Full Text of HB4611 103rd General Assembly
HB4611ham004 103RD GENERAL ASSEMBLY | Rep. Thaddeus Jones Filed: 4/17/2024 | | 10300HB4611ham004 | | LRB103 37111 RPS 72522 a |
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| 1 | | AMENDMENT TO HOUSE BILL 4611
| 2 | | AMENDMENT NO. ______. Amend House Bill 4611 by replacing | 3 | | everything after the enacting clause with the following: | 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | changing Section 424 and by adding Sections 143.19.4, | 6 | | 143.19.5, and 143.19.6 as follows: | 7 | | (215 ILCS 5/143.19.4 new) | 8 | | Sec. 143.19.4. Standards applicable to certain vehicle | 9 | | insurance rates. | 10 | | (a) This Section applies to insurance on risks in this | 11 | | State described in clause (b) of Class 2 and clause (e) of | 12 | | Class 3 of Section 4 of this Code. | 13 | | (b) The following standards shall apply to the making and | 14 | | use of rates pertaining to the classes of insurance to which | 15 | | this Section applies: | 16 | | (1) Rates shall not be excessive, inadequate, or |
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| 1 | | unfairly discriminatory. | 2 | | (2) An insurer shall use methods based on sound | 3 | | actuarial principles. | 4 | | (3) A rate is excessive if it is likely to produce a | 5 | | profit that is unreasonably high for the insurance | 6 | | provided. | 7 | | (4) A rate is not inadequate unless the rate is | 8 | | insufficient to sustain projected losses and expenses in | 9 | | the class of insurance to which it applies or the use of | 10 | | such rate has or, if continued, will endanger the solvency | 11 | | of the insurer using it, or have the effect of | 12 | | substantially lessening competition or the tendency to | 13 | | create a monopoly in any market. | 14 | | (5) Unfair discrimination in insurance rates is | 15 | | prohibited. Unfair discrimination exists if, after | 16 | | allowing for practical limitations, price differentials | 17 | | fail to reflect equitably the differences in expected | 18 | | losses and expenses. If unfair discrimination is found, | 19 | | the Department of Insurance may require corrective action | 20 | | from the insurance producer to take effect in the | 21 | | following calendar year. The Department of Insurance may | 22 | | also issue a fine of $5,000 per instance of unfair | 23 | | discrimination. | 24 | | (c) Nothing in this Section shall be construed as a | 25 | | requirement on the Department to review or approve rating | 26 | | information regularly filed with the Department or to limit or |
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| 1 | | define the scope of the Department's authority to review that | 2 | | rating information. Upon request, an insurance company is | 3 | | required to provide the Department any information the | 4 | | Department deems relevant to a company's compliance with this | 5 | | Section. | 6 | | (215 ILCS 5/143.19.5 new) | 7 | | Sec. 143.19.5. The Automobile Insurance Affordability and | 8 | | Availability Task Force. | 9 | | (a) The Automobile Insurance Affordability and | 10 | | Availability Task Force is created to study and report on the | 11 | | Illinois automobile insurance marketplace and regulatory | 12 | | environment and the impacts of current practices and | 13 | | regulations on the overall availability and affordability of | 14 | | automobile insurance. The report shall incorporate data and | 15 | | conclusions from other jurisdictions, but shall focus on | 16 | | providing analyses and recommendations specific to the | 17 | | Illinois marketplace. The Task Force shall, at minimum, | 18 | | consider the following issues and may make recommendations to | 19 | | address any findings based on its consideration of those | 20 | | issues: | 21 | | (1) National trends and data on availability and | 22 | | affordability of automobile insurance in Illinois and | 23 | | other jurisdictions. | 24 | | (2) Rate approval regimes in other jurisdictions, | 25 | | including their relative impact on affordability and |
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| 1 | | availability, time and cost efficiency for regulators and | 2 | | taxpayers, and expected impact on residual markets. | 3 | | (3) Current automobile insurance rating practices in | 4 | | Illinois and the impact a rate review mechanism would have | 5 | | on premiums in that market. | 6 | | (4) Inflationary pressures on insurance affordability, | 7 | | including, but not limited to, the cost of vehicle parts, | 8 | | vehicle repair labor, and medical costs. | 9 | | (5) Driving behavior patterns as well as trends | 10 | | relating to driving under the influence of alcohol, | 11 | | speeding, distracted driving, red light enforcement, and | 12 | | other enforcement, including, but not limited to, the | 13 | | analysis and recommendations identified in the 2024 | 14 | | Roadmap to Safety by Advocates for Highway and Auto | 15 | | Safety. | 16 | | (6) Automobile-related tort and litigation trends, | 17 | | including, but not limited to, the effect of assignments | 18 | | of benefits. | 19 | | (7) The impact prohibiting rate-making based on credit | 20 | | score, gender, or lack of prior insurance would have on | 21 | | automobile insurance premiums in Illinois. | 22 | | (8) The impact that Section 143.19.6 has on the | 23 | | automobile insurance marketplace. | 24 | | The Task Force shall compile a report on its findings and | 25 | | submit that report to the Governor and the General Assembly on | 26 | | or before January 1, 2028. |
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| 1 | | (b) The Task Force, with respect to consumer education, | 2 | | shall review, assess, develop, and make available to consumers | 3 | | educational materials based on Regulatory Resources for | 4 | | Consumers on Personal Lines Pricing and Underwriting and the | 5 | | Consumers Guide to Auto Insurance published by the National | 6 | | Association of Insurance Commissioners. | 7 | | (c) The Task Force shall include the following | 8 | | individuals: | 9 | | (1) The Director of Insurance or the Director's | 10 | | designee. | 11 | | (2) The Secretary of State or the Secretary's | 12 | | designee. | 13 | | (3) The Secretary of Transportation or the Secretary's | 14 | | designee. | 15 | | (4) One member of the Senate, appointed by the | 16 | | President of the Senate. | 17 | | (5) One member of the Senate, appointed by the Senate | 18 | | Minority Leader. | 19 | | (6) One member of the House of Representatives, | 20 | | appointed by the Speaker of the House of Representatives. | 21 | | (7) One member of the House of Representatives, | 22 | | appointed by the Minority Leader of the House of | 23 | | Representatives. | 24 | | (8) One representative from a non-profit consumer | 25 | | organization that serves to protect the interests of | 26 | | Illinois consumers as it relates to the regulation of |
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| 1 | | insurance, appointed by the Governor. | 2 | | (9) One representative from an organization | 3 | | representing the interests of minority or economically | 4 | | disadvantaged populations, appointed by the Governor. | 5 | | (10) One representative from a trade organization | 6 | | representing the insurance industry in Illinois, appointed | 7 | | by the Governor. | 8 | | (11) One representative from a national trade | 9 | | organization representing property and casualty insurers, | 10 | | appointed by the Governor. | 11 | | (12) One representative from a national trade | 12 | | organization representing mutual insurance companies, | 13 | | appointed by the Governor. | 14 | | (13) One representative from a national trade | 15 | | association representing insurance compliance | 16 | | professionals, appointed by the Governor. | 17 | | (14) One representative from a trade organization | 18 | | representing insurance agents, appointed by the Governor. | 19 | | The appointments under paragraphs (4) through (14) of this | 20 | | subsection shall be made no later than December 31, 2025. The | 21 | | Director of Insurance or the Director's designee shall serve | 22 | | as the Chair of the Task Force. | 23 | | (d) Subject to appropriation, the Office of Risk | 24 | | Management and Insurance Research at the University of | 25 | | Illinois shall provide technical support and guidance to the | 26 | | Task Force on matters of insurance marketplace analysis, |
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| 1 | | including conducting market studies as requested by the Task | 2 | | Force. | 3 | | (e) Subject to appropriation, the Task Force shall engage | 4 | | with a third-party actuarial firm to oversee the technical | 5 | | analysis of the Illinois insurance market and the | 6 | | determinations of what impacts, if any, rate review and the | 7 | | prohibition of rate-making based on factors set forth in | 8 | | paragraph (7) of subsection (a) would have on the Illinois | 9 | | insurance market. | 10 | | (f) A majority of the voting members of the Task Force | 11 | | constitutes a quorum for the transacting of business. Official | 12 | | action by the Task Force requires the approval of a majority of | 13 | | the members of the Task Force. | 14 | | (g) The Task Force shall meet at least quarterly but may | 15 | | meet more often if needed to fulfill any of its duties. | 16 | | (h) The Task Force is dissolved after it submits the | 17 | | report required under subsection (a), and this Section is | 18 | | repealed July 1, 2028. | 19 | | (215 ILCS 5/143.19.6 new) | 20 | | Sec. 143.19.6. Use of credit score and age in determining | 21 | | rates or premiums for certain vehicle insurance; prohibited. | 22 | | (a) An individual's credit score shall not be considered | 23 | | when determining rates or premiums for insurance on risks in | 24 | | this State described in clause (b) of Class 2 and clause (e) of | 25 | | Class 3 of Section 4 of this Code. |
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| 1 | | (b) A policy of automobile insurance, including any class | 2 | | of motor vehicle coverage, may not be canceled by the insurer | 3 | | solely because the insured has reached the age of 65 years so | 4 | | long as the insured has a valid Illinois driver's license. An | 5 | | insurer shall not refuse to issue a renewal policy or increase | 6 | | the premium for any policy solely because an insured has | 7 | | reached the age of 65 years. | 8 | | (c) This Section is repealed January 1, 2028. | 9 | | (215 ILCS 5/424) (from Ch. 73, par. 1031) | 10 | | Sec. 424. Unfair methods of competition and unfair or | 11 | | deceptive acts or practices defined. The following are hereby | 12 | | defined as unfair methods of competition and unfair and | 13 | | deceptive acts or practices in the business of insurance: | 14 | | (1) The commission by any person of any one or more of | 15 | | the acts defined or prohibited by Sections 134, 143.24c, | 16 | | 147, 148, 149, 151, 155.22, 155.22a, 155.42, 236, 237, | 17 | | 364, 469, and 513b1 of this Code. | 18 | | (2) Entering into any agreement to commit, or by any | 19 | | concerted action committing, any act of boycott, coercion | 20 | | or intimidation resulting in or tending to result in | 21 | | unreasonable restraint of, or monopoly in, the business of | 22 | | insurance. | 23 | | (3) Making or permitting, in the case of insurance of | 24 | | the types enumerated in Classes 1, 2, and 3 of Section 4, | 25 | | any unfair discrimination between individuals or risks of |
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| 1 | | the same class or of essentially the same hazard and | 2 | | expense element because of the race, color, religion, or | 3 | | national origin of such insurance risks or applicants. The | 4 | | application of this Article to the types of insurance | 5 | | enumerated in Class 1 of Section 4 shall in no way limit, | 6 | | reduce, or impair the protections and remedies already | 7 | | provided for by Sections 236 and 364 of this Code or any | 8 | | other provision of this Code. | 9 | | (4) Engaging in any of the acts or practices defined | 10 | | in or prohibited by Sections 154.5 through 154.8 of this | 11 | | Code. | 12 | | (5) Making or charging any rate for insurance against | 13 | | losses arising from the use or ownership of a motor | 14 | | vehicle which requires a higher premium of any person by | 15 | | reason of his physical disability, race, color, religion, | 16 | | gender, or national origin. | 17 | | (6) Failing to meet any requirement of the Unclaimed | 18 | | Life Insurance Benefits Act with such frequency as to | 19 | | constitute a general business practice. | 20 | | (Source: P.A. 102-778, eff. 7-1-22.) | 21 | | Section 10. The Illinois Vehicle Code is amended by adding | 22 | | Section 7-612 as follows: | 23 | | (625 ILCS 5/7-612 new) | 24 | | Sec. 7-612. Exemption upon demonstration of financial |
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| 1 | | need. Upon a verified demonstration of financial need by the | 2 | | owner, the Secretary may waive the reinstatement fee | 3 | | established in Section 7-606. | 4 | | Section 99. Effective date. This Act takes effect January | 5 | | 1, 2025, except that Section 143.9.16 of the Illinois | 6 | | Insurance Code takes effect January 1, 2026.". |
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