Public Act 93-0218

SB741 Enrolled                       LRB093 03236 JLS 03253 b

    AN ACT relating to insurance.

    Be it enacted by the People of  the  State  of  Illinois,
represented in the General Assembly:

    Section  5.  The  Illinois  Insurance  Code is amended by
adding Section 155.39 as follows:

    (215 ILCS 5/155.39 new)
    Sec. 155.39.  Vehicle protection products.
    (a)  As used in this Section:
    "Administrator"  means  a  third  party  other  than  the
warrantor  who  is  designated  by  the   warrantor   to   be
responsible  for  the  administration  of  vehicle protection
product warranties.
    "Incidental  costs"  means  expenses  specified  in   the
vehicle  protection product warranty incurred by the warranty
holder related to  the  failure  of  the  vehicle  protection
product  to  perform  as provided in the warranty. Incidental
costs  may  include,  without  limitation,  insurance  policy
deductibles, rental vehicle charges, the  difference  between
the  actual  value of the stolen vehicle at the time of theft
and  the  cost  of  a  replacement  vehicle,   sales   taxes,
registration   fees,   transaction   fees,   and   mechanical
inspection fees.
    "Vehicle  protection  product" means a vehicle protection
device, system, or  service  that  is  (i)  installed  on  or
applied  to  a  vehicle,  (ii) is designed to prevent loss or
damage to a vehicle from a specific cause, (iii)  includes  a
written  warranty by a warrantor that provides if the vehicle
protection product fails to  prevent  loss  or  damage  to  a
vehicle from a specific cause, that the warranty holder shall
be  paid  specified  incidental  costs  by the warrantor as a
result of the failure of the vehicle  protection  product  to
perform  pursuant  to the terms of the warranty, and (iv) the
warrantor's liability is covered by a warranty  reimbursement
insurance policy. The term "vehicle protection product" shall
include, without limitation, alarm systems, body part marking
products,  steering  locks,  window  etch products, pedal and
ignition  locks,  fuel  and  ignition  kill   switches,   and
electronic, radio, and satellite tracking devices.
    "Vehicle  protection  product  warrantor"  or "warrantor"
means a person who is contractually obligated to the warranty
holder under the terms of  the  vehicle  protection  product.
Warrantor does not include an authorized insurer.
    "Warranty  reimbursement insurance policy" means a policy
of  insurance  issued  to  the  vehicle  protection   product
warrantor  to  pay  on  behalf  of  the warrantor all covered
contractual obligations incurred by the warrantor  under  the
terms  and  conditions  of  the  insured  vehicle  protection
product  warranties  sold  by  the  warrantor.   The warranty
reimbursement insurance policy shall be issued by an  insurer
authorized  to  do  business in this State that has filed its
policy form with the Department.
    (b)  No vehicle protection product sold  or  offered  for
sale in this State shall be subject to the provisions of this
Code.     Vehicle  protection  product warrantors and related
vehicle   protection    product    sellers    and    warranty
administrators  complying  with this Section are not required
to comply with and are not subject to any other provision  of
this   Code.    The   vehicle  protection  products'  written
warranties are express warranties and not insurance.
    (c)  This  Section  applies  to  all  vehicle  protection
products sold or offered for sale prior to, on, or after  the
effective  date  of  this  amendatory Act of the 93rd General
Assembly. The enactment of this Section does not  imply  that
vehicle  protection  products  should  have  been  subject to
regulation under this Code prior to  the  enactment  of  this
Section.

    Section  99.  Effective  date. This Act takes effect upon
becoming law.