(215 ILCS 5/1720)
    (This Section may contain text from a Public Act with a delayed effective date)
    Sec. 1720. Application procedure.
    (a) Before filing an insurance business transfer plan, the applicant shall file with the Department a notice of its intention to file a plan and shall pay the required fee. Upon request, the applicant and the assuming insurer shall provide the Department with any information necessary for the Department to procure an independent expert that meets the requirements of this Article.
    (b) An insurance business transfer plan shall be filed by the applicant with the Director for his or her review and approval. The plan may be supplemented by other information deemed necessary by the Director, and shall contain the following information or an explanation as to why the following information is not included:
        (1) the name, address, and telephone number of the
    
transferring insurer and the assuming insurer and their respective direct and indirect controlling persons, if any;
        (2) a summary of the insurance business transfer
    
plan;
        (3) an identification and description of the subject
    
business;
        (4) the most recent audited financial statements and
    
statutory annual and quarterly reports of the transferring insurer and the assuming insurer filed with their domiciliary regulator;
        (5) the most recent actuarial report and opinion that
    
quantify the liabilities associated with the subject business;
        (6) pro forma financial statements showing the
    
projected statutory balance sheet, results of operation, and cash flows of the assuming insurer for the 3 years following the proposed transfer and novation;
        (7) officers' certificates of the transferring
    
insurer and the assuming insurer attesting that each has obtained all required internal approvals and authorizations regarding the insurance business transfer plan and completed all necessary and appropriate actions relating thereto;
        (8) a proposal for plan implementation and
    
administration, including the form of notice to be provided under the insurance business transfer plan to any policyholder whose policy is part of the subject business;
        (9) a full description as to how notice under the
    
insurance business transfer plan shall be provided;
        (10) a description of any reinsurance arrangements
    
that would pass to the assuming insurer under the insurance business transfer plan;
        (11) a description of any guarantees or additional
    
reinsurance that will cover the subject business following the transfer and novation;
        (12) a statement describing the assuming insurer's
    
proposed investment policies and any contemplated third-party claims management and administration arrangements;
        (13) a description of how the transferring and
    
assuming insurers will be licensed for the purpose of preserving state guaranty association coverage;
        (14) a description of the financial implications of
    
the transaction including solvency, capital adequacy, cash flow, reserves, asset quality, and risk-based capital;
        (15) an analysis of the assuming insurer's
    
corporate governance structure to ensure that there is proper board management oversight and expertise to manage the subject business;
        (16) an evaluation of the competency, experience, and
    
integrity of the persons who would control the operation of an involved insurer;
        (17) a certified statement that the transaction is
    
not being made for improper purposes, including fraud;
        (18) evidence of approval or nonobjection of the
    
transfer from the chief insurance regulator of the state of the transferring insurer's domicile; and
        (19) a report from the independent expert that shall
    
provide the following:
            (A) a statement of the independent expert's
        
professional qualifications and descriptions of the experience that qualifies him or her as an expert suitable for the engagement;
            (B) a certified statement from the independent
        
expert that he or she meets the standards for an independent expert under this Article;
            (C) a description of the scope of the report;
            (D) a summary of the terms of the insurance
        
business transfer plan to the extent relevant to the report;
            (E) a listing and summaries of documents,
        
reports, and other material information the independent expert has considered in preparing the report and whether any information requested was not provided;
            (F) the extent to which the independent expert
        
has relied on information provided by or judgment of others;
            (G) the people on whom the independent expert has
        
relied and why, in his or her opinion, such reliance is reasonable;
            (H) the independent expert's opinion of the
        
likely effects of the insurance business transfer plan on policyholders, reinsurers, and claimants, distinguishing between:
                (i) transferring policyholders, reinsurers,
            
and claimants;
                (ii) policyholders, reinsurers, and claimants
            
of the transferring insurer whose policies will not be transferred; and
                (iii) policyholders, reinsurers, and
            
claimants of the assuming insurer;
            (I) the facts and circumstances supporting each
        
opinion that the independent expert expresses in the report; and
            (J) consideration as to whether the security
        
position of policyholders that are affected by the insurance business transfer are materially adversely affected by the transfer, including, but not limited to, state guaranty association coverage.
    (c) The independent expert's report as required by paragraph (19) of subsection (b) shall also include, but not be limited to, a review of and report on the following:
        (1) analysis of the transferring insurer's actuarial
    
review of resources for the subject business to determine the reserve adequacy;
        (2) analysis of the financial condition of the
    
transferring and assuming insurers and the effect the transfer will have on the financial condition of each company;
        (3) review of the plans or proposals the assuming
    
insurer has with respect to the administration of the policies subject to the proposed transfer;
        (4) whether the proposed transfer has a material,
    
adverse impact on the policyholders, reinsurers, and claimants of the transferring and the assuming insurers;
        (5) analysis of the assuming insurer's corporate
    
governance structure to ensure that there is proper board and management oversight and expertise to manage the subject business;
        (6) analysis of whether any policyholder or group of
    
policyholders will lose or gain state guaranty association coverage as a result of the transaction; and
        (7) any other information that the Director requests
    
in order to review the insurance business transfer.
    (d) After the receipt of a complete insurance business transfer plan, the Director shall review the plan to determine if the applicant is authorized to submit it to a court.
    (e) The Director shall authorize the submission of the insurance business transfer plan to a court unless he or she finds that the insurance business transfer would have a material adverse impact on the interests of policyholders, reinsurers, or claimants that are part of the subject business.
    (f) If the Director determines that the insurance business transfer would have a material adverse impact on the interests of policyholders, reinsurers, or claimants that are part of the subject business, he or she shall notify the applicant and specify any modifications, supplements, or amendments and any additional information or documentation with respect to the plan that must be provided to the Director before he or she shall allow the applicant to proceed with the court filing.
    (g) The applicant shall have 30 days following the date the Director notifies him or her of a determination under subsection (f) to file an amended insurance business transfer plan providing the modifications, supplements, or amendments and additional information or documentation as requested by the Director. If necessary, the applicant may request in writing an extension of time of 30 days. If the applicant does not make an amended filing within the time period provided in this subsection, including any extension of time granted by the Director, the insurance business transfer plan filing shall terminate and a subsequent filing by the applicant shall be considered a new filing which shall require compliance with all provisions of this Article as if the prior filing had never been made.
    (h) When the modification, supplement, amendment, or additional information requested in subsection (f) is received, the Director shall review the amended plan in accordance with subsection (c).
    (i) If the Director determines that the plan may proceed with the court filing, the Director shall confirm that fact in writing to the applicant.
(Source: P.A. 103-75, eff. 1-1-25.)