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| | 98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014 SB1873 Introduced 2/15/2013, by Sen. John G. Mulroe SYNOPSIS AS INTRODUCED: |
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Amends the Illinois Insurance Code. Makes changes concerning the provisions of the Code to which group workers' compensation pools are subject. Deletes certain provisions concerning the Group Workers' Compensation Pool
Insolvency Fund. Provides that all qualified group workers' compensation pools shall be a member company, as defined in the Code. Provides that beginning in 2013, the maximum amount all qualified group workers' compensation pools may be assessed as a member company shall be 0.5% of that member company's net direct written premium on the kinds of insurance in the account for the calendar year preceding the assessment; thereafter, until 2016, the maximum amount all qualified group workers' compensation pools may be assessed as a member company shall annually increase by 0.5% of that member company's net direct written premium on the kinds of insurance in the account for the calendar year preceding the assessment until the maximum assessment amount is equal to 2% of that member company's net direct written premium. Provides that after 2016, all qualified group workers' compensation pools shall be assessed at the same percentage as any other member company. Provides that on the effective
date of the amendatory Act, all moneys in the
Group Workers' Compensation Pool Insolvency Fund shall be transferred into the Illinois Insurance Guaranty Fund. Provides that all liabilities whenever occurred of the Group Workers' Compensation Pool Insolvency Fund are to be assumed by the Illinois Insurance Guaranty Fund. Provides that no group workers' compensation pool shall be issued a certificate of authority after the effective date of the amendatory Act. Repeals provisions concerning the standards for issuing and maintaining pool certificates of authority and group workers' compensation pools assessments. Makes other changes. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
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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 Sections 107a.04, 107a.05, 107a.13, and 534.4 and by |
6 | | adding Section 107a.16 as follows:
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7 | | (215 ILCS 5/107a.04)
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8 | | Sec. 107a.04. Organization under the Illinois Insurance |
9 | | Code.
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10 | | (a) After December 31, 2000, group workers' compensation |
11 | | pools shall for the
purpose of
this Article, and this Article |
12 | | only, be considered as though they were
assessable domestic |
13 | | mutual
insurance companies and subject to the following:
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14 | | (1) Article XII 1/2, Article XIII, Article XIII 1/2, |
15 | | Article XXIV , Article XXXIV ;
and
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16 | | (2) Sections 126.2, 126.4, 126.7, 132, 132.1 through |
17 | | 132.7, 133, 134, 137,
139,
140,
141.1, 141.2,
142, 143, |
18 | | 143c, 147, 148, 149, 154.5, 154.6, 154.7, 154.8, 155.01, |
19 | | 155.04,
173.1, 173.2, 173.3,
173.4, 173.5, 174, 174.1, 175, |
20 | | 176, 178, 179b, 186.1, 187, 221.1, 378, 379.1, 401, 408, |
21 | | 408.3, 449,
456, 457, and 458, and 532,
subsections A, B, |
22 | | C, and E of Section 126.5, subsection A of Section 126.6, |
23 | | and
subsections (1) and (7) of
Section 412 of this Code.
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1 | | (b) If there is a conflict between any Section of this |
2 | | Article and any
other Section of this
Code, then the provisions |
3 | | of this Article shall apply.
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4 | | (c) No other provision of this Code shall be applicable to |
5 | | any qualified
workers'
compensation group workers' |
6 | | compensation pool except as provided in this
Article.
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7 | | (d) A certificate of authority that is in effect on the |
8 | | effective date of
this amendatory Act of the 91st General |
9 | | Assembly and that was issued pursuant
to Section 4a of the |
10 | | Workers' Compensation Act or Section 4a of the Workers'
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11 | | Occupational Diseases Act to a group self-insurer
shall remain |
12 | | in effect under this Article. Such group self-insurer
shall |
13 | | then be deemed to be a qualified group workers' compensation |
14 | | pool and
shall be
subject to this Article.
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15 | | (Source: P.A. 91-757, eff. 1-1-01.)
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16 | | (215 ILCS 5/107a.05)
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17 | | Sec. 107a.05. Definitions and interchangeable terms.
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18 | | (a) Unless otherwise provided, the following definitions |
19 | | shall apply:
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20 | | "Authorized insurer" means an insurer licensed in this |
21 | | State to
transact business as described
in Clauses (c) and (d) |
22 | | of Class 2 of Section 4 of this Code.
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23 | | "Calendar Quarter" means the 3-month periods ending March |
24 | | 31, June 30,
September 30,
and December 31.
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25 | | "Director" means the Director of Insurance.
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1 | | "Engaged actively in the business" means a bona fide |
2 | | business concern having
conducted
commerce, trade, or industry |
3 | | in this State for a specified period of time. Any
and all |
4 | | records relating
to this requirement shall be open to |
5 | | inspection by the Director or his designee
during normal
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6 | | business hours.
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7 | | "Gross annual payroll" means payroll for the preceding |
8 | | fiscal year.
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9 | | "Independent actuarial opinion" means an opinion expressed |
10 | | by a member of the
American
Academy of Actuaries or Casualty |
11 | | Actuarial Society.
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12 | | "Independent CPA" means an independent certified public |
13 | | accountant or
independent
certified public accounting firm in |
14 | | good standing and licensed to practice by
the Department of
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15 | | Professional
Regulation.
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16 | | "Net direct written premium" means direct gross premium or |
17 | | contribution, without regard to how it is labeled, written in |
18 | | this State on pooling agreements to which Article XXXIV of this |
19 | | Code applies, less return premiums thereon and dividends paid |
20 | | or credited to members of a group workers' compensation pool on |
21 | | such direct business. |
22 | | "Pool" means a qualified group workers' compensation pool |
23 | | as authorized by
this Article.
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24 | | "Qualified group workers' compensation pool" means a group |
25 | | workers'
compensation pool
that has received a certificate of |
26 | | authority pursuant to this Article.
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1 | | (b) For purposes of incorporating the provisions of this |
2 | | Code designated in
paragraphs (1)
and (2) of subsection (a) of |
3 | | Section 107a.04 into this Article, the following
terms shall be
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4 | | interchangeable:
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5 | | "Contribution" shall be considered premium.
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6 | | "Pooling agreement" shall be considered a policy of |
7 | | insurance.
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8 | | "Trustees of a group workers' compensation pool" shall be |
9 | | considered as
though they were
directors of a domestic mutual |
10 | | insurance company.
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11 | | (Source: P.A. 91-757, eff. 1-1-01.)
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12 | | (215 ILCS 5/107a.13)
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13 | | Sec. 107a.13. Group Workers' Compensation Pool Insolvency |
14 | | Fund and the Illinois Insurance Guaranty Fund .
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15 | | (a) All qualified group workers' compensation pools shall |
16 | | be a member company, as defined in Section 534.5 of this Code. |
17 | | Beginning in 2013, the maximum amount all qualified group |
18 | | workers' compensation pools may be assessed as a member company |
19 | | shall be 0.5% of that member company's net direct written |
20 | | premium on the kinds of insurance in the account as described |
21 | | in item (b) of Section 535 of this Code for the calendar year |
22 | | preceding the assessment. Thereafter, until 2016, the maximum |
23 | | amount all qualified group workers' compensation pools may be |
24 | | assessed as a member company shall annually increase by 0.5% of |
25 | | that member company's net direct written premium on the kinds |
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1 | | of insurance in the account as described in item (b) of Section |
2 | | 535 of this Code for the calendar year preceding the assessment |
3 | | until the maximum assessment amount is equal to 2% of that |
4 | | member company's net direct written premium. After 2016, all |
5 | | qualified group workers' compensation pools shall be assessed |
6 | | at the same percentage as any other member company. Nothing in |
7 | | this Section shall limit the General Assembly's ability to |
8 | | increase the amount or percentage of the assessment that member |
9 | | companies shall pay. On the effective
date of this amendatory |
10 | | Act of the 98th General Assembly, all moneys in the
Group |
11 | | Workers' Compensation Pool Insolvency Fund shall be |
12 | | transferred into the Illinois Insurance Guaranty Fund. All |
13 | | liabilities whenever occurred of the Group Workers' |
14 | | Compensation Pool Insolvency Fund are to be assumed by the |
15 | | Illinois Insurance Guaranty Fund. pay a sum equal to
0.5% of
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16 | | all
compensation and medical service payments made under either |
17 | | the Workers'
Compensation Act or the
Workers'
Occupational |
18 | | Diseases Act during the 6 months immediately preceding the date |
19 | | of
payment, into
the Group Workers' Compensation Pool |
20 | | Insolvency Fund, the successor fund to the
Group Self-Insurers' |
21 | | Insolvency Fund. On the effective
date of this amendatory Act |
22 | | of the 91st General Assembly, all moneys in the
Group |
23 | | Self-Insurers' Insolvency Fund shall be transferred into the |
24 | | Group
Workers' Compensation Pool Insolvency Fund.
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25 | | (b) (Blank). The State Treasurer is ex-officio custodian of |
26 | | the Group Workers'
Compensation Pool
Insolvency Fund. Moneys in |
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1 | | the Fund shall be deposited the same as are State
funds and any |
2 | | interest
accruing on moneys in the Fund shall be added to the |
3 | | Fund every 6 months. The
Fund shall be
subject to audit the |
4 | | same as State funds and accounts and shall be protected by
the |
5 | | general bond
given by the State Treasurer. The Fund shall be |
6 | | considered always appropriated
for the purposes of
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7 | | compensating employees who are eligible to receive benefits |
8 | | from their
employers pursuant to the
provisions of the Workers' |
9 | | Compensation Act or Workers' Occupational Diseases
Act when |
10 | | their
employer is a member of a qualified group workers' |
11 | | compensation pool and the
qualified group
workers' |
12 | | compensation
pool has become unable to pay compensation and |
13 | | medical service payments due to
financial insolvency either
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14 | | prior to or following
the date of award. Moneys in the Fund may |
15 | | be used to compensate any type of
injury or occupational
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16 | | disease that is compensable under either the Workers' |
17 | | Compensation Act or the
Workers'
Occupational Diseases Act. The |
18 | | State Treasurer shall be joined with the
qualified group
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19 | | workers'
compensation pool as party respondent in any claim or |
20 | | application for
adjustment of claim filed
against a qualified |
21 | | group workers' compensation pool whenever the compensation
and
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22 | | medical services
provided pursuant to this Article may be |
23 | | unpaid by reason of default of an
insolvent qualified group |
24 | | workers'
compensation pool.
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25 | | (c) (Blank). Payment shall be made out of the Group |
26 | | Workers' Compensation Pool
Insolvency Fund
only upon order of |
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1 | | the Director and only after the penal sum of the fidelity
bond |
2 | | and securities, if any, has
been exhausted. It shall be the |
3 | | obligation of a qualified group workers'
compensation
pool or |
4 | | its successor to
make arrangements to repay the Group Workers' |
5 | | Compensation Pool Insolvency Fund
for all
moneys paid out in |
6 | | its behalf. The Director is authorized to make arrangements
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7 | | with the qualified group
workers' compensation pool as to terms |
8 | | of repayment. The obligations of
qualified group
workers'
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9 | | compensation pools to make contributions to the Group Workers' |
10 | | Compensation
Pool Insolvency
Fund shall be waived on any |
11 | | January 1 or July 1, if the Fund has a positive
balance of at |
12 | | least
$2,000,000 on the date one month prior to the date of |
13 | | payment.
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14 | | (Source: P.A. 91-757, eff. 1-1-01.)
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15 | | (215 ILCS 5/107a.16 new) |
16 | | Sec. 107a.16. New group workers' compensation pool |
17 | | prohibited. No group workers' compensation pool shall be issued |
18 | | a certificate of authority by the Director after the effective |
19 | | date of this amendatory Act of the 98th General Assembly.
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20 | | (215 ILCS 5/534.4) (from Ch. 73, par. 1065.84-4)
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21 | | Sec. 534.4.
"Insolvent company" means a company
organized |
22 | | as a stock company, mutual company, reciprocal , qualified group |
23 | | workers' compensation pool, or Lloyds (a)
which holds a |
24 | | certificate of authority to transact insurance
in this State |
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1 | | either at the time the policy was issued or when
the insured |
2 | | event occurred, or any company which has assumed
such policy |
3 | | obligation through merger, consolidation or
reinsurance, |
4 | | whether or not such assuming company held a
certificate of |
5 | | authority to transact insurance in this State
at the time such |
6 | | policy was issued or when the insured event occurred; and (b)
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7 | | against which a final Order of Liquidation with a finding of
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8 | | insolvency to which there is no further right of appeal has |
9 | | been entered by
a court of competent jurisdiction in the |
10 | | company's State of domicile after the
effective date of this |
11 | | Article.
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12 | | (Source: P.A. 90-499, eff. 8-19-97.)
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13 | | (215 ILCS 5/107a.07 rep.)
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14 | | (215 ILCS 5/107a.14 rep.) |
15 | | Section 10. The Illinois Insurance Code is amended by |
16 | | repealing Sections 107a.07 and 107a.14.
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17 | | Section 99. Effective date. This Act takes effect upon |
18 | | becoming law.
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INDEX
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Statutes amended in order of appearance
| | 3 | | 215 ILCS 5/107a.04 | | | 4 | | 215 ILCS 5/107a.05 | | | 5 | | 215 ILCS 5/107a.13 | | | 6 | | 215 ILCS 5/107a.16 new | | | 7 | | 215 ILCS 5/534.4 | from Ch. 73, par. 1065.84-4 | | 8 | | 215 ILCS 5/107a.07 rep. | | | 9 | | 215 ILCS 5/107a.14 rep. | |
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