Senate Bill 714 and House Bill 4273 Signed Into Law; Illinois Residents Likely to Experience Higher Home and Auto Insurance Costs and Fewer Coverage Options Amid Record[...]

The Illinois Insurance Association (IIA), the American Property Casualty Insurance Association (APCIA), and the National Association of Mutual Insurance Companies (NAMIC) today issued the following joint statement after Governor JB Pritzker signed Senate Bill 714 and House Bill 4273 into law.

"Illinois residents should be prepared for the potential impact of these new laws: higher home and auto insurance costs and fewer options for coverage.

"In recent months, powerful storms have repeatedly ripped through communities across Illinois, causing widespread damage to homes, vehicles, and infrastructure. Illinois now leads the nation in tornadoes - by a significant margin - and has already broken its all-time tornado record, even though the year is only halfway over. These trends underscore the growing volatility facing homeowners and insurers alike.

"Proponents of these measures claim the laws will protect consumers from rising insurance costs, but in reality, they do nothing to address the factors driving premiums higher, including more severe weather, inflationary pressures, higher repair and replacement costs and legal system abuse.

"Instead, the laws impose a fundamental shift in Illinois' regulatory environment, moving the state toward a more rigid rate-approval system similar to struggling insurance markets like California. This shift will make it harder for insurers to respond in real time to market conditions and adjust rates up or down based on actual claims experience.

"A recent U.S. News & World Report analysis found that Illinois has the sixth-lowest auto insurance premiums in the country - a direct result of strong competition, broad consumer choice and a regulatory framework that allows insurers to respond quickly to changing market conditions.

"These new laws, which put that success at risk, also highlight why it is essential that all stakeholders have a seat at the table throughout the legislative process. Policies developed without meaningful input from those responsible for serving consumers risk producing unintended consequences that could ultimately leave Illinois residents paying more while having fewer choices."