(215 ILCS 5/131.20) (from Ch. 73, par. 743.20)
    Sec. 131.20. Standards for transactions with affiliates; adequacy of surplus.
    (1) Transactions with their affiliates by companies subject to registration are subject to the following standards:
        (a) the terms are fair and reasonable;
        (a-5) agreements for cost sharing services and
    
management shall include such provisions as may be required by rules and regulations issued by the Director;
        (b) charges or fees for services performed are
    
reasonable;
        (c) expenses incurred and payment received must be
    
allocated to the company in conformity with customary insurance accounting practices consistently applied;
        (d) the books, accounts, and records of each party
    
must be so maintained as to clearly and accurately disclose the precise nature and details of the transactions, including accounting information necessary to support the reasonableness of the charges or fees to the respective parties; and
        (e) the company's surplus as regards policyholders
    
following any transactions with affiliates or dividends or distributions to securityholders or affiliates must be reasonable in relation to the company's outstanding liabilities and adequate to meet its financial needs.
    (2) For purposes of this Article, in determining whether a company's surplus as regards policyholders is reasonable in relation to the company's outstanding liabilities and adequate to meet its needs, the following factors, among others, may be considered:
        (a) the size of the company as measured by its
    
assets, capital and surplus, reserves, premium writings, insurance in force and other appropriate criteria;
        (b) the extent to which the company's business is
    
diversified among several lines of insurance;
        (c) the number and size of risks insured in each line
    
of business;
        (d) the extent of the geographical dispersion of the
    
company's insured risks;
        (e) the nature and extent of the company's
    
reinsurance program;
        (f) the quality, diversification, and liquidity of
    
the company's investment portfolio;
        (g) the recent past and projected future trend in the
    
size of the company's investment portfolio;
        (h) the surplus as regards policyholders maintained
    
by companies comparable to the registrant in respect of the factors enumerated in this paragraph;
        (i) the adequacy of the company's reserves;
        (j) the quality of the company's earnings and the
    
extent to which the reported earnings include extraordinary items; and
        (k) the quality and liquidity of investments in
    
affiliates. The Director may discount any such investment or treat any such investment as a non-admitted asset for purposes of determining the adequacy of surplus as regards policyholders whenever the investment so warrants.
(Source: P.A. 98-609, eff. 1-1-14.)