611.66
611.66
Exclusive agency contracts. 611.66(1)
(1)
General. Except under
sub. (2), no corporation may enter into any contract whereby any person is granted or obtains directly or indirectly the exclusive right or privilege of soliciting, producing or receiving a fee or commission on all or substantially all of the insurance business of the corporation or on all or substantially all of the insurance business of the corporation in this state.
611.66(2)
(2) Subsidiaries. Subsection (1) does not apply to contracts in which a corporation is the exclusive agent of its insurance subsidiary authorized under
s. 611.26 (1) or in which the subsidiary is the exclusive agent of the corporation.
611.66 History
History: 1971 c. 260.
611.67
611.67
Management contract services. 611.67(1)(c)
(c) "Management authority" means the authority to exercise any management control of the corporation or of its underwriting, loss adjustment, investment, general servicing or production function or other major corporate function.
611.67(2)
(2) Except as provided in
sub. (3), a corporation may not be a party to a contract which has the effect of delegating management authority to a person to the substantial exclusion of the board.
611.67(3)
(3) An insurer that offers a health maintenance organization, limited service health organization or preferred provider plan may delegate management authority with regard to the health maintenance organization, limited service health organization or preferred provider plan to a person other than an officer, director or employee of the insurer if the person exercises the management authority according to the terms of a written contract between the insurer and the person and if the contract is filed with the commissioner and not disapproved by the commissioner under
sub. (4).
611.67(4)(a)(a) The commissioner may disapprove a contract under
sub. (3) within a 30-day period after the date of filing or within a reasonable extension period following the 30-day period if the extension period is specified by notice to the health care plan within the 30-day period.
611.67(4)(b)
(b) The commissioner may disapprove a contract under
sub. (3) only if the commissioner makes one of the findings specified in
s. 618.22 (2).
611.67 History
History: 1985 a. 29.
611.67 Cross-reference
Cross Reference: See also s.
Ins 42.07, Wis. adm. code.
611.69
611.69
Dividends and other distributions. 611.69(2)
(2) Unclaimed dividends and distributions. Chapter 177 applies to stock corporations.
611.69 History
History: 1971 c. 260;
1989 a. 303.
CORPORATE REORGANIZATION
611.71
611.71
Acquisition of all of the shares or of a class of shares of an insurance corporation. 611.71(1)
(1)
Exchange of shares permitted. A domestic stock insurance corporation may acquire, in the manner provided by this section, in exchange for its shares, all the shares, or all the shares of any class, of any other domestic stock insurance corporation, provided no law is violated by the acquisition.
611.71(2)
(2) Offer. The acquiring corporation shall submit by 1st class mail to all holders of the shares to be acquired a written offer which shall:
611.71(2)(a)
(a) Specify the shares to which the offer relates;
611.71(2)(b)
(b) Prescribe the terms and conditions of the proposed exchange, including the method of acceptance and the manner of exchanging the shares;
611.71(2)(c)
(c) Provide such information respecting both corporations as the commissioner prescribes by rule;
611.71(2)(d)
(d) Contain a statement summarizing the rights of the shareholders under
sub. (5) (b); and
611.71(2)(e)
(e) Provide for the payment of cash or scrip in lieu of the issuance of fractional shares of the acquiring corporation.
611.71(3)
(3) Copy of offer. One copy of the offer shall be filed with the commissioner immediately.
611.71(4)
(4) Acceptance. The exchange shall be consummated if, within 120 days after the date of the mailing, the offer is accepted by the holders of not less than 90% of the shares of each class to which it relates. In ascertaining what percentage have accepted, shares may not be counted if at the date of mailing of the offer they were already held by, or by a nominee for, the acquiring corporation or any affiliate.
611.71(5)
(5) Implementation. If there is acceptance satisfying
sub. (4), the acquiring corporation shall, within 60 days:
611.71(5)(a)
(a) Execute and file with the commissioner a certificate setting forth the acceptances; and
611.71(5)(b)
(b) Give written notice of the satisfaction of the requirement, by registered or certified mail return receipt requested, to each holder of shares to which the offer relates who has not yet accepted the offer. The notice, the form of which must be approved by the commissioner, shall include, or be accompanied by, a statement that such shareholders may dissent from the offer by notification to the offeror within 120 days after the date of the mailing and be paid the fair value of their shares as determined under
ss. 180.1325 and
180.1328 to
180.1331, and that failure so to notify the offeror shall be deemed acceptance of the offer. For purposes of
s. 180.1325, notification to the offeror in accordance with this paragraph constitutes a demand for payment under
s. 180.1323.
611.71(6)
(6) Issuance of certificates or information statements. Upon the filing of the certificate under
sub. (5) (a):
611.71(6)(a)
(a) All shares in exchange for which shares of the acquiring corporation are issued shall become the property of the acquiring corporation, whether or not any certificates representing the shares have been surrendered for exchange;
611.71(6)(am)
(am) If the articles of incorporation or bylaws of the acquired corporation require shares to be issued with certificates, the acquiring corporation shall be entitled to have new certificates for the shares under
par. (a) registered in its name as the holder;
611.71(6)(b)
(b) The acquiring corporation shall do all of the following:
611.71(6)(b)1.
1. Cause certificates for its shares to be issued and delivered to the holders of shares who have already accepted, and thereafter immediately upon acceptance to those who accept or are deemed to have accepted.
611.71(6)(b)2.
2. If the shares are issued without certificates, cause information statements that comply with
s. 180.0626 (2) to be issued and delivered to the persons described in
subd. 1.
611.71(6)(c)
(c) The acquiring corporation or a corporate fiduciary designated by it and acceptable to the commissioner, shall hold in trust, for delivery or payment to the persons entitled thereto but not at once located, the certificates or information statements for its shares and cash payable under
sub. (2) (e) or
(5) (b).
611.71(7)
(7) Other exchange offers. This section does not prevent a person from making an offer to purchase the shares of an insurance corporation conditioned upon acceptance by holders of less than 90% of the shares to which the offer relates. Such an offer may be joined as an alternate offer with an offer made under this section; but the acquiring corporation shall have the right to avail itself of this section only if the requirements of
subs. (1) to
(6) are satisfied.
611.71(8)
(8) Acquisition of a small minority of shares. If at least 90% of any class of shares of any domestic stock insurance corporation are held by any other domestic insurance corporation or its nominee, the owning corporation may proceed under
subs. (2) and
(5), even if the offer is accepted by less than the required number of shareholders.
611.72
611.72
Merger or other acquisition of control of a stock insurance corporation. 611.72(1)
(1)
General. Subject to this section,
ss. 180.1101,
180.1103 to
180.1107 [
s. 180.1106],
180.1706,
180.1707 and
180.1708 (5) apply to the merger of a domestic stock insurance corporation or its parent insurance holding corporation, except that papers required by those sections to be filed with the department of financial institutions shall instead be filed with the commissioner.
611.72 Note
NOTE: The bracketed language indicates the correct cross-reference.
2001 Wis. Act 44 repealed s. 180.1107. Corrective legislation is pending.
611.72(2)
(2) Approval required. No proposed plan of merger under
s. 180.1101 or
180.1104 or other plan for acquisition of control may be submitted to the shareholders of any domestic stock insurance corporation or its parent insurance holding corporation participating in the transaction or executed unless it has been approved by the commissioner.
611.72(3)
(3) Grounds for disapproval. The commissioner shall approve the plan if the commissioner finds, after a hearing, unless a hearing is not required under
sub. (3m), that it would not violate the law or be contrary to the interests of the insureds of any participating domestic corporation or of the Wisconsin insureds of any participating nondomestic corporation and that:
611.72(3)(a)
(a) After the change of control, the domestic stock insurance corporation or any domestic stock insurance corporation controlled by the insurance holding corporation would be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed;
611.72(3)(b)
(b) The effect of the merger or other acquisition of control would not be to create a monopoly or substantially to lessen competition in insurance in this state;
611.72(3)(c)
(c) The financial condition of any acquiring party is not likely to jeopardize the financial stability of the domestic stock insurance corporation or its parent insurance holding corporation, or prejudice the interests of its Wisconsin policyholders;
611.72(3)(d)
(d) The plans or proposals which the acquiring party has to liquidate the domestic stock insurance corporation or its parent insurance holding corporation, sell its assets, merge it with any person or make any other material change in its business or corporate structure or management, are fair and reasonable to policyholders of the domestic stock insurance corporation or in the public interest; and
611.72(3)(e)
(e) The competence and integrity of those persons who would control the operation of the domestic stock insurance corporation or its parent insurance holding corporation are such that it would be in the interest of the policyholders of the corporation and of the public to permit the merger or acquisition of control.
611.72(3m)
(3m) Hearing not required. A hearing is not required under
sub. (3) before approval of a proposed plan of merger or other plan for acquisition of control if the proposed merger is with, or the proposed acquirer is, an affiliate of the insurer and the proposed merger or other acquisition of control does not change the controlling person of the insurer.
611.72(4)
(4) Plans of exchange. Any domestic stock insurance corporation may adopt a plan of exchange of all the outstanding shares of its shareholders under which another stock insurance corporation, which acquires the shares, shall as consideration transfer its own shares or other securities issued by it or pay cash or other consideration, or pay or provide any combination of the foregoing types of consideration. The procedure for the adoption and approval of a plan of exchange and the rights of shareholders of the participating corporations shall be the same as for a merger under
subs. (2) and
(3).
611.73
611.73
Merger of mutuals. 611.73(1)(1)
Authorization, domestic corporations. 611.73(1)(a)(a)
In general. Any 2 or more domestic mutuals may merge under the procedures of this section and
ss. 181.1105 and
181.1106, except that papers required by those sections to be filed with the department of financial institutions shall instead be filed with the commissioner.
611.73(1)(b)
(b)
Plan of merger and board resolution. The board of directors of each mutual shall, by resolution adopted by each such board, approve a plan of merger that includes all of the following:
611.73(1)(b)1.
1. The names of the mutuals proposing to merge and the name of the surviving mutual into which they propose to merge.
611.73(1)(b)3.
3. The respective interests and rights of the members of the merging mutuals in the surviving mutual.
611.73(1)(b)4.
4. Any change in the articles of incorporation of the surviving mutual to be effected by the merger.
611.73(1)(b)5.
5. Other provisions with respect to the proposed merger that are considered necessary and desirable.
611.73(1)(c)
(c)
Approval of merger. A plan of merger may be adopted only in the following manner:
611.73(1)(c)1.
1. If the articles of incorporation or bylaws of a merging mutual give members the right to vote on the merger, the board of directors of the mutual shall adopt a resolution approving the proposed plan and directing that it be submitted to a vote at a meeting of members, which may be either an annual or a special meeting. Written notice setting forth the proposed plan or summary of the plan shall be given to each member entitled to vote at the meeting within the time and in the manner provided in this chapter for the giving of notice of meetings of members. The proposed plan shall be adopted by at least two-thirds of the votes entitled to be cast by the members present or represented by proxy at the meeting.
611.73(1)(c)2.
2. If the articles of incorporation or bylaws of any merging mutual do not give the members the right to vote on the merger, a plan of merger shall be adopted at a meeting of the board of directors of each mutual by at least a majority of the directors in office.
611.73(1)(d)
(d)
Abandonment of merger. After approval under
par. (c) and prior to the filing of the articles of merger, the merger may be abandoned pursuant to the provisions for abandonment, if any, set forth in the plan of merger.
611.73(2)
(2) Authorization, domestic and foreign corporations. 611.73(2)(a)(a)
In general. Any 2 or more domestic and foreign mutuals may merge if the merger is permitted by the laws of the state in which the foreign mutuals are organized. Each domestic mutual shall comply with the provisions of this section with respect to the merger of domestic corporations and each foreign mutual shall comply with the applicable provisions of the laws of the state under which it is organized.
611.73(2)(b)
(b)
Effect of merger. The effect of a merger under this subsection is the same as in the case of the merger of domestic mutuals, if the surviving mutual is to be governed by the laws of this state. If the surviving mutual is to be governed by the laws of a state other than this state, the effect of the merger is the same as in the case of the merger of domestic mutuals except as provided by the laws of that other state.
611.73(3)
(3) Approval by the commissioner. The plan of merger shall be submitted to the commissioner for his or her approval after any necessary action by the boards and before any necessary action by the policyholders. The commissioner shall approve the plan unless he or she finds, after a hearing, that the proposed merger would be contrary to the law or to the interests of the insureds of any participating domestic corporation or the Wisconsin insureds of any participating nondomestic corporation.
611.73(4)
(4) Voting by policyholders. The commissioner may order that the plan submitted to him or her under
sub. (3) be amended to provide for voting by policyholders of any mutual involved.
611.74
611.74
Voluntary dissolution of domestic insurance corporations. 611.74(1)(1)
Plan of dissolution. At least 60 days prior to the submission to shareholders or policyholders of any proposed voluntary dissolution of an insurance corporation under
s. 180.1402 or
181.1401 the plan shall be filed with the commissioner. The commissioner may require the submission of additional information to establish the financial condition of the corporation or other facts relevant to the proposed dissolution. If the shareholders or policyholders adopt the resolution to dissolve, the commissioner shall, within 30 days after the adoption of the resolution, begin to examine the corporation. The commissioner shall approve the dissolution unless, after a hearing, the commissioner finds that it is insolvent or may become insolvent in the process of dissolution. Subject to
chs. 600 to
645, upon approval, the corporation may dissolve under
ss. 180.1402 to
180.1408 and
180.1706, or
ss. 181.1401 to
181.1407, except that papers required by those sections to be filed with the department of financial institutions shall instead be filed with the commissioner. Upon disapproval, the commissioner shall petition the court for liquidation or for rehabilitation under
ch. 645.
611.74(2)
(2) Conversion to involuntary liquidation. The corporation may at any time during the liquidation under
ss. 180.1402 to
180.1408 or under
ss. 181.1401 to
181.1407 apply to the commissioner to have the liquidation continued under the commissioner's supervision; thereupon the commissioner shall apply to the court for liquidation under
s. 645.41 (10).
611.74(3)
(3) Revocation of voluntary dissolution. If the corporation revokes the voluntary dissolution proceedings under
ss. 180.1404 and
180.1706 or under
s. 181.1404, a copy of the articles of revocation of dissolution prepared under
s. 180.1404 or
181.1404 shall be filed with the commissioner.
611.74(4)
(4) Distribution of assets of a mutual. No distribution may be made to policyholders in excess of the amounts to which they are entitled under
s. 645.72 (4). Any excess over such amounts shall be paid into the state treasury to the credit of the common school fund.
611.75
611.75
Conversion of a domestic stock corporation into a mutual. A domestic stock corporation may be converted into a domestic mutual as follows:
611.75(1)
(1) Action by board. The board shall adopt a plan of conversion. Thereafter no additional shares of capital stock shall be issued except that stock options to purchase capital stock may continue to be issued under existing contracts and outstanding options may continue to be exercised until the conversion is executed under
sub. (6).
611.75(2)(a)(a) The plan of conversion shall provide for the purchase by the corporation of all of its outstanding capital stock, at a price either specified in the plan or to be determined under a formula specified in the plan, for cash, specified debt securities to be issued by the corporation, or both. All holders of capital stock of the same class shall have the same rights under the plan. Shareholders may be given an election to take all or a portion of the price in the specified debt securities. Debt securities may be of any class authorized for mutual corporations under
s. 611.33 (2).
