STATE INSURANCE FUNDS; GENERAL PRINCIPLES
Continuation of funds.
Composition and integrity of funds.
Custody of assets and liability.
Ch. 604 Cross-reference
See definitions in ss. 600.03
Ch. 604 Note
NOTE: Chap. 117, laws of 1973, which created this chapter of the statutes, contained notes explaining the revision. See the 1973 session law volume.
This chapter applies to all insurance funds operated by this state under chs. 605
Continuation of funds. 604.02(1)
The following funds are continued:
The "local government property insurance fund" or "property fund".
The "state life insurance fund" or "life fund".
Composition and integrity of funds. 604.03(1)
Each fund consists of premium payments, earnings from investments, amounts recovered from reinsurers or under subrogation or contribution claims and any other income, less losses paid and expenses properly charged to the fund. Each fund shall be separately maintained and accounted for.
(2) Integrity of fund.
Each fund is held in trust for the benefit of insureds and other proper claimants. It may not be spent for any other purposes of the state and may be borrowed by the state only pursuant to normal and usual investment practices under s. 604.05
History: 1973 c. 117
Each fund under chs. 605
shall be administered by a manager who shall be the commissioner. In chs. 604
, "manager" means the commissioner in his or her capacity as manager.
(2) Other personnel.
The manager of a fund may employ such personnel as are necessary for proper administration. To the extent practicable, the manager shall manage the funds, issue policies and prepare reports in the same way that as commissioner he or she requires other insurers to do, except that periodic annual audits may not be required. The manager may make such reasonable rules for the administration of the funds as are necessary to implement the enabling statutes.
No full-time state officer or employee may receive additional compensation for services under chs. 604
. Appropriate portions of the salaries of such persons who do work for the funds or supervise them, and other expenses including reasonable charges for state-owned or state-rented office space and the use of state-owned or state-rented office equipment shall be charged against each fund. Each fund shall also be charged a sum equivalent to the state premium tax that would be paid by a domestic mutual insurer organized or operating under ch. 611
and doing the same kind of insurance business, except that no such charge shall be made for the insurance of governmental units.
(4) Payment procedure.
Any charges against a fund under sub. (3)
shall be certified by the commissioner, audited by the department of administration under s. 16.53
and paid by the treasurer out of the appropriate fund in accordance with procedures of the department of administration.
(5) Advisory organization membership.
The manager of a fund may have the fund join or subscribe to rate service organizations or other advisory organizations useful for the efficient operation of the fund.
The manager may procure such reinsurance for the fund as he or she considers necessary for its sound operation.
The manager may obtain such inspections and reports on risks insured in the fund as sound insurance practice requires.
Assets of all funds under chs. 605
shall be invested by the state investment board under s. 25.17
. Each January 1 the state treasurer shall credit each fund with earnings on the invested assets in each fund for the preceding 12 months. If any fund is indebted to the general fund of the state the fund shall be charged, at the end of each calendar year, with interest on the indebtedness at the average rate earned by the state upon its deposits in public depositories during the period of indebtedness and that sum shall be credited to the general fund.
Custody of assets and liability. 604.06(1)
The state treasurer has sole custody of all assets of funds under chs. 605
Neither the state nor any person is liable for any obligations of the funds, and the rights of creditors are solely against the assets of the funds, except as otherwise provided in chs. 605
The commissioner as manager of the funds and the treasurer shall file surety bonds, specifically conditioned on the performance of their duties under chs. 605
, in amounts required by, and with sureties approved by, the governor.