CIAB Threatens Suit On Illinois Agents Fees

By Mark E. Ruquet

NU Online News Service, June 4, 12:50 p.m. EDT?The Council of Insurance Agents & Brokers is threatening to sue the state of Illinois if it adopts a provision in its recently passed budget that would force non-resident agents to pay more for licensing fees than resident agents.

In a statement, the Washington, D.C.-based insurance broker association asked Illinois Gov. Rod R. Blagojevich to veto the increased licensing fee on agents because it creates a disparity in licensing fees. Under the new fee schedule, resident agents would pay $180 and non-residents $250.

"Erecting protectionist walls between Illinois and the rest of the United States is no way to balance a budget," said Ken Crerar, president of CIAB. "We urge the governor to use his line-item veto authority to strike this ill-conceived revenue-raiser from the state budget and continue Illinois' tradition of equal treatment of all who are engaged in commerce within the state."

CIAB said if the governor does not veto the increase, the association would "look into the possibility of challenging the disparity in the courts."

The Professional Independent Insurance Agents of Illinois said under the original budget proposal the two year license fee would have increased from $150 to $300. The Springfield, Ill.-based association said it lobbied to have these and other fees reduced to decrease the impact on the industry.

PIIAI said the budget also increases temporary insurance producer fees for two years from $25 to $50; limited line license from $25 to $50; surplus lines license from $200 to $400 a year; and increases the surplus lines tax from 3 percent to 3.5 percent.

The $52 billion Illinois budget, passed last Saturday, does not increase sales or income tax on residents, but does make budget cuts while increasing taxes and fees throughout the state. The budget increases spending on education, but eliminates 6,000 state employees and merges some agencies to cut costs.

According to Abby Ottenhoff, a spokesperson for the governor's office, the budget is currently under review and will not be signed until the review is completed.

Bill McAndrew, acting public information officer with the Illinois Department of Insurance, said the department is aware of CIAB's position on the matter, but has no comment at this time.

Special Reports /

CIAB Threatens Suit On Illinois Agents Fees

Related Stories

Recommended For You