[ Search ] [ PDF text ] [ Legislation ]
[ Home ] [ Back ] [ Bottom ]
92_HB2553 LRB9201060JSpcA 1 AN ACT concerning group workers' compensation pools. 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 107a.14 and 107a.15 and adding Sections 6 107a.16, 107a.17, 107a.18, and 107a.19 as follows: 7 (215 ILCS 5/107a.14) 8 Sec. 107a.14. Group workers' compensation pools 9 assessment provisions. 10 (a) When the Director determines by means of audit, 11 annual certified statement, actuarial opinion, or otherwise 12 that the assets possessed by a pool are less than the 13 reserves required together with any other unpaid liabilities, 14 he or she shall order the pool trustees to assess the 15 individual pool participants in an amount not less than 16 necessary to correct the deficiency. This Section is not 17 intended to restrict or preclude the trustees from time to 18 time levying assessments or increasing premium deposits in 19 accordance with the pooling agreement. 20 (b) When the Director determines that the compensation 21 and medical services provided pursuant to this Article may be 22 unpaid by reason of the default of an insolvent qualified 23 group workers' compensation pool and the penal sum of the 24 fidelity bond and the securities provided by the qualified 25 group workers' compensation pool are about to become 26 exhausted, the Director shall declare the qualified group 27 workers' compensation pool to be in default and first levy 28 upon and collect from the individual employer members of the 29 qualified group workers' compensation pool in default an 30 assessment to assure prompt payment of compensation and 31 medical services. No assessment of any individual employer -2- LRB9201060JSpcA 1 member of the qualified group workers' compensation pool made 2 pursuant to this subsection shall exceed 25% of the average 3 annual contribution paid by that employer over the previous 4 3-year period; however, if the Group Workers' Compensation 5 Pool Insolvency Fund is then for any reason financially 6 unable to assure prompt payment of compensation and medical 7 services, the employer member may be assessed without 8 limitation. If and only if (i) the Group Workers' 9 Compensation Pool Insolvency Fund has a positive balance of 10 less than $1,000,000, (ii) the Director has declared a 11 qualified group workers' compensation pool to be in default, 12 and (iii) the Group Workers' Compensation Pool Insolvency 13 Fund is financially unable to pay all employees whose 14 compensation and medical services have been approved, the 15 Director shall levy upon and collect from all qualified 16 group workers' compensation pools an assessment to provide 17 the balance necessary to assure prompt payment of approved 18 compensation and medical services. If an insurance carrier 19 becomes liable for workers' compensation and occupational 20 diseases payments under the terms of the policy covering the 21 qualified group workers' compensation pool, the carrier shall 22 make appropriate payments and payments from the Fund shall 23 cease. Payments from the Fund shall resume only when the 24 insurance carrier's liability is exhausted. 25 (c) An order of the Director to a qualified group 26 workers' compensation pool to levy an assessment against its 27 members, a notice of assessment declared by the Director and 28 levied upon a individual employer member of the qualified 29 group workers' compensation pool, and a notice of assessment 30 declared by the Director and levied upon a qualified group 31 workers' compensation pool under this Section shall be prima 32 facie correct and shall be prima facie evidence of the 33 correctness of the amount of assessment due, as shown in the 34 order or notice. -3- LRB9201060JSpcA 1 (d) Proof of an order, notice, assessment, or levy 2 amount by the Director may be made at a hearing before the 3 Department and in a legal proceeding by a reproduced copy or 4 computer print-out of the Department's record relating 5 thereto in the name of the Department under the certificate 6 of the Director. If reproduced copies of the Department's 7 records are offered as proof of an order, notice, assessment, 8 or levy amount, the Director must certify that those copies 9 are true and exact copies of records on file with the 10 Department. If computer print-outs of the Department's 11 records are offered as proof of an order, notice, assessment, 12 or levy amount, the Director must certify that those computer 13 print-outs are true and exact representations of records 14 properly entered into standard electronic computing equipment 15 in the regular course of the Department's business, at or 16 reasonably near the time of the occurrence of the facts 17 recorded, from trustworthy and reliable information. A 18 certified, reproduced copy or certified computer print-out 19 shall, without further proof, be admitted into evidence 20 before the Department and in any legal proceeding and shall 21 be prima facie proof of the correctness of the amount of 22 assessment due, as shown in the copy or computer print-out. 23 (e) When a notice of assessment or an order for 24 assessment is required by this Section, the notice or order 25 may be given by United States registered or certified 26 mail addressed to the person concerned at his or her last 27 known address, and proof of such mailing shall be sufficient 28 for the purposes of this Article. Notice of a hearing 29 provided for by this Article shall be given not less than 7 30 days before the day fixed for the hearing. Except for the 31 initial contact of a person represented by an attorney, the 32 Department may not contact that person, but shall contact 33 only the attorney representing the person. 34 (Source: P.A. 91-757, eff. 1-1-01.) -4- LRB9201060JSpcA 1 (215 ILCS 5/107a.15) 2 Sec. 107a.15. Authority of Director. 3 (a) If the Director determines that a group workers' 4 compensation pool is not in compliance with this Article, the 5 Director shall require the pool to eliminate the condition 6 causing the noncompliance within a specified time from the 7 date the notice of the Director's requirement is mailed or 8 delivered to the pool. 9 (b) If a pool fails to comply with the Director's 10 requirement, the pool shall be deemed to be in a hazardous 11 financial condition, and the Director may take one or more of 12 the actions authorized by law as to pools in hazardous 13 financial condition. 14 (c) The Department is authorized to make, promulgate, 15 and enforce such reasonable rules relating to the 16 administration and enforcement of the provisions of this 17 Article as may be deemed expedient. 18 (Source: P.A. 91-757, eff. 1-1-01.) 19 (215 ILCS 5/107a.16 new) 20 Sec. 107a.16. Administrative proceedings. 21 (a) If an individual employer member of a qualified 22 group workers' compensation pool or a qualified group 23 workers' compensation pool, or the legal representative of 24 either, files objections to an order for assessment or an 25 assessment notice issued under Section 107a.14 within 30 days 26 after issuance and requests a hearing, the Department shall 27 give notice of the hearing to the person or the person's 28 legal representative. The Department shall hold a hearing in 29 accordance with this Article and shall issue a final 30 assessment under Section 107a.14 to the person or to the 31 person's legal representative for the amount found to be due 32 or issue a final order under Section 107a.14 to levy an 33 assessment directed to a qualified group workers' -5- LRB9201060JSpcA 1 compensation pool. 2 (b) If an objection to an order or notice of assessment 3 and a request for a hearing is not filed within 30 days after 4 the notice or order is issued, the order or notice of 5 assessment shall be deemed to be a final assessment or final 6 order under this Article. 7 (c) After the issuance of a final assessment or order or 8 an order or notice of assessment that becomes final under 9 subsection (b) and at any time before the assessment is 10 reduced to judgment, the Department may, for good cause 11 shown, grant a rehearing (or grant Departmental review and 12 hold a hearing if no hearing in the matter has been held) 13 upon the application of the person aggrieved. Pursuant to 14 the hearing or rehearing, the Department shall issue a 15 revised final order to levy an assessment or a revised final 16 assessment to the person or the person's legal representative 17 for the amount found to be due. 18 (d) The time limitation period on the Department's right 19 to issue a notice of assessment shall not run during any 20 period of time during which the order of any court has the 21 effect of enjoining or restraining the Department from 22 issuing the notice of assessment. 23 (e) The time within which a court action is to be 24 commenced by the Director under this Article shall not run 25 from the date the individual employer member of the qualified 26 group workers' compensation pool files a petition in 27 bankruptcy under the Federal Bankruptcy Act until 30 days 28 after notice of termination or expiration of the automatic 29 stay imposed by the Federal Bankruptcy Act. 30 (f) In addition to any other remedy provided by this 31 Article, and regardless of whether the Department is making 32 or intends to make use of such other remedy, when a 33 corporation or limited liability company violates the 34 provisions of this Article or of any rule promulgated under -6- LRB9201060JSpcA 1 this Article, the Department may give notice to the Attorney 2 General of the identity of that corporation or limited 3 liability company and of the violations committed by that 4 corporation or limited liability company, for such action as 5 is not already provided for by this Article and as the 6 Attorney General may deem appropriate. 7 (g) If the Department determines that an amount of 8 assessment or penalty or interest was incorrectly assessed, 9 whether as the result of a mistake of fact or an error of 10 law, the Department shall waive the amount of assessment or 11 penalty or interest that accrued due to the incorrect 12 assessment. 13 (h) Unless the parties consent to alternative venue, all 14 administrative hearings provided for in this Article with 15 respect to or concerning a person having its principal place 16 of business in this State other than in Cook County shall be 17 held at the Department's office nearest to the location of 18 the person's principal place of business. If the person's 19 principal place of business is in Cook County, the hearing 20 shall be held in Cook County. If the person does not have a 21 principal place of business in this State, the hearing shall 22 be held in Sangamon County or Cook County, at the sole 23 discretion of the Department. 24 (i) The circuit court of the county wherein the person's 25 principal place of business is located, or of Sangamon County 26 or Cook County in those cases where the person does not have 27 a principal place of business in this State, shall have power 28 to review all final administrative decisions of the 29 Department in administering the provisions of this Article. 30 If the proceeding that is to be heard involves a claim for 31 refund in accordance with Section 2a of the State Officers 32 and Employees Money Disposition Act, however, the circuit 33 court having jurisdiction of the action for judicial review 34 under this Section and under the Administrative Review Law -7- LRB9201060JSpcA 1 shall be the same court that entered the temporary 2 restraining order or preliminary injunction authorized under 3 Section 2a of that Act. 4 (j) The provisions of the Administrative Review Law and 5 the rules adopted pursuant to that law shall apply to and 6 govern all proceedings for the judicial review of final 7 administrative decisions of the Department under this 8 Article. The term "administrative decision" is defined as in 9 Section 3-101 of the Code of Civil Procedure. 10 (k) Within 20 days after filing an action under the 11 administrative Review Law to review a final assessment or 12 revised final assessment issued by the Department under this 13 Article, the person filing the action shall file a bond with 14 good and sufficient surety or sureties residing in this State 15 or licensed to do business in this State or, instead of a 16 bond, obtain an order from the court imposing a lien upon the 17 person's property. A lien imposed by a court in lieu of a 18 bond does not apply to the real property of a corporate 19 surety licensed to do business in this State. 20 The court shall set the bond in an amount not less than 21 the amount of the assessment and any penalty the Department 22 claims is owed in its final assessment or revised final 23 assessment, plus the amount of interest owed at the time the 24 Department issued its final assessment. 25 The bond shall be payable to the Department and 26 conditioned upon payment, within 30 days after termination of 27 the proceedings for judicial review, of the amount of 28 assessment and any penalty and interest found by the court to 29 be due. 30 From the time the bond is filed and approved until 2 31 years after termination of the proceeding for judicial review 32 for which the bond is filed, the bond shall be a lien against 33 the real estate situated in the county in which the bond is 34 filed of the person filing the bond and of the sureties on -8- LRB9201060JSpcA 1 the bond until the conditions of the bond are complied with 2 or until the bond is cancelled. 3 If the person filing the bond fails to comply with the 4 bond, the bond shall be forfeited, and the Director may 5 institute an action upon the bond in his or her own name and 6 official capacity for the entire amount of the bond and 7 costs. Action upon the bond shall be in addition to other 8 remedies provided in this Article. If the person filing the 9 bond complies with the bond or if the court determines that 10 no amount of assessment, penalty, or interest is due, the 11 bond shall be canceled. 12 If the court finds that the person cannot procure and 13 furnish a satisfactory surety or sureties for the kind of 14 bond required, the court may relieve the person of the 15 obligation of filing a bond if, upon the timely application 16 for a lien in lieu of a bond and adequate proof, the court is 17 satisfied that the lien imposed would operate to secure the 18 assessment in the manner and to the degree as would a bond. 19 Upon a finding that a lien applied for would secure the 20 assessment at issue, the court shall enter an order, in lieu 21 of a bond, subjecting the person's real and personal property 22 (including subsequently acquired property), situated in the 23 county in which the order is entered, to a lien in favor of 24 the Department. The lien shall be for the amount of the 25 assessment and penalty the Department claims is owed in its 26 final assessment or revised final assessment, plus the amount 27 of interest owed at the time the Department issued its final 28 assessment. The lien shall continue in full force and effect 29 until the termination of the proceedings for judicial review 30 or until the person pays to the Department the assessment and 31 penalty and interest secured by the lien, whichever happens 32 first. In its discretion, the court may impose a lien 33 regardless of the ratio of the person's assets to the final 34 assessment or revised final assessment plus the amount of the -9- LRB9201060JSpcA 1 interest and penalty. Nothing in this Section shall be 2 construed to give the Director a preference over the rights 3 of any bona fide purchaser, mortgagee, judgment creditor, or 4 other lien holder arising prior to the entry of the order 5 creating the lien in favor of the Department. 6 The word "bona fide", as used in this Section, does not 7 include any mortgage of real or personal property or any 8 other credit transaction that results in the mortgagee or 9 the holder of the security acting as trustee for unsecured 10 creditors of the person named in the order for lien who 11 executed the chattel or real property mortgage or the 12 document evidencing the credit transaction. 13 The lien shall be inferior to any lien for general taxes, 14 special assessments, and special taxes levied at any time by 15 any political subdivision of this State. 16 The lien shall not be effective against any purchaser 17 with respect to any item in a retailer's stock in trade 18 purchased from the retailer in the usual course of the 19 retailer's business, and the lien shall not be enforced 20 against the household effects, wearing apparel, or the books, 21 tools, or implements of a trade or profession kept for use by 22 any person. The lien shall not be effective against real 23 property whose title is registered under the provisions of 24 the Registered Titles (Torrens) Act until the provisions of 25 Section 85 of that Act are complied with. 26 If the person filing the complaint fails to comply with 27 the bond requirements of this subsection within 20 days after 28 filing the action under the Administrative Review Law, the 29 Department shall file a motion to dismiss, and the court 30 shall dismiss, the action unless the person filing the action 31 complies with the bond requirements within 30 days after the 32 Department files the motion to dismiss. 33 Upon dismissal of any complaint for failure to comply 34 with the jurisdictional prerequisites of this Article, the -10- LRB9201060JSpcA 1 court shall enter judgment against the person and in favor of 2 the Department in the amount of the final assessment or 3 revised final assessment, together with any interest that may 4 have accrued since the Department issued the final assessment 5 or revised final assessment and costs. 6 (l) Service upon the Director of summons issued in an 7 action to review a final administrative decision shall be 8 service upon the Department. The Department shall certify 9 the record of its proceedings if the person pays to it the 10 sum of $0.75 per page of testimony taken before the 11 Department and $0.25 per page of all other matters contained 12 in the record, except that these charges may be waived when 13 the Department is satisfied that the aggrieved party is a 14 poor person who cannot afford to pay the charges. If payment 15 for the record is not made by the person within 30 days after 16 notice from the Department or the Attorney General of the 17 cost of the record, the court in which the proceeding is 18 pending, on motion of the Department, shall dismiss the 19 complaint and, when the administrative decision as to which 20 the action for judicial review was filed is a final 21 assessment or revised final assessment, enter judgment 22 against the person and in favor of the Department for the 23 amount of assessment and penalty shown by the Department's 24 final assessment or revised final assessment to be due, plus 25 interest as provided in Section 107a.18 from the date the 26 liability upon which the interest accrued became delinquent 27 until the entry of the judgment in the action for judicial 28 review under the Administrative Review Law and costs. 29 (m) When a proceeding authorized by this Article is 30 begun before the Department, either by the Department or by a 31 person subject to this Article, and the person thereafter 32 dies or becomes a person under legal disability before the 33 proceeding is concluded, the legal representative of the 34 deceased or person under legal disability shall notify the -11- LRB9201060JSpcA 1 Department of the death or legal disability. The legal 2 representative, as such, shall then be substituted by the 3 Department for such person. If the legal representative fails 4 to notify the Department of his or her appointment as legal 5 representative, the Department may, upon its own motion, 6 substitute the legal representative in the proceeding pending 7 before the Department for the person who died or became a 8 person under legal disability. 9 (215 ILCS 5/107a.17 new) 10 Sec. 107a.17. Enforcement. If, within 35 days after the 11 issuance of a notice of assessment by the Director, an 12 individual employer member of a defaulting qualified group 13 workers' compensation pool or any qualified group workers' 14 compensation pool fails to make payment of the assessment 15 levied against it, or to make arrangements acceptable to the 16 Director to secure the payment of the assessment levied 17 against it by the Director under subsection (b) Section 18 107a.14, the Director, as receiver of any delinquent 19 qualified group workers' compensation pool to which the 20 assessment relates, as legal representative of the Group 21 Workers' Compensation Pool Insolvency Fund, or in both of 22 those capacities, may bring suit to recover the amount of the 23 assessment, penalty, or interest and, if the defaulting party 24 has died or come under legal disability, file a claim 25 therefor against its estate. No suit with respect to an 26 assessment, penalty, or interest may be instituted more than 27 2 years after the date any proceedings in court for review 28 have terminated or the time for taking review has expired, 29 except with the consent of the person from whom the 30 assessment, penalty, or interest is due. The time limitation 31 period on the Director's right to bring suit under this 32 Section shall not run during any period of time during 33 which the order of any court has the effect of enjoining or -12- LRB9201060JSpcA 1 restraining the Director from bringing the suit. 2 After the time within which an action may be filed for 3 judicial review under the Administrative Review Law expires 4 without an action being filed, a certified copy of the final 5 assessment of the Director may be filed with the circuit 6 court of the county in which the individual employer member 7 or qualified group workers' compensation pool has its 8 principal place of business or with the Circuit Court of Cook 9 County or Sangamon County in those cases in which the 10 individual employer member or qualified group workers' 11 compensation pool does not have its principal place of 12 business in this State. The certified copy of the final 13 assessment must be accompanied by a certification that 14 recites facts that are sufficient to show that the Director 15 complied with the jurisdictional requirements of this Article 16 in arriving at the final assessment and that the individual 17 employer member or qualified group workers' compensation pool 18 had the opportunity for an administrative hearing and for 19 judicial review. If the court is satisfied that the Director 20 complied with the jurisdictional requirements of this Article 21 in arriving at the final assessment or the revised final 22 assessment and that the individual employer member or 23 qualified group workers' compensation pool had its 24 opportunity for an administrative hearing and for judicial 25 review, the court shall enter judgment in favor of the 26 Director and against the individual employer member or 27 qualified group workers' compensation pool for the amount 28 shown to be due by the final assessment, plus any interest 29 that may be due. The judgment shall be entered in the 30 judgment docket of the court. The judgment shall bear 31 interest at the rate set by the Uniform Penalty and Interest 32 Act, but otherwise shall have the same effect as other 33 judgments. The judgment may be enforced, and all laws 34 applicable to sales for the enforcement of a judgment shall -13- LRB9201060JSpcA 1 be applicable. The Department shall file the certified copy 2 of its assessment with the circuit court within 2 years after 3 the assessment becomes final except when the individual 4 employer member or qualified group workers' compensation pool 5 consents in writing to an extension of the filing period. 6 The time limitation period on the Director's right to file 7 the certified copy of the assessment with the circuit court 8 shall not run during any period of time during which the 9 order of any court has the effect of enjoining or restraining 10 the Director from filing the certified copy of the assessment 11 with the circuit court. 12 (215 ILCS 5/107a.18 new) 13 Sec. 107a.18. Penalties and interest. The Director may 14 order and assess penalties, at the rate provided by Section 15 412(3)(a) of the Illinois Insurance Code, against any 16 individual employer member or qualified group workers' 17 compensation pool that fails to pay its assessment when due, 18 whenever it is shown, after notice and an opportunity for 19 hearing, that the failure pay under this Article on the date 20 prescribed for payment (including any extensions of time) 21 is intentional or fraudulent; however, no penalty or interest 22 shall be assessed more than 2 years immediately following the 23 failure to pay on the prescribed date. In addition, any 24 amount of assessment that is not paid when due shall bear 25 interest at the rate and in the manner specified in Sections 26 3-2 and 3-9 of the Uniform Penalty and Interest Act from the 27 date the assessment becomes past due until the assessment is 28 paid or a judgment is obtained by the Director. 29 (215 ILCS 5/107a.19 new) 30 Sec. 107a.19. Applicability. The changes made by this 31 amendatory Act of the 92nd General Assembly apply to all 32 actions pending on or after January 1, 2001, concerning the -14- LRB9201060JSpcA 1 enforcement of any assessment, final assessment, or revised 2 final assessment issued by the Department. The provisions for 3 administrative hearing remedies under this amendatory Act of 4 the 92nd General Assembly do not apply to any action 5 concerning the enforcement of an order for assessment issued 6 by the Director, unless the order is issued under subsection 7 (a) of Section 107a.14 on or after the effective date of this 8 amendatory Act. 9 Section 99. Effective date. This Act takes effect upon 10 becoming law.
[ Top ]