Illinois General Assembly - Full Text of SB0061
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Full Text of SB0061  102nd General Assembly




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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 154.6 and by adding Section 154.9 as follows:
6    (215 ILCS 5/154.6)  (from Ch. 73, par. 766.6)
7    Sec. 154.6. Acts constituting improper claims practice.
8Any of the following acts by a company, if committed without
9just cause and in violation of Section 154.5, constitutes an
10improper claims practice:
11    (a) Knowingly misrepresenting to claimants and insureds
12relevant facts or policy provisions relating to coverages at
14    (b) Failing to acknowledge with reasonable promptness
15pertinent communications with respect to claims arising under
16its policies;
17    (c) Failing to adopt and implement reasonable standards
18for the prompt investigations and settlement of claims arising
19under its policies;
20    (d) Not attempting in good faith to effectuate prompt,
21fair and equitable settlement of claims submitted in which
22liability has become reasonably clear;
23    (e) Compelling policyholders to institute suits to recover



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1amounts due under its policies by offering substantially less
2than the amounts ultimately recovered in suits brought by
4    (f) Engaging in activity which results in a
5disproportionate number of meritorious complaints against the
6insurer received by the Insurance Department;
7    (g) Engaging in activity which results in a
8disproportionate number of lawsuits to be filed against the
9insurer or its insureds by claimants;
10    (h) Refusing to pay claims without conducting a reasonable
11investigation based on all available information;
12    (i) Failing to affirm or deny coverage of claims within a
13reasonable time after proof of loss statements have been
15    (j) Attempting to settle a claim for less than the amount
16to which a reasonable person would believe the claimant was
17entitled, by reference to written or printed advertising
18material accompanying or made part of an application or
19establishing unreasonable caps or limits on paint or materials
20when estimating vehicle repairs;
21    (k) Attempting to settle claims on the basis of an
22application which was altered without notice to, or knowledge
23or consent of, the insured;
24    (l) Making a claims payment to a policyholder or
25beneficiary omitting the coverage under which each payment is
26being made;



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1    (m) Delaying the investigation or payment of claims by
2requiring an insured, a claimant, or the physicians of either
3to submit a preliminary claim report and then requiring
4subsequent submission of formal proof of loss forms, resulting
5in the duplication of verification;
6    (n) Failing in the case of the denial of a claim or the
7offer of a compromise settlement to promptly provide a
8reasonable and accurate explanation of the basis in the
9insurance policy or applicable law for such denial or
10compromise settlement;
11    (o) Failing to provide forms necessary to present claims
12within 15 working days of a request with such explanations as
13are necessary to use them effectively;
14    (p) Failing to adopt and implement reasonable standards to
15verify that a repairer designated by the insurance company to
16provide an estimate, perform repairs, or engage in any other
17service in connection with an insured loss on a vehicle is duly
18licensed under Section 5-301 of the Illinois Vehicle Code;
19    (q) Failing to provide as a persistent tendency a
20notification on any written estimate prepared by an insurance
21company in connection with an insured loss that Illinois law
22requires that vehicle repairers must be licensed in accordance
23with Section 5-301 of the Illinois Vehicle Code;
24    (r) Failing to pay the replacement vehicle use or
25occupation tax, title, and transfer fees required by Section
26154.9 of this Code;



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1    (s) (r) Engaging in any other acts which are in substance
2equivalent to any of the foregoing.
3(Source: P.A. 90-340, eff. 8-8-97.)
4    (215 ILCS 5/154.9 new)
5    Sec. 154.9. Payment of applicable use or occupation tax,
6title, and transfer fees on a private passenger total loss
8    (a) When an insurer determines that an insured's or
9third-party claimant's private passenger automobile is a total
10loss that is covered under the terms of a personal automobile
11policy issued or renewed on or after July 1, 2022 by the
12insurer, the insurer shall pay any use or occupation tax
13imposed by the State or a unit of local government and title
14and transfer fees as provided for in this Section. As used in
15this Section, "private passenger vehicle" means a private
16passenger motor vehicle, station wagon, or any other 4-wheeled
17motor vehicle with a load capacity of 1,500 pounds or less that
18is not used in the occupation, profession, or business of the
19insured or third-party claimant, not used as a public or
20livery conveyance for passengers, nor rented to others.
21    (b) If the insurer elects to replace the insured vehicle,
22the insurer shall pay any use or occupation tax imposed by the
23State or a unit of local government tax and title and transfer
24fees on the replacement vehicle.
25    (c) If a cash settlement is provided for the total loss



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1private passenger vehicle, the insurer shall reimburse the
2insured or third-party claimant for any use or occupation tax
3imposed by the State or a unit of local government and title
4and transfer fees if the replacement vehicle is purchased or
5leased within 30 days after the receipt of the cash settlement
6by the insured or third-party claimant and the insured or
7third-party claimant substantiates such purchase and the
8payment of such taxes and fees by submission of appropriate
9documentation to the insurer within 33 days after the receipt
10of the settlement or receipt of the required reimbursement
11form 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
9standards for implementation of this Section, including, but
10not limited to, prescribing the method of determining the
11market value of the insured's or third-party claimant's
13    Section 99. Effective date. This Act takes effect July 1,