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91_SB0363eng SB363 Engrossed LRB9100321JSpcB 1 AN ACT concerning the licensing of insurance producers. 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 Sections 491.1, 492.2, 494.1, 496.2, 497.1, 499.1, 6 505.1, 508.2, 509.1, and 510.2 and adding Section 495.2 as 7 follows: 8 (215 ILCS 5/491.1) (from Ch. 73, par. 1065.38-1) 9 Sec. 491.1. Definitions. In addition to the definitions 10 in Section 2, the following definitions apply to this 11 Article. 12 "Car rental limited licensee" means a person authorized 13 pursuant to the provisions of Section 495.2 to sell certain 14 coverages relating to the rental of vehicles. 15(a)Insurance. Insurance is any of the classes of 16 insurance found in Section 4. 17(b)Insurance producer. An insurance producer is an 18 individual who solicits, negotiates, effects, procures, 19 renews, continues or binds policies of insurance covering 20 property or risks located in Illinois. 21(c)License. A license is a document authorizing an 22 individual to act as an insurance producer, limited insurance 23 representative or temporary insurance producer, as specified 24 in such document. 25(d)Limited insurance representative. A limited 26 insurance representative is an individual appointed by an 27 insurance company, health maintenance organization, or 28 limited health service organization to represent that company 29 or organization regarding the types of insurance set forth in 30 Section 495.1. 31(e)Registered firm. A registered firm is a SB363 Engrossed -2- LRB9100321JSpcB 1 corporation, partnership, or limited liability company which 2 transacts the business of insurance as an insurance agency. 3 "Rental agreement" means a written agreement setting 4 forth the terms and conditions governing the use of a vehicle 5 provided by a rental company for rental or lease. 6 "Rental company" means a person, or a franchisee of such 7 person, in the business of providing primarily private 8 passenger vehicles to the public under a rental agreement for 9 a period not to exceed 30 days. 10 "Rental period" means the term of the rental agreement. 11 "Renter" means a person obtaining the use of a vehicle 12 from a rental company under the terms of a rental agreement 13 for a period not to exceed 30 days. 14 "Vehicle" or "rental vehicle" means a motor vehicle of 15 (1) the private passenger type, including passenger vans, 16 minivans, and sport utility vehicles or (2) the cargo type, 17 including cargo vans, pickup trucks, and trucks with a gross 18 vehicle weight of less than 26,000 pounds the operation of 19 which does not require the operator to possess a commercial 20 driver's license. 21 (Source: P.A. 90-499, eff. 8-19-97.) 22 (215 ILCS 5/492.2) (from Ch. 73, par. 1065.39-2) 23 Sec. 492.2. License Required. 24 (a) No person shall act as or hold himself out to be an 25 insurance producer unless duly licensed in accordance with 26 this Article for the class or classes of insurance as to 27 which he acts or holds himself out as an insurance producer. 28 (b) No person shall, for a fee, engage in the business 29 of offering any advice, counsel, opinion or service with 30 respect to the benefits, advantages or disadvantages under 31 any policy of insurance that could be issued in Illinois, 32 unless that person is 33 (1) engaged or employed as an attorney licensed to SB363 Engrossed -3- LRB9100321JSpcB 1 practice law and performing duties incidental to that 2 position; 3 (2) a licensed insurance producer, limited insurance 4 representative or temporary insurance producer offering 5 advice concerning a class of insurance as to which he is 6 licensed to transact business; 7 (3) a trust officer of a bank performing duties 8 incidental to his position; 9 (4) an actuary or a certified public accountant engaged 10 or employed in a consulting capacity, performing duties 11 incidental to that position; or 12 (5) a licensed public adjuster acting within the scope 13 of his license. 14 (c) In addition to any other penalty set forth in this 15 Article, any individual violating paragraph (a) or (b) is 16 guilty of a Class A misdemeanor. Any individual violating 17 paragraph (a) or (b) and misappropriating or converting any 18 monies collected in conjunction with such violation is guilty 19 of a Class 4 felony. 20 (Source: P.A. 83-801.) 21 (215 ILCS 5/494.1) (from Ch. 73, par. 1065.41-1) 22 Sec. 494.1. Insurance producer license; application and 23 examination. 24 (a) Each application for an insurance producer license 25 shall be made on a form specified by the Director, and shall 26 be signed by the applicant declaring under penalty of 27 refusal, suspension or revocation of the license that the 28 statements made in the application are true, correct and 29 complete to the best of the applicant's knowledge and belief. 30 Before approving the application, the Director shall satisfy 31 himself that the applicant (1) is at least 18 years of age; 32 (2) is competent, trustworthy and of good business 33 reputation; (3) has completed a pre-licensing course of SB363 Engrossed -4- LRB9100321JSpcB 1 study; and (4) has certified that the, pursuant to Section2508.2, filed abond required by Section 508.2whichis in 3 force and effect or that the applicant is exempt from the 4 requirement of obtainingfilingsuch bond; and (5) has paid 5 the fees required by Section 509.1. A pre-licensing course 6 of study for each class of insurance for which an insurance 7 producer license is requested shall be established in 8 accordance with rules and regulations prescribed by the 9 Director and shall consist of the following minimum hours: 10 Class of Insurance Number of Hours 11 Life (Class 1 (a)) 15 12 Accident/Health (Class 1(b) or 2(a)) 15 13 Fire (Class 3) 15 14 Casualty (Class 2) 15 15 Motor Vehicle (Class 2(b) or 3(e)) 7 1/2 16 (b) Applicants for an insurance producer license shall 17 pass, within 90 days of each other, both part one and part 2 18 of a written examination unless exempt pursuant to Section 19 498.1. The examination shall reasonably test the knowledge 20 of the applicant concerning the class or classes of insurance 21 for which a license is applied, the duties and 22 responsibilities of an insurance producer and the insurance 23 laws and rules of Illinois. The examinations provided for by 24 this Section shall be conducted under rules and regulations 25 prescribed by the Director. The Director may make 26 arrangements, including contracting with an outside testing 27 service, for administering such examinations and collecting 28 the non-refundable application fee provided for by Section 29 509.1. 30 Each applicant required to take an examination shall, at 31 the time of request for examination, enclose with the 32 application a non-refundable application fee payable to the 33 Director, as provided for in Section 509.1, plus a separate 34 remittance payable to the designated testing service for the SB363 Engrossed -5- LRB9100321JSpcB 1 total fees the testing service charges for each of the 2 various services being requested by the applicant. An 3 applicant who fails to appear for the examination as 4 scheduled, or appears but fails to pass, shall not be 5 entitled to any refund, and shall be required to submit a new 6 request for examination together with all of the requisite 7 fees before being rescheduled for another examination at a 8 later date. 9 (c) Before each license renewal, an insurance producer 10 shall satisfactorily complete at least 3015hours of course 11 study in accordance with rules prescribed by the Director. 12 The Director may not approve a course of study unless the 13 course provides for classroom, seminar, or self-study 14 instruction methods. A course given in a combination 15 instruction method of classroom or seminar and self-study 16 shall be deemed to be a self-study course unless the 17 classroom or seminar certified hours meets or exceeds 18 two-thirds of total hours certified for the course. The 19 self-study material used in the combination course must be 20 directly related to and complement the classroom portion of 21 the course in order to be considered for credit. An 22 instruction method other than classroom or seminar shall be 23 considered as self-study methodology. Self-study credit 24 hours require the successful completion of an examination 25 covering the self-study material, which shall not be 26 self-evaluated. Provided, however, that if the self-study 27 material is completed through the use of an approved 28 computerized interactive format whereby the computer 29 validates the successful completion of the self-study 30 material, no additional examination shall be required. The 31 self-study credit hours contained in a certified course shall 32 be considered classroom hours when at least two-thirds of the 33 hours are given as classroom or seminar instruction. 34 (d) An insurance producer license shall automatically SB363 Engrossed -6- LRB9100321JSpcB 1 terminate when an insurance producer fails to successfully 2 meet the requirements of paragraph (c) of this Section. 3 (e) The holder of an insurance producer license shall 4 inform the Director in writing of a change in his residential 5 address within 30 days of such change. 6 (f) Each provider of a prelicensing or continuing 7 education course required by this Section shall pay a 8 registration fee and a course certification fee for each 9 course being certified as provided by Section 509.1. 10 (Source: P.A. 89-152, eff. 1-1-97.) 11 (215 ILCS 5/495.2 new) 12 Sec. 495.2. Car rental limited license for rental 13 companies. 14 (a) A rental company must obtain a producer license, 15 become a registered firm, or obtain a car rental limited 16 license before offering or selling insurance in connection 17 with and incidental to the rental of vehicles. The sale of 18 the insurance may occur at the rental office or by 19 pre-selection of coverage in a master, corporate, group 20 rental, or individual agreement. The following general 21 categories of coverage may be offered or sold: 22 (1) personal accident insurance covering the risks 23 of travel including, but not limited to, accident and 24 health insurance that provides coverage, as applicable, 25 to renters and other rental vehicle occupants for 26 accidental death or dismemberment and reimbursement for 27 medical expenses resulting from an accident that occurs 28 during the rental period; 29 (2) liability insurance, including uninsured and 30 underinsured motorist coverage, that provides coverage, 31 as applicable, to renters and other authorized drivers of 32 rental vehicles for liability arising from the operation 33 of the rental vehicle; SB363 Engrossed -7- LRB9100321JSpcB 1 (3) personal effects insurance that provides 2 coverage, as applicable, to renters and other vehicle 3 occupants for the loss of, or damage to, personal effects 4 that occurs during the rental period; 5 (4) roadside assistance and emergency sickness 6 protection programs; 7 (5) any other travel or auto-related coverage that 8 a rental company offers in connection with and incidental 9 to the rental of vehicles. 10 (b) No insurance may be offered by a car rental limited 11 licensee pursuant to this Section unless: 12 (1) the rental company has applied for and obtained 13 a car rental limited license; 14 (2) the rental period of the rental agreement does 15 not exceed 30 consecutive days; 16 (3) at every rental location where rental 17 agreements are executed, brochures or other written 18 materials are readily available to the prospective renter 19 that: 20 (A) summarize clearly and correctly, the 21 material terms of coverage offered to renters, 22 including the identity of the insurer; 23 (B) disclose that the coverage offered by the 24 rental company may provide a duplication of coverage 25 already provided by a renter's personal automobile 26 insurance policy, homeowner's insurance policy, 27 personal liability insurance policy, or other source 28 of coverage; 29 (C) state that the purchase by the renter of 30 the kinds of coverage specified in this Section is 31 not required in order to rent a vehicle; and 32 (D) describe the process for filing a claim in 33 the event the renter elects to purchase coverage and 34 in the event of a claim; and SB363 Engrossed -8- LRB9100321JSpcB 1 (4) evidence of coverage in the rental agreement is 2 disclosed to every renter who elects to purchase such 3 coverage. 4 (c) Car rental company franchisees shall apply for a car 5 rental limited license independent of the franchisor if 6 insurance provided pursuant to this Section is offered by the 7 franchisee. 8 (d) A car rental limited license issued under this 9 Section shall also authorize any employee of the car rental 10 limited licensee to act individually on behalf and under the 11 supervision of the car rental limited licensee with respect 12 to the kinds of coverage specified in this Section. 13 (e) A rental company licensed pursuant to this Section 14 shall conduct a training program in which employees being 15 trained shall receive basic instruction about the kinds of 16 coverage specified in this Section and offered for purchase 17 by prospective renters of rental vehicles. 18 (f) Notwithstanding any other provision of this Section 19 or any rule adopted by the Director, a car rental limited 20 licensee pursuant to this Section shall not be required to 21 treat moneys collected from renters purchasing insurance when 22 renting vehicles as funds received in a fiduciary capacity, 23 provided that the charges for coverage shall be itemized and 24 be ancillary to a rental transaction. 25 (g) The sale of insurance not in conjunction with a 26 rental transaction shall not be permitted. 27 (h) No car rental limited licensee under this Section 28 shall advertise, represent, or otherwise hold itself or any 29 of its employees out as licensed insurers, insurance 30 producers, insurance agents, or insurance brokers. 31 (i) No direct commissions may be paid to rental car 32 company employees by the insurer or the customer purchasing 33 insurance products. The rental car company may include 34 insurance products in an overall employee performance SB363 Engrossed -9- LRB9100321JSpcB 1 compensation incentive program. 2 (j) An application for a car rental limited license 3 shall be made on a form specified by the Director. 4 (215 ILCS 5/496.2) (from Ch. 73, par. 1065.43-2) 5 Sec. 496.2. License. 6 (a) Insurance producer. 7 (1) An applicant who has met the requirements of 8 Section 494.1 shall be issued a perpetual insurance 9 producer license. 10 (2) Each insurance producer license shall remain in 11 effect as long as the holder of the licensemaintains in12force and effect the bond required by Section 508.2 and13 pays theannualfee required by Section 509.1 by the date 14 due, unless the license is revoked or suspended pursuant 15 to Section 505.1. Theannualfee required by Section 16 509.1 shall not be required of a licensed insurance 17 producer who enters the military service of the United 18 States. This waiver shall continue in effect until such 19 time as the insurance producer is discharged from the 20 military service. 21 (3) An insurance producer who does not maintain his 22 insurance producer license in effect pursuant to 23 paragraph(a)(2) of this subsectionSectionmay, within 24 36 months from the due date of the unpaidannualfee, 25 make application for the same license without the 26 necessity of passing a written examination. Payment of 27 theannualfeeand proof a bond is in forcemust 28 accompany the application. In addition, proof of 29 compliance with Section 494.1(c) must be received by the 30 Department before the license is issuedaccompany the31application, where applicable. 32 If an insurance producer fails to pay theannualfee 33 by the due date but applies for reinstatement of the SB363 Engrossed -10- LRB9100321JSpcB 1 license within 36 months of the due date, then the 2 producer shall pay the reinstatement fee required by 3 Section 509.1 of this Code and either: 4 A. Theannuallicense fee which will cause a 5 license to be issued with a current effective date; 6 or 7 B. Theannuallicense fee which will cause a 8 license to be dated the expiration date of the last 9 active license, provided the producer applies for 10 reinstatement within 2 months of the due date. 11 If a license is issued pursuant to option A of 12 this paragraph with a lapse in licensing, the 13 producer must sign a statement attesting that he has 14 not been active as an insurance producer during the 15 period since the last active license. 16 (4) Of the insurance producer licenses renewed 17 during the one-year period following the effective date 18 of this amendatory Act of the 91st General Assembly, 19 approximately 50% shall be for a duration of one year and 20 approximately 50% shall be for a duration of 2 years. 21 All subsequent renewals shall be for a duration of 2 22 years. 23 For the first license renewal period following the 24 effective date of this amendatory Act of the 91st General 25 Assembly, producers renewing a license for one year shall 26 have no continuing education requirement; producers renewing 27 a license for 2 years shall satisfactorily complete at least 28 15 hours of continuing education. All subsequent renewals 29 shall meet the continuing education requirements pursuant to 30 subsection (c) of Section 494.1 of this Act. 31 (b) Limited Insurance Representative. 32 (1) An applicant who has met the requirements of 33 Section 495.1 shall be issued a perpetual limited 34 insurance representative license. SB363 Engrossed -11- LRB9100321JSpcB 1 (2) AEachlimited insurance representative license 2 shall remain in effect as long as the appointing 3 insurance company pays the respective fee required by 4 Section 509.1 prior to January 1 of each year, unless the 5 license is revoked or suspended pursuant to Section 6 505.1. Failure of the insurance company to pay the 7 license fee or to submit the required documents shall 8 cause immediate termination of the limited insurance 9 representative license regarding which such failure 10 occurs. 11 (3) AEachlimited insurance representative license 12 may be terminated by the insurance company or the 13 licensee. 14 (c) Car rental limited licenses. 15 (1) An applicant who has met the requirements of 16 Section 495.2 shall be issued a car rental limited 17 license. 18 (2) A car rental limited license for a rental 19 company shall remain in effect as long as the car rental 20 limited licensee pays the respective fee required by 21 Section 509.1 prior to the next fee date unless the car 22 rental license is revoked or suspended pursuant to 23 Section 505.1. Failure of the car rental limited 24 licensee to pay the license fee or to submit the required 25 documents shall cause immediate suspension of the car 26 rental limited license. 27 (3) A car rental limited license for rental 28 companies may be voluntarily terminated by the car rental 29 limited licensee. The license fee shall not be refunded 30 upon termination of the car rental limited license by the 31 car rental limited licensee. 32 (d)(c)License Content. TheEachlicense shall contain 33 the name, residential address and personal identification 34 number of the licensee, the date the license was issued, SB363 Engrossed -12- LRB9100321JSpcB 1 general conditions relative to the license's expiration or 2 termination, the class or classes of insurance covered by the 3 license, and any other information the Director considers 4 proper. AEachlimited insurance representative license 5 shall also contain the name and address of the appointing 6 insurance company. 7 (Source: P.A. 88-313.) 8 (215 ILCS 5/497.1) (from Ch. 73, par. 1065.44-1) 9 Sec. 497.1. Nonresident licensing. 10 (a) A nonresident may apply for an insurance producer 11 license or limited insurance representative license if (1) 12 the applicant holds a similar license from his state of 13 residence and (2) the applicant's state of residence accepts 14 Illinois residents for licensing. Each nonresident applicant 15 shall be in compliance with the requirements of subsection 16paragraph(a) of Section 494.1, except that requirement (3) 17 of subsectionparagraph(a) shall not be applicable to 18 nonresident applicants. 19 (b) The requirements of subsectionparagraph(c) of 20 Section 494.1 shall not apply to nonresident applicants. If 21 an applicant's state of residence accepts compliance with the 22 requirements of subsectionparagraph(c) of Section 494.1 by 23 an Illinois insurance producer as compliance with that 24 state's continuing education requirements, a nonresident 25 applicant may fulfill the requirements of subsection 26paragraph(c) of Section 494.1 by demonstrating compliance 27 with the continuing education requirements of the applicant's 28 state of residence. A nonresident applicant may be licensed 29 without written examination if (1) the state in which the 30 applicant resides requires no similar examination or (2) the 31 public official having supervision of insurance in the 32 applicant's state of residence certifies that the applicant 33 has passed a written examination for the classes of insurance SB363 Engrossed -13- LRB9100321JSpcB 1 applied for or was licensed prior to the time a written 2 examination was required. 3 (c) A nonresident applicant shall file with the Director 4 an affidavit appointing the Director and his or her successor 5 in office as such applicant's agent upon whom all lawful 6 process in any action, suit or legal proceeding against the 7 applicant may be served, and shall agree that any such lawful 8 process is of the same legal force and validity as personal 9 service of process upon such applicant. The Director shall, 10 within 10 days after receiving process, forward a copy of 11 such process by registered or certified mail to the 12 individual for whom he has received such process at the 13 individual's address of record. 14 (d) Whenever, by the laws or regulations of any other 15 state, any limitation of rights and privileges, conditions 16 precedent, or any other requirements are imposed upon 17 residents of this State who are nonresident applicants or 18 licensees of such other state in addition to, or in excess 19 of, those imposed on nonresidents under this Code, the same 20 such requirements shall be imposed upon such residents of 21 such other state. 22 (Source: P.A. 89-152, eff. 1-1-97.) 23 (215 ILCS 5/499.1) (from Ch. 73, par. 1065.46-1) 24 Sec. 499.1. Registered firms. 25 (a) Any corporation, partnership, or limited liability 26 company transacting insurance business as an insurance agency 27 shall register with the Director before transacting insurance 28 business in this State. Such registration shall remain in 29 effect as long as the firm pays theannualfee required by 30 Section 509.1 of this Code by the date due, unless the 31 registration is revoked or suspended pursuant to Section 32 505.1 of this Code. 33 (b) Each firm required to register before acting as a SB363 Engrossed -14- LRB9100321JSpcB 1 registered firm pursuant to this Article shall appoint one or 2 more licensed insurance producers who are officers, 3 directors, or partners in the firm to be responsible for the 4 firm's compliance with the insurance laws and Title 50 of the 5 Illinois Administrative Code. Such individual or individuals 6 shall submit to the Director a registration form and the fees 7 required by Section 509.1. The Director shall prescribe the 8 registration form and may require any documents reasonably 9 necessary to verify the information contained in the 10 registration form. Within 30 days of a change in officers, 11 directors, or partners who are appointed to be responsible 12 for the firm's compliance with the insurance laws and Title 13 50 of the Illinois Administrative Code, the firm shall report 14 the change to the Department. 15 (c) The registered firm shall inform the Director in 16 writing of a change in its business address within 30 days of 17 such change. 18 (d) Each registered firm shall disclose its members, 19 officers or directors who are authorized to act as insurance 20 producers, and report any changes in such personnel to the 21 Director within 30 days of such changes. 22 (e) (Blank). 23 (Source: P.A. 89-240, eff. 1-1-96; 90-41, eff. 10-1-97; 24 90-499, eff. 8-19-97; 90-655, eff. 7-30-98.) 25 (215 ILCS 5/505.1) (from Ch. 73, par. 1065.52-1) 26 Sec. 505.1. License suspension, revocation, or denial. 27 (a) Any license issued under this Article may be 28 suspended or revoked, and any application for a license may 29 be denied, if the Director finds that the licensee or 30 applicant: 31 (1) has wilfully violated any provision of this 32 Code or any rule or regulation promulgated by the 33 Director; SB363 Engrossed -15- LRB9100321JSpcB 1 (2) has intentionally made a material misstatement 2 in his application for a license; 3 (3) has obtained or attempted to obtain a license 4 through misrepresentation or fraud; 5 (4) has misappropriated or converted to his own 6 use, or improperly withheld, money required to be held in 7 a fiduciary capacity; 8 (5) has intentionally misrepresented the terms of 9 any actual or proposed insurance policy; 10 (6) has, in the transaction of business under his 11 license, used fraudulent, coercive or dishonest 12 practices, or has demonstrated incompetence, 13 untrustworthiness or financial irresponsibility; 14 (7) has been, within the past 3 years, convicted of 15 a felony, unless the individual demonstrates to the 16 Director sufficient rehabilitation to warrant the public 17 trust; 18 (8) has knowingly accepted insurance business from 19 an individual who is not licensed; 20 (9) has failed to appear without reasonable cause 21 or excuse in response to a subpoena lawfully issued by 22 the Director; 23 (10) has had his license suspended or revoked or 24 his application denied in any other State, district, 25 territory or province on grounds similar to those stated 26 in this Section; 27 (11) (Blank)has violated any of the provisions of28Section 504.1; 29 (12) has failed to meet the education requirements 30 of subsectionparagraph(c) of Section 494.1; 31 (13) has failed to report a felony conviction, as 32 required by Section 503.1; 33 (14) has knowingly employed, contracted or engaged 34 in any insurance related capacity any person whose SB363 Engrossed -16- LRB9100321JSpcB 1 license as an insurance producer or limited insurance 2 representative has been revoked within the previous three 3 years or whose request for a license has been refused or 4 suspended pursuant to this Section at the time of such 5 employment, engaging or contracting; or 6 (15) has failed to make satisfactory repayment to 7 the Illinois Student Assistance Commission for a 8 delinquent or defaulted student loan. 9 (b) Suspension or revocation of a license or the denial 10 of an application pursuant to this Section shall be by 11 written order sent to the licensee or applicant by certified 12 or registered mail at the address specified in the records of 13 the Department. The licensee or applicant may in writing 14 request a hearing within 30 days from the date of mailing. 15 If no written request is made, such order shall be final upon 16 the expiration of said 30 days. 17 (c) If the licensee or applicant requests a hearing 18 pursuant to this Section the Director shall issue a written 19 notice of hearing sent to the licensee or applicant by 20 certified or registered mail at his address, as specified in 21 the records of the Department, and stating: 22 (1) the grounds, charges or conduct which justifies 23 suspension or revocation or denial under this Section; 24 (2) a specific time for the hearing, which may not 25 be less than 20 nor more than 30 days after the mailing 26 of the notice of hearing; and 27 (3) a specific place for the hearing, which may be 28 either in the City of Springfield or Chicago or in the 29 county where the licensee's principal place of business 30 is located. 31 (d) Upon the suspension or revocation of a license, the 32 licensee or other person having possession or custody of such 33 license shall promptly deliver it to the Director in person 34 or by mail. The Director shall publish all suspensions and SB363 Engrossed -17- LRB9100321JSpcB 1 revocations after such suspensions or revocations become 2 final in a manner designed to notify interested insurance 3 companies and other persons. 4 (e) Any individual whose license is revoked or whose 5 application is denied pursuant to this Section shall be 6 ineligible to apply for any license for 3 years. No person 7 whose license as an insurance producer or limited 8 representative has been revoked, suspended or denied shall be 9 employed, contracted or engaged in any insurance related 10 capacity during the time the revocation, suspension or denial 11 is in effect. A suspension pursuant to this Section may be 12 for a period of up to 2 years. 13 (f) In addition to or instead of a denial, suspension or 14 revocation of a license pursuant to this Section, the 15 licensee may be subjected to a civil penalty of up to $1,000 16 for each cause for denial, suspension or revocation. Such 17 penalty is enforceable under Section 403A(5) of this Code. 18 (Source: P.A. 89-318, eff. 1-1-96.) 19 (215 ILCS 5/508.2) (from Ch. 73, par. 1065.55-2) 20 Sec. 508.2. Bond required of Insurance Producers. 21 (1) Each producer and registered firm who places 22 insurance either directly or indirectly with an insurer with 23 which the producer or registered firm does not have an agent 24 contact shall maintain in force while licensed a bond in 25 favor of the people of the State of Illinois executed by an 26 authorized surety company and payable to any party injured 27 under the terms of the bond. The bond shall be continuous in 28 form and in the amount of $2,500 or 5% of the premiums 29 brokered in the previous calendar year, whichever is greater, 30 but not to exceed $50,000 total aggregate liability. The bond 31 shall be conditioned upon full accounting and due payment to 32 the person or company entitled thereto, of funds coming into 33 the insurance producer's possession as an incident to SB363 Engrossed -18- LRB9100321JSpcB 1 insurance transactions under thehislicense or surplus line 2 insurance transactions under thehislicense as a surplus 3 line producer. 4 (2) Authorized insurance producers of a registered firm 5 may meet the requirements of this Section with a bond in the 6 name of the registered firm, continuous in form and in the 7 amounts set forth in subsection (1) of this Section. 8 Insurance producers may meet the requirements of this 9 Section with a bond in the name of an association. An 10 individual producer remains responsible for assuring that a 11 producer bond is in effect and is for the correct amount. 12 The association must have been in existence for 5 years, have 13 common membership, and been formed for a purpose other than 14 obtaining a bond. 15 (3)Such bond shall remain in force and effect until the16surety is released from liability by the Director or until17the bond is canceled by the surety.The surety may cancel the 18 bond and be released from further liability thereunder upon 19 30 days' written notice in advance to the PrincipalDirector. 20 Such cancellation shall not affect any liability incurred or 21 accrued thereunder before the termination of the 30-day 22 period.Upon receipt of any notice of cancellation, the23Director shall immediately notify the licensee.24 (4) Such license may be revokedshall automatically25terminate upon there being no bond in force, orif the 26 producer acts without a bond which is required pursuant to 27 this Section, and the license shall be returned by its lawful28custodian to the Director for cancellation. 29 (5) If a party injured under the terms of the bond 30 requests the producer to provide the name of the surety and 31 the bond number, the producer must provide the information 32 within 3 working days after receiving the request. 33 (6) An association may meet the requirements of this 34 Section for all of its members with a bond in the name of the SB363 Engrossed -19- LRB9100321JSpcB 1 association that is continuous in form and in the amounts set 2 forth in subsection (1) of this Section. 3 (Source: P.A. 88-313.) 4 (215 ILCS 5/509.1) (from Ch. 73, par. 1065.56-1) 5 Sec. 509.1. Fees. 6 (a) The fees required by this Article are as follows: 7 (1) AAn annualfee of $75 per year for an 8 insurance producer license; 9 (2) A fee of $25 for the issuance of a temporary 10 insurance producer license; 11 (3) AAn annualregistration fee of $50 payable 12 once every 2 years$25for a business firm to register; 13 (4) An annual $25 fee for a limited insurance 14 representative license; 15 (5) A $25 application fee for the processing of 16 each request to take the written examination for an 17 insurance producer license; 18 (6) An annual registration fee of $500 for an 19 education provider to register; 20 (7) A certification fee of $25 for each certified 21 prelicensing or continuing education course and an annual 22 fee of $10 for renewing the certification of each such 23 course;and24 (8) A license reinstatement fee of $50 for 25 reinstating a license which lapsed because theannualfee 26 was not received by the due date;.27 (9) A registration fee of $15 for reinstating a 28 firm registration that lapsed because theannualfee was 29 not received by the due date; and.30 (10) A fee of $50 payable once every 2 years for a 31 car rental limited license. 32 (b) Except as otherwise provided, all fees paid to and 33 collected by the Director under this Section shall be paid SB363 Engrossed -20- LRB9100321JSpcB 1 promptly after receipt thereof, together with a detailed 2 statement of such fees, into a special fund in the State 3 Treasury to be known as the Insurance Producer Administration 4 Fund. The monies deposited into the Insurance Producer 5 Administration Fund shall be used only for payment of the 6 expenses of the Department in the execution, administration, 7 and enforcement of the insurance laws of this State, and 8 shall be appropriated as otherwise provided by law for the 9 payment of such expenses with first priority being any 10 expenses incident to or associated with the administration 11 and enforcement of this Article. 12 (Source: P.A. 89-152, eff. 1-1-97; 90-372, eff. 7-1-98; 13 90-655, eff. 7-30-98.) 14 (215 ILCS 5/510.2) (from Ch. 73, par. 1065.57-2) 15 Sec. 510.2. Exemptions from licensing requirements. The 16 provisions of Sections 492.2, 494.1, 495.1, 495.2, 496.2, 17 497.1, 498.1, 499.1, 500.1 and 501.2 shall not apply to: 18 (a) any regularly salaried officer or employee of an 19 insurance company, who is engaged in the performance of usual 20 and customary executive, administrative or clerical duties; 21 (b) salaried employees in the office of an insurance 22 producer, limited insurance representative, car rental 23 limited licensee, or registered firm, who devote their full 24 time to clerical and administrative services, including the 25 incidental taking of insurance applications and receipt of 26 premiums in the office of their employer, as long as such 27 employees do not receive any commissions on such applications 28 and their compensation is not varied by the volume of 29 applications or premiums taken or received, except as 30 authorized under subsection (g) of Section 495.2; 31 (c) persons who secure and furnish information for the 32 purpose of group life insurance, annuities, group or blanket 33 accident and health insurance, or for the purpose of SB363 Engrossed -21- LRB9100321JSpcB 1 enrolling individuals under such plans, issuing certificates 2 under such plans or otherwise assisting in administering such 3 plans, where no commission is paid for such service; 4 (d) advisory organizations, according to Article VIIA of 5 this Code, or persons who furnish information for the purpose 6 of life or accident and health insurance distributed on a 7 mass merchandise basis and administered by group methods; 8 (e) employers or their officers or employees, or the 9 trustees of any employee trust plan, to the extent that such 10 employers, officers, employees or trustees are engaged in the 11 administration or operation of any program of employee 12 benefits for their own employees or the employees of their 13 subsidiaries or affiliates, which program involves the use of 14 insurance issued by an insurance company, as long as such 15 employers, officers, employees or trustees are not in any 16 manner compensated, directly or indirectly, by the company 17 issuing the contracts; or 18 (f) employees of insurance companies or organizations 19 employed by insurance companies who are engaging in the 20 inspection, rating or classification of risks, or in the 21 supervision of the training of insurance producers, limited 22 insurance representatives, car rental limited licensees, or 23 temporary insurance producers, and who are not individually 24 engaged in the solicitation or negotiation of policies or 25 contracts for insurance. 26 (Source: P.A. 83-1299.) 27 Section 99. Effective date. This Act takes effect 28 January 1, 2000.