Full Text of HB0982 98th General Assembly
HB0982enr 98TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning insurance.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Insurance Code is amended by | 5 | | changing Section 245.21 as follows:
| 6 | | (215 ILCS 5/245.21) (from Ch. 73, par. 857.21)
| 7 | | Sec. 245.21.
Establishment of separate accounts by | 8 | | domestic companies
organized to do a life, annuity, or accident | 9 | | and health insurance business. A
domestic company, including | 10 | | for the purposes of this
Article all domestic fraternal benefit
| 11 | | societies, may, for authorized
classes of insurance, establish | 12 | | one or more
separate accounts, and may allocate thereto amounts | 13 | | (including without
limitation proceeds applied under optional | 14 | | modes of settlement or under
dividend options) to provide for | 15 | | life, annuity, or accident and health
insurance (and benefits
| 16 | | incidental thereto), payable in fixed or variable amounts or | 17 | | both, subject
to the following:
| 18 | | (1) The income, gains and losses, realized or unrealized, | 19 | | from
assets allocated to a separate account must be credited to | 20 | | or charged
against the account, without regard to other income, | 21 | | gains or losses of
the company.
| 22 | | (2) Except as may be provided with respect to reserves for
| 23 | | guaranteed benefits and funds referred to in paragraph (3) of |
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| 1 | | this
Section (i) amounts allocated to any separate account and | 2 | | accumulations
thereon may be invested and reinvested without | 3 | | regard to any requirements
or limitations of Part 2 or Part 3 | 4 | | of Article VIII of this Code and (ii) the
investments in any | 5 | | separate account or accounts may not be taken into
account in | 6 | | applying the investment limitations otherwise applicable to | 7 | | the
investments of the company.
| 8 | | (3) Except with the approval of the Director and under the
| 9 | | conditions as to investments and other matters as the Director | 10 | | may
prescribe,
that must recognize the guaranteed nature of the | 11 | | benefits provided,
reserves for (i) benefits guaranteed as to | 12 | | dollar amount and duration
and (ii) funds guaranteed as to | 13 | | principal amount or stated rate of
interest may not be | 14 | | maintained in a separate account.
| 15 | | (4) Unless otherwise approved by the Director, assets | 16 | | allocated to a
separate account must be valued at their market | 17 | | value on the date of
valuation, or if there is no readily | 18 | | available market, then as provided
in the contract or the rules | 19 | | or other written agreement applicable to
the separate account. | 20 | | Unless otherwise approved by the Director, the
portion, if any, | 21 | | of the assets of the separate account equal to the
company's | 22 | | reserve liability with regard to the guaranteed benefits and
| 23 | | funds referred to in paragraph (3) of this Section must be | 24 | | valued in
accordance with the rules otherwise applicable to the | 25 | | company's assets.
| 26 | | (5) Amounts allocated to a separate account under this |
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| 1 | | Article are
owned by the company, and the company may not be, | 2 | | nor hold itself out to
be, a trustee with respect to those | 3 | | amounts. The assets of any
separate account equal to the | 4 | | reserves and other contract liabilities
with respect to the | 5 | | account may not be charged with liabilities arising
out of any | 6 | | other business the company may conduct , unless the separate | 7 | | account is subject to guarantees, in which case the assets | 8 | | shall be charged with liabilities arising out of other business | 9 | | of the company, unless the contract specifies that the assets | 10 | | are insulated .
| 11 | | (6) No sale, exchange or other transfer of assets may be | 12 | | made by a
company between any of its separate accounts or | 13 | | between any other
investment account and one or more of its | 14 | | separate accounts unless, in
case of a transfer into a separate | 15 | | account, the transfer is made solely
to establish the account | 16 | | or to support the operation of the contracts
with respect to | 17 | | the separate account to which the transfer is made, and
unless | 18 | | the transfer, whether into or from a separate account, is made
| 19 | | (i) by a transfer of cash, or (ii) by a transfer of securities | 20 | | having a
readily determinable market value, if the transfer of | 21 | | securities is
approved by the Director. The Director may | 22 | | approve other transfers among
those accounts if, in his or her | 23 | | opinion, the transfers would not be
inequitable.
| 24 | | (7) To the extent a company considers it necessary to | 25 | | comply with
any applicable federal or state laws, the company, | 26 | | with respect to any
separate account, including without |
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| 1 | | limitation any separate account
which is a management | 2 | | investment company or a unit investment trust, may
provide for | 3 | | persons having an interest therein appropriate voting and
other | 4 | | rights and special procedures for the conduct of the business | 5 | | of
the account, including without limitation special rights and | 6 | | procedures
relating to investment policy, investment advisory | 7 | | services, selection
of independent public accountants, and the | 8 | | selection of a committee, the
members of which need not be | 9 | | otherwise affiliated with the company, to
manage the business | 10 | | of the account.
| 11 | | (Source: P.A. 90-381, eff. 8-14-97; 90-418, eff. 8-15-97;
| 12 | | 90-655, eff. 7-30-98.)
| 13 | | Section 99. Effective date. This Act takes effect upon | 14 | | becoming law.
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