ILLINOIS

State law exempts charitable gift annuities from regulation (under Section 215 ILCS 5/121. To qualify, charity must be in continuous operation for 20 years* AND have an unrestricted fund balance of $2 million, not counting assets that are restricted to uses inconsistent with the payment of annuity obligations. These two requirements are waived, if charity reinsures it annuity agreements with a commercial insurance company registered to do business in Illinois.

A new Bill (STILL PENDING, not yet law) was filed in February, 2004 in the ILLINOIS State Senate (SB2831) to change the requirement of the organization being in active operation for 20 years (to 5 years) before the annuity agreement is issued to be exempt from the regulation that the annuity gift must be reinsured with a commercial insurance company, registered to do business in IL. The requirement that the charity must have $2 million or more as an "unrestricted fund balance" before accepting the annuity gift (unless it is re-insured) remains unchanged. Bill was sent to State Senate Rules Committee, where it resides today. For text of Senate Bill (SB2831), click here.

NO Disclosure wording required in agreement.

Charity must be in continuous operation for twenty years. See the 2004 entry below, AND the second bulleted item above.

Charity must have an "unrestricted fund balance" of at least $2 million (OR, see next bulleted item... )

The above two requirements are waived, IF the annuity agreements are re-insured with a commercial insurance company registered to do business in Illinois.

There is a provision in State Law for fine of $10,000 for non-compliance.

1999: Description of exemption from regulation offered by ILLINOIS Dept. of Insurance IF the charity will re-insure charitable gift annuity (CGA) with a commercial insurance company registered to do business in state of charity and Illinois, the state of residence of the CGA donor. For a descriptive statement by the Illinois Dept. of Insurance staff, click here.

2004: Requirement that charity be in continuous existence for Twenty (20) years in order to hold the assets of the charitable gift annuity and NOT be required to re-insure, is reduced to five (5) years. To see State Senate Bill (SB2831), click here.

This page last updated on June 13, 2005.