ARTICLE I. Plan of Operation
This plan of operation (hereinafter the “Plan”) shall
become effective upon written approval of the Illinois Director of Insurance,
and shall constitute the manner in which the Surplus Line Association of
Illinois (hereinafter the “Association”) shall operate and discharge its
responsibilities in accordance with the Illinois Insurance Code.
ARTICLE II. Membership
A. Members. All persons licensed as surplus line
producers under the Illinois Insurance Code are members of the Association.
B. Voting. Each member shall have one vote and
shall be entitled to additional votes on the basis of one vote for each $1,000
($500 or more is rounded to the nearest $1,000) of net surplus line insurance
premium written in the State of Illinois during the previous calendar year as
shown by the Association’s records provided that the maximum number of
additional votes a member may be entitled to shall not exceed the votes that
would be evaluated on the basis of five per cent (5%) of the total net surplus
line insurance premium written in Illinois during the previous calendar year.
C. Consolidation. Any member shall be permitted to
consolidate his surplus line insurance premium writings with another member or
members for reporting, voting and all other purposes if the members are employed
by or associated with the same firm. In the event of such consolidation, the
member shall make a written delegation to the firm of all powers hereunder
including the determination of a quorum, the right to vote and to serve as a
director with a copy supplied to the Association. Consolidation and delegation
under this provision does not relieve the member of the responsibility for
compliance with this Plan, the Association’s procedures, or with the Illinois
Insurance Code and rules and regulations promulgated thereunder.
D. Annual Meeting. There shall be an annual meeting
of members which shall take place at a place to be designated in the State of
Illinois by the board of directors on the third Tuesday in April, unless the
board, upon proper notice, shall designate some other date. Twenty days written
notice of such annual meeting shall be given to all members. Such notice shall
incorporate or be accompanied by an agenda for the meeting. Members may be
present in person or represented by proxy. The members present in person or
represented by proxy shall constitute a quorum for the transaction of business
and the acts of a majority of the membership present in person or represented by
proxy at a meeting at which a quorum is present shall be the acts of the full
membership.
ARTICLE III. Directors
A. Board of Directors. The management of all the
affairs, property and business of the Association shall be vested in the board
of directors. The board shall consist of nine (9) individuals who reside in
Illinois and are either individual members or the designated representatives of
firm members and fairly represent the membership of the Association. The board
of directors shall be elected at the annual meeting of members to serve
three-year, non-concurrent terms.
B. Elections. The Chairman of the board shall
appoint a nominating committee subject to approval of the board of directors at
least 90 days before the annual meeting to nominate members to fill the expiring
terms of directors. The recommendations of the nominating committee shall be
announced at least 60 days before the annual meeting, and members shall be given
10 days after such announcement to make additional nominations of members who
have signified their willingness to stand for election. Ballots shall be mailed
to the members at least 30 days before the annual meeting indicating the
nominations by the nominating committee and any additional nominations. The
ballots shall be counted by tellers appointed by the Chairman and the results of
the election shall be announced at the annual meeting.
C. Vacancies. Vacancies on the board shall be filled
for the remaining period of the vacating director’s term by the board of
directors.
D. Actions. A majority of the board of directors
shall constitute a quorum for the transaction of business and the acts of a
majority of the directors present at a meeting at which a quorum is present
shall be the acts of the board, except that an affirmative vote of five (5)
directors is required to:
1. Approve contracts with
an annual obligation of $5,000 or more.
2. Adopt a schedule for
countersignature and other fees.
3. Borrow money.
4. Amend this Plan.
5. Authorize bank
signatures.
When such issues are presented to the directors at any
annual, regular or special meeting, those directors absent from such meeting may
be polled by the Chairman on such issues and any vote cast by such absentee
director on such issues shall be as valid as though such absentee director was
in fact present at the meeting for purposes of determining whether a quorum is
present and voting. Votes cast in this manner shall be subsequently confirmed in
writing by letter from such absentee director to the Chairman.
E. Directors’ Annual Meeting. An annual meeting of
the board of directors shall be held at the Association’s office or such other
place designated in the State of Illinois by the board of directors as soon as
possible after the annual meeting of members in order to elect officers.
F. Regular and Special Meetings. Regular meetings
of the board of directors shall be held monthly on the third Tuesday of each
month in order to review, consider and act on any matters deemed necessary to
the administration and purposes of the Association and the Illinois surplus line
law. The Chairman shall designate the date, time and place, which shall be in
the State of Illinois, of such regular meetings and may cancel or postpone any
regular meeting when in his judgment such cancellation or postponement will not
interfere with the business of the Association. Special meetings of the board of
directors may be called by the Chairman and shall be called at the request of
any three directors upon not less than 5 days written notice to each director of
the time and place, which shall be in the State of Illinois, and purpose or
purposes of any special meeting. Such notice for any special meeting may be
waived by written waiver signed by all the directors before or after such
meeting. At any regular or special meeting, the directors may consider and
decide any matter deemed to be necessary for the administration of the
Association.
G. Consent. Any action which may be taken at an
annual, regular or special meeting of the board, may be taken without a meeting
if a consent in writing, setting forth the action so taken, shall be signed by
all the directors entitled to vote at a meeting. Any such consent signed by all
the directors shall have the same effect as a unanimous vote.
H. Compensation; Reimbursement. Directors shall
serve without compensation but they may be reimbursed for necessary expenses
incurred by them as members of the board of directors.
ARTICLE IV. Officers
A. Officers. The officers of the Association to be
elected by the board of directors shall be a Chairman, a Vice-Chairman, a
Treasurer and a Secretary. They shall be elected at the board of directors’
annual meeting and shall hold office until the next directors’ annual meeting or
until their successors are elected and installed. The Chairman shall not be
elected to more than two consecutive one year terms.
B. Chairman. It shall be the duty of the Chairman
to preside at all meetings and to perform all duties usually pertaining to his
office. He shall be an ex-officio member of all committees.
C. Vice-Chairman. It shall be the duty of the
Vice-Chairman to perform all the duties of the Chairman during the absence of
the Chairman.
D. Secretary. It shall be the duty of the Secretary
to keep full minutes of the proceedings of all meetings of the Association and
of the board of directors and to perform all duties usually pertaining to his
office or as may be assigned by the board of directors.
E. Treasurer. It shall be the duty of the Treasurer
to report at the annual meeting of members the account of the funds of the
Association and of all receipts and disbursements and to perform all duties
usually pertaining to his office or as may be assigned by the board of
directors.
ARTICLE V. Operations
A. Address. The official address of the Association
shall be the permanent office of the Association.
B. Employees; Agents. The Association may employ
such persons, firms or corporations, attorneys or accountants, as are necessary
for the performance of the duties imposed on the Association.
C. Bank Accounts; Borrowing. The Association may
open one or more bank accounts. Reasonable delegation of deposit and withdrawal
authority to such accounts for Association business may be made consistent with
prudent fiscal policy. The Association may borrow money as the board of
directors in its judgment deems advantageous for the Association.
D. Budget and Fee Schedule. Prior to November 1 of
each year, the board of directors shall adopt a budget for the Association’s
operating and capital expenses and contingent expenses for the period January 1
to December 31 following. The budget shall take into account unknown and
unanticipated expenses as may reasonably occur and make provision for such
expenses in accordance with prudent business practice. Based upon the
anticipated volume of surplus line premium during the period, the board of
directors shall adopt a countersignature fee to be charged members on all
surplus line business submitted to the Association and may adopt a schedule for
an annual fee, minimum fees, fees for late or erroneous filings or payments, or
other fees approved by the board of directors. The countersignature fee and fee
schedule shall be submitted to the Director of Insurance for approval.
E. Payment of Fees. All members shall submit
surplus line insurance documents to the Association as required by the Illinois
Insurance Code and shall pay the fees therefor as required by the Association.
Any member who is more than 30 days delinquent in the payment of such fees may
be reported to the Director of Insurance provided, however, that any delinquency
of more than 60 days shall be reported to the Director of Insurance.
F. Countersignature Reports. The Association shall
record and countersign all surplus line insurance documents submitted to it
pursuant to the Illinois Insurance Code and shall prepare reports to the
Director of Insurance and to members as required therein and for such other
purposes as approved by the board of directors.
G. Procedures Manual. The Association shall prepare
and distribute a procedures manual to each member setting forth the procedure
for submitting surplus line insurance documents to the Association and other
matters germane to the operation of the Association.
H. Insurance. The Association shall procure such
bonds and insurance covering directors, officers, employees and agents of the
Association and the Association and its properties as it determines to be
appropriate for the Association and the members.
ARTICLE VI. Records and Reports
A. A written record of the proceedings of each board
meeting shall be retained by the Secretary with copies furnished to each
director.
B. The board of directors shall, once each year,
provide for an independent audit of all the books and records of the Association
and report of such independent audit shall be made to the board and the Director
of Insurance with a copy made available to each member to review at the
Association office.
ARTICLE VII. Indemnification
Any member of the board of directors, officer, employee or
agent of the Association (except the Director of Insurance and his
representatives) shall be indemnified by the Association against all expenses,
judgments, decrees, fines, penalties, amounts paid in settlement, or incurred in
the defense, of any action taken or not taken by such person in the performance
of his powers and duties under the Illinois Insurance Code and this Plan, unless
such person shall be finally adjudged to have committed a breach of duty
involving gross negligence, bad faith, dishonesty, willful misfeasance or
reckless disregard of his responsibilities. In the event of settlement before
final adjudication, such indemnity shall be provided only if the Association is
advised by independent counsel that such person did not, in counsel’s opinion,
commit such a breach of duty. The board of directors may purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Association against any liability asserted against him and incurred
by him in such capacity or arising out of his status as such, whether or not the
Association can indemnify him against such liability under this Article.
ARTICLE VIII. Dissolution
In the event the Association is dissolved and all its
liabilities have been satisfied, the board of directors shall determine an
equitable basis to distribute the remaining assets of the Association to the
members at the time the Association is dissolved or to transfer the remaining
assets to another non-governmental organization established for the same or
similar purpose as the Association.
ARTICLE IX. Amendments
This Plan may be amended at any annual, regular or special
meeting of the board of directors by the affirmative vote of not less than five
directors. Amendments shall be effective upon approval in writing by the
Director of Insurance.
|
