Illinois Bill to Oversee Homeowners Insurance Rate Changes
State Representative Sharon Chung has introduced a bill to initiate discussions between state legislators and insurance companies regarding regulatory oversight. Representing Bloomington-Normal, home to major insurers State Farm and Country Financial, Chung responded to Governor JB Pritzker's proposal that aims to impose stricter pricing controls on Illinois homeowners insurance providers.
Chung voiced concerns about the exclusion of insurance companies from legislative discussions during the recent veto session, where the bill failed to pass. Her proposal seeks to empower the Illinois Department of Insurance to approve or deny rate changes proposed by insurers, as current Illinois regulations do not encompass rate control for insurance.
The bill delineates the criteria insurers must meet to secure rate change approval and specifies that denied rate changes do not necessitate reimbursement. Pritzker's previous efforts to enforce stricter regulations followed State Farm's 27% property insurance premium hike. Illinois legislators also proposed amendments mandating rebates for overcharges, leading to opposition from insurers and stalling the bill.
Chung expressed that Pritzker's strategy might reduce market competitiveness, emphasizing the need for insurer collaboration to address external factors affecting rate hikes, such as climate change and extreme weather conditions. Her proposal aims to lay the groundwork for cooperation with various interest groups and clarify rate submission requirements for insurers.
Chung called for regulations addressing external elements like deceptive roofing repair offers post-storms, which impact insurance costs. She advocated for a comprehensive regulatory approach extending beyond insurer-focused solutions.
State Farm, opposing the governor's proposal, expressed no objection to Chung's bill. State Farm spokesperson Gina Morss-Fischer remarked, “Although State Farm does not believe additional homeowners rate regulation is needed, we would not oppose HB 5619 as it aligns with laws in several other states.”
Brooke Kelley, APCIA's assistant vice president of state government relations and representing Country Financial, criticized Pritzker’s proposal, which could increase rates, but acknowledged Chung’s bill as more balanced. Both Kelley and Morss-Fischer showed willingness to work with Illinois authorities to reduce premiums. Chung stressed the urgency for legislative advancements in the spring session, deeming Pritzker’s proposal a “non-starter.”