(215 ILCS 5/110) (from Ch. 73, par. 722)
(Section scheduled to be repealed on January 1, 2027)
Sec. 110.
Delivery
to director of application and documents.
There shall be delivered to the Director
(a) the application of the company for a certificate |
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(b) a copy of its articles of incorporation or
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| articles of association as amended, duly certified by the proper officer of the state or country under whose laws the company is organized or incorporated, or if a reciprocal or Lloyds the power of attorney of the attorney-in-fact;
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(c) if an alien company, a copy of the appointment
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| and authority of its United States manager, certified by a proper officer of the company;
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(d) a copy of its by-laws or regulations, and if a
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| fraternal benefit society, a copy of its constitution, certified by its secretary or officer corresponding thereto;
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(e) the instrument authorizing service of process on
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| the Director required by section 112;
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(f) a statement of its financial condition and
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| business as of the end of the preceding calendar year complying as to form, content and verification with the requirements of this Code for annual statements, or a financial statement as of such later date as the Director may require;
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(g) a copy of the last report of examination
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| certified to by an insurance commissioner or other proper supervisory official; and
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(h) a certificate from the proper official of the
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| state or country wherein it is incorporated or organized that it is duly incorporated or organized and is authorized to write the kind or kinds of insurance which it proposes to write in this State.
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(Source: Laws 1965, p. 422.)
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(215 ILCS 5/111) (from Ch. 73, par. 723)
(Section scheduled to be repealed on January 1, 2027)
Sec. 111.
Conditions of issuance of certificate of authority.
(1) Before a certificate of authority to transact business in this State
is issued to a foreign or alien company, such company shall satisfy the
Director that:
(a) the company is duly organized under the laws of |
| the state or country under whose laws it professes to be organized and authorized to do the business it is transacting or proposes to transact;
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(b) its name is not the same as, or deceptively
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| similar to, the name of any domestic company, or of any foreign or alien company authorized to transact business in this State;
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(c) if a company transacting business of the kind or
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| kinds enumerated in Class 1 of Section 4, it is not engaging in practices in any state which if engaged in this State, would constitute a violation of Section 237; and it is not transacting any kinds of business other than those enumerated in Class 1 of Section 4;
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(d) if a stock company, it has a paid up capital and
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| surplus at least equal to the capital and original surplus required by this Code for a domestic company doing the same kind or kinds of business or, if a mutual company or reciprocal, it has a surplus and provision for contingent liability of policyholders, at least equal to the original surplus and provision for contingent liability of policyholders required for a similar domestic company doing the same kind or kinds of business, or, if a fraternal benefit society, it meets the requirements prescribed in this Code for the organization of a domestic company or society, or if a Lloyds it meets the requirements of Article V;
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(e) its funds are invested in accordance with the
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| laws of its domicile; and
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(f) in the case of a stock company its minimum
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| capital and surplus and required reserves, or in the case of a mutual company or a reciprocal proposing to issue policies without contingent liability, its minimum surplus and required reserves, or in the case of any other company, all its funds, are invested in securities or property which afford a degree of financial security equal to that required for similar domestic companies, provided that this clause shall not be construed as requiring the application of limitations relating either to the kind or amount of securities prescribed by this Code for the investments of domestic companies.
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(2) In determining whether an alien company complies with the provisions
of subsection (1) of this section the Director shall consider only business
transacted in the United States, only the assets described in Section 60j
and only liabilities in connection with its United States business.
(3) Before a certificate of authority is issued to a foreign or alien
company, other than a Lloyds, it shall deposit with the Director securities
which are authorized investments for similar domestic companies under
Section 126.11A(1), 126.11A(2), 126.24A(1), or 126.24A(2) of
the amount, if any, required of a domestic company
similarly organized and doing the same kind or kinds of business; or in
lieu of such deposit such foreign or alien company shall satisfy the
Director that it has on deposit with an official of a state of the United
States or a depositary designated or authorized for such purpose by such
official, authorized by the law of such state to accept such deposit,
securities of at least a like amount, for the benefit and security of all
creditors, policyholders and policy obligations of such company.
(4) Before issuing a certificate of authority to a foreign or alien
company, the Director may cause an examination to be made of the condition
and affairs of such company.
(Source: P.A. 90-418, eff. 8-15-97; 90-794, eff. 8-14-98.)
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(215 ILCS 5/113.1) (from Ch. 73, par. 725.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 113.1.
Effect of acceptance of certificate of authority.
(1) No foreign or alien company which accepts a certificate of authority
or renewal certificate of authority to transact in this State any insurance
business as described in Section 4 of this Code shall transfer by sale,
contribution, merger, consolidation, reinsurance or otherwise, its direct
policy obligations under insurance contracts with Illinois policyholders
unless:
a. the transfer is made to a company authorized to |
| transact in this State the type of insurance business transferred; or
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b. the transferring company gives 30 days prior
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| written notice to each policyholder to be transferred stating that the insurance contract and the company's liabilities thereunder are to be transferred to a specified insurer which is not subject to regulation by the Illinois Insurance Department or the administrative requirements of the Illinois Insurance Code; and
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c. the unauthorized company to which the insurance
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| business is to be transferred makes and maintains a special deposit with the Director for the protection and benefit of all Illinois policyholders of such unauthorized company, in assets acceptable to the Director and having a fair market value not less than the required statutory reserves for the Illinois insurance business to be transferred.
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(2) Any and all transfers resulting in the violation of this Section
shall be construed as a violation of all applicable provisions of Article
VII of this Code; including, but not limited to, Section 121-4 providing
for liability to insureds for claims or insured losses not honored by the
unauthorized insurer.
(3) Unless permitted by and obtained in compliance with this Section, or
specifically authorized by another provision of this Code, it shall be
unlawful for any unauthorized company to obtain as direct insurer any
insurance contracts written in this State.
(Source: P.A. 86-753.)
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(215 ILCS 5/114) (from Ch. 73, par. 726)
(Section scheduled to be repealed on January 1, 2027)
Sec. 114.
Renewal of
certificate of authority.
(1) The Director shall renew for one year the certificate of authority
of a foreign or alien company on the first day of July of the calendar year
following the calendar year in which it is admitted to transact business in
this State and annually thereafter, without application by the company,
upon payment of the annual privilege tax imposed by this Code, if any,
provided the Director is satisfied that
(a) none of the facts specified in this article as |
| grounds for revoking a certificate of authority exists; and
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(b) the company is complying with the conditions for
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| admission in respect to capital, contingent liability, the investment of its assets or the maintenance of deposits in this or another state and maintains the surplus which similar domestic companies transacting the same kind or kinds of business are required to maintain.
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(2) Except in case of nonpayment of taxes, the Director shall give
notice of his intention to refuse to renew the certificate of authority of
a foreign or alien company and the grounds therefor at least twenty days
before the end of the term for which the existing certificate was issued,
and, the company shall be given an opportunity for a hearing before the end
of such term.
(3) In the event that a company admitted to transact business in this
State prior to the effective date of this Code has been and is transacting
in this State or in any other state or country the kind or kinds of
business enumerated in Class 1 of Section 4 and in addition thereto any of
the kinds of business not enumerated in such class, the Director may for a
period of three years renew annually its certificate of authority to
transact such kinds of business. At the end of such three year period or at
the end of any extended period as herein provided for, the Director may
extend the period during which the certificate of authority of such company
may be renewed annually, upon a showing by the company at a hearing before
the Director that
(a) it has made reasonable progress in the
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| discontinuance of kinds of business other than those enumerated in Class 1 of Section 4; and
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(b) complete and immediate discontinuance of such
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| kinds of business would result in undue loss to the company and the policyholders would suffer materially thereby; or
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(c) there are other reasons for such extension deemed
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| by the Director to be good and sufficient. The extension herein provided for shall be for such period as the Director may deem proper on the showing made, but the total of such extended periods shall not exceed three years.
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(Source: P.A. 82-498.)
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(215 ILCS 5/117) (from Ch. 73, par. 729)
(Section scheduled to be repealed on January 1, 2027)
Sec. 117.
Merger or
consolidation.
(1) Whenever a foreign or alien company authorized to transact business
in this State shall be the surviving company of a statutory merger
permitted by the laws of the state or country under which it is organized,
and such merger is not subject to the provisions of Article X; it shall
forthwith file with the Director
(a) copies of the agreement and certificate of merger |
| duly authenticated by the proper officer of the state or country under the laws of which such statutory merger was effected; and
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(b) if any of the companies party to such merger were
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| not admitted to transact business in this State, a statement of the financial condition and business of each of such companies, as of the end of the preceding calendar year complying as to form, content and verification with the requirements of this Code for annual statements, or a financial statement as of such later date as the Director may require.
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(2) It shall not be necessary for such surviving company to procure a
new certificate of authority to transact business in this State nor an
amended certificate unless the name of such company be changed thereby or
unless the company desires to transact in this State a kind or kinds of
business other than those which it is then authorized to transact.
(3) Whenever a foreign or alien company authorized to transact business
in this State shall be a party to a statutory merger and such company shall
not be the surviving company, or if such foreign or alien company shall be
a party to a consolidation, then the certificate of authority of such
foreign or alien company shall terminate upon such merger or consolidation,
and the surviving company, if not previously authorized to transact
business in this State, or the new company, in the case of consolidation,
shall be subject to the same requirements for admission to transact
business in this State as any other foreign or alien company.
(Source: Laws 1937, p. 696.)
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(215 ILCS 5/118) (from Ch. 73, par. 730)
(Section scheduled to be repealed on January 1, 2027)
Sec. 118.
Withdrawal
from the State.
(1) Any foreign or alien company admitted to do business in this State
may withdraw from this State by filing with the Director a statement of
withdrawal, signed and verified by a president, vice-president or an
executive officer corresponding thereto, or in the case of a reciprocal or
Lloyds, by the attorney-in-fact, and setting forth
(a) that the company surrenders its authority to |
| transact business in this State and returns for cancellation its certificate of authority;
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(b) except in the case of a reciprocal or Lloyds,
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| that the withdrawal of the company from this State has been duly authorized by the board of directors, trustees or other governing body of such company; and
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(c) a postoffice address to which the Director may
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| mail a copy of any process against the withdrawing company that may be served upon him.
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(2) Upon the filing of such statement together with its certificate of
authority with the Director and payment of any taxes or charges that may be
due, the Director shall cancel the certificate of authority and return the
cancelled certificate to the company. The authority of the company to
transact business in this State shall thereupon cease.
(Source: Laws 1937, p. 696.)
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(215 ILCS 5/119) (from Ch. 73, par. 731)
(Section scheduled to be repealed on January 1, 2027)
Sec. 119.
Revocation and suspension of certificate of authority.
(1) The Director may revoke or suspend the certificate of authority of a
foreign or alien company or may by order require such insurance company to
pay to the people of the State of Illinois a penalty in a sum not exceeding
$500, and upon the failure of such insurance company to pay such penalty
within 20 days after the mailing of such order, postage prepaid, certified or
registered, and addressed to the last known place of business of such
insurance company, unless such order is stayed by an order of a court of
competent jurisdiction, the Director of Insurance may revoke or suspend the
license of such insurance company for any period of time up to, but not
exceeding a period of, 2 years whenever he finds that such company
(a) is insolvent;
(b) fails to comply with the requirements for |
| admission in respect to capital, contingent liability, the investment of its assets or the maintenance of deposits in this or another state or fails to maintain the surplus which similar domestic companies transacting the same kind or kinds of business are required to maintain;
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(c) is in such a financial condition that its further
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| transaction of business in this State would be hazardous to policyholders and creditors in this State and to the public;
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(d) has refused or neglected to pay a valid final
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| judgment against such company within 30 days after the rendition of such judgment;
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(e) has violated any law of this State or has in this
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| State violated its charter or exceeded its corporate powers;
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(f) has refused to submit its books, papers,
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| accounts, records, or affairs to the reasonable inspection or examination of the Director, his actuaries, deputies or examiners;
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(g) has an officer who has refused upon reasonable
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| demand to be examined under oath touching its affairs;
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(h) fails to file its annual statement within 30 days
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| after the date when it is required by law to file such statement;
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(i) fails to file with the Director a copy of an
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| amendment to its charter or articles of association within 30 days after the effective date of such amendment;
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(j) fails to file with the Director copies of the
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| agreement and certificate of merger and the financial statements of the merged companies, if required, within 30 days after the effective date of the merger;
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(k) fails to pay any fees, taxes or charges
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| prescribed by this Code within 30 days after they are due and payable; provided, however, that in case of objection or legal contest the company shall not be required to pay the tax until 30 days after final disposition of the objection or legal contest.
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(l) fails to file any report or reports for the
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| purpose of enabling the Director to compute the taxes to be paid by such company within 30 days after the date when it is required by law to file such report or reports;
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(m) has had its corporate existence dissolved or its
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| certificate of authority revoked in the state in which it was organized; or
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(n) has had all its risks reinsured in their entirety
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(2) Except for the grounds stated in clauses (a), (c) or (k) of
subsection (1) of this section the Director shall not revoke or suspend the
certificate of authority of a foreign or alien company until he has given
the company at least twenty days' notice of the revocation or suspension
and of the grounds therefor and has afforded the company an opportunity for
a hearing.
(Source: P.A. 83-598.)
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(215 ILCS 5/121-1) (from Ch. 73, par. 733-1)
Sec. 121-1.
Purpose of Article.
The purpose of this Article is to subject certain insurers to the
jurisdiction of the Director of Insurance and the courts of this State in
suits by or on behalf of the State. The General Assembly declares that it
is concerned with the protection of residents of this State against acts by
insurers not authorized to do an insurance business in this State, by the
maintenance of fair and honest insurance markets, by protecting authorized
insurers which are subject to regulation from unfair competition by
unauthorized insurers, and by protecting against the evasion of the
insurance regulatory laws of this State. In furtherance of this State
interest, the General Assembly in this Article provides methods for
substituted service of process upon such insurers in any proceeding, suit
or action in any court and substituted service of any notice, order,
pleading or process upon such insurers in any proceeding by the Director of
Insurance to enforce or effect full compliance with the insurance laws of
this State. In so doing, the State exercises its powers to protect its
residents and to define what constitutes transacting an insurance business
in this State, and also exercises powers and privileges available to this
State under Public Law 79-15, 79th Congress of the United States, Chapter
20, 1st Sess., S. 340, 59 Stat. 33; 15 U.S.C. 1011 through 1015, as
amended, which declares that the business of insurance and every person
engaged therein shall be subject to the laws of the several states.
(Source: P.A. 77-1565.)
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(215 ILCS 5/121-2.08) (from Ch. 73, par. 733-2.08)
Sec. 121-2.08. Transactions in this State involving contracts of
insurance independently procured directly from an unauthorized insurer by industrial insureds. (a) As used in this Section: "Exempt commercial purchaser" means exempt commercial purchaser as the term is defined in subsection (1) of Section 445 of this Code. "Home state" means home state as the term is defined in subsection (1) of Section 445 of this Code. "Industrial insured" means an insured:
(i) that procures the insurance of any risk or risks |
| of the kinds specified in Classes 2 and 3 of Section 4 of this Code by use of the services of a full-time employee who is a qualified risk manager or the services of a regularly and continuously retained consultant who is a qualified risk manager;
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(ii) that procures the insurance directly from an
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| unauthorized insurer without the services of an intermediary insurance producer; and
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(iii) that is an exempt commercial purchaser whose
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"Insurance producer" means insurance producer as the term is defined in Section 500-10 of this Code.
"Qualified risk manager" means qualified risk manager as the term is defined in subsection (1) of Section 445 of this Code.
"Safety-Net Hospital" means an Illinois hospital that qualifies as a Safety-Net Hospital under Section 5-5e.1 of the Illinois Public Aid Code.
"Unauthorized insurer" means unauthorized insurer as the term is defined in subsection (1) of Section 445 of this Code.
(b) For contracts of insurance effective January 1, 2015 or later, within 90 days after the effective date of each contract of insurance issued under this Section, the insured shall file a report with the Director by submitting the report to the Surplus Line Association of Illinois in writing or in a computer readable format and provide information as designated by the Surplus Line Association of Illinois. The information in the report shall be substantially similar to that required for surplus line submissions as described in subsection (5) of Section 445 of this Code. Where applicable, the report shall satisfy, with respect to the subject insurance, the reporting requirement of Section 12 of the Fire Investigation Act.
(c) For contracts of insurance effective January 1, 2015 through December 31, 2017, within 30 days after filing the report, the insured shall pay to the Director for the use and benefit of the State a sum equal to the gross premium of the contract of insurance multiplied by the surplus line tax rate, as described in paragraph (3) of subsection (a) of Section 445 of this Code, and shall pay the fire marshal tax that would otherwise be due annually in March for insurance subject to tax under Section 12 of the Fire Investigation Act. For contracts of insurance effective January 1, 2018 or later, within 30 days after filing the report, the insured shall pay to the Director for the use and benefit of the State a sum equal to 0.5% of the gross premium of the contract of insurance, and shall pay the fire marshal tax that would otherwise be due annually in March for insurance subject to tax under Section 12 of the Fire Investigation Act. For contracts of insurance effective January 1, 2015 or later, within 30 days after filing the report, the insured shall pay to the Surplus Line Association of Illinois a countersigning fee that shall be assessed at the same rate charged to members pursuant to subsection (4) of Section 445.1 of this Code.
(d) For contracts of insurance effective January 1, 2015 or later, the insured shall withhold the amount of the taxes and countersignature fee from the amount of premium charged by and otherwise payable to the insurer for the insurance. If the insured fails to withhold the tax and countersignature fee from the premium, then the insured shall be liable for the amounts thereof and shall pay the amounts as prescribed in subsection (c) of this Section.
(e) Contracts of insurance with an industrial insured that qualifies as a Safety-Net Hospital are not subject to subsections (b) through (d) of this Section.
(Source: P.A. 100-535, eff. 9-22-17; 100-1118, eff. 11-27-18.)
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(215 ILCS 5/121-3) (from Ch. 73, par. 733-3)
Sec. 121-3.
Transaction of insurance business defined.
Any of the following acts in this State, effected by mail or otherwise
by or on behalf of an unauthorized insurer, constitutes the transaction of
an insurance business in this State.
(a) The making of or proposing to make, as an insurer, an insurance
contract.
(b) The making of or proposing to make, as guarantor or surety, any
contract of guaranty or suretyship as a vocation and not merely incidental
to any other legitimate business or activity of the guarantor or surety.
(c) The taking or receiving of any application for insurance.
(d) The receiving or collection of any premium, commission, membership
fees, assessments, dues or other consideration for any insurance or any
part thereof.
(e) The issuance or delivery of contracts of insurance to residents of
this State or to persons authorized to do business in this State.
(f) Directly or indirectly acting as an agent for or otherwise
representing or aiding on behalf of another any person or insurer in the
solicitation, negotiation, procurement or effectuation of insurance or
renewals thereof or in the dissemination of information as to coverage or
rates, or forwarding of applications, or delivery of policies or contracts,
or inspection of risks, a fixing of rates or investigation or adjustment of
claims or losses or in the transaction of matters subsequent to
effectuation of the contract and arising out of that contract, or in any
other manner representing or assisting a person or insurer in the
transaction of insurance with respect to subjects of insurance resident,
located or to be performed in this State. This paragraph does not prohibit
full-time salaried employees of a corporate insured from acting in the
capacity of an insurance manager or buyer in placing insurance in behalf of
that employer.
(g) The transaction of any kind of insurance business specifically
recognized as transacting an insurance business within the meaning of this
Act.
(h) The transacting or proposing to transact any insurance business in
substance equivalent to any of the foregoing in a manner designed to evade
this Act.
The venue of an act committed by mail is at the point where the matter
transmitted by mail is delivered and takes effect. Unless otherwise
indicated, the term "insurer" as used in this Article includes all
corporations, associations, partnerships and individuals, engaged as
principals in the business of insurance and also includes interinsurance
exchanges and mutual benefit societies.
(Source: P.A. 77-1565.)
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(215 ILCS 5/121-6) (from Ch. 73, par. 733-6)
Sec. 121-6.
Acts constituting Secretary of State as agent for process.
Any act of transacting an insurance business, as set forth in Section
121-3; by any unauthorized insurer constitutes an irrevocable appointment
by that insurer, binding upon him, his executor or administrator, or
successor in interest if a corporation, of the Secretary of State, to be
the true and lawful attorney of such insurer upon whom may be served all
lawful process in any action, suit, or proceeding in any court by the
Director or by the State and upon whom may be served any notice, order,
pleading or process in any proceeding before the Director which arises out
of transacting an insurance business in this State by that insurer. Any act
of transacting an insurance business in this State by any unauthorized
insurer signifies its agreement that any lawful process in such a court
action, suit, or proceeding and any such notice, order, pleading, or
process in an administrative proceeding before the Director so served shall
be of the same legal force and validity as personal service of process in
this State upon that insurer.
(Source: P.A. 77-1565.)
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(215 ILCS 5/121-7) (from Ch. 73, par. 733-7)
Sec. 121-7.
Service of process - notice.
Service of process in an action described in Section 121-6 shall be made
by delivering to and leaving with the Secretary of State, or some person in
apparent charge of his office, 2 copies thereof and by payment to the
Secretary of State of the fee prescribed by law. Service upon the Secretary
of State as such attorney shall be service upon the principal.
The Secretary of State shall forthwith forward by certified mail one of
the copies of the process or notice, order, pleading, or process in
proceedings before the Director to the defendant in such court proceeding
or to whom the notice, order, pleading, or process in such administrative
proceeding is addressed or directed at its last known principal place of
business and shall keep a record of all process so served on him which
shall show the day and hour of service. Such service is sufficient if:
(a) Notice of such service and a copy of the court process or the
notice, order, pleading, or process in such administrative proceeding are
sent within 10 days thereafter by certified mail by the plaintiff or the
plaintiff's attorney in the court proceeding, or by the Director of
Insurance in the administrative proceeding, to the defendant in the court
proceeding or to whom the notice, order, pleading, or process in such
administrative proceeding is addressed or directed at the last known
principal place of business of the defendant in the court or administrative
proceeding.
(b) The defendant's receipt or receipts issued by the post office with
which the letter is registered, showing the name of the sender of the
letter and the name and address of the person or insurer to whom the letter
is addressed, and an affidavit of the plaintiff or the plaintiff's attorney
in a court proceeding or of the Director in an administrative proceeding,
showing compliance therewith are filed with the clerk of the court in which
such action, suit, or proceeding is pending or with the Director in
administrative proceedings, by the date the defendant in the court or
administrative proceeding is required to appear or respond thereto, or
within such further time as the court or Director, as the case may be, may
allow.
(Source: P.A. 77-1565.)
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