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1 | | AN ACT concerning regulation.
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2 | | Be it enacted by the People of the State of Illinois,
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3 | | represented in the General Assembly:
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4 | | Section 5. The Illinois Insurance Code is amended by |
5 | | changing Section 154.6 and by adding Section 154.9 as follows:
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6 | | (215 ILCS 5/154.6) (from Ch. 73, par. 766.6)
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7 | | Sec. 154.6. Acts constituting improper claims practice. |
8 | | Any of the
following acts by a company, if committed without |
9 | | just cause and in
violation of Section 154.5, constitutes an |
10 | | improper claims practice:
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11 | | (a) Knowingly misrepresenting to claimants and insureds |
12 | | relevant
facts or policy provisions relating to coverages at |
13 | | issue;
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14 | | (b) Failing to acknowledge with reasonable promptness |
15 | | pertinent
communications with respect to claims arising under |
16 | | its policies;
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17 | | (c) Failing to adopt and implement reasonable standards |
18 | | for the
prompt investigations and settlement of claims arising |
19 | | under its policies;
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20 | | (d) Not attempting in good faith to effectuate prompt, |
21 | | fair and
equitable settlement of claims submitted in which |
22 | | liability has become
reasonably clear;
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23 | | (e) Compelling policyholders to institute suits to recover |
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1 | | amounts
due under its policies by offering substantially less |
2 | | than the amounts
ultimately recovered in suits brought by |
3 | | them;
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4 | | (f) Engaging in activity which results in a |
5 | | disproportionate number
of meritorious complaints against the |
6 | | insurer received by the Insurance
Department;
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7 | | (g) Engaging in activity which results in a |
8 | | disproportionate number
of lawsuits to be filed against the |
9 | | insurer or its insureds by
claimants;
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10 | | (h) Refusing to pay claims without conducting a reasonable
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11 | | investigation based on all available information;
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12 | | (i) Failing to affirm or deny coverage of claims within a |
13 | | reasonable
time after proof of loss statements have been |
14 | | completed;
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15 | | (j) Attempting to settle a claim for less than the amount |
16 | | to which a
reasonable person would believe the claimant was |
17 | | entitled, by reference
to written or printed advertising |
18 | | material accompanying or made part of
an application or |
19 | | establishing unreasonable caps or limits on paint
or materials
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20 | | when estimating vehicle repairs;
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21 | | (k) Attempting to settle claims on the basis of an |
22 | | application which
was altered without notice to, or knowledge |
23 | | or consent of, the insured;
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24 | | (l) Making a claims payment to a policyholder or |
25 | | beneficiary
omitting the coverage under which each payment is |
26 | | being made;
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1 | | (m) Delaying the investigation or payment of claims by |
2 | | requiring an
insured, a claimant, or the physicians of either |
3 | | to submit a preliminary
claim report and then requiring |
4 | | subsequent submission of formal proof of
loss forms, resulting |
5 | | in the duplication of verification;
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6 | | (n) Failing in the case of the denial of a claim or the |
7 | | offer of a
compromise settlement to promptly provide a |
8 | | reasonable and accurate
explanation of the basis in the |
9 | | insurance policy or applicable law for
such denial or |
10 | | compromise settlement;
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11 | | (o) Failing to provide forms necessary to present claims |
12 | | within 15
working days of a request with such explanations as |
13 | | are necessary to use
them effectively;
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14 | | (p) Failing to adopt and implement reasonable standards to |
15 | | verify that
a repairer designated by the insurance company to |
16 | | provide an estimate,
perform repairs, or engage in any other |
17 | | service in connection with an
insured loss on a vehicle is duly |
18 | | licensed under Section 5-301 of the
Illinois Vehicle Code;
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19 | | (q) Failing to provide as a persistent tendency a |
20 | | notification on any
written estimate prepared by an insurance |
21 | | company in connection with an
insured loss that Illinois law |
22 | | requires that vehicle repairers must be
licensed in accordance |
23 | | with Section 5-301 of the Illinois Vehicle Code;
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24 | | (r) Failing to pay the replacement vehicle use or |
25 | | occupation tax, title, and transfer fees required by Section |
26 | | 154.9 of this Code; |
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1 | | (s) (r) Engaging in any other acts which are in substance |
2 | | equivalent to
any of the foregoing.
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3 | | (Source: P.A. 90-340, eff. 8-8-97.)
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4 | | (215 ILCS 5/154.9 new) |
5 | | Sec. 154.9. Payment of applicable use or occupation tax, |
6 | | title, and transfer fees on a private passenger total loss |
7 | | claim. |
8 | | (a) When an insurer determines that an insured's or |
9 | | third-party claimant's private passenger automobile is a total |
10 | | loss that is covered under the terms of a personal automobile |
11 | | policy issued or renewed on or after July 1, 2022 by the |
12 | | insurer, the insurer shall pay any use or occupation tax |
13 | | imposed by the State or a unit of local government and title |
14 | | and transfer fees as provided for in this Section. As used in |
15 | | this Section, "private passenger vehicle" means a private |
16 | | passenger motor vehicle, station wagon, or any other 4-wheeled |
17 | | motor vehicle with a load capacity of 1,500 pounds or less that |
18 | | is not used in the occupation, profession, or business of the |
19 | | insured or third-party claimant, not used as a public or |
20 | | livery conveyance for passengers, nor rented to others. |
21 | | (b) If the insurer elects to replace the insured vehicle, |
22 | | the insurer shall pay any use or occupation tax imposed by the |
23 | | State or a unit of local government tax and title and transfer |
24 | | fees on the replacement vehicle. |
25 | | (c) If a cash settlement is provided for the total loss |
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1 | | private passenger vehicle, the insurer shall reimburse the |
2 | | insured or third-party claimant for any use or occupation tax |
3 | | imposed by the State or a unit of local government and title |
4 | | and transfer fees if the replacement vehicle is purchased or |
5 | | leased within 30 days after the receipt of the cash settlement |
6 | | by the insured or third-party claimant and the insured or |
7 | | third-party claimant substantiates such purchase and the |
8 | | payment of such taxes and fees by submission of appropriate |
9 | | documentation to the insurer within 33 days after the receipt |
10 | | of the settlement or receipt of the required reimbursement |
11 | | form from the insurer, whichever is later. |
12 | | (1) With respect to leased vehicles, use or occupation |
13 | | taxes and title and transfer fees shall be deemed to be |
14 | | incurred by the insured or the third-party claimant at the |
15 | | time the lease is entered into, but only if such use or |
16 | | occupation taxes and title and transfer fees are included |
17 | | in the cost of the lease or are paid directly by the |
18 | | insured or third-party claimant. |
19 | | (2) The insurer is not required to reimburse the |
20 | | insured or third-party claimant for any use or occupation |
21 | | taxes and title or transfer fees in excess of the amount |
22 | | payable based on the value of the total loss vehicle at the |
23 | | time of the loss or for taxes and title or transfer fees |
24 | | not actually paid by the insured or third-party claimant. |
25 | | (3) In lieu of this reimbursement procedure, the |
26 | | insurer may directly pay the required amount of any use or |
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1 | | occupation taxes and title and transfer fees to the |
2 | | claimant at the time of settlement. |
3 | | (4) If an insurer requires a particular form be used |
4 | | to apply for reimbursement of any use or occupation taxes |
5 | | and title or transfer fees, the form must be delivered to |
6 | | the insured or third-party claimant at or before the time |
7 | | of settlement. |
8 | | (d) The Department may adopt rules establishing uniform |
9 | | standards for implementation of this Section, including, but |
10 | | not limited to, prescribing the method of determining the |
11 | | market value of the insured's or third-party claimant's |
12 | | vehicle.
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13 | | Section 99. Effective date. This Act takes effect July 1, |
14 | | 2022.
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