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Page 7 of 25may be proven consistent with IllinoisSupreme Court Rule 236.PREMIUM INCREASENOTICEREFERENCE DESCRIPTION OF REVIEW OFSTANDARDS REQUIREMENTSNotice requirements for215 ILCS 5/462a The insurer must mail or deliver to the namedpremiums increases in excessinsured, written notice of such premiumof 5% above the rateincrease indicating the insurer's intention torecommendation filed by thecondition renewal upon issuance of a policyDepartment.that supersedes the policy previously issuedand that will result in a premium in excess of5% above the rate recommendation filed withthe Department. The notice shall be deliveredat least 30 days in advance of the expirationdate of the policy, and shall set forth: (1) theamount of the premium increase or, if theamount cannot reasonably be determined as ofthe time the notice is provided, a reasonableestimate of the premium increase based uponthe information available to the insurer at thattime; and (2) the reason for the increasedpremium in excess of the rate recommendationfiled with the Department. Nothing in thisSection requires the insurer to provide noticewhen the employer, an agent or brokerauthorized by the employer, or another insurerof the employer has delivered written noticethat the policy has been replaced or is nolonger desired.NOTICE OFCANCELLATIONREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSCancellation notice mailing215 ILCSrequirements and requirements 5/143.14for canceling premiumfinanced insurance contracts.Insurer must mail cancellation notice to namedinsured and to the mortgage or lien holder andsend copy of such notice to the insured'sbroker, if known, or the agent of record, at thelast mailing address known by insurer. Insurermust maintain proof of mailing on a form7

Page 8 of 25acceptable to U.S. Post Office or othercommercial mail delivery service.Section 143.14 also contains requirements forcanceling premium financed insurancecontracts and procedures for returningunearned premium. See law for specific detailsof requirements.Number of days notice215 ILCSrequired for cancellation of5/143.16commercial policies and noticerequirements.Insurer must mail cancellation notice to thenamed insured at least: 10 days prior toeffective date of cancellation for nonpaymentof premium; 30 days prior to effective date ofcancellation during the first 60 days ofcoverage; 60 days prior to effective date ofcancellation after coverage has been effectivefor 61 days or more.All notices shall include a specific explanationof the reason(s) for cancellation.Cancellation notice mustadvise insured of right torequest a hearing.215 ILCS5/143.23If an insurer cancels a commercial policy midterm per Section 143.16a, for any reasonexcept non-payment of premium, thecancellation notice must advise the namedinsured of the right to appeal and the procedureto follow for such appeal.215 ILCS5/143.16aNOTICE OF NONRENEWALREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSNumber of days noticerequired for nonrenewing acommercial policy and othernotice requirements.215 ILCS5/143.17aNonrenewal notice must be mailed to thenamed insured at least 60 days in advance ofthe nonrenewal date.Insurer must maintain proof of mailing of suchnotice on a recognized U.S. Post Office formor a form acceptable to the U.S. Post Office orother commercial mail delivery service.If the insurer fails to mail notice of nonrenewalto the named insured at least 60 days in8

Page 9 of 25advance of the nonrenewal date, the insurermust extend the policy for an additional year oruntil the effective date of any similar insuranceprocured by the insured, whichever is less, onthe same terms and conditions as the policysought to be terminated, unless the insurer hasmanifested its intention to renew at a differentpremium that represents an increase notexceeding 30%.Notification must also be mailed to theinsured's broker, if known, or the agent ofrecord and to the mortgage or lien holder listedon the policy.Nonrenewal notice must provide a specificexplanation of the reason(s) for nonrenewal.PERMISSIBLE REASONS REFERENCE DESCRIPTION OF REVIEWFOR CANCELLATIONSTANDARDS REQUIREMENTSMay not cancel because agent's 215 ILCScontract with insurer was5/141.01terminated.Insurers may not cancel any policy on theground that the company's contract with theagent through whom the policy was obtainedhas been terminated.May not cancel a policy on215 ILCSsole basis of previous refusal, 5/143.10cancellation or nonrenewal byany insurer.Insurers may not cancel a policy on the solebasis that the insured or applicant for suchpolicy was previously refused issuance orrenewal of a policy by an insurer, or suchinsured's policy was cancelled on a prior dateby any insurer.Reasons for canceling acommercial policy that hasbeen in effect for 60 days ormore.After a policy has been in effect for 60 days,insurer may only cancel for the following 6reasons: (a) non-payment of premium; (b) thepolicy was obtained through a materialmisrepresentation; (c) any insured violated anyterms and conditions of the policy; (d) the riskoriginally accepted has measurably increased;(e) the insurer certifies to the Director of theloss of reinsurance for all or a substantial part215 ILCS5/143.16a50 IL Adm.Code 9409

Page 10 of 25of the underlying risk; or (f) the Directordetermines that continuation of the policycould place the insurer in violation of Illinoisinsurance laws.Rule 940 outlines requirements for certificationof loss of reinsurance.Large deductible provisions.215 ILCS5/143.13(e)215 ILCS5/143.16215 ILCS5/143.16aFailure to reimburse a deductible and failure tomaintain collateral are conditions that do notmeet the definition of non-payment ofpremium under 143.13(e). A policy cannot becancelled for non-payment of premium for notmeeting these conditions.Rating or underwritingdecisions based solely ondomestic violence.215 ILCS5/155.22bNo insurer that issues a property and casualtypolicy may use the fact that an applicant orinsured incurred bodily injury as a result of abattery committed against him/her by a spouseor person in the same household as a solereason for a rating or underwriting decision.PERMISSIBLE REASONS REFERENCE DESCRIPTION OF REVIEWFOR NON-RENEWALSTANDARDS REQUIREMENTSMay not refuse to renewbecause agent's contract withinsurer was terminated.215 ILCS5/141.01Insurers may not refuse to renew any policy onthe ground that the company's contract with theagent through whom the policy was obtainedhas been terminated.May not refuse to renew a215 ILCSpolicy on sole basis of previous 5/143.10refusal, cancellation ornonrenewal by any insurer.Insurers may not refuse to renew a policy onthe sole basis that the insured or applicant forsuch policy was previously refused issuance orrenewal of a policy by an insurer, or suchinsured's policy was cancelled on a prior dateby any insurer.Insurers may nonrenew for215 ILCSalmost any reason(s) except5/143.17athose specifically prohibited inother Illinois insurance laws orregulations.Insurers may nonrenew for almost anyreason(s) except those specifically prohibitedin other Illinois insurance laws or regulations.10

Page 11 of 25However, insurers must give aspecific explanation of thereason(s) for nonrenewal.However, insurers must give a specificexplanation of the reason(s) for nonrenewal.RETURN PREMIUMREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSComputation of premiums -refunds.215 ILCS 5/462b If the insurer applies incorrect classifications,payrolls or any other incorrect factors of arating system that results in the insured payingexcess premiums, the insurer shall refund theexcessive premiums paid for the period duringwhich the incorrect classifications, payrolls orother rating factors were applied.CONSUMERINFORMATIONREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSCancellation notice mustadvise insured of right torequest a hearing.215 ILCS5/143.23Written notice of company'scomplaint Department andDepartment of InsurancePublic Service Department.215 ILCS 5/143c No policy may be delivered unless thepolicyholder or certificate holder is provided50 IL Adm.written notice of the address of the complaintCode 931Department of the insurance company, and theaddress of the Public Service Department ofthe Department of Insurance or its successor.If an insurer cancels a policy mid-term perSection 143.16a, for any reason except nonpayment of premium, the cancellation noticemust advise the named insured of the right torequest a hearing to appeal such decision, andthe procedure to follow for such appeal.Rule 931 provides more specific guidance that:a) such notice shall accompany any newlyissued policy or binder;b) "written notice" shall be satisfied by: anyprinted notice delivered with a policy orcertificate; any adhering label attached to apolicy or certificate; any computerized noticeissued concurrently with a computer issued11

Page 12 of 25policy or certificate; or any other form ofindividual written notice substantially similarto the above.Notice of Availability of the Department ofInsurance shall be no less informative than thefollowing: Illinois Department of Insurance,Consumer Division, 122 S. Michigan Ave.,19th Floor, Chicago, Illinois 60603 and IllinoisDepartment of Insurance, 320 WestWashington Street, Springfield, Illinois 62767.The address to be used for the company shallbe an office that can service all types ofcomplaints. If one office cannot service alltypes of complaints, then the additionaladdresses of each appropriate service officemust be given.In addition to providing the required addresses,the notification should set forth the minimumamount of information included in thefollowing suggested wording: "This notice is toadvise you that should any complaints ariseregarding this insurance, you may contact thefollowing."CONTENT OF POLICIESREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSReasons for which the Director 215 ILCSmay disapprove a form filing. 5/143(2)Requirements for form content 50 IL Adm.and readability.Code 753The Director may disapprove any form that (i)violates any provision of the Illinois InsuranceCode, (ii) contains inconsistent, ambiguous, ormisleading clauses, or (iii) contains exceptionsand conditions that will unreasonably ordeceptively affect the risks that are purportedto be assumed by the policy.There must be printed at the head of the policythe name of the insurer or insurers issuing thepolicy, the location of the Home Officethereof; a statement of whether the insurer is a12

Page 13 of 25stock, mutual, reciprocal, Lloyds, alien insurer,or an insurer operating under a charter bySpecial Act of the Legislature of any state.There may be added thereto such devices,emblems or designs and dates as areappropriate for the insurer issuing the policy.All forms must be identified by a descriptivetitle, form number and edition identification.All forms must be printed in not less thaneight-point type.DEFENSE WITHINLIMITSREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSDefense costs may not beincluded in limits of liability.215 ILCS5/143(2)DEFINITIONSREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSDefense costs must be paid as supplement tothe limits of liability. Defense costs may not beincluded in the limits of liability. Any formsthat contain provisions to the contrary aredeemed to contain exceptions and conditionsthat unreasonably or deceptively affect therisks that are purported to be assumed by thepolicy, in violation of Section 143(2) and willbe disapproved accordingly.Definition of "renewal" or "to 215 ILCSrenew."5/143.13(d)Definition of "renewal" or "to renew."Definition of "nonpayment of 215 ILCSpremium."5/143.13(e)Definition of "nonpayment of premium."Definition of "policy delivered 215 ILCSor issued for delivery in this 5/143.13(f)State."Definition of "policy delivered or issued fordelivery in this State."Definition of "cancellation" or 215 ILCS"cancelled."5/143.13(g)Definition of "cancellation" or "cancelled."13

Page 14 of 25DISCRIMINATIONREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSMay not cancel certainpolicies, or refuse to issue orrenew certain policies solelydue to hate crimes.215 ILCS5/143.24cInsurers may not cancel a policy, or refuse toissue or renew a policy solely on the basis thatone or more claims have been made againstTitle 26 U.S.C. any policy during the preceding 60 months, forSectionsa loss that is the result of a hate crime, if the170(b)(1)(A)(i), insured provides evidence to the insurer that(ii), and (vi).the act causing the loss is identified as a hatecrime on a police report.Applies to policies issued to an individual, areligious organization described in Section170(b)(1)(A)(i) of Title 26 of the United StatesCode, or an educational organization describedin Section 170(b)(1)(A)(ii) of Title 26 of theUnited States Code, or any other nonprofitorganization described in Section170(b)(1)(A)(vi) of Title 26 of the UnitedStates Code that is organized and operated forreligious, charitable, or educational purposes.Redlining -- When geographic 215 ILCSlocation of risk may be5/155.22grounds for refusing to insure.Insurer may not refuse to provide insurancesolely on the basis of the specific geographiclocation of the risk unless such refusal is for abusiness purpose which is not a mere pretextfor unfair discrimination.Rating, claims handling, andunderwriting decisions basedsolely on domestic violence.215 ILCS5/155.22bNo insurer that issues a property and casualtypolicy may use the fact that an applicant orinsured incurred bodily injury as a result of abattery committed against him/her by a spouseor person in the same household as a solereason for a rating, underwriting, or claimshandling decision.Unfair methods of competition 215 ILCSor unfair or deceptive acts or 5/424(3)practices defined.It is an unfair method of competition or unfairand deceptive act or practice if a companymakes or permits any unfair discriminationbetween individuals or risks of the same classor of essentially the same hazard and expense14

Page 15 of 25element because of the race, color, religion, ornational origin of such insurance risks orapplicants.Procedure as to unfair methods 215 ILCS 5/429of competition or unfair ordeceptive acts or practices notdefined.Civil Union Partnershipseffective June 1, 2011Outlines the procedures the Director followswhen he has reason to believe that a companyis engaging in unfair methods of competitionor unfair or deceptive acts or practices.750 ILCS 75/1The Religious Freedom Protection and CivilUnion Act (Public Act 96-1513) will allowCivil Union Fact both same-sex and different-sex couples toSheetenter into a civil union with all of theobligations, protections, and legal rights thatIllinois provides to married heterosexualcouples.Please note that whenever a policy form,application, or rating rule includes the terms"spouse," "married," or "immediate familymember" it is required that parties to a civilunion be included in these definitions.DOMESTIC ABUSEREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSRating, claims handling, andunderwriting decisions basedsolely on domestic violence.215 ILCS5/155.22bNo insurer that issues a property and casualtypolicy may use the fact that an applicant orinsured incurred bodily injury as a result of abattery committed against him/her by a spouseor person in the same household as a solereason for a rating, underwriting, or claimshandling decision.Intentional acts exclusion -exception for innocent coinsured.215 ILCS5/155.22bIf a policy excludes property damage coveragefor intentional acts, the insurers may not denypayment to an innocent co-insured who did notcooperate in or contribute to the creation of theloss if the loss arose out of a pattern of criminaldomestic violence and the perpetrator of theloss is criminally prosecuted for the act causingthe loss.15

Page 16 of 25EXCLUSIONS &LIMITATIONSREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSBlank endorsements areacceptable for filing, withexceptions.215 ILCS5/143(2)MOLDREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSBlank endorsements may be filed, but may notbe used to decrease coverage, increase rates ordeductibles, or negatively alter any terms orconditions of coverage, unless such change isat the sole request of the insured. Any formsthat contain provisions to the contrary aredeemed to contain exceptions and conditionsthat unreasonably or deceptively affect therisks that are purported to be assumed by thepolicy, in violation of Section 143(2) and willbe disapproved accordingly.Filing procedures andCompanyPlease refer to Company Bulletin 2002-07 forrequirements for exclusionsBulletin 2002-07 specific information and guidance.and limitations related to mold.TERRORISMREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSTerrorism Risk InsuranceCompanyPlease refer to Company Bulletin 2015-03 forProgram Reauthorization Act Bulletin 2015-03 specific information and guidance.of 2015 and Filing Proceduresand Requirements forTerrorism-Related Forms,Rules and Rates.GROUP POLICIESREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSGroup Workers' Compensation 215 ILCSpolicies are not specifically5/388a-388gallowed by statute.215 ILCS5/393a-393g215 ILCS5/400.1There are no enabling statutes in Illinois thatauthorize the writing of group fire, casualty,inland marine, or surety insurance. The effectis to require that all fire, casualty, inlandmarine, or surety insureds of the same class betreated alike. These provisions are notapplicable where the Illinois Insurance Codespecifically authorizes the grouping of risks.16

Page 17 of 25The only coverages that are currentlyauthorized on a group basis are: a) groupvehicle; b) group professional liability; c)215 ILCS 5/900- group inland marine; d) group legal.906IL Adm. Code2302Claims handling requirements. 820 ILCS 305/1 All claims must be handled in accordance withthe Illinois Workers' Compensation Act.ACTION AGAINSTCOMPANYREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSPeriods of limitation tolled.215 ILCS5/143.1DEFENSE COSTSREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSDefense costs may not beincluded in limits of liability.215 ILCS5/143(2)DEDUCTIBLEREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSRating plan must contain offer 215 ILCSof a deductible applicable to 5/456(1)(e)the medical benefit only.If the form contains a provision limiting theperiod of time within which the insured maybring suit, the provision must state that therunning of such period is tolled from the dateproof of loss is filed until the date the claim isdenied in whole or in part.Defense costs must be paid as supplement tothe limits of liability. Defense costs may not beincluded in the limits of liability. Any formsthat contain provisions to the contrary aredeemed to contain exceptions and conditionsthat unreasonably or deceptively affect therisks that are purported to be assumed by thepolicy, in violation of Section 143(2) and willbe disapproved accordingly.Rating plan shall contain a mandatory offer ofa deductible applicable only to the medicalbenefit under the Work Comp Act (820 ILCS3-5/1 et seq.). Such deductible offer shall be ina minimum amount of at least 1000 peraccident.17

Page 18 of 25MEDICAL PAYMENTSREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSRating plan must contain offer 215 ILCSof a deductible applicable to 5/456(1)(e)the medical benefit only.Rating plan shall contain a mandatory offer ofa deductible applicable only to the medicalbenefit under the Work Comp Act (820 ILCS3-5/1 et seq.). Such deductible offer shall be ina minimum amount of at least 1000 peraccident.OTHER INSURANCEREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSRequirements for "OtherInsurance" provisions.215 ILCS5/143(2)REBATESREFERENCE DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTSPayments or ac

Must have proper Class and Clause authority to conduct this line of business in Illinois. 215 ILCS 5/4 List of Classes/Clauses To write Workers' Compensation insurance in Illinois, companies must be licensed to write: 1. Class 2, Clause (d) To write Employers Liability insurance in I