Illinois General Assembly - Full Text of HB0240
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Full Text of HB0240  102nd General Assembly

HB0240 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB0240

 

Introduced 1/29/2021, by Rep. Thaddeus Jones

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/1575
215 ILCS 5/Art. XXXI.75 rep.

    Amends the Illinois Insurance Code. Provides that a public adjuster shall ensure that a contract between a public adjuster and insured contains the email address of the public adjuster. Provides that a public adjuster shall provide the insurer with an exact copy of the contract with the insured by email within 2 business days after execution of the contract. Provides that a public adjuster shall not provide services until a written contract with the insured has been executed and an exact copy of the contract has been provided to the insurer. Provides that, at the option of an insured, any contract between a public adjuster and the insured shall be voidable for 5 business days after the copy of the contract has been received by the insurer. Provides that the insured may void the contract by notifying the public adjuster in writing by sending an email to the email address shown on the contract. Repeals the Public Insurance Adjusters and Registered Firms Article of the Illinois Insurance Code. Effective immediately.


LRB102 05098 BMS 15118 b

 

 

A BILL FOR

 

HB0240LRB102 05098 BMS 15118 b

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 1575 as follows:
 
6    (215 ILCS 5/1575)
7    Sec. 1575. Contract between public adjuster and insured.
8    (a) Public adjusters shall ensure that all contracts for
9their services are in writing and contain the following terms:
10        (1) legible full name of the adjuster signing the
11    contract, as specified in Department records;
12        (2) permanent home state business address, email
13    address, and phone number;
14        (3) license number;
15        (4) title of "Public Adjuster Contract";
16        (5) the insured's full name, street address, insurance
17    company name, and policy number, if known or upon
18    notification;
19        (6) a description of the loss and its location, if
20    applicable;
21        (7) description of services to be provided to the
22    insured;
23        (8) signatures of the public adjuster and the insured;

 

 

HB0240- 2 -LRB102 05098 BMS 15118 b

1        (9) date and time the contract was signed by the
2    public adjuster and date and time the contract was signed
3    by the insured;
4        (10) attestation language stating that the public
5    adjuster is fully bonded pursuant to State law; and
6        (11) full salary, fee, commission, compensation, or
7    other considerations the public adjuster is to receive for
8    services.
9    (b) The contract may specify that the public adjuster
10shall be named as a co-payee on an insurer's payment of a
11claim.
12        (1) If the compensation is based on a share of the
13    insurance settlement, the exact percentage shall be
14    specified.
15        (2) Initial expenses to be reimbursed to the public
16    adjuster from the proceeds of the claim payment shall be
17    specified by type, with dollar estimates set forth in the
18    contract and with any additional expenses first approved
19    by the insured.
20        (3) Compensation provisions in a public adjuster
21    contract shall not be redacted in any copy of the contract
22    provided to the Director.
23    (c) If the insurer, not later than 5 business days after
24the date on which the loss is reported to the insurer, either
25pays or commits in writing to pay to the insured the policy
26limit of the insurance policy, the public adjuster shall:

 

 

HB0240- 3 -LRB102 05098 BMS 15118 b

1        (1) not receive a commission consisting of a
2    percentage of the total amount paid by an insurer to
3    resolve a claim;
4        (2) inform the insured that loss recovery amount might
5    not be increased by insurer; and
6        (3) be entitled only to reasonable compensation from
7    the insured for services provided by the public adjuster
8    on behalf of the insured, based on the time spent on a
9    claim and expenses incurred by the public adjuster, until
10    the claim is paid or the insured receives a written
11    commitment to pay from the insurer.
12    (d) A public adjuster shall provide the insured a written
13disclosure concerning any direct or indirect financial
14interest that the public adjuster has with any other party who
15is involved in any aspect of the claim, other than the salary,
16fee, commission, or other consideration established in the
17written contract with the insured, including, but not limited
18to, any ownership of or any compensation expected to be
19received from, any construction firm, salvage firm, building
20appraisal firm, board-up company, or any other firm that
21provides estimates for work, or that performs any work, in
22conjunction with damages caused by the insured loss on which
23the public adjuster is engaged. The word "firm" shall include
24any corporation, partnership, association, joint-stock
25company, or person.
26    (e) A public adjuster contract may not contain any

 

 

HB0240- 4 -LRB102 05098 BMS 15118 b

1contract term that:
2        (1) allows the public adjuster's percentage fee to be
3    collected when money is due from an insurance company, but
4    not paid, or that allows a public adjuster to collect the
5    entire fee from the first check issued by an insurance
6    company, rather than as a percentage of each check issued
7    by an insurance company;
8        (2) requires the insured to authorize an insurance
9    company to issue a check only in the name of the public
10    adjuster;
11        (3) precludes a public adjuster or an insured from
12    pursuing civil remedies;
13        (4) includes any hold harmless agreement that provides
14    indemnification to the public adjuster by the insured for
15    liability resulting from the public adjuster's negligence;
16    or
17        (5) provides power of attorney by which the public
18    adjuster can act in the place and instead of the insured.
19    (f) The following provisions apply to a contract between a
20public adjuster and an insured:
21        (1) Prior to the signing of the contract, the public
22    adjuster shall provide the insured with a separate signed
23    and dated disclosure document regarding the claim process
24    that states:
25    "Property insurance policies obligate the insured to
26    present a claim to his or her insurance company for

 

 

HB0240- 5 -LRB102 05098 BMS 15118 b

1    consideration. There are 3 types of adjusters that could
2    be involved in that process. The definitions of the 3
3    types are as follows:
4            (A) "Company adjuster" means the insurance
5        adjusters who are employees of an insurance company.
6        They represent the interest of the insurance company
7        and are paid by the insurance company. They will not
8        charge you a fee.
9            (B) "Independent adjuster" means the insurance
10        adjusters who are hired on a contract basis by an
11        insurance company to represent the insurance company's
12        interest in the settlement of the claim. They are paid
13        by your insurance company. They will not charge you a
14        fee.
15            (C) "Public adjuster" means the insurance
16        adjusters who do not work for any insurance company.
17        They work for the insured to assist in the
18        preparation, presentation and settlement of the claim.
19        The insured hires them by signing a contract agreeing
20        to pay them a fee or commission based on a percentage
21        of the settlement, or other method of compensation.".
22        (2) The insured is not required to hire a public
23    adjuster to help the insured meet his or her obligations
24    under the policy, but has the right to do so.
25        (3) The public adjuster is not a representative or
26    employee of the insurer.

 

 

HB0240- 6 -LRB102 05098 BMS 15118 b

1        (4) The salary, fee, commission, or other
2    consideration is the obligation of the insured, not the
3    insurer, except when rights have been assigned to the
4    public adjuster by the insured.
5    (g) The contracts shall be executed in duplicate to
6provide an original contract to the public adjuster, and an
7original contract to the insured. The public adjuster's
8original contract shall be available at all times for
9inspection without notice by the Director.
10    (h) The public adjuster shall provide the insurer with an
11exact copy of the contract with by the insured by email within
122 business days after execution of the contract, authorizing
13the public adjuster to represent the insured's interest.
14    (i) The public adjuster shall give the insured written
15notice of the insured's rights as a consumer under the law of
16this State.
17    (j) A public adjuster shall not provide services until a
18written contract with the insured has been executed, on a form
19filed with and approved by the Director, and an exact copy of
20the contract has been provided to the insurer. At the option of
21the insured, any such contract shall be voidable for 5
22business days after the copy has been received by the insurer
23execution. The insured may void the contract by notifying the
24public adjuster in writing by (i) registered or certified
25mail, return receipt requested, to the address shown on the
26contract, or (ii) personally serving the notice on the public

 

 

HB0240- 7 -LRB102 05098 BMS 15118 b

1adjuster, or (iii) sending an email to the email address shown
2on the contract.
3    (k) If the insured exercises the right to rescind the
4contract, anything of value given by the insured under the
5contract will be returned to the insured within 15 business
6days following the receipt by the public adjuster of the
7cancellation notice.
8(Source: P.A. 96-1332, eff. 1-1-11; 97-333, eff. 8-12-11.)
 
9    (215 ILCS 5/Art. XXXI.75 rep.)
10    Section 10. The Illinois Insurance Code is amended by
11repealing Article XXXI 3/4.
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.