Illinois General Assembly

  Bills & Resolutions  
  Compiled Statutes  
  Public Acts  
  Legislative Reports  
  IL Constitution  
  Legislative Guide  
  Legislative Glossary  

 Search By Number
 (example: HB0001)
Search Tips

Search By Keyword

Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.

INSURANCE
(215 ILCS 5/) Illinois Insurance Code.

215 ILCS 5/178

    (215 ILCS 5/178)
    Sec. 178. (Repealed).
(Source: Laws 1937, p. 696. Repealed by P.A. 98-692, eff. 7-1-14; 98-969, eff. 1-1-15.)

215 ILCS 5/179

    (215 ILCS 5/179) (from Ch. 73, par. 791)
    Sec. 179. Payment of fees to officer or director prohibited.
    (1) No director or officer of any company, party to a reinsurance agreement, except as fully expressed in the reinsurance agreement, shall receive any fee, commission, other compensation or valuable consideration whatever, directly or indirectly, for in any manner aiding, promoting or assisting in the negotiation of such reinsurance agreement.
    (2) Any person violating the provisions of this section shall be guilty of a Class A misdemeanor.
(Source: P.A. 77-2699.)

215 ILCS 5/179a

    (215 ILCS 5/179a)
    Sec. 179a. Managing general agent prohibition.
    (a) No managing general agent, as defined in Section 141a, shall receive any compensation or remuneration for, or in any manner profit from, obtaining or arranging reinsurance for a domestic company with respect to business underwritten by that managing general agent.
    (b) Any person violating the provisions of this Section is guilty of a Class A misdemeanor.
(Source: P.A. 88-364.)

215 ILCS 5/179b

    (215 ILCS 5/179b)
    Sec. 179b. Reinsurance committee. Each domestic company that cedes any reinsurance must establish and maintain a reinsurance committee with not fewer than 3 members, at least one of which must be a member of the company's board of directors. The committee shall review and approve all treaty reinsurance placements and review and approve guidelines for facultative placements for the company, with the exception of a reinsurance agreement in which the aggregate premium ceded in any one year is less than 1% of the company's annual gross written premium. The committee shall give special attention to reinsurers' financial strength and performance record.
(Source: P.A. 88-364.)

215 ILCS 5/Art. XI.5

 
    (215 ILCS 5/Art. XI.5 heading)
ARTICLE XI 1/2. PROTECTED CELL COMPANIES

215 ILCS 5/179A-1

    (215 ILCS 5/179A-1)
    Sec. 179A-1. Short title. This Article may be cited as the Protected Cell Company Law.
(Source: P.A. 91-278, eff. 7-23-99.)

215 ILCS 5/179A-5

    (215 ILCS 5/179A-5)
    Sec. 179A-5. Purpose. This Article is adopted to provide a basis for the creation of protected cells by a domestic insurer as one means of accessing alternative sources of capital and achieving the benefits of insurance securitization. Investors in fully funded insurance securitization transactions provide funds that are available to pay the insurer's insurance obligations or to repay the investors or both. The creation of protected cells is intended to be a means to achieve more efficiencies in conducting insurance securitizations.
    Under the terms of the typical debt instrument underlying an insurance securitization transaction, prepaid principal is repaid to the investor on a specified maturity date with interest, unless a trigger event occurs. The insurance securitization proceeds secure both the protected cell company's insurance obligations if a trigger event occurs, as well as the protected cell company's obligation to repay the insurance securitization investors if a trigger event does not occur. Insurance securitization transactions have been performed through alien companies in order to utilize efficiencies available to alien companies that are not currently available to domestic companies. This Article is adopted in order to create more efficiency in conducting insurance securitization, to allow domestic companies easier access to alternative sources of capital, and to promote the benefits of insurance securitization generally.
(Source: P.A. 91-278, eff. 7-23-99; 92-74, eff. 7-12-01.)

215 ILCS 5/179A-10

    (215 ILCS 5/179A-10)
    Sec. 179A-10. Definitions.
    "Domestic company" means an insurance company domiciled in the State of Illinois.
    "Fully funded" means that, with respect to any exposure attributed to a protected cell, the market value of the protected cell assets, on the date on which the insurance securitization is effected, equals or exceeds the maximum possible exposure attributable to the protected cell with respect to those exposures.
    "General account" means the assets and liabilities of a protected cell company other than protected cell assets and protected cell liabilities.
    "Indemnity trigger" means a transaction term by which relief of the issuer's obligation to repay investors is triggered by its incurring a specified level of losses under its insurance or reinsurance contracts.
    "Market value" has the meaning given that term in Article VIII of this Code (Investments of Domestic Companies).
    "Non-indemnity trigger" means a transaction term by which relief of the issuer's obligation to repay investors is triggered solely by some event or condition other than the individual protected cell company incurring a specified level of losses under its insurance or reinsurance contracts.
    "Protected cell" means an identified pool of assets and liabilities of a domestic company segregated and insulated by means of this Article from the remainder of the company's assets and liabilities.
    "Protected cell account" means a specifically identified bank or custodial account established by a protected cell company for the purpose of segregating the protected cell assets of one protected cell from the protected cell assets of other protected cells and from the assets of the protected cell company's general account.
    "Protected cell assets" means all assets, contract rights, and general intangibles identified with and attributable to a specific protected cell of a protected cell company.
    "Protected cell company" means a domestic company that has one or more protected cells.
    "Protected cell company insurance securitization" means the issuance of debt instruments, the proceeds from which support the exposures attributed to the protected cell, by a protected cell company where repayment of principal or interest, or both, to investors pursuant to the transaction terms is contingent upon the occurrence or nonoccurrence of an event with respect to which the protected cell company is exposed to loss under insurance or reinsurance contracts it has issued.
    "Protected cell liabilities" means all liabilities and other obligations identified with and attributable to a specific protected cell of a protected cell company.
(Source: P.A. 91-278, eff. 7-23-99; 92-74, eff. 7-12-01.)

215 ILCS 5/179A-15

    (215 ILCS 5/179A-15)
    Sec. 179A-15. Establishment of protected cells.
    (a) A domestic company may, with the prior written approval by the Director of a plan of operation submitted by the domestic company with respect to each protected cell, establish one or more protected cells in connection with an insurance securitization. Upon the written approval by the Director of the plan of operation, which shall include, but not be limited to, the specific business and investment guidelines of the protected cell, the protected cell company may, in accordance with the approved plan of operation, attribute to the protected cell insurance obligations with respect to its insurance business and obligations relating to the insurance securitization and assets to fund those obligations. A protected cell shall have its own distinct name or designation, which shall include the words "protected cell". The protected cell company shall transfer all assets attributable to a protected cell to one or more separately established and identified protected cell accounts bearing the name or designation of that protected cell. Protected cell assets shall be held in the protected cell accounts for the purpose of satisfying the obligations of that protected cell.
    (b) All attributions of assets and liabilities between a protected cell and the general account shall be in accordance with the plan of operation approved by the Director. No other attribution of assets or liabilities may be made by a protected cell company between the protected cell company's general account and its protected cells. Any attribution of assets and liabilities between the general account and a protected cell or from investors in the form of principal on a debt instrument issued by a protected cell company shall be in cash or in readily marketable securities with established market values.
    (c) The creation of a protected cell does not create, in respect of that protected cell, a legal person separate from the protected cell company. Amounts attributed to a protected cell under this Article, including assets transferred to a protected cell account, are owned by the protected cell company and the protected cell company may not be, nor hold itself out to be, a trustee with respect to those protected cell assets of that protected cell account. Notwithstanding the foregoing, the company may allow for a security interest to attach to protected cell assets or a protected cell account when in favor of a creditor of the protected cell and otherwise allowed under applicable law.
    (d) This Article shall not be construed to prohibit the protected cell company from contracting with or arranging for an investment advisor, commodity trading advisor, or other third party to manage the protected cell assets of a protected cell, provided that all remuneration, expenses, and other compensation of the third party advisor or manager are payable from the protected cell assets of that protected cell and not from the protected cell assets of other protected cells or the assets of the protected cell company's general account.
    (e) A protected cell company shall establish administrative and accounting procedures necessary to properly identify the one or more protected cells of the protected cell company and the protected cell assets and protected cell liabilities attributable to the protected cells. It shall be the duty of the directors of a protected cell company to:
        (1) keep protected cell assets and protected cell
    
liabilities separate and separately identifiable from the assets and liabilities of the protected cell company's general account; and
        (2) keep protected cell assets and protected cell
    
liabilities attributable to one protected cell separate and separately identifiable from protected cell assets and protected cell liabilities attributable to other protected cells.
    If this Section is violated, the remedy of tracing shall be applicable to protected cell assets when commingled with protected cell assets of other protected cells or the assets of the protected cell company's general account. The remedy of tracing shall not be construed as an exclusive remedy.
    (f) The protected cell company shall, when establishing a protected cell, attribute to the protected cell assets with a value at least equal to the reserves and other insurance liabilities attributed to that protected cell.
(Source: P.A. 91-278, eff. 7-23-99; 92-74, eff. 7-12-01.)