Illinois Industrial Insured / Independent Procurement (IP) Law Changes
Changes in the Illinois statutes took effect on January 1, 2015
that for the first time require insureds who qualify to independently procure insurance directly from an
unauthorized insurer to report those transactions and pay a tax. The reporting will be done through the
Surplus Line Association of Illinois and will be done online. Like our online surplus line transaction
reporting system, the reporting site is intuitive and easy to use.
You can access the registration/reporting site at:
Want a Quick Start overview? Click
Looking for a User Manual? Click here.
Third-Party Filer? Click here.
Some key points to remember:
- There are qualifications in the statute that must be met in order to independently procure insurance from an unauthorized insurer. The insured must be an "industrial insured" which includes meeting the definition of an "exempt commercial purchaser" and retaining a "qualified risk manager" and having Illinois as your "home state" -- as all these terms are defined in the law.
- The filing requirement and tax apply to any policy whose intial effective date is January 1, 2015 and later.
- For a policy, the filing must be made within 90 days of the effective date of the policy. For an endorsement, the filing must be made within 90 days of the issue date of the endorsment.
- Once you file a policy or endorsement, you'll get an invoice for the tax. That tax invoice must be paid within 30 days of the date you made the filing.
In order to make filings, first you will register to create an account with us. Information collected for registration will include company name and FEIN, name and contact information of the person making the filing, risk manager name and contact information (if different), filing contact address, and corporate headquarters address (if different). Upon submitting the registration information, your account will be confirmed and active within 1 business day. At that point you will be able to enter transactions. For each transaction, you will need just a few pieces of information: policy number, insurer, insured name and address, effective date, term, limit of liability, type of coverage and premium. The system will calculate all taxes and fees for you, and each will be rounded to the nearest whole dollar.
Once you submit a transaction, your invoice for association stamping fees will be emailed to you. The State will mail an invoice for taxes.
If you have questions as you complete the registration or filing process, please feel free to contact the Association.
To read the full text of the law as it now stands, see Section 121-2.08 of the Insurance Code.
To read the bill, showing the changes that were made to the law, see Public Act 098-0978.