Public Act 90-0817 of the 90th General Assembly

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90th General Assembly

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Public Act 90-0817

SB417 Enrolled                                 LRB9002307NTsb

    AN ACT concerning certain contracts, amending named Acts.

    Be it enacted by the People of  the  State  of  Illinois,
represented in the General Assembly:

    Section  5.  The  Illinois  Insurance  Code is amended by
changing Section 78 as follows:

    (215 ILCS 5/78) (from Ch. 73, par. 690)
    Sec. 78. Governmental  subscribers  accounts;  dividends;
other returns.
    (a)  The  attorney-in-fact  of a governmental reciprocal,
in addition to the books of account of the reciprocal,  shall
keep  and  maintain from and after the effective date of this
amendatory  Act  of  1993,  a  separate  account   for   each
individual  subscriber,  setting  forth  therein  the date or
periods of the subscriber's participation in the  reciprocal,
the  subscriber's  deposits,  the  savings  returned  to  the
subscriber and such other information as may be necessary for
the determination of the subscriber's proportionate share, if
any,  of  the  surplus  funds  of  the  reciprocal in case of
liquidation. The attorney-in-fact shall not  be  required  to
file a list of the subscribers with the Department.
    (b)  The  board  of  directors of the attorney-in-fact of
any governmental reciprocal may in its discretion and subject
to the prior  approval  of  the  advisory  committee  of  the
governmental reciprocal and the Director of Insurance:
         (1)  declare  dividends  to  its  subscribers in the
    same manner and upon and subject to the  same  terms  and
    conditions  as  are  provided  in  Section  54 for mutual
    companies, except that  the  reference  to  "articles  of
    incorporation"  in  Section 54 shall mean the declaration
    of  organization  or  the  power  of  attorney  or  other
    authority of the attorney-in-fact under  which  contracts
    of insurance are to be exchanged pursuant to this article
    as applied to governmental reciprocals; and
         (2)  return   guaranty   fund  or  guaranty  capital
    contributions in the same manner and upon and subject  to
    the  same terms and conditions as are provided in Section
    56 for mutual companies  and  upon  compliance  with  the
    provisions  of  the agreement to subscribe (the agreement
    to make the contributions), if any.
    No payment or return of surplus  (other  than  return  of
guaranty fund or of guaranty capital) shall be made except in
accordance with this Section and sound business judgment.
(Source: P.A. 88-364.)

    Section  10.  The  Service  Contract  Act  is  amended by
changing Section 10 as follows:

    (215 ILCS 152/10)
    Sec.  10.  Exemptions.  Service  contract  providers  and
related service contract sellers and administrators complying
with this Act are not required to comply  with  and  are  not
subject  to  any provision of the Illinois Insurance Code.  A
service contract  provider  who  is  the  manufacturer  or  a
wholly-owned subsidiary of the manufacturer of the product or
the  builder,  seller,  or  lessor of the product that is the
subject of the service contract is required  to  comply  only
with  Sections 30, 35, 45, and 50 of this Act; except that, a
service contract provider who sells a motor  vehicle  or  who
leases,  but  is  not  the manufacturer of, the motor vehicle
that is the subject of the service contract must comply  with
this  Act  in  its  entirety.  Contracts  for  the repair and
monitoring of  private  alarm  or  private  security  systems
regulated under the Private Detective, Private Alarm, Private
Security,  and  Locksmith  Act  of  1993  are not required to
comply with this Act and are not subject to any provision  of
the Illinois Insurance Code.
(Source: P.A. 90-711, eff. 8-7-98.)

    Section  99.  Effective date.  This Act takes effect upon
becoming law.

                            President of the Senate

                            Speaker, House of Representatives

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