long-term care insurance as defined |
in Section 351A-1 of this Code; and |
(III) $500,000 for basic hospital medical and |
surgical insurance or major medical insurance |
$300,000 in health insurance benefits, including |
any net cash
surrender and net cash withdrawal |
values ;
|
(C) $250,000 in the present value of annuity |
benefits, including net cash surrender and net cash |
withdrawal values; |
(ii) with respect to each individual participating in a |
governmental retirement benefit plan established under |
Sections 401, 403(b), or 457 of the U.S. Internal Revenue |
Code covered by an unallocated annuity contract or the |
beneficiaries of each such individual if deceased, in the |
aggregate, $250,000 in present value annuity benefits, |
|
including net cash surrender and net cash withdrawal |
values; |
(iii) with respect to each payee of a structured |
settlement annuity or beneficiary or beneficiaries of the |
payee if deceased, $250,000 in present value annuity |
benefits, in the aggregate, including net cash surrender |
and net cash withdrawal values, if any; or |
(iv) with respect to either (1) one contract owner |
provided coverage under subparagraph (ii) of paragraph (c) |
of subsection (1) of this Section or (2) one plan sponsor |
whose plans own directly or in trust one or more |
unallocated annuity contracts not included in subparagraph |
(ii) of paragraph (b) of this subsection, $5,000,000 in |
benefits, irrespective of the number of contracts with |
respect to the contract owner or plan sponsor. However, in |
the case where one or more unallocated annuity contracts |
are covered contracts under this Article and are owned by a |
trust or other entity for the benefit of 2 or more plan |
sponsors, coverage shall be afforded by the Association if |
the largest interest in the trust or entity owning the |
contract or contracts is held by a plan sponsor whose |
principal place of business is in this State. In no event |
shall the Association be obligated to cover more than |
$5,000,000 in benefits with respect to all these |
unallocated contracts. |
In no event shall the Association be obligated to cover |
|
more than (1) an aggregate of $300,000 in benefits with respect |
to any one life under subparagraphs (i), (ii), and (iii) of |
this paragraph (b) except with respect to benefits for basic |
hospital, medical, and surgical insurance and major medical |
insurance under item (B) of subparagraph (i) of this paragraph |
(b), in which case the aggregate liability of the Association |
shall not exceed $500,000 with respect to any one individual or |
(2) with respect to one owner of multiple nongroup policies of |
life insurance, whether the policy owner is an individual, |
firm, corporation, or other person and whether the persons |
insured are officers, managers, employees, or other persons, |
$5,000,000 in benefits, regardless of the number of policies |
and contracts held by the owner. |
The limitations set forth in this subsection are |
limitations on the benefits for which the Association is |
obligated before taking into account either its subrogation and |
assignment rights or the extent to which those benefits could |
be provided out of the assets of the impaired or insolvent |
insurer attributable to covered policies. The costs of the |
Association's obligations under this Article may be met by the |
use of assets attributable to covered policies or reimbursed to |
the Association pursuant to its subrogation and assignment |
rights. |
$100,000 in the present value of annuity benefits, |
including net
cash surrender and net cash withdrawal |
values;
|
|
(ii) with respect to each individual participating in a |
governmental
retirement plan established under Section |
401, 403(b) or 457 of the U.S.
Internal Revenue Code |
covered by an unallocated annuity contract or the
|
beneficiaries of each such individual if deceased, in the |
aggregate,
$100,000 in present value annuity benefits, |
including net cash surrender
and net cash withdrawal |
values; provided, however, that in no event shall
the |
Association be liable to expend more than $300,000 in the |
aggregate
with respect to any one individual under |
subparagraph (1) and this
subparagraph;
|
(iii) with respect to any one contract holder covered |
by any unallocated
annuity contract not included in |
subparagraph (3)(b)(ii) of this Section
above, $5,000,000
|
in benefits, irrespective of the number of such contracts |
held by that contract
holder.
|
(4) In performing its obligations to provide coverage under |
Section 531.08 of this Code, the Association shall not be |
required to guarantee, assume, reinsure, or perform or cause to |
be guaranteed, assumed, reinsured, or performed the |
contractual obligations of the insolvent or impaired insurer |
under a covered policy or contract that do not materially |
affect the economic values or economic benefits of the covered |
policy or contract. |
(Source: P.A. 90-177, eff. 7-23-97; 91-357, eff. 7-29-99.)
|
|
(215 ILCS 5/531.04) (from Ch. 73, par. 1065.80-4)
|
Sec. 531.04.
Construction. ) This Article shall be is to be |
liberally construed to
effect the purpose under Section 531.02 |
which constitutes an aid and guide to
interpretation .
|
(Source: P.A. 81-899.)
|
(215 ILCS 5/531.05) (from Ch. 73, par. 1065.80-5)
|
Sec. 531.05. Definitions. As used in this Act:
|
(1) "Account" means either of the 3 accounts created under |
Section
531.06.
|
(2) "Association" means the Illinois Life and Health |
Insurance
Guaranty Association created under Section 531.06.
|
"Authorized assessment" or the term "authorized" when used |
in the context of assessments means a resolution by the Board |
of Directors has been passed whereby an assessment shall be |
called immediately or in the future from member insurers for a |
specified amount. An assessment is authorized when the |
resolution is passed. |
"Benefit plan" means a specific employee, union, or |
association of natural persons benefit plan. |
"Called assessment" or the term "called" when used in the |
context of assessments means that a notice has been issued by |
the Association to member insurers requiring that an authorized |
assessment be paid within the time frame set forth within the |
notice. An authorized assessment becomes a called assessment |
when notice is mailed by the Association to member insurers. |
|
(3) "Director" means the Director of Insurance of this |
State.
|
(4) "Contractual obligation" means any obligation under a |
policy or
contract or certificate under a group policy or |
contract, or portion
thereof for which coverage is provided |
under Section 531.03.
|
(5) "Covered person" means any person who is entitled to |
the
protection of the Association as described in Section |
531.02.
|
(6) "Covered policy" means any policy or contract within |
the scope
of this Article under Section 531.03.
|
"Extra-contractual claims" shall include claims relating |
to bad faith in the payment of claims, punitive or exemplary |
damages, or attorneys' fees and costs. |
"Impaired insurer" means (A) a member insurer which, after |
the effective date of this amendatory Act of the 96th General |
Assembly, is not an insolvent insurer, and is placed under an |
order of rehabilitation or conservation by a court of competent |
jurisdiction or (B) a member insurer deemed by the Director |
after the effective date of this amendatory Act of the 96th |
General Assembly to be potentially unable to fulfill its |
contractual obligations and not an insolvent insurer. (7) |
"Impaired insurer" means a member insurer deemed by the |
Director
after the effective date of this Article to be |
potentially unable to
fulfill its contractual obligations and |
not an insolvent insurer.
|
|
"Insolvent insurer" means a member insurer that, after the |
effective date of this amendatory Act of the 96th General |
Assembly, is placed under a final order of liquidation by a |
court of competent jurisdiction with a finding of insolvency. |
(8) "Insolvent insurer" means (a) a member insurer
either at |
the time the policy was issued or when the insured event
|
occurred, or any company which has acquired such direct policy |
obligations
through purchase, merger, consolidation, |
reinsurance or otherwise, whether
or not such acquiring company |
held a certificate of authority to transact
insurance in this |
State at the time such policy was issued or when the
insured |
event occurred; and (b) becomes insolvent and is placed under a
|
final order of liquidation, rehabilitation or conservation by a |
court of
competent jurisdiction.
|
"Member insurer" means an insurer licensed or holding a |
certificate of authority to transact in this State any kind of |
insurance for which coverage is provided under Section 531.03 |
of this Code and includes an insurer whose license or |
certificate of authority in this State may have been suspended, |
revoked, not renewed, or voluntarily withdrawn or whose |
certificate of authority may have been suspended pursuant to |
Section 119 of this Code, but does not include: |
(1) a hospital or medical service organization, |
whether profit or nonprofit; |
(2) a health maintenance organization; |
(3) any burial society organized under Article XIX of |
|
this Code, any fraternal benefit society organized under |
Article XVII of this Code, any mutual benefit association |
organized under Article XVIII of this Code, and any foreign |
fraternal benefit society licensed under Article VI of this |
Code or
a fraternal benefit society; |
(4) a mandatory State pooling plan; |
(5) a mutual assessment company or other person that |
operates on an assessment basis; |
(6) an insurance exchange; |
(7) an organization that is permitted to issue |
charitable gift annuities pursuant to Section 121-2.10 of |
this Code; |
(8) any health services plan corporation established |
pursuant to the Voluntary Health Services Plans Act; |
(9) any dental service plan corporation established |
pursuant to the Dental Service Plan Act; or |
(10) an entity similar to any of the above. (9) "Member |
insurer" means any person licensed or who holds a |
certificate
of authority to transact in this
State any kind |
of insurance business to which this Article applies under
|
Section 531.03. For purposes of this Article "member |
insurer" includes
any person whose certificate of |
authority may have been suspended pursuant
to Section 119.
|
(10) "Moody's Corporate Bond Yield Average" means the |
Monthly Average
Corporates as published by Moody's Investors |
Service, Inc., or any successor
thereto. |
|
"Owner" of a policy or contract and "policy owner" and |
"contract owner" mean the person who is identified as the legal |
owner under the terms of the policy or contract or who is |
otherwise vested with legal title to the policy or contract |
through a valid assignment completed in accordance with the |
terms of the policy or contract and properly recorded as the |
owner on the books of the insurer. The terms owner, contract |
owner, and policy owner do not include persons with a mere |
beneficial interest in a policy or contract. |
"Person" means an individual, corporation, limited |
liability company, partnership, association, governmental body |
or entity, or voluntary organization. |
"Plan sponsor" means: |
(1) the employer in the case of a benefit plan |
established or maintained by a single employer; |
(2) the employee organization in the case of a benefit |
plan established or maintained by an employee |
organization; or |
(3) in a case of a benefit plan established or |
maintained by 2 or more employers or jointly by one or more |
employers and one or more employee organizations, the |
association, committee, joint board of trustees, or other |
similar group of representatives of the parties who |
establish or maintain the benefit plan. |
"Premiums" mean amounts or considerations, by whatever |
name called, received on covered policies or contracts less |
|
returned premiums, considerations, and deposits and less |
dividends and experience credits. |
"Premiums" does not include: |
(A) amounts or considerations received for policies or |
contracts or for the portions of policies or contracts for |
which coverage is not provided under Section 531.03 of this |
Code except that assessable premium shall not be reduced on |
account of the provisions of subparagraph (iii) of |
paragraph (b) of subsection (a) of Section 531.03 of this |
Code relating to interest limitations and the provisions of |
paragraph (b) of subsection (3) of Section 531.03 relating |
to limitations with respect to one individual, one |
participant, and one contract owner; |
(B) premiums in excess of $5,000,000 on an unallocated |
annuity contract not issued under a governmental |
retirement benefit plan (or its trustee) established under |
Section 401, 403(b) or 457 of the United States Internal |
Revenue Code; or |
(C) with respect to multiple nongroup policies of life |
insurance owned by one owner, whether the policy owner is |
an individual, firm, corporation, or other person, and |
whether the persons insured are officers, managers, |
employees, or other persons, premiums in excess of |
$5,000,000 with respect to these policies or contracts, |
regardless of the number of policies or contracts held by |
the owner. (11) "Premiums" means direct gross insurance |
|
premiums or
subscriptions and annuity
considerations |
received on covered policies or contracts, less return |
premiums
and
considerations thereon and dividends paid or |
credited to policyholders
on such direct business. |
"Premiums" do not include premiums and
considerations on |
contracts between insurers and reinsurers.
"Premiums" do |
not include any amounts received for any policies or
|
contracts or for the portions of any policies or contracts |
for which
coverage is not provided under paragraph (2) of |
Section 531.03 except that
assessable premium shall not be |
reduced on account of subparagraph
(2)(b)(iii) of Section |
531.03 relating to interest limitations and
subparagraph |
(3)(b) of Section 531.03 relating to limitations with |
respect
to any one individual, any one participant and any |
one contractholder;
provided that "premiums" shall not |
include any premiums in excess of five
million dollars on |
any unallocated annuity contract not issued under a
|
governmental retirement plan established under Sections |
401, 403(b) or 457
of the United States Internal Revenue |
Code.
|
(12) "Person" means any individual, corporation, |
partnership,
association or voluntary organization.
|
"Principal place of business" of a plan sponsor or a person |
other than a natural person means the single state in which the |
natural persons who establish policy for the direction, |
control, and coordination of the operations of the entity as a |
|
whole primarily exercise that function, determined by the |
Association in its reasonable judgment by considering the |
following factors: |
(A) the state in which the primary executive and |
administrative headquarters of the entity is located; |
(B) the state in which the principal office of the |
chief executive officer of the entity is located; |
(C) the state in which the board of directors (or |
similar governing person or persons) of the entity conducts |
the majority of its meetings; |
(D) the state in which the executive or management |
committee of the board of directors (or similar governing |
person or persons) of the entity conducts the majority of |
its meetings; |
(E) the state from which the management of the overall |
operations of the entity is directed; and |
(F) in the case of a benefit plan sponsored by |
affiliated companies comprising a consolidated |
corporation, the state in which the holding company or |
controlling affiliate has its principal place of business |
as determined using the above factors. However, in the case |
of a plan sponsor, if more than 50% of the participants in |
the benefit plan are employed in a single state, that state |
shall be deemed to be the principal place of business of |
the plan sponsor. |
The principal place of business of a plan sponsor of a |
|
benefit plan described in this Section shall be deemed to be |
the principal place of business of the association, committee, |
joint board of trustees, or other similar group of |
representatives of the parties who establish or maintain the |
benefit plan that, in lieu of a specific or clear designation |
of a principal place of business, shall be deemed to be the |
principal place of business of the employer or employee |
organization that has the largest investment in the benefit |
plan in question. |
"Receivership court" means the court in the insolvent or |
impaired insurer's state having jurisdiction over the |
conservation, rehabilitation, or liquidation of the insurer. |
"Resident" means a person to whom a contractual obligation |
is owed and who resides in this State on the date of entry of a |
court order that determines a member insurer to be an impaired |
insurer or a court order that determines a member insurer to be |
an insolvent insurer. A person may be a resident of only one |
state, which in the case of a person other than a natural |
person shall be its principal place of business. Citizens of |
the United States that are either (i) residents of foreign |
countries or (ii) residents of United States possessions, |
territories, or protectorates that do not have an association |
similar to the Association created by this Article, shall be |
deemed residents of the state of domicile of the insurer that |
issued the policies or contracts. (13) "Resident" means any |
person who resides in this State at the
time the insurer is |
|
determined to be impaired or insolvent and to whom
contractual |
obligations are owed.
A person may be a resident of only one |
state which, in the case of a
person other than a natural |
person, shall be its principal place of business.
|
"Structured settlement annuity" means an annuity purchased |
in order to fund periodic payments for a plaintiff or other |
claimant in payment for or with respect to personal injury |
suffered by the plaintiff or other claimant. |
"State" means a state, the District of Columbia, Puerto |
Rico, and a United States possession, territory, or |
protectorate. |
"Supplemental contract" means a written agreement entered |
into for the distribution of proceeds under a life, health, or |
annuity policy or a life, health, or annuity contract. (14) |
"Supplemental contract" means any agreement entered into for |
the
distribution of policy or contract proceeds.
|
(15) "Unallocated annuity contract" means any annuity |
contract or group
annuity certificate which is not issued to |
and owned by an individual,
except to the extent of any annuity |
benefits guaranteed to an individual by
an insurer under such |
contract or certificate.
|
(Source: P.A. 86-753.)
|
(215 ILCS 5/531.06) (from Ch. 73, par. 1065.80-6)
|
Sec. 531.06. Creation of the Association. There is created |
a
non-profit legal entity to be known as the Illinois Life and |
|
Health
Insurance Guaranty Association. All member insurers are |
and must remain
members of the Association as a condition of |
their authority to transact
insurance in this State. The |
Association must perform its functions under
the plan of |
operation established and approved under Section 531.10 and |
must
exercise its powers through a board of directors |
established under
Section 531.07. For purposes of |
administration and assessment, the Association
must maintain 2 |
accounts:
|
(1) The life insurance and annuity account , which |
includes the following
subaccounts:
|
(a) Life Insurance Account;
|
(b) Annuity account, which shall include annuity |
contracts owned by a governmental retirement plan (or |
its trustee) established under Section 401, 403(b), or |
457 of the United States Internal Revenue Code, but |
shall otherwise exclude unallocated annuities Annuity |
account ; and
|
(c) Unallocated annuity account, which shall |
exclude contracts owned by a governmental retirement |
benefit plan (or its trustee) established under |
Section 401, 403(b), or 457 of the United States |
Internal Revenue Code Unallocated Annuity Account |
which shall include contracts qualified
under Section |
403(b) of the United States Internal Revenue Code .
|
(2) The health insurance account.
|
|
The Association shall be supervised by the Director
and is |
subject to the applicable provisions of the Illinois Insurance
|
Code. Meetings or records of the Association may be opened to |
the public upon majority vote of the board of directors of the |
Association.
|
(Source: P.A. 95-331, eff. 8-21-07.)
|
(215 ILCS 5/531.07) (from Ch. 73, par. 1065.80-7)
|
Sec. 531.07.
Board of Directors.) The board of directors of |
the
Association consists of not less than 7 5 nor more than 11 |
9 members serving
terms as established in the plan of |
operation. The insurers members of the board
are to be selected |
by member insurers subject to the approval of the
Director. In |
addition, 2 persons who must be public representatives may be |
appointed by the Director to the board of directors. A public |
representative may not be an officer, director, or employee of |
an insurance company or any person engaged in the business of |
insurance. Vacancies on the board must be filled for the |
remaining period
of the term in the manner described in the |
plan of operation. To select
the initial board of directors, |
and initially organize the Association,
the Director must give |
notice to all member insurers of the time and
place of the |
organizational meeting. In determining voting rights at the
|
organizational meeting each member insurer is entitled to one |
vote in
person or by proxy. If the board of directors is not |
selected within
60 days after notice of the organizational |
|
meeting, the Director may
appoint the initial members.
|
In approving selections or in appointing members to the |
board, the
Director must consider, whether all member insurers |
are
fairly represented.
|
Members of the board may be reimbursed from the assets of |
the Association
for expenses incurred by them as members of the |
board of directors but
members of the board may not otherwise |
be compensated by the Association for
their services.
|
(Source: P.A. 81-899.)
|
(215 ILCS 5/531.08) (from Ch. 73, par. 1065.80-8)
|
Sec. 531.08. Powers and duties of the Association. |
(a) In addition to
the powers and duties enumerated in |
other Sections of this Article:
|
(1) If a member insurer is an impaired insurer, then |
the Association may, in its discretion and subject to any |
conditions imposed by the Association that do not impair |
the contractual obligations of the impaired insurer and |
that are approved by the Director: |
(A) guarantee, assume, or reinsure or cause to be |
guaranteed, assumed, or reinsured, any or all of the |
policies or contracts of the impaired insurer; or |
(B) provide such money, pledges, loans, notes, |
guarantees, or other means as are proper to effectuate |
paragraph (A) and assure payment of the contractual |
obligations of the impaired insurer pending action |
|
under paragraph (A). |
(2) If a member insurer is an insolvent insurer, then |
the Association shall, in its discretion, either: |
(A) guaranty, assume, or reinsure or cause to be |
guaranteed, assumed, or reinsured the policies or |
contracts of the insolvent insurer or assure payment of |
the contractual obligations of the insolvent insurer |
and provide money, pledges, loans, notes, guarantees, |
or other means reasonably necessary to discharge the |
Association's duties; or |
(B) provide benefits and coverages in accordance |
with the following provisions: |
(i) with respect to life and health insurance |
policies and annuities, ensure payment of benefits |
for premiums identical to the premiums and |
benefits (except for terms of conversion and |
renewability) that would have been payable under |
the policies or contracts of the insolvent insurer |
for claims incurred: |
(a) with respect to group policies and |
contracts, not later than the earlier of the |
next renewal date under those policies or |
contracts or 45 days, but in no event less than |
30 days, after the date on which the |
Association becomes obligated with respect to |
the policies and contracts; |
|
(b) with respect to nongroup policies, |
contracts, and annuities not later than the |
earlier of the next renewal date (if any) under |
the policies or contracts or one year, but in |
no event less than 30 days, from the date on |
which the Association becomes obligated with |
respect to the policies or contracts; |
(ii) make diligent efforts to provide all |
known insureds or annuitants (for nongroup |
policies and contracts), or group policy owners |
with respect to group policies and contracts, 30 |
days notice of the termination (pursuant to |
subparagraph (i) of this paragraph (B)) of the |
benefits provided; |
(iii) with respect to nongroup life and health |
insurance policies and annuities covered by the |
Association, make available to each known insured |
or annuitant, or owner if other than the insured or |
annuitant, and with respect to an individual |
formerly insured or formerly an annuitant under a |
group policy who is not eligible for replacement |
group coverage, make available substitute coverage |
on an individual basis in accordance with the |
provisions of paragraph (3), if the insureds or |
annuitants had a right under law or the terminated |
policy or annuity to convert coverage to |
|
individual coverage or to continue an individual |
policy or annuity in force until a specified age or |
for a specified time, during which the insurer had |
no right unilaterally to make changes in any |
provision of the policy or annuity or had a right |
only to make changes in premium by class.
|
(1) If a domestic insurer is an impaired insurer, the |
Association
may, subject to any conditions imposed by the |
Association other than
those which impair the contractual |
obligations of the impaired insurer,
and approved by the |
impaired insurer and the Director:
|
(a) Guarantee or reinsure, or cause to be |
guaranteed, assumed or
reinsured, any or all of the |
covered policies of covered persons of the
impaired |
insurer;
|
(b) Provide such monies, pledges, notes, |
guarantees, or other means
as are proper to effectuate |
paragraph (a), and assure payment of the
contractual |
obligations of the impaired insurer pending action |
under
paragraph (a);
|
(c) Loan money to the impaired insurer;
|
(2) If a domestic, foreign, or alien insurer is an |
insolvent
insurer, the Association
shall, subject to the |
approval of the Director;
|
(a)(i) Guarantee, assume or reinsure or cause to be |
guaranteed,
assumed, or reinsured the covered policies |
|
of covered persons of the
insolvent insurer;
|
(ii) Assure payment of the contractual obligations |
of the insolvent
insurer to covered persons;
|
(iii) Provide such monies, pledges, notes, |
guaranties, or other means
as are reasonably necessary |
to discharge such duties; or
|
(b) with respect to only life and health insurance |
policies, provide
benefits and coverages in accordance |
with Section 531.08(3).
|
(c) Provided however
that this subsection (2) |
shall not apply when the Director has determined
that |
the foreign or alien insurers domiciliary jurisdiction |
or state of
entry provides, by statute, protection |
substantially similar to that
provided by this Article |
for residents of this State and such protection
will be |
provided in a timely manner.
|
(3) When proceeding under subparagraph (2)(b) of this |
Section the
Association shall, with respect to only life |
and health insurance policies:
|
(a) assure payment of benefits for premiums |
identical to the premiums
and benefits (except for |
terms of conversion and renewability) that would
have |
been payable under the policies of the insolvent |
insurer, for claims
incurred:
|
(i) with respect to group policies, not later |
than the earlier of the
next renewal date under |
|
such policies or contracts or sixty days, but in no
|
event less than thirty days, after the date on |
which the Association
becomes obligated with |
respect to such policies;
|
(ii) with respect to non-group policies, not |
later than the earlier of
the next renewal date (if |
any) under such policies or one year, but in no
|
event less than thirty days, from the date on which |
the Association becomes
obligated with respect to |
such policies;
|
(b) make diligent efforts to provide all known |
insureds or group
policyholders with respect to group |
policies thirty days notice of the
termination of the |
benefits provided; and
|
(c) with respect to non-group policies, make |
available to each known
insured, or owner if other than |
the insured, and with respect to an
individual formerly |
insured under a group policy who is not eligible for
|
replacement group coverage, make available substitute |
coverage on an
individual basis in accordance with the |
provisions of subparagraph (3)(d) of
this Section, if |
the insureds had a right under law or the terminated
|
policy to convert coverage to individual coverage or to |
continue a
non-group policy in force until a specified |
age or for a specified time,
during which the insurer |
has no right unilaterally to make changes in any
|
|
provision of the policy or had a right only to make |
changes in premium by
class.
|
(b) (d)(i) In providing the substitute coverage required |
under subparagraph (iii) of paragraph (B) of item (2) of |
subsection (a)
(3)(c) of this Section, the Association may |
offer either to reissue the
terminated coverage or to issue an |
alternative policy.
|
(ii) Alternative or reissued policies shall be offered |
without requiring
evidence of insurability, and shall not |
provide for any waiting period or
exclusion that would not have |
applied under the terminated policy.
|
(iii) The Association may reinsure any alternative or |
reissued policy.
|
(e)(i) Alternative policies adopted by the Association |
shall be subject
to the approval of the Director. The |
Association may adopt alternative
policies of various types for |
future insurance without regard to any
particular impairment or |
insolvency.
|
(ii) Alternative policies shall contain at least the |
minimum statutory
provisions required in this State and provide |
benefits that shall not be
unreasonable in relation to the |
premium charged. The
Association shall set the premium in |
accordance with a table of rates which
it shall adopt. The |
premium shall reflect the amount of insurance to be
provided |
and the age and class of risk of each insured, but shall not
|
reflect any changes in the health of the insured after the |
|
original policy
was last underwritten.
|
(iii) Any alternative policy issued by the Association |
shall provide
coverage of a type similar to that of the policy |
issued by the impaired or
insolvent insurer, as determined by |
the Association.
|
(c) (f) If the Association elects to reissue terminated |
coverage at a
premium rate different from that charged under |
the terminated policy, the
premium shall be set by the |
Association in accordance with the amount of
insurance provided |
and the age and class of risk, subject to approval of
the |
Director or by a court of competent jurisdiction.
|
(d) (g) The Association's obligations with respect to |
coverage under any
policy of the impaired or insolvent insurer |
or under any reissued or
alternative policy shall cease on the |
date such coverage or policy is
replaced by another similar |
policy by the policyholder, the insured, or the
Association.
|
(e) (4) When proceeding under subparagraph (2)(b) of this |
Section with
respect to any policy or contract carrying |
guaranteed minimum interest
rates, the Association shall |
assure the payment or crediting of a rate of
interest |
consistent with subparagraph (2)(b)(iii)(B) of Section 531.03.
|
(f) (5) Nonpayment of premiums thirty-one days after the |
date required under
the terms of any guaranteed, assumed, |
alternative or reissued policy or
contract or substitute |
coverage shall terminate the Association's
obligations under |
such policy or coverage under this Act with respect to
such |
|
policy or coverage, except with respect to any claims incurred |
or any
net cash surrender value which may be due in accordance |
with the provisions of
this Act.
|
(g) (6) Premiums due for coverage after entry of an order |
of liquidation of
an insolvent insurer shall belong to and be |
payable at the direction of the
Association,
and the |
Association shall be liable for unearned premiums due to policy |
or
contract owners arising after the entry of such order.
|
(h) In carrying out its duties under paragraph (2) of |
subsection (a) of this Section, the Association may: |
(1) subject to approval by a court in this State, |
impose permanent policy or contract liens in connection |
with a guarantee, assumption, or reinsurance agreement if |
the Association finds that the amounts which can be |
assessed under this Article are less than the amounts |
needed to assure full and prompt performance of the |
Association's duties under this Article or that the |
economic or financial conditions as they affect member |
insurers are sufficiently adverse to render the imposition |
of such permanent policy or contract liens to be in the |
public interest; or |
(2) subject to approval by a court in this State, |
impose temporary moratoriums or liens on payments of cash |
values and policy loans or any other right to withdraw |
funds held in conjunction with policies or contracts in |
addition to any contractual provisions for deferral of cash |
|
or policy loan value. In addition, in the event of a |
temporary moratorium or moratorium charge imposed by the |
receivership court on payment of cash values or policy |
loans or on any other right to withdraw funds held in |
conjunction with policies or contracts, out of the assets |
of the impaired or insolvent insurer, the Association may |
defer the payment of cash values, policy loans, or other |
rights by the Association for the period of the moratorium |
or moratorium charge imposed by the receivership court, |
except for claims covered by the Association to be paid in |
accordance with a hardship procedure established by the |
liquidator or rehabilitator and approved by the |
receivership court.
|
(7) (a) In carrying out its duties under subsection |
(2),
permanent policy liens, or contract liens, may be |
imposed in connection
with any guarantee, assumption or |
reinsurance agreement, if the court:
|
(i) Finds that the amounts which can be assessed |
under this Act are
less than the amounts needed to |
assure full and prompt performance of
the insolvent |
insurer's contractual obligations, or that the |
economic or
financial conditions as they affect member |
insurers are sufficiently
adverse to render the |
imposition of policy or contract liens, to be in
the |
public interest; and
|
(ii) Approves the specific policy liens or |
|
contract liens to be used.
|
(b) Before being obligated under subsection (2) the
|
Association may request that there be imposed temporary |
moratoriums or
liens on payments of cash values and policy |
loans in addition to any
contractual provisions for |
deferral of cash or policy loan
values, and such
temporary |
moratoriums and liens may be imposed if they are approved |
by
the court.
|
(i) (8) There shall be no liability on the part of and no |
cause of action
shall arise against the Association or against |
any transferee from the
Association in connection with the |
transfer by reinsurance or otherwise of
all or any part of an |
impaired or insolvent insurer's business by reason of
any |
action taken or any failure to take any action by the impaired |
or
insolvent insurer at any time.
|
(j) (9) If the Association fails to act within a reasonable |
period of
time as provided in subsection (2) of this Section |
with respect to an
insolvent insurer, the
Director shall have |
the powers and duties of the Association under this
Act with |
regard to such insolvent insurers.
|
(k) (10) The Association or its designated representatives
|
may render assistance and advice to the
Director, upon his |
request, concerning rehabilitation, payment of
claims, |
continuations of coverage, or the performance of other
|
contractual obligations of any impaired or insolvent insurer.
|
(l) The Association shall have standing to appear or |
|
intervene before a court or agency in this State with |
jurisdiction over an impaired or insolvent insurer concerning |
which the Association is or may become obligated under this |
Article or with jurisdiction over any person or property |
against which the Association may have rights through |
subrogation or otherwise. Standing shall extend to all matters |
germane to the powers and duties of the Association, including, |
but not limited to, proposals for reinsuring, modifying, or |
guaranteeing the policies or contracts of the impaired or |
insolvent insurer and the determination of the policies or |
contracts and contractual obligations. The Association shall |
also have the right to appear or intervene before a court or |
agency in another state with jurisdiction over an impaired or |
insolvent insurer for which the Association is or may become |
obligated or with jurisdiction over any person or property |
against whom the Association may have rights through |
subrogation or otherwise. (11) The Association has standing to |
appear before any court concerning
all matters germane to the |
powers and duties of
the Association, including, but not |
limited to, proposals for reinsuring
or guaranteeing the |
covered policies of the impaired or insolvent
insurer and the |
determination of the covered policies and contractual
|
obligations.
|
(m)(1) A person receiving benefits under this Article shall |
be deemed to have assigned the rights under and any causes of |
action against any person for losses arising under, resulting |
|
from, or otherwise relating to the covered policy or contract |
to the Association to the extent of the benefits received |
because of this Article, whether the benefits are payments of |
or on account of contractual obligations, continuation of |
coverage, or provision of substitute or alternative coverages. |
The Association may require an assignment to it of such rights |
and cause of action by any payee, policy, or contract owner, |
beneficiary, insured, or annuitant as a condition precedent to |
the receipt of any right or benefits conferred by this Article |
upon the person. (12) (a) Any person receiving benefits under |
this Article is deemed
to have assigned the rights under the |
covered policy
to the Association
to the extent of the benefits |
received because of this Article whether
the benefits are |
payments of contractual obligations or continuation of
|
coverage. The Association may require an assignment to it of |
such
rights by any payee, policy or contract owner, |
beneficiary, insured,
certificate holder or
annuitant as a |
condition precedent to the receipt of any rights or
benefits |
conferred by this Article upon such person. The Association is
|
subrogated to these rights against the assets of any insolvent |
insurer.
|
(2) (b) The subrogation rights of the Association under this |
subsection
have the same priority against the assets of the |
impaired or insolvent insurer as
that possessed by the person |
entitled to receive benefits under this
Article. |
(3) In addition to paragraphs (1) and (2), the Association |
|
shall have all common law rights of subrogation and any other |
equitable or legal remedy that would have been available to the |
impaired or insolvent insurer or owner, beneficiary, or payee |
of a policy or contract with respect to the policy or |
contracts, including without limitation, in the case of a |
structured settlement annuity, any rights of the owner, |
beneficiary, or payee of the annuity to the extent of benefits |
received pursuant to this Article, against a person originally |
or by succession responsible for the losses arising from the |
personal injury relating to the annuity or payment therefor, |
excepting any such person responsible solely by reason of |
serving as an assignee in respect of a qualified assignment |
under Internal Revenue Code Section 130. |
(4) If the preceding provisions of this subsection (l) are |
invalid or ineffective with respect to any person or claim for |
any reason, then the amount payable by the Association with |
respect to the related covered obligations shall be reduced by |
the amount realized by any other person with respect to the |
person or claim that is attributable to the policies, or |
portion thereof, covered by the Association. |
(5) If the Association has provided benefits with respect |
to a covered obligation and a person recovers amounts as to |
which the Association has rights as described in the preceding |
paragraphs of this subsection (10), then the person shall pay |
to the Association the portion of the recovery attributable to |
the policies, or portion thereof, covered by the Association.
|
|
(n) (13) The Association may:
|
(1) (a) Enter into such contracts as are necessary or |
proper to carry
out the provisions and purposes of this |
Article;
|
(2) (b) Sue or be sued, including taking any legal |
actions necessary or
proper for recovery of any unpaid |
assessments under Section 531.09. The
Association shall |
not be liable for punitive or exemplary damages;
|
(3) (c) Borrow money to effect the purposes of this |
Article. Any notes
or other evidence of indebtedness of the |
Association not in default are
legal investments for |
domestic insurers and may be carried as admitted
assets.
|
(4) (d) Employ or retain such persons as are necessary |
to handle the
financial transactions of the Association, |
and to perform such other
functions as become necessary or |
proper under this Article.
|
(5) (e) Negotiate and contract with any liquidator, |
rehabilitator,
conservator, or ancillary receiver to carry |
out the powers and duties of
the Association.
|
(6) (f) Take such legal action as may be necessary to |
avoid payment of
improper claims.
|
(7) (g) Exercise, for the purposes of this Article and |
to the extent
approved by the Director, the powers of a |
domestic life or health
insurer, but in no case may the |
Association issue insurance policies or
annuity contracts |
other than those issued to perform the contractual
|
|
obligations of the impaired or insolvent insurer.
|
(8) (h) Exercise all the rights of the Director under |
Section 193(4) of
this Code with respect to covered |
policies after the association becomes
obligated by |
statute.
|
(9) Request information from a person seeking coverage |
from the Association in order to aid the Association in |
determining its obligations under this Article with |
respect to the person, and the person shall promptly comply |
with the request. |
(10) Take other necessary or appropriate action to |
discharge its duties and obligations under this Article or |
to exercise its powers under this Article.
|
(o) (14) With respect to covered policies for which the |
Association becomes
obligated after an entry of an order of |
liquidation or rehabilitation,
the Association may
elect to |
succeed to the rights of the insolvent insurer arising after |
the
date of the order of liquidation or rehabilitation under |
any contract
of reinsurance to which
the insolvent insurer was |
a party, to the extent that such contract
provides coverage for |
losses occurring after the date of the order of
liquidation or |
rehabilitation. As a condition to making this election,
the |
Association must pay all unpaid premiums due under the contract |
for
coverage relating to periods before and after the date of |
the order of
liquidation or rehabilitation.
|
(p) A deposit in this State, held pursuant to law or |
|
required by the Director for the benefit of creditors, |
including policy owners, not turned over to the domiciliary |
liquidator upon the entry of a final order of liquidation or |
order approving a rehabilitation plan of an insurer domiciled |
in this State or in a reciprocal state, pursuant to Article |
XIII 1/2 of this Code, shall be promptly paid to the |
Association. The Association shall be entitled to retain a |
portion of any amount so paid to it equal to the percentage |
determined by dividing the aggregate amount of policy owners' |
claims related to that insolvency for which the Association has |
provided statutory benefits by the aggregate amount of all |
policy owners' claims in this State related to that insolvency |
and shall remit to the domiciliary receiver the amount so paid |
to the Association less the amount retained pursuant to this |
subsection (13). Any amount so paid to the Association and |
retained by it shall be treated as a distribution of estate |
assets pursuant to applicable State receivership law dealing |
with early access disbursements. |
(q) The Board of Directors of the Association shall have |
discretion and may exercise reasonable business judgment to |
determine the means by which the Association is to provide the |
benefits of this Article in an economical and efficient manner. |
(r) Where the Association has arranged or offered to |
provide the benefits of this Article to a covered person under |
a plan or arrangement that fulfills the Association's |
obligations under this Article, the person shall not be |
|
entitled to benefits from the Association in addition to or |
other than those provided under the plan or arrangement. |
(s) Venue in a suit against the Association arising under |
the Article shall be in Cook County. The Association shall not |
be required to give any appeal bond in an appeal that relates |
to a cause of action arising under this Article. |
(t) The Association may join an organization of one or more |
other State associations of similar purposes to further the |
purposes and administer the powers and duties of the |
Association. |
(u) In carrying out its duties in connection with |
guaranteeing, assuming, or reinsuring policies or contracts |
under subsections (1) or (2), the Association may, subject to |
approval of the receivership court, issue substitute coverage |
for a policy or contract that provides an interest rate, |
crediting rate, or similar factor determined by use of an index |
or other external reference stated in the policy or contract |
employed in calculating returns or changes in value by issuing |
an alternative policy or contract in accordance with the |
following provisions: |
(1) in lieu of the index or other external reference |
provided for in the original policy or contract, the |
alternative policy or contract provides for (i) a fixed |
interest rate, or (ii) payment of dividends with minimum |
guarantees, or (iii) a different method for calculating |
interest or changes in value; |
|
(2) there is no requirement for evidence of |
insurability, waiting period, or other exclusion that |
would not have applied under the replaced policy or |
contract; and |
(3) the alternative policy or contract is |
substantially similar to the replaced policy or contract in |
all other material terms. |
(Source: P.A. 93-326, eff. 1-1-04.)
|
(215 ILCS 5/531.09) (from Ch. 73, par. 1065.80-9)
|
Sec. 531.09. Assessments. |
(1) For the purpose of providing the funds
necessary to |
carry out the powers and duties of the Association, the board
|
of directors shall assess the member insurers, separately for |
each account, at such
times and for such amounts as the board |
finds necessary. Assessments shall
be due not less than 30 days |
after written notice to the member insurers
and shall accrue |
interest from the due date at such adjusted rate as is
|
established under Section 6621 of Chapter 26 of the United |
States Code and
such interest shall be compounded daily.
|
(2) There shall be 2 classes of assessments, as follows:
|
(a) Class A assessments shall be made for the purpose |
of meeting administrative
costs and other general expenses |
and examinations conducted under the authority
of the |
Director under subsection (5) of Section 531.12.
|
(b) Class B assessments shall be made to the extent |
|
necessary to carry
out the powers and duties of the |
Association under Section 531.08 with regard
to an impaired |
or insolvent domestic insurer or insolvent foreign or alien |
insurers.
|
(3)(a) The amount of any Class A assessment shall be |
determined at the discretion of the board of directors and such |
assessments shall be authorized and called on a non-pro rata |
basis. The amount of any Class B
assessment shall be allocated |
for assessment
purposes among the accounts
and subaccounts |
pursuant to an allocation formula which may be based on
the |
premiums or reserves of the impaired or insolvent insurer or |
any other
standard deemed by the board in its sole discretion |
as being fair and
reasonable under the circumstances.
|
(b) Class B assessments against member insurers for each |
account and
subaccount shall
be in the proportion that the |
premiums received on business in this State
by each assessed |
member insurer on policies or contracts covered by
each account |
or subaccount for the three most recent calendar years
for |
which information is available preceding the year in which the |
insurer
became impaired or insolvent, as the case may be, bears |
to such premiums
received on business in this State for such |
calendar years by all assessed
member insurers.
|
(c) Assessments for funds to meet the requirements of the |
Association
with respect to an impaired or insolvent insurer |
shall not be made until
necessary to implement the purposes of |
this Article. Classification
of assessments
under subsection |
|
(2) and computations of assessments under this subsection
shall |
be made with a reasonable degree of accuracy, recognizing that |
exact
determinations may not always be possible.
|
(4) The Association may abate or defer, in whole or in |
part, the assessment of a member insurer if, in the opinion of |
the board, payment of the assessment would endanger the ability |
of the member insurer to fulfill its contractual obligations. |
In the event an assessment against a member insurer is abated |
or deferred in whole or in part the amount by which the |
assessment is abated or deferred may be assessed against the |
other member insurers in a manner consistent with the basis for |
assessments set forth in this Section. Once the conditions that |
caused a deferral have been removed or rectified, the member |
insurer shall pay all assessments that were deferred pursuant |
to a repayment plan approved by the Association. |
(5) (a) Subject to the provisions of subparagraph (ii) of |
this paragraph, the total of all assessments authorized by the |
Association with respect to a member insurer for each |
subaccount of the life insurance and annuity account and for |
the health account shall not in one calendar year exceed 2% of |
that member insurer's average annual premiums received in this |
State on the policies and contracts covered by the subaccount |
or account during the 3 calendar years preceding the year in |
which the insurer became an impaired or insolvent insurer. |
If 2 or more assessments are authorized in one calendar |
year with respect to insurers that become impaired or insolvent |
|
in different calendar years, the average annual premiums for |
purposes of the aggregate assessment percentage limitation |
referenced in subparagraph (a) of this paragraph shall be equal |
and limited to the higher of the 3-year average annual premiums |
for the applicable subaccount or account as calculated pursuant |
to this Section. |
If the maximum assessment, together with the other assets |
of the Association in an account, does not provide in one year |
in either account an amount sufficient to carry out the |
responsibilities of the Association, the necessary additional |
funds shall be assessed as soon thereafter as permitted by this |
Article. |
(b) The board may provide in the plan of operation a method |
of allocating funds among claims, whether relating to one or |
more impaired or insolvent insurers, when the maximum |
assessment will be insufficient to cover anticipated claims. |
(c) If the maximum assessment for a subaccount of the life |
and annuity account in one year does not provide an amount |
sufficient to carry out the responsibilities of the |
Association, then pursuant to paragraph (b) of subsection (3), |
the board shall assess the other subaccounts of the life and |
annuity account for the necessary additional amount, subject to |
the maximum stated in paragraph (a) of this subsection. |
(4) The Association may abate or defer, in whole or in |
part, the assessment
of a member insurer if, in the opinion of |
the board, payment of the assessment
would endanger the ability |
|
of the member insurer to fulfill its contractual
obligations. |
The total of all assessments upon a member insurer for the
life |
and annuity
account and for each subaccount thereunder may not |
in any one calendar
year exceed 2% and for the health account |
may not in any one calendar
year exceed 2% of such insurer's
|
average premiums received in this State on the policies and |
contracts
covered by the account or subaccount during the three |
calendar years
preceding the year in which the insurer became |
an impaired or insolvent
insurer. If a one percent assessment |
for any subaccount of the life and
annuity account in any one |
year does not provide an amount sufficient to
carry out the |
responsibilities of the Association, then pursuant to
|
subsection 3(b), the board shall access all subaccounts of the |
life and
annuity account for the necessary additional amount, |
subject to the maximum
stated in this subsection.
|
(5) In the event an assessment against a member insurer is |
abated, or deferred,
in whole or in part, because of the |
limitations set forth in subsection (4) of this
Section the |
amount by which such assessment is abated or deferred, may be
|
assessed against the other member insurers in a manner |
consistent with the
basis for assessments set forth in this |
Section. If the maximum assessment,
together with the other |
assets of the Association in either account, does
not provide |
in any
one year in either account an amount sufficient to carry |
out the
responsibilities
of the Association, the necessary |
additional funds may be assessed as soon
thereafter
as |
|
permitted by this Article.
The board may provide in the plan of |
operation a method of allocating
funds among claims, whether |
relating to one or more impaired or insolvent
insurers, when |
the maximum assessment will be insufficient to cover |
anticipated
claims.
|
(6) The board may, by an equitable method as established in |
the
plan of operation, refund to member insurers, in proportion |
to the contribution
of each insurer to that account, the amount |
by which the assets of the account
exceed the amount the board |
finds is necessary to carry out during the coming
year the |
obligations of the Association with regard to that account, |
including
assets accruing from net realized gains and income |
from investments. A
reasonable amount may be retained in any |
account to provide funds for the
continuing expenses of the |
Association and for future losses if refunds are
impractical .
|
(7) An assessment is deemed to occur on the date upon which |
the board
votes such assessment. The board may defer calling |
the payment of the
assessment or may call for payment in one or |
more installments.
|
(8) It is proper for any member insurer, in determining its |
premium
rates and policyowner dividends as to any kind of |
insurance within the scope of
this Article, to consider the |
amount reasonably necessary to meet its assessment
obligations |
under this Article.
|
(9) The Association must issue to each insurer paying a
|
Class B assessment
under this Article a certificate of |
|
contribution,
in a form acceptable to the
Director, for the |
amount of the assessment so paid. All outstanding certificates
|
are of equal
dignity and priority without reference to amounts |
or dates of issue. A certificate
of contribution may be shown |
by the insurer in its financial statement as an asset
in such |
form and for such amount, if any, and period of time as the |
Director
may approve, provided the insurer shall in any event |
at its option have
the right to show a certificate of |
contribution as an admitted asset at
percentages of the |
original face amount for calendar years as follows:
|
100% for the calendar year after the year of issuance;
|
80% for the second calendar year after the year of |
issuance;
|
60% for the third calendar year after the year of issuance;
|
40% for the fourth calendar year after the year of |
issuance;
|
20% for the fifth calendar year after the year of issuance.
|
(10) The Association may request information of member |
insurers in order to aid in the exercise of its power under |
this Section and member insurers shall promptly comply with a |
request. |
(Source: P.A. 95-86, eff. 9-25-07 (changed from 1-1-08 by P.A. |
95-632).)
|
(215 ILCS 5/531.10) (from Ch. 73, par. 1065.80-10)
|
Sec. 531.10.
Plan of Operation.) (1) (a) The Association |
|
must
submit to the Director a plan of operation and any |
amendments thereto necessary
or suitable to assure the fair, |
reasonable, and equitable administration of the
Association. |
The plan of operation and any amendments thereto become |
effective
upon approval in writing by the Director.
|
(b) If the Association fails to submit a suitable plan of |
operation
within 180 days following the effective date of this |
Article or if at any time
thereafter the Association fails to |
submit suitable amendments to the plan, the
Director may, after |
notice and hearing, adopt and promulgate such reasonable
rules |
as are necessary or advisable to effectuate the provisions of |
this Article.
Such rules are in force until modified by the |
Director or superseded by a plan
submitted by the Association |
and approved by the Director.
|
(2) All member insurers must comply with the plan of |
operation.
|
(3) The plan of operation must, in addition to requirements |
enumerated
elsewhere in this Article:
|
(a) Establish procedures for handling the assets of the |
Association;
|
(b) Establish the amount and method of reimbursing |
members of the
board of directors under Section 531.07;
|
(c) Establish regular places and times for meetings of |
the board
of directors;
|
(d) Establish procedures for records to be kept of all |
financial
transactions of the Association, its agents, and |
|
the board of directors;
|
(e) Establish the procedures whereby selections for |
the board
of directors will be made and submitted to the |
Director;
|
(f) Establish any additional procedures for |
assessments under
Section 531.09; and
|
(g) Contain additional provisions necessary or proper |
for the execution
of the powers and duties of the |
Association.
|
(4) The plan of operation shall establish a procedure for |
protest by
any member insurer of assessments made by the |
Association pursuant to
Section 531.09. Such procedures shall |
require that:
|
(a) a member insurer that wishes to protest all or part |
of an assessment shall pay when due the full amount of the |
assessment as set forth in the notice provided by the |
Association. The payment shall be available to meet |
Association obligations during the pendency of the protest |
or any subsequent appeal. Payment shall be accompanied by a |
statement in writing that the payment is made under protest |
and setting forth a brief statement of the grounds for the |
protest; Any member insurer that wishes to protest all or |
any part of an
assessment for any year shall first pay the |
full amount of the assessment
as set forth in the notice |
provided by the Association. Such payments
shall be |
accompanied by a statement in writing that the payment is |
|
made
under protest, setting forth a brief statement of the |
ground for the
protest. The Association shall hold such |
payments in a separate interest
bearing account.
|
(b) within Within 30 days following the payment of an |
assessment under
protest by any protesting member insurer, |
the Association must notify the
member insurer in writing |
of its determination with respect to the protest
unless the |
Association notifies the member that additional time is |
required
to resolve the issues raised by the protest ; .
|
(c) in In the event the Association determines that the |
protesting member
insurer is entitled to a refund, such |
refund shall be made within 30
days following the date upon |
which the Association makes its determination ; .
|
(d) the The decision of the Association with respect to |
a protest may be
appealed to the Director pursuant to |
Section 531.11(3) ; .
|
(e) in In the alternative to rendering a decision with |
respect to any
protest based on a question regarding the |
assessment base, the Association
may refer such protests to |
the Director for final decision, with or without
a |
recommendation from the Association ; and .
|
(f) interest Interest on any refund due a protesting |
member insurer shall be paid
at the rate actually earned by |
the Association on the separate account .
|
(5) The plan of operation may provide that any or all |
powers and duties
of the Association, except those under |
|
paragraph (c) of subsection (10)
of Section 531.08 and Section |
531.09 are delegated to a corporation,
association or other |
organization which performs or will perform functions
similar |
to those of this Association, or its equivalent, in 2 or more |
states.
Such a corporation, association or organization shall |
be reimbursed for any
payments made on behalf of the |
Association and shall be paid for its
performance of any |
function of the Association. A delegation under this
subsection |
shall take effect only with the approval of both the Board of
|
Directors and the Director, and may be made only to a |
corporation, association
or organization which extends |
protection not substantially less favorable and
effective than |
that provided by this Act.
|
(Source: P.A. 84-1035.)
|
(215 ILCS 5/531.11) (from Ch. 73, par. 1065.80-11)
|
Sec. 531.11. Duties and powers of the Director. In addition |
to
the duties and powers enumerated elsewhere in this Article:
|
(1) The Director must do all of the following :
|
(a) Upon request of the board of directors, provide the |
Association with
a statement of the premiums in the |
appropriate accounts for each
member insurer.
|
(b) Notify notify the board of directors of the |
existence of an impaired or
insolvent
insurer not later |
than 3 days after a determination of impairment or |
insolvency
is made or when the Director receives notice of |
|
impairment or insolvency.
|
(c) Give give notice to an impaired insurer as required |
by Sections
34 or 60. Notice to the impaired insurer shall |
constitute
notice to its shareholders, if any.
|
(d) In any liquidation or rehabilitation proceeding |
involving
a domestic insurer, be appointed as the |
liquidator or rehabilitator. If
a foreign or alien member |
insurer is subject to a liquidation proceeding
in its |
domiciliary
jurisdiction or state of entry, the Director |
shall be appointed conservator.
|
(2) The Director may suspend or revoke, after notice and |
hearing,
the certificate of authority to transact insurance in |
this State of any member
insurer which fails to pay an |
assessment when due or fails to comply with the
plan
of |
operation. As an alternative the Director may levy a forfeiture |
on any
member
insurer which fails to pay an assessment when |
due. Such forfeiture may not
exceed
5% of the unpaid assessment |
per month, but no forfeiture may be less than
$100 per month.
|
(3) Any action of the board of directors or the Association |
may be
appealed to the Director by any member insurer or any |
other person
adversely affected by such action if such appeal |
is taken within 30
days of the action being appealed. Any final |
action or order of the Director
is subject to judicial review |
in a court of competent jurisdiction.
|
(4) The liquidator, rehabilitator, or conservator of any |
impaired insurer
may notify all interested persons of the |
|
effect of this Article.
|
(Source: P.A. 89-97, eff. 7-7-95.)
|
(215 ILCS 5/531.12) (from Ch. 73, par. 1065.80-12)
|
Sec. 531.12. Prevention of Insolvencies. To aid in the |
detection and
prevention of insurer insolvencies or |
impairments:
|
(1) It shall be the duty of the Director:
|
(a) To notify the Commissioners of all other states, |
territories of the
United States, and the District of Columbia |
when he takes any of the following
actions against a member |
insurer:
|
(i) revocation of license;
|
(ii) suspension of license;
|
(iii) makes any formal order except for an order issued |
pursuant to
Article XII 1/2 of this Code that such company |
restrict its premium writing,
obtain additional contributions |
to surplus, withdraw from the State,
reinsure all or any part |
of its business, or increase capital, surplus or
any other |
account for the security of policyholders or creditors.
|
Such notice shall be transmitted to all commissioners
|
within 30 days following
the action taken or the date on which |
the action occurs.
|
(b) To report to the board of directors when he has taken |
any of the actions
set forth in subparagraph (a) of this |
paragraph or has received a report
from any other commissioner |
|
indicating that any such action has been taken
in another |
state. Such report to the board of directors shall contain all
|
significant details of the action taken or the report received |
from another
commissioner.
|
(c) To report to the board of directors when the Director |
has reasonable cause to believe from an examination, whether |
completed or in process, of any member insurer that the insurer |
may be an impaired or insolvent insurer. |
(d) To furnish to the board of directors the National |
Association of Insurance Commissioners Insurance Regulatory |
Information System ratios and listings of companies not |
included in the ratios developed by the National Association of |
Insurance Commissioners. The board may use the information |
contained therein in carrying out its duties and |
responsibilities under this Section. The report and the |
information contained therein shall be kept confidential by the |
board of directors until such time as made public by the |
Director or other lawful authority. |
(2) The Director may seek the advice and recommendations of |
the board
of directors concerning any matter affecting his |
duties and responsibilities
regarding the financial condition |
of member companies and companies seeking admission
to transact |
insurance business in this State.
|
(3) The board of directors may, upon majority vote, make |
reports and recommendations
to the Director upon any matter |
germane to the liquidation, rehabilitation
or conservation of |
|
any member insurer. Such reports
and recommendations shall not |
be considered public documents.
|
(4) The board of directors may, upon majority vote, make |
recommendations
to the Director for the detection and |
prevention of insurer insolvencies.
|
(5) The board of directors shall, at the conclusion of any
|
insurer insolvency
in which the Association was obligated to |
pay covered claims prepare a report
to the Director containing |
such information as it may have in its possession
bearing on |
the history and causes of such insolvency. The board shall |
cooperate
with the boards of directors of guaranty associations |
in other states in
preparing a report on the history and causes |
for insolvency of a particular
insurer, and may adopt by |
reference any report prepared by such other
associations.
|
(Source: P.A. 86-753.)
|
(215 ILCS 5/531.14) (from Ch. 73, par. 1065.80-14)
|
Sec. 531.14.
Miscellaneous Provisions. ) |
(1) Nothing in this
Article may be construed to reduce the |
liability for unpaid assessments of the insured
of an impaired |
or insolvent insurer operating under a plan with assessment |
liability.
|
(2) Records must be kept of all negotiations and meetings |
in which
the Association or its representatives are involved to |
discuss the activities of the
Association in carrying out its |
powers and duties under Section 531.08. Records of such
|
|
negotiations or meetings may be made public only upon the |
termination of a
liquidation, rehabilitation, or conservation |
proceeding involving the impaired
or insolvent insurer, upon |
the termination of the impairment or insolvency
of the insurer, |
or upon the order
of a court of competent jurisdiction. Nothing |
in this paragraph (2) limits the
duty of the Association to |
render a report of its activities under Section
531.15.
|
(3) For the purpose of carrying out its obligations under |
this Article,
the Association is deemed to be a creditor of the |
impaired or insolvent
insurer to the extent of assets |
attributable to covered policies reduced by any
amounts to |
which the Association is entitled as subrogee (under paragraph |
(8)
of Section 531.08). All assets of the impaired or insolvent |
insurer
attributable to covered policies must be used to |
continue all covered policies
and pay all contractual |
obligations of the impaired insurer as required by this
|
Article. "Assets attributable to covered policies", as used in |
this paragraph
(3), is that proportion of the
assets which the |
reserves that should have been established
for such policies |
bear to the reserve that should have been
established for all |
policies of
insurance written by the impaired or insolvent |
insurer.
|
(4) (a) Prior to the termination of any liquidation, |
rehabilitation,
or conservation proceeding, the court may take |
into consideration the contributions
of the respective |
parties, including the Association, the shareholders and
|
|
policyowners of the impaired or insolvent insurer, and any |
other party with
a bona fide interest,
in making an equitable |
distribution of the ownership rights of such impaired
or |
insolvent
insurer. In such a determination, consideration must |
be given to the welfare of the
policyholders of the continuing |
or successor insurer.
|
(b) No distribution to stockholders, if any, of an impaired |
or insolvent insurer
may be made until and unless the total
|
amount of valid claims of the Association for funds expended in |
carrying
out its powers and duties under Section 531.08, with |
respect to such insurer
have been fully recovered by the |
Association.
|
(5) (a) If an order for liquidation or rehabilitation of
an |
insurer
domiciled in this State has been entered, the receiver |
appointed under such
order has a right to recover on behalf of |
the insurer, from any affiliate that
controlled it, the amount |
of distributions, other than stock dividends paid by
the |
insurer on its capital stock, made at any time during the 5 |
years preceding
the petition for liquidation or rehabilitation |
subject to the limitations of
paragraphs (b) to (d).
|
(b) No such dividend is recoverable if the insurer shows |
that when
paid the distribution was lawful and reasonable, and |
that the insurer did not
know and could not reasonably have |
known that the distribution might adversely affect
the ability |
of the insurer to fulfill its contractual obligations.
|
(c) Any person who as an affiliate that controlled the |
|
insurer at
the time the distributions were paid is liable up to |
the amount of distributions
he received. Any person who was an |
affiliate that controlled the insurer at the
time the |
distributions were declared, is liable up to the amount of |
distributions
he would have received if they had been paid |
immediately. If 2 persons are
liable with respect to the same |
distributions, they are jointly and severally liable.
|
(d) The maximum amount recoverable under subsection (5) of |
this Section is
the amount needed in excess of all other |
available assets of the insolvent insurer
to pay the |
contractual obligations of the insolvent insurer.
|
(e) If any person liable under paragraph (c) of subsection |
(5) of this
Section is insolvent, all its
affiliates that |
controlled it at the time the dividend was paid are jointly and
|
severally liable for any resulting deficiency in the amount |
recovered from
the insolvent affiliate.
|
(6) As a creditor of the impaired or insolvent insurer as |
established in subsection (3) of this Section and consistent |
with subsection (2) of Section 205 of this Code, the |
Association and other similar associations shall be entitled to |
receive a disbursement of assets out of the marshaled assets, |
from time to time as the assets become available to reimburse |
it, as a credit against contractual obligations under this |
Article. If the liquidator has not, within 120 days after a |
final determination of insolvency of an insurer by the |
receivership court, made an application to the court for the |
|
approval of a proposal to disburse assets out of marshaled |
assets to guaranty associations having obligations because of |
the insolvency, then the Association shall be entitled to make |
application to the receivership court for approval of its own |
proposal to disburse these assets. |
(Source: P.A. 81-899.)
|
(215 ILCS 5/531.18) (from Ch. 73, par. 1065.80-18)
|
Sec. 531.18.
Stay of Proceedings - Reopening Default |
Judgments.)
All proceedings in which the insolvent insurer is a |
party in any court in this
State shall be stayed 180 60 days |
from the date an order of liquidation,
rehabilitation, or |
conservation is final to permit proper legal action by the
|
Association on any matters germane to its powers or duties. As |
to a judgment under
any decision, order, verdict, or finding |
based on default the Association may apply
to have such |
judgment set aside by the same court that made such judgment |
and must
be permitted to defend against such suit on the |
merits.
|
(Source: P.A. 82-210.)
|
(215 ILCS 5/537.2) (from Ch. 73, par. 1065.87-2)
|
Sec. 537.2. Obligation of Fund. The Fund shall be obligated |
to the
extent of the covered
claims existing prior to the entry |
of an Order of Liquidation against
an insolvent company and |
arising within
30 days after the entry of such
Order, or before |
|
the policy expiration date if less than 30 days after
the entry |
of such Order, or before the insured replaces the policy or on
|
request effects cancellation, if he does so within 30 days |
after the entry
of such Order. If the entry of an Order of |
Liquidation occurs on or after
October 1, 1975 and before |
October 1, 1977, such obligations shall not:
(i) exceed |
$100,000, or (ii)
include any obligation to refund the first |
$100 of any unearned premium
claim; and if the entry of an |
Order of Liquidation occurs on or after October
1, 1977 and |
before January 1, 1988, such obligations shall
not: (i) exceed
|
$150,000, except that this limitation shall not apply to any |
workers compensation
claims, or (ii)
include any obligation to |
refund the first
$100 of any unearned premium claim; and if the |
entry of an Order of
Liquidation occurs on or after January 1, |
1988 and before January 1, 2011 , such obligations shall not:
|
(i) exceed $300,000, except that this limitation shall not |
apply to any
workers compensation claims, or (ii) include any |
obligation to refund the
first $100 of any unearned premium |
claim or to refund any unearned premium
over $10,000 under any |
one policy. If the entry of an Order of Liquidation occurs on |
or after January 1, 2011, then such obligations shall not: (i) |
exceed $500,000, except that this limitation shall not apply to |
any workers compensation claims or (ii) include any obligation |
to refund the first $100 of any unearned premium claim or |
refund any unearned premium over $10,000 under any one policy. |
In no event shall the Fund be
obligated to a policyholder or |
|
claimant in an amount in excess
of the face amount of the |
policy from which the claim arises.
|
In no event
shall the Fund be liable for any interest on
|
any
judgment entered against the insured or the insolvent |
company, or for any
other
interest claim against the insured or |
the insolvent company, regardless of
whether the insolvent |
company would have been obligated to pay such interest
under |
the terms of its policy. The Fund shall be liable for interest |
at the
statutory rate on money judgments entered against the |
Fund until the judgment
is satisfied.
|
Any obligation of the Fund to defend an insured shall cease |
upon the
Fund's payment or tender of an amount equal to the |
lesser of the Fund's
covered claim obligation limit or the |
applicable policy limit.
|
(Source: P.A. 92-77, eff. 7-12-01.)
|
(215 ILCS 5/545) (from Ch. 73, par. 1065.95)
|
Sec. 545. Effect of paid claims.
|
(a) Every insured or claimant seeking the
protection of |
this Article shall cooperate with the Fund to the same
extent |
as such person would have been required to cooperate with the
|
insolvent company. The Fund shall have all the rights, duties |
and
obligations under the policy to the extent of the covered |
claim payment,
provided the Fund shall have no cause of action |
against the
insured of the insolvent company for any sums it |
has paid out except
such causes of action as the insolvent |
|
company would have had if such
sums had been paid by the |
insolvent company and except as provided in
paragraph (d) of |
this Section.
|
(b) The Fund and any similar organization in another state |
shall be
recognized as claimants in the liquidation of an |
insolvent company for any
amounts paid by them on covered |
claims obligations as determined under this
Article or similar |
laws in other states and shall receive dividends at the
|
priority set forth in paragraph (d) of subsection (1) of |
Section
205 of this
Code ; provided that if, at the time that |
the Liquidator issues a cut-off notice to the Fund in |
anticipation of closing the estate, a reserve has been |
established by the Fund, or any similar organization in another |
state, for the amount of their future administrative expenses |
and loss development associated with unpaid reported pending |
claims, these reserves will be deemed to have been paid as of |
the date of the notice and payment shall be made accordingly .
|
The liquidator of an insolvent company shall be bound by
|
determinations of covered claim eligibility under the Act and |
by settlements
of claims made by
the Fund or a similar |
organization in
another state on the receipt of certification |
of such payments, to the extent
those
determinations or |
settlements satisfy obligations of the Fund, but the receiver
|
shall not be bound in any way by those determinations or |
settlements to the
extent that there remains a claim in the |
estate for amounts in excess of the
payments by the Fund.
In |
|
submitting their claim for covered claim payments the Fund and |
any
similar organization in another state shall not be subject |
to the
requirements of Sections 208 and 209 of this Code and |
shall not be affected
by the failure of the person receiving a |
covered claim payment to file a proof
of claim.
|
(c) The expenses of the Fund and of any similar
|
organization in any other state, other than expenses incurred |
in the
performance of
duties under Section 547 or similar |
duties under the
statute governing a similar organization in |
another state, shall
be accorded the same priority as
the |
liquidator's expenses. The liquidator shall make prompt |
reimbursement
to the Fund and any similar organization for such |
expense payments.
|
(d) The Fund has the right to recover from the following |
persons the amount
of any covered claims and allocated claims |
expenses which the Fund paid or
incurred on behalf of such |
person in satisfaction, in whole or in part, of
liability |
obligations of such person to any other person:
|
(i) any insured whose net worth on December 31 of the |
year next
preceding the date the company becomes an |
insolvent company exceeds
$25,000,000; provided that an |
insured's net worth on such date shall be deemed
to include |
the aggregate net worth of the insured and all of its |
affiliates
as calculated on a consolidated basis.
|
(ii) any insured who is an affiliate of the insolvent |
company.
|
|
(Source: P.A. 89-206, eff. 7-21-95; 90-499, eff. 8-19-97.)
|
Section 10. The Health Maintenance Organization Act is |
amended by changing Sections 6-4, 6-5, 6-8, 6-9, 6-10, and 6-18 |
as follows:
|
(215 ILCS 125/6-4) (from Ch. 111 1/2, par. 1418.4)
|
Sec. 6-4. Construction. This Article shall be is to be |
liberally construed to
be for the benefit of the member |
organizations' enrollees and to
effect the purpose under |
Section 6-2 which constitutes an aid and guide to
|
interpretation .
|
(Source: P.A. 85-20.)
|
(215 ILCS 125/6-5) (from Ch. 111 1/2, par. 1418.5)
|
Sec. 6-5. Definitions. As used in this Act:
|
(1) "Association" means the Illinois Health Maintenance |
Organization
Guaranty Association created under Section 6-6.
|
(2) "Director" means the Director of Insurance of this |
State.
|
(3) "Contractual obligation" means any obligation of the |
member
organization under covered
health care plan |
certificates.
|
(4) "Covered person" means any enrollee who is entitled to |
the
protection of the Association as described in Section 6-2.
|
(5) "Covered health care plan certificate" means any health |
|
care plan
certificate, contract or other evidence of coverage |
within the scope
of this Article under Section 6-3.
|
(6) "Fund" means the fund created under Section 6-6.
|
(7) "Impaired organization" means a member organization |
deemed by the
Director after the effective date of this Article |
to be potentially unable
to fulfill its contractual obligations |
and not an insolvent organization.
|
(8) "Insolvent organization" means a member organization |
which
becomes insolvent and is placed under a final order of |
liquidation or
rehabilitation by a court of competent |
jurisdiction.
|
(9) "Member organization" means any person licensed or who |
holds a
certificate of authority to transact in this
State any |
kind of business to which this Article applies under
Section |
6-3. For purposes of this Article "member organization" |
includes
any person whose certificate of authority may have |
been suspended pursuant
to Section 5-5 of this Act.
|
(10) "Premiums" means direct gross premiums or |
subscriptions
received on covered health care plan |
certificates. "Premiums" does not include amounts or |
considerations received for policies, contracts, or |
certificates or for the portions of policies, contracts, or |
certificates for which coverage is not provided.
|
(11) "Person" means any individual, corporation, |
partnership,
association or voluntary organization.
|
(12) "Resident" means any person who resides in this State |
|
at the time the
organization is issued a Notice of Impairment |
by the Director or at the time a
complaint for liquidation or |
rehabilitation is filed and to whom
contractual obligations are |
owed. A person may be a resident of only one
state which, in |
the case of a person other than a natural person, shall be
its |
principal place of business.
|
(Source: P.A. 88-297.)
|
(215 ILCS 125/6-8) (from Ch. 111 1/2, par. 1418.8)
|
Sec. 6-8. Powers and duties of the Association. In addition |
to
the powers and duties enumerated in other Sections of this |
Article, the
Association shall have the powers set forth in |
this Section.
|
(1) If a domestic organization is an impaired organization, |
the Association
may, subject to any conditions imposed by the |
Association other than
those which impair the contractual |
obligations of the impaired organization,
and approved by the |
impaired organization and the Director:
|
(a) guarantee , assume, or reinsure, or cause to be |
guaranteed, assumed or
reinsured, any or all of the covered |
health care plan certificates of
covered persons of the |
impaired organization;
|
(b) provide such monies, pledges, notes, guarantees, |
or other means
as are proper to effectuate paragraph (a), |
and assure payment of the
contractual obligations of the |
impaired organization pending action under
paragraph (a); |
|
and
|
(c) loan money to the impaired organization.
|
(2) If a domestic, foreign, or alien organization is an |
insolvent
organization, the Association shall, subject to the |
approval of the Director:
|
(a) guarantee, assume, indemnify or reinsure or cause |
to be guaranteed,
assumed, indemnified or reinsured the |
covered health care plan benefits
of covered persons of the |
insolvent organization; however, in the event
that the |
Director of Healthcare and Family Services (formerly
|
Director of the Department of Public Aid)
assigns |
individuals that are recipients of public aid from an |
insolvent
organization to another organization, the |
Director of Healthcare and Family Services shall, before |
fixing the rates to be paid by the Department of
Healthcare |
and Family Services
to the transferee organization on |
account of such individuals,
consult with the Director of |
the Department of Insurance as to the
reasonableness of |
such rates in light of the health care needs of such
|
individuals and the costs of providing health care services |
to such
individuals;
|
(b) assure payment of the contractual obligations of |
the insolvent
organization to covered persons;
|
(c) make payments to providers of health care, or |
indemnity payments
to covered persons, so as to assure the |
continued payment of benefits
substantially similar to |
|
those provided for under covered health care plan
|
certificate issued by the insolvent organization to |
covered persons; and
|
(d) provide such monies, pledges, notes, guaranties, |
or other means
as are reasonably necessary to discharge |
such duties.
|
This subsection (2) shall not apply when the
Director has |
determined that the foreign or alien organization's
|
domiciliary jurisdiction or state of entry provides, by |
statute, protection
substantially similar to that provided by |
this Article for residents of
this State and such protection |
will be provided in a timely manner.
|
(3) There shall be no liability on the part of and no cause |
of action
shall arise against the Association or against any |
transferee from the
Association in connection with the transfer |
by reinsurance or otherwise of
all or any part of an impaired |
or insolvent organization's business by
reason of any action |
taken or any failure to take any action by the
impaired or |
insolvent organization at any time.
|
(4) If the Association fails to act within a reasonable |
period of
time as provided in subsection (2) of this Section |
with respect to an
insolvent organization, the Director shall |
have the powers and duties of
the Association under this |
Article with regard to such insolvent organization.
|
(5) The Association or its designated representatives may |
render
assistance and advice to the Director, upon his request, |
|
concerning
rehabilitation, payment of claims, continuations of |
coverage, or the
performance of other contractual obligations |
of any impaired or insolvent
organization.
|
(6) The Association has standing to appear before any court |
concerning
all matters germane to the powers and duties of
the |
Association, including, but not limited to, proposals for |
reinsuring
or guaranteeing the covered health care plan |
certificates of the impaired
or insolvent organization and the |
determination of the covered health care plan
certificates and |
contractual obligations.
|
(7) (a) Any person receiving benefits under this Article is |
deemed
to have assigned the rights under the covered health |
care plan
certificates to the Association to the extent of the |
benefits received
because of this Article whether the benefits |
are payments of contractual
obligations or continuation of |
coverage. The Association may require an
assignment to it of |
such rights by any payee, enrollee or beneficiary as a
|
condition precedent to the receipt of any rights or benefits |
conferred by
this Article upon such person. The Association is |
subrogated to these
rights against the assets of any insolvent |
organization and against any
other party who may be liable to |
such payee, enrollee or beneficiary.
|
(b) The subrogation rights of the Association under this |
subsection
have the same priority against the assets of the |
insolvent organization as
that possessed by the person entitled |
to receive benefits under this
Article.
|
|
(8) (a) The contractual obligations of the insolvent |
organization for
which the Association becomes or may become |
liable are as great as but no
greater than the contractual |
obligations of the insolvent organization would
have been in |
the absence of an insolvency unless such obligations are
|
reduced as permitted by subsection (3), but the aggregate |
liability of the
Association shall not exceed $300,000 with |
respect to any one natural person.
|
(b) Furthermore, the Association shall not be required to |
pay, and shall
have no liability to, any provider of health |
care services to an enrollee:
|
(i) if such provider, or his or its affiliates or |
members of his
immediate family, at any time within the one |
year prior to the date of the
issuance of the first order, |
by a court of competent jurisdiction, of
conservation, |
rehabilitation or liquidation pertaining to the health
|
maintenance organization:
|
(A) was a securityholder of such organization (but |
excluding any
securityholder holding an equity |
interest of 5% or less);
|
(B) exercised control over the organization by |
means such as serving as
an officer or director, |
through a management agreement or as a principal
member |
of a not-for-profit organization;
|
(C) had a representative serving by virtue or his |
or her official
position as a representative of such |
|
provider on the board of any entity
which exercised |
control over the organization;
|
(D) received provider payments made by such |
organization pursuant to a
contract which was not a |
product of arms-length bargaining; or
|
(E) received distributions other than for |
physician services from a
not-for-profit organization |
on account of such provider's status as a
member of |
such organization.
|
For purposes of this subparagraph (i), the terms |
"affiliate," "person,"
"control" and "securityholder" |
shall have the meanings ascribed to such
terms in Section |
131.1 of the Illinois Insurance Code; or
|
(ii) if and to the extent such a provider has agreed by |
contract not
to seek payment from the enrollee for services |
provided to such enrollee
or if, and to the extent, as a |
matter of law such provider may not seek
payment from the |
enrollee for services provided to such enrollee.
|
(iii) related to any policy, contract, or certificate |
providing any hospital, medical, prescription drug, or |
other health care benefits pursuant to Part C or Part D of |
Subchapter XVIII, Chapter 7 of Title 42 of the United |
States Code (commonly known as Medicare Part C & D) or any |
regulations issued pursuant thereto; or |
(iv) for any portion of a policy, contract, or |
certificate to the extent that the assessments required by |
|
this Article with respect to the policy or contract are |
preempted or otherwise not permitted by federal or State |
law; or |
(v) for any obligation that does not arise under the |
express written terms of the policy or contract issued by |
the organization to the contract owner or policy owner, |
including without limitation: |
(A) claims based on marketing materials; |
(B) claims based on side letters, riders, or other |
documents that were issued by the insurer without |
meeting applicable policy form filing or approval |
requirements; |
(C) misrepresentations of or regarding policy |
benefits; |
(D) extra-contractual claims; or |
(E) claims for penalties or consequential or |
incidental damages. |
(c) In no event shall the Association be required to pay |
any provider
participating in the insolvent organization
any |
amount for in-plan services rendered by such provider prior to |
the
insolvency of the organization in excess of (1) the amount
|
provided by a capitation contract between a physician provider |
and the
insolvent organization for such services; or (2) the
|
amounts provided by contract between a hospital provider and |
the Department of Healthcare and Family Services (formerly
|
Department of
Public Aid) for similar services to recipients of |
|
public aid; or (3) in the
event neither (1) nor (2) above is |
applicable, then the amounts paid under
the Medicare area |
prevailing rate for the area where the services were
provided, |
or if no such rate exists with respect to such services, then |
80%
of the usual and customary rates established by the Health |
Insurance
Association of America. The payments required to be |
made by the Association
under this Section shall constitute |
full and complete payment for such
provider services to the |
enrollee.
|
(d) The Association shall not be required to pay more than |
an
aggregate of $300,000 for any organization which is declared |
to be
insolvent prior to July 1, 1987, and such funds shall be |
distributed first
to enrollees who are not public aid |
recipients pursuant to a plan
recommended by the Association |
and approved by the Director and the court
having jurisdiction |
over the liquidation.
|
(9) The Association may:
|
(a) Enter into such contracts as are necessary or |
proper to carry
out the provisions and purposes of this |
Article.
|
(b) Sue or be sued, including taking any legal actions |
necessary or
proper for recovery of any unpaid assessments |
under Section 6-9. The
Association shall not be liable for |
punitive or exemplary damages.
|
(c) Borrow money to effect the purposes of this |
Article. Any notes
or other evidence of indebtedness of the |
|
Association not in default are
legal investments for |
domestic organizations and may be carried as admitted
|
assets.
|
(d) Employ or retain such persons as are necessary to |
handle the
financial transactions of the Association, and |
to perform such other
functions as become necessary or |
proper under this Article.
|
(e) Negotiate and contract with any liquidator, |
rehabilitator,
conservator, or ancillary receiver to carry |
out the powers and duties of
the Association.
|
(f) Take such legal action as may be necessary to avoid |
payment of
improper claims.
|
(g) Exercise, for the purposes of this Article and to |
the extent
approved by the Director, the powers of a |
domestic
organization, but in no case may the Association |
issue evidence of coverage
other than that issued to |
perform the contractual
obligations of the impaired or |
insolvent organization.
|
(h) Exercise all the rights of the Director under |
Section 193(4) of
the Illinois Insurance Code with respect |
to covered health care plan
certificates after the |
association becomes obligated by statute.
|
(i) Request information from a person seeking coverage |
from the Association in order to aid the Association in |
determining its obligations under this Article with |
respect to the person and the person shall promptly comply |
|
with the request. |
(j) Take other necessary or appropriate action to |
discharge its duties and obligations under this Article or |
to exercise its powers under this Article. |
(10) The obligations of the Association under this Article |
shall not
relieve any reinsurer, insurer or other person of its |
obligations to the
insolvent organization (or its conservator, |
rehabilitator, liquidator or
similar official) or its |
enrollees, including without limitation any
reinsurer, insurer |
or other person liable to the insolvent insurer (or its
|
conservator, rehabilitator, liquidator or similar official) or |
its
enrollees under any contract of reinsurance, any contract |
providing stop
loss coverage or similar coverage or any health |
care contract. With
respect to covered health care plan |
certificates for which the
Association becomes obligated after |
an entry of an order of liquidation
or rehabilitation, the |
Association may elect to succeed to the rights of
the insolvent |
organization arising after the date of the order of
liquidation |
or rehabilitation under any contract of reinsurance, any
|
contract providing stop loss coverage or similar coverages or |
any health
care service contract to which the insolvent |
organization was a party, on
the terms set forth under such |
contract, to the extent that such contract
provides coverage |
for health care services provided after the date of the
order |
of liquidation or rehabilitation. As a condition to making this
|
election, the Association must pay premiums for coverage |
|
relating to
periods after the date of the order of liquidation |
or rehabilitation.
|
(11) The Association shall be entitled to collect premiums |
due under or with
respect to covered health care certificates |
for a period from the date on which
the domestic, foreign, or |
alien organization became an insolvent organization
until the |
Association no longer has obligations under subsection (2) of
|
this Section with respect to such certificates. The |
Association's
obligations under subsection (2) of this Section |
with respect to
any covered health care plan certificates shall |
terminate in the event that
all such premiums due under or with |
respect to such covered health care plan
certificates are not |
paid to the Association (i) within 30 days of the
Association's |
demand therefor, or (ii) in the event that such certificates
|
provide for a longer grace period for payment of premiums after |
notice of
non-payment or demand therefor, within the lesser of |
(A) the period provided
for in such certificates or (B) 60 |
days.
|
(12) The Board of Directors of the Association shall have |
discretion and may exercise reasonable business judgment to |
determine the means by which the Association is to provide the |
benefits of this Article in an economical and efficient manner. |
(13) Where the Association has arranged or offered to |
provide the benefits of this Article to a covered person under |
a plan or arrangement that fulfills the Association's |
obligations under this Article, the person shall not be |
|
entitled to benefits from the Association in addition to or |
other than those provided under the plan or arrangement. |
(14) Venue in a suit against the Association arising under |
the Article shall be in Cook County. The Association shall not |
be required to give any appeal bond in an appeal that relates |
to a cause of action arising under this Article. |
(Source: P.A. 95-331, eff. 8-21-07.)
|
(215 ILCS 125/6-9) (from Ch. 111 1/2, par. 1418.9)
|
Sec. 6-9. Assessments. (1) For the purpose of providing the |
funds
necessary to carry out the powers and duties of the |
Association, the board
of directors shall assess the member |
organizations, at such
times and for such amounts as the board |
finds necessary. Assessments shall
be due not less than 30 days |
after written notice to the member organizations
and shall |
accrue interest from the due date at such adjusted rate as is
|
established under Section 531.09 of the Illinois Insurance Code |
and
such interest shall be compounded daily.
|
(2) There shall be 2 classes of assessments, as follows:
|
(a) Class A assessments shall be made for the purpose of |
meeting
administrative costs and other general expenses and |
examinations conducted
under the authority of the Director |
under subsection (5) of Section 6-12.
|
(b) Class B assessments shall be made to the extent |
necessary to carry
out the powers and duties of the Association |
under Section 6-8 with regard
to an impaired or insolvent |
|
domestic organization or insolvent foreign or
alien |
organizations.
|
(3) (a) The amount of any Class A assessment shall be |
determined by the
Board and may be made on a non-pro rata |
basis.
|
(b) Class B assessments against member organizations shall
|
be in the proportion that the premiums received on health |
maintenance
organization business in this State
by each |
assessed member organization on covered health care plan |
certificates for
the calendar year preceding the assessment |
bears to such premiums received
on health maintenance |
organization business in this State for the calendar
year |
preceding the assessment by all assessed member organizations.
|
(c) Assessments to meet the requirements of the Association
|
with respect to an impaired or insolvent organization shall not |
be made until
necessary to implement the purposes of this |
Article. Classification
of assessments under subsection (2) |
and computations of assessments under
this subsection shall be |
made with a reasonable degree of accuracy,
recognizing that |
exact determinations may not always be possible.
|
(4) (a) The Association may abate or defer, in whole or in |
part, the
assessment of a member organization if, in the |
opinion of the board,
payment of the assessment would endanger |
the ability of the member
organization to fulfill its |
contractual obligations.
|
(b) The total of all assessments upon a member organization
|
|
may not in any one calendar year exceed 2% of such |
organization's premiums
in this State during the calendar year |
preceding the assessment on the
covered health care plan |
certificates.
|
(5) In the event an assessment against a member |
organization is abated,
or deferred, in whole or in part, |
because of the limitations set forth in
subsection (4) of this |
Section, the amount by which such assessment is
abated or |
deferred, may be assessed against the other member |
organizations
in a manner consistent with the basis for |
assessments set forth in this
Section. If the maximum |
assessment, together with the other assets of the
Association, |
does not provide in any one year an amount sufficient to carry
|
out the responsibilities of the Association, the necessary |
additional funds
may be assessed as soon thereafter as |
permitted by this Article.
|
(6) The board may, by an equitable method as established in |
the
plan of operation, refund to member organizations, in |
proportion to the
contribution of each organization, the amount |
by which the assets of the fund
exceed the amount the board |
finds is necessary to carry out during the coming
year the |
obligations of the Association, including
assets accruing from |
net realized gains and income from investments. A
reasonable |
amount may be retained in the fund to provide moneys for the
|
continuing expenses of the Association and for future losses if |
refunds are
impractical .
|
|
(7) An assessment is deemed to occur on the date upon which |
the board
votes such assessment. The board may defer calling |
the payment of the
assessment or may call for payment in one or |
more installments.
|
(8) It is proper for any member organization, in |
determining its rates
to consider the amount reasonably |
necessary to meet its assessment
obligations under this |
Article.
|
(9) The Association must issue to each organization paying |
a
Class B assessment under this Article a certificate of |
contribution,
in a form prescribed by the Director, for the |
amount of the assessment so
paid. All outstanding certificates |
are of equal dignity and priority
without reference to amounts |
or dates of issue. A certificate of
contribution may be shown |
by the organization in its financial statement as
an admitted |
asset in such form and for such amount, if any, and period of
|
time as the Director may approve, provided the organization |
shall in any
event at its option have the right to show a |
certificate of contribution as
an asset at percentages of the |
original face amount for calendar years as follows:
|
100% for the calendar year after the year of issuance;
|
80% for the second calendar year after the year of |
issuance;
|
60% for the third calendar year after the year of issuance;
|
40% for the fourth calendar year after the year of |
issuance;
|
|
20% for the fifth calendar year after the year of issuance.
|
(10) The Association may request information of member |
organizations in order to aid in the exercise of its power |
under this Section and member organizations shall promptly |
comply with a request. |
(Source: P.A. 85-20.)
|
(215 ILCS 125/6-10) (from Ch. 111 1/2, par. 1418.10)
|
Sec. 6-10. Plan of Operation. (1) (a) The Association must
|
submit to the Director a plan of operation and any amendments |
thereto necessary
or suitable to assure the fair, reasonable, |
and equitable administration of the
Association. The plan of |
operation and any amendments thereto become effective
upon |
approval in writing by the Director.
|
(b) If the Association fails to submit a suitable plan of |
operation
within 90 days following the effective date of this |
Article or if at any time
thereafter the Association fails to |
submit suitable amendments to the plan, the
Director may, after |
notice and hearing, adopt and promulgate such reasonable
rules |
as are necessary or advisable to effectuate the provisions of |
this
Article. Such rules are in force until modified by the |
Director or
superseded by a plan submitted by the Association |
and approved by the Director.
|
(2) All member organizations must comply with the plan of |
operation.
|
(3) The plan of operation must, in addition to requirements |
|
enumerated
elsewhere in this Article:
|
(a) Establish procedures for handling the assets of the |
Association;
|
(b) Establish the amount and method of reimbursing members |
of the
board of directors under Section 6-7;
|
(c) Establish regular places and times for meetings of the |
board
of directors;
|
(d) Establish procedures for records to be kept of all |
financial
transactions of the Association, its agents, and the |
board of directors;
|
(e) Establish the procedures whereby selections for the |
board
of directors will be made and submitted to the Director;
|
(f) Establish any additional procedures for assessments |
under
Section 6-9; and
|
(g) Contain additional provisions necessary or proper for |
the execution
of the powers and duties of the Association.
|
(4) The plan of operation shall establish a procedure for |
protest by
any member organization of assessments made by the |
Association pursuant to
Section 6-9. Such procedures shall |
require that:
|
(a) A member organization that wishes to protest all or |
part of an assessment shall pay when due the full amount of the |
assessment as set forth in the notice provided by the |
Association. The payment shall be available to meet Association |
obligations during the pendency of the protest or any |
subsequent appeal. Payment shall be accompanied by a statement |
|
in writing that the payment is made under protest and setting |
forth a brief statement of the grounds for the protest. Any |
member organization that wishes to protest all or any part of |
an
assessment for any year shall first pay the full amount of |
the assessment
as set forth in the notice provided by the |
Association. Such payments
shall be accompanied by a statement |
in writing that the payment is made
under protest, setting |
forth a brief statement of the ground for the
protest. The |
Association shall hold such payments in a separate interest
|
bearing account.
|
(b) Within 30 days following the payment of an assessment |
under
protest by any protesting member organization, the |
Association must notify the
member organization in writing of |
its determination with respect to the protest
unless the |
Association notifies the member that additional time is |
required
to resolve the issues raised by the protest.
|
(c) In the event the Association determines that the |
protesting member
organization is entitled to a refund, such |
refund shall be made within 30
days following the date upon |
which the Association makes its determination.
|
(d) The decision of the Association with respect to a |
protest may be
appealed to the Director pursuant to subsection |
(3) of Section 6-11.
|
(e) In the alternative to rendering a decision with respect |
to any
protest based on a question regarding the assessment |
base, the Association
may refer such protests to the Director |
|
for final decision, with or without
a recommendation from the |
Association.
|
(f) Interest on any refund due a protesting member |
organization shall be
paid at the rate actually earned by the |
Association on the separate account .
|
(5) The plan of operation may provide that any or all |
powers and duties
of the Association, except those under |
paragraph (c) of subsection (10)
of Section 6-8 and Section 6-9 |
are delegated to a corporation, association
or other |
organization which performs or will perform functions similar |
to
those of this Association, or its equivalent, in 2 or more |
states. Such
a corporation, association or organization shall |
be reimbursed for any payments
made on behalf of the |
Association and shall be paid for its performance
of any |
function of the Association. A delegation under this subsection
|
shall take effect only with the approval of both the Board of |
Directors
and the Director, and may be made only to a |
corporation, association or
organization which extends |
protection not substantially
less favorable and effective than |
that provided by this Article.
|
(Source: P.A. 85-20.)
|
(215 ILCS 125/6-18) (from Ch. 111 1/2, par. 1418.18)
|
Sec. 6-18. Stay of Proceedings - Reopening Default |
Judgments. All proceedings in which the insolvent organization |
is a party in any court
in this State shall be stayed 180 60 |
|
days from the date an order of
liquidation, rehabilitation, or |
conservation is final to permit proper
legal action by the |
Association on any matters germane to its powers or
duties. As |
to a judgment under any decision, order, verdict, or finding
|
based on default the Association may apply to have such |
judgment set aside
by the same court that made such judgment |
and must be permitted to defend
against such suit on the |
merits.
|
(Source: P.A. 85-20.)
|
Section 99. Effective date. This Act takes effect upon |
becoming law.
|
|
INDEX
|
Statutes amended in order of appearance
| | 215 ILCS 5/187 | from Ch. 73, par. 799 | | 215 ILCS 5/206.1 new | | | 215 ILCS 5/209 | from Ch. 73, par. 821 | | 215 ILCS 5/531.03 | from Ch. 73, par. 1065.80-3 | | 215 ILCS 5/531.04 | from Ch. 73, par. 1065.80-4 | | 215 ILCS 5/531.05 | from Ch. 73, par. 1065.80-5 | | 215 ILCS 5/531.06 | from Ch. 73, par. 1065.80-6 | | 215 ILCS 5/531.07 | from Ch. 73, par. 1065.80-7 | | 215 ILCS 5/531.08 | from Ch. 73, par. 1065.80-8 | | 215 ILCS 5/531.09 | from Ch. 73, par. 1065.80-9 | | 215 ILCS 5/531.10 | from Ch. 73, par. 1065.80-10 | | 215 ILCS 5/531.11 | from Ch. 73, par. 1065.80-11 | | 215 ILCS 5/531.12 | from Ch. 73, par. 1065.80-12 | | 215 ILCS 5/531.14 | from Ch. 73, par. 1065.80-14 | | 215 ILCS 5/531.17 | from Ch. 73, par. 1065.80-17 | | 215 ILCS 5/531.18 | from Ch. 73, par. 1065.80-18 | | 215 ILCS 5/537.2 | from Ch. 73, par. 1065.87-2 | | 215 ILCS 5/545 | from Ch. 73, par. 1065.95 | | 215 ILCS 125/6-4 | from Ch. 111 1/2, par. 1418.4 | | 215 ILCS 125/6-5 | from Ch. 111 1/2, par. 1418.5 | | 215 ILCS 125/6-8 | from Ch. 111 1/2, par. 1418.8 | | 215 ILCS 125/6-9 | from Ch. 111 1/2, par. 1418.9 | | 215 ILCS 125/6-10 | from Ch. 111 1/2, par. 1418.10 | |
| 215 ILCS 125/6-17 | from Ch. 111 1/2, par. 1418.17 | | 215 ILCS 125/6-18 | from Ch. 111 1/2, par. 1418.18 |
|
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