646.11(5)
(5) Immunity. No cause of action of any nature may arise against and no liability may be imposed upon the fund or its agents, employees, directors or contributor insurers, or the commissioner or the commissioner's agents, employees or representatives, for any act or omission by any of them in the performance of their powers and duties under this chapter.
646.12
646.12
Administration of the fund. 646.12(1)(a)(a)
Members. The fund shall be administered by a board of directors which shall consist of not fewer than 7 nor more than 14 members. The attorney general, the state treasurer and the commissioner are members with full voting rights. Other members shall be chosen from representatives of insurers subject to this chapter under procedures specified by the commissioner by rule, provided that one member is a representative of a service insurance corporation. The rule may provide that, instead of natural persons, specific insurers or associations of insurers may be selected as members of the board and may act through any duly authorized representative.
646.12(1)(b)
(b)
Chairperson. The person to chair the board shall be elected by the members of the board under a rule promulgated by the commissioner.
646.12(2)
(2) General powers and duties. The board shall:
646.12(2)(a)
(a) Subject to the commissioner's power to promulgate rules under
sub. (1), adopt rules for the administration of this chapter, including delegation of any part of its powers and its own procedures.
646.12(2)(b)
(b) Create standing or special committees as needed. A minority of the members of any committee may be persons not members of the board.
646.12(2)(c)
(c) Delegate to the committees any of its powers and duties under this chapter, subject to review and reconsideration by the board.
646.12(2)(d)
(d) Employ or retain the personnel necessary to carry out its duties and set compensation for the personnel, sue or be sued, make contracts and borrow money necessary to carry out its duties in the most efficient way, including money with which to pay claims under
s. 646.31 or to continue coverage under
s. 646.35. The board may offer as security for such loans its claims against the liquidator or its power to levy assessments under this chapter. Personnel employed under this paragraph are not employees of the state and are not subject to
s. 20.922 or
ch. 230.
646.12(2)(e)
(e) Advise and make recommendations to the commissioner on any matter related to the possible insolvency of an insurer covered by this chapter, and respond to any reasonable questions presented by the commissioner. Information, recommendations and advice under this subsection are privileged and confidential and are not open to public inspection under
s. 19.35 (1).
646.12(2)(f)1.1. Keep records of all meetings of the fund and of its subcommittees that involve discussions of the activities of the fund in carrying out its powers and duties under this chapter.
646.12(2)(f)2.
2. Keep confidential the records under
subd. 1. pertaining to specific liquidation proceedings involving an insurer until the termination of the liquidation proceedings or until sooner ordered to make the records public by a court.
646.12(2)(f)3.
3. Keep confidential the records under
subd. 1. pertaining to specific rehabilitation proceedings involving an insurer unless ordered to make the records public by a court.
646.12(2)(g)
(g) Negotiate and contract with any liquidator to achieve the purposes of this chapter.
646.12(2)(h)
(h) Perform other acts necessary to achieve the purposes of this chapter.
646.12(3)
(3) Compensation. Members of the board and other committee members shall receive no compensation for services but may receive reimbursement for all reasonable and necessary expenses incurred in the performance of their respective duties as directors or as committee members.
646.12(4)
(4) Other powers. The board may join an organization consisting of one or more entities of other states performing comparable functions, in order to assist the board in carrying out its powers and duties under this chapter and otherwise further the purposes of this chapter.
646.13
646.13
Special duties and powers of the board related to loss claims. 646.13(1)(a)
(a) Establish procedures and acceptable forms of proof for eligible claims, which shall correspond as closely as practicable with the corresponding rules under
ch. 645.
646.13(1)(b)
(b) Stand in the position of the insurer in the investigation, compromise, settlement, denial and payment of claims under
s. 646.31 and the defense of 3rd party claims against insureds, subject to the limitations of
s. 645.43. The board shall consult and cooperate with the liquidator in carrying out these duties.
646.13(2)(a)
(a) Review settlements, releases and judgments to which the insurer or its insureds were parties to determine the extent to which they may be properly contested.
646.13(2)(b)
(b) Exercise with respect to loss claims the powers that the liquidator has with respect to other claims under
ch. 645.
646.13(2)(c)
(c) With respect to any action against an insurer which is in liquidation, exercise the powers of the liquidator under
s. 645.49 (1).
646.13(2)(d)
(d) Have standing to appear in any liquidation proceedings in this state involving an insurer in liquidation.
646.13(2)(e)
(e) Pursue salvage and subrogation with respect to paid covered claim obligations and retain any amounts recovered.
646.13(2)(f)
(f) Appoint and direct legal counsel for the defense of covered claims under insurance policies.
646.13(3)
(3) No duty or liability. The board has no duty or liability with respect to any claim filed as follows:
646.13(3)(a)
(a) With the liquidator under
s. 645.61 after the date for filing specified by the liquidator under
s. 645.47 (2), unless the liquidator determines that the claim is considered to have been timely filed under
s. 645.61 (2) and the claim participates fully in every distribution to the same extent as other timely filed claims in the same class.
646.13(3)(b)
(b) With a liquidator or court under the laws of any other state after the date for filing specified by the liquidator or court, unless the liquidator or court determines that the claim is considered to have been timely filed under a law substantially similar to
s. 645.61 (2) and the claim participates fully in every distribution to the same extent as other timely filed claims in the same class.
646.13(3)(c)
(c) Except for claims under life insurance policies, annuities and noncancelable or guaranteed renewable disability insurance policies and except for claims determined to be excused late filings as provided in
pars. (a) and
(b), with a liquidator or court after the earlier of the following:
646.13(3)(c)1.
1. Eighteen months after the order of liquidation is entered.
646.13(3)(c)2.
2. The final date for filing specified by the liquidator or court.
646.13(4)
(4) When duty to defend terminates. Any obligation of the board to defend an insured ceases upon the board's payment, by settlement releasing the insured or on a judgment, of an amount equal to the lesser of the board's covered claim obligation limit or the applicable policy limit, subject to any express policy terms regarding tender of limits.
646.15
646.15
Proceedings involving nondomestic insurers. 646.15(1)(a)(a) If a nondomestic insurer is in liquidation, the board may apply to the circuit court for Dane County for, and the court may grant, restraining orders, temporary and permanent injunctions, and other orders considered necessary and proper to prevent any of the following:
646.15(1)(a)1.
1. Interference with the board or with its administrative proceedings.
646.15(1)(a)2.
2. The institution or further prosecution of any action or proceeding involving the insurer or in which the board is obligated to defend a party.
646.15(1)(a)3.
3. The obtaining of a preference, judgment, garnishment or lien against the insurer or its assets.
646.15(1)(a)4.
4. Any other threatened or contemplated action that might prejudice the rights of policyholders or the administration of the liquidation or board proceedings.
646.15(1)(b)
(b) Upon granting an application under
par. (a), the court may retain jurisdiction of any further proceeding or relief, as the court considers necessary and proper, involving the insurer.
646.15(2)
(2) Exclusive proceedings. A court of this state does not have jurisdiction to entertain, hear or determine a proceeding or to grant relief if the proceeding or relief involves or is related to a nondomestic insurer which is in liquidation unless the court is so authorized under this chapter or
ch. 645.
646.15 History
History: 1987 a. 325;
1999 a. 30.
646.21
646.21
Custody and investment of assets. 646.21(1)
(1)
Custody. Except as provided in
sub. (2), the board controls the assets of the fund. The board shall select regulated financial institutions in this state which receive deposits in which to establish and maintain accounts for assets needed on a current basis. If practicable, the accounts shall earn interest.
646.21(2)
(2) Investment of assets. The board may request that assets of the fund not needed currently be invested by the investment board under
s. 25.17. If so requested, the investment board shall invest those assets in investments with maturities and liquidity appropriate to the probable needs of the fund for money to perform its duties. All income attributable to the investments shall be credited to the fund, and both income and principal shall be transferred to the board of the fund on request of the board. Assets held by the board of the fund shall be invested in a similar manner.
646.21 History
History: 1979 c. 109;
1983 a. 120.
CLAIMS PROCEDURES
646.31
646.31
Eligible claims. 646.31(1)(1)
Conditions of eligibility. A claim is not eligible for payment from the fund unless it is an unpaid claim for a loss insured under the policy or annuity and all of the following conditions are met:
646.31(1)(a)
(a)
Issued by authorized insurer. The claim arises out of an insurance policy or annuity issued by an insurer which was authorized to do business in this state either at the time the policy or annuity was issued or when the insured event occurred, and against which an order of liquidation, which is not stayed, has been entered by a court of competent jurisdiction in the insurer's domiciliary state.
646.31(1)(b)
(b)
Assessability of insurer. The claim arises out of business not exempt from assessment under
s. 646.01 (1).
646.31(1)(c)
(c)
Contact with state. The claim is a member of one of the classes of claims under
sub. (2).
646.31(1)(cm)
(cm)
Termination of coverage. Except for claims under life insurance policies, annuities or noncancelable or guaranteed renewable disability insurance policies, the claim arises within 30 days after the order of liquidation is entered or before any of the following occur:
646.31(1)(cm)1.
1. The policy expires, if the expiration date is less than 30 days after the order of liquidation is entered.
646.31(1)(cm)2.
2. The insured replaces or cancels the policy, if either action is taken within 30 days after the order of liquidation is entered.
646.31(1)(d)
(d)
Exceptions. The claim is not any of the following:
646.31(1)(d)9.
9. Made for health care costs, as defined in
s. 609.01 (1j), for which an enrollee, as defined in
s. 609.01 (1d), or policyholder of a health maintenance organization is not liable for any reason.
646.31(2)
(2) Classes of claims to be paid. No claim may be paid under this chapter unless the claim is in one of the following classes:
646.31(2)(a)1.1. The claim of a policyholder, including a ceding assessable domestic insurer which is organized under
ch. 612 and a domestic insurer which is a bona fide policyholder of the insurer in liquidation, who at the time of the insured event or of the liquidation order was a resident of this state.
646.31(2)(a)2.
2. Except for a claim of a beneficiary, assignee or payee under a life or disability insurance policy or annuity contract, the claim of an insured, including a certificate holder, under a policy or annuity who at the time of the insured event or of the liquidation order was a resident of this state.
646.31(2)(b)1.1. Except with regard to claims under contracts that are held by residents of a state that does not provide substantially equivalent coverage with regard to contracts of residents of this state, the claim is made under a life or disability insurance policy or annuity contract subject to this section and issued by a domestic insurer, whether or not the claimant is a resident of this state.
646.31(2)(b)2.
2. The claim is made under a life or disability insurance policy or annuity contract subject to this section and issued by a domestic insurer if all of the following conditions are met:
646.31(2)(b)2.a.
a. The claimant is a resident of another state that provides coverage similar to the coverage provided under this chapter but does not provide coverage for the claimant.
646.31(2)(b)2.b.
b. The insurer never held a license or certificate of authority in the state in which the claimant resides.
646.31(2)(b)3.
3. The claim is made before January 1, 1990, under a life or disability insurance policy or annuity contract subject to this section and issued by a domestic insurer if all of the following conditions are met:
646.31(2)(b)3.a.
a. The claimant was a resident of this state when the policy or contract was issued.
646.31(2)(b)3.b.
b. The claimant is a resident of a state which does not provide coverage similar to the coverage provided under this chapter.
646.31(2)(c)
(c)
Owners of property interests. The first-party claim of a person having an insurable interest in or related to property with a permanent location in this state at the time of the insured event.
646.31(2)(d)
(d)
Third party claimants. A claim under a liability or workers' compensation insurance policy, if either the insured or the 3rd party claimant was a resident of this state at the time of the insured event.
646.31(2)(e)
(e)
Assignees. The claim of a direct or indirect resident assignee, other than an insurer, of a person who except for the assignment could have claimed under
par. (a),
(b),
(c) or
(d).
