Illinois Developments

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The Illinois Department of Insurance (“DOI”) has issued a notice of proposed rules to create 50 Ill. Adm. Code 941 regarding misrepresentations and false warranties. A previous version of the proposed rule was proposed in December of 2014 and withdrawn in October 2015. The DOI reason for the withdrawal was…
Read More Illinois Department of Insurance Proposes Rule on Misrepresentations and False Warranties

Illinois State Treasurer Michael Frerichs has called for statewide hearings to educate the public on how life insurance companies avoid paying death benefits. The first hearing is scheduled for August 17th in Normal, Illinois. According to Frerichs, since 2011, the Illinois State Treasurer’s office has identified more than $550 million…
Read More Illinois Treasurer Holds Statewide Hearings on Life Insurers that Do Not Pay Death Benefits

Based on the policy language before it, the U.S. Court of Appeals for the Seventh Circuit recently found that an insurer has a duty to defend a pharmaceutical distributor in a lawsuit brought by West Virginia’s attorney general alleging that drug distributors contributed to the rise of so-called “pill mills”…
Read More Seventh Circuit: Insurer Has Duty To Defend West Virginia’s Suit Against Drug Distributor Seeking To Recover Amounts Expended By The State Caring For Drug-Addicted Citizens

The Illinois Department of Insurance recently issued a bulletin requiring all companies to obtain independent third party background investigation/verification reports from nationally recognized vendors. The reports must be submitted with any required filing of biographical affidavits of officers and directors including in acquisitions. The vendor should submit the background investigation/verification…

Read More Illinois Department of Insurance Requires Independent Third Party Background Investigation Reports

The Illinois Department of Insurance (“IL DOI”) has amended its record disposal and destruction regulation effective May 23, 2016, significantly reducing reporting, book-keeping and retention obligations for Illinois domestic insurers, as well as any principal U.S. office of a foreign or alien insurer located in Illinois. The amendment to Title…
Read More Update: Illinois Adopts Amendment to Simplify Insurer Record Retention and Destruction Requirements

The U.S. District Court for the Northern District of Illinois recently dismissed a complaint filed by a policy beneficiary asserting that her husband’s lapsed life insurance policy was reinstated because she paid the unpaid premiums five days after her husband’s death. The beneficiary argued that the insurer waived the right…
Read More Illinois Federal Court Dismisses Claim That Premium Payment After Insured’s Death Reinstated Lapsed Life Insurance Policy

The Illinois Legislature has a bill pending in the House Rules Committee that would ban the use of price optimization by insurers. Price Optimization is the practice of setting premiums based on factors that are not tied to expected losses. House Bill 5719 was introduced on February 10, 2016, and…

Read More Proposed Illinois Bill would Prohibit the Use of Price Optimization by Illinois Insurers

The Illinois Department of Insurance recently posted its January 2016 Regulatory Agenda. The Regulatory Agenda contains several proposed changes to holding company regulations. The Insurance Holding Company Systems Article of the Illinois Insurance Code was amended by Public Act 98-609, effective in 2014. The changes to Illinois statutes…
Read More Illinois Department of Insurance January 2016 Regulatory Agenda

The Illinois Department of Insurance (“ IL DOI”) has proposed an amendment to Illinois’ insurer record retention requirements, which would significantly reduce reporting, book-keeping and retention obligations. The current regulation, 50 Ill. Adm. Code 901.20, requires that, prior to destruction, Illinois domestic insurers submit to the IL DOI an affidavit…

Read More Illinois Insurance Department Proposes Amendment to Cumbersome Records Retention and Destruction Requirements

On October 26, 2015, three life insurance companies (the “Kemper Companies”) filed a lawsuit against the Illinois State Treasurer (the “Treasurer”) and private auditing firm, Verus Financial LLC, over the Treasurer’s unclaimed property audits of the Kemper Companies. The lawsuit is the latest litigation between life insurers and state regulators…

Read More Illinois Treasurer Lawsuit Highlights Contingency Fee Risks in Unclaimed Property Audits