093_HB3661sam003

 










                                     LRB093 09245 RLC 15279 a

 1                    AMENDMENT TO HOUSE BILL 3661

 2        AMENDMENT NO.     .  Amend House Bill 3661,  AS  AMENDED,
 3    in  the  introductory  clause  of  Section  5,  by  replacing
 4    "245.25" with "143.17a, 245.25"; and

 5    in  Section  5, immediately below the introductory clause, by
 6    inserting the following:

 7        "(215 ILCS 5/143.17a) (from Ch. 73, par. 755.17a)
 8        Sec. 143.17a.  Notice of intention not to renew.
 9        a.  No  company  shall  fail  to  renew  any  policy   of
10    insurance,  to which Section 143.11 applies, except for those
11    defined in subsections (a), (b),  (c),  and  (h)  of  Section
12    143.13,  unless it shall send by mail to the named insured at
13    least 60 days advance notice of its intention not  to  renew.
14    The company shall maintain proof of mailing of such notice on
15    one  of  the  following forms:  a recognized U.S. Post Office
16    form or a form acceptable to the U.S. Post  Office  or  other
17    commercial  mail  delivery  service.   An exact and unaltered
18    copy of such notice shall  also  be  sent  to  the  insured's
19    broker, if known, or the agent of record and to the mortgagee
20    or  lien  holder  at  the  last  mailing address known by the
21    company. However, where cancellation  is  for  nonpayment  of
22    premium,  the  notice of cancellation must be mailed at least
 
                            -2-      LRB093 09245 RLC 15279 a
 1    10 days before the effective date of the cancellation.
 2        b.  This Section  does  not  apply  if  the  company  has
 3    manifested  its  willingness  to  renew directly to the named
 4    insured. Provided, however, that no company may increase  the
 5    renewal  premium  on any policy of insurance to which Section
 6    143.11 applies, except for those defined in subsections  (a),
 7    (b),  (c),  and  (h)  of  Section 143.13, by 30% or more, nor
 8    impose changes in deductibles  or  coverage  that  materially
 9    alter  the  policy,   unless the company shall have mailed or
10    delivered  to  the  named  insured  written  notice  of  such
11    increase or change in deductible or coverage at least 60 days
12    prior to the renewal or anniversary  date.  The  increase  in
13    premium  shall  be  the  renewal  premium  based on the known
14    exposure as of the date of  the  quotation  compared  to  the
15    premium as of the last day of coverage for the current year's
16    policy, annualized.  The premium on the renewal policy may be
17    subsequently  amended  to  reflect  any change in exposure or
18    reinsurance costs not considered in the quotation.  An  exact
19    and  unaltered  copy of such notice shall also be sent to the
20    insured's broker, if known, or the agent of  record.  If  the
21    company intends to increase the premium on a policy by 30% or
22    more  and  the  renewal date is less than 60 but more than 30
23    days away, then the company must extend  the  current  policy
24    under  the  same  terms,  conditions, and premium to allow 60
25    days notice of renewal and provide the actual renewal premium
26    quotation and any change in coverage  or  deductible  on  the
27    policy. Proof of mailing or proof of receipt may be proven by
28    a  sworn  affidavit  by  the  insurer  as  to  the  usual and
29    customary business practices of mailing  notice  pursuant  to
30    this  Section  or  may  be  proven  consistent  with Illinois
31    Supreme Court Rule 236. The company shall maintain  proof  of
32    mailing or proof of receipt whichever is required.
33        c.  Should  a  company  fail  to  comply  with the notice
34    requirements of this Section, the policy shall terminate only
 
                            -3-      LRB093 09245 RLC 15279 a
 1    as provided in this subsection. In the event of a nonrenewal,
 2    if a notice of nonrenewal is not provided at least  31  days,
 3    but  less than 60 days prior to expiration of the policy, the
 4    policy shall be extended for an additional year a  period  of
 5    60  days or until the effective date of any similar insurance
 6    procured by the insured, whichever is less, on the same terms
 7    and conditions as the policy sought to be terminated.  In the
 8    event notice is provided less  than  31  days  prior  to  the
 9    expiration  of the policy, the policy shall be extended for a
10    period of one year or until the effective date of any similar
11    insurance procured by the insured, whichever is less, on  the
12    same  terms  and  conditions  as  the  policy  sought  to  be
13    terminated  unless the insurer has manifested its willingness
14    to renew at  a  premium  which  represents  an  increase  not
15    exceeding  30%. The premium for coverage shall be prorated in
16    accordance with the amount of the last  year's  premium,  and
17    the  company  shall  be  entitled  to  this  premium  for the
18    extension of coverage and such extension  may  be  contingent
19    upon the payment of such premium.
20        d.  Renewal  of  a policy does not constitute a waiver or
21    estoppel with  respect  to  grounds  for  cancellation  which
22    existed before the effective date of such renewal.
23        e.  In  all  notices of intention not to renew any policy
24    of insurance, as defined in Section 143.11 the company  shall
25    provide a specific explanation of the reasons for nonrenewal.
26    (Source: P.A. 89-669, eff. 1-1-97.)"; and

27    at the end of the bill, by inserting the following:

28        "Section  99.   Effective date.  The changes made to Sec.
29    143.17a of the Illinois Insurance Code in Section 5  of  this
30    Act take effect upon becoming law.".