Full Text of SB1782 99th General Assembly
SB1782enr 99TH 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 Sections 537.4 and 546 as follows:
| 6 | | (215 ILCS 5/537.4) (from Ch. 73, par. 1065.87-4)
| 7 | | Sec. 537.4. Fund assumes obligations of insolvent | 8 | | companies. The Fund
shall be deemed the insolvent company to | 9 | | the extent
of the Fund's obligation for covered claims and to | 10 | | such extent
shall have all
rights, duties, and obligations of | 11 | | the insolvent company, subject to the
limitations provided in | 12 | | this Article, as if the company had not become
insolvent, with | 13 | | the
exception that the liquidator shall retain the sole right
| 14 | | to recover any reinsurance proceeds.
The Fund's rights under | 15 | | this Section include, but are not limited to, the
right to | 16 | | pursue and retain salvage and subrogation recoveries on paid | 17 | | covered
claim obligations to the extent paid by the Fund. The | 18 | | extent of the Fund's subrogation rights and any other rights of | 19 | | reimbursement with respect to its covered claims payments shall | 20 | | not be limited as if the Fund were the insolvent company, but | 21 | | shall be determined independently by taking into account the | 22 | | Fund's rights under Section 546 of this Article.
| 23 | | (Source: P.A. 89-97, eff. 7-7-95.)
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| 1 | | (215 ILCS 5/546) (from Ch. 73, par. 1065.96)
| 2 | | Sec. 546. Other insurance.
| 3 | | (a) An insured or claimant shall be required first to | 4 | | exhaust all
coverage provided by any other insurance policy, | 5 | | regardless of whether or not
such other insurance policy was | 6 | | written by a member company, if the claim under
such other | 7 | | policy arises from the same facts, injury, or loss that gave | 8 | | rise to
the covered claim against the Fund. The Fund's | 9 | | obligation under Section 537.2
shall be reduced by the amount | 10 | | recovered or recoverable, whichever is greater,
under such | 11 | | other insurance policy. Where such other insurance policy | 12 | | provides
uninsured
or underinsured motorist coverage, the | 13 | | amount recoverable shall be deemed to be
the full applicable | 14 | | limits of such coverage. To the extent that the Fund's
| 15 | | obligation under Section 537.2 is reduced by application of | 16 | | this Section, the
liability of the person insured by the | 17 | | insolvent insurer's policy for the claim
shall be reduced in | 18 | | the same amount. If the Fund pays a covered claim without the | 19 | | exhaustion of all other coverage that could have been exhausted | 20 | | under this Section, the Fund shall have an independent right of | 21 | | recovery against each insurer whose coverage was not exhausted | 22 | | in the amount the Fund would not have had to pay if that | 23 | | insurer's coverage had been exhausted first.
| 24 | | (b) Any insured or claimant having a claim which may be | 25 | | recovered under more
than one insurance guaranty fund or its |
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| 1 | | equivalent shall seek recovery
first from the Fund of the place | 2 | | of residence of the insured except that
if it is a first party | 3 | | claim for damage to property with a permanent
location, he | 4 | | shall first seek recovery from the Fund of the location of
the | 5 | | property; if it is a workers' compensation claim, he shall | 6 | | first
seek recovery from the Fund of the residence of the | 7 | | claimant. Any
recovery under this Article shall be reduced by | 8 | | the amount of the
recovery from any other insurance guaranty | 9 | | fund or its equivalent.
| 10 | | (Source: P.A. 89-97, eff. 7-7-95; 90-499, eff. 8-19-97.)
| 11 | | Section 98. Applicability. This amendatory Act applies to | 12 | | pending actions as well as actions commenced on or after the | 13 | | effective date of this amendatory Act of the 99th General | 14 | | Assembly.
| 15 | | Section 99. Effective date. This Act takes effect upon | 16 | | becoming law.
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