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92_HB1989sam001
LRB9205486JSpcam
1 AMENDMENT TO HOUSE BILL 1989
2 AMENDMENT NO. . Amend House Bill 1989 by replacing
3 everything after the enacting clause with the following:
4 "Section 5. The Illinois Insurance Code is amended by
5 changing Section 205 as follows:
6 (215 ILCS 5/205) (from Ch. 73, par. 817)
7 Sec. 205. Priority of distribution of general assets.
8 (1) The priorities of distribution of general assets
9 from the company's estate shall is to be as follows:
10 (a) The costs and expenses of administration,
11 including the expenses of the Illinois Insurance Guaranty
12 Fund, the Illinois Life and Health Insurance Guaranty
13 Association, the Illinois Health Maintenance Organization
14 Guaranty Association and of any similar organization in
15 any other state as prescribed in subsection (c) of
16 Section 545.
17 (b) Secured claims, including claims for taxes and
18 debts due the federal or any state or local government,
19 that are secured by liens perfected prior to the filing
20 of the complaint.
21 (c) Claims for wages actually owing to employees
22 for services rendered within 3 months prior to the date
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1 of the filing of the complaint, not exceeding $1,000 to
2 each employee unless there are claims due the federal
3 government under paragraph (f), then the claims for wages
4 shall have a priority of distribution immediately
5 following that of federal claims under paragraph (f) and
6 immediately preceding claims of general creditors under
7 paragraph (g).
8 (d) Claims by policyholders, beneficiaries,
9 insureds and liability claims against insureds covered
10 under insurance policies and insurance contracts issued
11 by the company, and claims of the Illinois Insurance
12 Guaranty Fund, the Illinois Life and Health Insurance
13 Guaranty Association, the Illinois Health Maintenance
14 Organization Guaranty Association and any similar
15 organization in another state as prescribed in Section
16 545.
17 (e) Claims by policyholders, beneficiaries, and
18 insureds, the allowed values of which were determined by
19 estimation under paragraph (b) of subsection (4) of
20 Section 209.
21 (f) Any other claims due the federal government.
22 (g) All other claims of general creditors not
23 falling within any other priority under this Section
24 including claims for taxes and debts due any state or
25 local government which are not secured claims and claims
26 for attorneys' fees incurred by the company in contesting
27 its conservation, rehabilitation, or liquidation.
28 (h) Claims of guaranty fund certificate holders,
29 guaranty capital shareholders, capital note holders, and
30 surplus note holders.
31 (i) Proprietary claims of shareholders, members, or
32 other owners.
33 (2) Within 120 days after the issuance of an Order of
34 Liquidation with a finding of insolvency against a domestic
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1 company, the Director shall make application to the court
2 requesting authority to disburse funds to the Illinois
3 Insurance Guaranty Fund, the Illinois Life and Health
4 Insurance Guaranty Association, the Illinois Health
5 Maintenance Organization Guaranty Association and similar
6 organizations in other states from time to time out of the
7 company's marshaled assets as funds become available in
8 amounts equal to disbursements made by the Illinois Insurance
9 Guaranty Fund, the Illinois Life and Health Insurance
10 Guaranty Association, the Illinois Health Maintenance
11 Organization Guaranty Association and similar organizations
12 in other states for covered claims obligations on the
13 presentation of evidence that such disbursements have been
14 made by the Illinois Insurance Guaranty Fund, the Illinois
15 Life and Health Insurance Guaranty Association, the Illinois
16 Health Maintenance Organization Guaranty Association and
17 similar organizations in other states.
18 The Director shall establish procedures for the ratable
19 allocation and distribution of disbursements to the Illinois
20 Insurance Guaranty Fund, the Illinois Life and Health
21 Insurance Guaranty Association, the Illinois Health
22 Maintenance Organization Guaranty Association and similar
23 organizations in other states. In determining the amounts
24 available for disbursement, the Director shall reserve
25 sufficient assets for the payment of the expenses of
26 administration described in paragraph (1) (a) of this
27 Section. All funds available for disbursement after the
28 establishment of the prescribed reserve shall be promptly
29 distributed. As a condition to receipt of funds in
30 reimbursement of covered claims obligations, the Director
31 shall secure from the Illinois Insurance Guaranty Fund, the
32 Illinois Life and Health Insurance Guaranty Association, the
33 Illinois Health Maintenance Organization Guaranty Association
34 and each similar organization in other states, an agreement
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1 to return to the Director on demand funds previously received
2 as may be required to pay claims of secured creditors and
3 claims falling within the priorities established in
4 paragraphs (a), (b), (c), and (d) of subsection (1) of this
5 Section in accordance with such priorities.
6 (3) The provisions of this Section are severable under
7 Section 1.31 of the Statute on Statutes.
8 (Source: P.A. 89-206, eff. 7-21-95; 90-381, eff. 8-14-97.)".