093_SB0907

 
                                     LRB093 09669 JLS 09908 b

 1        AN ACT concerning service contracts.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  Service  Contract  Act  is  amended  by
 5    changing Section 20 as follow:

 6        (215 ILCS 152/20)
 7        Sec. 20.  Reimbursement policy; required provisions.
 8        (a)  A No service contract reimbursement insurance policy
 9    may not shall be issued, sold, or offered for  sale  in  this
10    State  unless the policy states that the issuer of the policy
11    will reimburse or pay  on  behalf  of  the  service  contract
12    provider all covered sums which the service contract provider
13    is  legally obligated to pay or will provide the service that
14    the service contract provider is legally obligated to perform
15    according to  the  service  contract  provider's  contractual
16    obligations  under  the  provisions  of  the  insured service
17    contracts issued or sold by the service contract provider.
18        (b)  If covered service is not provided  by  the  service
19    contract  provider  within  60  days  of proof of loss by the
20    service contract holder,  the  service  contract  holder  may
21    file  directly with the insurance company writing the service
22    contract reimbursement insurance policy.
23        (c)  A service contract reimbursement  insurance  company
24    that  insures  a  service  contract  shall  be deemed to have
25    received payment of  the  premium  if  the  service  contract
26    holder paid for the service contract coverage.
27        (d)  If  a  service  contract  is  canceled  by a service
28    contract holder, the service contract reimbursement insurance
29    company shall be required  to  return  the  unearned  service
30    contract reimbursement insurance premium for that contract to
31    the   insured  service  contract  provider.  If  the  service
 
                            -2-      LRB093 09669 JLS 09908 b
 1    contract provider fails to refund the amounts required  under
 2    Section  35  of  this Act, the service contract reimbursement
 3    insurance company shall be responsible for the refund to  the
 4    service contract holder.
 5    (Source: P.A. 90-711, eff. 8-7-98.)