Illinois General Assembly - Full Text of Public Act 099-0542
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Public Act 099-0542


 

Public Act 0542 99TH GENERAL ASSEMBLY

  
  
  

 


 
Public Act 099-0542
 
SB2944 EnrolledLRB099 16156 EGJ 40482 b

    AN ACT concerning regulation.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Illinois Insurance Code is amended by
changing Section 35A-15 as follows:
 
    (215 ILCS 5/35A-15)
    Sec. 35A-15. Company action level event.
    (a) A company action level event means any of the following
events:
        (1) The filing of an RBC Report by an insurer that
    indicates that:
            (A) the insurer's total adjusted capital is
        greater than or equal to its regulatory action level
        RBC, but less than its company action level RBC;
            (B) the insurer, if a life, health, or life and
        health insurer or a fraternal benefit society, has
        total adjusted capital that is greater than or equal to
        its company action level RBC, but less than the product
        of its authorized control level RBC and 3.0 and has a
        negative trend; or
            (C) the insurer, if a property and casualty
        insurer, has total adjusted capital that is greater
        than or equal to its company action level RBC, but less
        than the product of its authorized control level RBC
        and 3.0 and triggers the trend test determined in
        accordance with the trend test calculation included in
        the property and casualty RBC Instructions.
            (D) the insurer, if a health organization, has
        total adjusted capital that is greater than or equal to
        its company action level RBC but less than the product
        of its authorized control level RBC and 3.0 and
        triggers the trend test determined in accordance with
        the trend test calculation included in the Health RBC
        Instructions.
        (2) The notification by the Director to the insurer of
    an Adjusted RBC Report that indicates an event described in
    paragraph (1), provided the insurer does not challenge the
    Adjusted RBC Report under Section 35A-35.
        (3) The notification by the Director to the insurer
    that the Director has, after a hearing, rejected the
    insurer's challenge under Section 35A-35 to an Adjusted RBC
    Report that indicates the event described in paragraph (1).
    (b) In the event of a company action level event, the
insurer shall prepare and submit to the Director an RBC Plan
that does all of the following:
        (1) Identifies the conditions that contribute to the
    company action level event.
        (2) Contains proposed corrective actions that the
    insurer intends to take and that are expected to result in
    the elimination of the company action level event. A health
    organization is not prohibited from proposing recognition
    of a parental guarantee or a letter of credit to eliminate
    the company action level event; however the Director shall,
    at his discretion, determine whether or the extent to which
    the proposed parental guarantee or letter of credit is an
    acceptable part of a satisfactory RBC Plan or Revised RBC
    Plan.
        (3) Provides projections of the insurer's financial
    results in the current year and at least the 4 succeeding
    years, both in the absence of proposed corrective actions
    and giving effect to the proposed corrective actions,
    including projections of statutory operating income, net
    income, capital, and surplus. The projections for both new
    and renewal business may include separate projections for
    each major line of business and separately identify each
    significant income, expense, and benefit component.
        (4) Identifies the key assumptions affecting the
    insurer's projections and the sensitivity of the
    projections to the assumptions.
        (5) Identifies the quality of, and problems associated
    with, the insurer's business including, but not limited to,
    its assets, anticipated business growth and associated
    surplus strain, extraordinary exposure to risk, mix of
    business, and use of reinsurance, if any, in each case.
    (c) The insurer shall submit the RBC Plan to the Director
within 45 days after the company action level event occurs or
within 45 days after the Director notifies the insurer that the
Director has, after a hearing, rejected its challenge under
Section 35A-35 to an Adjusted RBC Report.
    (d) Within 60 days after an insurer submits an RBC Plan to
the Director, the Director shall notify the insurer whether the
RBC Plan shall be implemented or is, in the judgment of the
Director, unsatisfactory. If the Director determines the RBC
Plan is unsatisfactory, the notification to the insurer shall
set forth the reasons for the determination and may set forth
proposed revisions that will render the RBC Plan satisfactory
in the judgment of the Director. Upon notification from the
Director, the insurer shall prepare a Revised RBC Plan, which
may incorporate by reference any revisions proposed by the
Director. The insurer shall submit the Revised RBC Plan to the
Director within 45 days after the Director notifies the insurer
that the RBC Plan is unsatisfactory or within 45 days after the
Director notifies the insurer that the Director has, after a
hearing, rejected its challenge under Section 35A-35 to the
determination that the RBC Plan is unsatisfactory.
    (e) In the event the Director notifies an insurer that its
RBC Plan or Revised RBC Plan is unsatisfactory, the Director
may, at the Director's discretion and subject to the insurer's
right to a hearing under Section 35A-35, specify in the
notification that the notification constitutes a regulatory
action level event.
    (f) Every domestic insurer that files an RBC Plan or
Revised RBC Plan with the Director shall file a copy of the RBC
Plan or Revised RBC Plan with the chief insurance regulatory
official in any state in which the insurer is authorized to do
business if that state has a law substantially similar to the
confidentiality provisions in subsection (a) of Section 35A-50
and if that official requests in writing a copy of the plan.
The insurer shall file a copy of the RBC Plan or Revised RBC
Plan in that state no later than the later of 15 days after
receiving the written request for the copy or the date on which
the RBC Plan or Revised RBC Plan is filed under subsection (c)
or (d) of this Section.
(Source: P.A. 97-955, eff. 8-14-12; 98-157, eff. 8-2-13.)
 
    Section 99. Effective date. This Act takes effect upon
becoming law.

Effective Date: 7/8/2016