a. The policyholder is a resident of this state.
b. The policyholder is not a resident of this state, but the insurer that issued the structured settlement annuity is domiciled in this state, and the state in which the policyholder resides has an organization that is comparable to the fund.
261,92 Section 92. 646.31 (3) of the statutes is repealed.
261,93 Section 93. 646.31 (5) of the statutes is repealed.
261,94 Section 94. 646.31 (6) (a) of the statutes is amended to read:
646.31 (6) (a) The portion of a an otherwise eligible loss claim for which indemnification is provided by other benefits or advantages, which may not be included in the classes of claims specified in s. 645.68 (intro.), may not be claimed from the fund under this chapter or from the insured or policyholder. The claimant must exhaust such collateral sources before pursuing payment from the fund. This paragraph does not apply to the claim of an insured or payee under a structured settlement annuity.
261,95 Section 95. 646.31 (6) (b) of the statutes is amended to read:
646.31 (6) (b) The board fund may waive the application of par. (a) to claims under contracts subject to s. 646.35 (2) or (3), to the extent that the board fund determines that application of par. (a) would be impracticable.
261,96 Section 96. 646.31 (7) of the statutes is amended to read:
646.31 (7) Setoffs and counterclaims. Section 645.56 applies to the settlement of loss claims. The board fund shall give the liquidator a reasonable opportunity to inform the board fund of possible setoffs and counterclaims before paying loss claims.
261,97 Section 97. 646.31 (8) of the statutes is amended to read:
646.31 (8) Notice to claimants. The board fund shall provide notice under s. 645.47 (2) to those potential loss claimants to whom the fund is liable under the section, if the liquidator has not done so.
261,98 Section 98. 646.31 (9) (a) of the statutes is amended to read:
646.31 (9) (a) By any security fund with an obligation to pay all loss claims of the insurer;.
261,99 Section 99. 646.31 (9) (b) of the statutes is amended to read:
646.31 (9) (b) If it is a first party claim for damage to property with a permanent location, by the fund of the location of the property;.
261,100 Section 100. 646.31 (9) (c) of the statutes is amended to read:
646.31 (9) (c) If it is a workers' compensation claim, by the fund of the residence of the claimant;.
261,101 Section 101. 646.31 (9) (cm) of the statutes is created to read:
646.31 (9) (cm) If it is a liability claim, by the fund of the residence of the policyholder.
261,102 Section 102. 646.31 (9) (d) of the statutes is amended to read:
646.31 (9) (d) In any other case, by the fund of the residence of the insured; and.
261,103 Section 103. 646.31 (10) of the statutes is renumbered 646.31 (10) (intro.) and amended to read:
646.31 (10) Temporary moratoriums. (intro.) Before being obligated to make payments under this chapter to holders of life insurance or annuity contracts the fund may impose, with court approval, temporary any of the following:
(a) Temporary moratoriums of not more than 90 days on payments of cash values and policy loans in addition to any deferrals of cash or policy loan value by contractual provision. A temporary moratorium may be renewed for successive periods of not more than 90 days with court approval or liens on payments of cash values and policy loans, or on any other right to withdraw funds held in conjunction with those policies or contracts, in addition to any contractual provisions for deferral of cash or policy loan value. If the court imposes a temporary moratorium or a moratorium charge on the payment of cash values or policy loans out of the assets of the insolvent insurer, or on any other right to withdraw, out of those assets, funds held in conjunction with those policies or contracts, the fund may defer the payment of cash values and policy loans and other rights to withdraw funds for the period of the moratorium or moratorium charge imposed by the court, except for any claims covered by the fund to be paid in accordance with a hardship procedure established by the liquidator and approved by the court.
261,104 Section 104. 646.31 (10) (b) of the statutes is created to read:
646.31 (10) (b) Permanent policy or contract liens in connection with a guarantee, assumption, or reinsurance agreement, if the board finds that the amounts that may be assessed under this chapter are insufficient to ensure full and prompt performance of the fund's duties under this chapter, or that economic or financial conditions, as they affect insurers, are such that imposing such permanent policy or contract liens is in the public interest.
261,105 Section 105. 646.31 (11) of the statutes is amended to read:
646.31 (11) Subrogation claims. The fund is not required to pay any amount due from the insurer to any reinsurer, insurer, insurance pool or underwriting association as subrogation, contribution, or indemnification recoveries or otherwise, except as provided in sub. (2) (a). A reinsurer, insurer, insurance pool or underwriting association that has paid a claim and thereby has become subrogated or otherwise entitled to the amount of that claim may assert that claim against the liquidator of the insurer in liquidation but not against the insured of the insurer in liquidation.
261,106 Section 106. 646.31 (13) of the statutes is renumbered 646.31 (13) (intro.) and amended to read:
646.31 (13) Residency. (intro.) For purposes of determining residency in this section, the:
(a) The residency of a claimant, insured, or policyholder that is not a natural person is the state in which the claimant's, insured's, or policyholder's principal place of business is located.
261,107 Section 107. 646.31 (13) (b) of the statutes is created to read:
646.31 (13) (b) In the case of a life or disability insurance policy or an annuity contract, residency means residency at the time of the liquidation order. In the case of any other kind of insurance covered by this chapter, residency means residency at the time of the insured event.
261,108 Section 108. 646.31 (13) (c) of the statutes is created to read:
646.31 (13) (c) A person's residency may be in only one state.
261,109 Section 109. 646.31 (13) (d) of the statutes is created to read:
646.31 (13) (d) If a person who is a citizen of the United States is a resident of a foreign country, or of a possession, territory, or protectorate of the United States, that does not have an organization similar to the fund, the person's residency is the domicile of the insurer that issued the policy or contract.
261,110 Section 110. 646.32 (1) of the statutes is amended to read:
646.32 (1) Appeal. A claimant whose claim is reduced or declared ineligible shall promptly be given notice of the determination and of the right to object under this section. The claimant may appeal to the board within 30 days after the mailing of the notice. The claimant may not pursue the claim in court except as provided in sub. (2).
261,111 Section 111. 646.325 (1) of the statutes is amended to read:
646.325 (1) Definition. In this section, "net worth" means the amount of an insured's total assets less the insured's total liabilities at the end of the insured's fiscal year immediately preceding the date the liquidation order was entered, as shown on the insured's audited financial statement, or, if and includes the consolidated net worth of all of the corporate affiliates, subsidiaries, operating divisions, holding companies, and parent entities that are shown as insureds or additional insureds on the policy issued by the insurer. If the insured is a natural person, "net worth" means the insured's total assets less the insured's total liabilities on December 31 immediately preceding the date the liquidation order was entered.
261,112 Section 112. 646.325 (2) (intro.) of the statutes is amended to read:
646.325 (2) Recovery from certain insureds and affiliates. (intro.) Except as provided in sub. (3), the fund may recover from a person the costs and expenses incurred in defending a claim against the person by a 3rd party and the amount of any claim paid on behalf of that the person to a 3rd party, if all of the following conditions are satisfied:
261,113 Section 113. 646.325 (2) (a) (intro.) of the statutes is amended to read:
646.325 (2) (a) (intro.) The person on whose behalf the claim was defended or paid is any of the following:
261,114 Section 114. 646.325 (2) (b) of the statutes is amended to read:
646.325 (2) (b) Payment Adjudication of the claim resulted in no liability obligation on the person to pay the claim of the 3rd party or payment of the claim satisfied all or part of the person's liability obligations to 3rd parties.
261,115 Section 115. 646.33 (1) of the statutes is renumbered 646.33 (1) (a) and amended to read:
646.33 (1) (a) Upon payment to any loss claimant the fund is subrogated to the claimant's full right of recovery against the insurer, and, to the same extent the insurer would have been subrogated, against any liquidator and any 3rd person. A person receiving benefits under this chapter thereby assigns to the fund the person's rights under, and any causes of action against any person for losses arising under, resulting from, or otherwise relating to, the covered policy or contract to the extent of the benefits received, regardless of whether the benefits are payments of or on account of contractual obligations, continuation of coverage, or the provision of substitute or alternative coverages.
(2m) Recovery. (a) On recovery under this section, the fund may retain both the amount it has paid to the claimant and the amount it has expended to obtain the recovery and shall pay any balance to the claimant.
261,116 Section 116. 646.33 (1) (b), (c) and (d) of the statutes are created to read:
646.33 (1) (b) The subrogation rights of the fund under this subsection have the same priority against the assets of the insolvent insurer as the claimant's rights with respect to the insurer.
(c) In addition to the rights specified in pars. (a) and (b), the fund has all of the common law rights of subrogation and any other equitable or legal remedy that would have been available to the insolvent insurer or the claimant with respect to the covered policy or contract including, in the case of a structured settlement annuity, any rights of the owner, beneficiary, or payee of the annuity, to the extent of the benefits received under this chapter, against a person originally or by succession responsible for the losses that arise from the personal injury and that relate to the annuity or its payment.
(d) If any provision of this subsection is invalid or ineffective for any reason with respect to any person or claim, the amount payable by the fund with respect to the related covered obligations shall be reduced by any amount realized by any other person with respect to the person or claim that is attributable to the covered policy or contract.
261,117 Section 117. 646.33 (2) of the statutes is amended to read:
646.33 (2) Cooperation. The claimant shall cooperate with the board fund in pursuing the fund's rights under sub. (1), including executing any necessary documents. If cooperation is withheld unreasonably, the fund may recover from the claimant any amount it has paid the claimant. The fund may require a claimant to execute a written assignment to it of the claimant's rights and causes of action relating to the covered policy or contract as a condition precedent to the receipt of any right or benefits under this chapter.
261,118 Section 118. 646.33 (2m) (b) of the statutes is created to read:
646.33 (2m) (b) If a claimant to whom the fund has provided benefits under this chapter recovers amounts with respect to which the fund has rights under this section, the claimant shall pay to the fund the portion of the recovery that is attributable to the covered policy or contract.
261,119 Section 119. 646.33 (3) of the statutes is amended to read:
646.33 (3) Claims against liquidator. The board fund shall report periodically and whenever a reasonable request is made to any liquidator against whom subrogation rights exist under sub. (1) the claims paid and rejected together with estimates of unsettled claims made or anticipated against the fund.
261,120 Section 120. 646.35 (2) of the statutes is repealed.
261,121 Section 121. 646.35 (3) (title) of the statutes is amended to read:
646.35 (3) (title) Nondomestic insurer Insurer in liquidation.
261,122 Section 122. 646.35 (3) (intro.) (except 646.35 (3) (title)) of the statutes is renumbered 646.35 (3) (am) (intro.) and amended to read:
646.35 (3) (am) (intro.) If a nondomestic an insurer that is subject to this chapter is in liquidation, the board fund shall, subject to the approval of the commissioner and on a determination by the commissioner that the insurer's domiciliary jurisdiction or state of entry does not provide by statute for protection to residents of this state substantially similar to that provided by this section s. 646.31 (2), do either of the following:
261,123 Section 123. 646.35 (3) (a) of the statutes is renumbered 646.35 (3) (am) 1. and amended to read:
646.35 (3) (am) 1. Guarantee, assume, or reinsure, or cause to be guaranteed, assumed, or reinsured, the policies of residents the insolvent insurer within the scope of this section;.
261,124 Section 124. 646.35 (3) (b) of the statutes is renumbered 646.35 (3) (am) 2. and amended to read:
646.35 (3) (am) 2. Assure performance of the contractual obligations of the insurer on such policies; and.
261,125 Section 125. 646.35 (3) (c) of the statutes is renumbered 646.35 (3) (bm) and amended to read:
646.35 (3) (bm) Provide the necessary money Whether the fund's duties under par. (am) are discharged by the fund under par. (am) 1. or 2. is at the fund's discretion. The fund shall provide moneys, pledges, loans, notes, guarantees, or other means reasonably necessary to discharge the duties under pars. (a) and (b) par. (am) 1. or 2.
261,126 Section 126. 646.35 (4) of the statutes is renumbered 646.35 (4) (a) and amended to read:
646.35 (4) (a) The fund has a claim against the liquidator for reasonable payments made to discharge its duties under this section. If the board fund and the liquidator disagree regarding the reasonableness of such payments, either may apply to the court to determine the question. Such payments shall have the same priority as the class of claims under s. 645.68 (3).
261,127 Section 127. 646.35 (4) (b) of the statutes is created to read:
646.35 (4) (b) As a creditor of the insolvent insurer, the fund shall be entitled to receive disbursements of assets out of marshaled assets, consistent with s. 645.72 and any substantially similar laws of other states, as a credit against obligations under this chapter. If, within 120 days after a final determination of an insurer's insolvency by the receivership court, the liquidator has not applied to the court for approval of a proposal for disbursement of assets out of marshaled assets to insurance guaranty associations having obligations because of the insolvency, the fund may apply to the receivership court, in accordance with the law of the insolvent insurer's domicile, for approval of its own proposal for disbursement of the assets.
261,128 Section 128. 646.35 (5) of the statutes is amended to read:
646.35 (5) Rate increases. The board fund may increase any rates or premiums on policies during continuation of coverage under sub. (2) (b) or (3) (b) (am) 2. to the extent the policies permit the insurer to increase the rates or premiums. If the board fund determines that the rates or premiums on policies which that do not permit an increase or the rates or premiums as increased to the extent permitted by the policies are inadequate under s. 625.11 (3), the board fund may offer the policyholders the option of terminating the coverage or continuing the coverage at adequate rates or premiums as determined by the board fund.
261,129 Section 129. 646.35 (6) (a) of the statutes is amended to read:
646.35 (6) (a) In the case of an annuity contract, the board fund may limit its performance to payment of the then current value of the loss claim under s. 645.68 (3) as of the date of the order of liquidation, with interest to the date of payment, in lieu of the requirements of sub. (2) or (3).
261,130 Section 130. 646.35 (6) (b) of the statutes is amended to read:
646.35 (6) (b) In the case of a disability insurance policy which that is neither guaranteed renewable nor noncancelable, the board fund is not obligated to continue the policy in force beyond the time required under s. 645.43 or the date established in the liquidation order of another state, but may continue the coverage under any disability insurance policy for up to 180 days after the date of the liquidation order. The commissioner may adopt rules defining "guaranteed renewable" and "noncancelable" for the purposes of this paragraph.
261,131 Section 131. 646.35 (6) (bm) of the statutes is amended to read:
646.35 (6) (bm) For coverages continued pursuant to par. (b), the board fund may substitute a comprehensive health insurance policy approved by the commissioner for a health maintenance organization policy that is subject to sub. (2) or (3), and increase rates or premiums for the substituted coverage as provided in sub. (5).
261,132 Section 132. 646.35 (6) (c) (intro.) of the statutes is amended to read:
646.35 (6) (c) (intro.) In the case of a life insurance or annuity contract, the board fund is not obligated to perform the responsibilities set forth in sub. (2) or (3) with respect to either of the following:
261,133 Section 133. 646.35 (6) (c) 1. (intro.) of the statutes is amended to read:
646.35 (6) (c) 1. (intro.) Any benefit payment liability, arising on or after the date of entry of the order of liquidation, to the extent that the payment is based upon a rate of interest that rate of interest on which it is based or the interest rate, crediting rate, or similar factor determined by use of an index or other external reference stated in the policy or contract and employed in calculating returns or changes in value exceeds the larger smaller of the following:
261,134 Section 134. 646.35 (6) (c) 1. b. of the statutes is amended to read:
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