Information maintained by the Legislative Reference Bureau
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INSURANCE
(215 ILCS 5/) Illinois Insurance Code.

215 ILCS 5/1017

    (215 ILCS 5/1017) (from Ch. 73, par. 1065.717)
    Sec. 1017. Service of Process - Insurance-Support Organizations. For the purpose of this Article, an insurance-support organization transacting business outside this State which has an effect on a person residing in this State shall be deemed to have appointed the Director to accept service of process on its behalf, provided the Director causes a copy of such service to be mailed forthwith by registered mail to the insurance-support organization at its last known principal place of business. The return postcard receipt for such mailing shall be sufficient proof that the same was properly mailed by the Director.
(Source: P.A. 81-1430.)

215 ILCS 5/1018

    (215 ILCS 5/1018) (from Ch. 73, par. 1065.718)
    Sec. 1018. Cease and Desist Orders and Reports. (A) If, after a hearing, the Director determines that the insurance institution, agent or insurance-support organization charged has engaged in conduct or practices in violation of this Article, he shall reduce his findings to writing and shall issue and cause to be served upon such insurance institution, agent or insurance-support organization a copy of such findings and an order requiring such insurance institution, agent or insurance-support organization to cease and desist from the conduct or practices constituting a violation of this Article.
    (B) If, after a hearing, the Director determines that the insurance institution, agent or insurance-support organization charged has not engaged in conduct or practices in violation of this Article, he shall prepare a written report which sets forth findings of fact and conclusions of law. Such report shall be served upon the insurance institution, agent or insurance-support organization charged and upon the person or persons, if any, whose rights under this Article were allegedly violated.
(Source: P.A. 81-1430.)

215 ILCS 5/1019

    (215 ILCS 5/1019) (from Ch. 73, par. 1065.719)
    Sec. 1019. Judicial Review. (1) Any order or decision made, issued or executed by the Director under this Article whereby any person or company is aggrieved is subject to review by the Circuit Court of Sangamon County.
    (2) The Administrative Review Law, as now or hereafter amended, and the rules adopted pursuant thereto, applies to and governs all proceedings for review of final administrative decisions of the Director provided for in this Section. The term "administrative decision" is defined as in Section 3-101 of the Code of Civil Procedure.
(Source: P.A. 82-783.)

215 ILCS 5/1020

    (215 ILCS 5/1020) (from Ch. 73, par. 1065.720)
    Sec. 1020. Penalties.
    (A) In any case where a hearing pursuant to Section 1016 results in the finding of a knowing violation of this Article, the Director may, in addition to the issuance of a cease and desist order as prescribed in Section 1018, order payment of a monetary penalty of not more than $1,000 for each violation but not to exceed $20,000 in the aggregate for multiple violations.
    (B) Any person who violates a cease and desist order of the Director under Section 1018 of this Article may, after notice and hearing and upon order of the Director, be subject to one or more of the following penalties, at the discretion of the Director:
        (1) a monetary fine of not more than $20,000 for each
    
violation,
        (2) a monetary fine of not more than $100,000 if the
    
Director finds that violations have occurred with such frequency as to constitute a general business practice, or
        (3) suspension or revocation of an insurance
    
institution's or agent's license.
(Source: P.A. 93-32, eff. 7-1-03.)

215 ILCS 5/1021

    (215 ILCS 5/1021) (from Ch. 73, par. 1065.721)
    Sec. 1021. Individual Remedies. (A) If any insurance institution, agent or insurance-support organization fails to comply with Sections 1009, 1010 or 1011 of this Article with respect to the rights granted under those Sections, any person whose rights are violated may apply to the circuit court of this State, or any other court of competent jurisdiction, for appropriate equitable relief.
    (B) An insurance institution, agent or insurance-support organization which discloses information in violation of Section 1014 of this Article shall be liable for damages sustained by the individual about whom the information relates; provided, however, that no individual shall be entitled to a monetary award which exceeds the actual damages sustained by the individual as a result of a violation of Section 1014 of this Article.
    (C) In any action brought pursuant to this Section, the court may award the cost of the action and reasonable attorney's fees to the prevailing party.
    (D) An action under this Section must be brought within 2 years from the date the alleged violation is or should have been discovered.
    (E) Except as specifically provided in this Section, there shall be no remedy or recovery available to individuals, in law or in equity, for occurrences constituting a violation of any provision of this Article.
(Source: P.A. 82-108.)

215 ILCS 5/1022

    (215 ILCS 5/1022) (from Ch. 73, par. 1065.722)
    Sec. 1022. Immunity. No cause of action in the nature of defamation, invasion of privacy or negligence shall arise against any person for disclosing personal or privileged information in accordance with this Article, nor shall such a cause of action arise against any person for furnishing personal or privileged information to an insurance institution, agent or insurance-support organization; provided, however, this Section shall provide no immunity for disclosing or furnishing false information with malice or willful intent to injure any person.
(Source: P.A. 82-108.)

215 ILCS 5/1023

    (215 ILCS 5/1023) (from Ch. 73, par. 1065.723)
    Sec. 1023. Obtaining Information Under False Pretenses. Any person who knowingly and willfully obtains information about an individual from an insurance institution, agent or insurance-support organization under false pretenses shall be guilty of a Class 4 felony.
(Source: P.A. 81-1430.)

215 ILCS 5/1023.5

    (215 ILCS 5/1023.5)
    Sec. 1023.5. Federal privacy protections.
    (A) In addition to the requirements of this Article, licensees shall comply with the privacy protection provisions of Title V of the federal Gramm-Leach-Bliley Act (Public Law 106-102, 106th Congress).
    (B) The Director shall have authority to enforce the requirements of the privacy protection provisions of Title V of the federal Gramm-Leach-Bliley Act, employing powers granted to him under this Article and this Code.
    (C) The Director shall make reasonable rules as may be necessary to make effective the privacy provisions of Title V of the federal Gramm-Leach-Bliley Act (Public Law 106-102, 106th Congress).
    (D) For purposes of this Section, "licensee" means all insurers, insurance producers, and other persons licensed or required to be licensed, authorized or required to be authorized, registered or required to be registered, or domiciled, pursuant to this Code or any other insurance law of this State administered by the Department. "Licensee" also includes unauthorized insurers who accept business placed through a licensed surplus line producer in this State, but only in regard to the surplus line placements placed pursuant to Section 445 of this Code. However, this Section does not apply to "service contract providers" as defined by the Service Contract Act.
(Source: P.A. 92-556, eff. 6-24-02.)

215 ILCS 5/1024

    (215 ILCS 5/1024) (from Ch. 73, par. 1065.724)
    Sec. 1024. This Article takes effect on July 1, 1981. The rights granted under Sections 1009, 1010 and 1014 of this Article shall take effect on July 1, 1981, regardless of the date of the collection or receipt of the information which is the subject of such Sections.
(Source: P.A. 81-1430.)

215 ILCS 5/Art. XLI

 
    (215 ILCS 5/Art. XLI heading)
ARTICLE XLI. RISK RETENTION ARRANGEMENTS FOR
BANKING ASSOCIATIONS

215 ILCS 5/1101

    (215 ILCS 5/1101) (from Ch. 73, par. 1065.801)
    Sec. 1101. Scope of Article. This Article applies only to trusts sponsored by domestic banking associations and organized under this Article to provide casualty insurance authorized under Section 5 of the Illinois Banking Act, as now or hereafter amended, for association member banks.
(Source: P.A. 84-1431.)

215 ILCS 5/1102

    (215 ILCS 5/1102) (from Ch. 73, par. 1065.802)
    Sec. 1102. Definitions. As used in this Article, the following terms have the following meanings:
    (1) "Banking association" means any Illinois corporation, whether for-profit or not-for-profit, which functions as a professional or trade association of dues-paying member commercial banks. For purposes of this Article, "banking association" does not include any corporation which directly or indirectly (a) accepts deposits which the depositor has a right to withdraw on demand by check or negotiable order, or (b) engages in the business of making loans, or both.
    (2) "Trust sponsor" means a banking association which has created a risk retention trust under this Article.
    (3) "Pool retention fund" means a separate fund maintained for payment of first dollar claims, up to a specific amount per claim ("specific retention") and up to an aggregate amount for a 12-month period ("aggregate retention").
    (4) "Contingency reserve fund" means a separate fund maintained for payment of claims in excess of the pool retention fund amount.
    (5) "Coverage grant" means the document describing specific coverages and terms of coverage which are provided by a risk retention trust created under this Article.
    (6) "Licensed service company" means an entity licensed under Section 464a of the Illinois Insurance Code to perform claims adjusting, loss control and data processing.
(Source: P.A. 84-1431.)

215 ILCS 5/1103

    (215 ILCS 5/1103) (from Ch. 73, par. 1065.803)
    Sec. 1103. Name. The corporate name of any trust organized under this Article shall not be the same as or deceptively similar to the name of any domestic insurance company or of any foreign or alien insurance company authorized to transact business in this State.
(Source: P.A. 84-1431.)

215 ILCS 5/1104

    (215 ILCS 5/1104) (from Ch. 73, par. 1065.804)
    Sec. 1104. Principal Office and Place of Business. The principal office of any trust organized under this Article shall be located in this State.
(Source: P.A. 84-1431.)

215 ILCS 5/1105

    (215 ILCS 5/1105) (from Ch. 73, par. 1065.805)
    Sec. 1105. Risk Retention Trust. (1) Any banking association which has been in existence for a period of not less than 2 years may create a risk retention trust for the pooling of risks in order to provide casualty coverage authorized under Section 5 of the Illinois Banking Act, as now or hereafter amended, for its member banks. Such trust shall be administered by at least 3 trustees who are appointed by the trust sponsor and who represent association member banks which have agreed in writing to participate in the trust.
    (2) The trustees shall appoint a qualified administrator who shall administer the affairs of the risk retention trust.
    (3) The trustees shall retain a licensed service company to perform claims adjusting, loss control and data processing.
    (4) The trust sponsor, the trustees and the trust administrator shall be fiduciaries of the trust.
    (5) Any trust created under this Article shall be consummated by a written trust agreement and shall be subject to the laws of this State governing the creation and operation of trusts, to the extent not inconsistent with this Article.
(Source: P.A. 84-1431.)

215 ILCS 5/1106

    (215 ILCS 5/1106) (from Ch. 73, par. 1065.806)
    Sec. 1106. Trust - Participation. (1) A banking association and its member banks may participate in any trust created under this Article if it:
    (a) Meets the underwriting standards for acceptance into the trust;
    (b) Files a written application for coverage, agreeing to meet all of the membership conditions of the trust;
    (c) Is a member of the association sponsoring the trust;
    (d) Agrees to meet the ongoing loss control provisions and risk pooling arrangements set forth by the trustees;
    (e) Pays its premium contribution on a timely basis as required; and
    (f) Pays its predetermined annual required contribution into the contingency reserve fund.
    (2) Any bank accepted for trust membership and participating in the trust under this Article shall be liable for payment to the trust of the amount of its annual premium contribution and its annual predetermined contingency reserve fund contribution.
(Source: P.A. 84-1431.)

215 ILCS 5/1107

    (215 ILCS 5/1107) (from Ch. 73, par. 1065.807)
    Sec. 1107. Trust - Coverage Grants - Payment of Claims. (1) No risk retention trust created under this Article may issue coverage grants until it has procured 100 bonafide applications for coverage with the first premium contribution in cash for each kind of coverage which the trust undertakes to write, and has a contingency reserve fund of at least $2,500,000. Every trust subject to this Article must have, and at all times maintain a pool retention fund at least equal to its unpaid liabilities and an unimpaired minimum contingency reserve fund of $1,500,000. The contingency reserve fund requirements shall be deemed satisfied if the required contribution into such fund by any participating member bank is obtained by a certificate of deposit redeemable by the trust in an amount not greater than the amount insured by the Federal Deposit Insurance Corporation.
    (2) Every coverage grant issued or delivered in this State by any trust subject to this Article shall provide for the liability of trust members to the extent that funds are needed to pay a member's share of the depleted contingency reserve fund needed to maintain the reserves required by this Section.
    (3) The Director may after notice and hearing suspend or revoke the license of any trust that fails to maintain the minimum reserves required by this Section.
    (4) All claims shall first be paid from the pool retention fund. If that fund becomes depleted, any additional claims shall be paid from the contingency reserve fund.
    (5) On the basis of an annual independent certified audit, the Director may require the risk retention trust to purchase insurance in amounts required to provide additional protection to member banks in excess of the contingency reserve fund.
(Source: P.A. 84-1431.)

215 ILCS 5/1108

    (215 ILCS 5/1108) (from Ch. 73, par. 1065.808)
    Sec. 1108. Trust; filing requirements; records.
    (1) Any risk retention trust created under this Article shall file with the Director:
        (a) A statement of intent to provide named coverages.
        (b) The trust agreement between the trust sponsor and
    
the trustees, detailing the organization and administration of the trust and fiduciary responsibilities.
        (c) Signed risk pooling agreements from each trust
    
member describing their intent to participate in the trust and maintain the contingency reserve fund.
        (d) By April 1 of each year a financial statement for
    
the preceding calendar year ending December 31, and a list of all beneficiaries during the year. The financial statement and report shall be in such form as the Director of Insurance may prescribe. The truth and accuracy of the financial statement shall be attested to by each trustee. Each Risk Retention Trust shall file with the Director by June 1 an opinion of an independent certified public accountant on the financial condition of the Risk Retention Trust for the most recent calendar year and the results of its operations, changes in financial position and changes in capital and surplus for the year then ended in conformity with accounting practices permitted or prescribed by the Illinois Department of Insurance.
        (e) The name of a bank or trust company with whom the
    
trust will enter into an escrow agreement which shall state that the contingency reserve fund will be maintained at the levels prescribed in this Article.
        (f) Copies of coverage grants it will issue.
    (2) The Director of Insurance shall charge, collect and give proper acquittances for the payment of the following fees and charges:
        (a) For filing trust instruments, amendments thereto
    
and financial statement and report of the trustees, $50.
        (b) For copies of papers or records per page, $2.
        (c) For certificate to copy of paper, $10.
        (d) For filing an application for the licensing of a
    
risk retention trust, $1,000.
    (3) The trust shall keep its books and records in accordance with the provisions of Section 133 of this Code. The Director may examine such books and records from time to time as provided in Sections 132 through 132.7 of this Code and may charge the expense of such examination to the trust as provided in subsection (3) of Section 408 of this Code.
    (4) Trust funds established under this Section and all persons interest therein or dealing therewith shall be subject to the provisions of Sections 133, 144.1, 149, 401, 401.1, 402, 403, 403A, 412, and all of the provisions of Articles VII, VIII, XII 1/2 and XIII of the Code, as amended. Except as otherwise provided in this Section, trust funds established under and which fully comply with this Section, shall not be subjected to any other provision of the Code.
    (5) The Director of Insurance may make reasonable rules and regulations pertaining to the standards of coverage and administration of the trust authorized by this Section. Such rules may include but need not be limited to reasonable standards for fiduciary duties of the trustees, standards for the investment of funds, limitation of risks assumed, minimum size, capital, surplus, reserves, and contingency reserves.
(Source: P.A. 93-32, eff. 7-1-03.)

215 ILCS 5/1109

    (215 ILCS 5/1109) (from Ch. 73, par. 1065.809)
    Sec. 1109. Illinois Insurance Guaranty Fund - Inapplicability. The provisions of Article XXXIV of this Code shall not apply to any risk retention trust created under this Article.
(Source: P.A. 84-1431.)

215 ILCS 5/Art. XLII

 
    (215 ILCS 5/Art. XLII heading)
ARTICLE XLII.
INSURANCE COST CONTAINMENT

215 ILCS 5/1200

    (215 ILCS 5/1200) (from Ch. 73, par. 1065.900)
    Sec. 1200. This Article shall be known and may be cited as the "Illinois Insurance Cost Containment Act".
(Source: P.A. 84-1431.)

215 ILCS 5/1201

    (215 ILCS 5/1201) (from Ch. 73, par. 1065.901)
    Sec. 1201. Purpose of Article. The purpose of this Article is to promote the public welfare by studying the relationship of insurance premium and related income as compared to insurance costs and expenses. The General Assembly finds and declares that stabilizing the cost of insurance is a vital concern to the people of this State.
    It is the legislative intent, pursuant to this declared public concern, to develop measures which will stabilize prices while continuing to provide quality insurance products to all sectors of the citizenry. It is the express intent of this Article to permit and encourage competition between companies on a sound financial basis to the fullest extent possible and to establish a mechanism to ensure the provision of adequate insurance at reasonable rates to the citizens of this State.
    The General Assembly finds that while the gathering of insurance cost data has been attempted on a voluntary basis in the past, the lack of a uniform system for the collection and analysis of data and the lack of full participation by insurers has led to inadequate and unusable data. In order to remedy this problem, the General Assembly find it necessary to create a mandated uniform system in Illinois for the collection, analysis and distribution of insurance cost data.
(Source: P.A. 84-1431.)

215 ILCS 5/1202

    (215 ILCS 5/1202) (from Ch. 73, par. 1065.902)
    Sec. 1202. Duties. The Director shall:
        (a) determine the relationship of insurance premiums
    
and related income as compared to insurance costs and expenses and provide such information to the General Assembly and the general public;
        (b) study the insurance system in the State of
    
Illinois, and recommend to the General Assembly what it deems to be the most appropriate and comprehensive cost containment system for the State;
        (c) respond to the requests by agencies of government
    
and the General Assembly for special studies and analysis of data collected pursuant to this Article. Such reports shall be made available in a form prescribed by the Director. The Director may also determine a fee to be charged to the requesting agency to cover the direct and indirect costs for producing such a report, and shall permit affected insurers the right to review the accuracy of the report before it is released. The fees shall be deposited into the Technology Management Revolving Fund and credited to the account of the Department of Insurance;
        (d) make an interim report to the General Assembly no
    
later than August 15, 1987, and an annual report to the General Assembly no later than July 1 every year thereafter which shall include the Director's findings and recommendations regarding its duties as provided under subsections (a), (b), and (c) of this Section.
(Source: P.A. 99-642, eff. 7-28-16; 100-23, eff. 7-6-17.)

215 ILCS 5/1203

    (215 ILCS 5/1203) (from Ch. 73, par. 1065.903)
    Sec. 1203. Powers and Additional Duties. (a) The Director may enter into any agreement with any corporation, association or other entity he or she deems appropriate to undertake the process described in this Article for the compilation and analysis of data collected by the Department and may conduct or contract for studies on insurance-related questions carried out in pursuance of the purposes of this Article. The agreement may provide for the corporation, association or entity to prepare and distribute or make available data to insurers, government and the general public.
    (b) The Director shall require, and the designated corporation, association or entity shall prepare, semi-annual basic reports in the aggregate on insurance cost trends in Illinois. The Director shall provide these reports to the General Assembly, and upon request, to the public.
    (c) Prior to the release or dissemination of these reports, the Director or the designated corporation, association or entity, shall permit insurers the opportunity to verify the accuracy of any information pertaining to the insurer. The insurer may submit to the Director any corrections or errors in the compilation of the data together with any supporting evidence and documents the insurer may provide.
(Source: P.A. 84-1431.)

215 ILCS 5/1204

    (215 ILCS 5/1204) (from Ch. 73, par. 1065.904)
    (Text of Section WITH the changes made by P.A. 94-677, which has been held unconstitutional)
    Sec. 1204. (A) The Secretary shall promulgate rules and regulations which shall require each insurer licensed to write property or casualty insurance in the State and each syndicate doing business on the Illinois Insurance Exchange to record and report its loss and expense experience and other data as may be necessary to assess the relationship of insurance premiums and related income as compared to insurance costs and expenses. The Secretary may designate one or more rate service organizations or advisory organizations to gather and compile such experience and data. The Secretary shall require each insurer licensed to write property or casualty insurance in this State and each syndicate doing business on the Illinois Insurance Exchange to submit a report, on a form furnished by the Secretary, showing its direct writings in this State and companywide.
    (B) Such report required by subsection (A) of this Section may include, but not be limited to, the following specific types of insurance written by such insurer:
        (1) Political subdivision liability insurance
    
reported separately in the following categories:
            (a) municipalities;
            (b) school districts;
            (c) other political subdivisions;
        (2) Public official liability insurance;
        (3) Dram shop liability insurance;
        (4) Day care center liability insurance;
        (5) Labor, fraternal or religious organizations
    
liability insurance;
        (6) Errors and omissions liability insurance;
        (7) Officers and directors liability insurance
    
reported separately as follows:
            (a) non-profit entities;
            (b) for-profit entities;
        (8) Products liability insurance;
        (9) Medical malpractice insurance;
        (10) Attorney malpractice insurance;
        (11) Architects and engineers malpractice insurance;
    
and
        (12) Motor vehicle insurance reported separately for
    
commercial and private passenger vehicles as follows:
            (a) motor vehicle physical damage insurance;
            (b) motor vehicle liability insurance.
    (C) Such report may include, but need not be limited to the following data, both specific to this State and companywide, in the aggregate or by type of insurance for the previous year on a calendar year basis:
        (1) Direct premiums written;
        (2) Direct premiums earned;
        (3) Number of policies;
        (4) Net investment income, using appropriate
    
estimates where necessary;
        (5) Losses paid;
        (6) Losses incurred;
        (7) Loss reserves:
            (a) Losses unpaid on reported claims;
            (b) Losses unpaid on incurred but not reported
        
claims;
        (8) Number of claims:
            (a) Paid claims;
            (b) Arising claims;
        (9) Loss adjustment expenses:
            (a) Allocated loss adjustment expenses;
            (b) Unallocated loss adjustment expenses;
        (10) Net underwriting gain or loss;
        (11) Net operation gain or loss, including net
    
investment income;
        (12) Any other information requested by the Secretary.
    (C-3) Additional information by an advisory organization as defined in Section 463 of this Code.
        (1) An advisory organization as defined in Section
    
463 of this Code shall report annually the following information in such format as may be prescribed by the Secretary:
            (a) paid and incurred losses for each of the past
        
10 years;
            (b) medical payments and medical charges, if
        
collected, for each of the past 10 years;
            (c) the following indemnity payment information:
        
cumulative payments by accident year by calendar year of development. This array will show payments made and frequency of claims in the following categories: medical only, permanent partial disability (PPD), permanent total disability (PTD), temporary total disability (TTD), and fatalities;
            (d) injuries by frequency and severity;
            (e) by class of employee.
        (2) The report filed with the Secretary of Financial
    
and Professional Regulation under paragraph (1) of this subsection (C-3) shall be made available, on an aggregate basis, to the General Assembly and to the general public. The identity of the petitioner, the respondent, the attorneys, and the insurers shall not be disclosed.
        (3) Reports required under this subsection (C-3)
    
shall be filed with the Secretary no later than September 1 in 2006 and no later than September 1 of each year thereafter.
    (C-5) Additional information required from medical malpractice insurers.
        (1) In addition to the other requirements of this
    
Section, the following information shall be included in the report required by subsection (A) of this Section in such form and under such terms and conditions as may be prescribed by the Secretary:
            (a) paid and incurred losses by county for each
        
of the past 10 policy years;
            (b) earned exposures by ISO code, policy type,
        
and policy year by county for each of the past 10 years; and
            (c) the following actuarial information:
                (i) Base class and territory equivalent
            
exposures by report year by relative accident year.
                (ii) Cumulative loss array by accident year
            
by calendar year of development. This array will show frequency of claims in the following categories: open, closed with indemnity (CWI), closed with expense (CWE), and closed no pay (CNP); paid severity in the following categories: indemnity and allocated loss adjustment expenses (ALAE) on closed claims; and indemnity and expense reserves on pending claims.
                (iii) Cumulative loss array by report year by
            
calendar year of development. This array will show frequency of claims in the following categories: open, closed with indemnity (CWI), closed with expense (CWE), and closed no pay (CNP); paid severity in the following categories: indemnity and allocated loss adjustment expenses (ALAE) on closed claims; and indemnity and expense reserves on pending claims.
                (iv) Maturity year and tail factors.
                (v) Any expense, contingency ddr (death,
            
disability, and retirement), commission, tax, and/or off-balance factors.
        (2) The following information must also be annually
    
provided to the Department:
            (a) copies of the company's reserve and surplus
        
studies; and
            (b) consulting actuarial report and data
        
supporting the company's rate filing.
        (3) All information collected by the Secretary under
    
paragraphs (1) and (2) shall be made available, on a company-by-company basis, to the General Assembly and the general public. This provision shall supersede any other provision of State law that may otherwise protect such information from public disclosure as confidential.
    (D) In addition to the information which may be requested under subsection (C), the Secretary may also request on a companywide, aggregate basis, Federal Income Tax recoverable, net realized capital gain or loss, net unrealized capital gain or loss, and all other expenses not requested in subsection (C) above.
    (E) Violations - Suspensions - Revocations.
        (1) Any company or person subject to this Article,
    
who willfully or repeatedly fails to observe or who otherwise violates any of the provisions of this Article or any rule or regulation promulgated by the Secretary under authority of this Article or any final order of the Secretary entered under the authority of this Article shall by civil penalty forfeit to the State of Illinois a sum not to exceed $2,000. Each day during which a violation occurs constitutes a separate offense.
        (2) No forfeiture liability under paragraph (1) of
    
this subsection may attach unless a written notice of apparent liability has been issued by the Secretary and received by the respondent, or the Secretary sends written notice of apparent liability by registered or certified mail, return receipt requested, to the last known address of the respondent. Any respondent so notified must be granted an opportunity to request a hearing within 10 days from receipt of notice, or to show in writing, why he should not be held liable. A notice issued under this Section must set forth the date, facts and nature of the act or omission with which the respondent is charged and must specifically identify the particular provision of this Article, rule, regulation or order of which a violation is charged.
        (3) No forfeiture liability under paragraph (1) of
    
this subsection may attach for any violation occurring more than 2 years prior to the date of issuance of the notice of apparent liability and in no event may the total civil penalty forfeiture imposed for the acts or omissions set forth in any one notice of apparent liability exceed $100,000.
        (4) All administrative hearings conducted pursuant to
    
this Article are subject to 50 Ill. Adm. Code 2402 and all administrative hearings are subject to the Administrative Review Law.
        (5) The civil penalty forfeitures provided for in
    
this Section are payable to the General Revenue Fund of the State of Illinois, and may be recovered in a civil suit in the name of the State of Illinois brought in the Circuit Court in Sangamon County or in the Circuit Court of the county where the respondent is domiciled or has its principal operating office.
        (6) In any case where the Secretary issues a notice
    
of apparent liability looking toward the imposition of a civil penalty forfeiture under this Section that fact may not be used in any other proceeding before the Secretary to the prejudice of the respondent to whom the notice was issued, unless (a) the civil penalty forfeiture has been paid, or (b) a court has ordered payment of the civil penalty forfeiture and that order has become final.
        (7) When any person or company has a license or
    
certificate of authority under this Code and knowingly fails or refuses to comply with a lawful order of the Secretary requiring compliance with this Article, entered after notice and hearing, within the period of time specified in the order, the Secretary may, in addition to any other penalty or authority provided, revoke or refuse to renew the license or certificate of authority of such person or company, or may suspend the license or certificate of authority of such person or company until compliance with such order has been obtained.
        (8) When any person or company has a license or
    
certificate of authority under this Code and knowingly fails or refuses to comply with any provisions of this Article, the Secretary may, after notice and hearing, in addition to any other penalty provided, revoke or refuse to renew the license or certificate of authority of such person or company, or may suspend the license or certificate of authority of such person or company, until compliance with such provision of this Article has been obtained.
        (9) No suspension or revocation under this Section
    
may become effective until 5 days from the date that the notice of suspension or revocation has been personally delivered or delivered by registered or certified mail to the company or person. A suspension or revocation under this Section is stayed upon the filing, by the company or person, of a petition for judicial review under the Administrative Review Law.
(Source: P.A. 94-277, eff. 7-20-05; 94-677, eff. 8-25-05; 95-331, eff. 8-21-07.)
 
    (Text of Section WITHOUT the changes made by P.A. 94-677, which has been held unconstitutional)
    Sec. 1204. (A) The Director shall promulgate rules and regulations which shall require each insurer licensed to write property or casualty insurance in the State and each syndicate doing business on the Illinois Insurance Exchange to record and report its loss and expense experience and other data as may be necessary to assess the relationship of insurance premiums and related income as compared to insurance costs and expenses. The Director may designate one or more rate service organizations or advisory organizations to gather and compile such experience and data. The Director shall require each insurer licensed to write property or casualty insurance in this State and each syndicate doing business on the Illinois Insurance Exchange to submit a report, on a form furnished by the Director, showing its direct writings in this State and companywide.
    (B) Such report required by subsection (A) of this Section may include, but not be limited to, the following specific types of insurance written by such insurer:
        (1) Political subdivision liability insurance
    
reported separately in the following categories:
            (a) municipalities;
            (b) school districts;
            (c) other political subdivisions;
        (2) Public official liability insurance;
        (3) Dram shop liability insurance;
        (4) Day care center liability insurance;
        (5) Labor, fraternal or religious organizations
    
liability insurance;
        (6) Errors and omissions liability insurance;
        (7) Officers and directors liability insurance
    
reported separately as follows:
            (a) non-profit entities;
            (b) for-profit entities;
        (8) Products liability insurance;
        (9) Medical malpractice insurance;
        (10) Attorney malpractice insurance;
        (11) Architects and engineers malpractice insurance;
    
and
        (12) Motor vehicle insurance reported separately for
    
commercial and private passenger vehicles as follows:
            (a) motor vehicle physical damage insurance;
            (b) motor vehicle liability insurance.
    (C) Such report may include, but need not be limited to the following data, both specific to this State and companywide, in the aggregate or by type of insurance for the previous year on a calendar year basis:
        (1) Direct premiums written;
        (2) Direct premiums earned;
        (3) Number of policies;
        (4) Net investment income, using appropriate
    
estimates where necessary;
        (5) Losses paid;
        (6) Losses incurred;
        (7) Loss reserves:
            (a) Losses unpaid on reported claims;
            (b) Losses unpaid on incurred but not reported
        
claims;
        (8) Number of claims:
            (a) Paid claims;
            (b) Arising claims;
        (9) Loss adjustment expenses:
            (a) Allocated loss adjustment expenses;
            (b) Unallocated loss adjustment expenses;
        (10) Net underwriting gain or loss;
        (11) Net operation gain or loss, including net
    
investment income;
        (12) Any other information requested by the Director.
    (C-3) Additional information by an advisory organization as defined in Section 463 of this Code.
        (1) An advisory organization as defined in Section
    
463 of this Code shall report annually the following information in such format as may be prescribed by the Secretary:
            (a) paid and incurred losses for each of the past
        
10 years;
            (b) medical payments and medical charges, if
        
collected, for each of the past 10 years;
            (c) the following indemnity payment information:
        
cumulative payments by accident year by calendar year of development. This array will show payments made and frequency of claims in the following categories: medical only, permanent partial disability (PPD), permanent total disability (PTD), temporary total disability (TTD), and fatalities;
            (d) injuries by frequency and severity;
            (e) by class of employee.
        (2) The report filed with the Secretary of Financial
    
and Professional Regulation under paragraph (1) of this subsection (C-3) shall be made available, on an aggregate basis, to the General Assembly and to the general public. The identity of the petitioner, the respondent, the attorneys, and the insurers shall not be disclosed.
        (3) Reports required under this subsection (C-3)
    
shall be filed with the Secretary no later than September 1 in 2006 and no later than September 1 of each year thereafter.
    (D) In addition to the information which may be requested under subsection (C), the Director may also request on a companywide, aggregate basis, Federal Income Tax recoverable, net realized capital gain or loss, net unrealized capital gain or loss, and all other expenses not requested in subsection (C) above.
    (E) Violations - Suspensions - Revocations.
        (1) Any company or person subject to this Article,
    
who willfully or repeatedly fails to observe or who otherwise violates any of the provisions of this Article or any rule or regulation promulgated by the Director under authority of this Article or any final order of the Director entered under the authority of this Article shall by civil penalty forfeit to the State of Illinois a sum not to exceed $2,000. Each day during which a violation occurs constitutes a separate offense.
        (2) No forfeiture liability under paragraph (1) of
    
this subsection may attach unless a written notice of apparent liability has been issued by the Director and received by the respondent, or the Director sends written notice of apparent liability by registered or certified mail, return receipt requested, to the last known address of the respondent. Any respondent so notified must be granted an opportunity to request a hearing within 10 days from receipt of notice, or to show in writing, why he should not be held liable. A notice issued under this Section must set forth the date, facts and nature of the act or omission with which the respondent is charged and must specifically identify the particular provision of this Article, rule, regulation or order of which a violation is charged.
        (3) No forfeiture liability under paragraph (1) of
    
this subsection may attach for any violation occurring more than 2 years prior to the date of issuance of the notice of apparent liability and in no event may the total civil penalty forfeiture imposed for the acts or omissions set forth in any one notice of apparent liability exceed $100,000.
        (4) All administrative hearings conducted pursuant to
    
this Article are subject to 50 Ill. Adm. Code 2402 and all administrative hearings are subject to the Administrative Review Law.
        (5) The civil penalty forfeitures provided for in
    
this Section are payable to the General Revenue Fund of the State of Illinois, and may be recovered in a civil suit in the name of the State of Illinois brought in the Circuit Court in Sangamon County or in the Circuit Court of the county where the respondent is domiciled or has its principal operating office.
        (6) In any case where the Director issues a notice of
    
apparent liability looking toward the imposition of a civil penalty forfeiture under this Section that fact may not be used in any other proceeding before the Director to the prejudice of the respondent to whom the notice was issued, unless (a) the civil penalty forfeiture has been paid, or (b) a court has ordered payment of the civil penalty forfeiture and that order has become final.
        (7) When any person or company has a license or
    
certificate of authority under this Code and knowingly fails or refuses to comply with a lawful order of the Director requiring compliance with this Article, entered after notice and hearing, within the period of time specified in the order, the Director may, in addition to any other penalty or authority provided, revoke or refuse to renew the license or certificate of authority of such person or company, or may suspend the license or certificate of authority of such person or company until compliance with such order has been obtained.
        (8) When any person or company has a license or
    
certificate of authority under this Code and knowingly fails or refuses to comply with any provisions of this Article, the Director may, after notice and hearing, in addition to any other penalty provided, revoke or refuse to renew the license or certificate of authority of such person or company, or may suspend the license or certificate of authority of such person or company, until compliance with such provision of this Article has been obtained.
        (9) No suspension or revocation under this Section
    
may become effective until 5 days from the date that the notice of suspension or revocation has been personally delivered or delivered by registered or certified mail to the company or person. A suspension or revocation under this Section is stayed upon the filing, by the company or person, of a petition for judicial review under the Administrative Review Law.
(Source: P.A. 94-277, eff. 7-20-05; 95-331, eff. 8-21-07.)

215 ILCS 5/1205

    (215 ILCS 5/1205) (from Ch. 73, par. 1065.905)
    Sec. 1205. Employees and Professional Consultants. The Department may employ and fix the compensation of such employees, and may enter into contractual agreements with technical and professional consultants as it deems necessary to expedite the purposes of this Article.
(Source: P.A. 84-1431.)

215 ILCS 5/1206

    (215 ILCS 5/1206) (from Ch. 73, par. 1065.906)
    Sec. 1206. Expenses. The companies required to file reports under this Article shall pay a reasonable fee established by the Director sufficient to cover the total cost of the Department incident to or associated with the administration and enforcement of this Article, including the collection, analysis and distribution of the insurance cost data, the conversion of hard copy reports to tape, and the compilation and analysis of basic reports. The Director may establish a schedule of fees for this purpose. Expenses for additional reports shall be billed to those requesting the reports. Any such fees collected under this Section shall be paid to the Director of Insurance and deposited into the Technology Management Revolving Fund and credited to the account of the Department of Insurance.
(Source: P.A. 100-23, eff. 7-6-17.)

215 ILCS 5/Art. XLIII

 
    (215 ILCS 5/Art. XLIII heading)
ARTICLE XLIII.
Mortgage Insurance Consolidation

215 ILCS 5/1300

    (215 ILCS 5/1300) (from Ch. 73, par. 1065.1000)
    Sec. 1300. Title. This Article may be cited as the Mortgage Insurance Consolidation Law.
(Source: P.A. 86-378.)

215 ILCS 5/1301

    (215 ILCS 5/1301) (from Ch. 73, par. 1065.1001)
    Sec. 1301. Purpose. The purpose of this Article is to protect the interests of Illinois insureds by:
    (1) establishing minimum standards and procedures for the effectuation of mortgage insurance consolidations;
    (2) establishing disclosure requirements specific to mortgage insurance consolidations and requiring insurers to make such disclosures on a timely basis;
    (3) clarifying the applicability of the unfair rate discrimination provisions of this Code to consolidations involved in loan transfers so as to prevent premium increases for consumers resulting from mandatory premium recalculation;
    (4) requiring that group mortgage life insurance certificates contain minimum standard provisions including conversion rights; and
    (5) preventing the arbitrary termination of mortgage insurance coverage in connection with consolidations.
(Source: P.A. 86-378.)

215 ILCS 5/1302

    (215 ILCS 5/1302) (from Ch. 73, par. 1065.1002)
    Sec. 1302. Scope. (a) This Article applies:
    (1) To all insurance companies authorized to transact the business of insurance in this State of the kind or kinds of business described in Class 1(a) and (b) and Class 2(a) of Section 4 of this Code except for the kind or kinds of business described in Article IX 1/2 of this Code.
    (2) To all mortgage insurance coverage offered, issued, or issued for delivery in this State, by mail or otherwise, in connection with consolidations regardless of whether the financial institution involved is located in or outside Illinois.
    (3) To all consolidations whether the old coverage is provided under an individual or group policy.
    (b) Except as otherwise specifically provided, it is not intended that this Article conflict with or supersede any other provisions of this Code, or any rules promulgated by the Department of Insurance implementing any such provisions.
(Source: P.A. 86-378.)

215 ILCS 5/1303

    (215 ILCS 5/1303) (from Ch. 73, par. 1065.1003)
    Sec. 1303. Definitions. The following definitions shall apply to this Article:
    "Consolidation" means any transaction in which a financial institution makes its premium collection services available to its mortgage debtors in connection with a particular insurer's ("new insurer") offer of mortgage insurance, which offer is made to debtors who, immediately prior to the offer, had mortgage insurance with another insurer ("old insurer") and were paying premiums for that insurance with their monthly mortgage payments.
    "Financial institution" or "servicer" means any entity or organization that services mortgage loans by collecting and accounting for monthly mortgage insurance premiums as part of the debtor's monthly mortgage payment for one or more insurers.
    "Insured" means the individual loan customer or certificate holder.
    "Loan transfer" means a transaction in which the servicing of a block of mortgage loans is transferred from one servicer to another servicer. This shall include, but not be limited to, mergers or acquisitions.
    "Loan transfer consolidation" means a consolidation in which coverage is limited to insureds whose mortgage loans have been sold or transferred in the secondary market from one servicer to another.
    "Group-to-group consolidation" means a consolidation in which coverages under both the old plan and the new plan is provided under group policies.
    "Mortgage insurance" means mortgage life insurance (term or ordinary), mortgage disability insurance, mortgage accidental death insurance, or any combination thereof, including both individual and group policies, and any certificates issued thereunder, on credit transactions of more than 10 years duration and written in connection with a credit transaction that is secured by a first mortgage or deed of trust and made to finance the purchase of real property or the construction of a dwelling thereon or to refinance a prior credit transaction made for such a purpose.
    "New coverage" or "new plan" means the mortgage insurance coverage or plan for which a financial institution collects premium beginning on the effective date of a consolidation.
    "New insurer" means any insurer who offers mortgage insurance coverage to borrowers of the financial institution who can no longer remit monthly premiums for the old insurer along with their monthly mortgage payment.
    "Old coverage" or "old plan" means the mortgage insurance coverage or plan for which a financial institution collects premiums immediately prior to a consolidation.
    "Old insurer" means any insurer for whom a financial institution will no longer make its premium collection facilities available for all or some of the insurer's policyholders or certificate holders.
(Source: P.A. 100-201, eff. 8-18-17.)

215 ILCS 5/1304

    (215 ILCS 5/1304) (from Ch. 73, par. 1065.1004)
    Sec. 1304. General requirements. Except as provided in Section 1305, no insurer shall participate in any consolidation unless, in addition to all other requirements provided by law, it complies with the following:
    (1) The new insurer must calculate premiums for the new coverage on the basis of its own rates, the prospective insured's then attained age, if applicable, and the amount of insurance offered.
    (2) Notice of the new premium shall be mailed, together with the offer of new coverage, to the prospective insured at least 30 days prior to the effective date of the new coverage.
    (3) The new coverage shall be put into effect only after the new insurer receives an application which has been signed by the prospective insured.
    (4) Whenever the existing coverage is provided under individual policies, the new insurer shall comply with the requirements of Part 917 of Title 50 of the Illinois Administrative Code, promulgated by the Department of Insurance.
    (5) All riders which are a part of the existing insurance shall be offered without proof of insurability to all policyholders (or certificate holders) obtained by consolidation, including, but not limited to, waiver of premium and accidental death insurance.
    (6) Prospective insureds shall be given the option to name the beneficiary of their choice by the new insurer, if the previous beneficiary is other than a financial institution.
    (7) Regulations including, but not limited to, those promulgated by the Department of Insurance implementing Sections 143, 149, 151, 236, 237, 421, 424 and 507.1 of this Code concerning misrepresentations to any policyholder for the purpose of inducing or tending to induce such policyholder to lapse, forfeit or surrender his insurance, unfair or deceptive practices, complaints, solicitation and replacement of life insurance, compensation, and rebating shall be complied with.
(Source: P.A. 86-378.)

215 ILCS 5/1305

    (215 ILCS 5/1305) (from Ch. 73, par. 1065.1005)
    Sec. 1305. Loan transfer consolidations. In a consolidation conducted as a result of a loan transfer, the offer of new coverage may be based on the same premium the insured was paying for his old coverage only if, in addition to all other requirements provided by law, the following conditions are met:
    (1) Both the old and the new coverage must be provided under a group policy.
    (2) An offer of new coverage must be made as soon as reasonably possible after the loan transfer. If an offer of new coverage is not made within 30 days after the loan transfer, or at least 30 days prior to the proposed effective date of the new coverage, the insurer shall notify the debtor, in writing, that he has the right to an unconditional refund of all premiums paid for the new coverage as long as he exercises that right, in writing, within 30 days from the date of the notification.
    (3) The new coverage offered to the prospective insured must be the same as the old coverage, including all supplemental benefits provided under the old plan. If the coverage offered is not the same, then all the requirements of Section 1304 shall apply.
    (4) In addition to the requirements of Section 1307, the certificate shall contain the following notice, printed in bold type on page one of the certificate:
IMPORTANT NOTICE
    This certificate is issued to you in connection with a mortgage insurance consolidation. It is the intention of the Company to provide you group coverage which is equal to or better than the group coverage you had before. To the extent the benefits provided or the provisions of your prior certificate of insurance are more liberal than those under this certificate, the provisions of your prior certificate will control. Therefore, you should keep your old certificate along with this certificate for comparison purposes.
    (5) The information contained in the notice prescribed by paragraph (4) shall also be disclosed in writing (separate from the certificate of insurance) to each prospective insured at the time the offer of new coverage is made.
    (6) Only the group coverage written in connection with the loans which are the subject of the loan transfer may be consolidated pursuant to this Section.
    (7) Payment of the required premium shall constitute acceptance of the new coverage if:
    (A) such acceptance mechanism is clearly explained to the debtor; and
    (B) All other disclosure requirements of this Article are met.
    (8) Regulations including, but not limited to, those promulgated by the Department of Insurance implementing Sections 143, 149, 151, 236, 237, 421, 424 and 507.1 of this Code concerning misrepresentations to any policyholder for the purpose of inducing or tending to induce such policyholder to lapse, forfeit or surrender his insurance, unfair or deceptive practices, complaints, solicitation and replacement of life insurance, compensation and rebating shall be complied with.
    (9) If an insurer charges debtor insureds the same premium for the new coverage that they were paying for the old coverage, and, as a result, debtor insureds of a financial institution are charged different premium rates for the same coverage, such rate differences shall not constitute unfair discrimination under Sections 236 and 364 of this Code provided all the other applicable requirements of this Code are met.
(Source: P.A. 86-378.)

215 ILCS 5/1306

    (215 ILCS 5/1306) (from Ch. 73, par. 1065.1006)
    Sec. 1306. Out-of-state consolidations. If Illinois residents whose loans are serviced outside Illinois are involved in a group-to-group consolidation by an out-of-state servicer, Section 1305 may be employed if the Illinois residents are an incidental part of the consolidation. Otherwise the provisions of this Article shall apply to any consolidation insofar as it involves Illinois residents. For purposes of this provision "incidental" shall mean that the Illinois residents comprise less than 25% or 100 lives of the total lives involved in the consolidation, whichever is less.
(Source: P.A. 86-378.)

215 ILCS 5/1307

    (215 ILCS 5/1307) (from Ch. 73, par. 1065.1007)
    Sec. 1307. Group certificates. No insurer may participate in a group-to-group consolidation or a loan transfer consolidation unless in addition to all other requirements provided by law, it complies with the following:
    (1) A group certificate must be delivered to each debtor insured under the new plan, which certificate shall include the following information:
    (A) the name or names of the single or joint insureds;
    (B) identification of the insured mortgage;
    (C) the amount of insurance under the new plan;
    (D) the premium for the new coverage;
    (E) the effective date of the new coverage;
    (F) the beneficiary for the new coverage.
    (2) The new coverage offered to the prospective insured must be the same coverage as the old coverage, including all supplemental benefits, or the same type of coverage as the old coverage, whichever is otherwise required by this Article.
    (3) A group certificate evidencing the new coverage may not include a contestability clause or, in the case of mortgage life insurance, a provision excluding suicide.
(Source: P.A. 86-378.)

215 ILCS 5/1308

    (215 ILCS 5/1308) (from Ch. 73, par. 1065.1008)
    Sec. 1308. Conversion privilege. Notwithstanding the provisions of Section 231.1(H) of this Code, all group mortgage life insurance policies and any certificates issued thereunder shall include a conversion privilege permitting a debtor insured to convert, without evidence of insurability, to an individual policy of decreasing term insurance within 30 days of the date the debtor insured's group coverage is terminated for any reason other than the nonpayment of premiums. The initial amount of coverage under the individual policy shall be an amount equal to the amount of coverage terminated under the group policy and shall decrease over a term that corresponds with the scheduled term of the insured debtor's mortgage loan. The premium for the individual policy shall be the same premium the debtor insured was paying under the group policy.
(Source: P.A. 86-378.)

215 ILCS 5/1309

    (215 ILCS 5/1309) (from Ch. 73, par. 1065.1009)
    Sec. 1309. Required disclosures. (a) In conjunction with the offer of new coverage involving any consolidation, the new insurer shall disclose in writing to each insured under the old plan or plans at least 30 days prior to the effective date of the new coverage the following:
    (1) Identification of the insured mortgage.
    (2) The name of the insured or insureds.
    (3) Name of the owner of the individual policy or master policy (if group insurance) under both the new and old plans, if known.
    (4) The premium for the new and old coverage.
    (5) Amount of coverage for both the new and old plans. If the amount of coverage for the old plan is not known, a statement that the amount may be scheduled and it may be less than or greater than the amount of the loan and the insured should check the policy schedule for an exact amount of coverage.
    (6) Effective dates of the old coverage if the contestable or suicide period have not expired as of the effective date of the new coverage. If the new insurer waives the contestable and suicide period, then the effective date of the old coverage does not need to be disclosed.
    (7) Name of the beneficiary under the old plan, if known.
    (8) A statement as to whether the old plan was an individual or group plan and a statement as to whether the new plan is an individual or a group plan.
    (9) A statement that neither the old plan or new plan is required.
    (10) A statement that the prospective insured may have the right to continue or convert his old coverage by paying premiums directly to the old insurer, and what the prospective insured must do to keep the old coverage in effect including, but not limited to, the name and address of the company involved, the policy number or other information which reasonably identifies the insured's plan of coverage, the amount of the premium and where it is to be sent.
    (11) A statement that the mortgage payment will be reduced by the amount of the old plan premium if the new plan is not accepted.
    (12) Name and home office address of the new and old insurer, as well as the address and phone number for the customer services office for Illinois insureds.
    (13) The effective date of the new coverage.
    (14) Whether premium rates under the new plan are guaranteed.
    (15) Material differences, if any between the new plan and the old plan.
    (b) Any insurer which fails to provide the written notice required by subsection (a) at least 30 days prior to the effective date of the new coverage shall notify the debtor, in writing, that he has the right to an unconditional refund of all premiums paid for the new coverage as long as he exercises that right, in writing, within 30 days from that notification.
(Source: P.A. 86-378.)

215 ILCS 5/1310

    (215 ILCS 5/1310) (from Ch. 73, par. 1065.1010)
    Sec. 1310. Compensation. No sponsorship fees, or other special fees designed to induce their participation, shall be paid to a financial institution in connection with any mortgage consolidation, and any compensation paid to either the financial institution or any of its representatives shall be only in accordance with Section 151 and all other applicable provisions of this Code.
(Source: P.A. 86-378.)

215 ILCS 5/1311

    (215 ILCS 5/1311) (from Ch. 73, par. 1065.1011)
    Sec. 1311. No group policy or group certificate of mortgage insurance used in connection with a consolidation, nor any application, endorsement or rider which becomes a part of any such group policy or certificate, may be issued or delivered in this State until a copy of the form has been filed with and approved by the Director.
(Source: P.A. 86-378.)

215 ILCS 5/1312

    (215 ILCS 5/1312) (from Ch. 73, par. 1065.1012)
    Sec. 1312. The Director is authorized to adopt such rules governing mortgage insurance consolidations as he deems necessary to implement or enforce this Article.
(Source: P.A. 86-378.)

215 ILCS 5/Art. XLIV

 
    (215 ILCS 5/Art. XLIV heading)
Article XLIV. FINANCIAL INSTITUTIONS
INSURANCE SALES LAW

215 ILCS 5/1400

    (215 ILCS 5/1400)
    Sec. 1400. Title. This Article may be cited as the Financial Institutions Insurance Sales Law.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1401

    (215 ILCS 5/1401)
    Sec. 1401. Purpose. The purpose of this Article is to increase the availability of insurance products to the citizens of this State by expanding those businesses authorized to sell insurance products to include financial institutions, and to protect the interests of the citizens of this State by regulating their authority to do so. This Article does not apply to activities or services conducted in this State by or for a financial institution that do not require licensure as an insurance producer, temporary insurance producer, limited insurance representative, or registered firm.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1402

    (215 ILCS 5/1402)
    Sec. 1402. Definitions. For the purposes of this Article:
    "Financial institution" means:
        (1) a State bank, a national bank, or an out-of-state
    
bank, as those terms are defined in the Illinois Banking Act, or any subsidiary of a State bank, a national bank, or an out-of-state bank;
        (2) a foreign banking corporation, as that term is
    
defined in the Foreign Banking Office Act, or any subsidiary of a foreign banking corporation;
        (3) a corporate fiduciary, as that term is defined in
    
the Corporate Fiduciary Act;
        (4) a savings bank organized under the Savings Bank
    
Act, an out-of-state savings bank chartered under the laws of a state other than Illinois, a territory of the United States, or the District of Columbia, or a federal savings bank organized under federal law, or any subsidiary of a savings bank, an out-of-state savings bank or a federal savings bank;
        (5) an association or federal association, as those
    
terms are defined in the Illinois Savings and Loan Act of 1985, or any subsidiary of an association or federal association;
        (6) an out-of-state savings and loan association
    
chartered under the laws of a state other than Illinois, a territory of the United States or the District of Columbia, or a federal savings and loan association organized under federal law whose principal business office is located outside of Illinois, or any subsidiary of an out-of-state savings and loan association or federal savings and loan association whose principal business office is located outside of Illinois; or
        (7) a credit union as defined in the Illinois Credit
    
Union Act, or any subsidiary of a credit union.
    To the extent that any entity other than a financial institution conducts insurance activities in this State on behalf of or on the premises of the financial institution, such entity shall be subject to this Article for the purposes of those activities.
    "Insurance" means all lines of insurance defined and regulated as insurance under this Code, but for the purposes of this Article, "insurance" shall not include the following lines of insurance, provided that this paragraph shall not be deemed to preclude or otherwise limit regulation of the following lines of insurance pursuant to and to the extent otherwise provided by any other insurance law of this State:
        (1) credit life, credit accident and health, credit
    
involuntary unemployment, credit casualty and credit property insurance;
        (2) extended service contracts and warranty
    
agreements;
        (3) insurance obtained by the debtor to provide
    
payment for the difference between the remaining balance on a loan or other extension of credit and the amount of insurance coverage on the collateral securing the loan or other extension of credit;
        (4) insurance placed by a financial institution on
    
collateral used in connection with a loan or other extension of credit when a debtor breaches the contractual obligation to provide that insurance;
        (5) title insurance regulated by the Title Insurance
    
Act; and
        (6) private mortgage insurance and financial
    
guarantee insurance.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1403

    (215 ILCS 5/1403)
    Sec. 1403. Licensure requirements for financial institutions.
    (a) A financial institution transacting insurance business in this State shall register with the Director pursuant to the Illinois Insurance Code and shall be subject to the laws, rules, and penalties of the Illinois Insurance Code.
    (b) The solicitation and sale of insurance by a financial institution shall be conducted only by individuals who have been issued and maintain an insurance producer's license pursuant to the Illinois Insurance Code and shall be subject to the laws, rules, and penalties of the Illinois Insurance Code.
    (c) For the purposes of this Section, a "financial institution" means the subsidiary of a financial institution when the financial institution is transacting insurance business in this State only through the subsidiary. For the purposes of Section 499.1 of the Illinois Insurance Code, a financial institution shall be deemed to be a corporation.
    (d) Nothing in Section 500-100 of this Code shall be construed to require a limited lines producer license or any other form or class of producer's license for financial institutions, or their employees, if the financial institution has purchased or sponsored a group credit life, credit accident and health, credit casualty, credit property, or other group credit insurance policy or program under which the financial institution enrolls or performs other administrative services, or both, to enable individuals to purchase insurance coverage under the group credit insurance policy sold by a licensed producer in compliance with Section 155.56. A financial institution that performs enrollment or other administrative services, or both, with respect to its group credit insurance policies or programs shall be deemed to be in compliance with paragraph (2) of subsection (b) of Section 500-20 of this Code.
(Source: P.A. 100-349, eff. 8-25-17.)

215 ILCS 5/1404

    (215 ILCS 5/1404)
    Sec. 1404. Subsidiaries or divisions. A financial institution shall not qualify for registration as a registered firm under Section 499.1 of this Code unless: (1) it establishes a separate subsidiary that acts as the registered firm or (2) it is otherwise permitted by law to sell insurance directly through the financial institution, and it establishes a separate division within the financial institution to conduct the business of the registered firm. The subsidiary or division acting as a registered firm shall maintain records for insurance transactions that are separate and distinct from the records of the financial institution.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1405

    (215 ILCS 5/1405)
    Sec. 1405. Extensions of credit. A financial institution shall not delay or impede the completion of a loan transaction or other transactions involving the extension of credit for the purpose of influencing a customer's selection of any insurance product.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1406

    (215 ILCS 5/1406)
    Sec. 1406. Insurance and financial institution products.
    (a) No financial institution may offer banking products or services, or fix or vary the consideration of the offer, on a condition or requirement that the customer obtain insurance from the financial institution or any affiliate of the financial institution.
    (b) A financial institution that offers banking products or services in conformity with the provisions of Section 106 of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972) shall be deemed to be in compliance with the provisions of subsection (a) of this Section.
    (c) No financial institution shall require that a customer or prospective customer of the financial institution purchase an insurance product from any particular registered firm or insurance producer as a condition for the lending of money or extension of credit, the establishment or maintenance of a checking, savings, or other deposit account, or the establishment or maintenance of a trust account.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1407

    (215 ILCS 5/1407)
    Sec. 1407. Rebating and discounting.
    (a) No financial institution may offer a rebate on an insurance product in violation of Section 151 of this Code.
    (b) No financial institution may offer a discount on a loan or extension of credit for the purpose of inducing the customer to purchase insurance required in connection with the loan or extension of credit.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1408

    (215 ILCS 5/1408)
    Sec. 1408. Discrimination prohibited. No financial institution may:
    (1) require as a condition of providing any product or service or renewal of any contract for providing a product or service to any customer, that the customer acquire, finance, or negotiate any policy or contract of insurance through a particular insurer, insurance producer, or registered firm;
    (2) in connection with a loan or extension of credit that requires a borrower to obtain insurance, reject an insurance policy solely because the policy has been issued or underwritten by any person who is not associated with the financial institution;
    (3) impose any discriminatory requirement on any insurance producer who is not associated with the financial institution that is not imposed on any insurance producer who is associated with the financial institution; or
    (4) if the financial institution is a registered firm, require any debtor, insurer, or insurance producer to pay a separate charge in connection with the handling of insurance that is required under a contract, unless: (i) the financial institution is the registered firm providing the insurance, (ii) if the financial institution is not the registered firm providing the insurance, the charge would be uniformly applied if the financial institution was the registered firm providing the insurance, or (iii) the charge is otherwise permitted by this Code or other applicable State or federal law.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1409

    (215 ILCS 5/1409)
    Sec. 1409. Disclosure. A financial institution shall clearly and conspicuously disclose in any written advertisement or promotional or informational material regarding an insurance product that the insurance offered, recommended, sponsored, or sold:
    (1) is not a deposit;
    (2) is not insured by the Federal Deposit Insurance Corporation, or in the case of a credit union, by the National Credit Union Share Insurance Fund;
    (3) is not guaranteed by the financial institution or an affiliated insured depository institution; and
    (4) where appropriate, involves investment risk, including potential loss of principal.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1410

    (215 ILCS 5/1410)
    Sec. 1410. Misleading advertising. No financial institution or registered firm may employ any advertisement that would mislead or otherwise cause a reasonable person to believe mistakenly that the State of Illinois or the federal government is responsible for the insurance sales activities of the financial institution or stands behind the financial institution's credit, or that the financial institution, the State of Illinois, or the federal government guarantees any returns on insurance products or is a source of payment of any insurance obligation of or sold by the financial institution.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1411

    (215 ILCS 5/1411)
    Sec. 1411. Commissions and compensation. No financial institution shall pay, directly or indirectly, any commission, service fee, brokerage, or other valuable consideration to any person for services as an insurance producer, temporary insurance producer, or limited insurance representative, or for such services by the person's members, officers, directors or employees, unless the person, and any member, officer, director, or employee performing the service, held a valid license regarding the class of insurance as to which the service was rendered, or unless the person was a properly registered firm at the time the service was performed. No person, other than a person properly licensed or registered in accordance with Article XXXI of this Code at the time the person performs services as an insurance producer, temporary insurance producer, or limited insurance representative, shall accept any commission, service fee, brokerage, or other valuable consideration for such services. This Section shall not prevent payment or receipt of:
    (1) renewal or other deferred commissions to or by any person entitled thereto under this Section;
    (2) fees to or by a financial institution or any other person for services that do not require licensure as an insurance producer, temporary insurance producer, limited insurance representative, or registered firm; or
    (3) consideration paid to a financial institution by a registered firm, insurance producer, insurance company, or any other person pursuant to any lease agreement.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1412

    (215 ILCS 5/1412)
    Sec. 1412. Solicitations to loan applicants.
    (a) A financial institution that requires a customer to obtain insurance in connection with a loan or extension of credit and that offers that insurance either directly or through an affiliate shall clearly disclose to the customer in writing at the time of written application or at closing if no written application is obtained in a form substantially similar to the following:
        "You may obtain insurance required in connection with
    
your loan or extension of credit from any insurance agent, broker, or firm that sells such insurance. Your choice of insurance provider will not affect our credit decision or your credit terms.".
    (b) This Section shall not apply when a financial institution is contacting a customer in the course of direct or mass marketing to a group of persons in a manner that bears no relation to the customer's loan application or credit decision.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1413

    (215 ILCS 5/1413)
    Sec. 1413. Separate physical location and sales force when insurance is solicited or sold in connection with a loan.
    (a) An employee of a financial institution may not solicit or sell insurance at the same desk where a loan transaction is conducted when the insurance is solicited or sold in connection with the same loan.
    (b) A loan officer of a financial institution who is involved in the application, solicitation, or closing of a loan transaction may not solicit or sell insurance in connection with the same loan, but such loan officer may refer the loan customer to another insurance producer who is not involved in the application, solicitation, or closing of the same loan transaction.
    (c) Subsections (a) and (b) of this Section shall not apply to a financial institution, other than a credit union, or a branch location of a financial institution, other than a credit union, that has less than $100,000,000 in deposits.
    (d) Subsections (a) and (b) of this Section shall not apply to a credit union or a branch location of a credit union that has less than $30,000,000 in deposits.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1414

    (215 ILCS 5/1414)
    Sec. 1414. Signage. Signs concerning the availability of insurance products offered by the financial institution or by any registered firm shall be clearly displayed in the same area where applications for loans or other extensions of credit are being taken or closed and shall include the disclosure set forth in subsection (a) of Section 1412.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1415

    (215 ILCS 5/1415)
    Sec. 1415. Confidential customer information.
    (a) A financial institution that is a registered firm may not release a customer's insurance information to any person other than an officer, director, employee, agent, or affiliate of the financial institution without the written consent of the customer. For the purposes of this Section, "insurance information" means information concerning the premiums, terms and conditions of insurance coverage, insurance claims, and the insurance history of a customer contained in the financial institution's records.
    (b) Subsection (a) of this Section shall not apply to:
        (1) names, addresses, and telephone numbers derived
    
in any manner from the financial institution's records, or
        (2) the release of insurance information as otherwise
    
authorized by State or federal law.
    (c) A financial institution shall not require premium information when requiring evidence of insurance in connection with a loan or extension of credit and shall not use such premium information for the purpose of soliciting insurance without the written consent of the customer.
    (d) A financial institution may not use health information obtained from a customer's insurance records for any purpose other than for its activities as a registered firm pursuant to this Code.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/1416

    (215 ILCS 5/1416)
    Sec. 1416. Prohibited defenses. A violation of any provision of this Article shall not be used as a defense by any person in any action by a financial institution to recover the amount owing on any loan or extension of credit.
(Source: P.A. 90-41, eff. 10-1-97.)

215 ILCS 5/Art. XLV

 
    (215 ILCS 5/Art. XLV heading)
ARTICLE XLV. PUBLIC ADJUSTERS

(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1501

    (215 ILCS 5/1501)
    Sec. 1501. Short title. This Article may be cited as the Public Adjusters Law.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1505

    (215 ILCS 5/1505)
    Sec. 1505. Purpose and scope. This Article governs the qualifications and procedures for the licensing of public adjusters. It specifies the duties of and restrictions on public adjusters, which include limiting their licensure to assisting insureds in first party claims.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1510

    (215 ILCS 5/1510)
    Sec. 1510. Definitions. In this Article:
    "Adjusting a claim for loss or damage covered by an insurance contract" means negotiating values, damages, or depreciation or applying the loss circumstances to insurance policy provisions.
    "Business entity" means a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity.
    "Department" means the Department of Insurance.
    "Director" means the Director of Insurance.
    "Fingerprints" means an impression of the lines on the finger taken for the purpose of identification. The impression may be electronic or in ink converted to electronic format.
    "Home state" means the District of Columbia and any state or territory of the United States where the public adjuster's principal place of residence or principal place of business is located. If neither the state in which the public adjuster maintains the principal place of residence nor the state in which the public adjuster maintains the principal place of business has a substantially similar law governing public adjusters, the public adjuster may declare another state in which it becomes licensed and acts as a public adjuster to be the home state.
    "Individual" means a natural person.
    "Person" means an individual or a business entity.
    "Public adjuster" means any person who, for compensation or any other thing of value on behalf of the insured:
        (i) acts or aids, solely in relation to first party
    
claims arising under insurance contracts that insure the real or personal property of the insured, on behalf of an insured in adjusting a claim for loss or damage covered by an insurance contract;
        (ii) advertises for employment as a public adjuster
    
of insurance claims or solicits business or represents himself or herself to the public as a public adjuster of first party insurance claims for losses or damages arising out of policies of insurance that insure real or personal property; or
        (iii) directly or indirectly solicits business,
    
investigates or adjusts losses, or advises an insured about first party claims for losses or damages arising out of policies of insurance that insure real or personal property for another person engaged in the business of adjusting losses or damages covered by an insurance policy for the insured.
    "Uniform individual application" means the current version of the National Association of Directors (NAIC) Uniform Individual Application for resident and nonresident individuals.
    "Uniform business entity application" means the current version of the National Association of Insurance Commissioners (NAIC) Uniform Business Entity Application for resident and nonresident business entities.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1515

    (215 ILCS 5/1515)
    Sec. 1515. License required.
    (a) A person shall not act, advertise, solicit, or hold himself out as a public adjuster or to be in the business of adjusting insurance claims in this State, nor attempt to obtain a contract for public adjusting services, unless the person is licensed as a public adjuster in accordance with this Article.
    (b) A person licensed as a public adjuster shall not misrepresent to a claimant that he or she is an adjuster representing an insurer in any capacity, including acting as an employee of the insurer or acting as an independent adjuster unless so appointed by an insurer in writing to act on the insurer's behalf for that specific claim or purpose. A licensed public adjuster is prohibited from charging that specific claimant a fee when appointed by the insurer and the appointment is accepted by the public adjuster.
    (c) A business entity acting as a public adjuster is required to obtain a public adjuster license. Application shall be made using the Uniform Business Entity Application. Before approving the application, the Director shall find that:
        (1) the business entity has paid the required fees
    
to be registered as a business entity in this State; and
        (2) all officers, shareholders, and persons with
    
ownership interests in the business entity are licensed public adjusters responsible for the business entity's compliance with the insurance laws, rules, and regulations of this State.
    (d) Notwithstanding subsections (a) through (c) of this Section, a license as a public adjuster shall not be required of the following:
        (1) an attorney admitted to practice in this State,
    
when acting in his or her professional capacity as an attorney;
        (2) a person who negotiates or settles claims arising
    
under a life or health insurance policy or an annuity contract;
        (3) a person employed only for the purpose of
    
obtaining facts surrounding a loss or furnishing technical assistance to a licensed public adjuster, including photographers, estimators, private investigators, engineers, and handwriting experts;
        (4) a licensed health care provider, or employee of a
    
licensed health care provider, who prepares or files a health claim form on behalf of a patient; or
        (5) a person who settles subrogation claims between
    
insurers.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1520

    (215 ILCS 5/1520)
    Sec. 1520. Application for license.
    (a) A person applying for a public adjuster license shall make application to the Director on the appropriate uniform application or other application prescribed by the Director.
    (b) The applicant shall declare under penalty of perjury and under penalty of refusal, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of the applicant's knowledge and belief.
    (c) In order to make a determination of license eligibility, the Director is authorized to require all applicants for licensing, including renewal applicants, to undergo a fingerprint-based criminal history record check for the first year following the effective date of this amendatory Act of the 97th General Assembly. The fingerprints and the fee required to perform the criminal history record checks shall be submitted to the Department of State Police and the Federal Bureau of Investigation (FBI) to conduct a State and national criminal history record check. The Department of State Police and the Federal Bureau of Investigation shall furnish to the Department of Insurance all records of convictions, unless or until expunged, pursuant to the fingerprint-based criminal history records check. The Department of State Police shall charge a fee for conducting such checks, which fee shall be deposited into the State Police Services Fund and shall not exceed the cost of the inquiry. The applicant shall be required to pay all fees associated with conducting the criminal history record check.
    (d) The Director may adopt rules to establish procedures necessary to carry out the requirements of subsection (c) of this Section.
    (e) The Director is authorized to submit electronic fingerprint records and necessary identifying information to the NAIC, its affiliates, or subsidiaries for permanent retention in a centralized repository. The purpose of such a centralized repository is to provide Directors with access to fingerprint records in order to perform criminal history record checks.
    (f) Until such time as the Director can obtain and receive national criminal history records, the applicant shall obtain a copy of his or her fingerprints and complete criminal history record from the FBI Criminal Justice Information Services Division and the Illinois State Police and provide such information to the Department of Insurance.
(Source: P.A. 96-1332, eff. 1-1-11; 97-207, eff. 7-28-11.)

215 ILCS 5/1525

    (215 ILCS 5/1525)
    (Text of Section before amendment by P.A. 100-286)
    Sec. 1525. Resident license.
    (a) Before issuing a public adjuster license to an applicant under this Section, the Director shall find that the applicant:
        (1) is eligible to designate this State as his or her
    
home state or is a nonresident who is not eligible for a license under Section 1540;
        (2) has not committed any act that is a ground for
    
denial, suspension, or revocation of a license as set forth in Section 1555;
        (3) is trustworthy, reliable, competent, and of good
    
reputation, evidence of which may be determined by the Director;
        (4) is financially responsible to exercise the
    
license and has provided proof of financial responsibility as required in Section 1560 of this Article; and
        (5) maintains an office in the home state of
    
residence with public access by reasonable appointment or regular business hours. This includes a designated office within a home state of residence.
    (b) In addition to satisfying the requirements of subsection (a) of this Section, an individual shall:
        (1) be at least 18 years of age;
        (2) have successfully passed the public adjuster
    
examination;
        (3) designate a licensed individual public adjuster
    
responsible for the business entity's compliance with the insurance laws, rules, and regulations of this State; and
        (4) designate only licensed individual public
    
adjusters to exercise the business entity's license.
    (c) The Director may require any documents reasonably necessary to verify the information contained in the application.
(Source: P.A. 96-1332, eff. 1-1-11.)
 
    (Text of Section after amendment by P.A. 100-286)
    Sec. 1525. Resident license.
    (a) Before issuing a public adjuster license to an applicant under this Section, the Director shall find that the applicant:
        (1) is eligible to designate this State as his or her
    
home state or is a nonresident who is not eligible for a license under Section 1540;
        (2) is sufficiently rehabilitated in cases in which
    
the applicant has committed any act that is a ground for denial, suspension, or revocation of a license as set forth in Section 1555, other than convictions set forth in paragraph (6) of subsection (a) of Section 1555; with respect to applicants with convictions set forth in paragraph (6) of subsection (a) of Section 1555, the Director shall determine in accordance with Section 1550 that the conviction will not impair the ability of the applicant to engage in the position for which a license is sought;
        (3) is trustworthy, reliable, competent, and of good
    
reputation, evidence of which may be determined by the Director;
        (4) is financially responsible to exercise the
    
license and has provided proof of financial responsibility as required in Section 1560 of this Article; and
        (5) maintains an office in the home state of
    
residence with public access by reasonable appointment or regular business hours. This includes a designated office within a home state of residence.
    (b) In addition to satisfying the requirements of subsection (a) of this Section, an individual shall:
        (1) be at least 18 years of age;
        (2) have successfully passed the public adjuster
    
examination;
        (3) designate a licensed individual public adjuster
    
responsible for the business entity's compliance with the insurance laws, rules, and regulations of this State; and
        (4) designate only licensed individual public
    
adjusters to exercise the business entity's license.
    (c) The Director may require any documents reasonably necessary to verify the information contained in the application.
(Source: P.A. 100-286, eff. 1-1-18.)

215 ILCS 5/1530

    (215 ILCS 5/1530)
    Sec. 1530. Examination.
    (a) An individual applying for a public adjuster license under this Article must pass a written examination unless he or she is exempt pursuant to Section 1535 of this Article. The examination shall test the knowledge of the individual concerning the duties and responsibilities of a public adjuster and the insurance laws and regulations of this State. Examinations required by this Section shall be developed and conducted under rules and regulations prescribed by the Director.
    (b) The Director may make arrangements, including contracting with an outside testing service, for administering examinations and collecting the nonrefundable fee. Each individual applying for an examination shall remit a nonrefundable fee as prescribed by the Director. An individual who fails to appear for the examination as scheduled or fails to pass the examination shall reapply for an examination and remit all required fees and forms before being rescheduled for another examination. An individual who fails to pass the examination on his or her first attempt must wait 7 days prior to rescheduling an examination. An individual who fails to pass the examination on his or her second or subsequent attempt must wait 30 days prior to rescheduling an examination.
(Source: P.A. 99-266, eff. 1-1-16.)

215 ILCS 5/1535

    (215 ILCS 5/1535)
    Sec. 1535. Exemptions from examination.
    (a) An individual who applies for a public adjuster license in this State who was previously licensed as a public adjuster in another state based on a public adjuster examination shall not be required to complete any examination. This exemption is only available if (i) the person is currently licensed in that state or if the application is received within 12 months of the cancellation of the applicant's previous license; and (ii) if the prior state issues a certification that, at the time of cancellation, the applicant was in good standing in that state or the state's producer database records or records maintained by the NAIC, its affiliates, or subsidiaries, indicate that the public adjuster is or was licensed in good standing.
    (b) A person licensed as a public adjuster in another state based on a public adjuster examination who moves to this State shall submit an application within 90 days of establishing legal residence to become a resident licensee pursuant to Section 1525 of this Article. No prelicensing examination shall be required of that person to obtain a public adjuster license.
    (c) An individual who applies for a public adjuster license in this State who was previously licensed as a public adjuster in this State shall not be required to complete any prelicensing examination. This exemption is only available if the application is received within 12 months of the cancellation of the applicant's previous license in this State and if, at the time of cancellation, the applicant was in good standing in this State.
(Source: P.A. 96-1332, eff. 1-1-11; 97-207, eff. 7-28-11.)

215 ILCS 5/1540

    (215 ILCS 5/1540)
    Sec. 1540. Nonresident license reciprocity.
    (a) Unless denied licensure pursuant to Section 1555 of this Article, a nonresident person shall receive a nonresident public adjuster license if:
        (1) the person is currently licensed as a resident
    
public adjuster and in good standing in his or her home state;
        (2) the person has submitted the proper request for
    
licensure and has provided proof of financial responsibility as required in Section 1560 of this Article;
        (3) the person has submitted or transmitted to the
    
Director the appropriate completed application for licensure; and
        (4) the person's home state awards nonresident public
    
adjuster licenses to residents of this State on the same basis.
    (b) The Director may verify the public adjuster's licensing status through the producer database maintained by the NAIC, its affiliates, or subsidiaries.
    (c) As a condition to continuation of a public adjuster license issued under this Section, the licensee shall maintain a resident public adjuster license in his or her home state. The nonresident public adjuster license issued under this Section shall terminate and be surrendered immediately to the Director if the home state public adjuster license terminates for any reason, unless the public adjuster has been issued a license as a resident public adjuster in his or her new home state. Notification to the state or states where the nonresident license is issued must be made as soon as possible, yet no later than 30 days of change in new state resident license. The licensee shall include his or her new and old address on the notification. A new state resident license is required for nonresident licenses to remain valid. The new state resident license must have reciprocity with the licensing nonresident state or states for the nonresident license not to terminate.
(Source: P.A. 96-1332, eff. 1-1-11; 97-813, eff. 7-13-12.)

215 ILCS 5/1545

    (215 ILCS 5/1545)
    Sec. 1545. License.
    (a) Unless denied licensure under this Article, persons who have met the requirements of this Article shall be issued a public adjuster license.
    (b) A public adjuster license shall remain in effect unless revoked, terminated, or suspended as long as the requirements for license renewal are met by the due date.
    (c) The licensee shall inform the Director by any means acceptable to the Director of a change of address, change of legal name, or change of information submitted on the application within 30 days of the change.
    (d) A licensed public adjuster shall be subject to Article XXVI of this Code.
    (e) A public adjuster who allows his or her license to lapse may, within 12 months from the due date of the renewal, be issued a new public adjuster license without necessity of passing a written examination. However, a penalty in the amount of double the unpaid renewal fee shall be required for the issue of the new public adjuster license.
    (f) A licensed public adjuster that is unable to comply with license renewal procedures due to military service or a long-term medical disability may request a waiver of the procedures in subsection (e) of this Section. The public adjuster may also request a waiver of any examination requirement, fine, or other sanction imposed for failure to comply with renewal procedures.
    (g) The license shall contain the licensee's name, city and state of business address, personal identification number, the date of issuance, the expiration date, and any other information the Director deems necessary.
    (h) In order to assist in the performance of the Director's duties, the Director may contract with non-governmental entities, including the NAIC or any affiliates or subsidiaries that the NAIC oversees, to perform any ministerial functions, including the collection of fees and data, related to licensing that the Director may deem appropriate.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1550

    (215 ILCS 5/1550)
    (This Section may contain text from a Public Act with a delayed effective date)
    Sec. 1550. Applicant convictions.
    (a) The Director and the Department shall not require applicants to report the following information and shall not collect or consider the following criminal history records in connection with a public adjuster license application:
        (1) Juvenile adjudications of delinquent minors as
    
defined in Section 5-105 of the Juvenile Court Act of 1987, subject to the restrictions set forth in Section 5-130 of that Act.
        (2) Law enforcement records, court records, and
    
conviction records of an individual who was 17 years old at the time of the offense and before January 1, 2014, unless the nature of the offense required the individual to be tried as an adult.
        (3) Records of arrest not followed by a formal charge
    
or conviction.
        (4) Records of arrest where charges were dismissed
    
unless related to the duties and responsibilities of a public adjuster. However, applicants shall not be asked to report any arrests, and any arrest not followed by a conviction shall not be the basis of a denial and may be used only to assess an applicant's rehabilitation.
        (5) Convictions overturned by a higher court.
        (6) Convictions or arrests that have been sealed or
    
expunged.
    (b) The Director, upon a finding that an applicant for a license under this Act was previously convicted of a felony or misdemeanor involving dishonesty or fraud, shall consider any mitigating factors and evidence of rehabilitation contained in the applicant's record, including any of the following factors and evidence, to determine if a license may be denied because the prior conviction will impair the ability of the applicant to engage in the position for which a license is sought:
        (1) the bearing, if any, of the offense for which
    
the applicant was previously convicted on the duties, functions, and responsibilities of the position for which a license is sought;
        (2) whether the conviction suggests a future
    
propensity to endanger the safety and property of others while performing the duties and responsibilities for which a license is sought;
        (3) if the applicant was previously licensed or
    
employed in this State or other states or jurisdictions, then the lack of prior misconduct arising from or related to the licensed position or position of employment;
        (4) whether 5 years since a felony conviction or 3
    
years since release from confinement for the conviction, whichever is later, have passed without a subsequent conviction;
        (5) successful completion of sentence and, for
    
applicants serving a term of parole or probation, a progress report provided by the applicant's probation or parole officer that documents the applicant's compliance with conditions of supervision;
        (6) evidence of the applicant's present fitness and
    
professional character;
        (7) evidence of rehabilitation or rehabilitative
    
effort during or after incarceration or during or after a term of supervision, including, but not limited to, a certificate of good conduct under Section 5-5.5-25 of the Unified Code of Corrections or certificate of relief from disabilities under Section 5-5.5-10 of the Unified Code of Corrections; and
        (8) any other mitigating factors that contribute to
    
the person's potential and current ability to perform the duties and responsibilities of a public adjuster.
    (c) If a nonresident licensee meets the standards set forth in items (1) through (4) of subsection (a) of Section 1540 and has received consent pursuant to 18 U.S.C. 1033(e)(2) from his or her home state, the Director shall grant the nonresident licensee a license.
    (d) If the Director refuses to issue a license to an applicant based on a conviction or convictions, in whole or in part, then the Director shall notify the applicant of the denial in writing with the following included in the notice of denial:
        (1) a statement about the decision to refuse to issue
    
a license;
        (2) a list of convictions that the Director
    
determined will impair the applicant's ability to engage in the position for which a license is sought;
        (3) a list of the convictions that were the sole or
    
partial basis for the refusal to issue a license; and
        (4) a summary of the appeal process or the earliest
    
the applicant may reapply for a license, whichever is applicable.
(Source: P.A. 100-286, eff. 1-1-18.)

215 ILCS 5/1555

    (215 ILCS 5/1555)
    (Text of Section before amendment by P.A. 100-286)
    Sec. 1555. License denial, nonrenewal, or revocation.
    (a) The Director may place on probation, suspend, revoke, deny, or refuse to issue or renew a public adjuster's license or may levy a civil penalty or any combination of actions, for any one or more of the following causes:
        (1) providing incorrect, misleading, incomplete, or
    
materially untrue information in the license application;
        (2) violating any insurance laws, or violating any
    
regulation, subpoena, or order of the Director or of another state's Director;
        (3) obtaining or attempting to obtain a license
    
through misrepresentation or fraud;
        (4) improperly withholding, misappropriating, or
    
converting any monies or properties received in the course of doing insurance business;
        (5) intentionally misrepresenting the terms of an
    
actual or proposed insurance contract or application for insurance;
        (6) having been convicted of a felony or misdemeanor
    
involving dishonesty or fraud, unless the individual demonstrates to the Director sufficient rehabilitation to warrant the public trust;
        (7) having admitted or been found to have committed
    
any insurance unfair trade practice or insurance fraud;
        (8) using fraudulent, coercive, or dishonest
    
practices; or demonstrating incompetence, untrustworthiness, or financial irresponsibility in the conduct of business in this State or elsewhere;
        (9) having an insurance license or public adjuster
    
license or its equivalent, denied, suspended, or revoked in any other state, province, district, or territory;
        (10) forging another's name to an application for
    
insurance or to any document related to an insurance transaction;
        (11) cheating, including improperly using notes or
    
any other reference material, to complete an examination for an insurance license or public adjuster license;
        (12) knowingly accepting insurance business from or
    
transacting business with an individual who is not licensed but who is required to be licensed by the Director;
        (13) failing to comply with an administrative or
    
court order imposing a child support obligation;
        (14) failing to pay State income tax or comply with
    
any administrative or court order directing payment of State income tax;
        (15) failing to comply with or having violated any of
    
the standards set forth in Section 1590 of this Law; or
        (16) failing to maintain the records required by
    
Section 1585 of this Law.
    (b) If the action by the Director is to nonrenew, suspend, or revoke a license or to deny an application for a license, the Director shall notify the applicant or licensee and advise, in writing, the applicant or licensee of the reason for the suspension, revocation, denial, or nonrenewal of the applicant's or licensee's license. The applicant or licensee may make written demand upon the Director within 30 days after the date of mailing for a hearing before the Director to determine the reasonableness of the Director's action. The hearing must be held within not fewer than 20 days nor more than 30 days after the mailing of the notice of hearing and shall be held pursuant to 50 Ill. Adm. Code 2402.
    (c) The license of a business entity may be suspended, revoked, or refused if the Director finds, after hearing, that an individual licensee's violation was known or should have been known by one or more of the partners, officers, or managers acting on behalf of the business entity and the violation was neither reported to the Director, nor corrective action taken.
    (d) In addition to or in lieu of any applicable denial, suspension or revocation of a license, a person may, after hearing, be subject to a civil penalty. In addition to or instead of any applicable denial, suspension, or revocation of a license, a person may, after hearing, be subject to a civil penalty of up to $10,000 for each cause for denial, suspension, or revocation, however, the civil penalty may total no more than $100,000.
    (e) The Director shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by this Article against any person who is under investigation for or charged with a violation of this Article even if the person's license or registration has been surrendered or has lapsed by operation of law.
    (f) Any individual whose public adjuster's license is revoked or whose application is denied pursuant to this Section shall be ineligible to apply for a public adjuster's license for 5 years. A suspension pursuant to this Section may be for any period of time up to 5 years.
(Source: P.A. 96-1332, eff. 1-1-11.)
 
    (Text of Section after amendment by P.A. 100-286)
    Sec. 1555. License denial, nonrenewal, or revocation.
    (a) The Director may place on probation, suspend, revoke, deny, or refuse to issue or renew a public adjuster's license or may levy a civil penalty or any combination of actions, for any one or more of the following causes:
        (1) providing incorrect, misleading, incomplete, or
    
materially untrue information in the license application;
        (2) violating any insurance laws, or violating any
    
regulation, subpoena, or order of the Director or of another state's Director;
        (3) obtaining or attempting to obtain a license
    
through misrepresentation or fraud;
        (4) improperly withholding, misappropriating, or
    
converting any monies or properties received in the course of doing insurance business;
        (5) intentionally misrepresenting the terms of an
    
actual or proposed insurance contract or application for insurance;
        (6) having been convicted of a felony or misdemeanor
    
involving dishonesty or fraud, unless the individual demonstrates to the Director sufficient rehabilitation to warrant the public trust; consideration of such conviction of an applicant shall be in accordance with Section 1550;
        (7) having admitted or been found to have committed
    
any insurance unfair trade practice or insurance fraud;
        (8) using fraudulent, coercive, or dishonest
    
practices; or demonstrating incompetence, untrustworthiness, or financial irresponsibility in the conduct of business in this State or elsewhere;
        (9) having an insurance license or public adjuster
    
license or its equivalent, denied, suspended, or revoked in any other state, province, district, or territory;
        (10) forging another's name to an application for
    
insurance or to any document related to an insurance transaction;
        (11) cheating, including improperly using notes or
    
any other reference material, to complete an examination for an insurance license or public adjuster license;
        (12) knowingly accepting insurance business from or
    
transacting business with an individual who is not licensed but who is required to be licensed by the Director;
        (13) failing to comply with an administrative or
    
court order imposing a child support obligation;
        (14) failing to pay State income tax or comply with
    
any administrative or court order directing payment of State income tax;
        (15) failing to comply with or having violated any of
    
the standards set forth in Section 1590 of this Law; or
        (16) failing to maintain the records required by
    
Section 1585 of this Law.
    (b) If the action by the Director is to nonrenew, suspend, or revoke a license or to deny an application for a license, the Director shall notify the applicant or licensee and advise, in writing, the applicant or licensee of the reason for the suspension, revocation, denial, or nonrenewal of the applicant's or licensee's license. The applicant or licensee may make written demand upon the Director within 30 days after the date of mailing for a hearing before the Director to determine the reasonableness of the Director's action. The hearing must be held within not fewer than 20 days nor more than 30 days after the mailing of the notice of hearing and shall be held pursuant to 50 Ill. Adm. Code 2402.
    (c) The license of a business entity may be suspended, revoked, or refused if the Director finds, after hearing, that an individual licensee's violation was known or should have been known by one or more of the partners, officers, or managers acting on behalf of the business entity and the violation was neither reported to the Director, nor corrective action taken.
    (d) In addition to or in lieu of any applicable denial, suspension or revocation of a license, a person may, after hearing, be subject to a civil penalty. In addition to or instead of any applicable denial, suspension, or revocation of a license, a person may, after hearing, be subject to a civil penalty of up to $10,000 for each cause for denial, suspension, or revocation, however, the civil penalty may total no more than $100,000.
    (e) The Director shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by this Article against any person who is under investigation for or charged with a violation of this Article even if the person's license or registration has been surrendered or has lapsed by operation of law.
    (f) Any individual whose public adjuster's license is revoked or whose application is denied pursuant to this Section shall be ineligible to apply for a public adjuster's license for 5 years. A suspension pursuant to this Section may be for any period of time up to 5 years.
(Source: P.A. 100-286, eff. 1-1-18.)

215 ILCS 5/1560

    (215 ILCS 5/1560)
    Sec. 1560. Bond or letter of credit.
    (a) Prior to the issuance of a license as a public adjuster and for the duration of the license, the applicant shall secure evidence of financial responsibility in a format prescribed by the Director through a surety bond or irrevocable letter of credit, subject to all of the following requirements:
        (1) A surety bond executed and issued by an insurer
    
authorized to issue surety bonds in this State, which bond:
            (A) shall be in the minimum amount of $20,000;
            (B) shall be in favor of this State and shall
        
specifically authorize recovery by the Director on behalf of any person in this State who sustained damages as the result of erroneous acts, failure to act, conviction of fraud, or conviction of unfair practices in his or her capacity as a public adjuster; and
            (C) shall not be terminated unless at least 30
        
days' prior written notice will have been filed with the Director and given to the licensee; and
        (2) An irrevocable letter of credit issued by a
    
qualified financial institution, which letter of credit:
            (A) shall be in the minimum amount of $20,000;
            (B) shall be to an account to the Director and
        
subject to lawful levy of execution on behalf of any person to whom the public adjuster has been found to be legally liable as the result of erroneous acts, failure to act, fraudulent acts, or unfair practices in his or her capacity as a public adjuster; and
            (C) shall not be terminated unless at least 30
        
days' prior written notice will have been filed with the and given to the licensee.
    (b) The issuer of the evidence of financial responsibility shall notify the Director upon termination of the bond or letter of credit, unless otherwise directed by the Director.
    (c) The Director may ask for the evidence of financial responsibility at any time he or she deems relevant.
    (d) The authority to act as a public adjuster shall automatically terminate if the evidence of financial responsibility terminates or becomes impaired.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1563

    (215 ILCS 5/1563)
    Sec. 1563. Fees.
    (a) The fees required by this Article are as follows:
        (1) Public adjuster license fee of $250, payable once
    
every 2 years.
        (2) Business entity license fee of $250, payable once
    
every 2 years.
        (3) Application fee of $50 for processing each
    
request to take the written examination for a public adjuster license.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1565

    (215 ILCS 5/1565)
    Sec. 1565. Continuing education.
    (a) An individual who holds a public adjuster license and who is not exempt under subsection (b) of this Section shall satisfactorily complete a minimum of 24 hours of continuing education courses, including 3 hours of classroom ethics instruction, reported on a biennial basis in conjunction with the license renewal cycle.
    The Director may not approve a course of study unless the course provides for classroom, seminar, or self-study instruction methods. A course given in a combination instruction method of classroom or seminar and self-study shall be deemed to be a self-study course unless the classroom or seminar certified hours meets or exceeds two-thirds of the total hours certified for the course. The self-study material used in the combination course must be directly related to and complement the classroom portion of the course in order to be considered for credit. An instruction method other than classroom or seminar shall be considered as self-study methodology. Self-study credit hours require the successful completion of an examination covering the self-study material. The examination may not be self-evaluated. However, if the self-study material is completed through the use of an approved computerized interactive format whereby the computer validates the successful completion of the self-study material, no additional examination is required. The self-study credit hours contained in a certified course shall be considered classroom hours when at least two-thirds of the hours are given as classroom or seminar instruction.
    The public adjuster must complete the course in advance of the renewal date to allow the education provider time to report the credit to the Department.
    (b) This Section shall not apply to:
        (1) licensees not licensed for one full year prior to
    
the end of the applicable continuing education biennium; or
        (2) licensees holding nonresident public adjuster
    
licenses who have met the continuing education requirements of their home state and whose home state gives credit to residents of this State on the same basis.
    (c) Only continuing education courses approved by the Director shall be used to satisfy the continuing education requirement of subsection (a) of this Section.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1570

    (215 ILCS 5/1570)
    Sec. 1570. Public adjuster fees.
    (a) A public adjuster shall not pay a commission, service fee, or other valuable consideration to a person for investigating or settling claims in this State if that person is required to be licensed under this Article and is not so licensed.
    (b) A person shall not accept a commission, service fee, or other valuable consideration for investigating or settling claims in this State if that person is required to be licensed under this Article and is not so licensed.
    (c) A public adjuster may pay or assign commission, service fees, or other valuable consideration to persons who do not investigate or settle claims in this State, unless the payment would violate State law.
    (d) A public adjuster may not charge, agree to, or accept any compensation, payment, commissions, fee, or other valuable consideration in excess of 10% of the amount of the insurance settlement claim paid by the insurer on any claim resulting from a catastrophic event, unless approved in writing by the Director. Application for exception to the 10% limit must be made in writing. The request must contain specific reasons as to why the consideration should be in excess of 10% and proof that the policyholder would accept the consideration. The Director must act on any request within 5 business days after receipt of the request.
    For the purpose of this subsection (d), "catastrophic event" means an occurrence of widespread or severe damage or loss of property producing an overwhelming demand on State and local response resources and mechanisms and a severe long-term effect on general economic activity, and that severely affects State, local, and private sector capabilities to begin to sustain response activities resulting from any catastrophic cause, including, but not limited to, fire, including arson (provided the fire was not caused by the willful action of an owner or resident of the property), flood, earthquake, wind, storm, explosion, or extended periods of severe inclement weather as determined by declaration of a State of disaster by the Governor. This declaration may be made on a county-by-county basis and shall be in effect for 90 days, but may be renewed for 30-day intervals thereafter.
(Source: P.A. 98-701, eff. 1-1-15.)

215 ILCS 5/1575

    (215 ILCS 5/1575)
    Sec. 1575. Contract between public adjuster and insured.
    (a) Public adjusters shall ensure that all contracts for their services are in writing and contain the following terms:
        (1) legible full name of the adjuster signing the
    
contract, as specified in Department records;
        (2) permanent home state business address and phone
    
number;
        (3) license number;
        (4) title of "Public Adjuster Contract";
        (5) the insured's full name, street address,
    
insurance company name, and policy number, if known or upon notification;
        (6) a description of the loss and its location, if
    
applicable;
        (7) description of services to be provided to the
    
insured;
        (8) signatures of the public adjuster and the insured;
        (9) date and time the contract was signed by the
    
public adjuster and date and time the contract was signed by the insured;
        (10) attestation language stating that the public
    
adjuster is fully bonded pursuant to State law; and
        (11) full salary, fee, commission, compensation, or
    
other considerations the public adjuster is to receive for services.
    (b) The contract may specify that the public adjuster shall be named as a co-payee on an insurer's payment of a claim.
        (1) If the compensation is based on a share of the
    
insurance settlement, the exact percentage shall be specified.
        (2) Initial expenses to be reimbursed to the public
    
adjuster from the proceeds of the claim payment shall be specified by type, with dollar estimates set forth in the contract and with any additional expenses first approved by the insured.
        (3) Compensation provisions in a public adjuster
    
contract shall not be redacted in any copy of the contract provided to the Director.
    (c) If the insurer, not later than 5 business days after the date on which the loss is reported to the insurer, either pays or commits in writing to pay to the insured the policy limit of the insurance policy, the public adjuster shall:
        (1) not receive a commission consisting of a
    
percentage of the total amount paid by an insurer to resolve a claim;
        (2) inform the insured that loss recovery amount
    
might not be increased by insurer; and
        (3) be entitled only to reasonable compensation from
    
the insured for services provided by the public adjuster on behalf of the insured, based on the time spent on a claim and expenses incurred by the public adjuster, until the claim is paid or the insured receives a written commitment to pay from the insurer.
    (d) A public adjuster shall provide the insured a written disclosure concerning any direct or indirect financial interest that the public adjuster has with any other party who is involved in any aspect of the claim, other than the salary, fee, commission, or other consideration established in the written contract with the insured, including, but not limited to, any ownership of or any compensation expected to be received from, any construction firm, salvage firm, building appraisal firm, board-up company, or any other firm that provides estimates for work, or that performs any work, in conjunction with damages caused by the insured loss on which the public adjuster is engaged. The word "firm" shall include any corporation, partnership, association, joint-stock company, or person.
    (e) A public adjuster contract may not contain any contract term that:
        (1) allows the public adjuster's percentage fee to be
    
collected when money is due from an insurance company, but not paid, or that allows a public adjuster to collect the entire fee from the first check issued by an insurance company, rather than as a percentage of each check issued by an insurance company;
        (2) requires the insured to authorize an insurance
    
company to issue a check only in the name of the public adjuster;
        (3) precludes a public adjuster or an insured from
    
pursuing civil remedies;
        (4) includes any hold harmless agreement that
    
provides indemnification to the public adjuster by the insured for liability resulting from the public adjuster's negligence; or
        (5) provides power of attorney by which the public
    
adjuster can act in the place and instead of the insured.
    (f) The following provisions apply to a contract between a public adjuster and an insured:
        (1) Prior to the signing of the contract, the public
    
adjuster shall provide the insured with a separate signed and dated disclosure document regarding the claim process that states:
    "Property insurance policies obligate the insured to
    
present a claim to his or her insurance company for consideration. There are 3 types of adjusters that could be involved in that process. The definitions of the 3 types are as follows:
            (A) "Company adjuster" means the insurance
        
adjusters who are employees of an insurance company. They represent the interest of the insurance company and are paid by the insurance company. They will not charge you a fee.
            (B) "Independent adjuster" means the insurance
        
adjusters who are hired on a contract basis by an insurance company to represent the insurance company's interest in the settlement of the claim. They are paid by your insurance company. They will not charge you a fee.
            (C) "Public adjuster" means the insurance
        
adjusters who do not work for any insurance company. They work for the insured to assist in the preparation, presentation and settlement of the claim. The insured hires them by signing a contract agreeing to pay them a fee or commission based on a percentage of the settlement, or other method of compensation.".
        (2) The insured is not required to hire a public
    
adjuster to help the insured meet his or her obligations under the policy, but has the right to do so.
        (3) The public adjuster is not a representative or
    
employee of the insurer.
        (4) The salary, fee, commission, or other
    
consideration is the obligation of the insured, not the insurer, except when rights have been assigned to the public adjuster by the insured.
    (g) The contracts shall be executed in duplicate to provide an original contract to the public adjuster, and an original contract to the insured. The public adjuster's original contract shall be available at all times for inspection without notice by the Director.
    (h) The public adjuster shall provide the insurer with an exact copy of the contract by the insured, authorizing the public adjuster to represent the insured's interest.
    (i) The public adjuster shall give the insured written notice of the insured's rights as a consumer under the law of this State.
    (j) A public adjuster shall not provide services until a written contract with the insured has been executed, on a form filed with and approved by the Director. At the option of the insured, any such contract shall be voidable for 5 business days after execution. The insured may void the contract by notifying the public adjuster in writing by (i) registered or certified mail, return receipt requested, to the address shown on the contract or (ii) personally serving the notice on the public adjuster.
    (k) If the insured exercises the right to rescind the contract, anything of value given by the insured under the contract will be returned to the insured within 15 business days following the receipt by the public adjuster of the cancellation notice.
(Source: P.A. 96-1332, eff. 1-1-11; 97-333, eff. 8-12-11.)

215 ILCS 5/1580

    (215 ILCS 5/1580)
    Sec. 1580. Escrow or trust accounts. A public adjuster who receives, accepts, or holds any funds on behalf of an insured towards the settlement of a claim for loss or damage shall deposit the funds in a non-interest bearing escrow or trust account in a financial institution that is insured by an agency of the federal government in the public adjuster's home state or where the loss occurred.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1585

    (215 ILCS 5/1585)
    Sec. 1585. Record retention.
    (a) A public adjuster shall maintain a complete record of each transaction as a public adjuster. The records required by this Section shall include the following:
        (1) name of the insured;
        (2) date, location and amount of the loss;
        (3) a copy of the contract between the public
    
adjuster and insured and a copy of the separate disclosure document;
        (4) name of the insurer, amount, expiration date and
    
number of each policy carried with respect to the loss;
        (5) itemized statement of the insured's recoveries;
        (6) itemized statement of all compensation received
    
by the public adjuster, from any source whatsoever, in connection with the loss;
        (7) a register of all monies received, deposited,
    
disbursed, or withdrawn in connection with a transaction with an insured, including fees transfers and disbursements from a trust account and all transactions concerning all interest bearing accounts;
        (8) name of public adjuster who executed the contract;
        (9) name of the attorney representing the insured, if
    
applicable, and the name of the claims representatives of the insurance company; and
        (10) evidence of financial responsibility in a format
    
prescribed by the Director.
    (b) Records shall be maintained for at least 7 years after the termination of the transaction with an insured and shall be open to examination by the Director at all times.
    (c) Records submitted to the Director in accordance with this Section that contain information identified in writing as proprietary by the public adjuster shall be treated as confidential by the Director and shall not be subject to the Freedom of Information Act.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1590

    (215 ILCS 5/1590)
    Sec. 1590. Standards of conduct of public adjuster.
    (a) A public adjuster is obligated, under his or her license, to serve with objectivity and complete loyalty for the interests of his client alone, and to render to the insured such information, counsel, and service, as within the knowledge, understanding, and opinion in good faith of the licensee, as will best serve the insured's insurance claim needs and interest.
    (b) A public adjuster may not propose or attempt to propose to any person that the public adjuster represent that person while a loss-producing occurrence is continuing, nor while the fire department or its representatives are engaged at the damaged premises, nor between the hours of 7:00 p.m. and 8:00 a.m.
    (c) A public adjuster shall not permit an unlicensed employee or representative of the public adjuster to conduct business for which a license is required under this Article.
    (d) A public adjuster shall not have a direct or indirect financial interest in any aspect of the claim, other than the salary, fee, commission, or other consideration established in the written contract with the insured, unless full written disclosure has been made to the insured as set forth in subsection (g) of Section 1575.
    (e) A public adjuster shall not acquire any interest in the salvage of property subject to the contract with the insured unless the public adjuster obtains written permission from the insured after settlement of the claim with the insurer as set forth in subsection (g) of Section 1575 of this Article.
    (f) The public adjuster shall abstain from referring or directing the insured to get needed repairs or services in connection with a loss from any person, unless disclosed to the insured:
        (1) with whom the public adjuster has a financial
    
interest; or
        (2) from whom the public adjuster may receive direct
    
or indirect compensation for the referral.
    (g) The public adjuster shall disclose to an insured if he or she has any interest or will be compensated by any construction firm, salvage firm, building appraisal firm, board-up company, or any other firm that performs any work in conjunction with damages caused by the insured loss. The word "firm" shall include any corporation, partnership, association, joint-stock company or individual as set forth in Section 1575 of this Article.
    (h) Any compensation or anything of value in connection with an insured's specific loss that will be received by a public adjuster shall be disclosed by the public adjuster to the insured in writing including the source and amount of any such compensation.
    (i) In all cases where the loss giving rise to the claim for which the public adjuster was retained arise from damage to a personal residence, the insurance proceeds shall be delivered to the named insured or his or her designee. Where proceeds paid by an insurance company are paid jointly to the insured and the public adjuster, the insured shall release such portion of the proceeds that are due the public adjuster within 30 calendar days after the insured's receipt of the insurance company's check, money order, draft, or release of funds. If the proceeds are not so released to the public adjuster within 30 calendar days, the insured shall provide the public adjuster with a written explanation of the reason for the delay.
    (j) Public adjusters shall adhere to the following general ethical requirements:
        (1) a public adjuster shall not undertake the
    
adjustment of any claim if the public adjuster is not competent and knowledgeable as to the terms and conditions of the insurance coverage, or which otherwise exceeds the public adjuster's current expertise;
        (2) a public adjuster shall not knowingly make any
    
oral or written material misrepresentations or statements which are false or maliciously critical and intended to injure any person engaged in the business of insurance to any insured client or potential insured client;
        (3) no public adjuster, while so licensed by the
    
Department, may represent or act as a company adjuster or independent adjuster on the same claim;
        (4) the contract shall not be construed to prevent an
    
insured from pursuing any civil remedy after the 5-business day revocation or cancellation period;
        (5) a public adjuster shall not enter into a contract
    
or accept a power of attorney that vests in the public adjuster the effective authority to choose the persons who shall perform repair work;
        (6) a public adjuster shall ensure that all contracts
    
for the public adjuster's services are in writing and set forth all terms and conditions of the engagement; and
        (7) a public adjuster shall not advance money or any
    
valuable consideration, except emergency services to an insured pending adjustment of a claim.
    (k) A public adjuster may not agree to any loss settlement without the insured's knowledge and consent and shall, upon the insured's request, provide the insured with a document setting forth the scope, amount, and value of the damages prior to request by the insured for authority to settle the loss.
    (l) A public adjuster shall not provide legal advice or representation to the insured or engage in the unauthorized practice of law.
    (m) A public adjuster shall not represent that he or she is a representative of an insurance company, a fire department, or the State of Illinois, that he or she is a fire investigator, that his or her services are required for the insured to submit a claim to the insured's insurance company, or that he or she may provide legal advice or representation to the insured. A public adjuster may represent that he or she has been licensed by the State of Illinois.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1595

    (215 ILCS 5/1595)
    Sec. 1595. Reporting of actions.
    (a) The public adjuster shall report to the Director any administrative action taken against the public adjuster in another jurisdiction or by another governmental agency in this State within 30 days of the final disposition of the matter. This report shall include a copy of the order, consent to order, or other relevant legal documents.
    (b) Within 30 days of the initial pretrial hearing date, the public adjuster shall report to the Director any criminal prosecution of the public adjuster taken in any jurisdiction. The report shall include a copy of the initial complaint filed, the order resulting from the hearing, and any other relevant legal documents.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1600

    (215 ILCS 5/1600)
    Sec. 1600. Examinations.
    (a) The Director shall have the power to examine any applicant or any person licensed or registered pursuant to this Article.
    (b) Every person being examined and its officers, directors, and members must provide to the Director convenient and free access, at all reasonable hours, to all books, records, documents, and other papers relating to its public adjusting affairs. The officers, directors, members, and employees must facilitate and aid in such examinations so far as it is in their power to do so.
    (c) Examiners may be designated by the Director. Such examiners shall make their reports to the Director pursuant to this Section. Any report alleging substantive violations shall be in writing and shall be based upon the facts ascertained from the books, records, documents, papers, and other evidence obtained by the examiners or ascertained from the testimony of the officers, directors, members, or other individuals examined under oath or ascertained by notarized affidavits received by the examiners. The reports shall be verified by the examiners.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1605

    (215 ILCS 5/1605)
    Sec. 1605. Injunctive relief. Any person who acts as or holds himself out to be a public adjuster without holding a valid and current license to do so is hereby declared to be inimical to the public welfare and to constitute a public nuisance. The Director may report such practice to the Attorney General of the State of Illinois whose duty it is to apply forthwith by complaint on relation of the Director in the name of the people of the State of Illinois, as plaintiff, for injunctive relief in the circuit court of the county where such practice occurred to enjoin the person from engaging in such practice; and upon the filing of a verified petition in such court, the court, if satisfied by affidavit or otherwise that the person has been engaged in such practice without a valid and current license to do so, may enter a temporary restraining order without notice or bond enjoining the defendant from such further practice. A copy of the verified complaint shall be served upon the defendant and the proceedings shall thereafter be conducted as in other civil cases. If it is established that the defendant has been or is engaged in such unlawful practice, then the court may enter an order or judgment perpetually enjoining the defendant from such further practice. In all proceedings hereunder, the court, in its discretion, may apportion the costs among the parties interested in the action, including the costs of filing the complaint, service of process, witness fees and expenses, court reporter charges, and reasonable attorney fees. In case of violation of any injunctive order entered under the provisions of this Section, the court may try and punish the offender for contempt of court. Such injunction proceedings shall be in addition to, and not in lieu of, all penalties and other remedies.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1610

    (215 ILCS 5/1610)
    Sec. 1610. Additional penalties. In addition to any other penalty set forth in this Article, any person violating Section 1605 of this Code shall be guilty of a Class A misdemeanor and any person misappropriating or converting any monies collected as a public adjuster, whether licensed or not, shall be guilty of a Class 4 felony.
(Source: P.A. 96-1332, eff. 1-1-11.)

215 ILCS 5/1615

    (215 ILCS 5/1615)
    Sec. 1615. Rules. The Director shall promulgate reasonable rules as are necessary or proper to carry out the purposes of this Article.
(Source: P.A. 96-1332, eff. 1-1-11.)