SPRINGFIELD, Ill. (WAND) — State senators passed a bill last week to protect homeowners from excessive insurance rate increases and ensure transparency for homeowners, but the plan failed to gain enough support in the House before veto session ended.
Sen. Michael Hastings (D-Frankfort) has consistently said there needs to be fairness and accountability within the insurance industry. His legislation would require insurance companies to give homeowners at least 60 days notice before nonrenewal, changes in coverage, and premium increases over 10%.
Insurers would also need to use credible Illinois specific data to set rates.
"It establishes that property insurance rates may not be excessive, inadequate, and unfairly discriminatory, and it must represent an actuarially sound estimate of future costs," Hastings said. "It requires the Department of Insurance to act on rate filings within 60 days."
The Illinois Department of Insurance would be able to review filings, issue orders, and require rebates if the rates are found unfair. However, Republicans argue these changes could force insurance companies to leave the state.
"This legislation destroys confidence insurance companies have in operating in Illinois because it calls into question the solvency and the creditworthiness of all 200 companies that will be offering this product in Illinois if this legislation passes," said Sen. Jason Plummer (R-Edwardsville).
House Bill 3799 passed out of the Senate on a 41-15 vote with one senator voting present.
A few hours later, House sponsors said lawmakers have a duty to look out for those who cannot win big battles on their own.
"There are few feelings more helpless than sitting at the kitchen table, opening an envelope, and seeing a bill that could put you out of your house and home," said House Majority Leader Robyn Gabel (D-Evanston). "$1,000-$2,000 increases, where is that going to come from?"
Still, House GOP leaders said Illinois is the thirteenth best priced market for insurance. Rep. Jeff Keicher (R-Sycamore) said home insurance rates have only gone up due to unprecedented storm claims over the past two years.
"There's not one piece of this bill that does anything to address the costs that cause all the anger from the consumers we serve," Keicher said.
The legislation failed to passed out of the House with a 56-37 vote. Six House Democrats voted present.
Lawmakers could try to gain more support for the proposal when they return to Springfield in mid-January.
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