Full Text of SB0765 94th General Assembly
SB0765 94TH GENERAL ASSEMBLY
|
|
|
94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006 SB0765
Introduced 2/18/2005, by Sen. Iris Y. Martinez SYNOPSIS AS INTRODUCED: |
|
215 ILCS 5/500-10 |
|
215 ILCS 5/500-40 |
|
215 ILCS 5/500-106 new |
|
215 ILCS 5/500-135 |
|
|
Amends the Illinois Insurance Code. Provides for the issuance of limited licenses for term life insurance and prohibits a term life licensee from selling any kind of insurance other than term life insurance. Sets forth requirements for a term life limited lines licensee of another state to obtain a license in Illinois and for a term life limited lines licensee in Illinois to obtain a license in another state. Sets forth requirements for applications for a term life limited lines license and provides that a license shall remain in effect so long as fees are paid and education requirements are met. Allows a licensee who allows his or her license to lapse to be issued a new license within 12 months after expiration of the original license upon the payment of a penalty. Sets forth requirements for the information to be contained on the license. Sets forth the amount of the fee required to be paid for the license.
|
| |
|
|
A BILL FOR
|
|
|
|
|
SB0765 |
|
LRB094 06750 LJB 36852 b |
|
| 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 500-10, 500-40, and 500-135 and by adding | 6 |
| Section 500-106 as follows:
| 7 |
| (215 ILCS 5/500-10)
| 8 |
| Sec. 500-10. Definitions. In addition to the definitions in | 9 |
| Section 2 of
the
Code, the following
definitions apply to this | 10 |
| Article:
| 11 |
| "Business entity" means a corporation, association, | 12 |
| partnership, limited
liability
company, limited liability | 13 |
| partnership, or other legal entity.
| 14 |
| "Car rental limited line licensee" means a person | 15 |
| authorized under the
provisions of
Section 500-105 to sell | 16 |
| certain coverages relating to the rental of vehicles.
| 17 |
| "Home state" means the District of Columbia and any state | 18 |
| or territory of the
United
States in which an insurance | 19 |
| producer maintains his or her principal place of
residence or
| 20 |
| principal place of business and is licensed to act as an | 21 |
| insurance producer.
| 22 |
| "Insurance" means any of the lines of authority in Section | 23 |
| 500-35, any health
care plan
under the Health Maintenance | 24 |
| Organization Act, or any limited health care plan
under the
| 25 |
| Limited Health Service Organization Act.
| 26 |
| "Insurance producer" means a person required to be licensed | 27 |
| under the laws of
this State
to sell, solicit, or negotiate | 28 |
| insurance.
| 29 |
| "Insurer" means a company as defined in subsection (e) of | 30 |
| Section 2 of this
Code, a
health maintenance organization as | 31 |
| defined in the Health Maintenance
Organization Act, or a
| 32 |
| limited health service organization as defined in the Limited |
|
|
|
SB0765 |
- 2 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| Health
Service Organization Act.
| 2 |
| "License" means a document issued by the Director | 3 |
| authorizing an individual
to act as an
insurance producer for | 4 |
| the lines of authority specified in the document or
authorizing | 5 |
| a business
entity to act as an insurance producer. The license | 6 |
| itself does not create any
authority, actual,
apparent, or | 7 |
| inherent, in the holder to represent or commit
an insurance | 8 |
| carrier.
| 9 |
| "Limited lines insurance" means those lines of insurance | 10 |
| defined in Section
500-100 , term life insurance as defined in | 11 |
| Section 500-106, or
any other line of insurance that the | 12 |
| Director may deem it necessary to
recognize for the purposes
of | 13 |
| complying with subsection (e) of Section 500-40.
| 14 |
| "Limited lines producer" means a person authorized by the | 15 |
| Director to sell,
solicit, or
negotiate limited lines | 16 |
| insurance.
| 17 |
| "Negotiate" means the act of conferring directly with or | 18 |
| offering advice
directly to a
purchaser or prospective | 19 |
| purchaser of a particular contract of insurance
concerning any
| 20 |
| of the substantive benefits, terms, or conditions of the | 21 |
| contract, provided
that the person
engaged in that act either | 22 |
| sells insurance or obtains insurance from
insurers for | 23 |
| purchasers.
| 24 |
| "Person" means an individual or a business entity.
| 25 |
| "Rental agreement" means a written agreement setting forth | 26 |
| the terms and
conditions
governing the use of a vehicle | 27 |
| provided by a rental company for
rental or lease.
| 28 |
| "Rental company" means a person, or a franchisee of the | 29 |
| person, in the
business of
providing primarily private | 30 |
| passenger vehicles to the public under a
rental agreement for a | 31 |
| period
not to exceed 30 days.
| 32 |
| "Rental period" means the term of the rental agreement.
| 33 |
| "Renter" means a person obtaining the use of a vehicle from | 34 |
| a
rental company under the
terms of a rental agreement for a | 35 |
| period not to exceed 30 days.
| 36 |
| "Self-service storage facility limited line licensee" |
|
|
|
SB0765 |
- 3 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| means a person
authorized under the provisions of Section | 2 |
| 500-107 to sell certain coverages
relating to the rental of | 3 |
| self-service storage facilities.
| 4 |
| "Sell" means to exchange a contract of insurance by any | 5 |
| means, for
money or its equivalent, on
behalf of an insurance | 6 |
| company.
| 7 |
| "Solicit" means attempting to
sell insurance or asking or | 8 |
| urging a person to apply for a
particular kind of insurance | 9 |
| from a particular company.
| 10 |
| "Term life licensee" means a person licensed under the | 11 |
| provisions of Section 500-106 of this Code to sell only term | 12 |
| life insurance.
| 13 |
| "Terminate" means the cancellation of the relationship | 14 |
| between an insurance
producer and the
insurer or the | 15 |
| termination of a producer's authority to transact insurance.
| 16 |
| "Uniform Business Entity Application" means the current | 17 |
| version of the
National Association of Insurance | 18 |
| Commissioners' Uniform
Business Entity Application for | 19 |
| nonresident business entities.
| 20 |
| "Uniform Application" means the current version of the | 21 |
| National Association
of Insurance Commissioners' Uniform
| 22 |
| Application for
nonresident producer licensing.
| 23 |
| "Vehicle" or "rental vehicle" means a motor vehicle of (1) | 24 |
| the private
passenger
type, including passenger vans, mini | 25 |
| vans, and sport utility vehicles or (2)
the cargo type,
| 26 |
| including cargo vans, pickup trucks, and trucks with a gross | 27 |
| vehicle
weight of less than
26,000 pounds the operation of | 28 |
| which does not require the operator to possess a
commercial
| 29 |
| driver's license.
| 30 |
| (Source: P.A. 92-386, eff. 1-1-02; 93-288, eff. 1-1-04.)
| 31 |
| (215 ILCS 5/500-40)
| 32 |
| Sec. 500-40. Nonresident licensing.
| 33 |
| (a) Unless denied a license pursuant to Section 500-70, a | 34 |
| nonresident person
shall
receive a nonresident producer | 35 |
| license if:
|
|
|
|
SB0765 |
- 4 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| (1) the person is currently licensed as a resident and | 2 |
| in good standing in
his
or
her home state;
| 3 |
| (2) the person has submitted the proper request for a | 4 |
| license and has paid
the
fees required by Section 500-135;
| 5 |
| (3) the person has submitted or transmitted to the | 6 |
| Director the
application for
a license that the person | 7 |
| submitted to his or her home state or, instead of
that | 8 |
| application,
a completed Uniform Application; and
| 9 |
| (4) the person's home state awards nonresident | 10 |
| producer licenses to
residents
of this State on the same | 11 |
| basis.
| 12 |
| (b) The Director may verify the producer's licensing status | 13 |
| through the
Producer
Database maintained by the National | 14 |
| Association of Insurance Commissioners or
its
affiliates or
| 15 |
| subsidiaries or by obtaining certification from the public | 16 |
| official having
supervision of insurance in the
applicant's | 17 |
| state of
residence that the applicant has passed the written | 18 |
| examination for the class
of insurance applied for.
| 19 |
| (c) A nonresident producer who moves from one state to | 20 |
| another state or a
resident
producer who moves from this State | 21 |
| to another state must file a change of
address and provide
| 22 |
| certification from the new resident state within 30 days after | 23 |
| the change of
legal residence. No
fee or license application is | 24 |
| required.
| 25 |
| (d) Notwithstanding any other provision of this Article, a | 26 |
| person licensed
as
a surplus
lines producer in his or her home | 27 |
| state shall receive a nonresident surplus
lines producer | 28 |
| license
pursuant to subsection (a) of this Section. Except as | 29 |
| provided in subsection
(a),
nothing in this Section
supersedes | 30 |
| any provision of Section 445 of this Code.
| 31 |
| (e) Notwithstanding any other provision of this Article, | 32 |
| except as provided in Section 500-106 of this Code, a person | 33 |
| licensed
as
a limited
lines producer in his or her home state | 34 |
| shall receive a nonresident limited
lines producer license,
| 35 |
| pursuant to subsection (a) of this Section, granting the same | 36 |
| scope of
authority as granted under
the license issued by the |
|
|
|
SB0765 |
- 5 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| producer's home state. For the purposes of this
subsection, | 2 |
| limited line
insurance is any authority granted by the home | 3 |
| state that restricts the
authority of the license to
less than | 4 |
| the total authority prescribed in the associated major lines | 5 |
| pursuant
to items (1) through
(5) of subsection (a) of Section | 6 |
| 500-35.
| 7 |
| (Source: P.A. 92-386, eff. 1-1-02.)
| 8 |
| (215 ILCS 5/500-106 new) | 9 |
| Sec. 500-106. Limited lines licenses for term life | 10 |
| insurance. | 11 |
| (a) An individual who is at least 18 years of age and whom | 12 |
| the Secretary considers to be competent, trustworthy, and of | 13 |
| good business reputation may obtain a limited lines producer | 14 |
| license to transact only term life insurance as provided in | 15 |
| this Section. For the purposes of this Section, "term life | 16 |
| insurance" means a life insurance policy that does not develop | 17 |
| non-forfeiture values and is not convertible into an annuity or | 18 |
| a life insurance policy that develops non-forfeiture values. | 19 |
| (b) A term life licensee shall not sell, solicit, or | 20 |
| negotiate any kind of insurance other than term life insurance, | 21 |
| unless expressly authorized to do so under a license issued by | 22 |
| the Secretary. | 23 |
| (c) A term life licensee shall not sell term life insurance | 24 |
| that replaces existing insurance, except that a term life | 25 |
| licensee may introduce a prospective insured seeking | 26 |
| replacement insurance to a licensed insurance producer | 27 |
| authorized to transact life insurance in this State and may | 28 |
| receive compensation for the introduction. For the purposes of | 29 |
| this Section, "replacement" has the meaning set forth in 50 | 30 |
| Ill. Adm. Code 917.30. | 31 |
| (d) A term life limited lines license shall not be used by | 32 |
| the term life licensee as a basis for obtaining a nonresident | 33 |
| limited line license in any other state pursuant to any law of | 34 |
| the other state that permits a person licensed as a limited | 35 |
| line producer in the person's home state to receive a |
|
|
|
SB0765 |
- 6 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| nonresident limited lines producer license in the other state, | 2 |
| unless the other state's law provides for a limited license for | 3 |
| term life insurance and imposes requirements on the licensee | 4 |
| that are substantially similar to the requirements imposed by | 5 |
| this Section. A person licensed under a limited lines license | 6 |
| to sell, solicit, or negotiate term life insurance in his or | 7 |
| her home state shall, upon application, receive a nonresident | 8 |
| term life limited lines license pursuant to this Section | 9 |
| granting the same scope of authority as granted under the | 10 |
| limited lines license issued by the person's home state, | 11 |
| provided that the person's home state imposes requirements in | 12 |
| connection with the term life limited lines license that are | 13 |
| substantially similar to the requirements imposed by this | 14 |
| Section. | 15 |
| (e) The application for a term life limited lines license | 16 |
| must be submitted on a form prescribed by the Secretary by a | 17 |
| designee of the insurance company appointing the applicant. The | 18 |
| appointing insurance company must certify that the applicant | 19 |
| has completed at least 10 hours of prelicensing education | 20 |
| regarding term life insurance and must pay the fee required by | 21 |
| Section 500-135 of this Code. | 22 |
| (f) A term life licensee may represent more than one | 23 |
| insurance company. | 24 |
| (g) A term life limited lines license shall remain in | 25 |
| effect as long as the fee set forth in Section 500-135 of this | 26 |
| Code is paid and the education requirements set forth in this | 27 |
| subsection (h) are met by the due date, unless the license is | 28 |
| revoked or suspended pursuant to Section 500-70 of this Code. | 29 |
| Before each license renewal, a term life licensee shall | 30 |
| satisfactorily complete at least 20 hours of course study in | 31 |
| accordance with rules prescribed by the Secretary pursuant to | 32 |
| Section 500-35 of this Code. | 33 |
| (h) An individual term life licensee who allows his or her | 34 |
| license to lapse may, within 12 months after the due date of | 35 |
| the renewal fee, be issued a term life license without the | 36 |
| necessity of completing the prelicensing education. However, a |
|
|
|
SB0765 |
- 7 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| penalty in the amount of double the unpaid renewal fee shall be | 2 |
| required after the due date in addition to the renewal fee. | 3 |
| (i) A term life limited lines license may be terminated by | 4 |
| the appointing insurance company or the licensee.
| 5 |
| (j) Except as provided in this Section, a term life | 6 |
| licensee is not subject to the requirements of Sections 500-25, | 7 |
| 500-30, or 500-35 of this Code
| 8 |
| (k) A term life limited lines license shall contain the | 9 |
| name, address, and personal identification number of the | 10 |
| licensee, the date the license was issued, general conditions | 11 |
| relative to the license's expiration or termination, and any | 12 |
| other information the Secretary considers proper. A term life | 13 |
| limited lines license shall also contain the name and address | 14 |
| of the appointing insurance company. | 15 |
| (l) A term life licensee must inform the Secretary by any | 16 |
| means acceptable to the Secretary of a change of address within | 17 |
| 30 days after the change.
| 18 |
| (215 ILCS 5/500-135)
| 19 |
| Sec. 500-135. Fees.
| 20 |
| (a) The fees required by this Article are as follows:
| 21 |
| (1) a fee of $180 for a person who is a resident of | 22 |
| Illinois, and $250
for a person who is not a resident of | 23 |
| Illinois, payable once every 2
years for an insurance
| 24 |
| producer
license;
| 25 |
| (2) a fee of $50 for the issuance of a temporary | 26 |
| insurance
producer
license;
| 27 |
| (3) a fee of $150 payable once every 2 years for a | 28 |
| business
entity;
| 29 |
| (4) an annual $50 fee for a limited
line producer | 30 |
| license issued under items (1)
through (7) of subsection | 31 |
| (a) of Section 500-100;
| 32 |
| (5) a $50 application fee for the processing of a | 33 |
| request to
take the
written
examination for an insurance | 34 |
| producer license;
| 35 |
| (6) an annual registration fee of $1,000 for |
|
|
|
SB0765 |
- 8 - |
LRB094 06750 LJB 36852 b |
|
| 1 |
| registration of
an
education provider;
| 2 |
| (7) a certification fee of $50 for each certified
| 3 |
| pre-licensing or
continuing
education course and an annual | 4 |
| fee of $20 for renewing the
certification of
each such
| 5 |
| course;
| 6 |
| (8) a fee of $180 for a person who is a resident of | 7 |
| Illinois, and $250
for a person who is not a resident of | 8 |
| Illinois, payable once every 2
years for a car rental
| 9 |
| limited line
license;
| 10 |
| (9) a fee of $200 payable once every 2 years for a | 11 |
| limited
lines license
other
than the licenses issued under | 12 |
| items (1) through (7) of subsection (a) of
Section
500-100, | 13 |
| a
car rental limited line license, or a self-service | 14 |
| storage facility limited
line license;
| 15 |
| (10) a fee of $50 payable once every 2 years for a | 16 |
| self-service storage
facility limited line license. | 17 |
| (11) a fee of $50 payable once every 2 years for a term | 18 |
| life limited lines license.
| 19 |
| (b) Except as otherwise provided, all
fees paid to and | 20 |
| collected by the Director under
this Section shall be paid | 21 |
| promptly after receipt thereof, together with a
detailed | 22 |
| statement of
such fees, into a special fund in the State | 23 |
| Treasury to be known as the
Insurance Producer
Administration | 24 |
| Fund. The moneys deposited into the Insurance Producer
| 25 |
| Administration Fund
may be used only for payment of the | 26 |
| expenses of the Department in the
execution,
administration, | 27 |
| and enforcement of the insurance laws of this State, and shall
| 28 |
| be appropriated as
otherwise provided by law for the payment of | 29 |
| those expenses with first priority
being any
expenses incident | 30 |
| to or associated with the administration and enforcement of
| 31 |
| this Article.
| 32 |
| (Source: P.A. 92-386, eff. 1-1-02; 93-32, eff. 7-1-03; 93-288, | 33 |
| eff. 1-1-04;
revised 9-12-03.)
|
|