632.24 Annotation
Recovery limitations applicable to an insured municipality likewise applied to its insurer, notwithstanding higher policy limits and s. 632.24. Gonzalez v. City of Franklin,
137 Wis. 2d 109,
430 N.W.2d 747 (1987).
632.24 Annotation
Insurers must plead and prove their policy limits prior to a verdict in order to restrict the judgment to the policy limits. Price v. Hart,
166 Wis. 2d 182,
480 N.W.2d 249 (Ct. App. 1991).
632.24 Annotation
This section does not apply to actions in which the principal on a bond under s. 344.36 causes injury. That section requires obtaining a judgment against the principal before an action may be brought against the surety. Vansguard v. Progressive Northern Insurance Co.
188 Wis. 2d 584,
525 N.W.2d 146 (Ct. App. 1994).
632.24 Annotation
There is neither a statutory nor a constitutional right to have all parties identified to a jury, but as a procedural rule, the court should in all cases apprise the jurors of the names of all the parties. Stoppleworth v. Refuse Hideway, Inc.
200 Wis. 2d 512,
546 N.W.2d 870 (Ct. App. 1996),
93-3182.
632.24 Annotation
A direct action against an insurer under this section is restricted by s. 631.01 to an insurer whose policy has been delivered or issued in Wisconsin. Kenison v. Wellington Insurance Co.
218 Wis. 2d 700,
582 N.W.2d 69 (Ct. App. 1998),
97-1758.
632.24 Annotation
The insured stands in privity with the insurer under this section. There is but one wrong and but one cause of action. When liability cannot be imposed upon one, none can be imposed upon the other. Plaintiff's cashing of the defendant's insurer's settlement check demonstrated an accord and satisfaction of claims against the insured although the insured had not been named in the action. Parsons v. American Family Insurance Company, 2007 WI App 211,
305 Wis. 2d 630,
740 N.W.2d 399,
06-2481.
632.24 Annotation
This section allows direct actions against a negligence insurer for negligence claims. It does not allow a plaintiff in a contract action to sue the defendant's insurer. Rogers v. Saunders, 2008 WI App 53,
309 Wis. 2d 238,
750 N.W.2d 477,
07-0306.
632.24 Annotation
This section statute does not speak to whether the timely answer of an insured denying liability may inure to the benefit of a defaulting insurance company so as to preclude a judgment by default against it for the plaintiff's damages. The timely answer of the codefendant insureds denying the liability of all defendants did not preclude default judgment against the insurer on the issue of liability and damages upon the insurer's acknowledged default. Estate of Otto v. Physicians Insurance Company of Wisconsin, Inc. 2008 WI 78,
311 Wis. 2d 84,
751 N.W.2d 805,
06-1566.
632.24 Annotation
The federal compulsory counterclaim rule precluded an action against an insurer under the state direct action statute when an action directly against the insured was barred by rule. Fagnan v. Great Central Ins. Co.
577 F.2d 418 (1978).
632.24 Annotation
A breach of fiduciary duty was negligence for purposes of Wisconsin's direct action and direct liability statutes. Federal Deposit Insurance Co. v. MGIC Indemnity Corp.
462 F. Supp. 759 (1978).
632.24 Annotation
An insurer's failure to join in an insured motorist's petition to remove the case to federal court necessitated a remand to state court. Padden v. Gallaher,
513 F. Supp. 770 (1981).
632.25
632.25
Limited effect of conditions in employer's liability policies. Any condition in an employer's liability policy requiring compliance by the insured with rules concerning the safety of persons shall be limited in its effect in such a way that in the event of breach by the insured the insurer shall nevertheless be responsible to the injured person under
s. 632.24 as if the condition has not been breached, but shall be subrogated to the injured person's claim against the insured and be entitled to reimbursement by the latter.
632.25 History
History: 1975 c. 375.
632.25 Annotation
"Condition" as used in this section does not refer to exclusion. Bortz v. Merrimac Mutual Insurance Co.
92 Wis. 2d 865,
286 N.W.2d 16 (Ct. App. 1979).
632.26
632.26
Notice provisions. 632.26(1)(1)
Required provisions. Every liability insurance policy shall provide:
632.26(1)(a)
(a) That notice given by or on behalf of the insured to any authorized agent of the insurer within this state, with particulars sufficient to identify the insured, is notice to the insurer.
632.26(1)(b)
(b) That failure to give any notice required by the policy within the time specified does not invalidate a claim made by the insured if the insured shows that it was not reasonably possible to give the notice within the prescribed time and that notice was given as soon as reasonably possible.
632.26(2)
(2) Effect of failure to give notice. Failure to give notice as required by the policy as modified by
sub. (1) (b) does not bar liability under the policy if the insurer was not prejudiced by the failure, but the risk of nonpersuasion is upon the person claiming there was no prejudice.
632.26 History
History: 1979 c. 102.
632.26 Annotation
Legislative Council Note, 1979: Subsection (1) is former s. 632.32 (1), altered in 2 ways: (1) to extend its coverage to all liability policies; and (2) to change "may" to "shall". The subsection is divided into 2 paragraphs for clarity.
632.26 Annotation
The first change would strengthen the law. It is entirely new and seems a desirable extension.
632.26 Annotation
The second change corrects an error. The word "shall" was used in the fourth draft of the bill that ultimately became ch. 375, laws of 1975, and was not changed in the addendum to the fourth draft, dated July 14, 1975. Those documents went to the insurance laws revision committee and then to the legislative council for action. Nothing appears in the minutes of the committee's meeting of July 14, 1975 to indicate that a change was made. But in LRB-6218/1 of 1975, "may" appears instead of "shall". That error, which was probably inadvertent and the source of which we have not been able to trace, was carried on into the final enactment.
632.26 Annotation
Sub. (2) continues the second sentence of former s. 632.34 (4). Shifting it to s. 632.26, which is applicable to all liability insurance, broadens its application, but that seems desirable. The term "burden of proof" is changed to "risk of nonpersuasion" to tighten up the meaning. "Burden of proof" is a broad term that comprehends 2 separate concepts: (1) the burden of going forward with the evidence and (2) the burden of persuading the trier of fact, better termed the "risk of nonpersuasion". See McCormick, Evidence, (2nd ed.), at 784 n. 4 (1972). The statute is concerned with determining who wins when the totality of evidence is inconclusive, not with the burden of going forward, which ought to be settled on the basis of general principles. Indeed, since the insurer will have best (or the only) access to information about prejudice, it may be quite unfair to put the burden of going forward on the claimant.
632.26 Annotation
Subs. (1) (b) and (2) are related. The first is a required provision in the policy. The 2nd is a rule of law. It is preferable not to go too far in inserting excuses into the policy. Sub. (1) (b) encourages the insured not to give up automatically if notice is not timely given, but insertion of sub. (2) into the policy would arguably encourage an unduly long delay that might prejudice both parties. [Bill 146-S]
632.26 Annotation
When the insurer denied coverage within the time that the insured could have submitted her proofs in response to the insurer's request for more information, the insurer waived the defense of lack of notice. Ehlers v. Colonial Penn Insurance Co.
81 Wis. 2d 64,
259 N.W.2d 718 (1977).
632.26 Annotation
The failure of policyholders to give notice to an underinsurer of a settlement between the insured and the tortfeasor does not bar underinsured motorist coverage in the absence of prejudice to the insurer. There is a rebuttable presumption of prejudice when there is a lack of notice, with the burden on the insured to prove by the greater weight of the evidence that the insurer was not prejudiced. Ranes v. American Family Mutual Insurance Co.
219 Wis. 2d 49,
580 N.W.2d 197 (1998),
97-0441.
AUTOMOBILE AND MOTOR VEHICLE INSURANCE
632.32
632.32
Provisions of motor vehicle insurance policies. 632.32(1)(1)
Scope. Except as otherwise provided, this section applies to every policy of insurance issued or delivered in this state against the insured's liability for loss or damage resulting from accident caused by any motor vehicle, whether the loss or damage is to property or to a person.
632.32(2)(am)
(am) "Medical payments coverage" means coverage to indemnify for medical payments or chiropractic payments or both for the protection of all persons using the insured motor vehicle from losses resulting from bodily injury or death.
632.32(2)(at)
(at) "Motor vehicle" means a self-propelled land motor vehicle designed for travel on public roads and subject to motor vehicle registration under
ch. 341. A trailer or semitrailer that is designed for use with and connected to a motor vehicle shall be considered a single unit with the motor vehicle. "Motor vehicle" does not include farm tractors, well drillers, road machinery, or snowmobiles.
632.32(2)(b)
(b) "Motor vehicle handler" means any of the following:
632.32(2)(b)3.
3. A repair shop, service station, storage garage or public parking place.
632.32(2)(be)
(be) "Owned motor vehicle" means a motor vehicle that is owned by the insured or that is leased by the insured for a term of 6 months or longer.
632.32(2)(cm)
(cm) "Umbrella or excess liability policy" means an insurance contract providing at least $1,000,000 of liability coverage per person or per occurrence in excess of certain required underlying liability insurance coverage or a specified amount of self-insured retention.
632.32(2)(d)
(d) "Underinsured motorist coverage" means coverage for the protection of persons insured under that coverage who are legally entitled to recover damages for bodily injury, death, sickness, or disease from owners or operators of underinsured motor vehicles.
632.32(2)(e)
(e) "Underinsured motor vehicle" means a motor vehicle to which all of the following apply:
632.32(2)(e)1.
1. The motor vehicle is involved in an accident with a person who has underinsured motorist coverage.
632.32(2)(e)2.
2. At the time of the accident, a bodily injury liability insurance policy applies to the motor vehicle or the owner or operator of the motor vehicle has furnished proof of financial responsibility for the future under
subch. III of ch. 344 and it is in effect or is a self-insurer under another applicable motor vehicle law.
632.32(2)(e)3.
3. The limits under the bodily injury liability insurance policy or with respect to the proof of financial responsibility or self-insurance are less than the amount needed to fully compensate the insured for his or her damages.
632.32(2)(f)
(f) "Uninsured motorist coverage" means coverage for the protection of persons insured under that coverage who are legally entitled to recover damages for bodily injury, death, sickness, or disease from owners or operators of uninsured motor vehicles.
632.32(2)(g)
(g) "Uninsured motor vehicle" means a motor vehicle that is involved in an accident with a person who has uninsured motorist coverage and with respect to which, at the time of the accident, a bodily injury liability insurance policy is not in effect and the owner or operator has not furnished proof of financial responsibility for the future under
subch. III of ch. 344 and is not a self-insurer under any other applicable motor vehicle law. "Uninsured motor vehicle" also includes any of the following motor vehicles involved in an accident with a person who has uninsured motorist coverage:
632.32(2)(g)1.
1. An insured motor vehicle, or a motor vehicle with respect to which the owner or operator is a self-insurer under any applicable motor vehicle law, if before or after the accident the liability insurer of the motor vehicle, or the self-insurer, is declared insolvent by a court of competent jurisdiction.
632.32(2)(g)2.
2. Except as provided in
subd. 3., an unidentified motor vehicle, provided that an independent 3rd party provides evidence in support of the unidentified motor vehicle's involvement in the accident.
632.32(2)(g)3.
3. An unidentified motor vehicle involved in a hit-and-run accident with the person.
632.32(2)(h)
(h) "Using" includes driving, operating, manipulating, riding in and any other use.
632.32(3)
(3) Required provisions. Except as provided in
sub. (5), every policy subject to this section issued to an owner shall provide that:
632.32(3)(a)
(a) Coverage provided to the named insured applies in the same manner and under the same provisions to any person using any motor vehicle described in the policy when the use is for purposes and in the manner described in the policy.
632.32(3)(b)
(b) Coverage extends to any person legally responsible for the use of the motor vehicle.
632.32(4)
(4) Required uninsured motorist, underinsured motorist, and medical payments coverages. 632.32(4)(a)(a) Except as provided in
par. (d), every policy of insurance subject to this section that insures with respect to any owned motor vehicle registered or principally garaged in this state against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance, or use of a motor vehicle shall contain therein or supplemental thereto provisions for all of the following coverages:
632.32(4)(a)1.
1. Excluding a policy written by a town mutual organized under
ch. 612, uninsured motorist coverage, in limits of at least $100,000 per person and $300,000 per accident.
632.32(4)(a)2m.
2m. Excluding a policy written by a town mutual organized under
ch. 612, underinsured motorist coverage, in limits of at least $100,000 per person and $300,000 per accident.
632.32(4)(a)3m.
3m. Medical payments coverage, in the amount of at least $10,000 per person. Coverage written under this subdivision may be excess coverage over any other source of reimbursement to which the insured person has a legal right.
632.32(4)(bc)
(bc) Notwithstanding
par. (a) 3m., the named insured may reject medical payments coverage. If the named insured rejects the coverage, the coverage need not be provided in a subsequent renewal policy issued by the same insurer unless the insured requests it in writing.
632.32(4)(c)
(c) Unless an insurer waives the right to subrogation, insurers making payment under any of the coverages under this subsection shall, to the extent of the payment, be subrogated to the rights of their insureds.
632.32(4)(d)
(d) This subsection does not apply to umbrella or excess liability policies, which are subject to
sub. (4r).
632.32 Cross-reference
Cross-reference: See also s.
Ins 6.77, Wis. adm. code.
632.32(4r)
(4r) Required written offers of uninsured motorist and underinsured motorist coverages for umbrella or excess liability policies. 632.32(4r)(a)(a) An insurer writing umbrella or excess liability policies that insure with respect to an owned motor vehicle registered or principally garaged in this state against loss resulting from liability imposed by law for bodily injury or death suffered by a person arising out of the ownership, maintenance, or use of a motor vehicle shall provide written offers of uninsured motorist coverage and underinsured motorist coverage, which offers shall include a brief description of the coverage offered. An insurer is required to provide the offers required under this subsection only one time with respect to any policy in the manner provided in
par. (b).
632.32(4r)(b)1.1. Each application for an umbrella or excess liability policy issued on or after November 1, 2009, shall contain a written offer of uninsured motorist coverage and a written offer of underinsured motorist coverage.
632.32(4r)(b)2.
2. For umbrella or excess liability policies that are in effect on November 1, 2009, the insurer shall provide a written offer of uninsured motorist coverage to the named insureds under each policy that does not include uninsured motorist coverage and a written offer of underinsured motorist coverage to the named insureds under each policy that does not include underinsured motorist coverage. The insurer shall provide an offer under this subdivision in conjunction with the notice of the first renewal of the policy occurring after November 1, 2009.
632.32(4r)(c)
(c) An applicant or a named insured may reject one or both of the coverages offered, but must do so in writing. If the applicant or named insured rejects either of the coverages offered, the insurer is not required to provide the rejected coverage under the policy at renewal by that insurer unless an insured under the policy subsequently requests the rejected coverage in writing. The action of one named insured to reject or request coverage applies to all persons insured under the policy.
632.32(4r)(d)
(d) If an umbrella or excess liability policy that was issued on or after November 1, 2009, or an umbrella or excess liability policy that was in effect on, but renewed after, November 1, 2009, includes neither uninsured motorist coverage nor underinsured motorist coverage, or only one of the coverages, and the insurer did not provide a written offer required under
par. (b) 1. or
2. with respect to the coverage or coverages not included, on the request of the insured the court shall reform the policy to include the coverage or coverages not included and for which the insurer did not provide a written offer, with the same limits as the liability coverage limits under the policy.
632.32(4r)(e)
(e) This subsection does not apply to a town mutual organized under
ch. 612.
632.32 Cross-reference
Cross-reference: See also s.
Ins 6.77, Wis. adm. code.
632.32(5)(a)(a) A policy may limit coverage to use that is with the permission of the named insured or, if the insured is an individual, to use that is with the permission of the named insured or an adult member of that insured's household other than a chauffeur or domestic servant. The permission is effective even if it violates
s. 343.45 (2) and even if the use is not authorized by law.
632.32(5)(b)
(b) If the policy is issued to anyone other than a motor vehicle handler, it may limit the coverage afforded to a motor vehicle handler or its officers, agents or employees to the limits under
s. 344.01 (2) (d) and to instances when there is no other valid and collectible insurance with at least those limits whether the other insurance is primary, excess or contingent.
632.32(5)(c)
(c) If the policy is issued to a motor vehicle handler, it may restrict coverage afforded to anyone other than the motor vehicle handler or its officers, agents or employees to the limits under
s. 344.01 (2) (d) and to instances when there is no other valid and collectible insurance with at least those limits whether the other insurance is primary, excess or contingent.
632.32(5)(d)
(d) If a motor vehicle covered by the policy is sold or transferred, the purchaser or transferee is not an additional insured unless the consent of the insurer is endorsed on the policy.
632.32(5)(e)
(e) A policy may provide for exclusions not prohibited by
sub. (6) or other applicable law. Such exclusions are effective even if incidentally to their main purpose they exclude persons, uses or coverages that could not be directly excluded under
sub. (6) (b).
632.32(5)(j)
(j) A policy may provide that any coverage under the policy does not apply to a loss resulting from the use of a motor vehicle that meets all of the following conditions:
632.32(5)(j)1.
1. Is owned by the named insured, or is owned by the named insured's spouse or a relative of the named insured if the spouse or relative resides in the same household as the named insured.
632.32(5)(j)2.
2. Is not described in the policy under which the claim is made.
632.32(5)(j)3.
3. Is not covered under the terms of the policy as a newly acquired or replacement motor vehicle.
632.32(6)(a)(a) No policy issued to a motor vehicle handler may exclude coverage upon any of its officers, agents or employees when any of them are using motor vehicles owned by customers doing business with the motor vehicle handler.
632.32(6)(b)
(b) No policy may exclude from the coverage afforded or benefits provided:
632.32(6)(b)1.
1. Persons related by blood, marriage or adoption to the insured.
632.32(6)(b)2.a.a. Any person who is a named insured or passenger in or on the insured vehicle, with respect to bodily injury, sickness or disease, including death resulting therefrom, to that person.
