Posted on 06/23/2003 8:50:02 PM PDT by cherry_bomb88
Session Review
With democrats in control of both chambers of the General Assembly and the Governor's office for the first time in almost three decades, the business and insurance industries were rightfully concerned about the prospects for dozens of anti-business proposals being enacted into law, as happened in the mid seventies under then-Governor Dan Walker. After a tumultuous six-month session, the results are a mixed bag-restraint on several anti-business substantive proposals, but significant increases in taxes and fees paid by businesses, insurers and insurance producers.
On the positive side, HB 1191-Sunshine in Litigation, the Illinois Trial Lawyers' proposal to open all civil litigation settlements for examination was not called for a third reading vote in the Senate. In addition, legislation reenacting Illinois Structural Work Act was never introduced. However, the prospect for both proposals to come up this fall or next spring remains strong. Democrats will be in control of the Governor's office and General Assembly for the foreseeable future and the proponents of these issues will undoubtedly continue advocating for their passage.
Take the time this summer and fall to remind your state legislators that these proposals will ensure that more businesses will leave Illinois and the cost of doing business, and insuring it, will go up for those who stay.
For the PIIAI, all four of our legislative initiatives are on the Governor's desk including restrictions on insurers use of credit scoring, revisions to the commercial renewal/nonrenewal statute, significant changes in the surplus lines law and a bill mandating that loss runs be sent to the producer at the request of the insured.
On the negative side, the Blagojevich administration enacted several one-time revenue schemes, including bonding the public pension fund contributions and selling the 10th casino license, in addition to permanent fee increases that will impact consumers across the board.
For the insurance industry specifically, the initial proposal literally doubled every fee and penalty in the insurance code, including the individual producer license fee and the business entity (agency) fee.
The PIIAI and the industry argued strenuously against the proposed fee and penalty increases, which we pointed out, would negatively impact individual consumers and businesses in an existing hard market. When it became apparent that no industry, including insurance, would escape higher fees, we lobbied successfully in substantially decreasing the impact upon insurance producers. Instead of a $150 increase across the board, PIIAI was able to negotiate a $30 increase in the individual two-year license for residents and a $100 increase for non-residents.
FEE SCHEDULE
TYPE CURRENT GOVERNOR'S PROPOSED FINAL (SB 1903)
Individual Producer License (CURRENT)$150 for 2 yr. license (PROPOSED)$300 for 2 yr. license
(FINAL CHANGE IN LAW)$180 for resident 2 yr. license and $250 for nonresident 2 yr. license
Temporary Ins. Producer(current) $25 for 2 yr. license (proposed)$50 for 2 yr. license (final)$50 for 2 yr. license
Business Entity (current)$50 for 2 yr. license (proposed)$300 for 2 yr. license(final) $150 for 2 yr. license
Limited Lines License (current)$25 for 2 yr. license(proposed) $50 for 2 yr. license (final) $50 for 2 yr. license
Surplus Lines License(current) $200 annual license (proposed)$400 annual license (final) $400 annual license
Public Adjuster (current)$30 annual license (proposed)$100 annual license(final) $100 annual license
Premium Finance(current) $200 annual license (proposed)$400 annual license (final) $400 annual license
Employee Leasing Company (current)$500 annual license (proposed)$1,000 annual license (final)$1,000 annual license
In addition, the insurance industry was hit with several other fee increases and elimination of tax offsets.
These include:
Motor Vehicle Reports: Doubling from $6 to $12 MVR fees, which are collected by the Secretary of State.
Financial Regulatory Fees: The Governor and General Assembly increased the fees by 50% and increased the Affiliated Group Maximum from $100,000 to $250,000 (Financial Regulatory Fees are those paid by the companies to cover the cost of DOI financial audits.)
Life & Health Insurance Guarantee Fund Tax Offset: The Governor and General Assembly eliminated the existing state tax offset that life and health insurers receive on assessments from the Life & Health Guarantee Fund.
Surcharge on Work Comp Premiums: A 1.5% surcharge on Work Comp Premiums and a 0.045% payroll tax on self-insureds to fund the Industrial Commission.
Increase in the Surplus Lines Tax: Increasing the surplus lines tax from 3% to 3.5%.
Increase in Securities Fees: Several increases in securities licensing and filing fees.
The FY04 budget will impact every individual and business insured, and you and your agency should take the proactive position of informing your insureds that as a result of the aforementioned increases the cost of providing their insurance coverage will increase.
(Excerpt) Read more at piiai.org ...
He will turn this state into a cesspool. These taxes will drive businesses out of state and the increases in fees and taxes will be passed down to the consumers, like you said. How can anyone be so obtuse???? These proposals hit home for my husband's business, my present business, and the one I hope to go into after I finish my degree, which happens to be insurance-related (which won't happen if I can't get financial aid because the illegal aliens deserve it more, poor them). Forgive the ranting, please.
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