INS-FIRE & EXTENDED COVERAGE

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3827

Introduced 2/6/2026, by Sen. Michael E. Hastings

SYNOPSIS AS INTRODUCED:

215 ILCS 5/Art. XLVIII heading new
215 ILCS 5/1802 new
215 ILCS 5/1805 new
215 ILCS 5/1810 new
215 ILCS 5/1815 new
215 ILCS 5/1820 new

Amends the Illinois Insurance Code. Creates the Rates for Fire and
Extended Coverage Insurance Article. Provides that the Article applies to
policies of fire and extended coverage insurance and establishes policies
that are exempt from the Article. Provides that rates shall not be
excessive, inadequate, or unfairly discriminatory, as specified. Requires
each insurer to file with the Director of Insurance all rates and
supplementary rate information for risks that are to be written in this
State 20 days prior to the effective date of the rates. Sets forth
provisions concerning filing requirements for insurers in competitive and
noncompetitive markets and the monitoring duties of the Director
concerning market competition and the availability of insurance for the
policies of insurance to which the Article applies. Provides that a
competitive market is presumed to exist for a line of insurance unless the
Director, after a hearing, issues an order stating that a reasonable
degree of competition does not exist in the market. Provides that the
ruling of the Director regarding market competition is subject to judicial
review under the Administrative Review Law. Effective January 1, 2028.
LRB104 20373 BAB 33828 b

A BILL FOR

SB3827
LRB104 20373 BAB 33828 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
adding Article XLVIII as follows:

6

(215 ILCS 5/Art. XLVIII heading new)
7
ARTICLE XLVIII.

RATES FOR FIRE AND EXTENDED COVERAGE INSURANCE

8

(215 ILCS 5/1802 new)
9

Sec. 1802.
Purpose.
The purpose of this Article is to:
10

(1) Protect policyholders and the public against
11

excessive, inadequate, or unfairly discriminatory rates.
12

(2) Promote price competition among insurers to
13

provide rates that are responsive to competitive market
14

conditions.
15

(3) Provide regulatory controls in the absence of
16

competition.
17

(4) Maintain availability and reliability of
18

insurance.
19

(5) Promote the dissemination of price and other
20

information to enable consumers to purchase insurance
21

suitable for their needs and to foster competitive
22

insurance markets.

SB3827
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LRB104 20373 BAB 33828 b
1

(215 ILCS 5/1805 new)
2

Sec. 1805.
Applicability.
This Article applies to policies
3
of fire and extended coverage insurance, as defined in
4
subsection (b) of Section 143.13 of this Code, to which
5
Section 143.11 of this Code applies. This Article does not
6
apply to the following:
7

(1) policies for any commercial liability and property
8

insurance;
9

(2) policies for a structure, all or part of which is
10

leased or rented, regardless of whether the insured
11

occupied all or part of the structure as a primary
12

residence;
13

(3) policies for a structure that is unoccupied and
14

intended by the insured to be sold, leased, or rented or
15

policies for a structure that is unoccupied and under
16

active construction, renovation, or substantial
17

improvement and that is intended by the insured to be
18

sold, leased, or rented; and
19

(4) policies for a home or dwelling that is part of a
20

farm policy, regardless of whether the insured owned the
21

dwelling or occupied the dwelling as a primary residence.

22

(215 ILCS 5/1810 new)
23

Sec. 1810.
Rate standards.
Rates shall not be excessive,
24
inadequate, or unfairly discriminatory.

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LRB104 20373 BAB 33828 b
1

(1) Excessive rates.
2

(A) A rate in a competitive market is not
3

excessive.
4

(B) A rate in a noncompetitive market is excessive
5

if it is likely to produce a profit that is
6

unreasonably high for the insurance provided.
7

(2) Inadequate rates. A premium level is inadequate if
8

it endangers the solvency of the insurer.
9

(3) Unfairly discriminatory rates. Unfairly
10

discriminatory rates exist if, after allowing for
11

practical limitation, the price differentials fail to
12

reflect the difference in expected losses and expenses. A
13

rate is not unfairly discriminatory if different premiums
14

result for policyholders with similar loss exposures but
15

different expenses, or similar expenses but different loss
16

exposures, so long as the rate reflects the differences
17

with reasonable accuracy.
18

(4) A rate is reasonable and not excessive,
19

inadequate, or unfairly discriminatory if it is an
20

actuarially sound estimate of the expected value of all
21

future costs associated with an individual risk transfer.

22

(215 ILCS 5/1815 new)
23

Sec. 1815.
Filings of rates and other rating information.

24

(a) Each insurer shall file with the Director all rates
25
and supplementary rate information for risks that are to be

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LRB104 20373 BAB 33828 b
1
written in this State 20 days prior to the effective date of
2
the rates.
3

(b) In a competitive market, unless disapproved by the
4
Director, a filing meets the requirements of this Article and
5
becomes effective 20 days after its submission to the Director
6
or sooner if approved by the Director.
7

(c) In a noncompetitive market as determined under
8
subsection (b) of Section 1820, unless disapproved by the
9
Director, a filing meets the requirements of this Article and
10
becomes effective 60 days after its submission to the Director
11
or sooner if approved by the Director.

12

(d) Insurers must adhere to filings made under this
13
Section until the filings are amended or withdrawn.

14

(215 ILCS 5/1820 new)
15

Sec. 1820.
Monitoring competition; determining competitive
16
markets; hearing.

17

(a) The Director shall monitor competition and the
18
availability of insurance for the policies of insurance to
19
which this Article applies.
20

(b) A noncompetitive market shall only exist wherein, over
21
a 3-year period, the Herfindahl/Hirschman Index (HII)
22
consistently remains at 1800 or above, as determined through
23
the annual cost containment report required under Section 1200
24
of this Code.
25

(c) A competitive market is presumed to exist for a line of

SB3827
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LRB104 20373 BAB 33828 b
1
insurance unless the Director, after a hearing, issues an
2
order stating that a reasonable degree of competition does not
3
exist in the market. The burden of proof in any hearing shall
4
be placed on the party or parties advocating the position that
5
competition does not exist. Any ruling that a market is not
6
competitive shall identify the factors causing the market not
7
to be competitive. Such order shall expire no later than one
8
year after issue unless rescinded earlier by the Director or
9
unless the Director renews the rule after a hearing and a
10
finding as to the continued lack of a reasonable degree of
11
competition. Any ruling that renews the finding that
12
competition does not exist shall also identify the factors
13
that cause the market to continue not to be competitive.
14

(d)(1) In determining whether a reasonable degree of
15
competition exists within a line of insurance, the Director
16
shall consider at least the following factors:
17

(A) the number of insurers actively engaged in writing
18

coverage;
19

(B) market shares of the leading writers and the
20

changes in market shares over a reasonable period of time;
21

(C) the existence of financial or economic barriers
22

that could prevent new firms from entering the market;
23

(D) measures of market concentration and changes of
24

market concentration over time;
25

(E) whether long-term profitability for insurers in
26

the market is reasonable in relation to industries of

SB3827
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LRB104 20373 BAB 33828 b
1

comparable business risk; and
2

(F) the relationship of insurers' costs to revenue
3

over a reasonable period of time.
4

(2) All determinations by the Director shall be made on
5
the basis of findings of fact and conclusions of law.
6

(3) The ruling of the Director under this Section is
7
subject to judicial review under the Administrative Review
8
Law.
9

(e) The Director shall maintain by year whether the market
10
is competitive as of December 31 of each year.

11

Section 99.
Effective date.
This Act takes effect January
12
1, 2028.

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