If you drive in Illinois, you have probably felt it: auto-insurance premiums have climbed hard over the last few years. In 2026 the state responded with Illinois SB 714, a major auto-insurance reform that Governor JB Pritzker signed into law on August 4, 2026. But there is a lot of confusion about what this law actually does, and some of what is circulating online is simply wrong. This guide breaks down what SB 714 really changes, what it does not change, and what it means for you if you are injured by a driver who does not carry enough insurance.
The short version: SB 714 is a rate-oversight and affordability law, not a change to how much coverage drivers must carry and not a change to your right to bring an injury claim. Understanding that distinction matters, because the single biggest insurance problem injury victims face in Illinois is not the price of a policy, it is a policy that is too small to cover a serious injury.
What is Illinois SB 714?
SB 714 is an auto-insurance reform bill championed by the Illinois Secretary of State and Department of Insurance and passed by the General Assembly in 2026. Its central purpose is to give the Illinois Department of Insurance real authority over the rates auto insurers charge, and to add transparency and consumer protections to a market where premiums had been rising sharply. Governor Pritzker signed it into law on August 4, 2026, and its core provisions take effect on July 1, 2027.
Before SB 714, Illinois was one of the few states where regulators had very limited power to reject auto-insurance rates before they took effect. Illinois had operated under an open-competition system that largely trusted the market to keep prices in check. SB 714 changes that framework and moves Illinois toward the kind of prior-review authority most other states already use.
| Area | What SB 714 does |
|---|---|
| Rate review | Gives the Department of Insurance authority to review rate filings and challenge rates it finds unfair |
| Unfair pricing | Prohibits rates that are excessive, inadequate, or unfairly discriminatory |
| Renewal notice | Requires insurers to give advance notice before large renewal increases |
| Cost-shifting | Limits insurers from shifting out-of-state risks and costs onto Illinois drivers |
| Effective date | Core provisions begin July 1, 2027 |
What SB 714 actually does, provision by provision
1. Real rate oversight
The heart of SB 714 is giving the Illinois Department of Insurance the authority to review auto-insurance rate filings and challenge rates that are excessive, inadequate, or unfairly discriminatory. In practical terms, that means an insurer can no longer simply impose a steep rate increase without the possibility of regulatory scrutiny. This brings Illinois closer to the majority of states that already give their insurance regulators this kind of oversight, and it gives consumers a public body that can push back on increases they have no other way to challenge.
2. Advance notice of large increases
SB 714 requires insurers to give drivers meaningful advance notice before a large renewal increase takes effect. The goal is to end the experience of opening a renewal notice and discovering a double-digit jump with no warning and no time to shop for alternatives. With advance notice, drivers have a window to compare carriers, adjust coverage, or ask questions before the higher premium hits their account.
3. A ban on unfair and discriminatory pricing
The law reinforces that auto-insurance rates in Illinois may not be excessive, inadequate, or unfairly discriminatory. This is meant to curb pricing practices that penalize drivers based on factors that have little to do with how safely they actually drive. Consumer advocates had long argued that some rating factors functioned as proxies that unfairly raised rates for certain groups of drivers, and SB 714 gives regulators a clearer mandate to scrutinize them.
4. Protection from out-of-state cost-shifting
SB 714 also aims to prevent insurers from shifting the costs of out-of-state risks onto Illinois policyholders, so that Illinois drivers are rated based on Illinois conditions rather than subsidizing losses elsewhere. In a national insurance market, losses from catastrophic weather or litigation in other states can bleed into local pricing; this provision is designed to keep Illinois rates tied to Illinois experience.
Bottom line: SB 714 is about the price and fairness of auto insurance. It does not raise the minimum amount of coverage drivers must buy, and it does not change your right to be compensated after a crash.
What SB 714 does NOT do
This is where the online confusion is greatest, so it is worth being precise. SB 714 does not:
- Raise the state minimum liability coverage. Illinois still requires the same minimum limits (see below). SB 714 does not force drivers to carry more coverage.
- Change Illinois fault rules. Illinois remains a fault-based (at-fault) state using modified comparative negligence. You still recover from the driver who caused the crash, reduced by any share of fault assigned to you, and barred only if you are more than 50% at fault.
- Change the statute of limitations. The deadline to file most Illinois personal-injury lawsuits remains two years from the date of the crash.
- Guarantee lower premiums. Oversight can restrain unjustified increases, but it is not a rate rollback, and it does not promise that anyone’s premium will actually go down.
In other words, SB 714 is good news for household budgets, but it does not solve the problem that most often leaves injured people undercompensated: drivers who carry only the bare legal minimum.
How Illinois compares to other states
Most states use one of two systems to regulate auto-insurance rates: a prior-approval system, where the regulator must approve rates before they take effect, or a file-and-use system with meaningful review authority. For years, Illinois sat at the permissive end of that spectrum, giving the Department of Insurance little power to reject a rate before drivers were already paying it. SB 714 narrows that gap. It does not turn Illinois into the strictest state in the nation, but it ends the era in which auto-insurance increases went essentially unreviewed. For consumers, the meaningful change is that there is now a regulator with the authority, and the mandate, to ask insurers to justify what they charge.
Illinois minimum coverage today, and why it often is not enough
Illinois law requires every driver to carry liability insurance with minimum limits of $25,000 per person and $50,000 per accident for bodily injury, and $20,000 for property damage (commonly written 25/50/20). Illinois also requires uninsured-motorist coverage at those bodily-injury limits.
Here is the hard reality: in a serious crash, $25,000 does not go far. A single ambulance ride, emergency-room visit, and a few days in the hospital can exceed that limit before rehabilitation even begins. Add surgery, physical therapy, lost income, and follow-up care, and a genuinely serious injury can generate six or seven figures in damages. When the at-fault driver carries only minimum limits, the victim can be left with medical bills, lost wages, and long-term needs that dwarf the available insurance. SB 714 does nothing to change this, which is why the coverage you choose to carry matters so much.
The coverage that actually protects you: UM and UIM
Because so many drivers carry little or no insurance, the most important protection for most Illinois families is uninsured motorist (UM) and underinsured motorist (UIM) coverage on their own policy.
- Uninsured motorist (UM) coverage pays for your injuries when the at-fault driver has no insurance at all, or in a hit-and-run where the driver is never identified.
- Underinsured motorist (UIM) coverage fills the gap when the at-fault driver has some insurance, but not enough to cover your injuries.
Illinois requires UM coverage and offers UIM, and buying higher UM/UIM limits is often surprisingly affordable. It is one of the few insurance decisions that directly protects you and your family rather than other drivers. SB 714 does not require you to buy these higher limits, so the responsibility to protect yourself remains yours.
A real-world UIM example
Imagine you are seriously hurt by a driver who carries the state minimum of $25,000 in bodily-injury coverage, but your medical bills and lost wages total $150,000. The at-fault driver’s insurer pays its $25,000 limit, leaving a $125,000 shortfall. If you carried $150,000 in underinsured-motorist coverage, your own policy could then be tapped to help cover that gap (Illinois generally offsets the at-fault payment against your UIM limit). Without UIM, that $125,000 gap could fall entirely on you. This single example is the best argument for carrying UM/UIM limits well above the legal minimum, and it is a gap SB 714 leaves exactly where it was.
What damages can you recover after an Illinois car accident?
Whether your recovery comes from the at-fault driver’s policy, your own UM/UIM coverage, or a combination, Illinois law allows an injured person to seek both economic and non-economic damages. These commonly include:
- Medical expenses, both the bills you have already incurred and the reasonable cost of future care;
- Lost wages and lost earning capacity if your injuries keep you from working or limit what you can earn going forward;
- Pain and suffering for the physical pain caused by the crash;
- Disability and disfigurement, including scarring and permanent impairment;
- Loss of a normal life, the Illinois measure for the activities and experiences an injury takes from you; and
- Property damage to your vehicle and its contents.
In a wrongful-death case, surviving family members may also recover under the Illinois Wrongful Death Act for their grief, loss of companionship, and lost financial support. None of these categories are changed by SB 714; the law leaves the compensation system intact and simply adds oversight to how insurance is priced.
How an underinsured-motorist (UIM) claim works, step by step
UIM claims have their own rules and traps, and the process is different from a standard claim against the at-fault driver:
- Exhaust the at-fault policy first. In most cases you pursue and settle the at-fault driver’s liability coverage before turning to your own UIM coverage.
- Get your insurer’s consent before settling. Many policies require you to notify your own insurer and obtain consent before finalizing a settlement with the at-fault driver, so the insurer can preserve its right to seek reimbursement. Settling without consent can jeopardize your UIM claim.
- Present your UIM claim. You then make a claim against your own policy for the shortfall, up to your UIM limit, offset by what the at-fault driver already paid.
- Arbitration is common. Many Illinois UIM policies require disputes to be resolved through arbitration rather than a jury trial, which makes the presentation of medical evidence and damages especially important.
Because these steps are technical and a misstep can forfeit coverage, UIM claims are an area where legal guidance frequently makes the difference between a full and a partial recovery.
Can your own insurer deny a UIM claim?
Yes. Even though you pay for UM/UIM coverage, your own insurer becomes, in effect, the opposing party once you file that claim, and it may dispute the severity of your injuries, argue the other driver was not truly underinsured, or contend you failed to follow the policy’s notice or consent requirements. Illinois law requires insurers to act in good faith, and an insurer that unreasonably delays or denies a valid claim can face additional exposure. Still, the practical reality is that a UIM claim can be as hard-fought as any claim against a stranger’s insurer, which is another reason to have counsel involved early.
Why Illinois auto-insurance rates were rising
SB 714 did not appear in a vacuum. Illinois drivers had seen some of the steepest premium increases in the country, driven by a mix of factors: rising vehicle-repair and medical costs, more severe crashes, the growing expense of repairing vehicles packed with sensors and cameras, supply-chain effects on parts, and pricing models that regulators had little power to question. Lawmakers concluded that without oversight authority, there was no check on increases that consumers had no way to challenge. SB 714 is the state’s attempt to restore that check while leaving the underlying market intact.
What SB 714 means if you are injured in a crash
For someone who has been hurt by another driver, the practical takeaways are:
- Your claim process is unchanged. You still pursue the at-fault driver and their insurer, and your own UM/UIM coverage where it applies.
- Underinsurance is still the central risk. Because SB 714 did not raise coverage minimums, many at-fault drivers will still carry too little. Identifying every available policy, including your own UM/UIM, is essential.
- Rate oversight may reduce bad-faith pressure over time. A more closely regulated market can, in the long run, mean insurers are held to fairer standards, but that does not change how hard an insurer may fight your individual injury claim today.
This is exactly the kind of situation where experienced counsel matters. Insurers do not volunteer the full extent of available coverage, and combining multiple policies (the at-fault driver’s liability coverage plus your UM/UIM) is often the only way to fully compensate a serious injury.
Steps to take after a crash with an underinsured driver
If you are hit by a driver you suspect carries little or no insurance, a few steps protect your ability to recover:
- Call the police and get a report. An official crash report documents the other driver, their insurance (or lack of it), and the circumstances.
- Get medical care right away. Prompt treatment protects your health and creates the record that ties your injuries to the crash.
- Photograph everything. The vehicles, the scene, visible injuries, and road conditions.
- Do not give a recorded statement to the other insurer before speaking with a lawyer.
- Notify your own insurer promptly, because your UM/UIM coverage may come into play and those policies have their own notice deadlines.
- Talk to an attorney before accepting any settlement, especially a quick minimum-limits offer that may not reflect the true value of your claim.
Common insurance-company tactics to watch for
Whether the at-fault driver is well-insured or barely insured, injured people often encounter the same tactics: a fast, low settlement offer before the full extent of the injury is known; requests for a recorded statement that can be used against you; disputes about whether treatment was necessary; and pressure to sign broad medical-authorization forms. None of these are affected by SB 714. The best protection remains careful documentation and legal advice before you agree to anything.
How Phillips Law Offices helps after an underinsured-driver crash
At Phillips Law Offices, we routinely handle cases where the at-fault driver’s insurance is nowhere near enough to cover our client’s injuries. We investigate every possible source of recovery, including the at-fault driver’s liability policy, your own underinsured-motorist coverage, and any commercial or employer policies that may apply. We have represented injured people and families in Chicago since 1945, we work on a contingency-fee basis, and you pay nothing unless we recover for you.
To understand how Illinois crash rules fit together, you can also read our overviews of Illinois car-accident laws and how new Illinois laws affect personal-injury cases, or visit our Chicago car-accident page.
Frequently asked questions about Illinois SB 714
Does SB 714 lower my car-insurance premium?
Not automatically. SB 714 gives regulators authority to review and challenge unfair or excessive rates and requires notice of large increases, but it is not a rate rollback. Over time, oversight may restrain unjustified increases.
Does SB 714 change how much insurance I have to carry?
No. Illinois minimum coverage remains 25/50/20 (25,000 dollars per person and 50,000 dollars per accident for bodily injury, and 20,000 dollars for property damage). SB 714 addresses pricing, not coverage minimums.
When does SB 714 take effect?
Governor Pritzker signed SB 714 on August 4, 2026, and its core provisions take effect on July 1, 2027.
Does SB 714 affect my right to sue after a crash?
No. Illinois remains an at-fault state with modified comparative negligence, and the two-year statute of limitations for most injury claims is unchanged. Your right to pursue the at-fault driver is not affected.
If the driver who hit me had only minimum coverage, what can I do?
You may be able to use your own underinsured-motorist (UIM) coverage to make up the difference, and there may be additional policies in play, such as a commercial policy if the driver was working. An attorney can identify every available source of recovery.
Should I increase my UM/UIM coverage?
For most drivers, yes. Because so many at-fault drivers carry too little insurance, higher UM/UIM limits are one of the most valuable and affordable protections you can buy, and SB 714 does not require it for you.
Does SB 714 apply to commercial or trucking policies?
SB 714 focuses on the personal auto-insurance market. Commercial and trucking coverage is governed by separate rules and often involves far higher limits, which is one reason identifying a commercial policy after a crash can dramatically change the compensation available.
Is my UIM claim decided by a jury?
Often it is not. Many Illinois UIM policies require arbitration rather than a jury trial, which makes a well-documented presentation of your injuries and damages especially important.
Talk to a Chicago car-accident lawyer
If you have been injured by a driver who did not carry enough insurance, do not assume the at-fault policy is all that is available. Call (312) 346-4262 for a free, no-obligation consultation with Phillips Law Offices, or reach out through our website. We will review every policy that could apply to your case and explain your options at no cost.
This article is provided for general informational purposes and is not legal advice. Laws change and every case is different; for advice about your specific situation, speak with a licensed attorney.
