Quick answer: Governor Pritzker signed HB 4273 (homeowners) and SB 714 (auto) on August 4, 2026. Starting July 1, 2027, Illinois home and auto rates can't be "excessive, inadequate, or unfairly discriminatory," the Department of Insurance can object to filings and order rebates, and you must get 60 days' notice (home) or 30 days' notice (auto) before a renewal increase over 10%. The laws do not roll back today's rates, ban ZIP-code or credit-based pricing, or change anything before July 2027.
If you own a home or drive a car in Illinois, you have probably seen a headline about the state "finally" regulating insurance rates. The headlines are right about the big picture and fuzzy on the details. This is the plain-English version: what the two new laws actually say, what they don't, when they start, and what to do with your own policies in the meantime.
Why did Illinois need a rate review law at all?
Until this year, Illinois was unusual. According to St. Louis Public Radio, the state "exercises no control over insurance premiums" and, unlike most states, had no law on the books prohibiting excessive or unfairly discriminatory rates. Insurers filed rate changes with the Department of Insurance for information, but the Department had no power to say no.
Secretary of State Alexi Giannoulias, who pushed the auto bill, put it bluntly: Illinois and Wyoming were "one of only two states in America" without this kind of rate accountability, per Capitol News Illinois.
The political trigger was State Farm's homeowners rate increase in the summer of 2025, which St. Louis Public Radio reported at 27.2% in Illinois. Governor Pritzker called for homeowners rate oversight shortly after. (We covered the consumer side of that episode in what the State Farm dispute means for homeowners.)
Did the Governor actually sign the bills?
Yes. The Governor's office announced the signing of HB 4273 and SB 714 on August 4, 2026, and NBC Chicago and Capitol News Illinois (via WGLT) reported the same date. The homeowners bill is now Public Act 104-0752; the auto bill is Public Act 104-0753.
Both bills cleared the House on May 28, 2026, by votes of 72-38 (HB 4273) and 70-38 (SB 714), according to Capitol News Illinois. Rep. Thaddeus Jones of Calumet City sponsored both in the House. You can read the official text and history on the General Assembly's pages for HB 4273 and SB 714.
What does HB 4273 do for Illinois homeowners?
HB 4273 creates a new rate article in the Illinois Insurance Code for fire and extended coverage policies, which is the legal category that includes standard homeowners insurance. Here is what changes, piece by piece:
- A rate standard. Rates may not be "excessive, inadequate, or unfairly discriminatory," per The Sentinel. Insurance Business Mag notes the law defines an inadequate rate as one that "endangers the solvency of the insurer," so this cuts both ways: it is not only about rates being too high.
- 60 days' notice for big increases. An insurer must mail or electronically deliver notice at least 60 days before the renewal date if your renewal premium is going up more than 10%. Insurance Business Mag reports the same notice rule applies when the insurer changes deductibles or coverage across a line of business, with changes you asked for excluded.
- Illinois data for Illinois rates. Carriers must use "credible state-specific claims data" when it is available, and may supplement with national, regional, or out-of-state data only to meet actuarial credibility standards, per The Sentinel. The Governor's office describes the goal as stopping insurers from raising Illinois rates to cover disaster losses in other states.
- A 60-day review window. The Department of Insurance has 60 days from a complete filing to object. Insurance Business Mag reports that the deadline is "neither waivable nor subject to extension" and that a filing the Department doesn't challenge in time is "deemed compliant."
- Rebates. If the Department finds a rate excessive, it can order the insurer to stop using it and rebate affected customers. The insurer gets 30 days to request a hearing, per Insurance Business Mag.
What does SB 714 do for Illinois drivers?
SB 714 is the auto twin, with a few differences:
- Same rate standard: no excessive, inadequate, or unfairly discriminatory rates, and no shifting of out-of-state disaster costs onto Illinois drivers (Capitol News Illinois).
- 30 days' notice before a renewal premium increase of more than 10%, rather than 60 (Capitol News Illinois, Insurance Journal).
- A shorter review clock. Insurance Journal reports the Department has 40 days to notify an auto insurer that a filing fails the new requirements, versus 60 days on the homeowners side.
- Refunds for overcharges. The Department can order refunds to drivers if a rate is found excessive after a hearing (Insurance Journal).
- Defensive-driving discount for 55+. Capitol News Illinois reports SB 714 expands access to the defensive-driving discount for drivers 55 and older. An Illinois House Democrats release on the earlier House version described the qualifying course as a 4-hour program or e-learning course. If you are 55 or older, ask your agent about this when the law takes effect.
Don't want to wait until 2027 to find out if your rate is fair? We'll compare your exact coverage across 22+ carriers — free, no obligation, about 20 minutes. Rated 4.9 stars on Google.
Before vs. after July 1, 2027: what changes for you
| Topic | Before July 1, 2027 | On or after July 1, 2027 |
|---|---|---|
| Who checks whether a rate is fair | No one at the state level; filings were informational | Department of Insurance can object to filings that are excessive, inadequate, or unfairly discriminatory |
| Notice before a home renewal increase over 10% | No special requirement | At least 60 days (also for insurer-driven deductible or coverage changes) |
| Notice before an auto renewal increase over 10% | No special requirement | At least 30 days |
| Out-of-state disaster losses in Illinois rates | Not restricted | Rates must rest on credible Illinois loss data when available |
| If a rate is found excessive | No remedy | Department can order the rate withdrawn and rebates paid |
| Can the insurer use a new rate right away? | Yes | Yes; review happens after filing, within 60 days (home) or 40 days (auto) |
| ZIP code and credit-based pricing | Allowed | Still allowed; no specific ban |
What do the new laws NOT do?
This is where most of the misunderstanding lives, so it deserves its own section.
They don't roll back or freeze current rates. Nothing in either law reduces what you pay today. Insurance Director Ann Gillespie told NBC Chicago: "We have not changed the process for filing the rates in this bill. We have now changed the timing." Insurers can still put a new rate into effect when they file it; the state's review comes afterward (St. Louis Public Radio, The Sentinel).
They don't ban ZIP-code or credit-based pricing. Capitol News Illinois reported that SB 714 does not prohibit using ZIP codes or credit scores to set premiums, and the same is true of the homeowners law. The "unfairly discriminatory" standard gives the Department a tool to challenge a specific filing, but there is no outright ban. If credit is driving your premium, our guide to credit scores and insurance rates explains what you can do now.
They don't do anything until July 1, 2027. Both laws apply to rate filings and renewal notices on or after that date (Capitol News Illinois, The Sentinel). Your 2026 and early-2027 renewals are governed by the old rules.
They don't address the cost of claims. Industry groups argue this is the central weakness. The Illinois Insurance Association, APCIA, and NAMIC said in a joint statement reported by Insurance Journal that the laws "do nothing to address the factors driving premiums higher," citing severe weather, inflation, repair costs, and legal system abuse. Supporters counter that transparency itself is the point; the Governor's position, per Capitol News Illinois, is that "if you're telling your customers that rate hikes are necessary, you should be able to prove why." Both can be true: review may deter unjustified increases without changing what hail does to a roof.
What should Illinois homeowners and drivers do between now and July 2027?
The honest answer is: the same things that worked before the law passed, because for the next nine months the law has no effect on your renewal. Here is the short list.
1. Read every renewal, not just the total. Put this year's declarations page next to last year's and look for changes in dwelling coverage, deductibles (especially wind and hail), and discounts that fell off. Our step-by-step guide, what to do when your renewal goes up, walks through it.
2. Benchmark, but carefully. The NAIC's most recent Homeowners Insurance Report (2023 data) puts the average Illinois HO-3 premium at $1,480; see our Illinois home insurance guide. That figure is statewide, pre-dates the 2025 increases, and says nothing about your roof, your ZIP code, or your coverage limits. Use it as context, not a target.
3. Compare the same coverage across carriers. A captive agent can only quote one company's rate. An independent agent can price identical coverage across many carriers at once; the difference is explained in independent vs. captive agents. At Better Choice we compare 22+ carriers, and for existing clients we review every renewal and re-shop when an increase is out of line. If you'd rather start online, the quick quote form takes a couple of minutes.
4. Keep your roof file current. Roof age and condition drive a large share of Illinois homeowners pricing and nonrenewal decisions. Know whether your policy pays replacement cost or actual cash value on the roof; our ACV vs. replacement cost explainer covers why that matters more than most people think.
5. If you're dropped, act fast. The new 60-day notice rule for homeowners covers premium increases and insurer-driven coverage changes starting in 2027. If you receive a nonrenewal in the meantime, here is what to do when your insurance company drops you. If you believe a nonrenewal or rate is unfair, you can also file a complaint with the Illinois Department of Insurance or ask your agent to help you document it.
6. Leaving a captive carrier? Don't create a gap. Many of the Illinois homeowners calling us this year are State Farm customers reacting to the 2025 increase. Switching is fine; a lapse is not. See what switching from State Farm actually looks like.
One more note for clients with a foot in two states. Texas has had rate review for years, and the Texas Department of Insurance still reports a preliminary 2025 average homeowners premium of $3,489; see our Texas home insurance guide. Oversight changes who can object to a rate; it does not make hail cheaper. That is worth remembering if you own a home in Kane County and a rental in Fort Worth, where we compare Fort Worth home insurance the same way we do for St. Charles.
The bottom line
HB 4273 and SB 714 are real changes: for the first time, an Illinois regulator can tell a home or auto insurer that a rate is excessive and make it give the money back, and you will get meaningful warning before a double-digit increase. But they are also narrower than the headlines suggest. They start in July 2027, they don't touch today's rates, and they leave ZIP-code and credit-based pricing alone. Until then, and honestly after, the most reliable protection against an out-of-line renewal is the one you already have: compare. Start your free comparison or call us at (847) 908-5665.
Frequently Asked Questions
When does Illinois's new insurance rate review law take effect?
July 1, 2027. Both HB 4273 (homeowners) and SB 714 (auto) were signed on August 4, 2026, but the new rate standards, notice rules, and Department of Insurance review powers apply to rate filings and renewal notices on or after July 1, 2027. Until then, nothing about how your premium is set or reviewed changes.
Will the new law lower my Illinois home or auto insurance premium?
Not automatically. The laws do not roll back current rates or cap future ones. They let the Department of Insurance object to rates it finds excessive, inadequate, or unfairly discriminatory and order rebates if an objection stands after a hearing. Insurers can still put new rates into effect when they file them. Whether that leads to lower premiums depends on how the Department uses its new authority and on how carriers respond.
Does the new law stop insurers from using my ZIP code or credit score?
No. Capitol News Illinois reported that the bills do not prohibit the use of ZIP codes or credit scores in setting premiums. What the laws add is a general standard that rates cannot be unfairly discriminatory, which the Department of Insurance could use to challenge a specific filing, but there is no outright ban on either factor.
How much notice will I get before a big rate increase?
Starting with renewal notices sent on or after July 1, 2027, a homeowners insurer must give at least 60 days' notice before a renewal premium increase of more than 10%, and an auto insurer must give at least 30 days' notice before a renewal increase of more than 10%. The homeowners rule also covers changes to deductibles or coverage that the insurer applies across a line of business. Smaller increases are not covered by the new notice rules.
What should I do if my renewal goes up before the law kicks in?
Treat the renewal the way you would in any year: compare it with last year's declarations page, ask your agent what changed, and get the same coverage priced by other carriers before the renewal date. An independent agent can compare 22+ carriers in about 20 minutes for free. If you believe a rate or a nonrenewal is unfair, you can also file a complaint with the Illinois Department of Insurance.
Related Reading
- Your Insurance Renewal Went Up. Here's Exactly What to Do Next
- The State Farm Dispute: What It Means for Illinois Homeowners
- Thinking About Leaving State Farm? What Switching Looks Like
- My Insurance Company Dropped Me: What to Do
- Home Insurance Cost in Illinois 2026
About the author
Evan Larson — Licensed Insurance Agent at Better Choice Insurance Group, an independent insurance agency in St. Charles, Illinois licensed in 14 states.
Last reviewed: October 2026