(225 ILCS 427/55)
(Section scheduled to be repealed on January 1, 2020)
Fidelity insurance; segregation of accounts.
(a) A community association manager or the Community Association Management Agency with which he or she is employed shall not have access to and disburse funds of a community association unless each of the following conditions occur:
(1) There is fidelity insurance in place to insure
against loss for theft of community association funds.
(2) The fidelity insurance is not less than all
moneys under the control of the community association manager or the employing Community Association Management Agency for the association.
(3) The fidelity insurance covers the community
association manager and all partners, officers, and employees of the Community Association Management Agency with whom he or she is employed during the term of the insurance coverage, as well as the association officers, directors, and employees.
(4) The insurance company issuing the fidelity
insurance may not cancel or refuse to renew the bond without giving at least 10 days' prior written notice.
(5) Unless an agreement between the community
association and the community association manager or the Community Association Management Agency provides to the contrary, the Association secures and pays for the fidelity insurance. The community association manager and the Community Association Management Agency must be named as additional insured parties on the association policy.
(b) A community association manager or Community Association Management Agency that provides community association management services for more than one community association shall maintain separate, segregated accounts for each community association or, with the consent of the association, combine the accounts of one or more associations, but in that event, separately account for the funds of each association. The funds shall not, in any event, be commingled with the community association manager's or Community Association Management Agency's funds. The maintenance of such accounts shall be custodial, and such accounts shall be in the name of the respective community association or community association manager or Community Association Management Agency as the agent for the association.
(c) The community association manager or Community Association Management Agency shall obtain the appropriate general liability and errors and omissions insurance, as determined by the Department, to cover any losses or claims against community association clients.
(d) The Department shall have authority to promulgate additional rules regarding insurance, fidelity insurance and all accounts maintained and to be maintained by a community association manager or Community Association Management Agency.
(Source: P.A. 96-726, eff. 7-1-10