AB917: Bill Text

LRB-3732/3

CMH&ARG:kmg:rs

2003 - 2004 LEGISLATURE

2003 Assembly BILL 917

February 26, 2004 - Introduced by Representatives Ladwig, J. Lehman, McCormick, Kerkman, Hundertmark and Albers, cosponsored by Senator Schultz. Referred to Committee on Insurance.

AB917,1,3 An Act to amend 815.18 (3) (f); and to create 815.18 (2) (am) of the statutes; relating to: life insurance and annuity contract exemptions from creditor claims.

Analysis by the Legislative Reference Bureau

Current law exempts from creditor claims any unmatured life insurance contract that is owned by the debtor and that insures the debtor, his or her dependent, or a person on whom the debtor is dependent (life insurance contract). Current law also exempts from creditor claims a maximum of $4,000 of the debtor's aggregate interest in any accrued dividends, interest, or loan value of his or her life insurance contract (aggregate interest). This bill removes the $4,000 limit on the aggregate interest. The bill also exempts from creditor claims the entire value of a life insurance contract and the aggregate interest only if the life insurance contract was issued at least 24 months before the creditor claim. If the contract was issued less than 24 months before the creditor claim, the exemption may not exceed $4,000.

Current law does not address exemptions from creditor claims for an unmatured annuity that is owned by the debtor and that insures the debtor, his or her dependent, or a person on whom the debtor is dependent (annuity contract) or the debtor's aggregate interest in any accrued dividends, interest, or loan values of his or her annuity contract (aggregate interest). The bill exempts from creditor claims the entire value of an unmatured annuity contract and the aggregate interest only if the annuity contract was issued at least 24 months before the creditor claim. If the contract was issued less than 24 months before the creditor claim, the exemption may not exceed $4,000.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB917, s. 1 Section 1. 815.18 (2) (am) of the statutes is created to read:

AB917,2,3 815.18 (2) (am) "Annuity" means a series of payments payable during the life of the annuitant or during a specific period.

AB917, s. 2 Section 2. 815.18 (3) (f) of the statutes is amended to read:

AB917,2,14 815.18 (3) (f) Life insurance and annuities. Any unmatured life insurance or annuity contract owned by the debtor and insuring the debtor, the debtor's dependent, or an individual of whom the debtor is a dependent, other than a credit life insurance contract, and the debtor's aggregate interest, not to exceed $4,000 in value, in any accrued dividends, interest, or loan value of all unmatured life insurance or annuity contracts owned by the debtor and insuring the debtor, the debtor's dependent, or an individual of whom the debtor is a dependent, except that if the life insurance or annuity contract was issued less than 24 months before the creditor's claim against the debtor, the exemption under this paragraph may not exceed $4,000.

AB917, s. 3 Section 3. Initial applicability.

AB917,2,17 (1) The treatment of section 815.18 (3) (f) of the statutes first applies to life insurance or annuity contracts issued on the effective date of this subsection.

AB917,2,18 (End)