Opinion ID: 447559
Heading Depth: 2
Heading Rank: 1

Heading: Statutory Immunity Under Section 143.18.

Text: 25 Section 143.18 of the Illinois Insurance Code provides: 26 Liability of company or agents regarding statements made in notices or information. There shall be no liability on the part of and no cause of action of any nature shall arise against any company, its authorized representative, its agents, its employees, or any firm, person or corporation furnishing to the company information as to reasons for cancellation, or nonrenewal, for any statement made by any of them in any written notice of cancellation or nonrenewal, or any other communications, oral or written, specifying the reasons for cancellation or nonrenewal, or for the providing of information pertaining thereto. 27 IAI does not argue that the district court left genuine issues of fact unresolved in holding that the Illinois statutory provision blocked its claims. It argues, rather, that the district court erred on the law, and that section 143.18 was not intended to bar these claims; and that if applied to bar these claims the section would be unconstitutional. 28
29 IAI contends that since Illinois requires insurance companies to give reasons for cancellation and nonrenewal of policies, 73 S.H.A. Secs. 755.15-755.17, the purpose of the Illinois legislature in passing the immunity provision was to protect insurance companies from claims by the insured, who might take issue with the reasons for cancellation or nonrenewal. Hence, according to IAI, the provision was intended to bar suits by the insured, but not suits by third parties, including brokers. 30 The language of the statute is not ambiguous. There shall be no liability on the part of, and no cause of action of any nature shall arise against any company, its agents, representatives, employees or informants, for any statement made in any written notice of cancellation or nonrenewal giving reasons for such action. Unless there is a persuasive reason to the contrary, words in statutes should be given their common meanings. In re Clark, 738 F.2d 869, 872 (7th Cir.1984); Ulane v. Eastern Airlines, Inc., 742 F.2d 1081, 1085 (7th Cir.1984). Here the words used are plain enough; the statute bars all such suits. 31 Moreover, a careful reading of the statute shows that its sole purpose cannot be to protect insurance companies, since the statute immunizes not only the companies, but anyone who provides them the information used in letters of cancellation or nonrenewal. The broader purpose seems to be to protect and insure the flow of information, presumably for the ultimate protection of the consumer of insurance: the theory is that the insured who can learn of and dispute misinformation conveyed to his insurance company is better off than one who cannot learn of such misinformation because of the company's fear of a lawsuit. If protection of the flow of this information is what is sought, then it is reasonable to protect this flow against all suits, as the legislature has apparently chosen to do. 32 IAI raises the North Dakota case of Emo v. Milbank Mutual Ins. Co., 183 N.W.2d 508 (N.Dak.1971), in which the North Dakota Supreme Court, discussing a similar provision in the North Dakota Insurance Code, said, [i]t is our view that the Legislature intended to protect an insurance company from libel actions brought on behalf of the policy holder and none other. 183 N.W.2d at 515. IAI's appeal to Emo is not persuasive. With due respect to the North Dakota court, it seems to us that the purposes underlying the Illinois statute--as we discern them--cannot be served by protecting the delivery of information only against suits by the insured; if it is in the interest of consumers to know why their insurance policies are being terminated, it is certainly in their interest to know when their policies are being terminated, as in the case before us, because of the behavior of a third party. If such information is not protected, then it is less likely to be available; and for that reason, and because we think it would not have been difficult for the Illinois legislature, had it so elected, to limit the statute to prohibit suits only by the insured, it seems to us that the statute must be read as it is written to bar all suits. 33 We conclude, therefore, that neither the language of section 143.18 nor the policy underlying it supports IAI's position that this statutory provision does not apply in this case. 34
35 IAI also claims that section 143.18 as applied to these facts is unconstitutional. It claims that the provision is special legislation for the benefit of insurance companies; that it denies equal protection to individuals and companies who transact business with insurance companies; and that it violates Article I, Sec. 12 of the Illinois Constitution, which guarantees a remedy for every wrong. 36 These claims are without merit. In Anderson v. Wagner, 79 Ill.2d 295, 37 Ill.Dec. 558, 402 N.E.2d 560 (1979), the Illinois Supreme Court said that where legislation treats one class of persons differently from another class, the classifications must be reasonably related to the legislative purpose and it must appear that there is a sound basis for regarding the class as distinct and separate for the purpose of legislation. 402 N.E.2d at 572. Here the class protected consists of insurance companies, together with their agents, representatives and employees and all those who provide them with information, and the protection extends only to information or misinformation conveyed in letters of cancellation or nonrenewal. If the purpose of the legislation is to insure the free flow of information in such letters, as we think it is, then the classification chosen is reasonably related to that purpose. It protects all who provide information, and not just insurance companies. 37 IAI also argues that the legislation works against a class of injured parties, those allegedly defamed, in a way that deprives them of the equal protection of the laws. There is no way to erect a defense to defamation without taking a right of action away from those allegedly defamed. If the class of persons protected is reasonable, it is difficult to see how the class of persons the legislation works against could be unreasonable. IAI does not call the purpose behind the statute into question; nor has it argued that any group of persons situated similarly to the protected class is not bound by the statute. See Vogel v. Robison, 80 Ill.App.3d 312, 35 Ill.Dec. 622, 399 N.E.2d 688, 689-90 (1980); Tyrken v. Tyrken, 63 Ill.App.3d 199, 19 Ill.Dec. 932, 379 N.E.2d 804, 808 (1978). 38 And finally this same point answers the claim that the legislation violates the Illinois Constitution. Whenever a defense is erected, a class of rights of action is eliminated. To say that the defense leaves a wrong without a remedy would make every defense a violation of the Illinois Constitution. Such a result is wholly unacceptable, and has been rejected by the Illinois courts. See Tyrken v. Tyrken, 379 N.E.2d at 807 (holding that the tort immunities created by the Right of Married Women Act do not violate the Illinois Constitution). 39 The district court was correct, therefore, in its conclusion that Section 143.18 bars IAI's tort claims.