State of Illinois
92nd General Assembly

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 1        AN ACT relating to insurance.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  Illinois  Insurance  Code is amended by
 5    changing Section 551 as follows:

 6        (215 ILCS 5/551) (from Ch. 73, par. 1065.101)
 7        Sec. 551.  Mandatory stay of proceedings. All proceedings
 8    in which the insolvent  insurer  is  either  a  party  or  is
 9    obligated  to  defend  a  party  in  any  court in this State
10    arising out of a claim under a policy of insurance written by
11    an insolvent company shall be automatically  stayed  for  120
12    days  (and  any  such  additional  time  thereafter as may be
13    determined to be appropriate by the trial court  in  which  a
14    given  case  is  pending)  from  the date of the entry of the
15    Order of Liquidation to permit proper defense by the Fund, or
16    a similar organization in another state, of all such  pending
17    causes of action. The automatic 120-day stay provided in this
18    Section  may be implemented in the following fashion: (1) for
19    cases  in  any  federal  court  sitting  in  this  State,  in
20    accordance with the applicable federal  rules  of  procedure,
21    including  any  applicable  local rules; or (2) for all cases
22    within a Judicial Circuit of the Circuit Court, by a  general
23    order  to  be  issued  upon  the filing by the Fund or by any
24    insured of the insolvent company of  a  suggestion  with  the
25    Chief    Judge   or   equivalent   judicial   official   with
26    administrative powers in each  Judicial  Circuit,  containing
27    appropriate   verification  of  the  entry  of  an  Order  of
28    Liquidation against the insolvent insurer.
29    (Source: P.A. 92-77, eff. 7-12-01.)

30        Section 99.  Effective date.  This Act takes effect  upon
                            -2-                LRB9214930JSpc
 1    becoming law.

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