Illinois consumers can now shop for auto and homeowners insurance on the Internet thanks to a new program unveiled May 13, 1996, by Director of Insurance Mark Boozell. The inter-active premium comparison program is the latest feature on the Illinois Department of Insurance Home Page.
"Shopping for insurance can be a time-consuming and frustrating process," Boozell said. "Our on-line program allows consumers to access general insurance information and sample rates for hundreds of insurance companies licensed in Illinois. The rates are not intended to reflect the exact price a person will pay for auto or homeowners insurance, but offer an easy way to identify the companies they want to contact for more specific information."
The program provides sample insurance rates for four types of drivers and two types of houses, in thirteen locations around the state, including three in Chicago. Consumers can also call up buyers guides that define common insurance terms, explain the types of coverages available, and offer advice on how to shop for insurance and cut costs.
In addition to the premium information, the Insurance Department's home page currently includes an overview of the Department's organizational structure and regulatory activities, the agency's regulatory newsletter and press releases and insurance information for teenage drivers.
"The Internet offers limitless possibilities for consumer education," Boozell said. "The Department of Insurance intends to take full advantage of this technology to become a valuable electronic information resource for Illinoisans. We are planning a number of additions to our home page, including consumer complaint ratios, Medicare supplement insurance premiums, basic information on a variety of insurance topics, and an on-line complaint form."
The Insurance Department's home page also provides links to the State of Illinois Home Page, the National Association of Insurance Commissioners and profiles on the Illinois Senior Health Insurance Program, the Illinois Comprehensive Health Insurance Plan and the Office of the Special Deputy Receiver.
"We are receptive to suggestions for additional links with other government agencies, consumer resources and insurance- related web sites," Boozell said.
The Department's address is: http://www.ins.state.il.us/
The U.S. Court of Appeals for the Seventh Circuit has reaffirmed the state's regulatory authority over entities attempting to sell insurance products in Illinois. The court's decision in American Deposit Corp. v. Schacht (case #95-2462), upholds the Illinois Insurance Department's right to issue a cease and desist order to Blackfeet National Bank of Browning, Montana, both for underwriting and soliciting the sale of annuities without a certificate of authority.
The bank asked a federal district court and then the federal appeals court to prohibit the Department from taking action on the grounds that fixed annuities were not insurance products and the National Bank Act precluded the Department from regulating the bank, even if it was transacting the business of insurance. The court disagreed with both of those conclusions, finding that:
fixed annuities are insurance for purposes of the analysis needed to decide this case;
Section 24 (seventh) of the National Bank Act does not specifically refer to insurance and therefore the McCarran- Ferguson Act would prevent it from preempting state law; and
the State of Illinois has the authority to regulate the underwriting of annuities by banks.
"The court's decision reaffirms the primacy of state laws in regulating the business of insurance," Boozell said. "In essence, this decision says the only way federal law can preempt state insurance laws is if the federal law specifically relates to the business of insurance.
"Our overriding concern has been to protect Illinois consumers in their insurance transactions. We are gratified that the decision supports the continued regulation of insurance underwriting and sales by the states in the absence of conflicting federal law."
Illinois consumers appear to be more satisfied with their insurance coverage according to 1995 complaint information released by Director Mark Boozell. Total insurance company complaints closed by the Department of Insurance dropped from 11,987 in 1994 to 11,018 in 1995; while written grievances against health maintenance organizations declined to 569 from 610.
"Complaint analysis is never an exact science, but we believe the lower numbers are due in part to heightened public awareness," Boozell said. "Consumers are becoming increasingly sophisticated about doing their insurance homework before they buy a policy. The more information they have up front, the less likely they'll run into problems or misunderstandings at claims time," he said.
Of the total 1995 complaints, auto insurance accounted for 45 percent; group accident and health for 17 percent; individual life for 9 percent; individual accident and health for 8 percent; homeowners for 7 percent; and HMOs for 5 percent. The remaining 9 percent were miscellaneous coverages.
Seventy (70) percent of the grievances against insurers and 94.2 percent of those against HMOs involved claims handling. Other reasons for complaints included: underwriting - insurers, 12 percent and HMOs, 3.3 percent; policyholder service - insurers, 10 percent and HMOs, 2.5 percent; marketing and sales - insurers, 8 percent and HMOs, none.
Geographically, 81 percent of HMO and 68 percent of insurance company complaints came from the Chicago/Metropolitan Cook County areas, while downstate accounted for 12 percent and 27 percent respectively.
The Department of Insurance calculates a complaint ratio and ranks all HMOs, but limits the insurance company listings to those charged with ten or more complaints per line of coverage. A rank of 1 reflects the lowest complaint ratio in the group.
Director Mark Boozell filed a "friend of the court" brief on May 7, 1996, in a Federal 9th Circuit Court of Appeals case in which the enforceability of insurance issued at Lloyd's of London had been challenged. Boozell's brief was filed to protect the interests of insolvent Illinois insurers of which he is the Receiver.
The case involved the appeal by California Insurance Commissioner Chuck Quackenbush of the lower court's decision denying Quackenbush the right to intervene in litigation brought by the California Corporations Commissioner against Lloyd's of London and others. In that litigation, the Corporations Commissioner sought, among other things, to rescind Lloyd's insurance policies because of alleged state securities law violations involving participation in the Lloyd's marketplace by certain wealthy California residents, known as "Names." Commissioner Quackenbush had attempted to intervene in the trial court in order to protect the interests of Lloyd's insureds and the integrity of the insurance marketplace he regulates.
"I take no position on whether participation by these Names involved the improper sales of 'securities' under California law," Boozell said. "That question will be resolved by the trial court. My only interest is that innocent third parties--the people who bought and paid for insurance and reinsurance issued by the Lloyd's Names--get the benefit of the bargain they made with the Names.
"The Names may or may not have legitimate grievances against the defendants in the trial court. If they do, any relief they get should come from the defendants, and not from the innocent parties who have relied on the Names' insurance commitments."
Ironically, the day after Director Boozell filed his brief, the trial court dismissed without prejudice the action brought by the Corporations Commissioner. Since then, in part because of the efforts of Director Boozell and other insurance regulators, the Corporations Commissioner has agreed to participate in voluntary attempts to mediate the Lloyd's issue with the other involved parties. Whether the Corporations Commissioner refiles his original lawsuit will depend on the success of these mediation efforts.
Lloyd's Names have issued policies of insurance to hundreds of Illinois insureds, including municipalities, churches, banks, manufacturers, merchants, architects, law firms, and many other businesses. Lloyd's Names have also issued "reinsurance"-- insurance for insurance companies--providing approximately $1.3 billion of financial support to Illinois insurers. The insolvent Illinois insurers Boozell represents as Receiver look to Lloyd's Names for $10 million or more of reinsurance needed to pay claims against these failed companies.
Illinois Department on Aging Director Maralee I. Lindley and Illinois Department of Insurance Director Mark Boozell recently announced the availability of a new type of long term care insurance that will allow Illinoisans to obtain long term health care at home or in a nursing home without having to impoverish themselves. The "Partnership Policy" is a three-way partnership involving an individual, a licensed insurance company and the State of Illinois.
"Developed by a task force representing insurance companies, consumers and state officials, the Partnership offers Illinois residents a unique blend of insurance coverage and asset protection not available through traditional long term care insurance coverage," Lindley said.
With a Partnership Policy, consumers can protect a dollar of assets for each dollar of insurance they buy. For example, if an individual buys a policy with a maximum benefit payout of $50,000, then $50,000 of that person's assets would be protected. After the individual's insurance benefits are used, he or she could keep $50,000 in personal assets and still be eligible to have Medicaid pay for additional long term care costs.
Individuals who want to protect more or less of their assets can select a policy with a higher or lower benefit payout, but there is no limit on the amount of assets that can be protected in this way.
"We are especially pleased that policyholders will have the option of using their long term care insurance benefits to purchase in-home services, such as home delivered meals or shopping assistance," said Lindley.
To date, the Partnership Policy is being offered by the American Travellers Life Insurance Company and Bankers Life and Casualty Insurance Company.
"Other companies are eventually expected to carry the policy, as well," said Boozell. "The policy is an example of how the public and private sector can work hand-in-hand to provide a type of insurance that makes a lot of sense for people who are concerned about protecting their assets."
Illinois insurance producers selling the Partnership Policy are required to complete six hours of specialized training in addition to the six already required for long term care products.
The cost of a Partnership Policy depends on the individual's age at the time of purchase, as well as the amount and type of policy features selected. The younger an individual is, the lower the cost of the policy.
A shopper's guide and brochure that explain more about the Partnership Policy are available free of charge through the Illinois Department on Aging's Senior HelpLine, 1-800-252-8966 (Voice and TDD).
by Pamela Donnewald, CPCU
Flooding is a major, recurring problem in Illinois. Between 1985 and 1995 Illinois suffered eight major floods that have warranted Presidential declarations. Even as I write, Illinois rivers have flooded again and the President has just declared several more counties federal disasters due to flooding.
Each spring, as the rains fall, the Department of Insurance receives calls from consumers and insurance producers who are confused about flood insurance. This year has been no exception.
The following are facts about flood insurance that are often misunderstood:
Fact: Floods occur more often than you think. Ninety percent of all disasters in the U.S. are flood-related. You are four times more likely to experience a flood than a fire if you live in a high risk flood zone.
Between 1981 and 1995, only 28 Illinois counties have not had a federal flood declaration.
Fact: Most, if not all, homeowners policies specifically exclude flood damage. There are limited exceptions under some mobile homeowners policies.
Fact: You can buy federal flood insurance no matter where you live in Illinois, as long as your community participates in the National Flood Insurance Program (NFIP). You can buy insurance if the property is in a floodplain or out of a floodplain, as long as the property is located in a participating community.
Fact: You don't have to live near water to be a flood victim. About one-third of all claims paid by the NFIP are for properties in areas that have a minimal to moderate chance of flooding (Zones B, C and X in Illinois). Flooding in these areas is often the result of inadequate local drainage systems.
Fact: Some people refuse to buy flood insurance thinking the federal government will help them out. To be eligible for federal disaster assistance, a community must be declared a federal disaster area. Although 90% of all disasters in the U.S. are flood-related, federal disaster assistance declarations are awarded in less than 50% of flooding incidents.
Federal disaster assistance often comes in the form of loans that must be repaid with interest. Furthermore, if you are uninsured and receive federal assistance, you must purchase flood insurance to receive federal disaster relief in the future.
Fact: In addition to homeowners and condo unit owners, condo associations and businesses can also be insured through the NFIP. Renters may also purchase a flood insurance policy for their contents.
Fact: Any licensed property and casualty insurance producer can sell a flood insurance policy. Those producers should therefore know how to write this coverage for their clients.
Fact: The waiting period for flood insurance is no longer 5 days. During the 1993 Midwest floods, many claims were paid under policies that had been in force less than a month. To discourage such adverse selection in the future, Congress increased the waiting period to 30-days.
------The 1993 Midwest floods brought flood insurance into the spotlight. As a result, many people are more aware of the risk of floods, and are taking steps to prepare. It is crucial that people understand that they have the power to protect themselves from floods by purchasing flood insurance.
Insurance producers are in a unique position to communicate this message to consumers, and can do so in two ways: First, insurance producers can contact the NFIP for a list of the free materials that are available to help market the policies. Second, producers can educate themselves and their staffs about flood insurance.
The NFIP has an excellent four-hour seminar that provides four continuing education credits and is specifically geared toward the needs of producers. Upcoming seminars will be held on August 15 in Bloomington/Normal and on August 21 in Schaumburg. Costs are $30 per person.
As a special post-flood service to producers, the NFIP will hold free seminars (still providing four continuing education credits), during the month of June in the Belleville/Collinsville area, Marion, Decatur and Effingham.
To obtain information about exact times and locations, or to sponsor your own seminar, contact Rich Slevin or Joy Duffy at the NFIP Bureau and Statistical Agent (708) 955-4550.
Certificates of authority have been issued to the following
entities:
Third Coast Insurance Company, IL, 4/1/96
Unique Insurance Company, IL, 4/3/96
Diamond Insurance Company, IL, 4/26/96
Contemporary American Insurance Company, IL, 5/2/96
Physicians Insurance Company of Wisconsin, Inc., WI, 5/28/96
Suspension
Frontier Insurance Company, MO, was suspended effective
3/21/96 - 3/21/98 because its capital and surplus are below
minimum requirements.
Terminations
The following insurance company is no longer doing business
in Illinois:
The Fidelity General Life Insurance Company, PA, requested
voluntary dissolution from the State of Pennsylvania; IL
certificate of authority cancelled effective 3/8/96.
Back to the top
Producer regulatory action
(Copies of regulatory orders are available upon written request
to the Producer Regulatory Unit, at a cost of $1/page.)
Revocation of Licensing Authority
Richard F. Beaird
1920 Winchester
Champaign, IL
Effective 10/31/94
William B. Sanders
195 N. Harbor Drive, Apt. 2307
Chicago, IL
Effective 4/15/96
Alan M. Ralsky
9439 N. Leamington
Skokie, IL
Effective 4/19/96
Voluntary Revocation
Robert C. Holloway
R.R. #2, Box 153A
Girard, IL
Effective 3/18/96
Douglas Fredrick Kehler
9520 Wagner Road
McConnell, IL
Effective 4/19/96
Stipulation and Consent Order - Civil Forfeiture Paid
Akanni W. Adegbite
6201 N. Kenmore
Chicago, IL
Effective 4/8/96
Alpha Premium Finance Company, Inc.
2501 Sullivan Drive
Belleville, IL
Effective 4/20/96
Craig T. Loiacano
378 Satinwood Terrace
Buffalo Grove, IL
Effective 2/14/96
Armando E. Marcianelli
701 N. Harrison Street
Algonquin, IL
Effective 3/8/96
Dean H. Matsuo
6807 W. Roosevelt Road
Berwyn, IL
Effective 3/14/96
Midwest Insurance Services
908 W. 1st Avenue, Suite C
Lincoln Square
Marion, IL
Effective 1/4/96
Arthur S. Miller
2612 Oak Street
Highland Park, IL
Effective 3/14/96
Miller Insurance Agency, Inc.
271 S. State Street
Elgin, IL
Effective 4/8/96
Neis Insurance Agency
45 N. Virginia Street
Crystal Lake, IL
Effective 3/20/96
Thomas J. Neis
1106 Boone Creek Court
McHenry, IL
Effective 3/20/96
Republic Premium Finance Company
6807 West Roosevelt Road
Berwyn, IL
Effective 3/14/96
Brenda K. Richey
1303 Adams Street
Johnson City, IL
Effective 1/4/96
USA Insurance Brokers
6807 W. Roosevelt Road
Berwyn, IL
Effective 3/14/96
Tommy Lee Washington
2605 W. Hayes Street
Peoria, IL
Effective 2/14/96
William R. Werst, Jr.
2245 South Street
Elgin, IL
Effective 4/8/96
Mark L. Zisook
1621 Dundee Road
Northbrook, IL
Effective 2/29/96
Other Department Actions
Thomas J. Merryweather
2650 N. Mildred
Chicago, IL
Effective 3/1/96
Director's Order
Cancellation Due to Dishonored Check
Beverly Coleman
400 East
33rd Street, #1914
Chicago, IL
Effective 2/9/96
Aaron E. Haag
17 Magnolia Drive
Belleville, IL
Effective 1/24/96
Vince Hardeman
7302 S. Wabash
Chicago, IL
Effective 1/31/96
Charles Mitchell
1438 West Wellington
Chicago, IL
Effective 2/25/96
Julie D. Nimtz
613 East Lincoln Avenue
Belvidere, IL
Effective 1/1/96
Paul W. Peterson
1840 E. Ridgewood Lane
Glenview, IL
Effective 12/23/95
Harry W. Sharpe
1505 London Court
Naperville, IL
Effective 2/1/96
Charles Simmons
10450 S. Church Street
Chicago, IL
Effective 1/12/96
Milton D. Simmons
14401 Sanderson
Dolton, IL
Effective 3/7/96
Leonard C. Sisnette
7813 S. Chappel
Chicago, IL
Effective 1/26/96
Stephanie Wagner
2857 Barber Court
Joliet, IL
Effective 2/19/96
Raynetta E. Waller
4800 Chicago Beach Drive, #908N
Chicago, IL
Effective 1/12/96
Aaron J. Wanek
9057 Grave Avenue
Niles, IL
Effective 3/4/96
Other Dishonored Checks
Arletha L. Bolton
2331 W. 157th Street
Markham, IL
Wenonah Dampier
1660 South Drake Avenue
Chicago, IL
O L Jones
2207 E. 70th Place
Apt. 1W
Chicago, IL
Barry L. Layton
7952 S. Colfax
Chicago, IL
Robert E. Miller
707 N. Hazel Street
Danville, IL
Algernon Parker
8053 S. Dobson
Chicago, IL
James B. Thomas
1317A Plymoth Ct
Chicago, IL
Emma J. Thompson
402 Gettysburg Street
Park Forest, IL
To-Mas & Associates
3649 W. 183rd
Hazel Crest, IL
Back to the top
Examination reports filed
Financial
Group Health Plan, Inc. 3/13/96
Palmyra Lincoln Mutual Insurance Company 3/14/96
Rush Prudential Insurance Company 3/15/96
General Casualty Company of Illinois 4/16/96
Professional Life & Casualty Company 4/23/96
Royal Neighbors of America 4/23/96
United Health & Life Insurance Company 4/23/96
American Ambassador Casualty Company 4/29/96
German Mutual Fire Insurance Company of North Chicago 4/29/96
Kane County Mutual Insurance Company 4/29/96
Omni Insurance Company 4/29/96
Allstate Life Insurance Company 5/07/96
Polish Women's Alliance of America 5/07/96
Rush Prudential HMO, Inc. 5/07/96
United National Life Insurance Company of America 5/07/96
Farmers Automobile Insurance Association 5/10/96
The Mount Carroll Mutual Fire Insurance Company 5/10/96
Pekin Insurance Company 5/10/96
Guarantee Trust Life Insurance Company 5/15/96
Market Conduct
Beginning with this issue, we will also list market conduct
examination reports filed. For this initial list, we have
included reports filed during the last quarter of 1995.
Midwest Mutual Insurance Company 10/19/95
Country Life Insurance Company 10/20/95
American Chambers Life Insurance Company 10/27/95
Reliable Life Insurance Company 11/17/95
Jackson National Life Insurance Company 12/21/95
Constitutional Casualty Insurance Company 1/26/96
Illinois National Insurance Company 1/26/96
Back to the top
Department rules review
The full text of Department rules is printed in the Illinois
Register published weekly by the Illinois Secretary of State's
Index Department, 111 E. Monroe St., Springfield, IL 62756.
Subscriptions are available from that source for an annual fee of
$290. Issue numbers and a Department contact person are listed
below after each rule summary.
Copies of rules are also available upon written request to
the Department of Insurance at a $1 per page charge. Adopted
rules are codified in Title 50 of the Illinois Administrative
Code.
Rule 930 (Life Insurance Solicitation) was amended on
March 4, 1996, to add two additional disclosure requirements to
ensure that the family or representative of the deceased is not
deprived of the advantages of open competition and unrestricted
choice in connection with the burial of the deceased. (Vol. 19,
#11; Charles Budinger)
Rule 2008 (Minimum Standards for Individual and Group
Medicare Supplement Insurance) was amended on April 28, 1996, to
comply with changes to the federal requirements for Medicare
supplement insurance in the areas of open enrollment, loss ratio
provisions, duplication of coverage, agent compensation, Medicare
Select and mailing of policies. Federal requirements were
effective on October 31, 1994, under the Social Security Act
Amendments of 1994. (Vol. 20, #19; Linda Smith)
Rule 2801 (Surplus Line Business Requirements) was amended
on April 9, 1996, to implement Section 445 of the Illinois
Insurance Code which sets forth licensing requirements for
surplus lines producers who place policies or contacts of
insurance with companies not authorized to do business in
Illinois. The rule was amended to reflect the increase (from
$5,000,000 to $15,000,000) in minimum policyholders surplus
required by PA 88-627, effective September 9, 1994. (Vol. 20,
#16; Cindy Stephenson)
Rule 6302 (Definition of Salary) was amended on April 9,
1996, to define "salary" for the determination of contributions
made to pension funds on behalf of employees. The rule also
specifies what "salary" is not, so that consistent standards will
be used by all pension funds. (Vol. 20, #16; Mike Blankenship)
Back to the top
Hearings
Completed Hearings:
Fermin P. Castillo
Letter of Denial rescinded
and respondent permitted
to obtain license 3/21/96
Hearing No. 3387
"V" Brothers Machine Corporation
Sentry ordered to apply correct
classification to policy period
and provide refund 3/21/96
Hearing No. 3365
John and Diane Shastal
State Farm Fire & Casualty Company
Nonrenewal effective 4/16/96
Hearing No. 3418
Barrington Police Pension Fund
Audit accepted for filing 4/17/96
Hearing No. 3366
Callie Chapman
State Farm Fire & Casualty Company
Nonrenewal effective 4/17/96
Hearing No. 3416
S.I. Extended Contractors, Inc.
Ruling of IL Workmen's Compensation
Appeals Board upheld 4/17/96
Hearing No. 3351
Russell and Khrystal Smith
State Farm Fire & Casualty Company
Cancellation effective 4/17/96
Hearing No. 3417
Alan M. Ralsky
Order of Revocation made final 4/19/96
Hearing No. 3378
Marion A. Miles
State Farm Fire & Casualty Company
Nonrenewal effective 5/2/96
Hearing No. 3420
Raj and Monica Shekar
State Farm Mutual Automobile Ins. Co.
Nonrenewal effective 5/20/96
Hearing No. 3412
Raj Shekar and Pushpa Monica Shekar
State Farm Mutual Automobile Ins. Co.
Nonrenewal not allowed 5/20/96
Hearing No. 3425
Raj Shekar and Pushpa Monica Shekar
State Farm Mutual Automobile Ins. Co.
Nonrenewal effective 5/20/96
Hearing No. 3426
Matters Settled without Hearing:
Association of Trial Lawyers Assur.
Hearing dismissed 2/9/96
Hearing No. 2822
The Brotherhood Newsletter
Hearing dismissed 3/20/96
Hearing No. 2927
Louise M. Cadwell
State Farm Fire & Casualty Company
Hearing dismissed 4/22/96
Hearing No. 3423
Deborah Hagemeier
State Farm General Insurance Company
Policy reinstated 5/2/96
Hearing No. 3422
Ray and Angela Allen
Citizens Insurance Company of America
Hearing Dismissed 5/10/96
Hearing No. 3421
Carl and Terri Dover
Country Mutual Insurance Company
Hearing dismissed 5/10/96
Hearing No. 3430
Scheduled Hearings:
Kathleen A. Thomas
Illinois Farmers Insurance Company
Nonrenewal 5/29/96
Hearing No. 3432
Arthur G. Wargo, Jr.
State Farm Mutual Automobile Ins. Co.
Cancellation 6/4/96
Hearing No. 3433
William and Pamela Hagen
Merchants Property Ins. Co. of Indiana
Cancellation 6/5/96
Hearing No. 3435
K & S Associates, Inc.
Generali
Cancellation 6/7/96
Hearing No. 3437
Audree Friedman
State Farm Fire & Casualty Insurance Company
Cancellation 6/11/96
Hearing No. 3434
Suzette Ferrill
Country Mutual Insurance Company
Cancellation 6/12/96
Hearing No. 3436
Cathyrn R. Iversen
State Farm Mutual Automobile Ins. Co.
Nonrenewal 6/18/96
Hearing No. 3439
Mennonite Motorist's Aid
Cease and Desist 6/21/96
Hearing No. 3446
| Copyright ©2007 DOI | Contact Us | Privacy/Disclaimer | Illinois Privacy Information | Kids Privacy | Web Accessibility |