HB5450 102ND GENERAL ASSEMBLY

LRB102 24154 BMS 33380 b

102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB5450

Introduced 1/31/2022, by Rep. Michael Halpin

SYNOPSIS AS INTRODUCED:

New Act
215 ILCS 5/500-35
215 ILCS 5/1565
225 ILCS 454/5-70

Creates the Improving Access to Flood Insurance Act. Provides that each insurance producer, public adjuster, managing broker, broker, and employee of a lender shall participate in at least 3 hours of National Flood Insurance Program training. Provides that the insurance producer, public adjuster, managing broker, broker, or lender shall submit evidence of satisfaction of the requirement to the entity that regulates that profession. Requires the Department of Insurance to: provide a list of pre-approved courses available through the Federal Emergency Management Agency's Emergency Management Institute and other educational institutions the Department determines provide information and training equivalent to the Federal Emergency Management Agency's Emergency Management Institute; and to provide instructions for an insurance producer, public adjuster, managing broker, broker, lender, or employee of a lender to apply and secure credit for course work that meets equivalent educational goals but that is not included on the pre-approved list. Provides that a violation of the Act shall be considered a violation any other law under which the insurance producer, public adjuster, managing broker, broker, or lender is licensed, chartered, or organized. Makes conforming changes in the Illinois Insurance Code and the Real Estate License Act of 2000.

A BILL FOR

AN ACT concerning regulation.

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

Section 1. Short title. This Act may be cited as the Improving Access to Flood Insurance Act.

Section 5. Definitions. As used in this Act:

"Broker" has the meaning given to that term in the Real Estate License Act of 2000.

"Lender" means a bank, a savings bank, or a credit union chartered or organized under the laws of the State of Illinois that engages in real estate lending.

"Managing broker" has the meaning given to that term in the Real Estate License Act of 2000.

"National Flood Insurance Program training" means any class or continuing education opportunity where the main topics include:

(1) the National Flood Insurance Program;

(2) elements of the National Flood Insurance Program; or

(3) flood insurance premium reduction strategies, such as floodplain management, flood risk reduction, or flood hazard mitigation.

Section 10. National Flood Insurance Program training requirement. In addition to any other continuing education requirements that may apply for that profession, each insurance producer, public adjuster, managing broker, broker, and employee of a lender shall participate in at least 3 hours of National Flood Insurance Program training. The insurance producer, public adjuster, managing broker, broker, or lender shall submit evidence of satisfaction of the requirements of this Section to the entity that regulates that profession. The Department of Insurance shall provide a list of pre-approved courses available through the Federal Emergency Management Agency's Emergency Management Institute and other educational institutions the Department determines provide information and training equivalent to the Federal Emergency Management Agency's Emergency Management Institute. The Department of Insurance shall also provide instructions for an insurance producer, public adjuster, managing broker, broker, lender, or employee of a lender to apply and secure credit for course work that meets equivalent educational goals but that is not included on the pre-approved list.

Section 15. Violation of the Act. A violation of this Act shall be considered a violation any other law under which the insurance producer, public adjuster, managing broker, broker, or lender is licensed, chartered, or organized.

Section 105. The Illinois Insurance Code is amended by changing Sections 500-35 and 1565 as follows:

(215 ILCS 5/500-35)

(Section scheduled to be repealed on January 1, 2027)

Sec. 500-35. License.

(a) Unless denied a license pursuant to Section 500-70, persons who have met the requirements of Sections 500-25 and 500-30 shall be issued a 2-year insurance producer license. An insurance producer may receive qualification for a license in one or more of the following lines of authority:

(1) Life: insurance coverage on human lives including benefits of endowment and annuities, and may include benefits in the event of death or dismemberment by accident and benefits for disability income.

(2) Variable life and variable annuity products: insurance coverage provided under variable life insurance contracts and variable annuities.

(3) Accident and health or sickness: insurance coverage for sickness, bodily injury, or accidental death and may include benefits for disability income.

(4) Property: insurance coverage for the direct or consequential loss or damage to property of every kind.

(5) Casualty: insurance coverage against legal liability, including that for death, injury, or disability or damage to real or personal property.

(6) Personal lines: property and casualty insurance coverage sold to individuals and families for primarily noncommercial purposes.

(7) Any other line of insurance permitted under State laws or rules.

(b) An insurance producer license shall remain in effect unless revoked or suspended as long as the fee set forth in Section 500-135 is paid and education requirements for resident individual producers are met by the due date.

(1) Before each license renewal, an insurance producer must satisfactorily complete at least 24 hours of course study in accordance with rules prescribed by the Director. Three of the 24 hours of course study must consist of classroom or webinar ethics instruction. The Director may not approve a course of study unless the course provides for classroom, seminar, webinar, or self-study instruction methods. A course given in a combination instruction method of classroom, seminar, webinar, or self-study shall be deemed to be a self-study course unless the classroom, seminar, or webinar certified hours meets or exceeds two-thirds of 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 as classroom or seminar instruction. In addition to any other requirements under this Section, an insurance producer shall comply with the Improving Access to Flood Insurance Act.

(2) An insurance producer license automatically terminates when an insurance producer fails to successfully meet the requirements of item (1) of subsection (b) of this Section. The producer must complete the course in advance of the renewal date to allow the education provider time to report the credit to the Department.

(c) A provider of a pre-licensing or continuing education course required by Section 500-30 and this Section must pay a registration fee and a course certification fee for each course being certified as provided by Section 500-135.

(d) An individual insurance producer who allows his or her license to lapse may, within 12 months after the due date of the renewal fee, be issued a license without the necessity of passing a written examination. However, a penalty in the amount of double the unpaid renewal fee shall be required after the due date.

(e) A licensed insurance producer who is unable to comply with license renewal procedures due to military service may request a waiver of those procedures.

(f) The license must contain the licensee's name, address, and personal identification number, the date of issuance, the lines of authority, the expiration date, and any other information the Director deems necessary.

(g) Licensees must inform the Director by any means acceptable to the Director of a change of address within 30 days after the change.

(h) In order to assist in the performance of the Director's duties, the Director may contract with a non-governmental entity including the National Association of Insurance Commissioners (NAIC), or any affiliates or subsidiaries that the NAIC oversees, to perform any ministerial functions, including collection of fees, related to producer licensing that the Director and the non-governmental entity may deem appropriate.

(Source: P.A. 100-876, eff. 8-14-18.)

(215 ILCS 5/1565)

Sec. 1565. Continuing education.

(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 or webinar 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 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.

(d) In addition to any other requirements under this Section, a public adjuster shall comply with the Improving Access to Flood Insurance Act.

(Source: P.A. 102-135, eff. 7-23-21.)

Section 110. The Real Estate License Act of 2000 is amended by changing Section 5-70 as follows:

(225 ILCS 454/5-70)

(Section scheduled to be repealed on January 1, 2030)

Sec. 5-70. Continuing education requirement; managing broker or broker.

(a) The requirements of this Section apply to all managing brokers and brokers.

(b) Except as otherwise provided in this Section, each person who applies for renewal of his or her license as a managing broker or broker must successfully complete 12 hours of real estate continuing education courses recommended by the Board and approved by the Department during the current term of the license. In addition, those licensees renewing or obtaining a managing broker's license must successfully complete a 12-hour broker management continuing education course approved by the Department during the current term of the license. The broker management continuing education course must be completed in the classroom or through a live, interactive webinar or online distance education format. No license may be renewed except upon the successful completion of the required courses or their equivalent or upon a waiver of those requirements for good cause shown as determined by the Secretary upon the recommendation of the Board. The requirements of this Article are applicable to all managing brokers and brokers except those managing brokers and brokers who, during the renewal period:

(1) serve in the armed services of the United States;

(2) serve as an elected State or federal official;

(3) serve as a full-time employee of the Department; or

(4) are admitted to practice law pursuant to Illinois Supreme Court rule.

(c) (Blank).

(d) A person receiving an initial license during the 90 days before the renewal date shall not be required to complete the continuing education courses provided for in subsection (b) of this Section as a condition of initial license renewal.

(e) The continuing education requirement for brokers and managing brokers shall consist of a single core curriculum and an elective curriculum, to be recommended by the Board and approved by the Department in accordance with this subsection. The core curriculum shall not be further divided into subcategories or divisions of instruction. The core curriculum shall consist of 4 hours during the current term of the license on subjects that may include, but are not limited to, advertising, agency, disclosures, escrow, fair housing, residential leasing agent management, and license law. The amount of time allotted to each of these subjects shall be recommended by the Board and determined by the Department. The Department, upon the recommendation of the Board, shall review the core curriculum every 4 years, at a minimum, and shall revise the curriculum if necessary. However, the core curriculum's total hourly requirement shall only be subject to change by amendment of this subsection, and any change to the core curriculum shall not be effective for a period of 6 months after such change is made by the Department. The Department shall provide notice to all approved education providers of any changes to the core curriculum. When determining whether revisions of the core curriculum's subjects or specific time requirements are necessary, the Board shall consider recent changes in applicable laws, new laws, and areas of the license law and the Department policy that the Board deems appropriate, and any other subject areas the Board deems timely and applicable in order to prevent violations of this Act and to protect the public. In establishing a recommendation to the Department regarding the elective curriculum, the Board shall consider subjects that cover the various aspects of the practice of real estate that are covered under the scope of this Act.

(f) The subject areas of continuing education courses recommended by the Board and approved by the Department shall be meant to protect the professionalism of the industry, the consumer, and the public and prevent violations of this Act and may include without limitation the following:

(1) license law and escrow;

(2) antitrust;

(3) fair housing;

(4) agency;

(5) appraisal;

(6) property management;

(7) residential brokerage;

(8) farm property management;

(9) transaction management rights and duties of parties in a transaction;

(10) commercial brokerage and leasing;

(11) real estate financing;

(12) disclosures;

(13) residential leasing agent management;

(14) advertising;

(15) broker supervision and managing broker responsibility;

(16) professional conduct; and

(17) use of technology.

(g) In lieu of credit for those courses listed in subsection (f) of this Section, credit may be earned for serving as a licensed instructor in an approved course of continuing education. The amount of credit earned for teaching a course shall be the amount of continuing education credit for which the course is approved for licensees taking the course.

(h) Credit hours may be earned for self-study programs approved by the Department.

(i) A managing broker or broker may earn credit for a specific continuing education course only once during the current term of the license.

(j) No more than 12 hours of continuing education credit may be taken in one calendar day.

(k) To promote the offering of a uniform and consistent course content, the Department may provide for the development of a single broker management course to be offered by all education providers who choose to offer the broker management continuing education course. The Department may contract for the development of the 12-hour broker management continuing education course with an outside vendor or consultant and, if the course is developed in this manner, the Department or the outside consultant shall license the use of that course to all approved education providers who wish to provide the course.

(l) Except as specifically provided in this Act, continuing education credit hours may not be earned for completion of pre-license or post-license courses. The courses comprising the approved 45-hour post-license curriculum for broker licensees shall satisfy the continuing education requirement for the period in which the courses are taken. The approved 45-hour brokerage administration and management course shall satisfy the 12-hour broker management continuing education requirement for the license term in which the course is taken.

(m) In addition to any other requirements of this Section, a managing broker or broker shall comply with the Improving Access to Flood Insurance Act.

(Source: P.A. 100-188, eff. 1-1-18; 101-357, eff. 8-9-19.)