Full Text of SB1411 98th General Assembly
SB1411sam001 98TH GENERAL ASSEMBLY | Sen. William R. Haine Filed: 4/9/2013
| | 09800SB1411sam001 | | LRB098 02750 RPM 44106 a |
|
| 1 | | AMENDMENT TO SENATE BILL 1411
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 1411 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | changing Sections 1510, 1570, and 1575 as follows: | 6 | | (215 ILCS 5/1510)
| 7 | | Sec. 1510. Definitions. In this Article: | 8 | | "Adjusting a claim for loss or damage covered by an | 9 | | insurance contract" means negotiating values, damages, or | 10 | | depreciation or applying the loss circumstances to insurance | 11 | | policy provisions. | 12 | | "Business entity" means a corporation, association, | 13 | | partnership, limited liability company, limited liability | 14 | | partnership, or other legal entity. | 15 | | "Department" means the Department of Insurance. | 16 | | "Director" means the Director of Insurance. |
| | | 09800SB1411sam001 | - 2 - | LRB098 02750 RPM 44106 a |
|
| 1 | | "Catastrophic event" means an event for which the Governor | 2 | | of this State has declared a state of emergency. | 3 | | "Fingerprints" means an impression of the lines on the | 4 | | finger taken for the purpose of identification. The impression | 5 | | may be electronic or in ink converted to electronic format. | 6 | | "Home state" means the District of Columbia and any state | 7 | | or territory of the United States where the public adjuster's | 8 | | principal place of residence or principal place of business is | 9 | | located. If neither the state in which the public adjuster | 10 | | maintains the principal place of residence nor the state in | 11 | | which the public adjuster maintains the principal place of | 12 | | business has a substantially similar law governing public | 13 | | adjusters, the public adjuster may declare another state in | 14 | | which it becomes licensed and acts as a public adjuster to be | 15 | | the home state. | 16 | | "Individual" means a natural person. | 17 | | "Person" means an individual or a business entity. | 18 | | "Public adjuster" means any person who, for compensation or | 19 | | any other thing of value on behalf of the insured: | 20 | | (i) acts or aids, solely in relation to first party | 21 | | claims arising under insurance contracts that insure the | 22 | | real or personal property of the insured, on behalf of an | 23 | | insured in adjusting a claim for loss or damage covered by | 24 | | an insurance contract; | 25 | | (ii) advertises for employment as a public adjuster of | 26 | | insurance claims or solicits business or represents |
| | | 09800SB1411sam001 | - 3 - | LRB098 02750 RPM 44106 a |
|
| 1 | | himself or herself to the public as a public adjuster of | 2 | | first party insurance claims for losses or damages arising | 3 | | out of policies of insurance that insure real or personal | 4 | | property; or | 5 | | (iii) directly or indirectly solicits business, | 6 | | investigates or adjusts losses, or advises an insured about | 7 | | first party claims for losses or damages arising out of | 8 | | policies of insurance that insure real or personal property | 9 | | for another person engaged in the business of adjusting | 10 | | losses or damages covered by an insurance policy for the | 11 | | insured. | 12 | | "Uniform individual application" means the current version | 13 | | of the National Association of Directors (NAIC) Uniform | 14 | | Individual Application for resident and nonresident | 15 | | individuals. | 16 | | "Uniform business entity application" means the current | 17 | | version of the National Association of Insurance Commissioners | 18 | | (NAIC) Uniform Business Entity Application for resident and | 19 | | nonresident business entities.
| 20 | | (Source: P.A. 96-1332, eff. 1-1-11.) | 21 | | (215 ILCS 5/1570)
| 22 | | Sec. 1570. Public adjuster fees. | 23 | | (a) A public adjuster shall not pay a commission, service | 24 | | fee, or other valuable consideration to a person for | 25 | | investigating or settling claims in this State if that person |
| | | 09800SB1411sam001 | - 4 - | LRB098 02750 RPM 44106 a |
|
| 1 | | is required to be licensed under this Article and is not so | 2 | | licensed. | 3 | | (b) A person shall not accept a commission, service fee, or | 4 | | other valuable consideration for investigating or settling | 5 | | claims in this State if that person is required to be licensed | 6 | | under this Article and is not so licensed. | 7 | | (c) A public adjuster may pay or assign commission, service | 8 | | fees, or other valuable consideration to persons who do not | 9 | | investigate or settle claims in this State, unless the payment | 10 | | would violate State law.
| 11 | | (d) A public adjuster may not charge, agree to, or accept | 12 | | any compensation, payment, commission, fee, or other valuable | 13 | | consideration in excess of 10% of the amount of the insurance | 14 | | settlement claim paid by the insurer on any claim involving | 15 | | personal lines coverage as defined by subsection (b) of Section | 16 | | 143.13 of this Code or any claim resulting from a catastrophic | 17 | | event. | 18 | | (Source: P.A. 96-1332, eff. 1-1-11.) | 19 | | (215 ILCS 5/1575)
| 20 | | Sec. 1575. Contract between public adjuster and insured. | 21 | | (a) Public adjusters shall ensure that all contracts for | 22 | | their services are in writing and contain the following terms: | 23 | | (1) legible full name of the adjuster signing the | 24 | | contract, as specified in Department records; | 25 | | (2) permanent home state business address and phone |
| | | 09800SB1411sam001 | - 5 - | LRB098 02750 RPM 44106 a |
|
| 1 | | number; | 2 | | (3) license number; | 3 | | (4) title of "Public Adjuster Contract"; | 4 | | (5) the insured's full name, street address, insurance | 5 | | company name, and policy number, if known or upon | 6 | | notification; | 7 | | (6) a description of the loss and its location, if | 8 | | applicable; | 9 | | (7) description of services to be provided to the | 10 | | insured; | 11 | | (8) signatures of the public adjuster and the insured; | 12 | | (9) date and time the contract was signed by the public | 13 | | adjuster and date and time the contract was signed by the | 14 | | insured; | 15 | | (10) attestation language stating that the public | 16 | | adjuster is fully bonded pursuant to State law; and | 17 | | (11) full salary, fee, commission, compensation, or | 18 | | other considerations the public adjuster is to receive for | 19 | | services. | 20 | | (b) The contract may specify that the public adjuster shall | 21 | | be named as a co-payee on an insurer's payment of a claim. | 22 | | (1) If the compensation is based on a share of the | 23 | | insurance settlement, the exact percentage shall be | 24 | | specified. | 25 | | (2) Initial expenses to be reimbursed to the public | 26 | | adjuster from the proceeds of the claim payment shall be |
| | | 09800SB1411sam001 | - 6 - | LRB098 02750 RPM 44106 a |
|
| 1 | | specified by type, with dollar estimates set forth in the | 2 | | contract and with any additional expenses first approved by | 3 | | the insured. | 4 | | (3) Compensation provisions in a public adjuster | 5 | | contract shall not be redacted in any copy of the contract | 6 | | provided to the Director. | 7 | | (c) If the insurer, not later than 5 business days after | 8 | | the date on which the loss is reported to the insurer, either | 9 | | pays or commits in writing to pay to the insured the policy | 10 | | limit of the insurance policy, the public adjuster shall: | 11 | | (1) not receive a commission consisting of a percentage | 12 | | of the total amount paid by an insurer to resolve a claim; | 13 | | (2) inform the insured that loss recovery amount might | 14 | | not be increased by insurer; and | 15 | | (3) be entitled only to reasonable compensation from | 16 | | the insured for services provided by the public adjuster on | 17 | | behalf of the insured, based on the time spent on a claim | 18 | | and expenses incurred by the public adjuster, until the | 19 | | claim is paid or the insured receives a written commitment | 20 | | to pay from the insurer. | 21 | | (d) A public adjuster shall provide the insured a written | 22 | | disclosure concerning any direct or indirect financial | 23 | | interest that the public adjuster has with any other party who | 24 | | is involved in any aspect of the claim, other than the salary, | 25 | | fee, commission, or other consideration established in the | 26 | | written contract with the insured, including, but not limited |
| | | 09800SB1411sam001 | - 7 - | LRB098 02750 RPM 44106 a |
|
| 1 | | to, any ownership of or any compensation expected to be | 2 | | received from, any construction firm, salvage firm, building | 3 | | appraisal firm, board-up company, or any other firm that | 4 | | provides estimates for work, or that performs any work, in | 5 | | conjunction with damages caused by the insured loss on which | 6 | | the public adjuster is engaged. The word "firm" shall include | 7 | | any corporation, partnership, association, joint-stock | 8 | | company, or person. | 9 | | (e) A public adjuster contract may not contain any contract | 10 | | term that: | 11 | | (1) allows the public adjuster's percentage fee to be | 12 | | collected when money is due from an insurance company, but | 13 | | not paid, or that allows a public adjuster to collect the | 14 | | entire fee from the first check issued by an insurance | 15 | | company, rather than as a percentage of each check issued | 16 | | by an insurance company; | 17 | | (2) requires the insured to authorize an insurance | 18 | | company to issue a check only in the name of the public | 19 | | adjuster; | 20 | | (3) precludes a public adjuster or an insured from | 21 | | pursuing civil remedies; | 22 | | (4) includes any hold harmless agreement that provides | 23 | | indemnification to the public adjuster by the insured for | 24 | | liability resulting from the public adjuster's negligence; | 25 | | or | 26 | | (5) provides power of attorney by which the public |
| | | 09800SB1411sam001 | - 8 - | LRB098 02750 RPM 44106 a |
|
| 1 | | adjuster can act in the place and instead of the insured. | 2 | | (f) The following provisions apply to a contract between a | 3 | | public adjuster and an insured: | 4 | | (1) Prior to the signing of the contract, the public | 5 | | adjuster shall provide the insured with a separate signed | 6 | | and dated disclosure document regarding the claim process | 7 | | that states: | 8 | | "Property insurance policies obligate the insured to | 9 | | present a claim to his or her insurance company for | 10 | | consideration. There are 3 types of adjusters that could be | 11 | | involved in that process. The definitions of the 3 types | 12 | | are as follows: | 13 | | (A) "Company adjuster" means the insurance | 14 | | adjusters who are employees of an insurance company. | 15 | | They represent the interest of the insurance company | 16 | | and are paid by the insurance company. They will not | 17 | | charge you a fee. | 18 | | (B) "Independent adjuster" means the insurance | 19 | | adjusters who are hired on a contract basis by an | 20 | | insurance company to represent the insurance company's | 21 | | interest in the settlement of the claim. They are paid | 22 | | by your insurance company. They will not charge you a | 23 | | fee. | 24 | | (C) "Public adjuster" means the insurance | 25 | | adjusters who do not work for any insurance company. | 26 | | They work for the insured to assist in the preparation, |
| | | 09800SB1411sam001 | - 9 - | LRB098 02750 RPM 44106 a |
|
| 1 | | presentation and settlement of the claim. The insured | 2 | | hires them by signing a contract agreeing to pay them a | 3 | | fee or commission based on a percentage of the | 4 | | settlement, or other method of compensation.". | 5 | | (2) The insured is not required to hire a public | 6 | | adjuster to help the insured meet his or her obligations | 7 | | under the policy, but has the right to do so. | 8 | | (3) The public adjuster is not a representative or | 9 | | employee of the insurer. | 10 | | (4) The salary, fee, commission, or other | 11 | | consideration is the obligation of the insured, not the | 12 | | insurer, except when rights have been assigned to the | 13 | | public adjuster by the insured. | 14 | | (g) The contracts shall be executed in duplicate to provide | 15 | | an original contract to the public adjuster, and an original | 16 | | contract to the insured. The public adjuster's original | 17 | | contract shall be available at all times for inspection without | 18 | | notice by the Director. | 19 | | (h) The public adjuster shall provide the insurer with an | 20 | | exact copy of the contract by the insured, authorizing the | 21 | | public adjuster to represent the insured's interest. | 22 | | (i) The public adjuster shall give the insured written | 23 | | notice of the insured's rights as a consumer under the law of | 24 | | this State. | 25 | | (j) A public adjuster shall not provide services until a | 26 | | written contract with the insured has been executed, on a form |
| | | 09800SB1411sam001 | - 10 - | LRB098 02750 RPM 44106 a |
|
| 1 | | filed with and approved by the Director. At the option of the | 2 | | insured, any such contract shall be voidable for 10 5 business | 3 | | days after execution. The insured may void the contract by | 4 | | notifying the public adjuster in writing by (i) registered or | 5 | | certified mail, return receipt requested, to the address shown | 6 | | on the contract or (ii) personally serving the notice on the | 7 | | public adjuster. The contract must indicate the rescission | 8 | | period in clearly visible, bold type and in not less than | 9 | | 10-point font. | 10 | | (k) If the insured exercises the right to rescind the | 11 | | contract, anything of value given by the insured under the | 12 | | contract will be returned to the insured within 15 business | 13 | | days following the receipt by the public adjuster of the | 14 | | cancellation notice.
| 15 | | (Source: P.A. 96-1332, eff. 1-1-11; 97-333, eff. 8-12-11.)".
|
|