SB513: Bill Text

SB513,52,13 d. The National Association of Insurance Commissioners, the Financial Industry Regulatory Authority, the North American Securities Administrators Association, or their employees, agents, or representatives or other regulatory body overseeing life insurance, life settlements, securities, or investment fraud.

SB513,52,14 e. The life insurer that issued the policy covering the life of the insured.

SB513,52,18 2. This paragraph does not abrogate or modify common law or statutory privileges or immunities enjoyed by a person who supplies information concerning suspected, anticipated, or completed fraudulent acts related to life settlements or insurance.

SB513,53,8 (g) Information, documents, and evidence provided under par. (e) or obtained by the commissioner in an investigation of suspected or actual violations of this subsection or sub. (13) shall be privileged and confidential, shall not be a public record, and shall not be subject to discovery or subpoena in a civil or criminal action. The commissioner may release information, documents, and evidence provided under par. (e) or obtained in an investigation of suspected or actual violations of this subsection or sub. (13) in administrative or judicial proceedings to enforce laws administered by the commissioner, to federal, state, or local law enforcement or regulatory agencies, to an organization established for the purpose of detecting and preventing fraud related to life settlements, to the National Association of Insurance Commissioners, or, at the discretion of the commissioner, to a person in the business of life settlements that is aggrieved by a violation of this subsection or sub. (13). Release by the commissioner of information, documents, and evidence as set forth in this paragraph does not abrogate, modify, or waive the privilege established in this paragraph.

SB513,53,9 (h) This section does not do any of the following:

SB513,53,12 1. Preempt the authority or relieve the duty of law enforcement or regulatory agencies other than the commissioner to investigate, examine, and prosecute suspected violations of law.

SB513,53,15 2. Prevent or prohibit a person from disclosing voluntarily information concerning life settlement fraud to a law enforcement or regulatory agency other than the commissioner.

SB513,53,18 3. Limit the powers granted elsewhere by the laws of this state to the commissioner to investigate and examine possible violations of law and to take appropriate action.

SB513,53,23 (i) 1. Providers and brokers shall have in place antifraud initiatives reasonably calculated to detect, prosecute, and prevent violations of this subsection and sub. (13). The commissioner may modify the antifraud initiatives from time to time as necessary to ensure an effective antifraud program and to accomplish the purpose of this paragraph.

SB513,54,2 2. Antifraud initiatives shall include having fraud investigators, who may be employees of the provider or broker or who may be independent contractors, and an antifraud plan, which the provider or broker shall submit to the commissioner and which shall include all of the following:

SB513,54,6 a. A description of the procedures that the provider or broker will use for detecting and investigating possible fraud and violations of this subsection and sub. (13) and for resolving material inconsistencies between medical records and insurance applications.

SB513,54,8 b. A description of the procedures that the provider or broker will use for reporting possible violations of this subsection and sub. (13) to the commissioner.

SB513,54,10 c. A description of the plan that the provider or broker will follow for antifraud education and training of underwriters and other personnel.

SB513,54,14 d. A description or chart outlining the organizational arrangement of the antifraud personnel who are responsible for investigating and reporting possible violations of this subsection and sub. (13) and investigating unresolved material inconsistencies between medical records and insurance applications.

SB513,54,17 3. Antifraud plans submitted to the commissioner are privileged and confidential, are not a public record, and are not subject to discovery or subpoena in a civil or criminal action.

SB513,54,22 (16) Conflicts of law. If there is more than one owner on a single policy and the owners are residents of different states, a life settlement shall be governed by the law of the state in which the owner having the largest percentage ownership resides or, if the owners hold equal ownership, the state of residence of one owner agreed upon in writing by all owners.

SB513,54,25 (17) Fraternal benefit societies. Nothing in this section shall prohibit a fraternal benefit society under ch. 614 from enforcing the terms of its bylaws or rules regarding permitted beneficiaries and owners.

SB513,55,3 (18) Civil action. Any person damaged by a violation of this section may bring a civil action against the person committing the violation in a court of competent jurisdiction.

SB513,55,6 (19) Penalties. Any person who violates this section is subject to the penalties provided under s. 601.64, suspension or revocation of a license or certificate of authority, and an order under s. 601.41.

SB513,55,7 (20) Powers of commissioner. The commissioner may do any of the following:

SB513,55,8 (a) Adopt rules implementing and administering this section.

SB513,55,13 (b) Establish standards for evaluating the reasonableness of payments under life settlement contracts for persons who are terminally or chronically ill, including regulation of discount rates used to determine the amount paid in exchange for assignment, transfer, sale, devise, or bequest of a benefit under a policy insuring the life of a person who is terminally or chronically ill.

SB513,55,15 (c) Establish appropriate licensing requirements and standards for continued licensure for providers and brokers.

SB513,55,17 (d) Require a bond or other mechanism for financial accountability for providers and brokers.

SB513,55,19 (e) Adopt rules governing the relationship and responsibilities of insurers, providers, and brokers during settlement of a policy.

SB513, s. 17 Section 17. Initial applicability.

SB513,55,22 (1) This act first applies to life settlement contracts and purchase agreements entered into on the effective date of this subsection

SB513, s. 18 Section 18. Effective date.

SB513,56,2 (1) This act takes effect on the first day of the 6th month beginning after publication.

SB513,56,3 (End)