2021 WISCONSIN ACT 114
An Act to repeal 601.954 (2) (f) 1., 635.05 (7), 635.12 and 646.51 (3) (ar) 1.; to renumber 632.66; to consolidate, renumber and amend 601.954 (2) (f) (intro.) and 2. and 646.51 (3) (ar) (intro.) and 2.; to amend 601.64 (3) (c), 611.40 (1), 611.42 (1), 611.42 (1e) (b) (intro.), 632.62 (1) (b) 1., 632.62 (1) (b) 2., 645.68 (3), 646.13 (2) (g), 646.325 (2) (intro.), 646.325 (2) (a) (intro.), 655.27 (3) (b) 2., 655.27 (3) (bt) and 655.275 (2); and to create 551.102 (28) (bm), 601.465 (3) (g), 601.465 (3) (h), 601.48 (1m), 611.42 (1b), 611.42 (1g), 611.426, 617.13, 625.03 (1m) (f), 632.62 (1) (b) 4., 632.66 (2), 646.01 (1) (b) 21., 646.01 (1) (b) 22. and 646.325 (2) (a) 3. of the statutes;
relating to: various changes to insurance laws, including issuance of funding agreements, granting rule-making authority, and providing a penalty.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
551.102 (28) (bm) of the statutes is created to read:
551.102 (28) (bm) Does not include a funding agreement authorized under s. 632.66.
601.465 (3) (g) of the statutes is created to read:
601.465 (3) (g) Any information designated as confidential under s. 632.66 (2) (g), which is subject to the confidentiality provisions in s. 632.66 (2) (g).
601.465 (3) (h) of the statutes is created to read:
601.465 (3) (h) Group capital calculation and liquidity stress test filings and any related information provided by an insurer under rules promulgated under s. 617.13 (1), which are not subject to subch. II of ch. 19 and are subject only to the confidentiality provisions of s. 617.13 (2).
601.48 (1m) of the statutes is created to read:
601.48 (1m) Accreditation. (a) The office shall maintain accreditation with the National Association of Insurance Commissioners.
(b) Notwithstanding s. 230.14, the commissioner may adopt minimum education and certification requirements for job classification levels that monitor the financial solvency of insurers as necessary to meet accreditation and best practice standards established by the National Association of Insurance Commissioners. Any minimum education and certification requirement adopted under this paragraph shall apply only to employees placed into the classification level after the requirement is adopted and may not apply to employees who were in that classification level prior to the adoption of the requirement.
601.64 (3) (c) of the statutes is amended to read:
601.64 (3) (c) Forfeiture for violation of statute or rule. Whoever violates an insurance statute or rule or s. 149.13, 2011 stats., intentionally aids a person in violating an insurance statute or rule or s. 149.13, 2011 stats., or knowingly permits a person over whom he or she has authority to violate an insurance statute or rule or s. 149.13, 2011 stats., shall forfeit to the state not more than $1,000 for each violation, except that whoever violates an insurance statute or rule, intentionally aids a person in violating an insurance statute or rule, or knowingly permits a person over whom he or she has authority to violate an insurance statute or rule shall, if the violation specifically involves a consumer who is an adult at risk, as defined in s. 55.01 (1e), or an individual who is at least 60 years of age, forfeit to the state not more than $5,000 for each violation. If the statute or rule imposes a duty to make a report to the commissioner, each week of delay in complying with the duty is a new violation.
601.954 (2) (f) (intro.) and 2. of the statutes, as created by 2021 Wisconsin Act 73, are consolidated, renumbered 601.954 (2) (f) and amended to read:
601.954 (2) (f) Exceptions for certain entities. This subsection does not apply to any of the following: 2. An entity that is described in 45 CFR 164.104 (a), if the entity complies with the requirements of 45 CFR part 164.
601.954 (2) (f) 1. of the statutes is repealed.
611.40 (1) of the statutes is amended to read:
611.40 (1) Meetings, notices, quorums and voting. Sections 180.0701 to 180.0703, 180.0705, 180.0709, 180.0721 to 180.0727 and 180.1708 (3) apply to stock corporations. Each director of a stock corporation shall be elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present.
611.42 (1) of the statutes is amended to read:
611.42 (1) General. Subject to this section and s. 611.53, ss. 181.0701 (1), (2), and (4) to (6), 181.0702, 181.0705 (1) to (4) (1) to (3) and (5), 181.0722 (1) to (3), 181.0723, and 181.0727 apply to mutuals.
611.42 (1b) of the statutes is created to read:
611.42 (1b) Place of meetings. (a) A mutual may hold an annual, regular, or special meeting of policyholders in or outside this state at the place stated in or fixed in accordance with the bylaws. If no place is stated in or fixed in accordance with the bylaws, the mutual shall hold the annual meeting at its principal office.
(b) Notwithstanding par. (a), a mutual's bylaws may authorize the board of directors, in its sole discretion, to determine that an annual, regular, or special meeting of policyholders may be held solely by means of remote communication as authorized under s. 611.426.
611.42 (1e) (b) (intro.) of the statutes is amended to read:
611.42 (1e) (b) (intro.) The court may fix the time and place of the meeting or determine that the meeting shall be held solely by means of remote communication as provided under s. 611.426. The court shall require that the meeting be called and conducted in accordance with the mutual's articles of incorporation and bylaws, in so far as possible, except that the court may do all of the following:
611.42 (1g) of the statutes is created to read:
611.42 (1g) Notice of meetings. (a) When required. A mutual shall give notice of meetings of policyholders as provided in its bylaws or, if the bylaws are silent, in a manner that is fair and reasonable.
(b) In general. A notice that conforms to the requirements of par. (c) is fair and reasonable. Except for matters referred to in par. (c) 2., other means of giving notice may also be fair and reasonable when all of the circumstances are considered. Section 181.0141 applies to notices provided under this subsection.
(c) Notice safe harbor. Notice is fair and reasonable if all of the following conditions exist:
1. The mutual notifies its policyholders of the date, time, and, if applicable, place of each annual, regular, and special meeting of policyholders not more than 60 days and not less than 10 days, or, if notice is mailed by any type other than first class or registered mail, 30 days, before the meeting date. If the board of directors has authorized participation by means of remote communication under s. 611.426, the notice shall describe the means of remote communication to be used.
2. Notice of an annual or regular meeting includes a description of any matter or matters that must be approved by the policyholders under s. 181.0723 (2), 181.0831, 181.0873 (4), 181.1003, 181.1021, 181.1105, 181.1202, or 181.1401.
3. Notice of a special meeting includes a description of the matter or matters for which the meeting is called.
(d) Adjourned meetings. Unless the bylaws require otherwise, if an annual, regular, or special meeting of policyholders is adjourned to a different date, time, or place or will be held by a new means of remote communication, notice need not be given of the new date, time, place, or means of remote communication if the new date, time, place, or means of remote communication is announced at the meeting before adjournment. If a new record date for the adjourned meeting is or must be fixed under s. 181.0707, notice of the adjourned meeting must be given under this subsection to the policyholders of record as of the new record date.
611.426 of the statutes is created to read:
611.426 Remote participation in policyholder meetings. (1) If authorized by the board of directors in its sole discretion, and subject to sub. (2) and any guidelines and procedures adopted by the board of directors, policyholders and proxies of policyholders not physically present at a meeting of policyholders may participate in the meeting by means of remote communication.
(2) If policyholders and proxies of policyholders participate in a meeting of policyholders by means of remote communication, the participating policyholders and proxies of policyholders shall be considered to be present in person and permitted to vote at the meeting, whether the meeting is held at a designated place or solely by means of remote communication, if all of the following apply:
(a) The mutual has implemented reasonable measures to verify that each person considered to be present and permitted to vote at the meeting by means of remote communication is a policyholder or proxy of a policyholder.
(b) The mutual has implemented reasonable measures to provide policyholders and proxies of policyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the policyholders, including an opportunity to read or hear the proceedings of the meeting concurrently with the proceedings.
(c) The mutual maintains a record of voting and other actions by any policyholder or proxy of a policyholder that votes or takes another action at the meeting by means of remote communication.
617.13 of the statutes is created to read:
617.13 Rules requiring group capital calculations and liquidity stress tests. (1) The commissioner shall promulgate rules requiring certain insurers, as determined under the rules, to report their group capital calculations and liquidity stress tests, including the form of the reports and the manner and process for filing the reports.
(2) Sections 19.31 to 19.37 do not apply to the filings made under sub. (1) or to any information submitted to the commissioner in connection with the filings. The filings made under sub. (1) are not subject to subpoena or discovery and may not be admissible in evidence in any private civil action. The commissioner shall only share a filing made under sub. (1), and any information requested in connection with the filing, with the insurance regulatory authorities of states having statutes or regulations substantially similar to this section and who have agreed in writing not to disclose the information.
625.03 (1m) (f) of the statutes is created to read:
625.03 (1m) (f) Funding agreements authorized under s. 632.66.
632.62 (1) (b) 1. of the statutes is amended to read:
632.62 (1) (b) 1. Paid-up, temporary, pure endowment insurance and annuity settlements provided in exchange for lapsed, surrendered or matured policies;
632.62 (1) (b) 2. of the statutes is amended to read:
632.62 (1) (b) 2. Annuities beginning within one year of the making of the contract; and.
632.62 (1) (b) 4. of the statutes is created to read:
632.62 (1) (b) 4. Funding agreements authorized under s. 632.66.
632.66 of the statutes is renumbered 632.66 (1).
632.66 (2) of the statutes is created to read:
632.66 (2) (a) In this subsection, “funding agreement” means an annuity without life contingencies that is an agreement for an insurer to accept and accumulate funds and to make one or more payments at future dates in fixed or variable amounts, or both, that are not based on mortality or morbidity contingencies.
(b) A domestic insurer that holds a valid certificate of authority to transact the business of life insurance and annuities in this state may issue a funding agreement if all of the following conditions are met:
1. The domestic insurer's board of directors, or an authorized committee of the board, approves the domestic insurer's plan relating to funding agreements.
2. The commissioner determines that the issuance of funding agreements by the domestic insurer is not adverse to the interests of the policyholders of the domestic insurer, except that no determination from the commissioner is required if the domestic insurer has more than $200 billion in admitted assets. In making a determination under this subdivision, the commissioner shall consider the domestic insurer's specific policy objective and strategies, investment and risk management guidelines, and aggregate maximum limits on the funding agreement business.