215 ILCS 5/154.9

(215 ILCS 5/154.9)

Sec. 154.9. Payment of applicable use or occupation tax, title, and transfer fees on a private passenger total loss claim.

(a) When an insurer determines that an insured's or third-party claimant's private passenger automobile is a total loss that is covered under the terms of a personal automobile policy issued or renewed on or after July 1, 2022 by the insurer, the insurer shall pay any use or occupation tax imposed by the State or a unit of local government and title and transfer fees as provided for in this Section. As used in this Section, "private passenger vehicle" means a private passenger motor vehicle, station wagon, or any other 4-wheeled motor vehicle with a load capacity of 1,500 pounds or less that is not used in the occupation, profession, or business of the insured or third-party claimant, not used as a public or livery conveyance for passengers, nor rented to others.

(b) If the insurer elects to replace the insured vehicle, the insurer shall pay any use or occupation tax imposed by the State or a unit of local government tax and title and transfer fees on the replacement vehicle.

(c) If a cash settlement is provided for the total loss private passenger vehicle, the insurer shall reimburse the insured or third-party claimant for any use or occupation tax imposed by the State or a unit of local government and title and transfer fees if the replacement vehicle is purchased or leased within 30 days after the receipt of the cash settlement by the insured or third-party claimant and the insured or third-party claimant substantiates such purchase and the payment of such taxes and fees by submission of appropriate documentation to the insurer within 33 days after the receipt of the settlement or receipt of the required reimbursement form from the insurer, whichever is later.

(1) With respect to leased vehicles, use or occupation taxes and title and transfer fees shall be deemed to be incurred by the insured or the third-party claimant at the time the lease is entered into, but only if such use or occupation taxes and title and transfer fees are included in the cost of the lease or are paid directly by the insured or third-party claimant.

(2) The insurer is not required to reimburse the insured or third-party claimant for any use or occupation taxes and title or transfer fees in excess of the amount payable based on the value of the total loss vehicle at the time of the loss or for taxes and title or transfer fees not actually paid by the insured or third-party claimant.

(3) In lieu of this reimbursement procedure, the insurer may directly pay the required amount of any use or occupation taxes and title and transfer fees to the claimant at the time of settlement.

(4) If an insurer requires a particular form be used to apply for reimbursement of any use or occupation taxes and title or transfer fees, the form must be delivered to the insured or third-party claimant at or before the time of settlement.

(d) The Department may adopt rules establishing uniform standards for implementation of this Section, including, but not limited to, prescribing the method of determining the market value of the insured's or third-party claimant's vehicle.

(Source: P.A. 102-69, eff. 7-1-22.)