Several Bills Still Under Consideration in Ill.

The 2003 Illinois General Assembly reached its halfway point, with a host of insurance-related bills including legislation dealing with primary seatbelt enforcement, commercial lines non-renewals and an insurers use of credit, still on the agenda.

“SB 50, the primary enforcement seat belt law, passed the full Senate on April 3 by a vote of 34-24-1. This is an important bill for the National Association of Independent Insurers (NAII) and its member companies who insure more than 44 percent of Illinois drivers. If passed, SB 50 has the potential to save lives,
prevent thousands of injuries, and save insurance consumers and taxpayers millions of dollars,” said Laura Kotelman, NAII legal counsel.

A commercial lines non-renewal bill also passed the Senate by a vote of 57-0-0. SB 559 clarifies that if an insurer in the state plans to not renew a commercial policy, notice must be sent to the customer at least 60 days prior to the expiration date of the policy. “NAII supports SB 559 and was successful in joining forces with other industry representatives to get the bill amended to more accurately address the problematic proof of mailing requirements created by the Guillien v. Potomac decision,” said Kotelman.

State legislatures are also addressing the use of credit-based insurance scores.

HB 1640, which is based in large part on the National Conference of Insurance Legislators (NCOIL) model, needs to be amended in order to conform to Illinois’ insurance rating law. “Under the current bill, in order to consider the absence of credit information, insurers would be required to justify their treatment of individuals with no credit history and obtain department approval. This requirement in essence would negatively affect Illinois’ rating law and be a step towards a prior approval system. We are urging the Senate to fix this unintended consequence of implementing the model act,” said Kotelman.

In addition, SB 318 which amends the definitions section of the surplus line law to make it clear that the “diligent effort” need not include approaching a “residual market mechanism” passed the Senate 58 to 0.