SB320, s. 88
14Section
88. 646.31 (2) (b) 3. of the statutes is repealed.
SB320, s. 89
15Section
89. 646.31 (2) (f) (title) of the statutes is amended to read:
SB320,31,1716
646.31
(2) (f) (title)
Beneficiaries, assignees, and payees; life or disability policy
17or annuity contract.
SB320, s. 90
18Section
90. 646.31 (2) (f) 2. of the statutes is amended to read:
SB320,31,2019
646.31
(2) (f) 2. The person is a resident of this state or could have made a claim
20under par. (b)
2.
SB320, s. 91
21Section
91. 646.31 (2) (g) of the statutes is created to read:
SB320,32,222
646.31
(2) (g)
Payees; structured settlement annuity. 1. Notwithstanding par.
23(f), the claim of a payee, or of a beneficiary of a deceased payee, under a structured
24settlement annuity if the payee, or deceased payee's beneficiary, is a resident of this
1state, regardless of where the policyholder of the structured settlement annuity
2resides.
SB320,32,93
2. Notwithstanding pars. (b) and (f), the claim of a payee, or of a beneficiary of
4a deceased payee, under a structured settlement annuity if the payee, or deceased
5payee's beneficiary, is not a resident of this state, if neither the payee, or deceased
6payee's beneficiary, nor the policyholder of the structured settlement annuity is
7eligible for coverage by an organization that is comparable to the fund in the state
8of which the payee, or deceased payee's beneficiary, or the policyholder is a resident,
9and if either of the following applies:
SB320,32,1010
a. The policyholder is a resident of this state.
SB320,32,1311
b. The policyholder is not a resident of this state, but the insurer that issued
12the structured settlement annuity is domiciled in this state, and the state in which
13the policyholder resides has an organization that is comparable to the fund.
SB320, s. 92
14Section
92. 646.31 (3) of the statutes is repealed.
SB320, s. 93
15Section
93. 646.31 (5) of the statutes is repealed.
SB320, s. 94
16Section
94. 646.31 (6) (a) of the statutes is amended to read:
SB320,32,2317
646.31
(6) (a) The portion of
a
an otherwise eligible loss claim for which
18indemnification is provided by other benefits or advantages, which may not be
19included in the classes of claims specified in s. 645.68 (intro.), may not be claimed
20from the fund under this chapter
or from the insured or policyholder. The claimant
21must exhaust such collateral sources before pursuing payment from the fund. This
22paragraph does not apply to the claim of an insured or payee under a structured
23settlement annuity.
SB320, s. 95
24Section
95. 646.31 (6) (b) of the statutes is amended to read:
SB320,33,3
1646.31
(6) (b) The
board
fund may waive the application of par. (a) to claims
2under contracts subject to s. 646.35
(2) or (3), to the extent that the
board fund 3determines that application of par. (a) would be impracticable.
SB320, s. 96
4Section
96. 646.31 (7) of the statutes is amended to read:
SB320,33,85
646.31
(7) Setoffs and counterclaims. Section 645.56 applies to the
6settlement of loss claims. The
board fund shall give the liquidator a reasonable
7opportunity to inform the
board fund of possible setoffs and counterclaims before
8paying loss claims.
SB320, s. 97
9Section
97. 646.31 (8) of the statutes is amended to read:
SB320,33,1210
646.31
(8) Notice to claimants. The
board fund shall provide notice under s.
11645.47 (2) to those potential loss claimants to whom the fund is liable under the
12section, if the liquidator has not done so.
SB320, s. 98
13Section
98. 646.31 (9) (a) of the statutes is amended to read:
SB320,33,1514
646.31
(9) (a) By any security fund with an obligation to pay all loss claims of
15the insurer
;.
SB320, s. 99
16Section
99. 646.31 (9) (b) of the statutes is amended to read:
SB320,33,1817
646.31
(9) (b) If it is a first party claim for damage to property with a permanent
18location, by the fund of the location of the property
;
.
SB320, s. 100
19Section
100. 646.31 (9) (c) of the statutes is amended to read:
SB320,33,2120
646.31
(9) (c) If it is a workers' compensation claim, by the fund of the residence
21of the claimant
;.
SB320, s. 101
22Section
101. 646.31 (9) (cm) of the statutes is created to read:
SB320,33,2423
646.31
(9) (cm) If it is a liability claim, by the fund of the residence of the
24policyholder.
SB320, s. 102
25Section
102. 646.31 (9) (d) of the statutes is amended to read:
SB320,34,1
1646.31
(9) (d) In any other case, by the fund of the residence of the insured
; and.
SB320, s. 103
2Section
103. 646.31 (10) of the statutes is renumbered 646.31 (10) (intro.) and
3amended to read:
SB320,34,64
646.31
(10) Temporary moratoriums. (intro.) Before being obligated to make
5payments under this chapter to holders of life insurance or annuity contracts the
6fund may impose, with court approval,
temporary any of the following:
SB320,34,20
7(a) Temporary moratoriums
of not more than 90 days on payments of cash
8values and policy loans in addition to any deferrals of cash or policy loan value by
9contractual provision. A temporary moratorium may be renewed for successive
10periods of not more than 90 days with court approval or liens on payments of cash
11values and policy loans, or on any other right to withdraw funds held in conjunction
12with those policies or contracts, in addition to any contractual provisions for deferral
13of cash or policy loan value. If the court imposes a temporary moratorium or a
14moratorium charge on the payment of cash values or policy loans out of the assets
15of the insolvent insurer, or on any other right to withdraw, out of those assets, funds
16held in conjunction with those policies or contracts, the fund may defer the payment
17of cash values and policy loans and other rights to withdraw funds for the period of
18the moratorium or moratorium charge imposed by the court, except for any claims
19covered by the fund to be paid in accordance with a hardship procedure established
20by the liquidator and approved by the court.
SB320, s. 104
21Section
104. 646.31 (10) (b) of the statutes is created to read:
SB320,35,222
646.31
(10) (b) Permanent policy or contract liens in connection with a
23guarantee, assumption, or reinsurance agreement, if the board finds that the
24amounts that may be assessed under this chapter are insufficient to ensure full and
25prompt performance of the fund's duties under this chapter, or that economic or
1financial conditions, as they affect insurers, are such that imposing such permanent
2policy or contract liens is in the public interest.
SB320, s. 105
3Section
105. 646.31 (11) of the statutes is amended to read:
SB320,35,114
646.31
(11) Subrogation claims. The fund is not required to pay any amount
5due from the insurer to any reinsurer, insurer, insurance pool or underwriting
6association as subrogation
, contribution, or indemnification recoveries or otherwise,
7except as provided in sub. (2) (a). A reinsurer, insurer, insurance pool or
8underwriting association that has paid a claim and thereby has become subrogated
9or otherwise entitled to the amount of that claim may assert that claim against the
10liquidator of the insurer in liquidation but not against the insured of the insurer in
11liquidation.
SB320, s. 106
12Section
106. 646.31 (13) of the statutes is renumbered 646.31 (13) (intro.) and
13amended to read:
SB320,35,1514
646.31
(13) Residency. (intro.) For purposes of determining residency in this
15section
, the:
SB320,35,18
16(a) The residency of a claimant, insured
, or policyholder that is not a natural
17person is the state in which the claimant's, insured's
, or policyholder's principal place
18of business is located.
SB320, s. 107
19Section
107. 646.31 (13) (b) of the statutes is created to read:
SB320,35,2320
646.31
(13) (b) In the case of a life or disability insurance policy or an annuity
21contract, residency means residency at the time of the liquidation order. In the case
22of any other kind of insurance covered by this chapter, residency means residency at
23the time of the insured event.
SB320, s. 108
24Section
108. 646.31 (13) (c) of the statutes is created to read:
SB320,35,2525
646.31
(13) (c) A person's residency may be in only one state.
SB320, s. 109
1Section
109. 646.31 (13) (d) of the statutes is created to read:
SB320,36,52
646.31
(13) (d) If a person who is a citizen of the United States is a resident of
3a foreign country, or of a possession, territory, or protectorate of the United States,
4that does not have an organization similar to the fund, the person's residency is the
5domicile of the insurer that issued the policy or contract.
SB320, s. 110
6Section
110. 646.32 (1) of the statutes is amended to read:
SB320,36,117
646.32
(1) Appeal. A claimant whose claim is reduced or declared ineligible
8shall promptly be given notice of the determination and of the right to object under
9this section. The claimant may appeal to the board within 30 days after the mailing
10of the notice.
The claimant may not pursue the claim in court except as provided in
11sub. (2).
SB320, s. 111
12Section
111. 646.325 (1) of the statutes is amended to read:
SB320,36,2113
646.325
(1) Definition. In this section, "net worth" means the amount of an
14insured's total assets less the insured's total liabilities at the end of the insured's
15fiscal year immediately preceding the date the liquidation order was entered, as
16shown on the insured's audited financial statement,
or, if and includes the
17consolidated net worth of all of the corporate affiliates, subsidiaries, operating
18divisions, holding companies, and parent entities that are shown as insureds or
19additional insureds on the policy issued by the insurer. If the insured is a natural
20person,
"net worth" means the insured's total assets less the insured's total liabilities
21on December 31 immediately preceding the date the liquidation order was entered.
SB320, s. 112
22Section
112. 646.325 (2) (intro.) of the statutes is amended to read:
SB320,37,223
646.325
(2) Recovery from certain insureds and affiliates. (intro.) Except
24as provided in sub. (3), the fund may recover from a person the
costs and expenses
25incurred in defending a claim against the person by a 3rd party and the amount of
1any claim paid on behalf of
that the person to a 3rd party, if all of the following
2conditions are satisfied:
SB320, s. 113
3Section
113. 646.325 (2) (a) (intro.) of the statutes is amended to read:
SB320,37,54
646.325
(2) (a) (intro.) The person on whose behalf the claim was
defended or 5paid is any of the following:
SB320, s. 114
6Section
114. 646.325 (2) (b) of the statutes is amended to read:
SB320,37,97
646.325
(2) (b)
Payment Adjudication of the claim resulted in no liability
8obligation on the person to pay the claim of the 3rd party or payment of the claim
9satisfied all or part of the person's liability obligations to 3rd parties.
SB320, s. 115
10Section
115. 646.33 (1) of the statutes is renumbered 646.33 (1) (a) and
11amended to read:
SB320,37,2012
646.33
(1) (a) Upon payment to any loss claimant the fund is subrogated to the
13claimant's full right of recovery against the insurer
, and
, to the same extent the
14insurer would have been subrogated, against any liquidator and any 3rd person.
A
15person receiving benefits under this chapter thereby assigns to the fund the person's
16rights under, and any causes of action against any person for losses arising under,
17resulting from, or otherwise relating to, the covered policy or contract to the extent
18of the benefits received, regardless of whether the benefits are payments of or on
19account of contractual obligations, continuation of coverage, or the provision of
20substitute or alternative coverages.
SB320,37,23
21(2m) Recovery. (a) On recovery under this section, the fund may retain both
22the amount it has paid to the claimant and the amount it has expended to obtain the
23recovery and shall pay any balance to the claimant.
SB320, s. 116
24Section
116. 646.33 (1) (b), (c) and (d) of the statutes are created to read:
SB320,38,3
1646.33
(1) (b) The subrogation rights of the fund under this subsection have the
2same priority against the assets of the insolvent insurer as the claimant's rights with
3respect to the insurer.
SB320,38,114
(c) In addition to the rights specified in pars. (a) and (b), the fund has all of the
5common law rights of subrogation and any other equitable or legal remedy that
6would have been available to the insolvent insurer or the claimant with respect to
7the covered policy or contract including, in the case of a structured settlement
8annuity, any rights of the owner, beneficiary, or payee of the annuity, to the extent
9of the benefits received under this chapter, against a person originally or by
10succession responsible for the losses that arise from the personal injury and that
11relate to the annuity or its payment.
SB320,38,1612
(d) If any provision of this subsection is invalid or ineffective for any reason
13with respect to any person or claim, the amount payable by the fund with respect to
14the related covered obligations shall be reduced by any amount realized by any other
15person with respect to the person or claim that is attributable to the covered policy
16or contract.
SB320, s. 117
17Section
117. 646.33 (2) of the statutes is amended to read:
SB320,38,2418
646.33
(2) Cooperation. The claimant shall cooperate with the
board fund in
19pursuing the fund's rights under sub. (1), including executing any necessary
20documents. If cooperation is withheld unreasonably, the fund may recover from the
21claimant any amount it has paid the claimant.
The fund may require a claimant to
22execute a written assignment to it of the claimant's rights and causes of action
23relating to the covered policy or contract as a condition precedent to the receipt of any
24right or benefits under this chapter.
SB320, s. 118
25Section
118. 646.33 (2m) (b) of the statutes is created to read:
SB320,39,4
1646.33
(2m) (b) If a claimant to whom the fund has provided benefits under this
2chapter recovers amounts with respect to which the fund has rights under this
3section, the claimant shall pay to the fund the portion of the recovery that is
4attributable to the covered policy or contract.
SB320, s. 119
5Section
119. 646.33 (3) of the statutes is amended to read:
SB320,39,96
646.33
(3) Claims against liquidator. The
board fund shall report periodically
7and whenever a reasonable request is made to any liquidator against whom
8subrogation rights exist under sub. (1) the claims paid and rejected together with
9estimates of unsettled claims made or anticipated against the fund.
SB320, s. 120
10Section
120. 646.35 (2) of the statutes is repealed.
SB320, s. 121
11Section
121. 646.35 (3) (title) of the statutes is amended to read:
SB320,39,1212
646.35
(3) (title)
Nondomestic insurer Insurer in liquidation.
SB320, s. 122
13Section
122. 646.35 (3) (intro.) (except 646.35 (3) (title)) of the statutes is
14renumbered 646.35 (3) (am) (intro.) and amended to read:
SB320,39,2015
646.35
(3) (am) (intro.) If
a nondomestic an insurer
that is subject to this
16chapter is in liquidation, the
board fund shall, subject to
the approval of the
17commissioner and on a determination by the commissioner that the insurer's
18domiciliary jurisdiction or state of entry does not provide by statute for protection to
19residents of this state substantially similar to that provided by this section s. 646.31
20(2), do either of the following:
SB320, s. 123
21Section
123. 646.35 (3) (a) of the statutes is renumbered 646.35 (3) (am) 1. and
22amended to read:
SB320,39,2523
646.35
(3) (am) 1. Guarantee, assume
, or reinsure
, or cause to be guaranteed,
24assumed
, or reinsured
, the policies of
residents the insolvent insurer within the
25scope of this section
;.
SB320, s. 124
1Section
124. 646.35 (3) (b) of the statutes is renumbered 646.35 (3) (am) 2. and
2amended to read:
SB320,40,43
646.35
(3) (am) 2. Assure performance of the contractual obligations of the
4insurer on such policies
; and.
SB320, s. 125
5Section
125. 646.35 (3) (c) of the statutes is renumbered 646.35 (3) (bm) and
6amended to read:
SB320,40,117
646.35
(3) (bm)
Provide the necessary money Whether the fund's duties under
8par. (am) are discharged by the fund under par. (am) 1. or 2. is at the fund's discretion.
9The fund shall provide moneys, pledges, loans, notes, guarantees, or other means
10reasonably necessary to discharge the duties under
pars. (a) and (b) par. (am) 1. or
112.
SB320, s. 126
12Section
126. 646.35 (4) of the statutes is renumbered 646.35 (4) (a) and
13amended to read:
SB320,40,1814
646.35
(4) (a) The fund has a claim against the liquidator for reasonable
15payments made to discharge its duties under this section. If the
board fund and the
16liquidator disagree regarding the reasonableness of such payments, either may
17apply to the court to determine the question. Such payments shall have the same
18priority as the class of claims under s. 645.68 (3).
SB320, s. 127
19Section
127. 646.35 (4) (b) of the statutes is created to read:
SB320,41,320
646.35
(4) (b) As a creditor of the insolvent insurer, the fund shall be entitled
21to receive disbursements of assets out of marshaled assets, consistent with s. 645.72
22and any substantially similar laws of other states, as a credit against obligations
23under this chapter. If, within 120 days after a final determination of an insurer's
24insolvency by the receivership court, the liquidator has not applied to the court for
25approval of a proposal for disbursement of assets out of marshaled assets to
1insurance guaranty associations having obligations because of the insolvency, the
2fund may apply to the receivership court, in accordance with the law of the insolvent
3insurer's domicile, for approval of its own proposal for disbursement of the assets.
SB320, s. 128
4Section
128. 646.35 (5) of the statutes is amended to read:
SB320,41,125
646.35
(5) Rate increases. The
board fund may increase any rates or premiums
6on policies during continuation of coverage under sub.
(2) (b) or (3)
(b) (am) 2. to the
7extent the policies permit the insurer to increase the rates or premiums. If the
board 8fund determines that the rates or premiums on policies
which that do not permit an
9increase or the rates or premiums as increased to the extent permitted by the policies
10are inadequate under s. 625.11 (3), the
board fund may offer the policyholders the
11option of terminating the coverage or continuing the coverage at adequate rates or
12premiums as determined by the
board fund.
SB320, s. 129
13Section
129. 646.35 (6) (a) of the statutes is amended to read:
SB320,41,1714
646.35
(6) (a) In the case of an annuity contract, the
board fund may limit its
15performance to payment of the then current value of the loss claim under s. 645.68
16(3) as of the date of the order of liquidation, with interest to the date of payment, in
17lieu of the requirements of sub.
(2) or (3).
SB320, s. 130
18Section
130. 646.35 (6) (b) of the statutes is amended to read: