INSURANCE-AUTOMOBILE COVERAGE

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3823

Introduced 2/6/2026, by Sen. Ram Villivalam

SYNOPSIS AS INTRODUCED:

See Index

Amends the Illinois Insurance Code. Provides that no company may
impose renewal premium increases of more than 10% for specified lines of
business unless the company mails or delivers by electronic means to the
named insured and by electronic means to the Department of Insurance
notice of the increase in renewal premium at least 60 days prior to the
renewal or anniversary date. Provides that the rates and premium charges
for every policy of automobile liability insurance shall include
appropriate reductions as determined by the insurer for any insured over
age 55 upon successful completion of the National Safety Council's
Defensive Driving Course or a motor vehicle crash prevention course,
including an eLearning course, that is found by the Secretary of State to
meet or exceed the standards of the National Safety Council's Defensive
Driving Course's 4-hour (rather than 8-hour) classroom safety instruction
program or eLearning course. Creates the Rates for Automobile Insurance
Article. Provides that rates shall not be excessive, inadequate, or
unfairly discriminatory. Provides that a rate is reasonable and not
excessive, inadequate, or unfairly discriminatory if it is an actuarially
sound estimate of the expected value of all future costs associated with an
individual risk transfer. Prohibits insurance providers from using an
insured's zip code; credit score, credit-based insurance score, or any
insurance score that uses or relies upon an insured's credit score; or age,
if the insured is over 65 years of age, in any manner that increases an
insured's premium, results in a nonrenewal of an insurance policy, or
leads to the cancellation of an insurance policy. Requires credible
State-specific loss experience to be used in the development of rates
whenever such data is available and statistically reliable, and, to meet
actuarial standards of credibility, insurers may supplement State-specific
loss experience with countrywide or regional loss experience. Makes other
changes. Effective January 1, 2027.
LRB104 20657 JDS 34155 b

A BILL FOR

SB3823
LRB104 20657 JDS 34155 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 143.17 and 143.29 and by adding Article
6
XLVIII as follows:

7

(215 ILCS 5/143.17)

(from Ch. 73, par. 755.17)
8

Sec. 143.17.
Notice of intention not to renew.
9

a. No company shall fail to renew any policy of insurance,
10
as defined in subsections (a), (b), (c), and (h) of Section
11
143.13, to which Section 143.11 applies, unless it shall send
12
by mail to the named insured at least 30 days advance notice of
13
its intention not to renew. The company shall maintain proof
14
of mailing of such notice on a recognized U.S. Post Office form
15
or a form acceptable to the U. S. Post Office or other
16
commercial mail delivery service. The nonrenewal shall not
17
become effective until at least 30 days from the proof of
18
mailing date of the notice to the name insured. Notification
19
shall also be sent to the insured's broker, if known, or the
20
agent of record, if known, and to the last known mortgagee or
21
lien holder. For purposes of this Section, the mortgagee or
22
lien holder, insured's broker, or the agent of record may opt
23
to accept notification electronically. However, where

SB3823
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LRB104 20657 JDS 34155 b
1
cancellation is for nonpayment of premium, the notice of
2
cancellation must be mailed at least 10 days before the
3
effective date of the cancellation.
4

b. This Section does not apply if the company has
5
manifested its willingness to renew directly to the named
6
insured. Such written notice shall specify the premium amount
7
payable, including any premium payment plan available, and the
8
name of any person or persons, if any, authorized to receive
9
payment on behalf of the company. If no person is so
10
authorized, the premium notice shall so state.
11

b-5. This Section does not apply if the company manifested
12
its willingness to renew directly to the named insured.
13
However,
no company may impose renewal premium increases of
14
more than 10% for lines of business enumerated in subsection
15
(a) of Section 143.13, unless the company mails or delivers by
16
electronic means, in compliance with Section 143.34, to the
17
named insured and by electronic means to the Department notice
18
of the increase in renewal premium at least 60 days prior to
19
the renewal or anniversary date. No

no
company may impose
20
changes in deductibles or coverage for any policy forms
21
applicable to an entire line of business enumerated in
22
subsections (a), (b), (c), and (h) of Section 143.13 to which
23
Section 143.11 applies unless the company mails
or delivers by
24
electronic means, in compliance with Section 143.34,
to the
25
named insured written notice of the change in deductible or
26
coverage at least 60 days prior to the renewal or anniversary

SB3823
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LRB104 20657 JDS 34155 b
1
date.
2

Notice shall also be sent to the insured's broker, if
3
known, or the agent of record.
For purposes of this subsection
4
b-5, policyholder-initiated changes to coverage and exposure
5
changes are not included in the renewal premium increases that
6
require a company to provide notice to the insured.

7

c. Should a company fail to comply with (a) or (b) of this
8
Section, the policy shall terminate only on the effective date
9
of any similar insurance procured by the insured with respect
10
to the same subject or location designated in both policies.
11

d. Renewal of a policy does not constitute a waiver or
12
estoppel with respect to grounds for cancellation which
13
existed before the effective date of such renewal.
14

e. In all notices of intention not to renew any policy of
15
insurance, as defined in Section 143.11 the company shall
16
provide the named insured a specific explanation of the
17
reasons for nonrenewal.
18

f. For purposes of this Section, the insured's broker, if
19
known, or the agent of record and the mortgagee or lien holder
20
may opt to accept notification electronically.
21
(Source: P.A. 100-475, eff. 1-1-18
.)

22

(215 ILCS 5/143.29)

(from Ch. 73, par. 755.29)
23

Sec. 143.29.
(a) The rates and premium charges for every
24
policy of automobile liability insurance shall include
25
appropriate reductions as determined by the insurer for any

SB3823
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LRB104 20657 JDS 34155 b
1
insured over age 55 upon successful completion of the National
2
Safety Council's Defensive Driving Course or a motor vehicle
3
crash prevention course, including an eLearning course, that
4
is found by the Secretary of State to meet or exceed the
5
standards of the National Safety Council's Defensive Driving
6
Course's
4-hour

8 hour
classroom safety instruction program
or
7
eLearning course
.
8

(b) The premium reduction shall remain in effect for the
9
qualifying insured for a period of 3 years from the date of
10
successful completion of the crash prevention course, except
11
that the insurer may elect to apply the premium reduction
12
beginning either with the last effective date of the policy or
13
the next renewal date of the policy if the reduction will
14
result in a savings as though applied over a full 3 year
15
period. An insured who has completed the course of instruction
16
prior to July 1, 1982 shall receive the insurance premium
17
reduction for only the period remaining within the 3 years
18
from course completion. The period of premium reduction for an
19
insured who has repeated the crash prevention course shall be
20
based upon the last such course the insured has successfully
21
completed.
22

(c) Any crash prevention course approved by the Secretary
23
of State under this Section shall be taught by an instructor
24
approved by the Secretary of State, shall consist of at least 8
25
hours of classroom or eLearning equivalent instruction and
26
shall provide for a certificate of completion. Records of

SB3823
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LRB104 20657 JDS 34155 b
1
certification of course completion shall be maintained in a
2
manner acceptable to the Secretary of State.
3

(d) Any person claiming eligibility for a rate or premium
4
reduction shall be responsible for providing to
the person's

5
his
insurance company the information necessary to determine
6
eligibility.
7

(e) This Section shall not apply to:
8

(1) any motor vehicle which is a part of a fleet or is
9

used for commercial purposes unless there is a regularly
10

assigned principal operator.
11

(2) any motor vehicle subject to a higher premium rate
12

because of the insured's previous motor vehicle claim
13

experience or to any motor vehicle whose principal
14

operator has been convicted of violating any of the motor
15

vehicle laws of this State, until that operator shall have
16

maintained a driving record free of crashes and moving
17

violations for a continuous one year period, in which case
18

such driver shall be eligible for a reduction the
19

remaining 2 years of the 3 year period.
20

(3) any motor vehicle whose principal operator has had
21

the principal operator's

his
drivers license revoked or
22

suspended for any reason by the Secretary of State within
23

the previous 36 months.
24

(4) any policy of group automobile insurance under
25

which premiums are broadly averaged for the group rather
26

than determined individually.

SB3823
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LRB104 20657 JDS 34155 b
1
(Source: P.A. 102-397, eff. 1-1-22; 102-982, eff. 7-1-23
.)

2

(215 ILCS 5/Art. XLVIII heading new)
3
ARTICLE XLVIII.

RATES FOR AUTOMOBILE INSURANCE

4

(215 ILCS 5/1801 new)
5

Sec. 1801.
Purpose.
The purpose of this Article is to
6
promote the public welfare by regulating automobile insurance
7
rates so that the rates will not be excessive, inadequate, or
8
unfairly discriminatory. Nothing in this Article is intended
9
to prohibit or discourage reasonable competition or to
10
authorize or encourage, except to the extent necessary to
11
accomplish the purpose of this Article, uniformity in
12
insurance rates, rating systems, rating plans, or practices.
13
This Article shall be liberally construed to carry into effect
14
the provisions of this Section.

15

(215 ILCS 5/1802 new)
16

Sec. 1802.
Applicability.
This Article applies to policies
17
of automobile insurance, as defined in subsection (a) of
18
Section 143.13.

19

(215 ILCS 5/1803 new)
20

Sec. 1803.
Rate standards; excessive, inadequate, or
21
unfairly discriminatory.

22

(a) Rates shall not be excessive, inadequate, or unfairly

SB3823
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LRB104 20657 JDS 34155 b
1
discriminatory.
2

(b) A rate is inadequate if it endangers the solvency of
3
the insurer.
4

(c) A rate is unfairly discriminatory if, after allowing
5
for practical limitations, the price differentials fail to
6
reflect the difference in expected losses and expenses. A rate
7
is not unfairly discriminatory if different rates result for
8
policyholders with similar loss exposures but different
9
expenses, or similar expenses but different loss exposures, so
10
long as the rate reflects the differences with reasonable
11
accuracy.
12

(d) A rate is reasonable and not excessive, inadequate, or
13
unfairly discriminatory if it is an actuarially sound estimate
14
of the expected value of all future costs associated with an
15
individual risk transfer.
16

(e) Insurance providers shall not use the following
17
factors in any manner that increases an insured's premium,
18
results in a nonrenewal of an insurance policy, or leads to the
19
cancellation of an insurance policy:
20

(1) an insured's zip code;
21

(2) an insured's credit score, credit-based insurance
22

score, or any insurance score that uses or relies upon an
23

insured's credit score; or
24

(3) an insured's age, if the insured is over 65 years
25

of age.

SB3823
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LRB104 20657 JDS 34155 b
1

(215 ILCS 5/1804 new)
2

Sec. 1804.
Determinations and notice; hearing.

3

(a) If the Department believes that a filing is excessive,
4
inadequate, or unfairly discriminatory pursuant to Section
5
1803, the Department shall send the company notice,
6
specifying: (1) in what respects the filing fails to meet the
7
requirements of this Article and (2) if applicable, any
8
modifications that are required. The notice shall specify a
9
reasonable period after which the filing is no longer
10
effective if the company fails to timely request a hearing
11
under subsection (b). If the company timely requests a hearing
12
under subsection (b), the filing shall remain in effect until
13
the conclusion of the hearing and a final order is issued. If
14
the Department finds that a rate is excessive, inadequate, or
15
unfairly discriminatory pursuant to this Article, the final
16
order may specify a reasonable period after which the filing
17
is no longer effective and any rebates that must be remitted to
18
affected consumers.
19

(b) The company may request a hearing on the notice within
20
10 days after receipt. Failure to request a hearing within 10
21
days shall be deemed the company's acceptance of the
22
Department's determination.

23

(215 ILCS 5/1805 new)
24

Sec. 1805.
Prohibition on cost-shifting.
Credible
25
State-specific loss experience shall be used in the

SB3823
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LRB104 20657 JDS 34155 b
1
development of rates whenever such data is available and
2
statistically reliable. To meet actuarial standards of
3
credibility, insurers may supplement State-specific loss
4
experience with countrywide or regional loss experience.
5
Nothing in this Section shall apply to rating relativity
6
development during ratemaking. This Section shall only apply
7
to companies issuing policies that are subject to this
8
Article.

9

Section 99.
Effective date.
This Act takes effect January
10
1, 2027.

SB3823
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LRB104 20657 JDS 34155 b
1

INDEX

2

Statutes amended in order of appearance

3

215 ILCS 5/143.17
from Ch. 73, par. 755.17
4

215 ILCS 5/143.29
from Ch. 73, par. 755.29
5

215 ILCS 5/Art. XLVIII
6

heading new
7

215 ILCS 5/1801 new
8

215 ILCS 5/1802 new
9

215 ILCS 5/1803 new
10

215 ILCS 5/1804 new
11

215 ILCS 5/1805 new

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