Sen. Denny Jacobs

Filed: 3/22/2004

 

 


 

 


 
09300SB2404sam003 LRB093 20536 WGH 48957 a

1
AMENDMENT TO SENATE BILL 2404

2     AMENDMENT NO. ______. Amend Senate Bill 2404 by replacing
3 everything after the enacting clause with the following:
 
4     "Section 5. The Illinois Insurance Code is amended by
5 changing Section 143a-2 as follows:
 
6     (215 ILCS 5/143a-2)  (from Ch. 73, par. 755a-2)
7     Sec. 143a-2. (1) Additional uninsured motor vehicle
8 coverage. No policy insuring against loss resulting from
9 liability imposed by law for bodily injury or death suffered by
10 any person arising out of the ownership, maintenance or use of
11 a motor vehicle shall be renewed or delivered or issued for
12 delivery in this State with respect to any motor vehicle
13 designed for use on public highways and required to be
14 registered in this State unless uninsured motorist coverage as
15 required in Section 143a of this Code is included in an amount
16 equal to the insured's bodily injury liability limits unless
17 specifically rejected by the insured as provided in paragraph
18 (2) of this Section. Each insurance company providing the
19 coverage must provide applicants with a brief description of
20 the coverage and advise them of their right to reject the
21 coverage in excess of the limits set forth in Section 7-203 of
22 The Illinois Vehicle Code. The provisions of this amendatory
23 Act of 1990 apply to policies of insurance applied for after
24 June 30, 1991.

 

 

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1     (2) Right of rejection of additional uninsured motorist
2 coverage. Any named insured After June 30, 1991, every
3 application for motor vehicle coverage must contain a space for
4 indicating the rejection of additional uninsured motorist
5 coverage. No rejection of that coverage may be effective unless
6 the applicant signs or initials the indication of rejection.
7 The applicant may reject additional uninsured motorist
8 coverage in excess of the limits set forth in Section 7-203 of
9 the Illinois Vehicle Code by making a written request for
10 limits of uninsured motorist coverage which are less than
11 bodily injury liability limits or a written rejection of limits
12 in excess of those required by law. This election or rejection
13 shall be binding on all persons insured under the policy. In
14 those cases, including policies first issued before July 1,
15 1991, where the insured has elected to purchase limits of
16 uninsured motorist coverage which are less than bodily injury
17 liability limits or to reject limits in excess of those
18 required by law, the insurer need not provide in any renewal,
19 reinstatement, reissuance, substitute, amended, replacement or
20 supplementary policy, coverage in excess of that elected by the
21 insured in connection with a policy previously issued to such
22 insured by the same insurer unless the insured subsequently
23 makes a written request for such coverage.
24     (3) The original document application indicating the
25 applicant's selection of uninsured motorist coverage limits
26 shall constitute sufficient evidence of the applicant's
27 selection of uninsured motorist coverage limits and shall be
28 binding on all persons insured under the policy. For purposes
29 of this Section any reproduction of the document application by
30 means of photograph, photostat, microfiche, computerized
31 optical imaging process, or other similar process or means of
32 reproduction shall be deemed the equivalent of the original
33 document application. Any such document, application,
34 selection, or rejection form obtained before the effective date

 

 

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1 of this amendatory Act of the 93rd General Assembly and which
2 indicated the applicant's or insured's selection shall be
3 deemed sufficient evidence of the applicant's or insured's
4 selection of additional uninsured motorist coverage.
5     (4) For the purpose of this Code the term "underinsured
6 motor vehicle" means a motor vehicle whose ownership,
7 maintenance or use has resulted in bodily injury or death of
8 the insured, as defined in the policy, and for which the sum of
9 the limits of liability under all bodily injury liability
10 insurance policies or under bonds or other security required to
11 be maintained under Illinois law applicable to the driver or to
12 the person or organization legally responsible for such vehicle
13 and applicable to the vehicle, is less than the limits for
14 underinsured coverage provided the insured as defined in the
15 policy at the time of the accident. The limits of liability for
16 an insurer providing underinsured motorist coverage shall be
17 the limits of such coverage, less those amounts actually
18 recovered under the applicable bodily injury insurance
19 policies, bonds or other security maintained on the
20 underinsured motor vehicle. However, the maximum amount
21 payable by the underinsured motorist coverage carrier shall not
22 exceed the amount by which the limits of the underinsured
23 motorist coverage exceeds the limits of the bodily injury
24 liability insurance of the owner or operator of the
25 underinsured motor vehicle.
26      On or after July 1, 1983, no policy insuring against loss
27 resulting from liability imposed by law for bodily injury or
28 death suffered by any person arising out of the ownership,
29 maintenance or use of a motor vehicle shall be renewed or
30 delivered or issued for delivery in this State with respect to
31 any motor vehicle designed for use on public highways and
32 required to be registered in this State unless underinsured
33 motorist coverage is included in such policy in an amount equal
34 to the total amount of uninsured motorist coverage provided in

 

 

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1 that policy where such uninsured motorist coverage exceeds the
2 limits set forth in Section 7-203 of the Illinois Vehicle Code.
3     (5) Scope. Nothing herein shall prohibit an insurer from
4 setting forth policy terms and conditions which provide that if
5 the insured has coverage available under this Section under
6 more than one policy or provision of coverage, any recovery or
7 benefits may be equal to, but may not exceed, the higher of the
8 applicable limits of the respective coverage, and the limits of
9 liability under this Section shall not be increased because of
10 multiple motor vehicles covered under the same policy of
11 insurance. Insurers providing liability coverage on an excess
12 or umbrella basis are neither required to provide, nor are they
13 prohibited from offering or making available coverages
14 conforming to this Section on a supplemental basis.
15 Notwithstanding the provisions of this Section, an insurer
16 shall not be prohibited from solely providing a combination of
17 uninsured and underinsured motorist coverages where the limits
18 of liability under each coverage is in the same amount.
19     (6) Subrogation against underinsured motorists. No insurer
20 shall exercise any right of subrogation under a policy
21 providing additional uninsured motorist coverage against an
22 underinsured motorist where the insurer has been provided with
23 written notice in advance of a settlement between its insured
24 and the underinsured motorist and the insurer fails to advance
25 a payment to the insured, in an amount equal to the tentative
26 settlement, within 30 days following receipt of such notice.
27     (7) A policy which provides underinsured motor vehicle
28 coverage may include a clause which denies payment until the
29 limits of liability or portion thereof under all bodily injury
30 liability insurance policies applicable to the underinsured
31 motor vehicle and its operators have been partially or fully
32 exhausted by payment of judgment or settlement. A judgment or
33 settlement of the bodily injury claim in an amount less than
34 the limits of liability of the bodily injury coverages

 

 

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1 applicable to the claim shall not preclude the claimant from
2 making an underinsured motorist claim against the underinsured
3 motorist coverage. Any such provision in a policy of insurance
4 shall be inapplicable if the insured, or the legal
5 representative of the insured, and the insurer providing
6 underinsured motor vehicle coverage agree that the insured has
7 suffered bodily injury or death as the result of the negligent
8 operation, maintenance, or use of an underinsured motor vehicle
9 and, without arbitration, agree also on the amount of damages
10 that the insured is legally entitled to collect. The maximum
11 amount payable pursuant to such an underinsured motor vehicle
12 insurance settlement agreement shall not exceed the amount by
13 which the limits of the underinsured motorist coverage exceed
14 the limits of the bodily injury liability insurance of the
15 owner or operator of the underinsured motor vehicle. Any such
16 agreement shall be final as to the amount due and shall be
17 binding upon both the insured and the underinsured motorist
18 insurer regardless of the amount of any judgment, or any
19 settlement reached between any insured and the person or
20 persons responsible for the accident. No such settlement
21 agreement shall be concluded unless: (i) the insured has
22 complied with all other applicable policy terms and conditions;
23 and (ii) before the conclusion of the settlement agreement, the
24 insured has filed suit against the underinsured motor vehicle
25 owner or operator and has not abandoned the suit, or settled
26 the suit without preserving the rights of the insurer providing
27 underinsured motor vehicle coverage in the manner described in
28 paragraph (6) of this Section.
29 (Source: P.A. 89-658, eff. 1-1-97.)
 
30     Section 99. Effective date. This Act takes effect upon
31 becoming law.".