Sec. 1703. Purpose and intent.
211 words·~1 min read·
/il/chapter-215/act-5/1703A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Sec. 1703. Purpose and intent. The purpose of this Article is to provide a mechanism for insurers to transfer or assume blocks of insurance business in an efficient and cost-effective manner that provides needed legal finality for such transfers in order to provide for improved operational and capital efficiency for insurance companies, while protecting the interests of the policyholders, reinsurers, and claimants of the subject business. This new process is intended to stimulate the economy by attracting segments of the insurance industry to this State, make this State an attractive home jurisdiction for insurance companies, encourage economic growth and increased investment in the financial services sector, and increase the availability of quality insurance industry jobs in this State.
These purposes are accomplished by providing a basis and procedures for the transfer and statutory novation of policies from a transferring insurer to an assuming insurer by way of an insurance business transfer without the affirmative consent of policyholders or reinsureds, but with consideration of their interests. This Article establishes the requirements for notice and disclosure and standards and procedures for the approval of the transfer and novation by a court pursuant to an insurance business transfer plan.
This Article does not limit or restrict other means of effecting a transfer or novation.