631.11 Annotation
Where question on form calls for applicant's judgment or opinion as layman, any ambiguity should be construed against company. Nolden v. Mutual Benefit Life Ins. Co. 80 W (2d) 353, 259 NW (2d) 75.
631.11 Annotation
Insured's contradictory statements constituted a breach of contractual duties of notice and cooperation. Dietz v. Hardware Dealers Mut. Fire Ins. Co. 88 W (2d) 496, 276 NW (2d) 808 (1979).
631.11 Annotation
See note to 632.32, citing Rauch v. American Fam. Ins. Co. 115 W (2d) 257, 340 NW (2d) 478 (1983).
631.11 Annotation
Sub. (2) applies reliance test to misrepresentations made in negotiation or application for insurance, not in proofs of loss. Tempelis v. Aetna Casualty & Surety Co., 164 W (2d) 17, 473 NW (2d) 549 (Ct. App. 1991).
631.13
631.13
Incorporation by reference. No insurance contract may contain any agreement or incorporate any provision not fully set forth in the policy or in an application or other document attached to and made a part of the policy at the time of its delivery except that:
631.13(1)
(1) Rates. Any policy may by reference incorporate rate schedules and classifications of risks and short-rate tables filed with the commissioner; and
631.13(2)
(2) Complex contracts. By rule or order or by approval of a form the commissioner may authorize for complex contracts incorporation by reference of provisions for administrative arrangements, premium schedules and payment procedures.
631.13 History
History: 1975 c. 375.
631.15
631.15
Contract rights under noncomplying policies. 631.15(1)(1)
Enforcement of policy terms. Except as otherwise specifically provided by statute, a policy is enforceable against the insurer according to its terms, even if it exceeds the authority of the insurer.
631.15(3m)
(3m) Enforcement of statute and rule requirements. A policy that violates a statute or rule is enforceable against the insurer as if it conformed to the statute or rule.
631.15(4)
(4) Reformation of contract. Upon written request of the policyholder or an insured whose rights under the policy are continuing and not transitory, an insurer shall reform and reissue its written policy to comply with the requirements of the law existing at the date of issue or last renewal of the policy.
631.15 History
History: 1975 c. 375;
1987 a. 247.
APPROVAL OF FORMS
631.20
631.20
Filing and approval of forms. 631.20(1)
(1)
Filing. No form subject to
s. 631.01 (1), except as exempted under
s. 631.01 (2) to
(5), may be used unless it has been filed with and approved by the commissioner and unless the insurer certifies that the form complies with
chs. 600 to
655 and rules promulgated under
chs. 600 to
655.It is deemed approved if it is not disapproved within 30 days after filing, or within a 30-day extension of that period ordered by the commissioner prior to the expiration of the first 30 days.
631.20(2)
(2) Grounds for disapproval. The commissioner may disapprove a form upon a finding:
631.20(2)(a)
(a) That it is inequitable, unfairly discriminatory, misleading, deceptive, obscure or encourages misrepresentation, including cases where the form:
631.20(2)(a)1.
1. Is misleading because its benefits are too restricted to achieve the purposes for which the policy is sold;
631.20(2)(a)2.
2. Contains provisions whose natural consequence is to obscure or lessen competition;
631.20(2)(a)4.
4. Is misleading, deceptive or obscure because of such physical aspects as format, typography, style, color, material or organization;
631.20(2)(b)
(b) That it provides benefits or contains other provisions that endanger the solidity of the insurer;
631.20(2)(c)
(c) That in the case of the policy, though not of riders and endorsements, it fails to provide the exact name of the insurer and the full address of its home office; or
631.20(2)(d)
(d) That it violates a statute or a rule promulgated by the commissioner, or is otherwise contrary to law.
631.20(3)
(3) Subsequent disapproval. Whenever the commissioner finds, after a hearing, that a form approved or deemed to be approved under
sub. (1) would be disapproved under
sub. (2) if newly filed, the commissioner may order that on or before a date not less than 30 nor more than 90 days after the order the use of the form shall be discontinued or appropriate changes shall be made.
631.20(4)
(4) Contents of order of disapproval. The commissioner's disapproval must be in writing and constitutes an order. It must state the reasons for disapproval sufficiently explicitly that the insurer is provided reasonable guidance in reformulating its proposals.
631.20(5)
(5) Explicit approval of certain clauses. General approval of a form under this section, or failure to disapprove, does not constitute approval of clauses specified in
s. 631.21.
631.20(6)
(6) Approved form which violates statute or rule. 631.20(6)(a)(a) The penalties under
s. 601.64 (3) to
(5) may not be imposed against an insurer for using a form that does not comply with a statute or rule if the statute or rule was in effect on the date the form was approved or deemed to be approved under
sub. (1).
631.20(6)(b)
(b) Use of a form that does not comply with a statute or rule which takes effect after the date the form was approved or deemed to be approved under
sub. (1) is a violation of the statute or rule, and the penalties under
s. 601.64 may be imposed against the insurer using the form.
631.21
631.21
Explicit approval required. 631.21(1)
(1)
Required approval. Despite the general approval of a form under
s. 631.20, the following clauses are not approved even if contained in the form unless the commissioner gives explicit approval to them:
631.21(1)(a)
(a)
Expeditious notice. Clauses requiring more expeditious notice than 1st class mail, as provided in
s. 631.81 (2).
631.21(1)(c)
(c)
Reinstatement fees. A schedule of reinstatement fees under
s. 632.74, if made a part of the policy. Such a schedule need not be included in the contract but may be given approval as a separate document specifically made applicable to particular classes of policies.
631.21(2)
(2) Effect of failure to obtain explicit approval. If an insurer fails to obtain explicit approval from the commissioner for the clauses under
sub. (1), the clauses shall be null and void.
631.21 History
History: 1975 c. 375;
1985 a. 280.
631.22
631.22
Consumer insurance policy readability. 631.22(1)
(1) In this section "consumer insurance policy" means a life, disability, property or casualty insurance policy, or a certificate or a substitute for a certificate for group life, disability, property or casualty insurance coverage, which is issued to a person for a personal, family or household purpose and a copy of which is customarily, in the insurance industry, delivered or is required by law, rule or agreement to be delivered to the person obtaining insurance coverage.
631.22(2)
(2) An insurer may provide a consumer insurance policy which is delivered to a person obtaining insurance coverage and is not exempt under
sub. (5) only if the consumer insurance policy is coherent, written in commonly understood language, legible, appropriately divided and captioned by its various sections and presented in a meaningful sequence. The commissioner shall promulgate rules establishing standards for the determination of compliance with this subsection.
631.22(3)
(3) This section does not apply to specific language or format required by state or federal law, rule or regulation.
631.22(4)
(4) This section applies only to consumer insurance policies delivered on or after the date which is 6 months after May 8, 1980 except the commissioner may provide by rule that this section will not apply to specific types of consumer insurance policies until a later date which is not later than the date which is 2 years after May 8, 1980 if the commissioner determines that delayed application is necessary to prevent an unreasonable burden upon insurers issuing those types of consumer insurance policies.
631.22(5)
(5) The commissioner may by rule exempt a type of consumer insurance policy from the application of this section if the commissioner finds that type of consumer insurance policy is generally understood by persons to whom it is delivered or that those persons are otherwise adequately protected.
631.22(6)
(6) A violation of this section does not void or render voidable any portion of an insurance policy and is not a defense to an action under the insurance policy.
631.22 History
History: 1979 c. 218.
631.23
631.23
Authorized clauses for insurance forms. 631.23(1)(1)
Promulgation of clauses. The commissioner may not promulgate mandatory uniform clauses that preclude an insurer from filing its own forms for approval under
s. 631.20; the commissioner may only disapprove such forms on the basis of the criteria stated in that section. Subject thereto, the commissioner may promulgate authorized clauses by rule upon a finding that:
631.23(1)(a)
(a) Price or coverage competition is ineffective because diversity in language or content makes comparison difficult;
631.23(1)(b)
(b) Provision of language, content or form of specific clauses is necessary to provide certainty of meaning of those clauses;
631.23(1)(c)
(c) Regulation of contract forms would be more effective or litigation would be substantially reduced if there were increased standardization of certain clauses; or
631.23(1)(d)
(d) Reasonable minimum standards of insurance protection are needed for policies to serve a useful purpose.
631.23(2)
(2) Degree of specificity. Any rule creating an authorized clause may prescribe that to be treated as an authorized clause there must be verbatim or substantial adherence to prescribed language, that certain standards or criteria must be met, or that certain drafting principles must be followed. The rules may also permit liberalization of prescribed language. If the proposed rule prescribed verbatim adherence, the commissioner shall make a finding that substantial adherence to the prescribed language is not sufficient and that liberalization of prescribed language will frustrate the purposes of the prescription. If an insurer uses authorized clauses as part of filed forms the commissioner may only disapprove those clauses under
s. 631.20 upon a finding that improper combination of clauses makes them violate the criteria of
s. 631.20.
631.23 History
History: 1975 c. 375,
421;
1979 c. 221.
631.24
631.24
Credit life and disability insurance. Section 631.20 does not apply to credit life and disability insurance forms which are subject to approval under
s. 424.209.
631.24 History
History: 1979 c. 102.
631.27
631.27
Rules of law as provisions of contracts. By rule, the commissioner may require an insurer to insert in a policy any rule of law stated in
chs. 600 to
646 and
655 that is applicable to the contents or interpretation of an insurance contract.
631.28
631.28
Notice of right to file complaint. 631.28(1)
(1)
Requirement to provide notice. Every insurer shall provide notice to its policyholders and its insureds of the right to file a complaint with the office in the manner prescribed by rule under
sub. (2).
631.28(2)
(2) Contents by rule. The commissioner shall promulgate rules specifying the contents of a notice that insurers must disseminate under
sub. (1), and when and in what manner the notice must be provided. The rules shall describe how a policyholder, insured or other person may make a complaint with the office about an insurer, an intermediary or other insurance matter. The rules may also specify the form, including the type size, in which insurers must present the notice.
631.28 History
History: 1991 a. 154.
SPECIFIC CLAUSES IN CONTRACTS
631.31
631.31
Clauses required to be on first page. 631.31(1)
(1)
List of clauses. The following clauses of insurance policies shall appear on the first page of the policy:
631.31(1)(b)
(b)
Several liability. Information that 2 or more insurers undertake only several liability, as required by
s. 631.41;
631.31(1)(e)
(e)
Right to return policy. The right to return a disability insurance policy under
s. 632.73, except that this clause may be conspicuously attached to the first page rather than printed on it.
631.31(2)
(2) Manner of display. Clauses listed in
sub. (1) shall be displayed conspicuously and separately from any other clauses.
631.31 History
History: 1975 c. 375;
1981 c. 218.
631.36
631.36
Termination of insurance contracts by insurers. 631.36(1)(a)(a)
General. Except as otherwise provided in this section or in other statutes or by rule under
par. (c), this section applies to all contracts of insurance based on forms which are subject to filing and approval under
s. 631.20 (1).
631.36(1)(b)
(b)
Contracts more favorable to policyholder. The contract may provide terms more favorable to policyholders than are required by this section.
631.36(1)(c)
(c)
Exemption by rule. The commissioner may by rule totally or partially exempt from this section classes or parts of classes of insurance contracts if the policyholders do not need protection against arbitrary or unannounced termination.
631.36(1)(d)
(d)
Other rights. The rights provided by this section are in addition to and do not prejudice any other rights the policyholder may have at common law or under other statutes.
631.36(1)(e)
(e)
Rescission or reformation. This section does not apply to the rescission or reformation of any insurance contract.
631.36(2)(a)(a)
Permissible grounds. Except as provided by
par. (c) and
sub. (3) and
s. 655.24 (2) (b), no insurance policy may be canceled by the insurer prior to the expiration of the agreed term except for failure to pay a premium when due or on grounds stated in the policy, which must be comprehended within one of the following classes:
631.36(2)(a)2.
2. Substantial change in the risk assumed, except to the extent that the insurer should reasonably have foreseen the change or contemplated the risk in writing the contract;
631.36(2)(a)3.
3. Substantial breaches of contractual duties, conditions or warranties; or
631.36(2)(a)4.
4. Attainment of the age specified as the terminal age for coverage, in which case the insurer may cancel by notice under
par. (b) accompanied by a tender of a proportional return of premium.
631.36(2)(b)
(b)
Notice. No cancellation under
par. (a) is effective until at least 10 days after the 1st class mailing or delivery of a written notice to the policyholder.
