Illinois General Assembly - Full Text of HB1552
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Full Text of HB1552  98th General Assembly




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1    AN ACT concerning insurance.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 5. The Illinois Insurance Code is amended by
5changing Sections 143, 356z.12, and 1202 as follows:
6    (215 ILCS 5/143)  (from Ch. 73, par. 755)
7    Sec. 143. Policy forms.
8    (1) Life, accident and health. No company transacting the
9kind or kinds of business enumerated in Classes 1 (a), 1 (b)
10and 2 (a) of Section 4 shall issue or deliver in this State a
11policy or certificate of insurance or evidence of coverage,
12attach an endorsement or rider thereto, incorporate by
13reference bylaws or other matter therein or use an application
14blank in this State until the form and content of such policy,
15certificate, evidence of coverage, endorsement, rider, bylaw
16or other matter incorporated by reference or application blank
17has been filed electronically with the Director, either through
18the System for Electronic Rate and Form Filing (SERFF) or as
19otherwise prescribed by the Director, and approved by the
20Director. The Department shall mail a quarterly invoice to the
21company for the appropriate filing fees required under Section
22408. Any such endorsement or rider that unilaterally reduces
23benefits and is to be attached to a policy subsequent to the



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1date the policy is issued must be filed with, reviewed, and
2formally approved by the Director prior to the date it is
3attached to a policy issued or delivered in this State. It
4shall be the duty of the Director to withhold approval of any
5such policy, certificate, endorsement, rider, bylaw or other
6matter incorporated by reference or application blank filed
7with him if it contains provisions which encourage
8misrepresentation or are unjust, unfair, inequitable,
9ambiguous, misleading, inconsistent, deceptive, contrary to
10law or to the public policy of this State, or contains
11exceptions and conditions that unreasonably or deceptively
12affect the risk purported to be assumed in the general coverage
13of the policy. In all cases the Director shall approve or
14disapprove any such form within 60 days after submission unless
15the Director extends by not more than an additional 30 days the
16period within which he shall approve or disapprove any such
17form by giving written notice to the insurer of such extension
18before expiration of the initial 60 days period. The Director
19shall withdraw his approval of a policy, certificate, evidence
20of coverage, endorsement, rider, bylaw, or other matter
21incorporated by reference or application blank if he
22subsequently determines that such policy, certificate,
23evidence of coverage, endorsement, rider, bylaw, other matter,
24or application blank is misrepresentative, unjust, unfair,
25inequitable, ambiguous, misleading, inconsistent, deceptive,
26contrary to law or public policy of this State, or contains



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1exceptions or conditions which unreasonably or deceptively
2affect the risk purported to be assumed in the general coverage
3of the policy or evidence of coverage.
4    If a previously approved policy, certificate, evidence of
5coverage, endorsement, rider, bylaw or other matter
6incorporated by reference or application blank is withdrawn for
7use, the Director shall serve upon the company an order of
8withdrawal of use, either personally or by mail, and if by
9mail, such service shall be completed if such notice be
10deposited in the post office, postage prepaid, addressed to the
11company's last known address specified in the records of the
12Department of Insurance. The order of withdrawal of use shall
13take effect 30 days from the date of mailing but shall be
14stayed if within the 30-day period a written request for
15hearing is filed with the Director. Such hearing shall be held
16at such time and place as designated in the order given by the
17Director. The hearing may be held either in the City of
18Springfield, the City of Chicago or in the county where the
19principal business address of the company is located. The
20action of the Director in disapproving or withdrawing such form
21shall be subject to judicial review under the Administrative
22Review Law.
23    This subsection shall not apply to riders or endorsements
24issued or made at the request of the individual policyholder
25relating to the manner of distribution of benefits or to the
26reservation of rights and benefits under his life insurance



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2    (2) Casualty, fire, and marine. The Director shall require
3the filing of all policy forms issued or delivered by any
4company transacting the kind or kinds of business enumerated in
5Classes 2 (except Class 2 (a)) and 3 of Section 4 in an
6electronic format either through the System for Electronic Rate
7and Form Filing (SERFF) or as otherwise prescribed and approved
8by the Director. In addition, he may require the filing of any
9generally used riders, endorsements, certificates, application
10blanks, and other matter incorporated by reference in any such
11policy or contract of insurance. The Department shall mail a
12quarterly invoice to the company for the appropriate filing
13fees required under Section 408. Companies that are members of
14an organization, bureau, or association may have the same filed
15for them by the organization, bureau, or association. If the
16Director shall find from an examination of any such policy
17form, rider, endorsement, certificate, application blank, or
18other matter incorporated by reference in any such policy so
19filed that it (i) violates any provision of this Code, (ii)
20contains inconsistent, ambiguous, or misleading clauses, or
21(iii) contains exceptions and conditions that will
22unreasonably or deceptively affect the risks that are purported
23to be assumed by the policy, he shall order the company or
24companies issuing these forms to discontinue their use. Nothing
25in this subsection shall require a company transacting the kind
26or kinds of business enumerated in Classes 2 (except Class 2



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1(a)) and 3 of Section 4 to obtain approval of these forms
2before they are issued nor in any way affect the legality of
3any policy that has been issued and found to be in conflict
4with this subsection, but such policies shall be subject to the
5provisions of Section 442.
6    (3) This Section shall not apply (i) to surety contracts or
7fidelity bonds, (ii) to policies issued to an industrial
8insured as defined in Section 121-2.08 except for workers'
9compensation policies, nor (iii) to riders or endorsements
10prepared to meet special, unusual, peculiar, or extraordinary
11conditions applying to an individual risk.
12(Source: P.A. 97-486, eff. 1-1-12.)
13    (215 ILCS 5/356z.12)
14    Sec. 356z.12. Dependent coverage.
15    (a) A group or individual policy of accident and health
16insurance or managed care plan that provides coverage for
17dependents and that is amended, delivered, issued, or renewed
18after the effective date of this amendatory Act of the 95th
19General Assembly shall not terminate coverage or deny the
20election of coverage for an unmarried dependent by reason of
21the dependent's age before the dependent's 26th birthday.
22    (b) A policy or plan subject to this Section shall, upon
23amendment, delivery, issuance, or renewal, establish an
24initial enrollment period of not less than 90 days during which
25an insured may make a written election for coverage of an



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1unmarried person as a dependent under this Section. After the
2initial enrollment period, enrollment by a dependent pursuant
3to this Section shall be consistent with the enrollment terms
4of the plan or policy.
5    (c) A policy or plan subject to this Section shall allow
6for dependent coverage during the annual open enrollment date
7or the annual renewal date if the dependent, as of the date on
8which the insured elects dependent coverage under this
9subsection, has:
10        (1) a period of continuous creditable coverage of 90
11    days or more; and
12        (2) not been without creditable coverage for more than
13    63 days.
14An insured may elect coverage for a dependent who does not meet
15the continuous creditable coverage requirements of this
16subsection (c) and that dependent shall not be denied coverage
17due to age.
18    For purposes of this subsection (c), "creditable coverage"
19shall have the meaning provided under subsection (C)(1) of
20Section 20 of the Illinois Health Insurance Portability and
21Accountability Act.
22    (d) Military personnel. A group or individual policy of
23accident and health insurance or managed care plan that
24provides coverage for dependents and that is amended,
25delivered, issued, or renewed after the effective date of this
26amendatory Act of the 95th General Assembly shall not terminate



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1coverage or deny the election of coverage for an unmarried
2dependent by reason of the dependent's age before the
3dependent's 30th birthday if the dependent (i) is an Illinois
4resident, (ii) served as a member of the active or reserve
5components of any of the branches of the Armed Forces of the
6United States, and (iii) has received a release or discharge
7other than a dishonorable discharge. To be eligible for
8coverage under this subsection (d), the eligible dependent
9shall submit to the insurer a form approved by the Illinois
10Department of Veterans' Affairs stating the date on which the
11dependent was released from service.
12    (e) Calculation of the cost of coverage provided to an
13unmarried dependent under this Section shall be identical.
14    (f) Nothing in this Section shall prohibit an employer from
15requiring an employee to pay all or part of the cost of
16coverage provided under this Section.
17    (g) No exclusions or limitations may be applied to coverage
18elected pursuant to this Section that do not apply to all
19dependents covered under the policy.
20    (h) A policy or plan subject to this Section shall not
21condition eligibility for dependent coverage provided pursuant
22to this Section on enrollment in any educational institution.
23    (i) Notice regarding coverage for a dependent as provided
24pursuant to this Section shall be provided to an insured by the
26        (1) upon application or enrollment;



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1        (2) in the certificate of coverage or equivalent
2    document prepared for an insured and delivered on or about
3    the date on which the coverage commences; and
4        (3) (blank) in a notice delivered to an insured on a
5    semi-annual basis.
6(Source: P.A. 95-958, eff. 6-1-09.)
7    (215 ILCS 5/1202)  (from Ch. 73, par. 1065.902)
8    Sec. 1202. Duties. The Director shall:
9    (a) determine the relationship of insurance premiums and
10related income as compared to insurance costs and expenses and
11provide such information to the General Assembly and the
12general public;
13    (b) study the insurance system in the State of Illinois,
14and recommend to the General Assembly what it deems to be the
15most appropriate and comprehensive cost containment system for
16the State;
17    (c) respond to the requests by agencies of government and
18the General Assembly for special studies and analysis of data
19collected pursuant to this Article. Such reports shall be made
20available in a form prescribed by the Director. The Director
21may also determine a fee to be charged to the requesting agency
22to cover the direct and indirect costs for producing such a
23report, and shall permit affected insurers the right to review
24the accuracy of the report before it is released. The fees
25shall be deposited into the Statistical Services Revolving Fund



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1and credited to the account of the Department of Insurance;
2    (d) make an interim report to the General Assembly no later
3than August 15, 1987, and a annual report to the General
4Assembly no later than July 1 April 15 every year thereafter
5which shall include the Director's findings and
6recommendations regarding its duties as provided under
7subsections (a), (b), and (c) of this Section.
8(Source: P.A. 91-357, eff. 7-29-99.)