Public Act 101-0600
 
SB0670 EnrolledLRB101 04430 SMS 49438 b

    AN ACT concerning regulation.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Freedom of Information Act is amended by
changing Section 7.5 as follows:
 
    (5 ILCS 140/7.5)
    Sec. 7.5. Statutory exemptions. To the extent provided for
by the statutes referenced below, the following shall be exempt
from inspection and copying:
        (a) All information determined to be confidential
    under Section 4002 of the Technology Advancement and
    Development Act.
        (b) Library circulation and order records identifying
    library users with specific materials under the Library
    Records Confidentiality Act.
        (c) Applications, related documents, and medical
    records received by the Experimental Organ Transplantation
    Procedures Board and any and all documents or other records
    prepared by the Experimental Organ Transplantation
    Procedures Board or its staff relating to applications it
    has received.
        (d) Information and records held by the Department of
    Public Health and its authorized representatives relating
    to known or suspected cases of sexually transmissible
    disease or any information the disclosure of which is
    restricted under the Illinois Sexually Transmissible
    Disease Control Act.
        (e) Information the disclosure of which is exempted
    under Section 30 of the Radon Industry Licensing Act.
        (f) Firm performance evaluations under Section 55 of
    the Architectural, Engineering, and Land Surveying
    Qualifications Based Selection Act.
        (g) Information the disclosure of which is restricted
    and exempted under Section 50 of the Illinois Prepaid
    Tuition Act.
        (h) Information the disclosure of which is exempted
    under the State Officials and Employees Ethics Act, and
    records of any lawfully created State or local inspector
    general's office that would be exempt if created or
    obtained by an Executive Inspector General's office under
    that Act.
        (i) Information contained in a local emergency energy
    plan submitted to a municipality in accordance with a local
    emergency energy plan ordinance that is adopted under
    Section 11-21.5-5 of the Illinois Municipal Code.
        (j) Information and data concerning the distribution
    of surcharge moneys collected and remitted by carriers
    under the Emergency Telephone System Act.
        (k) Law enforcement officer identification information
    or driver identification information compiled by a law
    enforcement agency or the Department of Transportation
    under Section 11-212 of the Illinois Vehicle Code.
        (l) Records and information provided to a residential
    health care facility resident sexual assault and death
    review team or the Executive Council under the Abuse
    Prevention Review Team Act.
        (m) Information provided to the predatory lending
    database created pursuant to Article 3 of the Residential
    Real Property Disclosure Act, except to the extent
    authorized under that Article.
        (n) Defense budgets and petitions for certification of
    compensation and expenses for court appointed trial
    counsel as provided under Sections 10 and 15 of the Capital
    Crimes Litigation Act. This subsection (n) shall apply
    until the conclusion of the trial of the case, even if the
    prosecution chooses not to pursue the death penalty prior
    to trial or sentencing.
        (o) Information that is prohibited from being
    disclosed under Section 4 of the Illinois Health and
    Hazardous Substances Registry Act.
        (p) Security portions of system safety program plans,
    investigation reports, surveys, schedules, lists, data, or
    information compiled, collected, or prepared by or for the
    Regional Transportation Authority under Section 2.11 of
    the Regional Transportation Authority Act or the St. Clair
    County Transit District under the Bi-State Transit Safety
    Act.
        (q) Information prohibited from being disclosed by the
    Personnel Record Review Act.
        (r) Information prohibited from being disclosed by the
    Illinois School Student Records Act.
        (s) Information the disclosure of which is restricted
    under Section 5-108 of the Public Utilities Act.
        (t) All identified or deidentified health information
    in the form of health data or medical records contained in,
    stored in, submitted to, transferred by, or released from
    the Illinois Health Information Exchange, and identified
    or deidentified health information in the form of health
    data and medical records of the Illinois Health Information
    Exchange in the possession of the Illinois Health
    Information Exchange Authority due to its administration
    of the Illinois Health Information Exchange. The terms
    "identified" and "deidentified" shall be given the same
    meaning as in the Health Insurance Portability and
    Accountability Act of 1996, Public Law 104-191, or any
    subsequent amendments thereto, and any regulations
    promulgated thereunder.
        (u) Records and information provided to an independent
    team of experts under the Developmental Disability and
    Mental Health Safety Act (also known as Brian's Law).
        (v) Names and information of people who have applied
    for or received Firearm Owner's Identification Cards under
    the Firearm Owners Identification Card Act or applied for
    or received a concealed carry license under the Firearm
    Concealed Carry Act, unless otherwise authorized by the
    Firearm Concealed Carry Act; and databases under the
    Firearm Concealed Carry Act, records of the Concealed Carry
    Licensing Review Board under the Firearm Concealed Carry
    Act, and law enforcement agency objections under the
    Firearm Concealed Carry Act.
        (w) Personally identifiable information which is
    exempted from disclosure under subsection (g) of Section
    19.1 of the Toll Highway Act.
        (x) Information which is exempted from disclosure
    under Section 5-1014.3 of the Counties Code or Section
    8-11-21 of the Illinois Municipal Code.
        (y) Confidential information under the Adult
    Protective Services Act and its predecessor enabling
    statute, the Elder Abuse and Neglect Act, including
    information about the identity and administrative finding
    against any caregiver of a verified and substantiated
    decision of abuse, neglect, or financial exploitation of an
    eligible adult maintained in the Registry established
    under Section 7.5 of the Adult Protective Services Act.
        (z) Records and information provided to a fatality
    review team or the Illinois Fatality Review Team Advisory
    Council under Section 15 of the Adult Protective Services
    Act.
        (aa) Information which is exempted from disclosure
    under Section 2.37 of the Wildlife Code.
        (bb) Information which is or was prohibited from
    disclosure by the Juvenile Court Act of 1987.
        (cc) Recordings made under the Law Enforcement
    Officer-Worn Body Camera Act, except to the extent
    authorized under that Act.
        (dd) Information that is prohibited from being
    disclosed under Section 45 of the Condominium and Common
    Interest Community Ombudsperson Act.
        (ee) Information that is exempted from disclosure
    under Section 30.1 of the Pharmacy Practice Act.
        (ff) Information that is exempted from disclosure
    under the Revised Uniform Unclaimed Property Act.
        (gg) Information that is prohibited from being
    disclosed under Section 7-603.5 of the Illinois Vehicle
    Code.
        (hh) Records that are exempt from disclosure under
    Section 1A-16.7 of the Election Code.
        (ii) Information which is exempted from disclosure
    under Section 2505-800 of the Department of Revenue Law of
    the Civil Administrative Code of Illinois.
        (jj) Information and reports that are required to be
    submitted to the Department of Labor by registering day and
    temporary labor service agencies but are exempt from
    disclosure under subsection (a-1) of Section 45 of the Day
    and Temporary Labor Services Act.
        (kk) Information prohibited from disclosure under the
    Seizure and Forfeiture Reporting Act.
        (ll) Information the disclosure of which is restricted
    and exempted under Section 5-30.8 of the Illinois Public
    Aid Code.
        (mm) Records that are exempt from disclosure under
    Section 4.2 of the Crime Victims Compensation Act.
        (nn) Information that is exempt from disclosure under
    Section 70 of the Higher Education Student Assistance Act.
        (oo) Communications, notes, records, and reports
    arising out of a peer support counseling session prohibited
    from disclosure under the First Responders Suicide
    Prevention Act.
        (pp) Names and all identifying information relating to
    an employee of an emergency services provider or law
    enforcement agency under the First Responders Suicide
    Prevention Act.
        (qq) (oo) Information and records held by the
    Department of Public Health and its authorized
    representatives collected under the Reproductive Health
    Act.
        (rr) (oo) Information that is exempt from disclosure
    under the Cannabis Regulation and Tax Act.
        (ss) (oo) Data reported by an employer to the
    Department of Human Rights pursuant to Section 2-108 of the
    Illinois Human Rights Act.
        (tt) (oo) Recordings made under the Children's
    Advocacy Center Act, except to the extent authorized under
    that Act.
        (uu) (oo) Information that is exempt from disclosure
    under Section 50 of the Sexual Assault Evidence Submission
    Act.
        (vv) (oo) Information that is exempt from disclosure
    under subsections (f) and (j) of Section 5-36 of the
    Illinois Public Aid Code.
        (ww) (oo) Information that is exempt from disclosure
    under Section 16.8 of the State Treasurer Act.
        (xx) Information that is exempt from disclosure or
    information that shall not be made public under the
    Illinois Insurance Code.
(Source: P.A. 100-20, eff. 7-1-17; 100-22, eff. 1-1-18;
100-201, eff. 8-18-17; 100-373, eff. 1-1-18; 100-464, eff.
8-28-17; 100-465, eff. 8-31-17; 100-512, eff. 7-1-18; 100-517,
eff. 6-1-18; 100-646, eff. 7-27-18; 100-690, eff. 1-1-19;
100-863, eff. 8-14-18; 100-887, eff. 8-14-18; 101-13, eff.
6-12-19; 101-27, eff. 6-25-19; 101-81, eff. 7-12-19; 101-221,
eff. 1-1-20; 101-236, eff. 1-1-20; 101-375, eff. 8-16-19;
101-377, eff. 8-16-19; 101-452, eff. 1-1-20; 101-466, eff.
1-1-20; revised 9-25-19.)
 
    Section 10. The Illinois Insurance Code is amended by
adding Article VIII.33 as follows:
 
    (215 ILCS 5/Art. VIII.33 heading new)
ARTICLE VIII 1/3. Corporate Governance Annual Disclosure Law

 
    (215 ILCS 5/130.1 new)
    Sec. 130.1. Short title. This Article may be cited as the
Corporate Governance Annual Disclosure Law.
 
    (215 ILCS 5/130.2 new)
    Sec. 130.2. Purpose and scope. The purpose of this Article
is to:
        (1) provide the Director a summary of an insurer's or
    insurance group's corporate governance structure,
    policies, and practices to permit the Director to gain and
    maintain an understanding of the insurer's corporate
    governance framework;
        (2) outline the requirements for completing a
    corporate governance annual disclosure with the Director;
        (3) provide for the confidential treatment of the
    corporate governance annual disclosure and related
    information that will contain confidential and sensitive
    information related to an insurer's or insurance group's
    internal operations and proprietary and trade-secret
    information that, if made public, could potentially cause
    the insurer or insurance group competitive harm or
    disadvantage.
    Nothing in this Article shall be construed to prescribe or
impose corporate governance standards and internal procedures
beyond that which is required under applicable State corporate
law. Notwithstanding the foregoing, nothing in this Article
shall be construed to limit the Director's authority or the
rights or obligations of third parties under Sections 131.21,
132 through 132.7, and 401 through 403. The requirements of
this Article apply to all insurers domiciled in this State.
 
    (215 ILCS 5/130.3 new)
    Sec. 130.3. Definitions. As used in this Article:
    "Director" means the Director of Insurance.
    "Corporate governance annual disclosure" means a
confidential report filed by the insurer or insurance group
made in accordance with the requirements of this Article.
    "Insurance group" means those insurers and affiliates
included within an insurance holding company system as defined
in Section 131.1.
    "Insurer" has the same meaning given to "company" in
Section 2, except that it does not include agencies,
authorities, or instrumentalities of the United States, its
possessions and territories, the Commonwealth of Puerto Rico,
the District of Columbia, or a state or political subdivision
of a state.
    "ORSA summary report" means the own risk and solvency
assessment report filed in accordance with Article VIII 1/4.
 
    (215 ILCS 5/130.4 new)
    Sec. 130.4. Disclosure requirement.
    (a) An insurer, or the insurance group of which the insurer
is a member, shall, no later than June 1 of each calendar year,
submit to the Director a corporate governance annual disclosure
that contains the information described in subsection (b) of
Section 130.5. Notwithstanding any request from the Director
made pursuant to subsection (c), if the insurer is a member of
an insurance group, the insurer shall submit the report
required by this Section to the Director of the lead state for
the insurance group, in accordance with the laws of the lead
state, as determined by the procedures outlined in the most
recent Financial Analysis Handbook adopted by the National
Association of Insurance Commissioners.
    (b) The corporate governance annual disclosure must
include a signature of the insurer's or insurance group's chief
executive officer or corporate secretary attesting to the best
of that individual's belief and knowledge that the insurer has
implemented the corporate governance practices required by
this Section and that a copy of the disclosure has been
provided to the insurer's board of directors or the appropriate
committee thereof.
    (c) An insurer not required to submit a corporate
governance annual disclosure under this Section shall do so
upon the Director's request.
    (d) For purposes of completing the corporate governance
annual disclosure, the insurer or insurance group may provide
information regarding corporate governance at the ultimate
controlling parent level, an intermediate holding company
level, or the individual legal entity level, depending upon how
the insurer or insurance group has structured its system of
corporate governance. The insurer or insurance group is
encouraged to make the corporate governance annual disclosure
at the level at which the insurer's or insurance group's risk
appetite is determined, the level at which the earnings,
capital, liquidity, operations, and reputation of the insurer
are overseen collectively and at which the supervision of those
factors is coordinated and exercised, or the level at which
legal liability for failure of general corporate governance
duties would be placed. If the insurer or insurance group
determines the level of reporting based on these criteria, it
shall indicate which of the 3 criteria was used to determine
the level of reporting and explain any subsequent changes in
the level of reporting.
    (e) The review of the corporate governance annual
disclosure and any additional requests for information shall be
made through the lead state as determined by the procedures
within the most recent Financial Analysis Handbook adopted by
the National Association of Insurance Commissioners.
    (f) Insurers providing information substantially similar
to the information required by this Article in other documents
provided to the Director, including proxy statements filed in
conjunction with the requirements of Section 131.13 or other
State or federal filings provided to the Department, are not
required to duplicate that information in the corporate
governance annual disclosure but are only required to
cross-reference the document in which the information is
included.
 
    (215 ILCS 5/130.5 new)
    Sec. 130.5. Contents of corporate governance annual
disclosure.
    (a) The insurer or insurance group has discretion over the
responses to the corporate governance annual disclosure
inquiries if the corporate governance annual disclosure
contains the material information necessary to permit the
Director to gain an understanding of the insurer's or insurance
group's corporate governance structure, policies, and
practices. The Director may request additional information
that he or she deems material and necessary to provide the
Director with a clear understanding of the corporate governance
policies, the reporting or information system, or controls
implementing those policies.
    (b) Notwithstanding subsection (a), the corporate
governance annual disclosure shall be prepared in a manner
consistent with rules adopted by the Director. Documentation
and supporting information shall be maintained and made
available upon examination or upon the request of the Director.
    (c) The Director may retain, at the insurer's expense,
third-party consultants, including attorneys, actuaries,
accountants, and other experts not otherwise a part of the
Director's staff, as may be reasonably necessary to assist the
Director in reviewing the corporate governance annual
disclosure and related information or the insurer's compliance
with this Article. Any persons retained shall be under the
direction and control of the Director and shall act only in an
advisory capacity.
 
    (215 ILCS 5/130.6 new)
    Sec. 130.6. Confidentiality.
    (a) Documents, materials, or other information, including
the corporate governance annual disclosure, in the possession
or control of the Department that are obtained by, created by,
or disclosed to the Director or any other person under this
Article are recognized by this State as being proprietary and
to contain trade secrets. All such documents, materials, or
other information shall be confidential by law and privileged,
shall not be subject to the Freedom of Information Act, shall
not be subject to subpoena, and shall not be subject to
discovery or admissible in evidence in any private civil
action. However, the Director is authorized to use the
documents, materials, or other information in furtherance of
any regulatory or legal action brought as a part of the
Director's official duties. The Director shall not otherwise
make the documents, materials, or other information public
without the prior written consent of the insurer.
    (b) Neither the Director nor any person who received
documents, materials, or other corporate governance annual
disclosure-related information through examination or
otherwise, while acting under the authority of the Director or
with whom such documents, materials, or other information are
shared pursuant to this Article, shall be permitted or required
to testify in any private civil action concerning any
confidential documents, materials, or information subject to
subsection (a).
    (c) In order to assist in the performance of the Director's
regulatory duties, the Director may:
        (1) upon request, share documents, materials, or other
    corporate governance annual disclosure-related
    information, including the confidential and privileged
    documents, materials, and information subject to
    subsection (a), including proprietary and trade-secret
    documents and materials with other state, federal, and
    international financial regulatory agencies, including
    members of any supervisory college as defined in subsection
    (c) of Section 131.20, with the National Association of
    Insurance Commissioners, and with third-party consultants,
    if the recipient agrees in writing to maintain the
    confidentiality and privileged status of the corporate
    governance annual disclosure-related documents, materials,
    or other information and has verified in writing the legal
    authority to maintain confidentiality; and
        (2) receive documents, materials, or other corporate
    governance annual disclosure-related information,
    including otherwise confidential and privileged documents,
    materials, and information, including proprietary and
    trade-secret information and documents from regulatory
    officials of other state, federal, and international
    financial regulatory agencies, including members of any
    supervisory college as defined in subsection (c) of Section
    131.20, and from the National Association of Insurance
    Commissioners, and shall maintain as confidential or
    privileged any documents, materials, or information
    received with notice or the understanding that it is
    confidential or privileged under the laws of the
    jurisdiction that is the source of the document, material,
    or information.
    (d) A written agreement with the National Association of
Insurance Commissioners or a third-party consultant governing
sharing and use of information provided pursuant to this
Article shall:
        (1) include specific procedures and protocols for
    maintaining the confidentiality and security of corporate
    governance annual disclosure-related information shared
    with the National Association of Insurance Commissioners
    or a third-party consultant pursuant to this Article,
    including procedures and protocols for sharing by the
    National Association of Insurance Commissioners only with
    other state regulators from states in which the insurance
    group has domiciled insurers; the agreement shall provide
    that the recipient agrees in writing to maintain the
    confidentiality and privileged status of the corporate
    governance annual disclosure-related documents, materials,
    or other information and has verified in writing the legal
    authority to maintain confidentiality;
        (2) specify that ownership of the corporate governance
    annual disclosure-related information shared with the
    National Association of Insurance Commissioners or a
    third-party consultant remains with the Director and that
    the National Association of Insurance Commissioners' or
    third-party consultant's use of the information is subject
    to the direction of the Director;
        (3) prohibit the National Association of Insurance
    Commissioners or a third-party consultant from storing the
    information shared pursuant to this Article in a permanent
    database after the underlying analysis is completed;
        (4) require the National Association of Insurance
    Commissioners or a third-party consultant to provide
    prompt notice to the Director and to the insurer or
    insurance group regarding any subpoena, request for
    disclosure, or request for production of the insurer's or
    insurance group's corporate governance annual
    disclosure-related information;
        (5) require the National Association of Insurance
    Commissioners or a third-party consultant to consent to
    intervention by an insurer in any judicial or
    administrative action in which the National Association of
    Insurance Commissioners or a third-party consultant may be
    required to disclose confidential information about the
    insurer shared with the National Association of Insurance
    Commissioners or a third-party consultant pursuant to this
    Article; and
        (6) require the National Association of Insurance
    Commissioners or a third-party consultant to obtain
    written consent of the insurer before making any of the
    insurer's corporate governance annual disclosure-related
    information public.
    (e) The sharing of information and documents by the
Director pursuant to this Article shall not constitute a
delegation of regulatory authority or rulemaking, and the
Director is solely responsible for the administration,
execution, and enforcement of this Article.
    (f) No waiver of any applicable privilege or claim of
confidentiality in the documents, proprietary and trade-secret
materials, or other corporate governance annual
disclosure-related information shall occur as a result of
disclosure of such information or documents to the Director
under this Section or as a result of sharing as authorized in
this Article.
    (g) Documents, materials, or other information in the
possession or control of the National Association of Insurance
Commissioners or any third-party consultants pursuant to this
Article shall be confidential by law and privileged, shall not
be subject to the Freedom of Information Act, shall not be
subject to subpoena, and shall not be subject to discovery or
admissible in evidence in any private civil action.
 
    (215 ILCS 5/130.7 new)
    Sec. 130.7. Sanctions. Any insurer failing, without just
cause, to timely file the corporate governance annual
disclosure as required in this Article shall be required, after
notice and a hearing, to pay a penalty of $200 for each day's
delay, to be recovered by the Director. Any penalty recovered
shall be paid into the General Revenue Fund. The Director may
reduce the penalty if the insurer demonstrates to the Director
that the imposition of the penalty would constitute a financial
hardship to the insurer.
 
    Section 99. Effective date. This Act takes effect upon
becoming law.