Bill Text: IL SB1943 | 2019-2020 | 101st General Assembly | Introduced

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Bill Title: Amends the Illinois Insurance Code. Provides that with respect to employers correctly classified within the construction industry, the amount charged to the insured for workers' compensation and employers' liability insurance shall be based upon hours worked by employees in specific job categories or classifications, not the wages or salaries paid to the employees. Makes technical changes.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2021-01-13 - Session Sine Die [SB1943 Detail]

Download: Illinois-2019-SB1943-Introduced.html

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101ST GENERAL ASSEMBLY State of Illinois 2019 and 2020 SB1943 Introduced 2/15/2019, by Sen. Linda Holmes SYNOPSIS AS INTRODUCED:
215 ILCS 5/456 from Ch. 73, par. 1065.3
Amends the Illinois Insurance Code. Provides that with respect to employers correctly classified within the construction industry, the amount charged to the insured for workers' compensation and employers' liability insurance shall be based upon hours worked by employees in specific job categories or classifications, not the wages or salaries paid to the employees. Makes technical changes.
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A BILL FOR
SB1943 LRB101 08721 RAB 53808 b
AN ACT concerning insurance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Insurance Code is amended by
changing Section 456 as follows:
(215 ILCS 5/456) (from Ch. 73, par. 1065.3)
Sec. 456. Making of rates.
(1) All rates shall be made in accordance with the
following provisions:
(a) Due consideration shall be given to past and
prospective loss experience within and outside this State
state, to catastrophe hazards, if any, to a reasonable
margin for profit and contingencies, to dividends, savings
or unabsorbed premium deposits allowed or returned by
companies to their policyholders, members or subscribers,
to past and prospective expenses both countrywide and those
specially applicable to this state, to underwriting
practice and judgment and to all other relevant factors
within and outside this State. state;
(b) The systems of expense provisions included in the
rates for use by any company or group of companies may
differ from those of other companies or groups of companies
to reflect the requirements of the operating methods of the

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any such company or group with respect to any kind of
insurance, or with respect to any subdivision or
combination thereof for which subdivision or combination
separate expense provisions are applicable. ;
(c) Risks may be grouped by classifications for the
establishment of rates and minimum premiums.
Classification rates may be modified to produce rates for
individual risks in accordance with rating plans that which
measure variation in hazards or expense provisions, or
both. The Such rating plans may measure any differences
among risks that have a probable effect upon losses or
expenses. ;
(d) Rates shall not be excessive, inadequate or
unfairly discriminatory.
A rate is excessive if it is likely to produce a profit
that is unreasonably high for the insurance provided or if
expenses are unreasonably high in relation to the services
rendered.
A rate is not inadequate unless the such rate is
clearly insufficient to sustain projected losses and
expenses in the class of business to which it applies and
the use of the such rate has or, if continued, will have
the effect of substantially lessening competition or the
tendency to create monopoly in any market.
Unfair discrimination exists if, after allowing for
practical limitations, price differentials fail to reflect

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equitably the differences in expected losses and expenses.
A rate is not unfairly discriminatory because different
premiums result for policyholders with like exposures but
different expenses, or like expenses but different loss
exposures, so long as the rate reflects the differences
with reasonable accuracy.
(e) The rating plan shall contain a mandatory offer of
a deductible applicable only to the medical benefit under
the Workers' Compensation Act. Such deductible offer shall
be in a minimum amount of at least $1,000 per accident.
(f) Any rating plan or program shall include a rule
permitting 2 or more employers with similar risk
characteristics, who participate in a loss prevention
program or safety group, to pool their premium and loss
experience in determining their rate or premium for such
participation in the program.
(g) With respect to an employer correctly classified
within the construction industry, the amount charged for
workers' compensation and employers' liability insurance
insuring the employees employed by an employer in any job
category or classification shall be based upon hours worked
by employees in that job category or classification and
shall not be based upon the wages or salaries paid to the
employees.
(2) Except to the extent necessary to meet the provisions
of subdivision (d) of subsection (1) of this Section,

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uniformity among companies in any matters within the scope of
this Section is neither required nor prohibited.
(Source: P.A. 100-1118, eff. 2-1-19.)