INS-MOTOR VEHICLE REPAIR

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SB3536 - 104th General Assembly

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3536

Introduced 2/5/2026, by Sen. Chapin Rose

SYNOPSIS AS INTRODUCED:

215 ILCS 5/154.6

from Ch. 73, par. 766.6
215 ILCS 5/155.29a new

Amends the Illinois Insurance Code. Defines terms. Provides that
"insurer" means a company, firm, partnership, association, order, society,
or system that is obligated to pay at least part of the cost of repairing
the exterior of an insured's motor vehicle under an insurance policy
issued by the company, firm, partnership, association, order, society, or
system. Provides that an insurer may not direct a body shop to repair an
insured's motor vehicle until the insurer or its agent has given the
insured written notice that meets certain requirements. Sets forth
requirements for the content of the written notice. Provides that an
insurer or its agent shall give an insured an opportunity to indicate in
writing the type of body parts that the insured approves for use in the
repair of the insured's motor vehicle. Provides that an insurer who
violates certain requirements commits an improper claims practice.
Provides that the requirements of the amendatory provisions apply only for
5 years after the model year of the applicable motor vehicle. Provides that
the requirements of the amendatory provisions may be fulfilled on behalf
of an insurer by the body shop that is directed by the insurer to repair
the applicable motor vehicle. Makes a conforming change.
LRB104 17057 BAB 30472 b

A BILL FOR

SB3536
LRB104 17057 BAB 30472 b
1

AN ACT concerning regulation.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Illinois Insurance Code is amended by
5
changing Section 154.6 and by adding Section 155.29a as
6
follows:

7

(215 ILCS 5/154.6)

(from Ch. 73, par. 766.6)
8

Sec. 154.6.
Acts constituting improper claims practice.
9
Any of the following acts by a company, if committed without
10
just cause and in violation of Section 154.5, constitutes an
11
improper claims practice:
12

(a) Knowingly misrepresenting to claimants and insureds
13
relevant facts or policy provisions relating to coverages at
14
issue;
15

(b) Failing to acknowledge with reasonable promptness
16
pertinent communications with respect to claims arising under
17
its policies;
18

(c) Failing to adopt and implement reasonable standards
19
for the prompt investigations and settlement of claims arising
20
under its policies;
21

(d) Not attempting in good faith to effectuate prompt,
22
fair and equitable settlement of claims submitted in which
23
liability has become reasonably clear;

SB3536
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LRB104 17057 BAB 30472 b
1

(e) Compelling policyholders to institute suits to recover
2
amounts due under its policies by offering substantially less
3
than the amounts ultimately recovered in suits brought by
4
them;
5

(f) Engaging in activity which results in a
6
disproportionate number of meritorious complaints against the
7
insurer received by the Insurance Department;
8

(g) Engaging in activity which results in a
9
disproportionate number of lawsuits to be filed against the
10
insurer or its insureds by claimants;
11

(h) Refusing to pay claims without conducting a reasonable
12
investigation based on all available information;
13

(i) Failing to affirm or deny coverage of claims within a
14
reasonable time after proof of loss statements have been
15
completed;
16

(j) Attempting to settle a claim for less than the amount
17
to which a reasonable person would believe the claimant was
18
entitled, by reference to written or printed advertising
19
material accompanying or made part of an application or
20
establishing unreasonable caps or limits on paint or materials
21
when estimating vehicle repairs;
22

(k) Attempting to settle claims on the basis of an
23
application which was altered without notice to, or knowledge
24
or consent of, the insured;
25

(l) Making a claims payment to a policyholder or
26
beneficiary omitting the coverage under which each payment is

SB3536
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LRB104 17057 BAB 30472 b
1
being made;
2

(m) Delaying the investigation or payment of claims by
3
requiring an insured, a claimant, or the physicians of either
4
to submit a preliminary claim report and then requiring
5
subsequent submission of formal proof of loss forms, resulting
6
in the duplication of verification;
7

(n) Failing in the case of the denial of a claim or the
8
offer of a compromise settlement to promptly provide a
9
reasonable and accurate explanation of the basis in the
10
insurance policy or applicable law for such denial or
11
compromise settlement;
12

(o) Failing to provide forms necessary to present claims
13
within 15 working days of a request with such explanations as
14
are necessary to use them effectively;
15

(p) Failing to adopt and implement reasonable standards to
16
verify that a repairer designated by the insurance company to
17
provide an estimate, perform repairs, or engage in any other
18
service in connection with an insured loss on a vehicle is duly
19
licensed under Section 5-301 of the Illinois Vehicle Code;
20

(q) Failing to provide as a persistent tendency a
21
notification on any written estimate prepared by an insurance
22
company in connection with an insured loss that Illinois law
23
requires that vehicle repairers must be licensed in accordance
24
with Section 5-301 of the Illinois Vehicle Code;
25

(q-5) Violating subsection (e) of Section 155.29a;

26

(r) Failing to pay the replacement vehicle use or

SB3536
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LRB104 17057 BAB 30472 b
1
occupation tax, title, and transfer fees required by Section
2
154.9 of this Code;
3

(s) Engaging in any other acts which are in substance
4
equivalent to any of the foregoing.
5
(Source: P.A. 102-69, eff. 7-1-22
.)

6

(215 ILCS 5/155.29a new)
7

Sec. 155.29a.
Motor vehicle insurance; body parts used in
8
the repair of a motor vehicle.

9

(a) As used in this Section:
10

"Body part" means a replacement for any of the
11
nonmechanical sheet metal or plastic parts that generally
12
constitute the exterior of a motor vehicle. "Body part"
13
includes the inner and outer panels of the body of a motor
14
vehicle.
15

"Body shop" means a business that repairs damage to the
16
exterior of motor vehicles.
17

"Insured" means a person who is entitled to the coverage
18
provided by an insurance policy.
19

"Insurer" means a company, firm, partnership, association,
20
order, society, or system that is obligated to pay at least
21
part of the cost of repairing the exterior of an insured's
22
motor vehicle under an insurance policy issued by the company,
23
firm, partnership, association, order, society, or system.
24
"Insurer" includes associations operating as Lloyds,
25
reciprocal or inter-insurers, and individual underwriters.

SB3536
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LRB104 17057 BAB 30472 b
1

"Motor vehicle" means a vehicle that is self-propelled.
2
"Motor vehicle" does not include a farm tractor, an implement
3
of agriculture designed to be operated primarily in a farm
4
field or on farm premises, an electric bicycle, an electric
5
foot scooter, or an electric personal assistive mobility
6
device.
7

"New body part" means a body part that has not previously
8
been attached to a motor vehicle.
9

"Used body part" means a body part that has previously
10
been attached to a motor vehicle.
11

(b) An insurer may not direct a body shop to repair an
12
insured's motor vehicle until the insurer or its agent has
13
given the insured written notice that meets the requirements
14
set forth in subsection (c).
15

(c) An insurer or its agent shall give an insured written
16
notice that complies with the following:
17

(1) the written notice informs the insured that the
18

insured has a right to approve the type of body parts used
19

in the repair of the motor vehicle; and
20

(2) the written notice gives the insured an
21

opportunity, in approving the type of body parts used in
22

the repair of the motor vehicle, to select from the
23

following categories:
24

(A) new body parts manufactured by or for the
25

manufacturer of the motor vehicle;
26

(B) new body parts that were not manufactured by

SB3536
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LRB104 17057 BAB 30472 b
1

or for the manufacturer of the motor vehicle; and
2

(C) used body parts.
3

(d) An insurer or its agent shall give an insured an
4
opportunity to indicate in writing the type of body parts that
5
the insured approves for use in the repair of the insured's
6
motor vehicle.
7

(e) An insurer who does any of the following actions
8
commits an improper claims practice under Section 154.6:
9

(1) the insurer or its agent does not give an insured
10

written notice and directs a body shop to repair the
11

insured's motor vehicle;
12

(2) the insurer or its agent does not meet the
13

requirements set forth in subsection (c) or (d) and
14

directs a body shop to repair the insured's motor vehicle;
15

(3) the insurer or its agent gives an insured an
16

opportunity to indicate in writing the type of body parts
17

that the insured approves for use in the repair of the
18

insured's motor vehicle and directs a body shop to repair
19

the motor vehicle using a type of body part that is
20

different from the type of body part that the insured
21

approved; or
22

(4) the insurer or its agent gives an insured an
23

opportunity to indicate in writing the type of body parts
24

that the insured approves for use in the repair of the
25

insured's motor vehicle and refuses to pay for the type of
26

body parts that the insured approved or refuses to direct

SB3536
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LRB104 17057 BAB 30472 b
1

a body shop to use the type of body parts that the insured
2

approved in the repair of the motor vehicle.
3

(f) The requirements of this Section apply only for 5
4
years after the model year of the applicable motor vehicle.
5

(g) The requirements of this Section may be fulfilled on
6
behalf of an insurer by the body shop that is directed by the
7
insurer to repair the applicable motor vehicle.

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