100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5583

 

Introduced , by Rep. Norine K. Hammond

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/143  from Ch. 73, par. 755

    Amends the Illinois Insurance Code. In provisions concerning an application blank in a life or accident and health policy form, removes language allowing the Director of Insurance to extend the period to approve or disapprove a form by not more than 30 days. Provides that an insurer may request by electronic notification that the extension end on a specified date, but no sooner than 30 days after the request. Makes other changes.


LRB100 18937 SMS 34187 b

 

 

A BILL FOR

 

HB5583LRB100 18937 SMS 34187 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Insurance Code is amended by
5changing Section 143 as follows:
 
6    (215 ILCS 5/143)  (from Ch. 73, par. 755)
7    Sec. 143. Policy forms.
8    (1) Life, accident and health. No company transacting the
9kind or kinds of business enumerated in Classes 1 (a), 1 (b)
10and 2 (a) of Section 4 shall issue or deliver in this State a
11policy or certificate of insurance or evidence of coverage,
12attach an endorsement or rider thereto, incorporate by
13reference bylaws or other matter therein or use an application
14blank in this State until the form and content of such policy,
15certificate, evidence of coverage, endorsement, rider, bylaw
16or other matter incorporated by reference or application blank
17has been filed electronically with the Director, either through
18the System for Electronic Rate and Form Filing (SERFF) or as
19otherwise prescribed by the Director, and approved by the
20Director. Any such endorsement or rider that unilaterally
21reduces benefits and is to be attached to a policy subsequent
22to the date the policy is issued must be filed with, reviewed,
23and formally approved by the Director prior to the date it is

 

 

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1attached to a policy issued or delivered in this State. It
2shall be the duty of the Director to withhold approval of any
3such policy, certificate, endorsement, rider, bylaw or other
4matter incorporated by reference or application blank filed
5with him if it contains provisions which encourage
6misrepresentation or are unjust, unfair, inequitable,
7ambiguous, misleading, inconsistent, deceptive, contrary to
8law or to the public policy of this State, or contains
9exceptions and conditions that unreasonably or deceptively
10affect the risk purported to be assumed in the general coverage
11of the policy. In all cases the Director shall approve or
12disapprove any such form within 60 days after submission unless
13the Director extends by not more than an additional 30 days the
14period within which he or she shall approve or disapprove any
15such form by giving written notice to the insurer of such
16extension before expiration of the initial 60-day 60 days
17period. At any time after the expiration of the initial 60-day
18period, the insurer may send an electronic notification to the
19Director requesting that the extension end on a specified date,
20except that the requested end date shall be no sooner than 30
21days after the insurer's electronic notification to the
22Director requesting that the extension end. The Director shall
23approve or disapprove any form within the time frame requested
24by the insurer, provided it is no sooner than 30 days after the
25insurer's electronic notification to the Director requesting
26that the extension end. The Director shall withdraw his

 

 

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1approval of a policy, certificate, evidence of coverage,
2endorsement, rider, bylaw, or other matter incorporated by
3reference or application blank if he subsequently determines
4that such policy, certificate, evidence of coverage,
5endorsement, rider, bylaw, other matter, or application blank
6is misrepresentative, unjust, unfair, inequitable, ambiguous,
7misleading, inconsistent, deceptive, contrary to law or public
8policy of this State, or contains exceptions or conditions
9which unreasonably or deceptively affect the risk purported to
10be assumed in the general coverage of the policy or evidence of
11coverage.
12    If a previously approved policy, certificate, evidence of
13coverage, endorsement, rider, bylaw or other matter
14incorporated by reference or application blank is withdrawn for
15use, the Director shall serve upon the company an order of
16withdrawal of use, either personally or by mail, and if by
17mail, such service shall be completed if such notice be
18deposited in the post office, postage prepaid, addressed to the
19company's last known address specified in the records of the
20Department of Insurance. The order of withdrawal of use shall
21take effect 30 days from the date of mailing but shall be
22stayed if within the 30-day period a written request for
23hearing is filed with the Director. Such hearing shall be held
24at such time and place as designated in the order given by the
25Director. The hearing may be held either in the City of
26Springfield, the City of Chicago or in the county where the

 

 

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1principal business address of the company is located. The
2action of the Director in disapproving or withdrawing such form
3shall be subject to judicial review under the Administrative
4Review Law.
5    This subsection shall not apply to riders or endorsements
6issued or made at the request of the individual policyholder
7relating to the manner of distribution of benefits or to the
8reservation of rights and benefits under his life insurance
9policy.
10    (2) Casualty, fire, and marine. The Director shall require
11the filing of all policy forms issued or delivered by any
12company transacting the kind or kinds of business enumerated in
13Classes 2 (except Class 2 (a)) and 3 of Section 4 in an
14electronic format either through the System for Electronic Rate
15and Form Filing (SERFF) or as otherwise prescribed and approved
16by the Director. In addition, he may require the filing of any
17generally used riders, endorsements, certificates, application
18blanks, and other matter incorporated by reference in any such
19policy or contract of insurance. Companies that are members of
20an organization, bureau, or association may have the same filed
21for them by the organization, bureau, or association. If the
22Director shall find from an examination of any such policy
23form, rider, endorsement, certificate, application blank, or
24other matter incorporated by reference in any such policy so
25filed that it (i) violates any provision of this Code, (ii)
26contains inconsistent, ambiguous, or misleading clauses, or

 

 

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1(iii) contains exceptions and conditions that will
2unreasonably or deceptively affect the risks that are purported
3to be assumed by the policy, he shall order the company or
4companies issuing these forms to discontinue their use. Nothing
5in this subsection shall require a company transacting the kind
6or kinds of business enumerated in Classes 2 (except Class 2
7(a)) and 3 of Section 4 to obtain approval of these forms
8before they are issued nor in any way affect the legality of
9any policy that has been issued and found to be in conflict
10with this subsection, but such policies shall be subject to the
11provisions of Section 442.
12    (3) This Section shall not apply (i) to surety contracts or
13fidelity bonds, (ii) to policies issued to an industrial
14insured as defined in Section 121-2.08 except for workers'
15compensation policies, nor (iii) to riders or endorsements
16prepared to meet special, unusual, peculiar, or extraordinary
17conditions applying to an individual risk.
18(Source: P.A. 97-486, eff. 1-1-12; 98-226, eff. 1-1-14.)