IL
Illinois Senate Bill SB3213

Illinois 2023-2024 Regular Session

Illinois Senate Bill SB3213 Compare Versions

Only one version of the bill is available at this time.
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11 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3213 Introduced 2/6/2024, by Sen. Javier L. Cervantes SYNOPSIS AS INTRODUCED: 215 ILCS 5/143.19.4 new Amends the Illinois Insurance Code. Provides that the amendatory Act may be referred to as the Motor Vehicle Insurance Fairness Act. Provides that no insurer shall refuse to issue or renew a policy of automobile insurance based in whole or in part on specified prohibited underwriting or rating factors. Sets forth factors that are prohibited with respect to underwriting and rating a policy of automobile insurance. Sets forth provisions concerning the use of territorial factors. Provides that every insurer selling a policy of automobile insurance in the State shall demonstrate that its marketing, underwriting, rating, claims handling, fraud investigations, and any algorithm or model used for those business practices do not disparately impact any group of customers based on race, color, national or ethnic origin, religion, sex, sexual orientation, disability, gender identity, or gender expression. Provides that no rate shall be approved or remain in effect that is excessive, inadequate, unfairly discriminatory, or otherwise in violation of the provisions. Provides that every insurer that desires to change any rate shall file a complete rate application with the Director of Insurance. Provides that all information provided to the Director under the provisions shall be available for public inspection. Provides that any person may initiate or intervene in any proceeding permitted or established under the provisions and challenge any action of the Director under the provisions. Provides that the Department of Insurance shall adopt rules. Provides that all insurers subject to the provisions shall be assessed a fee of 0.05% of their total earned premium from the prior calendar year, and that the fee shall be payable to the Department no later than July 1 of each calendar year and shall be used by the Department to implement the provisions. LRB103 38653 RPS 68790 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3213 Introduced 2/6/2024, by Sen. Javier L. Cervantes SYNOPSIS AS INTRODUCED: 215 ILCS 5/143.19.4 new 215 ILCS 5/143.19.4 new Amends the Illinois Insurance Code. Provides that the amendatory Act may be referred to as the Motor Vehicle Insurance Fairness Act. Provides that no insurer shall refuse to issue or renew a policy of automobile insurance based in whole or in part on specified prohibited underwriting or rating factors. Sets forth factors that are prohibited with respect to underwriting and rating a policy of automobile insurance. Sets forth provisions concerning the use of territorial factors. Provides that every insurer selling a policy of automobile insurance in the State shall demonstrate that its marketing, underwriting, rating, claims handling, fraud investigations, and any algorithm or model used for those business practices do not disparately impact any group of customers based on race, color, national or ethnic origin, religion, sex, sexual orientation, disability, gender identity, or gender expression. Provides that no rate shall be approved or remain in effect that is excessive, inadequate, unfairly discriminatory, or otherwise in violation of the provisions. Provides that every insurer that desires to change any rate shall file a complete rate application with the Director of Insurance. Provides that all information provided to the Director under the provisions shall be available for public inspection. Provides that any person may initiate or intervene in any proceeding permitted or established under the provisions and challenge any action of the Director under the provisions. Provides that the Department of Insurance shall adopt rules. Provides that all insurers subject to the provisions shall be assessed a fee of 0.05% of their total earned premium from the prior calendar year, and that the fee shall be payable to the Department no later than July 1 of each calendar year and shall be used by the Department to implement the provisions. LRB103 38653 RPS 68790 b LRB103 38653 RPS 68790 b A BILL FOR
22 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3213 Introduced 2/6/2024, by Sen. Javier L. Cervantes SYNOPSIS AS INTRODUCED:
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55 Amends the Illinois Insurance Code. Provides that the amendatory Act may be referred to as the Motor Vehicle Insurance Fairness Act. Provides that no insurer shall refuse to issue or renew a policy of automobile insurance based in whole or in part on specified prohibited underwriting or rating factors. Sets forth factors that are prohibited with respect to underwriting and rating a policy of automobile insurance. Sets forth provisions concerning the use of territorial factors. Provides that every insurer selling a policy of automobile insurance in the State shall demonstrate that its marketing, underwriting, rating, claims handling, fraud investigations, and any algorithm or model used for those business practices do not disparately impact any group of customers based on race, color, national or ethnic origin, religion, sex, sexual orientation, disability, gender identity, or gender expression. Provides that no rate shall be approved or remain in effect that is excessive, inadequate, unfairly discriminatory, or otherwise in violation of the provisions. Provides that every insurer that desires to change any rate shall file a complete rate application with the Director of Insurance. Provides that all information provided to the Director under the provisions shall be available for public inspection. Provides that any person may initiate or intervene in any proceeding permitted or established under the provisions and challenge any action of the Director under the provisions. Provides that the Department of Insurance shall adopt rules. Provides that all insurers subject to the provisions shall be assessed a fee of 0.05% of their total earned premium from the prior calendar year, and that the fee shall be payable to the Department no later than July 1 of each calendar year and shall be used by the Department to implement the provisions.
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1111 1 AN ACT concerning regulation.
1212 2 Be it enacted by the People of the State of Illinois,
1313 3 represented in the General Assembly:
1414 4 Section 1. This Act may be referred to as the Motor Vehicle
1515 5 Insurance Fairness Act.
1616 6 Section 5. The Illinois Insurance Code is amended by
1717 7 adding Section 143.19.4 as follows:
1818 8 (215 ILCS 5/143.19.4 new)
1919 9 Sec. 143.19.4. Motor vehicle insurance fairness.
2020 10 (a) Definition. As used in this Section, "proceeding"
2121 11 includes the filing of any rate, rule, or form and any
2222 12 rulemaking conducted pursuant to this Section.
2323 13 (b) Prohibitions; refusal to insure.
2424 14 (1) No insurer shall refuse to issue or renew a policy
2525 15 of automobile insurance, bond, or any other insurance
2626 16 based on the ownership or operation of a motor vehicle
2727 17 based in whole or in part on any of the prohibited
2828 18 underwriting and rating factors set forth in subsection
2929 19 (c), or use those factors to determine the terms of
3030 20 coverage or placement in a particular affiliate within an
3131 21 insurance company group.
3232 22 (2) Classification plans, rating plans, rating tier
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3636 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3213 Introduced 2/6/2024, by Sen. Javier L. Cervantes SYNOPSIS AS INTRODUCED:
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3939 Amends the Illinois Insurance Code. Provides that the amendatory Act may be referred to as the Motor Vehicle Insurance Fairness Act. Provides that no insurer shall refuse to issue or renew a policy of automobile insurance based in whole or in part on specified prohibited underwriting or rating factors. Sets forth factors that are prohibited with respect to underwriting and rating a policy of automobile insurance. Sets forth provisions concerning the use of territorial factors. Provides that every insurer selling a policy of automobile insurance in the State shall demonstrate that its marketing, underwriting, rating, claims handling, fraud investigations, and any algorithm or model used for those business practices do not disparately impact any group of customers based on race, color, national or ethnic origin, religion, sex, sexual orientation, disability, gender identity, or gender expression. Provides that no rate shall be approved or remain in effect that is excessive, inadequate, unfairly discriminatory, or otherwise in violation of the provisions. Provides that every insurer that desires to change any rate shall file a complete rate application with the Director of Insurance. Provides that all information provided to the Director under the provisions shall be available for public inspection. Provides that any person may initiate or intervene in any proceeding permitted or established under the provisions and challenge any action of the Director under the provisions. Provides that the Department of Insurance shall adopt rules. Provides that all insurers subject to the provisions shall be assessed a fee of 0.05% of their total earned premium from the prior calendar year, and that the fee shall be payable to the Department no later than July 1 of each calendar year and shall be used by the Department to implement the provisions.
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6767 1 placement factors, scoring models, rules, rates, premiums,
6868 2 or any other method of establishing the premium to be paid
6969 3 by an automobile insurance policyholder or covered driver,
7070 4 and the modification thereof, based in whole or in part on
7171 5 any of the prohibited underwriting and rating factors in
7272 6 subsection (c) are unfairly discriminatory.
7373 7 (c) Prohibited factors. With respect to underwriting and
7474 8 rating a policy of automobile insurance, the use of the
7575 9 following factors shall be prohibited:
7676 10 (1) sex or gender;
7777 11 (2) marital status;
7878 12 (3) race;
7979 13 (4) creed;
8080 14 (5) national origin;
8181 15 (6) religion;
8282 16 (7) age;
8383 17 (8) employment or occupation;
8484 18 (9) education level attained;
8585 19 (10) home ownership;
8686 20 (11) consumer credit information or other credit-based
8787 21 score;
8888 22 (12) the absence of prior insurance;
8989 23 (13) the amount or provider of prior insurance
9090 24 coverage;
9191 25 (14) any measure of a consumer's price elasticity of
9292 26 demand;
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103103 1 (15) the zip code, or any territorial designation
104104 2 geographically smaller than the zip code, in which the
105105 3 policyholder resides; and
106106 4 (16) the level of income or wealth.
107107 5 (d) Years of driving experience. Notwithstanding item (7)
108108 6 of subsection (c), an insurer may consider the number of years
109109 7 of driving experience of an applicant for the purposes of
110110 8 underwriting and rating.
111111 9 (e) Territory or any other geographical characteristic.
112112 10 Territory or any other geographical characteristic shall not
113113 11 be considered for the purposes of underwriting a policy of
114114 12 automobile insurance, including, but not limited to, any
115115 13 decision to sell, refuse to sell, cancel, or non-renew, and
116116 14 the terms of the policy of automobile insurance.
117117 15 Notwithstanding item (15) of subsection (c), an insurer may,
118118 16 for rating purposes, use a territorial factor that is not
119119 17 prohibited if the territorial factor does not have more than a
120120 18 25% impact on the premium that would otherwise be charged.
121121 19 (f) Prohibited business practices. Every insurer selling a
122122 20 policy of automobile insurance in Illinois shall demonstrate
123123 21 that its marketing, underwriting, rating, claims handling,
124124 22 fraud investigations, and any algorithm or model used for
125125 23 those business practices do not disparately impact any group
126126 24 of customers based on race, color, national or ethnic origin,
127127 25 religion, sex, sexual orientation, disability, gender
128128 26 identity, or gender expression.
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139139 1 (g) Prior approval of rates.
140140 2 (1) No rate shall be approved or remain in effect that
141141 3 is excessive, inadequate, unfairly discriminatory, or
142142 4 otherwise in violation of this Section. In considering
143143 5 whether a rate is excessive, inadequate, or unfairly
144144 6 discriminatory, no consideration shall be given to the
145145 7 degree of competition, and the Director shall consider
146146 8 whether the rate mathematically reflects the insurance
147147 9 company's investment income.
148148 10 (2) Every insurer that desires to change any rate
149149 11 shall file a complete rate application with the Director.
150150 12 A complete rate application shall include all data
151151 13 necessary to justify the proposed rate and such other
152152 14 information as the Director may require. The applicant
153153 15 shall have the burden of proving that the requested rate
154154 16 change is justified and meets the requirements of this
155155 17 Section.
156156 18 (3) The Director shall notify the public of any
157157 19 application by an insurer for a rate change. The
158158 20 application shall be deemed approved 60 days after public
159159 21 notice unless:
160160 22 (A) the Director disapproves the application;
161161 23 (B) a consumer or the consumer's representative
162162 24 requests a hearing within 45 days after the public
163163 25 notice and the Director grants the hearing, or the
164164 26 Director determines not to grant the hearing and
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175175 1 issues written findings in support of that decision;
176176 2 or
177177 3 (C) the Director, on the Director's own motion,
178178 4 determines to hold a hearing. If the proposed rate
179179 5 adjustment exceeds 7% of the then-applicable rate for
180180 6 personal lines insurance or 15% for commercial lines
181181 7 insurance, then the Director must hold a hearing upon
182182 8 a timely request. If the application is incomplete or
183183 9 otherwise subject to disapproval, then the Director
184184 10 may extend the application review process by up to 60
185185 11 days with the agreement of the applicant.
186186 12 (h) Right of the public to inspect rates. All information
187187 13 provided to the Director pursuant to this Section shall be
188188 14 available for public inspection.
189189 15 (i) Right of the public to participate.
190190 16 (1) Any person may initiate or intervene in any
191191 17 proceeding permitted or established pursuant to this
192192 18 Section and challenge any action of the Director under
193193 19 this Section.
194194 20 (2) The Director or a court shall award reasonable
195195 21 advocacy and witness fees and expenses to any person who
196196 22 demonstrates that the person represents the interests of
197197 23 consumers and that the person made a substantial
198198 24 contribution to the adoption of any order, regulation, or
199199 25 decision by the Director or a court. Where such advocacy
200200 26 occurs in response to a rate application, the award shall
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211211 1 be paid by the applicant.
212212 2 (h) Rules.
213213 3 (1) The Department shall, no later than 90 days after
214214 4 the effective date of this amendatory Act of the 103rd
215215 5 General Assembly, adopt rules that guide the filing and
216216 6 approval of rates, rules, and forms pursuant to this
217217 7 Section. The Director shall develop formulas for
218218 8 evaluating rates and any rules or forms that impact rates
219219 9 that will be used to determine whether to approve or
220220 10 disapprove any filing.
221221 11 (2) Until the rules described in paragraph (1) take
222222 12 effect, no insurer may file for a change in any rate, rule,
223223 13 or form that would result in a rate increase. If, before
224224 14 the adoption of the rules described in paragraph (1), an
225225 15 insurer asserts that it would not be able to earn a
226226 16 reasonable rate of return without an increase, then it may
227227 17 request a hearing. If it is determined after a hearing
228228 18 that a rate increase is needed to earn a reasonable rate of
229229 19 return, then the insurer shall be allowed to make a change
230230 20 that affords it the minimum increase required to earn a
231231 21 reasonable rate of return.
232232 22 (3) The Department shall, no later than 180 days after
233233 23 the effective date of this amendatory Act of the 103rd
234234 24 General Assembly, adopt rules that implement the testing
235235 25 of insurer business practices for compliance with this
236236 26 Section.
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