|
||||||||||||||||||||
|
||||||||||||||||||||
| ||||||||||||||||||||
|
||||||||||||||||||||
| ||||||||||||||||||||
1 | AN ACT concerning insurance.
| |||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| |||||||||||||||||||
3 | represented in the General Assembly:
| |||||||||||||||||||
4 | Section 5. The Illinois Insurance Code is amended by | |||||||||||||||||||
5 | changing Section 155.18 as follows:
| |||||||||||||||||||
6 | (215 ILCS 5/155.18) (from Ch. 73, par. 767.18)
| |||||||||||||||||||
7 | Sec. 155.18. (a) This Section applies
shall apply to | |||||||||||||||||||
8 | insurance on risks based
upon negligence by a physician, | |||||||||||||||||||
9 | hospital or other health care provider,
referred to herein as | |||||||||||||||||||
10 | medical liability insurance. This Section shall not
apply to | |||||||||||||||||||
11 | contracts of reinsurance, nor to any farm, county, district or
| |||||||||||||||||||
12 | township mutual insurance company transacting business under | |||||||||||||||||||
13 | an Act entitled
"An Act relating to local mutual district, | |||||||||||||||||||
14 | county and township insurance
companies", approved March 13, | |||||||||||||||||||
15 | 1936, as now or hereafter amended, nor to
any such company | |||||||||||||||||||
16 | operating under a special charter.
| |||||||||||||||||||
17 | (b) The following standards shall apply to the making and | |||||||||||||||||||
18 | use of rates
pertaining to all classes of medical liability | |||||||||||||||||||
19 | insurance:
| |||||||||||||||||||
20 | (1) Rates shall not be excessive or inadequate, as herein | |||||||||||||||||||
21 | defined, nor
shall they be unfairly discriminatory. No rate | |||||||||||||||||||
22 | shall be held to be excessive
unless such rate is unreasonably | |||||||||||||||||||
23 | high for the insurance provided, and a
reasonable degree of | |||||||||||||||||||
24 | competition does not exist in the area with respect
to the | |||||||||||||||||||
25 | classification to which such rate is applicable.
| |||||||||||||||||||
26 | No rate shall be held inadequate unless it is unreasonably | |||||||||||||||||||
27 | low for the
insurance provided and continued use of it would | |||||||||||||||||||
28 | endanger solvency of the company.
| |||||||||||||||||||
29 | (2) Consideration shall be given, to the extent applicable, | |||||||||||||||||||
30 | to past and
prospective loss experience within and outside this | |||||||||||||||||||
31 | State, to a reasonable
margin for underwriting profit and | |||||||||||||||||||
32 | contingencies, to past and prospective
expenses both |
| |||||||
|
|||||||
1 | countrywide and those especially applicable to this State,
and | ||||||
2 | to all other factors, including judgment factors, deemed | ||||||
3 | relevant within
and outside this State.
| ||||||
4 | Consideration may also be given in the making and use of | ||||||
5 | rates to dividends,
savings or unabsorbed premium deposits | ||||||
6 | allowed or returned by companies
to their policyholders, | ||||||
7 | members or subscribers.
| ||||||
8 | (3) The systems of expense provisions included in the rates | ||||||
9 | for use by
any company or group of companies may differ from | ||||||
10 | those of other companies
or groups of companies to reflect the | ||||||
11 | operating methods of any such company
or group with respect to | ||||||
12 | any kind of insurance, or with respect to any subdivision
or | ||||||
13 | combination thereof.
| ||||||
14 | (4) Risks may be grouped by classifications for the | ||||||
15 | establishment of rates
and minimum premiums. Classification | ||||||
16 | rates may be modified to produce
rates for individual risks in | ||||||
17 | accordance with rating plans which establish
standards for | ||||||
18 | measuring variations in hazards or expense provisions, or
both. | ||||||
19 | Such standards may measure any difference among risks that have | ||||||
20 | a
probable effect upon losses or expenses. Such classifications | ||||||
21 | or modifications
of classifications of risks may be established | ||||||
22 | based upon size, expense,
management, individual experience, | ||||||
23 | location or dispersion of hazard, or
any other reasonable | ||||||
24 | considerations and shall apply to all risks under the
same or | ||||||
25 | substantially the same circumstances or conditions. The rate | ||||||
26 | for
an established classification should be related generally | ||||||
27 | to the anticipated
loss and expense factors of the class.
| ||||||
28 | (c) Every company writing medical liability insurance | ||||||
29 | shall file with
the Director of Insurance the rates and rating | ||||||
30 | schedules it uses for medical
liability insurance.
| ||||||
31 | (1) This filing shall occur at least annually and as often | ||||||
32 | as the rates
are changed or amended.
| ||||||
33 | (2) For the purposes of this Section any change in premium | ||||||
34 | to the company's
insureds as a result of a change in the | ||||||
35 | company's base rates or a change
in its increased limits | ||||||
36 | factors shall constitute a change in rates and shall
require a |
| |||||||
|
|||||||
1 | filing with the Director.
| ||||||
2 | (3) It shall be certified in such filing by an officer of | ||||||
3 | the company
and a qualified actuary that the company's rates | ||||||
4 | are based on sound actuarial
principles and are not | ||||||
5 | inconsistent with the company's experience.
| ||||||
6 | (d) If after a hearing the Director finds:
| ||||||
7 | (1) that any rate, rating plan or rating system violates | ||||||
8 | the provisions
of this Section applicable to it, he may issue | ||||||
9 | an order to the company which
has been the subject of the | ||||||
10 | hearing specifying in what respects such violation
exists and | ||||||
11 | stating when, within a reasonable period of time, the further
| ||||||
12 | use of such rate or rating system by such company in contracts | ||||||
13 | of insurance
made thereafter shall be prohibited;
| ||||||
14 | (2) that the violation of any of the provisions of this | ||||||
15 | Section applicable
to it by any company which has been the | ||||||
16 | subject of hearing was wilful, he
may suspend or revoke, in | ||||||
17 | whole or in part, the certificate of authority
of such company | ||||||
18 | with respect to the class of insurance which has been the
| ||||||
19 | subject of the hearing.
| ||||||
20 | (Source: P.A. 79-1434.)
|