Illinois Senate Bill 714: Stricter Oversight on Auto Insurance Premiums

The Illinois Secretary of State, Alexi Giannoulias, has stressed the urgent need for more stringent oversight of auto insurance companies due to ongoing premium increases affecting drivers. Senate Bill 714, having secured approval from the Illinois General Assembly in May, now awaits the governor's signature. This proposed legislation seeks to empower Illinois regulators to assess and contest insurance rate hikes deemed excessive.

Key features of the bill include requiring insurers to provide a minimum of 30 days' notice for any auto insurance renewal premium increase exceeding 10%. Furthermore, it would prohibit the application of rates that are excessive, inadequate, or unfairly discriminatory, not reflective of the actual risk posed by drivers. The Illinois Department of Insurance would be granted enhanced authority to scrutinize rate filings, dispute unjustified increases, and mandate rebates for overcharged consumers. Additionally, insurers would be restricted from attributing out-of-state disaster-related losses to Illinois driver premiums.

Developed over several years, this bill incorporates insights from the Driving Change campaign, which collected consumer feedback on premium increases, and an independent study by O’Neil Risk Consulting & Algorithmic Auditing. This study underscored significant premium hikes based on non-driving-related factors such as credit scores and educational background. Giannoulias emphasizes that the legislation aims to instill the necessary transparency, accountability, and protection for consumers, as Illinois experiences an average 18% rise in auto insurance premiums since 2024. If approved, Senate Bill 714 would become effective on July 1, 2027.