99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB1805
 
Introduced 2/20/2015, by Sen. William R. Haine
 
SYNOPSIS AS INTRODUCED:



215 ILCS 5/155.44 new

 Amends the Illinois Insurance Code. Provides that any insurer with less than $100,000,000 in group surplus authorized to issue workers' compensation policies with a per-occurrence deductible of $100,000 or greater shall report the outstanding obligations owed under the deductible as liabilities of the insurer, unless the obligation is fully collateralized, and limit per-occurrence deductible obligations. Effective July 1, 2015.



LRB099 09021 MLM 29204 b


 
 
A BILL FOR
 


SB1805LRB099 09021 MLM 29204 b



1 AN ACT concerning insurance.


2 Be it enacted by the People of the State of Illinois,

3represented in the General Assembly:



4 Section 5. The Illinois Insurance Code is amended by adding 
5Section 155.44 as follows:

6 (215 ILCS 5/155.44 new)
7 Sec. 155.44. Financial requirements; large deductible 
8workers' compensation policies and programs. Any insurer with 
9less than $100,000,000 in group surplus authorized to issue 
10workers' compensation policies with a per-occurrence 
11deductible of $100,000 or greater shall:
12  (1) report the outstanding obligations owed under the 
13 deductible as liabilities of the insurer, unless the 
14 obligation is fully collateralized using one of the 
15 following methods:
16   (A) a surety bond issued by a surety insurer 
17 authorized to transact business by the Department, and 
18 whose financial strength and size ratings from A.M. 
19 Best Company are not less than "A" and "V", 
20 respectively;
21   (B) an irrevocable letter of credit issued by a 
22 financial institution, with an office physically 
23 located within the State, and the deposits of which are 
 
 
SB1805- 2 -LRB099 09021 MLM 29204 b


1 federally insured; or
2   (C) cash or securities held in trust by a third 
3 party, and subject to a control agreement, for the 
4 express purpose of securing the workers' compensation 
5 claim obligations of the policyholder; and
6  (2) limit the size of the per-occurrence deductible 
7 obligation assumed by the policyholder to the lesser of:
8   (A) 20% of the full policy premium value prior to 
9 application deductible discounts or credits for that 
10 policyholder; or
11   (B) 10% of the total accounting net worth of the 
12 policyholder at each policy inception.


13 Section 99. Effective date. This Act takes effect July 1, 
142015.