HB6156 Summary: Health Insurance Contract Fairness Act

• Requires insurers to obtain prior approval from the Director of Insurance before rescinding or canceling accident and health insurance policies based on written application information, with specific procedures and timelines.

• Limits misrepresentation or false warranty defenses in insurance policies (except accident and health) to situations involving actual intent to deceive or material impact on risk acceptance.

• Establishes that health insurance issuers may only rescind coverage upon evidence of fraud or intentional misrepresentation of material fact in both group and individual markets.

• Sets 7 business days for insureds to review and respond to rescission applications, with Director required to issue written decision within 15 business days, and prohibits rescission approvals after claims are filed unless directly related to fraudulent information.

• Makes Health Maintenance Organizations subject to the prior approval requirements for health insurance rescissions under the Illinois Insurance Code.

• Effective July 1, 2010.