Notify the policyholder of the initial rate of interest on the loan at the time a policy loan is made, if the loan is not a premium loan.
Notify the policyholder with respect to premium loans of the initial rate of interest on the loan as soon as it is reasonably practical to do so after making the initial loan. Notice need not be given to the policyholder when a further premium loan is added, except as provided in par. (c)
Send to policyholders with loans 30 days' advance notice of any increase in the interest rate.
(7) Coverage continuation.
No policy may terminate in a policy year as the sole result of a change in the loan interest rate during that policy year. The insurer shall maintain coverage until it would have terminated if there had been no change.
(8) Policy provisions.
The pertinent provisions of subs. (2)
shall be set forth in substance in the policies to which they apply.
History: 1981 c. 51
; 1983 a. 215
Designation of beneficiary. 632.48(1)
Powers of policyholders.
Subject to s. 632.47 (2)
, no life insurance policy or annuity contract may restrict the right of a policyholder or certificate holder:
Irrevocable designation of beneficiary.
To make at any time an irrevocable designation of beneficiary effective at once or at some subsequent time; or
Change of beneficiary.
If the designation of beneficiary is not explicitly irrevocable, to change the beneficiary without the consent of the previously designated beneficiary. Subject to s. 853.17
, as between the beneficiaries, any act that unequivocally indicates an intention to make the change is sufficient to effect it.
(2) Protection of insurer.
An insurer may prescribe formalities to be complied with for the change of beneficiaries, but formalities prescribed under this subsection shall be designed only for the protection of the insurer. The insurer discharges its obligation under the insurance policy or certificate of insurance if it pays a properly designated beneficiary unless it has actual notice of either an assignment or a change in beneficiary designation made under sub. (1) (b)
. It has actual notice if the prescribed formalities are complied with or if the change in beneficiary has been requested in the form prescribed by the insurer and delivered to an intermediary representing the insurer.
History: 1975 c. 373
; 1979 c. 93
Legislative Council Note, 1979: The amendment to sub. (2) adds a situation in which the insured has acted reasonably in dealing with a representative of the insurer. As between the insurer and the insured, the burden should fall upon the insurer if the agent makes an error of this kind. The insurer, of course, may have a cause of action against its agent. [Bill 20-S]
Under the facts of the case, the decedent's oral instruction to his attorney to change a beneficiary was a sufficient "act" under sub. (1) (b) even though the new beneficiary was not designated with sufficient specificity. Empire General Life Insurance v. Silverman, 135 Wis. 2d 143
, 399 N.W.2d 910
Estoppel from medical examination.
If under the rules of any insurer issuing life insurance, its medical examiner has authority to issue a certificate of health, or to declare the proposed insured acceptable for insurance, and so reports to the insurer or its agent, the insurer is estopped to set up in defense of an action on the policy issued thereon that the proposed insured was not in the condition of health required by the policy at the time of issue or delivery, or that there was a preexisting condition not noted in the certificate or report, unless the certificate or report was procured through the fraudulent misrepresentation or nondisclosure by the applicant or proposed insured.
History: 1975 c. 375
Estoppel under this section may apply against insurers who seek a medical examiner's opinion regarding fitness for insurance without establishing any formal rules regarding the examiner's authority. Grosse v. Protective Life Insurance Co. 182 Wis. 2d 97
, 513 N.W.2d 592
Required group life insurance provisions.
Every group life insurance policy shall contain the following:
(1) Evidence of insurability.
A provision setting forth any conditions under which the insurer reserves the right to require a person eligible for insurance to furnish evidence of individual insurability satisfactory to the insurer as a condition to part or all of that coverage.
(2) Misstatement of age.
A provision specifying that an equitable adjustment of premiums or of benefits or of both will be made if the age of an insured person has been misstated and clearly stating the method of adjustment.
(3) Facility of payment.
A provision that any sum becoming due by reason of the death of an insured person is payable to the beneficiary designated by the insured person, subject to policy provisions if there is no designated beneficiary, and to any right reserved by the insurer in the policy and set forth in the certificate to pay at its option a part of the sum not exceeding $1,000 to any person appearing to the insurer to be equitably entitled thereto by reason of having incurred funeral or other expenses incident to the last illness or death of the insured person. This subsection does not apply to a policy issued to a creditor to insure his or her debtors.
If it is not term insurance, equitable nonforfeiture provisions, but they need not be the same provisions as are in individual policies.
(5) Grace period.
A provision that the policyholder is entitled to a grace period of not less than 31 days for the payment of any premium due except the first. During the grace period the death benefit coverage shall continue in force, unless the policyholder gives the insurer advance written notice of discontinuance in accordance with the terms of the policy. The policy may provide that the policyholder shall be liable to the insurer for the payment of a proportional premium for the time the policy was in force during the grace period.
History: 1975 c. 375
; 1979 c. 110
s. 60 (11)
Conversion option in group and franchise life insurance. 632.57(1)(1)
Scope of application.
This section applies to all group life insurance policies other than credit life insurance policies and applies to franchise life insurance policies providing term insurance renewable only while the insured is a member of the franchise unit.
(2) Conversion right upon loss of eligibility. 632.57(2)(a)(a)
If the insurance, or any portion of it, on a person insured under a policy covered by this section ceases because of termination of employment or of membership in the class or franchise unit eligible for coverage, the insurer shall, upon written application and payment of the first premium within 31 days after the termination, issue to the person, without evidence of insurability, an individual policy providing benefits reasonably similar in type and amount to those of the group or franchise insurance, but which need not include disability or other supplementary benefits.
Form of policy.
The individual policy shall, at the option of the applicant, be on any form then customarily issued by the insurer, except term insurance, at the age and for the amount applied for.
Amount of coverage.
The individual policy shall, at the option of the applicant, be in an amount as large as in the group or franchise life insurance which ceases, less any amount of insurance which has then matured as an endowment payable to the insured person, whether in one sum or in instalments or in the form of an annuity.
The premium on the individual policy shall be at the customary rate then applied generally by the insurer to policies in the form and amount of the individual policy, to the class of risk to which the person then belongs without applying individual underwriting considerations, except as to occupation or avocation, and to the person's age on the effective date of the individual policy.
(4) Conversion upon termination of group or franchise insurance.
If the group or franchise policy terminates or is amended so as to terminate the insurance of any class of insured persons, the insurer shall, on written application and payment of the first premium within 31 days after the termination, issue to any person whose insurance is thus terminated or amended, after having been in effect for at least 5 years, an individual policy on the same conditions as in subs. (2)
, less the amount of any other group or franchise insurance made available to the person within 31 days thereafter as a consequence of the termination or amendment. The group policy may provide that the maximum amount of insurance available under this subsection is an amount not less than $2,000 without a conversion charge and an additional amount not less than $3,000 by paying the insurer's usual conversion charge on the additional amount.
(5) Extension of claims under group or franchise policy.
If a person insured under the group or franchise policy dies during the conversion period under sub. (2)
and before an individual policy is effective, the amount of life insurance which the person would have been entitled to have issued as an individual policy shall be payable as a claim under the group or franchise policy, whether or not the person has applied for the individual policy or paid the first premium.
History: 1975 c. 375
Limitation on credit life insurance.
Nothing in chs. 600
authorizes licensees under s. 138.09
to require or accept insurance not permitted under s. 138.09 (7) (h)
History: 1975 c. 375
; 1979 c. 89
Participating and nonparticipating policies. 632.62(1)(a)(a)
A stock insurer may issue both participating and nonparticipating life insurance policies and annuity contracts, subject to this section.
Fraternals and mutual insurers.
A fraternal or mutual insurer issuing life insurance policies may issue only participating policies, except for the following situations in which it may issue nonparticipating policies:
Paid-up, temporary, pure endowment insurance and annuity settlements provided in exchange for lapsed, surrendered or matured policies;
Annuities beginning within one year of the making of the contract; and
Such term insurance policies as the commissioner may exempt by rule.
Every participating policy shall by its terms give its holder full right to participate annually in the part of the surplus accumulations from the participating business of the insurer that are to be distributed.
Every insurer issuing both participating and nonparticipating policies shall separately account for the 2 classes of business and no part of the amounts accumulated or credited to the participating class may be voluntarily transferred to the nonparticipating class.
No life insurance policy or certificate may be issued in which the accounting, apportionment and distribution of surplus is deferred for a period longer than one year.
Every insurer doing a participating business shall annually ascertain the surplus over required reserves and other liabilities. After setting aside such contingency reserves as may be considered necessary and be lawful, such reasonable nondistributable surplus as is needed to permit orderly growth, making provision for the payment of reasonable dividends upon capital stock and such sums as are required by prior contracts to be held on account of deferred dividend policies, the remaining surplus shall be equitably apportioned and returned as a dividend to the participating policyholders or certificate holders entitled to share therein. A dividend may be conditioned on the payment of the succeeding year's premium only on the first and second anniversaries of the policy.
History: 1975 c. 373
; 1979 c. 102
Certification of disability.
Insurers doing a life insurance business in this state shall afford equal weight to a certification of disability signed by a physician with respect to matters within the scope of the physician's professional license and to a certification of disability signed by a chiropractor with respect to matters within the scope of the chiropractor's professional license for the purpose of insurance policies they issue. This section does not require an insurer to treat a certificate of disability as conclusive evidence of disability.
History: 1981 c. 55
Annuity contracts without life contingencies.
The commissioner may by rule authorize insurers to issue annuity contracts which are without life contingencies. If the commissioner authorizes insurers to issue annuity contracts without life contingencies, the commissioner shall promulgate rules regulating those contracts.
History: 1987 a. 247
Effect of power of attorney for health care.
Executing a power of attorney for health care under ch. 155
may not be used to impair in any manner the procurement of a life insurance policy or to modify the terms of an existing life insurance policy. A life insurance policy may not be impaired or invalidated in any manner by the exercise of a health care decision by a health care agent on behalf of a person whose life is insured under the policy and who has authorized the health care agent under ch. 155
History: 1989 a. 200
Regulation of viatical settlement contracts. 632.68(1)(b)
"Viatical settlement" means payment to the policyholder of a life insurance policy, or to the certificate holder of a group life insurance certificate, insuring the life of a person who has a catastrophic or life-threatening illness or condition, in an amount that is less than the expected death benefit under the policy or certificate, for assigning, selling, devising or otherwise transferring the ownership of or the death benefit under the policy or certificate to the person paying the viatical settlement.
"Viatical settlement broker" means a person that, for a fee, commission or other valuable consideration, offers or attempts to negotiate settlements between a life insurance policyholder or certificate holder and one or more viatical settlement providers. The term does not include a viatical settlement agent, as defined by the commissioner by rule under sub. (11) (b) 4.
, or an attorney, accountant or financial planner retained by a policyholder or certificate holder to represent the policyholder or certificate holder.
"Viatical settlement contract" means a written agreement providing for and establishing the terms of a viatical settlement.
"Viatical settlement provider" means a person that pays a viatical settlement. The term does not include any of the following:
A financial institution, as defined in s. 705.01 (3)
, that takes an assignment of a life insurance policy or certificate as collateral for a loan.
The issuer of a life insurance policy or certificate providing accelerated benefits under the policy or certificate.
A natural person who enters into no more than one agreement in a year for the transfer of the ownership of or the death benefit under a life insurance policy or a group life insurance certificate for an amount that is less than the expected death benefit under the policy or certificate.
A natural person who enters into an agreement for the transfer of the ownership of or the death benefit under a life insurance policy or a group life insurance certificate for an amount that is less than the expected death benefit under the policy or certificate and who is a member of the immediate family, as defined in s. 23.33 (1) (h)
, of the life insurance policyholder or certificate holder.
(2) Viatical settlement provider license requirement. 632.68(2)(a)(a)
Except as provided in sub. (1) (e) 3.
, no person may act as a viatical settlement provider, solicit or pay viatical settlements or enter into a viatical settlement contract with the policyholder of the life insurance policy, or the certificate holder of the group life insurance certificate, that is the subject of a viatical settlement contract unless the person obtains and has in effect a viatical settlement provider license under this subsection.
A person may apply to the commissioner for a viatical settlement provider license on a form prescribed by the commissioner for that purpose. The application form shall require the applicant to provide the applicant's social security number, if the applicant is a natural person unless the applicant does not have a social security number, or the applicant's federal employer identification number, if the applicant is not a natural person. The fee specified in s. 601.31 (1) (mm)
shall accompany the application. After any investigation of the applicant that the commissioner determines is sufficient, the commissioner shall issue a viatical settlement provider license to an applicant that satisfies all of the following:
Provides complete information on the application, including the applicant's social security number, unless the applicant does not have a social security number, or federal employer identification number.
If a natural person who does not have a social security number, provides on a form prescribed by the department of workforce development a statement made or subscribed under oath or affirmation that the applicant does not have a social security number.
Fully discloses the identity of all stockholders, partners, officers and employees, if applicable.
If a corporation, is incorporated under the laws of this state or is authorized to transact business in this state.
Shows to the satisfaction of the commissioner all of the following:
If a natural person, that the applicant is competent and trustworthy, or, if a partnership, corporation or limited liability company, that all partners, members, directors or principal officers or persons in fact having comparable powers are competent and trustworthy.
If a natural person, that the applicant has the intent in good faith to do business as a viatical settlement provider, or, if a partnership, corporation or limited liability company, that the applicant has that intent and has included that purpose in the articles of association, incorporation or organization.
That the applicant has a good business reputation and, if a natural person, has had experience, training or education that qualifies the applicant to be a viatical settlement provider, or, if a partnership, corporation or limited liability company, that all partners, members, directors or principal officers or persons in fact having comparable powers have had experience, training or education that qualifies the applicant to be a viatical settlement provider.
If a nonresident, files with the commissioner a written designation of the applicant's agent in this state for service of process or executes in a form acceptable to the commissioner an agreement to be subject to the jurisdiction of the commissioner and the courts of this state on any matter related to the applicant's viatical settlement activities in this state, on the basis of service of process under ss. 601.72
The commissioner shall disclose a social security number obtained under par. (b)
to the department of workforce development in the administration of s. 49.22
, as provided in a memorandum of understanding entered into under s. 49.857
The commissioner may disclose a social security number or federal employer identification number received under par. (b)
to the department of revenue for the purpose of requesting certifications under s. 73.0301
Notwithstanding par. (b)
, the commissioner may not issue a license under this subsection to a natural person who is delinquent in court-ordered payments of child or family support, maintenance, birth expenses, medical expenses or other expenses related to the support of a child or former spouse, or who fails to comply, after appropriate notice, with a subpoena or warrant issued by the department of workforce development or a county child support agency under s. 59.53 (5)
and related to paternity or child support proceedings, as provided in a memorandum of understanding entered into under s. 49.857
Notwithstanding par. (b)
, the commissioner may not issue a license under this subsection if the department of revenue certifies under s. 73.0301
that the applicant is liable for delinquent taxes.
Except as provided in par. (cm)
, if the commissioner denies an application for a license under this subsection, the applicant may, within 20 days after receiving notice of the denial, demand a hearing. The demand shall be in writing and shall be served on the commissioner by delivering a copy to the commissioner or by leaving it at the commissioner's office. The commissioner shall hold a hearing not less than 10 days nor more than 30 days after service of the demand. Failure to demand a hearing within the required time constitutes waiver of a hearing.