LRB-3339/1
EKL:cjs
2019 - 2020 LEGISLATURE
June 21, 2019 - Introduced by Senators Craig, Bewley, LeMahieu, Schachtner
and Stroebel, cosponsored by Representatives Felzkowski, Doyle, Kulp,
Petryk, Ramthun, Thiesfeldt and Skowronski. Referred to Committee on
Insurance, Financial Services, Government Oversight and Courts.
SB289,1,4 1An Act to renumber and amend 631.36 (5) (a) and 631.36 (5) (c); to amend
2631.36 (5) (d); and to create 631.36 (5) (a) 2. and 631.36 (5) (c) 2. of the statutes;
3relating to: notice of change in terms or premium amount for insurance policy
4renewal.
Analysis by the Legislative Reference Bureau
Under current law, an insurer who offers to renew an insurance policy on less
favorable terms or with a premium increase of at least 25 percent generally must
notify the policyholder about the new terms or the increased premium at least 60
days prior to the renewal date. If the insurer is unable to determine the actual
amount of the premium increase at that time, the insurer may provide the
policyholder with a good faith estimate of the amount. If the insurer fails to provide
notice before the 60-day deadline, the new terms or premiums do not take effect until
60 days after the notice is mailed or delivered to the policyholder, and the
policyholder may cancel the policy at any time during those 60 days. This bill reduces
the 60-day time frames to 45 days for personal lines property and casualty policies.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB289,1 5Section 1. 631.36 (5) (a) of the statutes is renumbered 631.36 (5) (a) 1. and
6amended to read:
SB289,2,16
1631.36 (5) (a) 1. Subject to pars. (b) and (d), for any policy other than a policy
2described in subd. 2.,
if the insurer offers or purports to renew the policy but on less
3favorable terms or at higher premiums, the new terms or premiums take effect on
4the renewal date if the insurer sent by 1st class mail or delivered to the policyholder
5notice of the new terms or premiums at least 60 days prior to the renewal date. If
6the insurer notifies the policyholder within 60 days prior to the renewal date, the new
7terms or premiums do not take effect until 60 days after the notice is mailed or
8delivered, in which case the policyholder may elect to cancel the renewal policy at any
9time during the 60-day period. The notice shall include a statement of the
10policyholder's right to cancel. If the policyholder elects to cancel the renewal policy
11during the 60-day period, return premiums or additional premium charges shall be
12calculated proportionately on the basis of the old premiums. If the insurer does not
13notify the policyholder of the new premiums or terms as required by this subsection
14prior to the renewal date, the insurer shall continue the policy for an additional
15period of time equivalent to the expiring term and at the same premiums and terms
16of the expiring policy, except as permitted under sub. (2) or (3).
SB289,2 17Section 2. 631.36 (5) (a) 2. of the statutes is created to read:
SB289,3,818 631.36 (5) (a) 2. Subject to pars. (b) and (d), for personal lines property and
19casualty policies, if the insurer offers or purports to renew the policy but on less
20favorable terms or at higher premiums, the new terms or premiums take effect on
21the renewal date if the insurer sent by 1st class mail or delivered to the policyholder
22notice of the new terms or premiums at least 45 days prior to the renewal date. If
23the insurer notifies the policyholder within 45 days prior to the renewal date, the new
24terms or premiums do not take effect until 45 days after the notice is mailed or
25delivered, in which case the policyholder may elect to cancel the renewal policy at any

1time during the 45-day period. The notice shall include a statement of the
2policyholder's right to cancel. If the policyholder elects to cancel the renewal policy
3during the 45-day period, return premiums or additional premium charges shall be
4calculated proportionately on the basis of the old premiums. If the insurer does not
5notify the policyholder of the new premiums or terms as required by this subsection
6prior to the renewal date, the insurer shall continue the policy for an additional
7period of time equivalent to the expiring term and at the same premiums and terms
8of the expiring policy, except as permitted under sub. (2) or (3).
SB289,3 9Section 3. 631.36 (5) (c) of the statutes is renumbered 631.36 (5) (c) 1. and
10amended to read:
SB289,4,211 631.36 (5) (c) 1. Subject to par. (d), for any policy other than a policy described
12in subd. 2.,
an insurer may alter the terms or premium of a policy issued for a term
13longer than one year or for an indefinite term on the anniversary date only if notice
14of less favorable terms or premiums is sent by 1st class mail or delivered to the
15policyholder at least 60 days prior to the anniversary date. If the insurer notifies the
16policyholder within 60 days prior to the anniversary date, the new terms or
17premiums do not take effect until 60 days after the notice is mailed or delivered, in
18which case the policyholder may elect to cancel the policy at any time during the
1960-day period. The notice shall include a statement of the policyholder's right to
20cancel. If the policyholder elects to cancel the policy during the 60-day period, return
21premiums or additional premium charges shall be calculated proportionately on the
22basis of the old premiums. If the insurer does not notify the policyholder of the new
23premiums or terms as required by this subsection prior to the anniversary date, the
24insurer shall continue the policy until the next anniversary date or the renewal date,

1whichever is earlier, at the same premiums and terms as for the previous period,
2except as permitted under sub. (2) or (3).
SB289,4 3Section 4. 631.36 (5) (c) 2. of the statutes is created to read:
SB289,4,194 631.36 (5) (c) 2. Subject to par. (d), for personal lines property and casualty
5policies, an insurer may alter the terms or premium of a policy issued for a term
6longer than one year or for an indefinite term on the anniversary date only if notice
7of less favorable terms or premiums is sent by 1st class mail or delivered to the
8policyholder at least 45 days prior to the anniversary date. If the insurer notifies the
9policyholder within 45 days prior to the anniversary date, the new terms or
10premiums do not take effect until 45 days after the notice is mailed or delivered, in
11which case the policyholder may elect to cancel the policy at any time during the
1245-day period. The notice shall include a statement of the policyholder's right to
13cancel. If the policyholder elects to cancel the policy during the 45-day period, return
14premiums or additional premium charges shall be calculated proportionately on the
15basis of the old premiums. If the insurer does not notify the policyholder of the new
16premiums or terms as required by this subsection prior to the anniversary date, the
17insurer shall continue the policy until the next anniversary date or the renewal date,
18whichever is earlier, at the same premiums and terms as for the previous period,
19except as permitted under sub. (2) or (3).
SB289,5 20Section 5. 631.36 (5) (d) of the statutes is amended to read:
SB289,5,421 631.36 (5) (d) Estimate. An insurer may give notice under par. (a) or (c) of a new
22premium by stating the actual amount or percentage increase to be charged. If the
23insurer cannot reasonably determine the actual amount or percentage increase 45
24days prior to the renewal or anniversary date for a policy subject to par. (a) 2. or (c)
252., or
60 days prior to the renewal or anniversary date for any other policy, the notice

1shall include a good faith estimate of the increase based on information that the
2insurer can reasonably obtain. If an estimate is stated, the insurer shall renew or
3continue the policy at a premium that does not exceed the increase stated in the
4notice except as permitted under sub. (5) par. (b).
SB289,6 5Section 6. Initial applicability.
SB289,5,86 (1) For policies containing provisions inconsistent with this act, this act first
7applies to policies newly issued, extended, modified, or renewed on the effective date
8of this subsection.
SB289,7 9Section 7. Effective date.
SB289,5,1110 (1) This act takes effect on the first day of the 4th month beginning after
11publication.
SB289,5,1212 (End)
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