HB3639 96TH GENERAL ASSEMBLY

LRB096 10057 RPM 20222 b

96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
HB3639

Introduced 2/24/2009, by Rep. Karen May

SYNOPSIS AS INTRODUCED:

215 ILCS 5/357.9	from Ch. 73, par. 969.9
215 ILCS 5/357.9a	from Ch. 73, par. 969.9a

Amends the Illinois Insurance Code. Makes changes in the Section concerning the "time of payment of claims" provision required in each accident and health policy. With respect to the requirement that all claims and indemnities payable under the terms of a policy of accident and health insurance be paid within 30 days following receipt by the insurer of due proof of loss, provides that the policy of accident and health insurance includes both individual and group insurance against disablement or loss of time. Makes a change concerning application to a group policy of dental insurance. In the Section concerning a delay in payment of claims, provides that periodic payments of accrued indemnities for disablement or for loss-of-time coverage under both individual and group accident and health policies, as well as payment of accrued indemnity under any individual or group life or accidental death policy (instead of periodic payments of accrued indemnities for loss-of-time coverage under accident and health policies), shall commence not later than 30 days after the receipt by the company of the required written proof of loss.

A BILL FOR

AN ACT concerning 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 changing Sections 357.9 and 357.9a as follows:

(215 ILCS 5/357.9) (from Ch. 73, par. 969.9)

Sec. 357.9. "TIME OF PAYMENT OF CLAIMS: Indemnities payable under this policy for any loss other than loss for which this policy provides any periodic payment will be paid immediately upon receipt of due written proof of such loss. Subject to due written proof of loss, all accrued indemnities for loss for which this policy provides periodic payment will be paid .... (insert period for payment which must not be less frequently than monthly) and any balance remaining unpaid upon the termination of liability, will be paid immediately upon receipt of due written proof."

All claims and indemnities payable under the terms of a policy of accident and health insurance, including both individual and group insurance against disablement or loss of time, shall be paid within 30 days following receipt by the insurer of due proof of loss. Failure to pay within such period shall entitle the insured to interest at the rate of 9 per cent per annum from the 30th day after receipt of such proof of loss to the date of late payment, provided that interest amounting to less than one dollar need not be paid. An insured or an insured's assignee shall be notified by the insurer, health maintenance organization, managed care plan, health care plan, preferred provider organization, or third party administrator of any known failure to provide sufficient documentation for a due proof of loss within 30 days after receipt of the claim. Any required interest payments shall be made within 30 days after the payment.

The requirements of this Section shall apply to any policy of accident and health insurance delivered, issued for delivery, renewed or amended on or after 180 days following the effective date of this amendatory Act of 1985. The requirements of this Section also shall specifically apply to any group policy of dental insurance only, delivered, issued for delivery, renewed or amended on or after 180 days following the effective date of this amendatory Act of 1987. The changes to this Section made by this amendatory Act of the 96th General Assembly shall apply to any policy of accident and health insurance delivered, issued for delivery, renewed, or amended on or after 180 days following the effective date of this amendatory Act of the 96th General Assembly.

(Source: P.A. 91-605, eff. 12-14-99.)

(215 ILCS 5/357.9a) (from Ch. 73, par. 969.9a)

Sec. 357.9a. Delay in payment of claims. Periodic payments of accrued indemnities for disablement or for loss-of-time coverage under both individual and group accident and health policies, as well as payment of accrued indemnity under any individual or group life or accidental death policy, shall commence not later than 30 days after the receipt by the company of the required written proofs of loss. An insurer which violates this Section if liable under said policy, shall pay to the insured, in addition to any other penalty provided for in this Code, interest at the rate of 9% per annum from the 30th day after receipt of such proofs of loss to the date of late payment of the accrued indemnities, provided that interest amounting to less than one dollar need not be paid.

(Source: P.A. 92-139, eff. 7-24-01.)