Bill Text: IL SB0660 | 2009-2010 | 96th General Assembly | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Amends the Savings and Loan Share and Account Act. Makes a technical change to a Section relating to joint ownership of accounts.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2010-07-27 - Public Act . . . . . . . . . 96-1332 [SB0660 Detail]

Download: Illinois-2009-SB0660-Engrossed.html

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AN ACT concerning regulation.
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 adding
Article XLV as follows:
(215 ILCS 5/Art. XLV heading new)
ARTICLE XLV. PUBLIC ADJUSTERS
(215 ILCS 5/1501 new)
Sec. 1501. Short title. This Article may be cited as the
Public Adjusters Law.
(215 ILCS 5/1505 new)
Sec. 1505. Purpose and scope. This Article governs the
qualifications and procedures for the licensing of public
adjusters. It specifies the duties of and restrictions on
public adjusters, which include limiting their licensure to
assisting insureds in first party claims.
(215 ILCS 5/1510 new)
Sec. 1510. Definitions. In this Article:
"Business entity" means a corporation, association,
partnership, limited liability company, limited liability

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partnership, or other legal entity.
"Director" means the Director of the Division of Insurance
of the Department of Financial and Professional Regulation.
"Division" means the Division of Insurance of the
Department of Financial and Professional Regulation.
"Fingerprints" means an impression of the lines on the
finger taken for the purpose of identification. The impression
may be electronic or in ink converted to electronic format.
"Home state" means the District of Columbia and any state
or territory of the United States where the public adjuster's
principal place of residence or principal place of business is
located. If neither the state in which the public adjuster
maintains the principal place of residence nor the state in
which the public adjuster maintains the principal place of
business has a substantially similar law governing public
adjusters, the public adjuster may declare another state in
which it becomes licensed and acts as a public adjuster to be
the home state.
"Individual" means a natural person.
"Person" means an individual or a business entity.
"Public adjuster" means any person who, for compensation or
any other thing of value on behalf of the insured:
(i) acts or aids, solely in relation to first party
claims arising under insurance contracts that insure the
real or personal property of the insured, on behalf of an
insured in negotiating for, or effecting the settlement of,

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a claim for loss or damage covered by an insurance
contract;
(ii) advertises for employment as an public adjuster of
insurance claims or solicits business or represents
himself or herself to the public as an public adjuster of
first party insurance claims for losses or damages arising
out of policies of insurance that insure real or personal
property; or
(iii) directly or indirectly solicits business,
investigates or adjusts losses, consults, or advises an
insured about first party claims for losses or damages
arising out of policies of insurance that insure real or
personal property for another person engaged in the
business of adjusting losses or damages covered by an
insurance policy for the insured.
"Uniform individual application" means the current version
of the National Association of Directors (NAIC) Uniform
Individual Application for resident and nonresident
individuals.
"Uniform business entity application" means the current
version of the National Association of Insurance Commissioners
(NAIC) Uniform Business Entity Application for resident and
nonresident business entities.
(215 ILCS 5/1515 new)
Sec. 1515. License required.

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(a) A person shall not act or hold himself out as a public
adjuster in this State unless the person is licensed as a
public adjuster in accordance with this Article.
(b) A person licensed as a public adjuster shall not
misrepresent to a claimant that he or she is an adjuster
representing an insurer in any capacity, including acting as an
employee of the insurer or acting as an independent adjuster
unless so appointed by an insurer in writing to act on the
insurer's behalf for that specific claim or purpose. A licensed
public adjuster is prohibited from charging that specific
claimant a fee when appointed by the insurer and the
appointment is accepted by the public adjuster.
(c) A business entity acting as a public adjuster is
required to obtain a public adjuster license. Application shall
be made using the Uniform Business Entity Application. Before
approving the application, the Director shall find that:
(1) the business entity has paid the required fees to
be registered as a business entity in this State; and
(2) all officers, shareholders, and persons with
ownership interests in the business entity are licensed
public adjusters responsible for the business entity's
compliance with the insurance laws, rules, and regulations
of this State.
(d) Notwithstanding subsections (a) through (c) of this
Section, a license as a public adjuster shall not be required
of the following:

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(1) an attorney admitted to practice in this State,
when acting in his or her professional capacity as an
attorney;
(2) a person who negotiates or settles claims arising
under a life or health insurance policy or an annuity
contract;
(3) a person employed only for the purpose of obtaining
facts surrounding a loss or furnishing technical
assistance to a licensed public adjuster, including
photographers, estimators, private investigators,
engineers, and handwriting experts;
(4) a licensed health care provider, or employee of a
licensed health care provider, who prepares or files a
health claim form on behalf of a patient; or
(5) a person who settles subrogation claims between
insurers.
(215 ILCS 5/1520 new)
Sec. 1520. Application for license.
(a) A person applying for a public adjuster license shall
make application to the Director on the appropriate uniform
application or other application prescribed by the Director.
(b) The applicant shall declare under penalty of perjury
and under penalty of refusal, suspension, or revocation of the
license that the statements made in the application are true,
correct, and complete to the best of the applicant's knowledge

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and belief.
(c) In order to make a determination of license
eligibility, the Director is authorized to require
fingerprints of applicants and submit such fingerprints and the
fee required to perform the criminal history record checks to
the Illinois State Police and the Federal Bureau of
Investigation (FBI) for State and national criminal history
record checks.
(d) The Director may adopt rules to establish procedures
necessary to carry out the requirements of subsection (c) of
this Section.
(e) The Director is authorized to submit electronic
fingerprint records and necessary identifying information to
the NAIC, its affiliates, or subsidiaries for permanent
retention in a centralized repository. The purpose of such a
centralized repository is to provide Directors with access to
fingerprint records in order to perform criminal history record
checks.
(215 ILCS 5/1525 new)
Sec. 1525. Resident license.
(a) Before issuing a public adjuster license to an
applicant under this Section, the Director shall find that the
applicant:
(1) is eligible to designate this State as his or her
home state or is a nonresident who is not eligible for a

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license under Section 1540;
(2) has not committed any act that is a ground for
denial, suspension, or revocation of a license as set forth
in Section 1555;
(3) is trustworthy, reliable, competent, and of good
reputation, evidence of which may be determined by the
Director;
(4) is financially responsible to exercise the license
and has provided proof of financial responsibility as
required in Section 1560 of this Article; and
(5) maintains an office in the home state of residence
with public access by reasonable appointment or regular
business hours. This includes a designated office within a
home state of residence.
(b) In addition to satisfying the requirements of
subsection (a) of this Section, an individual shall
(1) be at least 18 years of age;
(2) have successfully passed the public adjuster
examination;
(3) designate a licensed individual public adjuster
responsible for the business entity's compliance with the
insurance laws, rules, and regulations of this State; and
(4) designate only licensed individual public
adjusters to exercise the business entity's license.
(c) The Director may require any documents reasonably
necessary to verify the information contained in the

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application.
(215 ILCS 5/1530 new)
Sec. 1530. Examination.
(a) An individual applying for a public adjuster license
under this Article must pass a written examination unless he or
she is exempt pursuant to Section 1535 of this Article. The
examination shall test the knowledge of the individual
concerning the duties and responsibilities of a public adjuster
and the insurance laws and regulations of this State.
Examinations required by this Section shall be developed and
conducted under rules and regulations prescribed by the
Director.
(b) The Director may make arrangements, including
contracting with an outside testing service, for administering
examinations and collecting the nonrefundable fee. Each
individual applying for an examination shall remit a
nonrefundable fee as prescribed by the Director. An individual
who fails to appear for the examination as scheduled or fails
to pass the examination shall reapply for an examination and
remit all required fees and forms before being rescheduled for
another examination. An individual who fails to pass the
examination must wait 90 days prior to rescheduling an
examination.
(215 ILCS 5/1535 new)

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Sec. 1535. Exemptions from examination.
(a) An individual who applies for a public adjuster license
in this State who was previously licensed as a public adjuster
in another state based on an public adjuster examination shall
not be required to complete any prelicensing education. This
exemption is only available if (i) the person is currently
licensed in that state or if the application is received within
12 months of the cancellation of the applicant's previous
license; and (ii) if the prior state issues a certification
that, at the time of cancellation, the applicant was in good
standing in that state or the state's producer database records
or records maintained by the NAIC, its affiliates, or
subsidiaries, indicate that the public adjuster is or was
licensed in good standing.
(b) A person licensed as a public adjuster in another state
based on a public adjuster examination who moves to this State
shall submit an application within 90 days of establishing
legal residence to become a resident licensee pursuant to
Section 1525 of this Article. No prelicensing examination shall
be required of that person to obtain a public adjuster license.
(c) An individual who applies for a public adjuster license
in this State who was previously licensed as a public adjuster
in this State shall not be required to complete any
prelicensing examination. This exemption is only available if
the application is received within 12 months of the
cancellation of the applicant's previous license in this State

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and if, at the time of cancellation, the applicant was in good
standing in this State.
(215 ILCS 5/1540 new)
Sec. 1540. Nonresident license reciprocity.
(a) Unless denied licensure pursuant to Section 1555 of
this Article, a nonresident person shall receive a nonresident
public adjuster license if:
(1) the person is currently licensed as a resident
public adjuster and in good standing in his or her home
state;
(2) the person has submitted the proper request for
licensure and has provided proof of financial
responsibility as required in Section 1560 of this Article;
(3) the person has submitted or transmitted to the
Director the appropriate completed application for
licensure; and
(4) the person's home state awards nonresident public
adjuster licenses to residents of this State on the same
basis.
(b) The Director may verify the public adjuster's licensing
status through the producer database maintained by the NAIC,
its affiliates, or subsidiaries.
(c) As a condition to continuation of a public adjuster
license issued under this Section, the licensee shall maintain
a resident public adjuster license in his or her home state.

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The nonresident public adjuster license issued under this
Section shall terminate and be surrendered immediately to the
Director if the home state public adjuster license terminates
for any reason, unless the public adjuster has been issued a
license as a resident public adjuster in his or her new home
state. Notification to the state or states where the
nonresident license is issued must be made as soon as possible,
yet no later that 30 days of change in new state resident
license. The licensee shall include his or her new and old
address on the notification. A new state resident license is
required for nonresident licenses to remain valid. The new
state resident license must have reciprocity with the licensing
nonresident state or states for the nonresident license not to
terminate.
(215 ILCS 5/1545 new)
Sec. 1545. License.
(a) Unless denied licensure under this Article, persons who
have met the requirements of this Article shall be issued a
public adjuster license.
(b) A public adjuster license shall remain in effect unless
revoked, terminated, or suspended as long as the requirements
for license renewal are met by the due date.
(c) The licensee shall inform the Director by any means
acceptable to the Director of a change of address, change of
legal name, or change of information submitted on the

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application within 30 days of the change.
(d) A licensed public adjuster shall be subject to Article
XXVI of this Code.
(e) A public adjuster who allows his or her license to
lapse may, within 12 months from the due date of the renewal,
be issued a new public adjuster license without necessity of
passing a written examination. However, a penalty in the amount
of double the unpaid renewal fee shall be required for the
issue of the new public adjuster license.
(f) A licensed public adjuster that is unable to comply
with license renewal procedures due to military service or a
long-term medical disability may request a waiver of the
procedures in subsection (e) of this Section. The public
adjuster may also request a waiver of any examination
requirement, fine, or other sanction imposed for failure to
comply with renewal procedures.
(g) The license shall contain the licensee's name, city and
state of business address, personal identification number, the
date of issuance, the expiration date, and any other
information the Director deems necessary.
(h) In order to assist in the performance of the Director's
duties, the Director may contract with non-governmental
entities, including the NAIC or any affiliates or subsidiaries
that the NAIC oversees, to perform any ministerial functions,
including the collection of fees and data, related to licensing
that the Director may deem appropriate.

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(215 ILCS 5/1555 new)
Sec. 1555. License denial, nonrenewal, or revocation.
(a) The Director may place on probation, suspend, revoke,
deny, or refuse to issue or renew a public adjuster's license
or may levy a civil penalty or any combination of actions, for
any one or more of the following causes:
(1) providing incorrect, misleading, incomplete, or
materially untrue information in the license application;
(2) violating any insurance laws, or violating any
regulation, subpoena, or order of the Director or of
another state's Director;
(3) obtaining or attempting to obtain a license through
misrepresentation or fraud;
(4) improperly withholding, misappropriating, or
converting any monies or properties received in the course
of doing insurance business;
(5) intentionally misrepresenting the terms of an
actual or proposed insurance contract or application for
insurance;
(6) having been convicted of a felony;
(7) having admitted or been found to have committed any
insurance unfair trade practice or insurance fraud;
(8) using fraudulent, coercive, or dishonest
practices; or demonstrating incompetence,
untrustworthiness, or financial irresponsibility in the

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conduct of business in this State or elsewhere;
(9) having an insurance license or public adjuster
license or its equivalent, denied, suspended, or revoked in
any other state, province, district, or territory;
(10) forging another's name to an application for
insurance or to any document related to an insurance
transaction;
(11) cheating, including improperly using notes or any
other reference material, to complete an examination for an
insurance license or public adjuster license;
(12) knowingly accepting insurance business from or
transacting business with an individual who is not licensed
but who is required to be licensed by the Director;
(13) failing to comply with an administrative or court
order imposing a child support obligation;
(14) failing to pay State income tax or comply with any
administrative or court order directing payment of State
income tax;
(15) failing to comply with or having violated any of
the standards set forth in Section 1590 of this Law; or
(16) failing to maintain the records required by
Section 1585 of this Law.
(b) If the action by the Director is to nonrenew, suspend,
or revoke a license or to deny an application for a license,
the Director shall notify the applicant or licensee and advise,
in writing, the applicant or licensee of the reason for the

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suspension, revocation, denial, or nonrenewal of the
applicant's or licensee's license. The applicant or licensee
may make written demand upon the Director within 30 days after
the date of mailing for a hearing before the Director to
determine the reasonableness of the Director's action. The
hearing must be held within not fewer than 20 days nor more
than 30 days after the mailing of the notice of hearing and
shall be held pursuant to 50 Ill. Adm. Code 2402.
(c) The license of a business entity may be suspended,
revoked, or refused if the Director finds, after hearing, that
an individual licensee's violation was known or should have
been known by one or more of the partners, officers, or
managers acting on behalf of the business entity and the
violation was neither reported to the Director, nor corrective
action taken.
(d) In addition to or in lieu of any applicable denial,
suspension or revocation of a license, a person may, after
hearing, be subject to a civil penalty. In addition to or
instead of any applicable denial, suspension, or revocation of
a license, a person may, after hearing, be subject to a civil
penalty of up to $10,000 for each cause for denial, suspension,
or revocation, however, the civil penalty may total no more
than $100,000.
(e) The Director shall retain the authority to enforce the
provisions of and impose any penalty or remedy authorized by
this Article against any person who is under investigation for

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or charged with a violation of this Article even if the
person's license or registration has been surrendered or has
lapsed by operation of law.
(f) Any individual whose public adjuster's license is
revoked or whose application is denied pursuant to this Section
shall be ineligible to apply for a public adjuster's license
for 5 years. A suspension pursuant to this Section may be for
any period of time up to 5 years.
(215 ILCS 5/1560 new)
Sec. 1560. Bond or letter of credit.
(a) Prior to the issuance of a license as a public adjuster
and for the duration of the license, the applicant shall secure
evidence of financial responsibility in a format prescribed by
the Director through a surety bond or irrevocable letter of
credit, subject to all of the following requirements:
(1) A surety bond executed and issued by an insurer
authorized to issue surety bonds in this State, which bond:
(A) shall be in the minimum amount of $20,000;
(B) shall be in favor of this State and shall
specifically authorize recovery by the Director on
behalf of any person in this State who sustained
damages as the result of erroneous acts, failure to
act, conviction of fraud, or conviction of unfair
practices in his or her capacity as a public adjuster;
and

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(C) shall not be terminated unless at least 30
days' prior written notice will have been filed with
the Director and given to the licensee; and
(2) An irrevocable letter of credit issued by a
qualified financial institution, which letter of credit
(A) shall be in the minimum amount of $20,000;
(B) shall be to an account to the Director and
subject to lawful levy of execution on behalf of any
person to whom the public adjuster has been found to be
legally liable as the result of erroneous acts, failure
to act, fraudulent acts, or unfair practices in his or
her capacity as a public adjuster; and
(C) shall not be terminated unless at least 30
days' prior written notice will have been filed with
the and given to the licensee.
(b) The issuer of the evidence of financial responsibility
shall notify the Director upon termination of the bond or
letter of credit, unless otherwise directed by the Director.
(c) The Director may ask for the evidence of financial
responsibility at any time he or she deems relevant.
(d) The authority to act as a public adjuster shall
automatically terminate if the evidence of financial
responsibility terminates or becomes impaired.
(215 ILCS 5/1565 new)
Sec. 1565. Continuing education.

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(a) An individual who holds a public adjuster license and
who is not exempt under subsection (b) of this Section shall
satisfactorily complete a minimum of 24 hours of continuing
education courses, including 3 hours of classroom ethics
instruction, reported on a biennial basis in conjunction with
the license renewal cycle.
The Director may not approve a course of study unless the
course provides for classroom, seminar, or self-study
instruction methods. A course given in a combination
instruction method of classroom or seminar and self-study shall
be deemed to be a self-study course unless the classroom or
seminar certified hours meets or exceeds two-thirds of the
total hours certified for the course. The self-study material
used in the combination course must be directly related to and
complement the classroom portion of the course in order to be
considered for credit. An instruction method other than
classroom or seminar shall be considered as self-study
methodology. Self-study credit hours require the successful
completion of an examination covering the self-study material.
The examination may not be self-evaluated. However, if the
self-study material is completed through the use of an approved
computerized interactive format whereby the computer validates
the successful completion of the self-study material, no
additional examination is required. The self-study credit
hours contained in a certified course shall be considered
classroom hours when at least two-thirds of the hours are given

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as classroom or seminar instruction.
The public adjuster must complete the course in advance of
the renewal date to allow the education provider time to report
the credit to the Department.
(b) This Section shall not apply to:
(1) licensees not licensed for one full year prior to
the end of the applicable continuing education biennium; or
(2) licensees holding nonresident public adjuster
licenses who have met the continuing education
requirements of their home state and whose home state gives
credit to residents of this State on the same basis.
(c) Only continuing education courses approved by the
Director shall be used to satisfy the continuing education
requirement of subsection (a) of this Section.
(215 ILCS 5/1570 new)
Sec. 1570. Public adjuster fees.
(a) A public adjuster shall not pay a commission, service
fee, or other valuable consideration to a person for
investigating or settling claims in this State if that person
is required to be licensed under this Article and is not so
licensed.
(b) A person shall not accept a commission, service fee, or
other valuable consideration for investigating or settling
claims in this State if that person is required to be licensed
under this Article and is not so licensed.

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(c) A public adjuster may pay or assign commission, service
fees, or other valuable consideration to persons who do not
investigate or settle claims in this State, unless the payment
would violate State law.
(215 ILCS 5/1575 new)
Sec. 1575. Contract between public adjuster and insured.
(a) Public adjusters shall ensure that all contracts for
their services are in writing and contain the following terms:
(1) legible full name of the adjuster signing the
contract, as specified in Department records;
(2) permanent home state business address and phone
number;
(3) license number;
(4) title of "Public Adjuster Contract";
(5) the insured's full name, street address, insurance
company name, and policy number, if known or upon
notification;
(6) a description of the loss and its location, if
applicable;
(7) description of services to be provided to the
insured;
(8) signatures of the public adjuster and the insured;
(9) date contract was signed by the public adjuster and
date the contract was signed by the insured;
(10) attestation language stating that the public

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adjuster is fully bonded pursuant to State law; and
(11) full salary, fee, commission, compensation, or
other considerations the public adjuster is to receive for
services.
(b) The contract may specify that the public adjuster shall
be named as a co-payee on an insurer's payment of a claim.
(1) If the compensation is based on a share of the
insurance settlement, the exact percentage shall be
specified.
(2) Initial expenses to be reimbursed to the public
adjuster from the proceeds of the claim payment shall be
specified by type, with dollar estimates set forth in the
contract and with any additional expenses first approved by
the insured.
(3) Compensation provisions in a public adjusting
contract shall not be redacted in any copy of the contract
provided to the Director.
(c) If the insurer, not later than 5 business days after
the date on which the loss is reported to the insurer, either
pays or commits in writing to pay to the insured the policy
limit of the insurance policy, the public adjuster shall:
(1) not receive a commission consisting of a percentage
of the total amount paid by an insurer to resolve a claim;
(2) inform the insured that loss recovery amount might
not be increased by insurer; and
(3) be entitled only to reasonable compensation from

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the insured for services provided by the public adjuster on
behalf of the insured, based on the time spent on a claim
and expenses incurred by the public adjuster, until the
claim is paid or the insured receives a written commitment
to pay from the insurer.
(d) A public adjuster shall provide the insured a written
disclosure concerning any direct or indirect financial
interest that the public adjuster has with any other party who
is involved in any aspect of the claim, other than the salary,
fee, commission, or other consideration established in the
written contract with the insured, including, but not limited
to, any ownership of or any compensation expected to be
received from, any construction firm, salvage firm, building
appraisal firm, motor vehicle repair shop, or any other firm
which that provides estimates for work, or that performs any
work, in conjunction with damages caused by the insured loss on
which the public adjuster is engaged. The word "firm" shall
include any corporation, partnership, association, joint-stock
company, or person.
(e) A public adjuster contract may not contain any contract
term that:
(1) allows the public adjuster's percentage fee to be
collected when money is due from an insurance company, but
not paid, or that allows a public adjuster to collect the
entire fee from the first check issued by an insurance
company, rather than as percentage of each check issued by

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an insurance company;
(2) requires the insured to authorize an insurance
company to issue a check only in the name of the public
adjuster; or
(3) precludes a public adjuster or an insured from
pursuing civil remedies.
(f) The following provisions apply to a contract between a
public adjuster and an insured:
(1) Prior to the signing of the contract, the public
adjuster shall provide the insured with a separate signed
and dated disclosure document regarding the claim process
that states:
"Property insurance policies obligate the insured to
present a claim to his or her insurance company for
consideration. There are 3 types of adjusters that could be
involved in that process. The definitions of the 3 types
are as follows:
(A) "Company adjuster" means the insurance
adjusters who are employees of an insurance company.
They represent the interest of the insurance company
and are paid by the insurance company. They will not
charge you a fee.
(B) "Independent adjuster" means the insurance
adjusters who are hired on a contract basis by an
insurance company to represent the insurance company's
interest in the settlement of the claim. They are paid

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by your insurance company. They will not charge you a
fee.
(C) "Public adjuster" means the insurance
adjusters who do not work for any insurance company.
They work for the insured to assist in the preparation,
presentation and settlement of the claim. The insured
hires them by signing a contract agreeing to pay them a
fee or commission based on a percentage of the
settlement, or other method of compensation.".
(2) The insured is not required to hire a public
adjuster to help the insured meet his or her obligations
under the policy, but has the right to do so.
(3) The insured has the right to initiate direct
communications with the insured's attorney, the insurer,
the insurer's adjuster, and the insurer's attorney, or any
other person regarding the settlement of the insured's
claim. Once a public adjuster has been retained, the
company adjuster or other insurance representative may not
communicate directly with the insured without the
permission or consent of the public adjuster or the
insured's legal counsel.
(4) The public adjuster is not a representative or
employee of the insurer.
(5) The salary, fee, commission, or other
consideration is the obligation of the insured, not the
insurer, except when rights have been assigned to the

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public adjuster by the insured.
(g) The contracts shall be executed in duplicate to provide
an original contract to the public adjuster, and an original
contract to the insured. The public adjuster's original
contract shall be available at all times for inspection without
notice by the Director.
(h) The public adjuster shall provide the insurer with an
exact copy of the contract by the insured, authorizing the
public adjuster to represent the insured's interest.
(i) The public adjuster shall give the insured written
notice of the insured's rights as a consumer under the law of
this State.
(j) A public adjuster shall not provide services until a
written contract with the insured has been executed, on a form
filed with and approved by the Director. At the option of the
insured, any such contract that is executed within 5 business
days after conclusion of the loss producing occurrence shall be
voidable for 10 days after execution. The insured may void the
contract by notifying the public adjuster in writing by (i)
registered or certified mail, return receipt requested, to the
address shown on the contract or (ii) personally serving the
notice on the public adjuster.
(k) If the insured exercises the right to rescind the
contract, anything of value given by the insured under the
contract will be returned to the insured within 15 business
days following the receipt by the public adjuster of the

SB0660 Engrossed - 26 - LRB096 06719 MJR 16803 b
cancellation notice.
(215 ILCS 5/1580 new)
Sec. 1580. Escrow or trust accounts. A public adjuster who
receives, accepts, or holds any funds on behalf of an insured
towards the settlement of a claim for loss or damage shall
deposit the funds in a non-interest bearing escrow or trust
account in a financial institution that is insured by an agency
of the federal government in the public adjuster's home state
or where the loss occurred.
(215 ILCS 5/1585 new)
Sec. 1585. Record retention.
(a) A public adjuster shall maintain a complete record of
each transaction as a public adjuster. The records required by
this Section shall include the following:
(1) name of the insured;
(2) date, location and amount of the loss;
(3) a copy of the contract between the public adjuster
and insured and a copy of the separate disclosure document;
(4) name of the insurer, amount, expiration date and
number of each policy carried with respect to the loss;
(5) itemized statement of the insured's recoveries;
(6) itemized statement of all compensation received by
the public adjuster, from any source whatsoever, in
connection with the loss;

SB0660 Engrossed - 27 - LRB096 06719 MJR 16803 b
(7) a register of all monies received, deposited,
disbursed, or withdrawn in connection with a transaction
with an insured, including fees transfers and
disbursements from a trust account and all transactions
concerning all interest bearing accounts;
(8) name of public adjuster who executed the contract;
(9) name of the attorney representing the insured, if
applicable, and the name of the claims representatives of
the insurance company; and
(10) evidence of financial responsibility in a format
prescribed by the Director.
(b) Records shall be maintained for at least 7 years after
the termination of the transaction with an insured and shall be
open to examination by the Director at all times.
(c) Records submitted to the Director in accordance with
this Section that contain information identified in writing as
proprietary by the public adjuster shall be treated as
confidential by the Director and shall not be subject to the
Freedom of Information Act.
(215 ILCS 5/1590 new)
Sec. 1590. Standards of conduct of public adjuster.
(a) A public adjuster is obligated, under his or her
license, to serve with objectivity and complete loyalty for the
interests of his client alone, and to render to the insured
such information, counsel, and service, as within the

SB0660 Engrossed - 28 - LRB096 06719 MJR 16803 b
knowledge, understanding, and opinion in good faith of the
licensee, as will best serve the insured's insurance claim
needs and interest.
(b) A public adjuster may not propose or attempt to propose
to any person that the public adjuster represent that person
while a loss-producing occurrence is continuing, nor while the
fire department or its representatives are engaged at the
damaged premises, nor between the hours of 7:00 p.m. and 8:00
a.m.
(c) A public adjuster shall not permit an unlicensed
employee or representative of the public adjuster to conduct
business for which a license is required under this Article.
(d) A public adjuster shall not have a direct or indirect
financial interest in any aspect of the claim, other than the
salary, fee, commission, or other consideration established in
the written contract with the insured, unless full written
disclosure has been made to the insured as set forth in
subsection (g) of Section 1575.
(e) A public adjuster shall not acquire any interest in the
salvage of property subject to the contract with the insured
unless the public adjuster obtains written permission from the
insured after settlement of the claim with the insurer as set
forth in subsection (g) of Section 1575 of this Article.
(f) The public adjuster shall abstain from referring or
directing the insured to get needed repairs or services in
connection with a loss from any person, unless disclosed to the

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insured:
(1) with whom the public adjuster has a financial
interest; or
(2) from whom the public adjuster may receive direct or
indirect compensation for the referral.
(g) The public adjuster shall disclose to an insured if he
or she has any interest or will be compensated by any
construction firm, salvage firm, building appraisal firm,
motor vehicle repair shop, or any other firm that performs any
work in conjunction with damages caused by the insured loss.
The word "firm" shall include any corporation, partnership,
association, joint-stock company or individual as set forth in
Section 1575 of this Article.
(h) Any compensation or anything of value in connection
with an insured's specific loss that will be received by a
public adjuster shall be disclosed by the public adjuster to
the insured in writing including the source and amount of any
such compensation.
(i) In all cases where the loss giving rise to the claim
for which the public adjuster was retained arise from damage to
a personal residence, the insurance proceeds shall be delivered
in person to the named insured or his or her designee. Where
proceeds paid by an insurance company are paid jointly to the
insured and the public adjuster, the insured shall release such
portion of the proceeds that are due the public adjuster within
30 calendar days after the insured's receipt of the insurance

SB0660 Engrossed - 30 - LRB096 06719 MJR 16803 b
company's check, money order, draft, or release of funds. If
the proceeds are not so released to the insured within 30
calendar days, the insured shall provide the public adjuster
with a written explanation of the reason for the delay.
(j) Public adjusters shall adhere to the following general
ethical requirements:
(1) a public adjuster shall not undertake the
adjustment of any claim if the public adjuster is not
competent and knowledgeable as to the terms and conditions
of the insurance coverage, or which otherwise exceeds the
public adjuster's current expertise;
(2) a public adjuster shall not knowingly make any oral
or written material misrepresentations or statements which
are false or maliciously critical and intended to injure
any person engaged in the business of insurance to any
insured client or potential insured client;
(3) no public adjuster, while so licensed by the
Department, may represent or act as a company adjuster or
independent adjuster on the same claim;
(4) the contract shall not be construed to prevent an
insured from pursuing any civil remedy after the 3-business
day revocation or cancellation period;
(5) a public adjuster shall not enter into a contract
or accept a power of attorney that vests in the public
adjuster the effective authority to choose the persons who
shall perform repair work;

SB0660 Engrossed - 31 - LRB096 06719 MJR 16803 b
(6) a public adjuster shall ensure that all contracts
for the public adjuster's services are in writing and set
forth all terms and conditions of the engagement; and
(7) a public adjuster shall not advance money or any
valuable consideration, except emergency services to an
insured pending adjustment of a claim.
(k) A public adjuster may not agree to any loss settlement
without the insured's knowledge and consent.
(215 ILCS 5/1595 new)
Sec. 1595. Reporting of actions.
(a) The public adjuster shall report to the Director any
administrative action taken against the public adjuster in
another jurisdiction or by another governmental agency in this
State within 30 days of the final disposition of the matter.
This report shall include a copy of the order, consent to
order, or other relevant legal documents.
(b) Within 30 days of the initial pretrial hearing date,
the public adjuster shall report to the Director any criminal
prosecution of the public adjuster taken in any jurisdiction.
The report shall include a copy of the initial complaint filed,
the order resulting from the hearing, and any other relevant
legal documents.
(215 ILCS 5/1600 new)
Sec. 1600. Examinations.

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(a) The Director shall have the power to examine any
applicant or any person licensed or registered pursuant to this
Article.
(b) Every person being examined and its officers,
directors, and members must provide to the Director convenient
and free access, at all reasonable hours, to all books,
records, documents, and other papers relating to its public
adjusting affairs. The officers, directors, members, and
employees must facilitate and aid in such examinations so far
as it is in their power to do so.
(c) Examiners may be designated by the Director. Such
examiners shall make their reports to the Director pursuant to
this Section. Any report alleging substantive violations shall
be in writing and shall be based upon the facts ascertained
from the books, records, documents, papers, and other evidence
obtained by the examiners or ascertained from the testimony of
the officers, directors, members, or other individuals
examined under oath or ascertained by notarized affidavits
received by the examiners. The reports shall be verified by the
examiners.
(215 ILCS 5/1605 new)
Sec. 1605. Injunctive relief. Any person who acts as or
holds himself out to be a public adjuster without holding a
valid and current license to do so is hereby declared to be
inimical to the public welfare and to constitute a public

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nuisance. The Director may report such practice to the Attorney
General of the State of Illinois whose duty it is to apply
forthwith by complaint on relation of the Director in the name
of the people of the State of Illinois, as plaintiff, for
injunctive relief in the circuit court of the county where such
practice occurred to enjoin the person from engaging in such
practice; and upon the filing of a verified petition in such
court, the court, if satisfied by affidavit or otherwise that
the person has been engaged in such practice without a valid
and current license to do so, may enter a temporary restraining
order without notice or bond enjoining the defendant from such
further practice. A copy of the verified complaint shall be
served upon the defendant and the proceedings shall thereafter
be conducted as in other civil cases. If it is established that
the defendant has been or is engaged in such unlawful practice,
then the court may enter an order or judgment perpetually
enjoining the defendant from such further practice. In all
proceedings hereunder, the court, in its discretion, may
apportion the costs among the parties interested in the action,
including the costs of filing the complaint, service of
process, witness fees and expenses, court reporter charges, and
reasonable attorney fees. In case of violation of any
injunctive order entered under the provisions of this Section,
the court may try and punish the offender for contempt of
court. Such injunction proceedings shall be in addition to, and
not in lieu of, all penalties and other remedies.

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(215 ILCS 5/1610 new)
Sec. 1610. Additional penalties. In addition to any other
penalty set forth in this Article, any person violating Section
1605 of this Code shall be guilty of a Class A misdemeanor and
any person misappropriating or converting any monies collected
as a public adjuster, whether licensed or not, shall be guilty
of a Class 4 felony.
(215 ILCS 5/1615 new)
Sec. 1615. Rules. The Director shall promulgate reasonable
rules as are necessary or proper to carry out the purposes of
this Article.
(215 ILCS 5/Art. XXXI.75 rep.)
Section 910. The Illinois Insurance Code is amended by
repealing Article XXXI.75.
Section 997. Severability. The provisions of this Act are
severable under Section 1.31 of the Statute on Statutes.