Rep. Dan Brady

Filed: 3/29/2017

 

 


 

 


 
10000HB1954ham001LRB100 04579 SMS 24125 a

1
AMENDMENT TO HOUSE BILL 1954

2    AMENDMENT NO. ______. Amend House Bill 1954 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Insurance Code is amended by
5changing Sections 143.14 and 143.17 as follows:
 
6    (215 ILCS 5/143.14)  (from Ch. 73, par. 755.14)
7    Sec. 143.14. Notice of cancellation.
8    (a) No notice of cancellation of any policy of insurance,
9to which Section 143.11 applies, shall be effective unless
10mailed by the company to the named insured and the mortgage or
11lien holder, at the last mailing address known by the company.
12The company shall maintain proof of mailing of such notice on a
13recognized U.S. Post Office form or a form acceptable to the U.
14S. Post Office or other commercial mail delivery service.
15Notification of the cancellation A copy of all such notices
16shall also be sent to the insured's broker if known, or the

 

 

10000HB1954ham001- 2 -LRB100 04579 SMS 24125 a

1agent of record, if known, and to the mortgagee or lien holder
2listed on the policy at the last mailing address known to the
3company. For purposes of this Section, the mortgage or lien
4holder, insured's broker, if known, or the agent of record may
5opt to accept notification electronically.
6    (b) Whenever a financed insurance contract is cancelled,
7the insurer shall return whatever gross unearned premiums are
8due under the insurance contract or contracts not to exceed the
9unpaid balance due the premium finance company directly to the
10premium finance company effecting the cancellation for the
11account of the named insured. The return premium must be mailed
12to the premium finance company within 60 days. The request for
13the unearned premium by the premium finance company shall be in
14the manner of a monthly account, current accounting by
15producer, policy number, unpaid balance and name of insured for
16each cancelled amount. In the event the insurance contract or
17contracts are subject to audit, the insurer shall retain the
18right to withhold the return of the portion of premium that can
19be identified to the contract or contracts until the audit is
20completed. Within 30 days of the completion of the audit, if a
21premium retained by the insurer after crediting the earned
22premium would result in a surplus, the insurer shall return the
23surplus directly to the premium finance company. If the audit
24should result in an additional premium due the insurer, the
25obligation for the collection of this premium shall fall upon
26the insurer and not affect any other contract or contracts

 

 

10000HB1954ham001- 3 -LRB100 04579 SMS 24125 a

1currently being financed by the premium finance company for the
2named insured.
3    (c) Whenever a premium finance agreement contains a power
4of attorney enabling the premium finance company to cancel any
5insurance contract or contracts in the agreement, the insurer
6shall honor the date of cancellation as set forth in the
7request from the premium finance company without requiring the
8return of the insurance contract or contracts. The insurer may
9mail to the named insured an acknowledgment of the notice of
10cancellation from the premium finance company but the named
11insured shall not incur any additional premium charge for any
12extension of coverage. The insurer need not maintain proof of
13mailing of this notice.
14    (d) All statutory regulatory and contractual restrictions
15providing that the insurance contract may not be cancelled
16unless the required notice is mailed to a governmental agency,
17mortgagee, lienholder, or other third party shall apply where
18cancellation is effected under a power of attorney under a
19premium finance agreement. The insurer shall have the right for
20a premium charge for this extension of coverage.
21(Source: P.A. 93-713, eff. 1-1-05.)
 
22    (215 ILCS 5/143.17)  (from Ch. 73, par. 755.17)
23    Sec. 143.17. Notice of intention not to renew.
24    a. No company shall fail to renew any policy of insurance,
25as defined in subsections (a), (b), (c), and (h) of Section

 

 

10000HB1954ham001- 4 -LRB100 04579 SMS 24125 a

1143.13, to which Section 143.11 applies, unless it shall send
2by mail to the named insured at least 30 days advance notice of
3its intention not to renew. The company shall maintain proof of
4mailing of such notice on a recognized U.S. Post Office form or
5a form acceptable to the U. S. Post Office or other commercial
6mail delivery service. Notification of the intention not to
7renew An exact and unaltered copy of such notice shall also be
8sent to the insured's broker, if known, or the agent of record
9and to any the mortgagee or lien holder listed on the policy at
10the last mailing address known by the company. For purposes of
11this Section, the mortgagee or lien holder, insured's broker,
12or the agent of record may opt to accept notification
13electronically. However, where cancellation is for nonpayment
14of premium, the notice of cancellation must be mailed at least
1510 days before the effective date of the cancellation.
16    b. This Section does not apply if the company has
17manifested its willingness to renew directly to the named
18insured. Such written notice shall specify the premium amount
19payable, including any premium payment plan available, and the
20name of any person or persons, if any, authorized to receive
21payment on behalf of the company. If no person is so
22authorized, the premium notice shall so state. The notice of
23nonrenewal and the proof of mailing shall be effected on the
24same date.
25    b-5. This Section does not apply if the company manifested
26its willingness to renew directly to the named insured.

 

 

10000HB1954ham001- 5 -LRB100 04579 SMS 24125 a

1However, no company may impose changes in deductibles or
2coverage for any policy forms applicable to an entire line of
3business enumerated in subsections (a), (b), (c), and (h) of
4Section 143.13 to which Section 143.11 applies unless the
5company mails to the named insured written notice of the change
6in deductible or coverage at least 60 days prior to the renewal
7or anniversary date. An exact and unaltered copy of the notice
8shall also be sent to the insured's broker, if known, or the
9agent of record.
10    c. Should a company fail to comply with (a) or (b) of this
11Section, the policy shall terminate only on the effective date
12of any similar insurance procured by the insured with respect
13to the same subject or location designated in both policies.
14    d. Renewal of a policy does not constitute a waiver or
15estoppel with respect to grounds for cancellation which existed
16before the effective date of such renewal.
17    e. In all notices of intention not to renew any policy of
18insurance, as defined in Section 143.11 the company shall
19provide a specific explanation of the reasons for nonrenewal.
20    f. For purposes of this Section, the insured's broker, if
21known, or the agent of record and the mortgagee or lien holder
22may opt to accept notification electronically.
23(Source: P.A. 93-713, eff. 1-1-05.)
 
24    Section 99. Effective date. This Act takes effect January
251, 2018.".