The Illinois Department of Insurance (“DOI”) will hold a public hearing on December 19 in Chicago regarding proposed amendments to the Illinois Administrative Code that address insurance policy rescissions. The DOI proposed the amendments in light of numerous complaints regarding rescissions based on an alleged misrepresentations or material changes in risk that, in the DOI’s estimation, did not form a legal basis for rescission. As the DOI stated in its description of the rule published in the Illinois Register, “the [DOI] believes it is necessary to clarify via rule that if a company opts not to obtain the readily available information for named insureds and drivers provided by the applicant at the time of application to underwrite the risk prior to issuing the policy, the company shall not defeat, avoid or rescind the policy of insurance based on obtaining the readily available information after a loss has occurred or a claim is filed.”
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