‘Controversial’ bill is harmful
I’m writing in response to Marni Pyke’s recent column on Senate Bill 1486 — Amendment 2, which she described as “controversial legislation.” But SB 1486 is more than controversial; it’s harmful to Illinois families. SB 1486 represents a sweeping and disruptive insurance regulatory change that, if enacted, could raise premiums, reduce consumer choice and inject significant uncertainty into a market that Illinoisans rely on for financial protection.
Before rushing into these drastic changes, lawmakers should consider commissioning an impartial study from experts at the University of Illinois Office of Risk Management & Insurance Research or the Illinois State University Katie School of Insurance and Risk Management. Illinois deserves data driven policymaking, especially when stakes are this high.
SB 1486 would replace Illinois’ long standing “use and file” system with an extreme “prior approval” model for both homeowners and auto insurance. Under this system, insurers must obtain government approval before adjusting rates — even when costs rise due to inflation, severe weather, or increased claims. States that have tried similar approaches, such as California, have seen insurers scale back operations or exit the market entirely, leaving consumers with fewer options and higher prices.
The consequences for Illinois consumers would be significant and hit their wallets hard. Homeowners’ insurance premiums could jump 20%, or $230 on average. Auto insurance premiums are also likely to increase.
These risks are real. Homeowners’ insurers in Illinois have experienced an 8.3% underwriting loss over the last decade and a staggering 30.3% loss in 2023 alone. Auto insurers have averaged a 2.7% underwriting loss over the last decade, even as Illinois auto insurance rates remain 18% below the national average.
Illinois has long benefited from one of the most competitive insurance markets in the country. SB 1486 introduces uncertainty, threatening that stability. We urge the state Senate to reject this bill.
Kevin Martin, Executive Director
Illinois Insurance Association
Springfield