Bill Text: IL SB2877 | 2011-2012 | 97th General Assembly | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Amends the Insurance Code in the Article concerning insurance holding company systems. Makes changes to the definitions. Provides that a domestic company, either by itself or in cooperation with one or more persons, may organize or acquire one or more subsidiaries, and that the subsidiaries may conduct any kind of business or businesses and their authority to do so shall not be limited by reason of the fact that they are subsidiaries of a domestic company. Makes changes to the provisions concerning a domestic company's permitted investments. Includes certain filing requirements in the provision concerning the acquisition of control of or merger with a domestic company. Makes changes to provisions concerning the statement that is required to be filed with the Director of Insurance. Deletes certain provisions concerning deposits made with the Director, orders entered by the Director, and reports of potential adverse economic impact made to the General Assembly by the Director. Makes changes to the provisions concerning certain violations, judicial jurisdiction, acquisitions, registration statements, reporting materials, termination of registration, disclaimers, prior notification, officers and directors, examination, confidential treatment, voting , sanctions, and judicial review. . Sets forth provisions concerning summary filing, enterprise risk filing, violations, and supervisory colleges. Repeals a provision concerning the delivery of certain filings. Contains a severability provision. Effective on January 1, 2013.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Failed) 2013-01-08 - Session Sine Die [SB2877 Detail]
Download: Illinois-2011-SB2877-Amended.html
Bill Title: Amends the Insurance Code in the Article concerning insurance holding company systems. Makes changes to the definitions. Provides that a domestic company, either by itself or in cooperation with one or more persons, may organize or acquire one or more subsidiaries, and that the subsidiaries may conduct any kind of business or businesses and their authority to do so shall not be limited by reason of the fact that they are subsidiaries of a domestic company. Makes changes to the provisions concerning a domestic company's permitted investments. Includes certain filing requirements in the provision concerning the acquisition of control of or merger with a domestic company. Makes changes to provisions concerning the statement that is required to be filed with the Director of Insurance. Deletes certain provisions concerning deposits made with the Director, orders entered by the Director, and reports of potential adverse economic impact made to the General Assembly by the Director. Makes changes to the provisions concerning certain violations, judicial jurisdiction, acquisitions, registration statements, reporting materials, termination of registration, disclaimers, prior notification, officers and directors, examination, confidential treatment, voting , sanctions, and judicial review. . Sets forth provisions concerning summary filing, enterprise risk filing, violations, and supervisory colleges. Repeals a provision concerning the delivery of certain filings. Contains a severability provision. Effective on January 1, 2013.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Failed) 2013-01-08 - Session Sine Die [SB2877 Detail]
Download: Illinois-2011-SB2877-Amended.html
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1 | AMENDMENT TO SENATE BILL 2877
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2 | AMENDMENT NO. ______. Amend Senate Bill 2877, AS AMENDED, | ||||||
3 | as follows:
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4 | in Section 5, Sec. 131.20a, by replacing paragraph (1)(a) with | ||||||
5 | the following:
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6 | "(1) (a) The following transactions involving between a | ||||||
7 | domestic
company and any person in its insurance holding | ||||||
8 | company system , including amendments or modifications of | ||||||
9 | affiliate agreements previously filed pursuant to this | ||||||
10 | Section, which are subject to any materiality standards | ||||||
11 | contained in this Section, may not be entered
into unless the | ||||||
12 | company has notified the Director in writing of its
intention | ||||||
13 | to enter into such transaction at least 30 days prior thereto, | ||||||
14 | or
such shorter period as the Director may permit, and the | ||||||
15 | Director has not
disapproved it within such period . The notice | ||||||
16 | for amendments or modifications shall include the reasons for | ||||||
17 | the change and the financial impact on the domestic company. |
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1 | Informal notice shall be reported, within 30 days after a | ||||||
2 | termination of a previously filed agreement, to the Director | ||||||
3 | for determination of the type of filing required, if any :
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4 | (i) Sales, purchases, exchanges of assets, loans or | ||||||
5 | extensions of credit,
guarantees, investments, or any | ||||||
6 | other transaction , except dividends, (A) that involves the
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7 | transfer of assets from or liabilities to a company (A) | ||||||
8 | equal to or exceeding the
lesser of 3% of the
company's | ||||||
9 | admitted assets or 25% of its surplus as regards
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10 | policyholders as
of the 31st day of December next preceding | ||||||
11 | or (B) that is proposed when the
domestic
company is not | ||||||
12 | eligible to declare and pay a dividend or other | ||||||
13 | distribution
pursuant to the provisions of Section 27.
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14 | (ii) Loans or extensions of credit to any person that | ||||||
15 | is not an
affiliate (A) that involve the lesser of 3% of | ||||||
16 | the company's
admitted assets
or 25% of the company's | ||||||
17 | surplus, each as of the 31st day of December next
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18 | preceding, made with the agreement or understanding that | ||||||
19 | the proceeds of
such transactions, in whole or in | ||||||
20 | substantial part, are to be used to make
loans or | ||||||
21 | extensions of credit to, to purchase assets of, or to make
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22 | investments in, any affiliate of the company making such | ||||||
23 | loans or extensions of
credit or (B) that are proposed when | ||||||
24 | the domestic company is not eligible to
declare and
pay a | ||||||
25 | dividend or other distribution pursuant to the provisions | ||||||
26 | of
Section 27.
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1 | (iii) Reinsurance agreements or modifications thereto, | ||||||
2 | including all reinsurance pooling agreements, reinsurance | ||||||
3 | agreements in which the reinsurance premium or a change in | ||||||
4 | the company's liabilities, or the projected reinsurance | ||||||
5 | premium or a change in the company's liabilities in any of | ||||||
6 | the next 3 years, equals or exceeds 5% of the company's | ||||||
7 | surplus as regards policyholders, as of the 31st day of | ||||||
8 | December next preceding, including those
agreements that | ||||||
9 | may require as consideration the transfer of assets from a | ||||||
10 | company an
insurer to a nonaffiliate, if an agreement or | ||||||
11 | understanding exists between the company
insurer and | ||||||
12 | nonaffiliate that any portion of those assets will be | ||||||
13 | transferred
to one or more affiliates of the company | ||||||
14 | insurer .
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15 | (iv) All management agreements, service contracts, | ||||||
16 | other than agency contracts, tax allocation agreements, | ||||||
17 | all reinsurance allocation agreements related to | ||||||
18 | reinsurance agreements required to be filed under this | ||||||
19 | Section, and all cost-sharing
arrangements , and any other | ||||||
20 | contracts providing for the rendering of services
on a | ||||||
21 | regular systematic basis .
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22 | (v) Direct or indirect acquisitions or investments in a | ||||||
23 | person that controls the company, or in an affiliate of the | ||||||
24 | company, in an amount which, together with its present | ||||||
25 | holdings in such investments, exceeds 2.5% of the company's | ||||||
26 | surplus as regards policyholders. Direct or indirect |
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1 | acquisitions or investments in subsidiaries acquired | ||||||
2 | pursuant to Section 131.2 of this Article (or authorized | ||||||
3 | under any other Section of this Code), or in non-subsidiary | ||||||
4 | insurance affiliates that are subject to the provisions of | ||||||
5 | this Article, are exempt from this requirement. | ||||||
6 | (vi) Any series of the previously described | ||||||
7 | transactions that are
substantially similar to each other, | ||||||
8 | that take place within any 180 day period,
and that in | ||||||
9 | total are equal to or exceed the lesser of 3% of the | ||||||
10 | domestic company's
insurer's
admitted assets or 25% of its | ||||||
11 | policyholders surplus, as of the 31st day of the
December | ||||||
12 | next preceding.
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13 | (vii) (vi) Any other material transaction that the
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14 | Director by rule determines
might render the company's | ||||||
15 | surplus as regards policyholders
unreasonable in
relation | ||||||
16 | to the company's outstanding liabilities and inadequate to | ||||||
17 | its
financial needs or may otherwise adversely affect the | ||||||
18 | interests of the
company's policyholders or shareholders.
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19 | Nothing herein contained shall be deemed to authorize or | ||||||
20 | permit any
transactions that, in the case of a company an | ||||||
21 | insurer not a member of the same holding
company system, would | ||||||
22 | be otherwise contrary to law.".
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