Full Text of SB2404 93rd General Assembly
SB2404eng 93RD GENERAL ASSEMBLY
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SB2404 Engrossed |
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LRB093 20536 SAS 46343 b |
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| AN ACT in relation to insurance.
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| Be it enacted by the People of the State of Illinois, | 3 |
| represented in the General Assembly:
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| Section 5. The Illinois Insurance Code is amended by | 5 |
| changing Sections 143, 229.4, and 408 and adding Section 229.4a | 6 |
| as follows:
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| (215 ILCS 5/143) (from Ch. 73, par. 755)
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| Sec. 143. Policy forms.
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| (1) Life, accident and health. No company
transacting the | 10 |
| kind or kinds of business enumerated in Classes 1 (a), 1
(b) | 11 |
| and 2 (a) of Section 4 shall issue or deliver in this State a | 12 |
| policy
or certificate of insurance or evidence of coverage, | 13 |
| attach an
endorsement or rider thereto,
incorporate by | 14 |
| reference bylaws or other matter therein or use an
application | 15 |
| blank in this State until the form and content of such
policy, | 16 |
| certificate, evidence of coverage, endorsement, rider, bylaw | 17 |
| or
other matter
incorporated by reference or application blank | 18 |
| has been filed electronically
with the Director, either through | 19 |
| the System for Electronic Rate and Form Filing (SERFF) or as | 20 |
| otherwise prescribed by the Director, and
approved by the | 21 |
| Director . The Department shall mail a quarterly invoice to the | 22 |
| company for the appropriate filing fees required under Section | 23 |
| 408.
and the appropriate filing fee under Section 408
has been | 24 |
| paid, except that Any such endorsement or rider
that | 25 |
| unilaterally reduces benefits and is to be attached to a
policy | 26 |
| subsequent to the date the policy is
issued must be filed with, | 27 |
| reviewed, and formally approved by the
Director prior to the | 28 |
| date it is attached to a policy issued or
delivered in this | 29 |
| State. It shall be the duty of the Director to
withhold | 30 |
| approval of any such policy, certificate, endorsement, rider,
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| bylaw or other matter incorporated by reference or application | 32 |
| blank
filed with him if it contains provisions which encourage
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| misrepresentation or are unjust, unfair, inequitable, | 2 |
| ambiguous,
misleading, inconsistent, deceptive, contrary to | 3 |
| law or to the public
policy of this State, or contains | 4 |
| exceptions and conditions that
unreasonably or deceptively | 5 |
| affect the risk purported to be assumed in
the general coverage | 6 |
| of the policy. In all cases the Director shall
approve or | 7 |
| disapprove any such form within 60 days after submission
unless | 8 |
| the Director extends by not more than an additional 30 days the
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| period within which he shall approve or disapprove any such | 10 |
| form by
giving written notice to the insurer of such extension | 11 |
| before expiration
of the initial 60 days period. The Director | 12 |
| shall withdraw his approval
of a policy, certificate, evidence | 13 |
| of coverage, endorsement, rider,
bylaw, or other matter | 14 |
| incorporated
by reference or application blank if he | 15 |
| subsequently determines that such
policy, certificate, | 16 |
| evidence of coverage, endorsement, rider, bylaw,
other matter, | 17 |
| or application
blank is misrepresentative, unjust, unfair, | 18 |
| inequitable, ambiguous, misleading,
inconsistent, deceptive, | 19 |
| contrary to law or public policy of this State,
or contains | 20 |
| exceptions or conditions which unreasonably or deceptively | 21 |
| affect
the risk purported to be assumed in the general coverage | 22 |
| of the policy or
evidence of coverage.
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| If a previously approved policy, certificate, evidence of
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| coverage, endorsement, rider, bylaw
or other matter | 25 |
| incorporated by reference or application blank is withdrawn
for | 26 |
| use, the Director shall serve upon the company an order of | 27 |
| withdrawal
of use, either personally or by mail, and if by | 28 |
| mail, such service shall
be completed if such notice be | 29 |
| deposited in the post office, postage prepaid,
addressed to the | 30 |
| company's last known address specified in the records
of the | 31 |
| Department of Insurance. The order of withdrawal of use shall | 32 |
| take
effect 30 days from the date of mailing but shall be | 33 |
| stayed if within the
30-day period a written request for | 34 |
| hearing is filed with the Director.
Such hearing shall be held | 35 |
| at such time and place as designated in the order
given by the | 36 |
| Director. The hearing may be held either in the City of |
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| Springfield,
the City of Chicago or in the county where the | 2 |
| principal business address
of the company is located.
The | 3 |
| action of the Director in
disapproving or withdrawing such form | 4 |
| shall be subject to judicial review under
the
Administrative | 5 |
| Review Law.
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| All examinations, investigations, and hearings provided | 7 |
| for by this Code may
be conducted either by the Director | 8 |
| personally or by one or more of the
actuaries, technical | 9 |
| advisors, deputies, supervisors, or examiners
employed or | 10 |
| retained by the Department and designated by the Director
for | 11 |
| that purpose. When necessary to supplement its examination
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| procedures, the Department may retain independent actuaries | 13 |
| deemed
competent by the Director, independent certified public | 14 |
| accountants, or
qualified examiners of insurance companies | 15 |
| deemed competent by the
Director, or any combination of the | 16 |
| foregoing, the cost of which shall
be borne by the company or | 17 |
| person being examined.
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| This subsection shall not apply to riders or endorsements | 19 |
| issued or
made at the request of the individual policyholder | 20 |
| relating to the
manner of distribution of benefits or to the | 21 |
| reservation of rights and
benefits under his life insurance | 22 |
| policy.
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| (2) Casualty, fire, and marine. The Director shall require | 24 |
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filing of all policy forms issued or delivered by any | 25 |
| company transacting
the kind or
kinds of business enumerated in | 26 |
| Classes 2 (except Class 2 (a)) and 3 of
Section 4. In addition, | 27 |
| he may require the filing of any
generally used riders, | 28 |
| endorsements, certificates, application blanks, and
other | 29 |
| matter
incorporated by reference in any such policy or contract | 30 |
| of insurance . The Department shall mail a quarterly invoice to | 31 |
| the company for the appropriate filing fees required under | 32 |
| Section 408
along with the appropriate filing fee under Section | 33 |
| 408 .
Companies that are members of an organization, bureau, or | 34 |
| association may
have the same filed for them by the | 35 |
| organization, bureau, or association. If
the Director shall | 36 |
| find from an examination of any such policy form,
rider, |
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| endorsement, certificate, application blank, or other matter
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| incorporated by
reference in any such policy so filed that it | 3 |
| (i) violates any provision of
this Code, (ii) contains | 4 |
| inconsistent, ambiguous, or misleading clauses, or
(iii) | 5 |
| contains exceptions and conditions that will unreasonably or | 6 |
| deceptively
affect the risks that are purported to be assumed | 7 |
| by the policy, he
shall order the company or companies issuing | 8 |
| these forms to discontinue
their use. Nothing in this | 9 |
| subsection shall require a company
transacting the kind or | 10 |
| kinds of business enumerated in Classes 2
(except Class 2 (a)) | 11 |
| and 3 of Section 4 to obtain approval of these forms
before | 12 |
| they are issued nor in any way affect the legality of any
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| policy that has been issued and found to be in conflict with | 14 |
| this
subsection, but such policies shall be subject to the | 15 |
| provisions of
Section 442.
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| (3) This Section shall not apply (i) to surety contracts or | 17 |
| fidelity
bonds, (ii) to policies issued to an industrial | 18 |
| insured as defined in Section
121-2.08 except for workers' | 19 |
| compensation policies, nor (iii) to riders
or
endorsements | 20 |
| prepared to meet special, unusual,
peculiar, or extraordinary | 21 |
| conditions applying to an individual risk.
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| (Source: P.A. 90-794, eff. 8-14-98.)
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| (215 ILCS 5/229.4) (from Ch. 73, par. 841.4)
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| Sec. 229.4. Standard Non-forfeiture Law for Individual | 26 |
| Deferred
Annuities.
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| (1) No contract of annuity issued on or after the operative | 28 |
| date of this
Section except as stated in subsection (11) shall | 29 |
| be delivered or
issued
for delivery in this State unless it | 30 |
| contains in substance the following
provisions or | 31 |
| corresponding provisions which in the opinion of the Director
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| are at least as favorable to the contract holder upon cessation | 33 |
| of payment
of considerations under the contract:
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| (a) That upon cessation of payment of considerations |
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| under a contract,
the company will grant a paid-up annuity | 2 |
| benefit on a plan stipulated in
the contract of such value | 3 |
| as is specified in subsections (3), (4), (5), (6)
and (8).
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| (b) If a contract provides for a lump sum settlement at | 5 |
| maturity, or at
any other time, that upon surrender of the | 6 |
| contract at or prior to the
commencement of any annuity | 7 |
| payments, the company will pay in lieu of any
paid-up | 8 |
| annuity benefit a cash surrender benefit of such amount as | 9 |
| is specified
in subsections (3), (4), (6) and (8). The | 10 |
| company shall reserve the right
to defer the payment of | 11 |
| such cash surrender benefit for a period of 6 months
after | 12 |
| demand therefor with surrender of the contract.
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| (c) A statement of the mortality table, if any, and | 14 |
| interest rates used
in calculating any minimum paid-up | 15 |
| annuity, cash surrender or death benefits
that are | 16 |
| guaranteed under the contract, together with sufficient | 17 |
| information
to determine the amount of such benefits.
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| (d) A statement that any paid-up annuity, cash | 19 |
| surrender or death benefits
that may be available under the | 20 |
| contract are not less than the minimum benefits
required by | 21 |
| any statute of the state in which the contract is delivered
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| and an explanation of the manner in which such benefits are | 23 |
| altered by the
existence of any additional amounts credited | 24 |
| by the company to the contract,
any indebtedness to the | 25 |
| company on the contract or any prior withdrawals
from or | 26 |
| partial surrenders of the contract.
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| Notwithstanding the requirements of this subsection, any | 28 |
| deferred annuity
contract may provide that if no considerations | 29 |
| have been received under
a contract for a period of 2 full | 30 |
| years and the portion of the paid-up
annuity benefit at | 31 |
| maturity on the plan stipulated in the contract arising
from | 32 |
| considerations paid prior to such period would be less than | 33 |
| $20.00
monthly, the company may at its option terminate such | 34 |
| contract by payment
in cash of the present value of such | 35 |
| portion of the paid-up annuity
benefit, calculated on the basis | 36 |
| of the mortality table, if any, and interest
rate specified in |
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| the contract for determining the paid-up annuity benefit,
and | 2 |
| by such payment shall be relieved of any further obligation | 3 |
| under such
contract.
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| (2) The minimum values as specified in subsections (3), | 5 |
| (4), (5), (6)
and (8) of any paid-up annuity, cash surrender or | 6 |
| death benefits available
under an annuity contract shall be | 7 |
| based upon minimum nonforfeiture amounts
as defined in this | 8 |
| subsection.
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| (a) With respect to contracts providing for flexible | 10 |
| considerations,
the minimum nonforfeiture amount at any | 11 |
| time at or prior to the commencement
of any annuity | 12 |
| payments shall be equal to an accumulation up to such time
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| at a rate of interest of 3% per annum of percentages of the | 14 |
| net considerations,
as hereinafter defined, paid prior to | 15 |
| such time, decreased by the sum of
(i) any prior | 16 |
| withdrawals from or partial surrenders of the contract
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| accumulated
at a rate of interest of 3% per annum and (ii) | 18 |
| the amount of any indebtedness
to the company on the | 19 |
| contract, including interest due and accrued, and
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| increased by any existing additional amounts credited by | 21 |
| the company to the
contract.
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| The net considerations for a given contract year used | 23 |
| to define the minimum
nonforfeiture amount shall be an | 24 |
| amount not less than zero and shall be
equal to the | 25 |
| corresponding gross considerations credited to the | 26 |
| contract
during that contract year less an annual contract | 27 |
| charge of $30.00 and less
a collection charge of $1.25 per | 28 |
| consideration credited to the contract
during that | 29 |
| contract year. The percentages of net considerations shall
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| be 65% of the net consideration for the first contract year | 31 |
| and 87 1/2%
of the net considerations for the second and | 32 |
| later contract years.
Notwithstanding
the provisions of | 33 |
| the preceding sentence, the percentage shall be 65% of
the | 34 |
| portion of the total net consideration for any renewal | 35 |
| contract year
which exceeds by not more than two times the | 36 |
| sum of those portions of the
net considerations in all |
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| prior contract years for which the percentage was
65%.
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| (a-5) Notwithstanding the provisions of paragraph (a) | 3 |
| of this
subsection,
the minimum nonforfeiture amount for | 4 |
| any contract issued on or after July 1,
2002 and before | 5 |
| July 1, 2005 shall be based on a rate of interest of 1.5% | 6 |
| per
annum.
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| (b) With respect to contracts providing for fixed | 8 |
| scheduled
considerations,
minimum nonforfeiture amounts | 9 |
| shall be calculated on the assumption that
considerations | 10 |
| are paid annually in advance and shall be defined as for
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| contracts with flexible considerations which are paid | 12 |
| annually, with two
exceptions:
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| (i) The portion of the net consideration for the | 14 |
| first contract year
to be accumulated shall be the sum | 15 |
| of 65% of the net consideration for the
first contract | 16 |
| year plus 22 1/2% of the excess of the net | 17 |
| consideration
for the first contract year over the | 18 |
| lesser of the net considerations for
the second and | 19 |
| third contract years.
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| (ii) The annual contract charge shall be the lesser | 21 |
| of (A) $30.00 or
(B) 10% of the gross annual | 22 |
| consideration.
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| (c) With respect to contracts providing for a single | 24 |
| consideration,
minimum nonforfeiture amounts shall be | 25 |
| defined as for contracts with flexible
considerations | 26 |
| except that the percentage of net consideration used to
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| determine the minimum nonforfeiture amount shall be equal | 28 |
| to 90% and the net
consideration shall be the gross | 29 |
| consideration less a contract charge of
$75.00.
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| (3) Any paid-up annuity benefit available under a contract | 31 |
| shall be
such that its present value on the date annuity | 32 |
| payments are to commence
is at least equal to the minimum | 33 |
| nonforfeiture amount on that date. Such
present value shall be | 34 |
| computed using the mortality table, if any, and the
interest | 35 |
| rate specified in the contract for determining the minimum | 36 |
| paid-up
annuity benefits guaranteed in the contract.
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| (4) For contracts which provide cash surrender benefits, | 2 |
| such cash surrender
benefits available prior to maturity shall | 3 |
| not be less than the present value
as of the date of surrender | 4 |
| of that portion of the maturity value of the
paid-up annuity | 5 |
| benefit which would be provided under the contract at maturity
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| arising from considerations paid prior to the time of cash | 7 |
| surrender reduced
by the amount appropriate to reflect any | 8 |
| prior withdrawals from or partial
surrenders of the contract, | 9 |
| such present value being calculated
on the basis of an interest | 10 |
| rate not more than 1% higher than the interest
rate specified | 11 |
| in the contract for accumulating the net considerations to
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| determine such maturity value, decreased by the amount of any | 13 |
| indebtedness
to the company on the contract, including interest | 14 |
| due and accrued, and
increased by any existing additional | 15 |
| amounts credited by the company to
the contract. In no event | 16 |
| shall any cash surrender benefit be less than
the minimum | 17 |
| nonforfeiture amount at that time. The death benefit under
such | 18 |
| contracts shall be at least equal to the cash surrender | 19 |
| benefit.
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| (5) For contracts which do not provide cash surrender | 21 |
| benefits, the
present value of any paid-up annuity benefit | 22 |
| available as a nonforfeiture
option at any time prior to | 23 |
| maturity shall not be less than the present
value of that | 24 |
| portion of the maturity value of the paid-up benefit provided
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| under the contract arising from considerations paid prior to | 26 |
| the time of
the contract is surrendered in exchange for, or | 27 |
| changed to, a deferred paid-up
annuity, such present value | 28 |
| being calculated for the period prior to the
maturity date on | 29 |
| the basis of the interest rate specified in the contract
for | 30 |
| accumulating the net considerations to determine such maturity | 31 |
| value,
and increased by any existing additional amounts | 32 |
| credited by the company
to the contract. For contracts which do | 33 |
| not provide any death benefits
prior to the commencement of any | 34 |
| annuity payments, such present values shall
be calculated on | 35 |
| the basis of such interest rate and the mortality table
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| specified in the contract for determining the maturity value of |
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LRB093 20536 SAS 46343 b |
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| the paid-up
annuity benefit. However, in no event shall the | 2 |
| present value of a paid-up
annuity benefit be less than the | 3 |
| minimum nonforfeiture amount at that time.
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| (6) For the purpose of determining the benefits calculated | 5 |
| under subsections
(4) and (5), in the case of annuity contracts | 6 |
| under which an election may
be made to have annuity payments | 7 |
| commence at optional maturity dates, the
maturity date shall be | 8 |
| deemed to be the latest date for which election shall
be | 9 |
| permitted by the contract, but shall not be deemed to be later | 10 |
| than the
anniversary of the contract next following the | 11 |
| annuitant's seventieth birthday
or the tenth anniversary of the | 12 |
| contract, whichever is later.
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| (7) Any contract which does not provide cash surrender | 14 |
| benefits or does
not provide death benefits at least equal to | 15 |
| the minimum nonforfeiture amount
prior to the commencement of | 16 |
| any annuity payments shall include a statement
in a prominent | 17 |
| place in the contract that such benefits are not provided.
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| (8) Any paid-up annuity, cash surrender or death benefits | 19 |
| available
at any time, other than on the contract anniversary | 20 |
| under any contract with
fixed scheduled considerations, shall | 21 |
| be calculated with allowance for the
lapse of time and the | 22 |
| payment of any scheduled considerations beyond the
beginning of | 23 |
| the contract year in which cessation of payment of | 24 |
| considerations
under the contract occurs.
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| (9) For any contract which provides, within the same | 26 |
| contract by rider
or supplemental contract provision, both | 27 |
| annuity benefits and life insurance
benefits that are in excess | 28 |
| of the greater of cash surrender benefits or
a return of the | 29 |
| gross considerations with interest, the minimum nonforfeiture
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| benefits shall be equal to the sum of the minimum nonforfeiture | 31 |
| benefits
for the annuity portion and the minimum nonforfeiture | 32 |
| benefits, if any,
for the life insurance portion computed as if | 33 |
| each portion were a separate
contract. Notwithstanding the | 34 |
| provisions of subsections (3), (4), (5),
(6) and (8), | 35 |
| additional benefits payable (a) in the event of total and
| 36 |
| permanent disability, (b) as reversionary annuity or deferred |
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LRB093 20536 SAS 46343 b |
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| reversionary
annuity
benefits, or (c) as other policy benefits | 2 |
| additional to life insurance,
endowment, and annuity benefits, | 3 |
| and considerations for all such additional
benefits, shall be | 4 |
| disregarded in ascertaining the minimum nonforfeiture
amounts, | 5 |
| paid-up annuity, cash surrender and death benefits that may be
| 6 |
| required by this section. The inclusion of such additional | 7 |
| benefits shall
not be required in any paid-up benefits, unless | 8 |
| such additional benefits
separately would require minimum | 9 |
| nonforfeiture amounts, paid-up annuity,
cash surrender and | 10 |
| death benefits.
| 11 |
| (10) After the effective date of this Section, any company | 12 |
| may file
with the Director a written notice of its election to | 13 |
| comply with the
provisions of this Section after a specified | 14 |
| date before the second anniversary
of the effective date of | 15 |
| this Section. After the filing of such notice, then
upon such | 16 |
| specified date, which shall be the operative date of this | 17 |
| section
for such company, this Section shall become operative | 18 |
| with respect to annuity
contracts thereafter issued by such | 19 |
| company. If a company makes no such
election, the operative | 20 |
| date of this section for such company shall be the
second | 21 |
| anniversary of the effective date of this Section.
| 22 |
| (11) This Section shall not apply to any reinsurance, group | 23 |
| annuity
purchased under a retirement plan or plan of deferred | 24 |
| compensation established
or maintained by an employer | 25 |
| (including a partnership or sole proprietorship)
or by an | 26 |
| employee organization, or by both, other than a plan providing
| 27 |
| individual retirement accounts or individual retirement | 28 |
| annuities under
Section 408 of the Internal Revenue Code, as | 29 |
| now or hereafter amended, premium
deposit fund, variable | 30 |
| annuity, investment annuity, immediate annuity, any
deferred | 31 |
| annuity contract after annuity payments have commenced, or
| 32 |
| reversionary
annuity, nor to any contract which shall be | 33 |
| delivered outside this State
through an agent or other | 34 |
| representative of the company issuing the contract.
| 35 |
| (12) This Section is repealed on July 1, 2006.
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| (Source: P.A. 92-541, eff. 7-1-02.)
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LRB093 20536 SAS 46343 b |
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| (215 ILCS 5/229.4a new)
| 2 |
| Sec. 229.4a. Standard Non-forfeiture Law for Individual | 3 |
| Deferred
Annuities. | 4 |
| (1)
Title.
This Section shall be known as the Standard | 5 |
| Nonforfeiture Law for Individual Deferred Annuities. | 6 |
| (2) Applicability.
This Section shall not apply to any | 7 |
| reinsurance, group annuity purchased under a retirement plan or | 8 |
| plan of deferred compensation established or maintained by an | 9 |
| employer (including a partnership or sole proprietorship) or by | 10 |
| an employee organization, or by both, other than a plan | 11 |
| providing individual retirement accounts or individual | 12 |
| retirement annuities under Section 408 of the Internal Revenue | 13 |
| Code, as now or hereafter amended, premium deposit fund, | 14 |
| variable annuity, investment annuity, immediate annuity, any | 15 |
| deferred annuity contract after annuity payments have | 16 |
| commenced, or reversionary annuity, nor to any contract which | 17 |
| shall be delivered outside this State through an agent or other | 18 |
| representative of the company issuing the contract. | 19 |
| (3) Nonforfeiture Requirements. | 20 |
| (A) In the case of contracts issued on or after the | 21 |
| operative date of this Section
as defined in subsection | 22 |
| (13), no contract of annuity, except as stated in | 23 |
| subsection (2), shall be delivered or issued for delivery | 24 |
| in this State unless it contains in substance the following | 25 |
| provisions, or corresponding provisions which in the | 26 |
| opinion of the Director of Insurance are at least as | 27 |
| favorable to the contract holder, upon cessation of payment | 28 |
| of considerations under the contract: | 29 |
| (i) That upon cessation of payment of | 30 |
| considerations under a contract, or upon the written | 31 |
| request of the contract owner, the company shall grant | 32 |
| a paid-up annuity benefit on a plan stipulated in the | 33 |
| contract of such value as is specified in subsections | 34 |
| (5), (6), (7), (8) and (10); | 35 |
| (ii)
If a contract provides for a lump sum |
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LRB093 20536 SAS 46343 b |
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| settlement at maturity, or at any other time, that upon | 2 |
| surrender of the contract at or prior to the | 3 |
| commencement of any annuity payments, the company | 4 |
| shall pay in lieu of a paid-up annuity benefit a cash | 5 |
| surrender benefit of such amount as is
specified in | 6 |
| subsections (5), (6), (8) and (10). The company may | 7 |
| reserve the right to
defer the payment of the cash | 8 |
| surrender benefit for a period not to exceed 6 months | 9 |
| after demand therefor with surrender of the contract | 10 |
| after making written request and receiving written | 11 |
| approval of the Director. The request shall address the | 12 |
| necessity and equitability to all policyholders of the | 13 |
| deferral; | 14 |
| (iii) A statement of the mortality table, if any, | 15 |
| and interest rates used calculating any minimum | 16 |
| paid-up annuity, cash surrender, or death benefits | 17 |
| that are guaranteed under the contract, together with | 18 |
| sufficient information to determine the amounts of the | 19 |
| benefits; and | 20 |
| (iv)
A statement that any paid-up annuity, cash | 21 |
| surrender or death benefits that may be available under | 22 |
| the contract are not less than the minimum benefits | 23 |
| required by any statute of the state in which the | 24 |
| contract is delivered and an explanation of the manner | 25 |
| in which the benefits are altered by the existence of | 26 |
| any additional amounts credited by the company to the | 27 |
| contract, any indebtedness to the company on the | 28 |
| contract or any prior withdrawals from or partial | 29 |
| surrenders of the contract. | 30 |
| (B) Notwithstanding the requirements of this Section, | 31 |
| a deferred annuity contract may provide that if no | 32 |
| considerations have been received under a contract for a | 33 |
| period of 2 full years and the portion of the paid-up | 34 |
| annuity benefit at maturity on the plan stipulated in the | 35 |
| contract arising from prior considerations paid would be | 36 |
| less than $20 monthly, the company may at its option |
|
|
|
SB2404 Engrossed |
- 13 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| terminate the contract by payment in cash of the then | 2 |
| present value of the portion of the paid-up annuity | 3 |
| benefit, calculated on the basis on the mortality table, if | 4 |
| any, and interest rate specified in the contract for | 5 |
| determining the paid-up annuity benefit, and by this | 6 |
| payment shall be relieved of any further obligation under | 7 |
| the contract. | 8 |
| (4) Minimum values. The minimum values as specified in | 9 |
| subsections (5), (6), (7), (8) and (10) of any paid-up annuity, | 10 |
| cash surrender or death benefits available under an annuity | 11 |
| contract shall be based upon minimum nonforfeiture amounts as | 12 |
| defined in this subsection.
| 13 |
| (A)(i) The minimum nonforfeiture amount at any time at | 14 |
| or prior to the commencement of any annuity payments shall | 15 |
| be equal to an accumulation up to such time at rates of | 16 |
| interest as indicated in subdivision (4)(B) of the net | 17 |
| considerations (as hereinafter defined) paid prior to such | 18 |
| time, decreased by the sum of paragraphs (a) through (d) | 19 |
| below: | 20 |
| (a) Any prior withdrawals from or partial | 21 |
| surrenders of the contract accumulated at rates of | 22 |
| interest as indicated in subdivision (4)(B);
| 23 |
| (b) An annual contract charge of $50, | 24 |
| accumulated at rates of interest as indicated in | 25 |
| subdivision (4)(B);
| 26 |
| (c) Any premium tax paid by the company for the | 27 |
| contract, accumulated at rates of interest as | 28 |
| indicated in subdivision (4)(B); and
| 29 |
| (d) The amount of any indebtedness to the | 30 |
| company on the contract, including
interest due and | 31 |
| accrued. | 32 |
| (ii) The net considerations for a given contract year | 33 |
| used to define the minimum nonforfeiture amount shall be an | 34 |
| amount
equal to 87.5% of the gross considerations,
credited | 35 |
| to the contract during that contract year. | 36 |
| (B) The interest rate used in determining minimum |
|
|
|
SB2404 Engrossed |
- 14 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| nonforfeiture amounts shall be an
annual rate of interest | 2 |
| determined as the lesser of 3% per annum
and the following, | 3 |
| which shall be specified in the contract if the interest | 4 |
| rate will be reset: | 5 |
| (i) The five-year Constant Maturity Treasury Rate | 6 |
| reported by the Federal Reserve as of a date, or | 7 |
| average over a period, rounded to the nearest 1/20th of | 8 |
| one percent, specified in the contract no longer than | 9 |
| 15 months prior to the contract issue date or | 10 |
| redetermination date under subdivision (4)(B)(iv); | 11 |
| (ii) Reduced by 125 basis points; | 12 |
| (iii) Where the resulting interest rate is not less | 13 |
| than l%; and | 14 |
| (iv) The interest rate shall apply for an initial | 15 |
| period and may be redetermined for additional periods. | 16 |
| The redetermination date, basis and period, if any, | 17 |
| shall be stated in the contract. The basis is the date | 18 |
| or average over a specified period that produces the | 19 |
| value of the 5-year Constant Maturity Treasury Rate to | 20 |
| be used at each redetermination date. | 21 |
| (C) During the period or term that a contract provides | 22 |
| substantive participation in an equity indexed benefit, it | 23 |
| may increase the reduction described in subdivision | 24 |
| (4)(B)(ii)
above by up to an additional 100 basis points to | 25 |
| reflect the value of the equity
index benefit. The present | 26 |
| value at the contract issue date, and at each
| 27 |
| redetermination date thereafter, of the additional | 28 |
| reduction shall not exceed market value of the benefit. The | 29 |
| Director may require a demonstration that the present value | 30 |
| of the additional reduction does not exceed the market | 31 |
| value of the benefit. Lacking such a demonstration that is | 32 |
| acceptable to the Director, the Director may disallow or | 33 |
| limit the additional reduction. | 34 |
| (D) The Director may adopt rules to implement the | 35 |
| provisions of subdivision (4)(C) and to provide for further | 36 |
| adjustments to the calculation of minimum nonforfeiture |
|
|
|
SB2404 Engrossed |
- 15 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| amounts for contracts that provide substantive | 2 |
| participation in an equity index benefit and for other | 3 |
| contracts that the Director determines adjustments are | 4 |
| justified. | 5 |
| (5) Computation of Present Value.
Any paid-up annuity | 6 |
| benefit available under a contract shall be such that its | 7 |
| present value on the date annuity payments are to commence is | 8 |
| at least equal to the minimum nonforfeiture amount on that | 9 |
| date. Present value shall be computed using the mortality | 10 |
| table, if any, and the interest rates specified in the contract | 11 |
| for determining the minimum paid-up annuity benefits | 12 |
| guaranteed in the contract. | 13 |
| (6) Calculation of Cash Surrender Value.
For contracts that | 14 |
| provide cash surrender benefits, the cash surrender benefits | 15 |
| available prior to maturity shall not be less than the present | 16 |
| value as of the date of surrender of that portion of the | 17 |
| maturity value of the paid-up annuity benefit that would be | 18 |
| provided under the contract at maturity arising from | 19 |
| considerations paid prior to the time of cash surrender reduced | 20 |
| by the amount appropriate to reflect any prior withdrawals from | 21 |
| or partial surrenders of the contract, such present value being | 22 |
| calculated on the basis of an interest rate not more than 1% | 23 |
| higher than the interest rate specified in the contract for | 24 |
| accumulating the net considerations to determine maturity | 25 |
| value, decreased by the amount of any indebtedness to the | 26 |
| company on the contract, including interest due and accrued, | 27 |
| and increased by any existing additional amounts credited by | 28 |
| the company to the contract. In no event shall any cash | 29 |
| surrender benefit be less than the minimum nonforfeiture amount | 30 |
| at that time. The death benefit under such contracts shall be | 31 |
| at least equal to the cash surrender benefit. | 32 |
| (7) Calculation of Paid-up Annuity Benefits.
For contracts | 33 |
| that do not provide cash surrender benefits, the present value | 34 |
| of any paid-up annuity benefit available as a nonforfeiture | 35 |
| option at any time prior to maturity shall not be less than the | 36 |
| present value of that portion of the maturity value of the |
|
|
|
SB2404 Engrossed |
- 16 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| paid-up annuity benefit provided under the contract arising | 2 |
| from considerations paid prior to the time the contract is
| 3 |
| surrendered in exchange for, or changed to, a deferred paid-up | 4 |
| annuity, such present value being calculated for the period | 5 |
| prior to the maturity date on the basis of the interest rate | 6 |
| specified in the contract for accumulating the net | 7 |
| considerations to determine maturity value, and increased by | 8 |
| any additional amounts credited by the company to the contract. | 9 |
| For contracts that do not provide any death benefits prior to | 10 |
| the commencement of any annuity payments, present values shall | 11 |
| be calculated on the basis of such interest rate and the | 12 |
| mortality table specified in the contract for determining the | 13 |
| maturity value of the paid-up annuity benefit. However, in no | 14 |
| event shall the present value of a paid-up annuity benefit be | 15 |
| less than the minimum nonforfeiture amount at that time. | 16 |
| (8) Maturity Date.
For the purpose of determining the | 17 |
| benefits calculated under subsections (6) and (7), in the case | 18 |
| of annuity contracts under which an election may be made to | 19 |
| have annuity payments commence at optional maturity dates, the | 20 |
| maturity date shall be deemed to be the latest date for which | 21 |
| election shall be permitted by the contract, but shall not be | 22 |
| deemed to be later than the anniversary of the contract next | 23 |
| following the annuitant's seventieth birthday or the tenth | 24 |
| anniversary of the contract, whichever is later. | 25 |
| (9) Disclosure of Limited Death Benefits.
A contract that | 26 |
| does not provide cash surrender benefits or does not provide | 27 |
| death benefits at least equal to the minimum nonforfeiture | 28 |
| amount prior to the commencement of any annuity payments shall | 29 |
| include a statement in a prominent place in the contract that | 30 |
| such benefits are not
provided. | 31 |
| (10) Inclusion of Lapse of Time Considerations.
Any paid-up | 32 |
| annuity, cash surrender or death benefits available at any | 33 |
| time, other than on the contract anniversary under any contract | 34 |
| with fixed scheduled considerations, shall be calculated with | 35 |
| allowance for the lapse of time and the payment of any | 36 |
| scheduled considerations beyond the beginning of the contract |
|
|
|
SB2404 Engrossed |
- 17 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| year in which cessation of payment of considerations under the | 2 |
| contract occurs. | 3 |
| (11) Proration of Values; Additional Benefits.
For a | 4 |
| contract which provides, within the same contract by rider or | 5 |
| supplemental contract provision, both annuity benefits and | 6 |
| life insurance benefits that are in excess of the greater of | 7 |
| cash surrender benefits or a return of the gross considerations | 8 |
| with interest, the minimum nonforfeiture benefits shall be | 9 |
| equal to the sum of the minimum nonforfeiture benefits for the | 10 |
| annuity portion and the minimum nonforfeiture benefits, if any, | 11 |
| for the life insurance portion computed as if each portion were | 12 |
| a separate contract. Notwithstanding the provisions of | 13 |
| subsections (5), (6), (7), (8) and (10), additional benefits | 14 |
| payable in the event of total and permanent disability, as | 15 |
| reversionary annuity or deferred reversionary annuity | 16 |
| benefits, or as other policy benefits additional to life | 17 |
| insurance, endowment and annuity benefits, and considerations | 18 |
| for all such additional benefits, shall be disregarded in | 19 |
| ascertaining the minimum nonforfeiture amounts,
paid-up | 20 |
| annuity, cash surrender and death benefits that may be required | 21 |
| under this Section. The inclusion of such benefits shall not be | 22 |
| required in any paid-up benefits, unless the additional | 23 |
| benefits separately would require minimum nonforfeiture | 24 |
| amounts, paid-up annuity, cash surrender and death benefits. | 25 |
| (12) Rules. The Director may adopt rules to implement the | 26 |
| provisions of this Section. | 27 |
| (13) Effective Date. After the effective date of this | 28 |
| amendatory Act of the 93rd General Assembly, a company may | 29 |
| elect to apply its provisions to annuity
contracts on a | 30 |
| contract form-by-contract form basis before July 1, 2006. In | 31 |
| all other instances, this Section shall become operative with | 32 |
| respect to annuity contracts issued by the company on or after | 33 |
| July 1, 2006.
| 34 |
| (215 ILCS 5/408) (from Ch. 73, par. 1020)
| 35 |
| Sec. 408. Fees and charges.
|
|
|
|
SB2404 Engrossed |
- 18 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| (1) The Director shall charge, collect and
give proper | 2 |
| acquittances for the payment of the following fees and charges:
| 3 |
| (a) For filing all documents submitted for the | 4 |
| incorporation or
organization or certification of a | 5 |
| domestic company, except for a fraternal
benefit society, | 6 |
| $2,000.
| 7 |
| (b) For filing all documents submitted for the | 8 |
| incorporation or
organization of a fraternal benefit | 9 |
| society, $500.
| 10 |
| (c) For filing amendments to articles of incorporation | 11 |
| and amendments to
declaration of organization, except for a | 12 |
| fraternal benefit society, a
mutual benefit association, a | 13 |
| burial society or a farm mutual, $200.
| 14 |
| (d) For filing amendments to articles of incorporation | 15 |
| of a fraternal
benefit society, a mutual benefit | 16 |
| association or a burial society, $100.
| 17 |
| (e) For filing amendments to articles of incorporation | 18 |
| of a farm mutual,
$50.
| 19 |
| (f) For filing bylaws or amendments thereto, $50.
| 20 |
| (g) For filing agreement of merger or consolidation:
| 21 |
| (i) for a domestic company, except
for a fraternal | 22 |
| benefit society, a
mutual benefit association, a | 23 |
| burial society,
or a farm mutual, $2,000.
| 24 |
| (ii) for a foreign or
alien company, except for a | 25 |
| fraternal
benefit society, $600.
| 26 |
| (iii) for a fraternal benefit society,
a mutual | 27 |
| benefit association, a burial society,
or a farm | 28 |
| mutual, $200.
| 29 |
| (h) For filing agreements of reinsurance by a domestic | 30 |
| company, $200.
| 31 |
| (i) For filing all documents submitted by a foreign or | 32 |
| alien
company to be admitted to transact business or | 33 |
| accredited as a
reinsurer in this State, except for a
| 34 |
| fraternal benefit society, $5,000.
| 35 |
| (j) For filing all documents submitted by a foreign or | 36 |
| alien
fraternal benefit society to be admitted to transact |
|
|
|
SB2404 Engrossed |
- 19 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| business
in this State, $500.
| 2 |
| (k) For filing declaration of withdrawal of a foreign | 3 |
| or
alien company, $50.
| 4 |
| (l) For filing annual statement, except a fraternal | 5 |
| benefit
society, a mutual benefit association, a burial | 6 |
| society, or
a farm mutual, $200.
| 7 |
| (m) For filing annual statement by a fraternal benefit
| 8 |
| society, $100.
| 9 |
| (n) For filing annual statement by a farm mutual, a | 10 |
| mutual benefit
association, or a burial society, $50.
| 11 |
| (o) For issuing a certificate of authority or
renewal | 12 |
| thereof except to a fraternal benefit society, $200.
| 13 |
| (p) For issuing a certificate of authority or renewal | 14 |
| thereof to a
fraternal benefit society, $100.
| 15 |
| (q) For issuing an amended certificate of authority, | 16 |
| $50.
| 17 |
| (r) For each certified copy of certificate of | 18 |
| authority, $20.
| 19 |
| (s) For each certificate of deposit, or valuation, or | 20 |
| compliance
or surety certificate, $20.
| 21 |
| (t) For copies of papers or records per page, $1.
| 22 |
| (u) For each certification to copies
of papers or | 23 |
| records, $10.
| 24 |
| (v) For multiple copies of documents or certificates | 25 |
| listed in
subparagraphs (r), (s), and (u) of paragraph (1) | 26 |
| of this Section, $10 for
the first copy of a certificate of | 27 |
| any type and $5 for each additional copy
of the same | 28 |
| certificate requested at the same time, unless, pursuant to
| 29 |
| paragraph (2) of this Section, the Director finds these | 30 |
| additional fees
excessive.
| 31 |
| (w) For issuing a permit to sell shares or increase | 32 |
| paid-up
capital:
| 33 |
| (i) in connection with a public stock offering, | 34 |
| $300;
| 35 |
| (ii) in any other case, $100.
| 36 |
| (x) For issuing any other certificate required or |
|
|
|
SB2404 Engrossed |
- 20 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| permissible
under the law, $50.
| 2 |
| (y) For filing a plan of exchange of the stock of a | 3 |
| domestic
stock insurance company, a plan of | 4 |
| demutualization of a domestic
mutual company, or a plan of | 5 |
| reorganization under Article XII, $2,000.
| 6 |
| (z) For filing a statement of acquisition of a
domestic | 7 |
| company as defined in Section 131.4 of this Code, $2,000.
| 8 |
| (aa) For filing an agreement to purchase the business | 9 |
| of an
organization authorized under the Dental Service Plan | 10 |
| Act
or the Voluntary Health Services Plans Act or
of a | 11 |
| health maintenance
organization or a limited health | 12 |
| service organization, $2,000.
| 13 |
| (bb) For filing a statement of acquisition of a foreign | 14 |
| or alien
insurance company as defined in Section 131.12a of | 15 |
| this Code, $1,000.
| 16 |
| (cc) For filing a registration statement as required in | 17 |
| Sections 131.13
and 131.14, the notification as required by | 18 |
| Sections 131.16,
131.20a, or 141.4, or an
agreement or | 19 |
| transaction required by Sections 124.2(2), 141, 141a, or
| 20 |
| 141.1, $200.
| 21 |
| (dd) For filing an application for licensing of:
| 22 |
| (i) a religious or charitable risk pooling trust or | 23 |
| a workers'
compensation pool, $1,000;
| 24 |
| (ii) a workers' compensation service company, | 25 |
| $500;
| 26 |
| (iii) a self-insured automobile fleet, $200; or
| 27 |
| (iv) a renewal of or amendment of any license | 28 |
| issued pursuant to (i),
(ii), or (iii) above, $100.
| 29 |
| (ee) For filing articles of incorporation for a | 30 |
| syndicate to engage in
the business of insurance through | 31 |
| the Illinois Insurance Exchange, $2,000.
| 32 |
| (ff) For filing amended articles of incorporation for a | 33 |
| syndicate engaged
in the business of insurance through the | 34 |
| Illinois Insurance Exchange, $100.
| 35 |
| (gg) For filing articles of incorporation for a limited | 36 |
| syndicate to
join with other subscribers or limited |
|
|
|
SB2404 Engrossed |
- 21 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| syndicates to do business through
the Illinois Insurance | 2 |
| Exchange, $1,000.
| 3 |
| (hh) For filing amended articles of incorporation for a | 4 |
| limited
syndicate to do business through the Illinois | 5 |
| Insurance Exchange, $100.
| 6 |
| (ii) For a permit to solicit subscriptions to a | 7 |
| syndicate
or limited syndicate, $100.
| 8 |
| (jj) For the filing of each form as required in Section | 9 |
| 143 of this
Code, $50 per form. The fee for advisory and | 10 |
| rating
organizations shall be $200 per form.
| 11 |
| (i) For the purposes of the form filing fee, | 12 |
| filings made on insert page
basis will be considered | 13 |
| one form at the time of its original submission.
| 14 |
| Changes made to a form subsequent to its approval shall | 15 |
| be considered a
new filing.
| 16 |
| (ii) Only one fee shall be charged for a form, | 17 |
| regardless of the number
of other forms or policies | 18 |
| with which it will be used.
| 19 |
| (iii) (Blank).
Fees charged for a policy filed as | 20 |
| it will be issued regardless of
the number of forms | 21 |
| comprising that policy shall not exceed $1,000
or | 22 |
| $2,000
for advisory or rating organizations.
| 23 |
| (iv) The Director may by rule exempt forms from | 24 |
| such fees.
| 25 |
| (kk) For filing an application for licensing of a | 26 |
| reinsurance
intermediary, $500.
| 27 |
| (ll) For filing an application for renewal of a license | 28 |
| of a reinsurance
intermediary, $200.
| 29 |
| (2) When printed copies or numerous copies of the same | 30 |
| paper or records
are furnished or certified, the Director may | 31 |
| reduce such fees for copies
if he finds them excessive. He may, | 32 |
| when he considers it in the public
interest, furnish without | 33 |
| charge to state insurance departments and persons
other than | 34 |
| companies, copies or certified copies of reports of | 35 |
| examinations
and of other papers and records.
| 36 |
| (3) The expenses incurred in any performance
examination |
|
|
|
SB2404 Engrossed |
- 22 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| authorized by law shall be paid by the company or person being
| 2 |
| examined. The charge shall be reasonably related to the cost of | 3 |
| the
examination including but not limited to compensation of | 4 |
| examiners,
electronic data processing costs, supervision and | 5 |
| preparation of an
examination report and lodging and travel | 6 |
| expenses.
All lodging and travel expenses shall be in accord
| 7 |
| with the applicable travel regulations as published by the | 8 |
| Department of
Central Management Services and approved by the | 9 |
| Governor's Travel Control
Board, except that out-of-state | 10 |
| lodging and travel expenses related to
examinations authorized | 11 |
| under Section 132 shall be in accordance with
travel rates | 12 |
| prescribed under paragraph 301-7.2 of the Federal Travel
| 13 |
| Regulations, 41 C.F.R. 301-7.2, for reimbursement of | 14 |
| subsistence expenses
incurred during official travel. All | 15 |
| lodging and travel expenses may be reimbursed directly upon | 16 |
| authorization of the
Director. With the exception of the
direct | 17 |
| reimbursements authorized by the
Director, all performance | 18 |
| examination charges collected by the
Department shall be paid
| 19 |
| to the Insurance Producers Administration Fund,
however, the | 20 |
| electronic data processing costs
incurred by the Department in | 21 |
| the performance of any examination shall be
billed directly to | 22 |
| the company being examined for payment to the
Statistical | 23 |
| Services Revolving Fund.
| 24 |
| (4) At the time of any service of process on the Director
| 25 |
| as attorney for such service, the Director shall charge and | 26 |
| collect the
sum of $20, which may be recovered as taxable costs | 27 |
| by
the party to the suit or action causing such service to be | 28 |
| made if he prevails
in such suit or action.
| 29 |
| (5) (a) The costs incurred by the Department of Insurance
| 30 |
| in conducting any hearing authorized by law shall be assessed | 31 |
| against the
parties to the hearing in such proportion as the | 32 |
| Director of Insurance may
determine upon consideration of all | 33 |
| relevant circumstances including: (1)
the nature of the | 34 |
| hearing; (2) whether the hearing was instigated by, or
for the | 35 |
| benefit of a particular party or parties; (3) whether there is | 36 |
| a
successful party on the merits of the proceeding; and (4) the |
|
|
|
SB2404 Engrossed |
- 23 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| relative levels
of participation by the parties.
| 2 |
| (b) For purposes of this subsection (5) costs incurred | 3 |
| shall
mean the hearing officer fees, court reporter fees, and | 4 |
| travel expenses
of Department of Insurance officers and | 5 |
| employees; provided however, that
costs incurred shall not | 6 |
| include hearing officer fees or court reporter
fees unless the | 7 |
| Department has retained the services of independent
| 8 |
| contractors or outside experts to perform such functions.
| 9 |
| (c) The Director shall make the assessment of costs | 10 |
| incurred as part of
the final order or decision arising out of | 11 |
| the proceeding; provided, however,
that such order or decision | 12 |
| shall include findings and conclusions in support
of the | 13 |
| assessment of costs. This subsection (5) shall not be construed | 14 |
| as
permitting the payment of travel expenses unless calculated | 15 |
| in accordance
with the applicable travel regulations of the | 16 |
| Department
of Central Management Services, as approved by the | 17 |
| Governor's Travel Control
Board. The Director as part of such | 18 |
| order or decision shall require all
assessments for hearing | 19 |
| officer fees and court reporter fees, if any, to
be paid | 20 |
| directly to the hearing officer or court reporter by the | 21 |
| party(s)
assessed for such costs. The assessments for travel | 22 |
| expenses of Department
officers and employees shall be | 23 |
| reimbursable to the
Director of Insurance for
deposit to the | 24 |
| fund out of which those expenses had been paid.
| 25 |
| (d) The provisions of this subsection (5) shall apply in | 26 |
| the case of any
hearing conducted by the Director of Insurance | 27 |
| not otherwise specifically
provided for by law.
| 28 |
| (6) The Director shall charge and collect an annual | 29 |
| financial
regulation fee from every domestic company for | 30 |
| examination and analysis of
its financial condition and to fund | 31 |
| the internal costs and expenses of the
Interstate Insurance | 32 |
| Receivership Commission as may be allocated to the State
of | 33 |
| Illinois and companies doing an insurance business in this | 34 |
| State pursuant to
Article X of the Interstate Insurance | 35 |
| Receivership Compact. The fee shall be
the greater fixed amount | 36 |
| based upon
the combination of nationwide direct premium income |
|
|
|
SB2404 Engrossed |
- 24 - |
LRB093 20536 SAS 46343 b |
|
| 1 |
| and
nationwide reinsurance
assumed premium
income or upon | 2 |
| admitted assets calculated under this subsection as follows:
| 3 |
| (a) Combination of nationwide direct premium income | 4 |
| and
nationwide reinsurance assumed premium.
| 5 |
| (i) $150, if the premium is less than $500,000 and | 6 |
| there is
no
reinsurance assumed premium;
| 7 |
| (ii) $750, if the premium is $500,000 or more, but | 8 |
| less
than $5,000,000
and there is no reinsurance | 9 |
| assumed premium; or if the premium is less than
| 10 |
| $5,000,000 and the reinsurance assumed premium is less | 11 |
| than $10,000,000;
| 12 |
| (iii) $3,750, if the premium is less than | 13 |
| $5,000,000 and
the reinsurance
assumed premium is | 14 |
| $10,000,000 or more;
| 15 |
| (iv) $7,500, if the premium is $5,000,000 or more, | 16 |
| but
less than
$10,000,000;
| 17 |
| (v) $18,000, if the premium is $10,000,000 or more, | 18 |
| but
less than $25,000,000;
| 19 |
| (vi) $22,500, if the premium is $25,000,000 or | 20 |
| more, but
less
than $50,000,000;
| 21 |
| (vii) $30,000, if the premium is $50,000,000 or | 22 |
| more,
but less than $100,000,000;
| 23 |
| (viii) $37,500, if the premium is $100,000,000 or | 24 |
| more.
| 25 |
| (b) Admitted assets.
| 26 |
| (i) $150, if admitted assets are less than | 27 |
| $1,000,000;
| 28 |
| (ii) $750, if admitted assets are $1,000,000 or | 29 |
| more, but
less than
$5,000,000;
| 30 |
| (iii) $3,750, if admitted assets are $5,000,000 or | 31 |
| more,
but less than
$25,000,000;
| 32 |
| (iv) $7,500, if admitted assets are $25,000,000 or | 33 |
| more,
but less than
$50,000,000;
| 34 |
| (v) $18,000, if admitted assets are $50,000,000 or | 35 |
| more,
but less than
$100,000,000;
| 36 |
| (vi) $22,500, if admitted assets are $100,000,000 |
|
|
|
SB2404 Engrossed |
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LRB093 20536 SAS 46343 b |
|
| 1 |
| or
more, but less
than $500,000,000;
| 2 |
| (vii) $30,000, if admitted assets are $500,000,000 | 3 |
| or
more, but less
than $1,000,000,000;
| 4 |
| (viii) $37,500, if admitted assets are | 5 |
| $1,000,000,000
or more.
| 6 |
| (c) The sum of financial regulation fees charged to the | 7 |
| domestic
companies of the same affiliated group shall not | 8 |
| exceed $250,000
in the aggregate in any single year and | 9 |
| shall be billed by the Director to
the member company | 10 |
| designated by the
group.
| 11 |
| (7) The Director shall charge and collect an annual | 12 |
| financial regulation
fee from every foreign or alien company, | 13 |
| except fraternal benefit
societies, for the
examination and | 14 |
| analysis of its financial condition and to fund the internal
| 15 |
| costs and expenses of the Interstate Insurance Receivership | 16 |
| Commission as may
be allocated to the State of Illinois and | 17 |
| companies doing an insurance business
in this State pursuant to | 18 |
| Article X of the Interstate Insurance Receivership
Compact.
The | 19 |
| fee shall be a fixed amount based upon Illinois direct premium | 20 |
| income
and nationwide reinsurance assumed premium income in | 21 |
| accordance with the
following schedule:
| 22 |
| (a) $150, if the premium is less than $500,000 and | 23 |
| there is
no
reinsurance assumed premium;
| 24 |
| (b) $750, if the premium is $500,000 or more, but less | 25 |
| than
$5,000,000
and there is no reinsurance assumed | 26 |
| premium;
or if the premium is less than $5,000,000 and the | 27 |
| reinsurance assumed
premium is less than $10,000,000;
| 28 |
| (c) $3,750, if the premium is less than $5,000,000 and | 29 |
| the
reinsurance
assumed premium is $10,000,000 or more;
| 30 |
| (d) $7,500, if the premium is $5,000,000 or more, but | 31 |
| less
than
$10,000,000;
| 32 |
| (e) $18,000, if the premium is $10,000,000 or more, but
| 33 |
| less than
$25,000,000;
| 34 |
| (f) $22,500, if the premium is $25,000,000 or more, but
| 35 |
| less than
$50,000,000;
| 36 |
| (g) $30,000, if the premium is $50,000,000 or more, but
|
|
|
|
SB2404 Engrossed |
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LRB093 20536 SAS 46343 b |
|
| 1 |
| less than
$100,000,000;
| 2 |
| (h) $37,500, if the premium is $100,000,000 or more.
| 3 |
| The sum of financial regulation fees under this subsection | 4 |
| (7)
charged to the foreign or alien companies within the same | 5 |
| affiliated group
shall not exceed $250,000 in the aggregate in | 6 |
| any single year
and shall be
billed by the Director to the | 7 |
| member company designated by the group.
| 8 |
| (8) Beginning January 1, 1992, the financial regulation | 9 |
| fees imposed
under subsections (6) and (7)
of this Section | 10 |
| shall be paid by each company or domestic affiliated group
| 11 |
| annually. After January
1, 1994, the fee shall be billed by | 12 |
| Department invoice
based upon the company's
premium income or | 13 |
| admitted assets as shown in its annual statement for the
| 14 |
| preceding calendar year. The invoice is due upon
receipt and | 15 |
| must be paid no later than June 30 of each calendar year. All
| 16 |
| financial
regulation fees collected by the Department shall be | 17 |
| paid to the Insurance
Financial Regulation Fund. The Department | 18 |
| may not collect financial
examiner per diem charges from | 19 |
| companies subject to subsections (6) and (7)
of this Section | 20 |
| undergoing financial examination
after June 30, 1992.
| 21 |
| (9) In addition to the financial regulation fee required by | 22 |
| this
Section, a company undergoing any financial examination | 23 |
| authorized by law
shall pay the following costs and expenses | 24 |
| incurred by the Department:
electronic data processing costs, | 25 |
| the expenses authorized under Section 131.21
and
subsection (d) | 26 |
| of Section 132.4 of this Code, and lodging and travel expenses.
| 27 |
| Electronic data processing costs incurred by the | 28 |
| Department in the
performance of any examination shall be | 29 |
| billed directly to the company
undergoing examination for | 30 |
| payment to the Statistical Services Revolving
Fund. Except for | 31 |
| direct reimbursements authorized by the Director or
direct | 32 |
| payments made under Section 131.21 or subsection (d) of Section
| 33 |
| 132.4 of this Code, all financial regulation fees and all | 34 |
| financial
examination charges collected by the Department | 35 |
| shall be paid to the
Insurance Financial Regulation Fund.
| 36 |
| All lodging and travel expenses shall be in accordance with |
|
|
|
SB2404 Engrossed |
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LRB093 20536 SAS 46343 b |
|
| 1 |
| applicable
travel regulations published by the Department of | 2 |
| Central Management
Services and approved by the Governor's | 3 |
| Travel Control Board, except that
out-of-state lodging and | 4 |
| travel expenses related to examinations authorized
under | 5 |
| Sections 132.1 through 132.7 shall be in accordance
with travel | 6 |
| rates prescribed
under paragraph 301-7.2 of the Federal Travel | 7 |
| Regulations, 41 C.F.R. 301-7.2,
for reimbursement of | 8 |
| subsistence expenses incurred during official travel.
All | 9 |
| lodging and travel expenses may be
reimbursed directly upon the | 10 |
| authorization of the Director.
| 11 |
| In the case of an organization or person not subject to the | 12 |
| financial
regulation fee, the expenses incurred in any | 13 |
| financial examination authorized
by law shall be paid by the | 14 |
| organization or person being examined. The charge
shall be | 15 |
| reasonably related to the cost of the examination including, | 16 |
| but not
limited to, compensation of examiners and other costs | 17 |
| described in this
subsection.
| 18 |
| (10) Any company, person, or entity failing to make any | 19 |
| payment of $150
or more as required under this Section shall be | 20 |
| subject to the penalty and
interest provisions provided for in | 21 |
| subsections (4) and (7)
of Section 412.
| 22 |
| (11) Unless otherwise specified, all of the fees collected | 23 |
| under this
Section shall be paid into the Insurance Financial | 24 |
| Regulation Fund.
| 25 |
| (12) For purposes of this Section:
| 26 |
| (a) "Domestic company" means a company as defined in | 27 |
| Section 2 of this
Code which is incorporated or organized | 28 |
| under the laws of this State, and in
addition includes a | 29 |
| not-for-profit corporation authorized under the Dental
| 30 |
| Service Plan Act or the Voluntary Health
Services Plans | 31 |
| Act, a health maintenance organization, and a
limited
| 32 |
| health service organization.
| 33 |
| (b) "Foreign company" means a company as defined in | 34 |
| Section 2 of this
Code which is incorporated or organized | 35 |
| under the laws of any state of the
United States other than | 36 |
| this State and in addition includes a health
maintenance |
|
|
|
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LRB093 20536 SAS 46343 b |
|
| 1 |
| organization and a limited health service organization | 2 |
| which is
incorporated or organized under the laws
of any | 3 |
| state of the United States other than this State.
| 4 |
| (c) "Alien company" means a company as defined in | 5 |
| Section 2 of this Code
which is incorporated or organized | 6 |
| under the laws of any country other than
the United States.
| 7 |
| (d) "Fraternal benefit society" means a corporation, | 8 |
| society, order,
lodge or voluntary association as defined | 9 |
| in Section 282.1 of this
Code.
| 10 |
| (e) "Mutual benefit association" means a company, | 11 |
| association or
corporation authorized by the Director to do | 12 |
| business in this State under
the provisions of Article | 13 |
| XVIII of this Code.
| 14 |
| (f) "Burial society" means a person, firm, | 15 |
| corporation, society or
association of individuals | 16 |
| authorized by the Director to do business in
this State | 17 |
| under the provisions of Article XIX of this Code.
| 18 |
| (g) "Farm mutual" means a district, county and township | 19 |
| mutual insurance
company authorized by the Director to do | 20 |
| business in this State under the
provisions of the Farm | 21 |
| Mutual Insurance Company Act of 1986.
| 22 |
| (Source: P.A. 93-32, eff. 7-1-03.)
| 23 |
| Section 99. Effective date. This Act takes effect upon | 24 |
| becoming law, except the provisions changing Section 229.4 of | 25 |
| and adding Section 229.4a to the Illinois Insurance Code take | 26 |
| effect on July 1, 2004.
|
|