(215 ILCS 5/113.1) (from Ch. 73, par. 725.1)
(Section scheduled to be repealed on January 1, 2017)
Sec. 113.1. Effect of acceptance of certificate of authority.
(1) No foreign or alien company which accepts a certificate of authority or renewal certificate of authority to transact in this State any insurance business as described in Section 4 of this Code shall transfer by sale, contribution, merger, consolidation, reinsurance or otherwise, its direct policy obligations under insurance contracts with Illinois policyholders unless:
a. the transfer is made to a company authorized to
transact in this State the type of insurance business transferred; or
b. the transferring company gives 30 days prior
written notice to each policyholder to be transferred stating that the insurance contract and the company's liabilities thereunder are to be transferred to a specified insurer which is not subject to regulation by the Illinois Insurance Department or the administrative requirements of the Illinois Insurance Code; and
c. the unauthorized company to which the insurance
business is to be transferred makes and maintains a special deposit with the Director for the protection and benefit of all Illinois policyholders of such unauthorized company, in assets acceptable to the Director and having a fair market value not less than the required statutory reserves for the Illinois insurance business to be transferred.
(2) Any and all transfers resulting in the violation of this Section shall be construed as a violation of all applicable provisions of Article VII of this Code; including, but not limited to, Section 121-4 providing for liability to insureds for claims or insured losses not honored by the unauthorized insurer.
(3) Unless permitted by and obtained in compliance with this Section, or specifically authorized by another provision of this Code, it shall be unlawful for any unauthorized company to obtain as direct insurer any insurance contracts written in this State.
(Source: P.A. 86-753.)
Last modified: February 18, 2015