Bill Text: IL HB3521 | 2023-2024 | 103rd General Assembly | Engrossed
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Amends the Hospital Licensing Act. Provides that no administrator, agent, or employee of a hospital affiliate may abuse a patient in a facility operated by a hospital affiliate. Defines "hospital affiliate". Makes conforming changes.
Spectrum: Moderate Partisan Bill (Democrat 34-5)
Status: (Enrolled) 2024-06-26 - Sent to the Governor [HB3521 Detail]
Download: Illinois-2023-HB3521-Engrossed.html
Bill Title: Amends the Hospital Licensing Act. Provides that no administrator, agent, or employee of a hospital affiliate may abuse a patient in a facility operated by a hospital affiliate. Defines "hospital affiliate". Makes conforming changes.
Spectrum: Moderate Partisan Bill (Democrat 34-5)
Status: (Enrolled) 2024-06-26 - Sent to the Governor [HB3521 Detail]
Download: Illinois-2023-HB3521-Engrossed.html
| |||||||
| |||||||
| |||||||
1 | AN ACT concerning regulation.
| ||||||
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 Section 445 as follows:
| ||||||
6 | (215 ILCS 5/445) (from Ch. 73, par. 1057)
| ||||||
7 | Sec. 445. Surplus line.
| ||||||
8 | (1) Definitions. For the purposes of this Section:
| ||||||
9 | "Affiliate" means, with respect to an insured, any entity | ||||||
10 | that controls, is controlled by, or is under common control | ||||||
11 | with the insured. For the purpose of this definition, an | ||||||
12 | entity has control over another entity if: | ||||||
13 | (A) the entity directly or indirectly or acting | ||||||
14 | through one or more other persons owns, controls, or has | ||||||
15 | the power to vote 25% or more of any class of voting | ||||||
16 | securities of the other entity; or | ||||||
17 | (B) the entity controls in any manner the election of | ||||||
18 | a majority of the directors or trustees of the other | ||||||
19 | entity. | ||||||
20 | "Affiliated group" means any group of entities that are | ||||||
21 | all affiliated. | ||||||
22 | "Authorized insurer" means an insurer that holds a | ||||||
23 | certificate of
authority
issued by the Director but, for the |
| |||||||
| |||||||
1 | purposes of this Section, does not
include a
domestic surplus | ||||||
2 | line insurer as defined in Section 445a or any
residual market
| ||||||
3 | mechanism. | ||||||
4 | "Exempt commercial purchaser" means any person purchasing | ||||||
5 | commercial insurance that, at the time of placement, meets the | ||||||
6 | following requirements: | ||||||
7 | (A) The person employs or retains a qualified risk | ||||||
8 | manager to negotiate insurance coverage. | ||||||
9 | (B) The person has paid aggregate nationwide | ||||||
10 | commercial property and casualty insurance premiums in | ||||||
11 | excess of $100,000 in the immediately preceding 12 months. | ||||||
12 | (C) The person meets at least one of the following | ||||||
13 | criteria: | ||||||
14 | (I) The person possesses a net worth in excess of | ||||||
15 | $20,000,000, as such amount is adjusted pursuant to | ||||||
16 | the provision in this definition concerning percentage | ||||||
17 | change. | ||||||
18 | (II) The person generates annual revenues in | ||||||
19 | excess of $50,000,000, as such amount is adjusted | ||||||
20 | pursuant to the provision in this definition | ||||||
21 | concerning percentage change. | ||||||
22 | (III) The person employs more than 500 full-time | ||||||
23 | or full-time equivalent employees per individual | ||||||
24 | insured or is a member of an affiliated group | ||||||
25 | employing more than 1,000 employees in the aggregate. | ||||||
26 | (IV) The person is a not-for-profit organization |
| |||||||
| |||||||
1 | or public entity generating annual budgeted | ||||||
2 | expenditures of at least $30,000,000, as such amount | ||||||
3 | is adjusted pursuant to the provision in this | ||||||
4 | definition concerning percentage change. | ||||||
5 | (V) The person is a municipality with a population | ||||||
6 | in excess of 50,000 persons. | ||||||
7 | Effective on January 1, 2015 and each fifth January 1 | ||||||
8 | occurring thereafter, the amounts in subitems (I), (II), and | ||||||
9 | (IV) of item (C) of this definition shall be adjusted to | ||||||
10 | reflect the percentage change for such 5-year period in the | ||||||
11 | Consumer Price Index for All Urban Consumers published by the | ||||||
12 | Bureau of Labor Statistics of the Department of Labor. | ||||||
13 | "Home state" means the following: | ||||||
14 | (A) With respect to an insured, except as provided in | ||||||
15 | item (B) of this definition: | ||||||
16 | (I) the state in which an insured maintains its | ||||||
17 | principal place of business or, in the case of an | ||||||
18 | individual, the individual's principal residence; or | ||||||
19 | (II) if 100% of the insured risk is located out of | ||||||
20 | the state referred to in subitem (I), the state to | ||||||
21 | which the greatest percentage of the insured's taxable | ||||||
22 | premium for that insurance contract is allocated. | ||||||
23 | (B) If more than one insured from an affiliated group | ||||||
24 | are named insureds on a single surplus line insurance | ||||||
25 | contract, then "home state" means the home state, as | ||||||
26 | determined pursuant to item (A) of this definition, of the |
| |||||||
| |||||||
1 | member of the affiliated group that has the largest | ||||||
2 | percentage of premium attributed to it under such | ||||||
3 | insurance contract. | ||||||
4 | If more than one insured from a group that is not | ||||||
5 | affiliated are named insureds on a single surplus line | ||||||
6 | insurance contract, then : (I) if individual group members | ||||||
7 | pay 100% of the premium for the insurance from their own | ||||||
8 | funds, "home state" means the home state, as determined | ||||||
9 | pursuant to item (A) of this definition, of each | ||||||
10 | individual group member; each individual group member's | ||||||
11 | coverage under the surplus line insurance contract shall | ||||||
12 | be treated as a separate surplus line contract for the | ||||||
13 | purposes of this Section; (II) otherwise, "home state" | ||||||
14 | means the home state, as determined pursuant to item (A) | ||||||
15 | of this definition, of the group. | ||||||
16 | Nothing in this definition shall be construed to alter the | ||||||
17 | terms of the surplus line insurance contract. | ||||||
18 | "Master policy" means a surplus line insurance contract | ||||||
19 | with a single set of general contractual terms that are | ||||||
20 | designed to apply on a group basis to multiple insureds who may | ||||||
21 | or may not be affiliated and who may be added to or removed | ||||||
22 | from the contract throughout the course of the contract | ||||||
23 | period. A master policy may include certain provisions that | ||||||
24 | vary for each insured depending on the insured's | ||||||
25 | characteristics and the coverage sought. | ||||||
26 | "Multi-State risk" means a risk with insured exposures in |
| |||||||
| |||||||
1 | more than one State. | ||||||
2 | "NAIC" means the National Association of Insurance | ||||||
3 | Commissioners or any successor entity. | ||||||
4 | "Personal lines insurance" means insurance as defined in | ||||||
5 | subsection (a), (b), or (c) of Section 143.13 of this Code. | ||||||
6 | "Premium" means any amount designated as premium on the | ||||||
7 | declarations page or elsewhere in a policy and on any | ||||||
8 | endorsement, but does not include taxes, the Surplus Line | ||||||
9 | Association of Illinois recording fee, or any other fee. | ||||||
10 | "Program business" means a clearly defined group of | ||||||
11 | insurance contracts procured by a licensed surplus line | ||||||
12 | producer from an unauthorized insurer, under a single | ||||||
13 | agreement between the producer and insurer, for insureds with | ||||||
14 | the same or similar characteristics and containing the same or | ||||||
15 | similar contract terms. | ||||||
16 | "Qualified risk manager" means, with respect to a | ||||||
17 | policyholder of commercial insurance, a person who meets all | ||||||
18 | of the following requirements: | ||||||
19 | (A) The person is an employee of, or third-party | ||||||
20 | consultant retained by, the commercial policyholder. | ||||||
21 | (B) The person provides skilled services in loss | ||||||
22 | prevention, loss reduction, or risk and insurance coverage | ||||||
23 | analysis, and purchase of insurance. | ||||||
24 | (C) With regard to the person: | ||||||
25 | (I) the person has: | ||||||
26 | (a) a bachelor's degree or higher from an |
| |||||||
| |||||||
1 | accredited college or university in risk | ||||||
2 | management, business administration, finance, | ||||||
3 | economics, or any other field determined by the | ||||||
4 | Director or his designee to demonstrate minimum | ||||||
5 | competence in risk management; and | ||||||
6 | (b) the following: | ||||||
7 | (i) three years of experience in risk | ||||||
8 | financing, claims administration, loss | ||||||
9 | prevention, risk and insurance analysis, or | ||||||
10 | purchasing commercial lines of insurance; or | ||||||
11 | (ii) alternatively has: | ||||||
12 | (AA) a designation as a Chartered | ||||||
13 | Property and Casualty Underwriter (in this | ||||||
14 | subparagraph (ii) referred to as "CPCU") | ||||||
15 | issued by the American Institute for | ||||||
16 | CPCU/Insurance Institute of America; | ||||||
17 | (BB) a designation as an Associate in | ||||||
18 | Risk Management (ARM) issued by the | ||||||
19 | American Institute for CPCU/Insurance | ||||||
20 | Institute of America; | ||||||
21 | (CC) a designation as Certified Risk | ||||||
22 | Manager (CRM) issued by the National | ||||||
23 | Alliance for Insurance Education & | ||||||
24 | Research; | ||||||
25 | (DD) a designation as a RIMS Fellow | ||||||
26 | (RF) issued by the Global Risk Management |
| |||||||
| |||||||
1 | Institute; or | ||||||
2 | (EE) any other designation, | ||||||
3 | certification, or license determined by | ||||||
4 | the Director or his designee to | ||||||
5 | demonstrate minimum competency in risk | ||||||
6 | management; | ||||||
7 | (II) the person has: | ||||||
8 | (a) at least 7 years of experience in risk | ||||||
9 | financing, claims administration, loss prevention, | ||||||
10 | risk and insurance coverage analysis, or | ||||||
11 | purchasing commercial lines of insurance; and | ||||||
12 | (b) has any one of the designations specified | ||||||
13 | in subparagraph (ii) of paragraph (b); | ||||||
14 | (III) the person has at least 10 years of | ||||||
15 | experience in risk financing, claims administration, | ||||||
16 | loss prevention, risk and insurance coverage analysis, | ||||||
17 | or purchasing commercial lines of insurance; or | ||||||
18 | (IV) the person has a graduate degree from an | ||||||
19 | accredited college or university in risk management, | ||||||
20 | business administration, finance, economics, or any | ||||||
21 | other field determined by the Director or his or her | ||||||
22 | designee to demonstrate minimum competence in risk | ||||||
23 | management. | ||||||
24 | "Residual market mechanism" means an association, | ||||||
25 | organization, or other
entity described in Article XXXIII of | ||||||
26 | this Code or Section 7-501 of the
Illinois Vehicle Code or any |
| |||||||
| |||||||
1 | similar association, organization, or other
entity. | ||||||
2 | "State" means any state of the United States, the District | ||||||
3 | of Columbia, the Commonwealth of Puerto Rico, Guam, the | ||||||
4 | Northern Mariana Islands, the Virgin Islands, and American | ||||||
5 | Samoa. | ||||||
6 | "Surplus line insurance" means insurance on a risk: | ||||||
7 | (A) of the kinds specified in Classes 2 and 3 of | ||||||
8 | Section 4 of this Code; and | ||||||
9 | (B) that is procured from an unauthorized insurer | ||||||
10 | after the insurance producer representing the insured or | ||||||
11 | the surplus line producer is unable, after diligent | ||||||
12 | effort, to procure the insurance from authorized insurers; | ||||||
13 | and | ||||||
14 | (C) where Illinois is the home state of the insured, | ||||||
15 | for policies effective, renewed or extended on July 21, | ||||||
16 | 2011 or later and for multiyear policies upon the policy | ||||||
17 | anniversary that falls on or after July 21, 2011; and | ||||||
18 | (D) that is located in Illinois, for policies | ||||||
19 | effective prior to July 21, 2011. | ||||||
20 | "Taxable premium" means a premium for any risk that is | ||||||
21 | located in or attributed to any state. | ||||||
22 | "Unauthorized insurer" means an insurer that does not hold | ||||||
23 | a valid
certificate of authority issued by the Director but, | ||||||
24 | for the purposes of this
Section, shall also include a | ||||||
25 | domestic surplus line insurer as defined in
Section 445a.
| ||||||
26 | (1.5) Procuring surplus line insurance; surplus line |
| |||||||
| |||||||
1 | insurer requirements. | ||||||
2 | (a) License required. Insurance producers may procure | ||||||
3 | surplus line insurance only if licensed
as a surplus line | ||||||
4 | producer under this Section. | ||||||
5 | (b) Domestic and foreign insurer eligibility. Licensed | ||||||
6 | surplus line producers may procure surplus line
insurance | ||||||
7 | from an unauthorized insurer domiciled in any state only | ||||||
8 | if the insurer:
| ||||||
9 | (i) is permitted in its domiciliary jurisdiction | ||||||
10 | to write the type of insurance involved; and | ||||||
11 |
(ii) has, based upon information available to the | ||||||
12 | surplus
line producer,
a policyholders surplus of not | ||||||
13 | less than $15,000,000
determined in
accordance with | ||||||
14 | the laws of its domiciliary jurisdiction;
and
| ||||||
15 |
(iii) has standards of solvency and management | ||||||
16 | that are adequate
for the protection of policyholders.
| ||||||
17 |
Where an unauthorized insurer does not meet the
| ||||||
18 | standards set forth
in (ii) and (iii) above, a surplus | ||||||
19 | line producer may, if necessary, procure
insurance from | ||||||
20 | that insurer only if prior written warning of
such fact or
| ||||||
21 | condition is given to the insured by the insurance | ||||||
22 | producer or surplus line
producer.
| ||||||
23 | (c) Alien insurer eligibility. Licensed surplus line | ||||||
24 | producers may procure surplus line insurance from an | ||||||
25 | unauthorized insurer not domiciled in any state only if | ||||||
26 | the insurer meets the standards for unauthorized insurers |
| |||||||
| |||||||
1 | domiciled in any state in paragraph (b) of this subsection | ||||||
2 | (1.5) or is listed on the Quarterly Listing of Alien | ||||||
3 | Insurers maintained by the International Insurers | ||||||
4 | Department of the NAIC at the time of procurement. The | ||||||
5 | Director shall make the Quarterly Listing of Alien | ||||||
6 | Insurers available to surplus line producers without | ||||||
7 | charge. | ||||||
8 | (d) Prohibited transactions. Insurance producers shall | ||||||
9 | not procure from an
unauthorized insurer an insurance | ||||||
10 | policy: | ||||||
11 | (i) that is designed to satisfy the
proof of | ||||||
12 | financial responsibility and insurance requirements in | ||||||
13 | any
Illinois law where the law requires that the proof | ||||||
14 | of
insurance is issued by an authorized insurer or | ||||||
15 | residual market
mechanism; | ||||||
16 | (ii) that covers the risk of accidental injury to | ||||||
17 | employees arising
out of and in the course of | ||||||
18 | employment according to the provisions of the
Workers' | ||||||
19 | Compensation Act; or | ||||||
20 | (iii) that insures any Illinois personal lines | ||||||
21 | risk that is eligible
for residual market mechanism | ||||||
22 | coverage, unless the insured or prospective
insured | ||||||
23 | requests limits of liability greater than the limits | ||||||
24 | provided by the
residual market mechanism. In the | ||||||
25 | course of making a diligent effort to
procure | ||||||
26 | insurance from authorized insurers, an insurance |
| |||||||
| |||||||
1 | producer shall not be
required to submit a risk to a | ||||||
2 | residual market mechanism when the risk is not
| ||||||
3 | eligible for coverage or exceeds the limits available | ||||||
4 | in the residual market
mechanism. | ||||||
5 | Where there is an insurance policy issued by an
| ||||||
6 | authorized insurer or residual market mechanism
insuring a | ||||||
7 | risk described in item (i), (ii), or (iii)
above, nothing | ||||||
8 | in this paragraph shall be construed
to prohibit a surplus | ||||||
9 | line producer from procuring
from an unauthorized insurer | ||||||
10 | a policy insuring the
risk on an excess or umbrella basis | ||||||
11 | where the excess
or umbrella policy is written over one or | ||||||
12 | more
underlying policies.
| ||||||
13 | (e) Exempt commercial purchaser diligent effort. | ||||||
14 | Licensed surplus line producers may procure surplus line | ||||||
15 | insurance from an unauthorized insurer for an exempt | ||||||
16 | commercial purchaser without making the required diligent | ||||||
17 | effort to procure the insurance from authorized insurers | ||||||
18 | if: | ||||||
19 | (i) the producer has disclosed to the exempt | ||||||
20 | commercial purchaser that such insurance may or may | ||||||
21 | not be available from authorized insurers that may | ||||||
22 | provide greater protection with more regulatory | ||||||
23 | oversight; and | ||||||
24 | (ii) the exempt commercial purchaser has | ||||||
25 | subsequently in writing requested the producer to | ||||||
26 | procure such insurance from an unauthorized insurer. |
| |||||||
| |||||||
1 | (f) Commercial wholesale transaction diligent effort. | ||||||
2 | A licensed surplus line producer may procure a surplus | ||||||
3 | line insurance contract, other than a personal lines | ||||||
4 | insurance contract, from an unauthorized insurer without | ||||||
5 | making the required diligent effort to procure the | ||||||
6 | insurance from authorized insurers if the risk was | ||||||
7 | referred to the surplus line producer by an | ||||||
8 | Illinois-licensed insurance producer who is not affiliated | ||||||
9 | with the surplus line producer. | ||||||
10 | (g) Master policy diligent effort. For a master policy | ||||||
11 | insurance contract, a licensed surplus line producer may | ||||||
12 | make the required diligent effort to procure the insurance | ||||||
13 | from authorized insurers annually for the master policy | ||||||
14 | rather than individually for each insured that is added | ||||||
15 | during the policy period. The diligent effort shall | ||||||
16 | include all variable provisions of the master policy. | ||||||
17 | (h) Program business diligent effort. For program | ||||||
18 | business, a licensed surplus line producer may make the | ||||||
19 | required diligent effort to procure the insurance from | ||||||
20 | authorized insurers annually for the program rather than | ||||||
21 | individually for each contract. The diligent effort shall | ||||||
22 | include all variable provisions of the program master | ||||||
23 | policy . | ||||||
24 | (2) Surplus line producer; license. Any licensed producer | ||||||
25 | who is a
resident of this State, or any nonresident who | ||||||
26 | qualifies under Section
500-40, may be licensed as a surplus |
| |||||||
| |||||||
1 | line producer upon payment of an annual license fee of $400.
| ||||||
2 | A surplus line producer so licensed shall keep a separate
| ||||||
3 | account of
the business transacted thereunder for 7 years from | ||||||
4 | the policy effective date which shall be open at all times to | ||||||
5 | the
inspection of the Director or his representative.
| ||||||
6 | No later than July 21, 2012, the State of Illinois shall | ||||||
7 | participate in the national insurance producer database of the | ||||||
8 | NAIC, or any other equivalent uniform national database, for | ||||||
9 | the licensure of surplus line producers and the renewal of | ||||||
10 | such licenses.
| ||||||
11 | (3) Taxes and reports.
| ||||||
12 | (a) Surplus line tax and penalty for late payment. The | ||||||
13 | surplus line tax rate for a surplus line insurance policy | ||||||
14 | or contract is determined as follows: | ||||||
15 | (i) 3% for policies or contracts with an effective | ||||||
16 | date prior to July 1, 2003; | ||||||
17 | (ii) 3.5% for policies or contracts with an | ||||||
18 | effective date of July 1, 2003 or later. | ||||||
19 | A surplus line producer shall file with the Director | ||||||
20 | on or
before
February 1 and August 1 of each year a report | ||||||
21 | in the form prescribed by the
Director on all surplus line | ||||||
22 | insurance procured from unauthorized insurers and | ||||||
23 | submitted to the Surplus Line Association of Illinois
| ||||||
24 | during the preceding
6 month period ending December 31 or | ||||||
25 | June 30
respectively, and on the filing of such report | ||||||
26 | shall pay to the Director
for the use and benefit of the |
| |||||||
| |||||||
1 | State a sum equal to the surplus line tax rate multiplied | ||||||
2 | by the
gross taxable
premiums less returned taxable | ||||||
3 | premiums upon all surplus line insurance submitted to the | ||||||
4 | Surplus Line Association of Illinois during the preceding | ||||||
5 | 6 months.
| ||||||
6 | Any surplus line producer who fails to pay the full | ||||||
7 | amount due under this
subsection is liable, in addition to | ||||||
8 | the amount due, for such late fee,
penalty, and interest | ||||||
9 | charges as are provided for under Section 412 of
this | ||||||
10 | Code. The Director, through the
Attorney General, may
| ||||||
11 | institute an action in the name of the People of the State | ||||||
12 | of Illinois, in
any court of competent jurisdiction, for | ||||||
13 | the recovery of the amount of such
taxes, late fees, | ||||||
14 | interest, and penalties due, and prosecute the same to | ||||||
15 | final judgment, and take
such steps as are necessary to | ||||||
16 | collect the same.
| ||||||
17 | (b) Fire Marshal Tax.
Each surplus line producer shall | ||||||
18 | file with the Director on or before February 1
of each year | ||||||
19 | a report in the form prescribed by the Director on all
fire | ||||||
20 | insurance procured from unauthorized insurers and | ||||||
21 | submitted to the Surplus Line Association of Illinois | ||||||
22 | during the previous year that is subject to tax under
| ||||||
23 | Section 12 of the Fire Investigation
Act
and shall pay to | ||||||
24 | the Director the fire marshal tax required thereunder.
| ||||||
25 | (c) Taxes and fees charged to insured. The taxes | ||||||
26 | imposed under this
subsection and the recording fees |
| |||||||
| |||||||
1 | charged by the Surplus Line
Association of Illinois may be | ||||||
2 | charged to and collected from surplus line
insureds.
| ||||||
3 | (4) (Blank).
| ||||||
4 | (5) Submission of documents to Surplus Line Association of | ||||||
5 | Illinois.
A surplus line producer shall submit every insurance | ||||||
6 | contract and premium-bearing endorsement
issued
under his or | ||||||
7 | her license to the Surplus Line Association of Illinois for
| ||||||
8 | recording. The submission and recording may be
effected | ||||||
9 | through electronic means. The submission shall set
forth:
| ||||||
10 | (a) the name of the insured;
| ||||||
11 | (b) the description and location of the insured | ||||||
12 | property or
risk;
| ||||||
13 | (c) (blank);
| ||||||
14 | (d) the gross premiums charged or returned;
| ||||||
15 | (e) the name of the unauthorized insurer from whom | ||||||
16 | coverage has been procured;
| ||||||
17 | (f) the kind or kinds of insurance procured; and
| ||||||
18 | (g) amount of premium subject to tax required by | ||||||
19 | Section 12 of the Fire
Investigation Act.
| ||||||
20 | Proposals, endorsements, and other documents which are
| ||||||
21 | incidental to the insurance but which do not affect the | ||||||
22 | premium
charged
are exempted from the submission and recording | ||||||
23 | requirements.
| ||||||
24 | The submission of insuring contracts
to the Surplus Line | ||||||
25 | Association of
Illinois constitutes a certification by the | ||||||
26 | surplus line producer or by the insurance producer who |
| |||||||
| |||||||
1 | presented the risk to the surplus line producer for
placement | ||||||
2 | as a surplus line risk that
after diligent effort, where | ||||||
3 | required, the required insurance could not be procured from
| ||||||
4 | authorized insurers and that
such procurement was otherwise in | ||||||
5 | accordance with the surplus line law.
| ||||||
6 | (6) Evidence of recording required. It shall be unlawful | ||||||
7 | for an insurance
producer to deliver any unauthorized insurer
| ||||||
8 | contract or premium-bearing endorsement unless it contains | ||||||
9 | evidence of recording by the Surplus Line Association of
| ||||||
10 | Illinois.
| ||||||
11 | (7) Inspection of records. A surplus line producer shall
| ||||||
12 | maintain
separate records of the business transacted under his | ||||||
13 | or her license for 7 years from the policy effective date,
| ||||||
14 | including complete copies of surplus line insurance contracts | ||||||
15 | maintained on
paper or by electronic means, which
records | ||||||
16 | shall be open at all times for inspection by the Director and | ||||||
17 | by
the Surplus Line Association of Illinois.
| ||||||
18 | (8) Violations and penalties. The Director may suspend or | ||||||
19 | revoke or
refuse to renew a surplus line producer license for | ||||||
20 | any violation of this Code.
In addition to or in lieu of | ||||||
21 | suspension or revocation, the Director may
subject a surplus | ||||||
22 | line producer
to a civil penalty of up to $2,000 for each cause | ||||||
23 | for suspension
or
revocation. Such penalty is enforceable | ||||||
24 | under subsection (5) of Section
403A of this Code.
| ||||||
25 | Whenever it appears to the satisfaction of the Director | ||||||
26 | that a surplus line producer has made a documented good faith |
| |||||||
| |||||||
1 | determination of the home state for a surplus line insurance | ||||||
2 | contract and has paid the surplus line taxes to a state other | ||||||
3 | than Illinois, and the Director determines that the producer's | ||||||
4 | good faith determination was incorrect and the home state is | ||||||
5 | Illinois, the surplus line producer may, at the discretion of | ||||||
6 | the Director, be required to submit the contract to the | ||||||
7 | Surplus Line Association of Illinois and pay applicable taxes | ||||||
8 | and recording fees, but there shall be no penalty, interest, | ||||||
9 | or late fee assessed. | ||||||
10 | (9) Director may declare insurer ineligible. If the
| ||||||
11 | Director determines
that the further assumption of risks might | ||||||
12 | be hazardous to the
policyholders of an unauthorized insurer, | ||||||
13 | the Director may
order the
Surplus Line Association of
| ||||||
14 | Illinois not to accept and record insurance contracts | ||||||
15 | evidencing insurance in
such insurer and order surplus line | ||||||
16 | producers to cease
procuring insurance
from such insurer.
| ||||||
17 | (10) Service of process upon Director. Insurance contracts
| ||||||
18 | delivered under this Section from unauthorized insurers, other | ||||||
19 | than domestic
surplus line insurers as defined in Section | ||||||
20 | 445a,
shall contain a
provision designating the
Director and | ||||||
21 | his successors in office the true and lawful attorney of the
| ||||||
22 | insurer upon whom may be served all lawful process in any
| ||||||
23 | action, suit or
proceeding arising out of such insurance.
| ||||||
24 | Service of process made upon the Director to be valid | ||||||
25 | hereunder must state
the name of the insured, the name of the | ||||||
26 | unauthorized insurer
and identify
the contract of insurance. |
| |||||||
| |||||||
1 | The Director at his option is authorized to
forward a copy of | ||||||
2 | the process to the Surplus Line Association of Illinois
for | ||||||
3 | delivery to the unauthorized insurer or the Director may | ||||||
4 | deliver the process to the
unauthorized insurer by other means | ||||||
5 | which he considers to be
reasonably
prompt and certain.
| ||||||
6 | (10.5) Required notice to policyholder. Insurance | ||||||
7 | contracts delivered under this Section from unauthorized | ||||||
8 | insurers, other than domestic surplus line insurers as defined | ||||||
9 | in Section 445a, shall have stamped or imprinted on the first | ||||||
10 | page thereof in not less than 12-pt. bold face type the | ||||||
11 | following legend: "Notice to Policyholder: This contract is | ||||||
12 | issued, pursuant to Section 445 of the Illinois Insurance | ||||||
13 | Code, by a company not authorized and licensed to transact | ||||||
14 | business in Illinois and as such is not covered by the Illinois | ||||||
15 | Insurance Guaranty Fund." Insurance contracts delivered under | ||||||
16 | this Section from domestic surplus line insurers as defined in | ||||||
17 | Section 445a shall have stamped or imprinted on the first page | ||||||
18 | thereof in not less than 12-pt. bold face type the following | ||||||
19 | legend: "Notice to Policyholder: This contract is issued by a | ||||||
20 | domestic surplus line insurer, as defined in Section 445a of | ||||||
21 | the Illinois Insurance Code, pursuant to Section 445, and as | ||||||
22 | such is not covered by the Illinois Insurance Guaranty Fund."
| ||||||
23 | (11) Marine, aviation, and transportation. The Illinois | ||||||
24 | Surplus Line law does not apply to insurance of
property and | ||||||
25 | operations of railroads or aircraft engaged in interstate or
| ||||||
26 | foreign commerce, insurance of vessels, crafts or hulls, |
| |||||||
| |||||||
1 | cargoes, marine
builder's risks, marine protection and | ||||||
2 | indemnity, or other risks including
strikes and war risks | ||||||
3 | insured under ocean or wet marine forms of policies.
| ||||||
4 | (12) Applicability of Illinois Insurance Code. Surplus | ||||||
5 | line insurance procured under this Section, including
| ||||||
6 | insurance procured from a domestic surplus line insurer, is | ||||||
7 | not subject
to the provisions of the Illinois Insurance Code | ||||||
8 | other than Sections 123,
123.1, 401, 401.1, 402, 403, 403A, | ||||||
9 | 408, 412, 445, 445a, 445.1, 445.2, 445.3,
445.4, and all of the | ||||||
10 | provisions of Article XXXI to the extent that the
provisions | ||||||
11 | of Article XXXI are not inconsistent with the terms of this | ||||||
12 | Act.
| ||||||
13 | (Source: P.A. 102-224, eff. 1-1-22 .)
|