Chapter 631

631.81 Annotation An insurer is prejudiced by late notice when it has been denied the opportunity to have input into how the underlying claim is being defended. An insured may not assume that if its insurer had been given the opportunity to make a timely investigation, it would have produced the same result as that produced by the insured’s own investigation or that any discovery that the insurer would have conducted would parallel that already conducted by the insured. Phoenix Contractors, Inc. v. Affiliated Capital Corp., 2004 WI App 103, 273 Wis. 2d 736, 681 N.W.2d 310, 03-2259.

631.81 Annotation Wisconsin’s notice-prejudice statutes, this section and s. 632.26, do not supersede the reporting requirement specific to claims-made-and-reported policies. Anderson v. Aul, 2015 WI 19, 361 Wis. 2d 63, 862 N.W.2d 304, 13-0500.

631.81 Annotation The Federal Employee Retirement Income Security Act (ERISA) preempts state law related to any covered employee benefit plan, but does not preempt state regulation of insurance. This section regulates insurance and is not preempted. Bogusewski v. Life Insurance Co. of North America, 977 F. Supp. 1357 (1997).

631.83 631.83 Limitation of actions.

631.83(1) (1) Statutory periods of limitation.

631.83(1)(a) (a) Fire insurance. An action on a fire insurance policy must be commenced within 12 months after the inception of the loss. This rule also applies to riders or endorsements attached to a fire insurance policy covering loss or damage to property or to the use of or income from property from any cause, and to separate windstorm or hail insurance policies.

631.83(1)(b) (b) Disability insurance. An action on disability insurance coverage must be commenced within 3 years from the time written proof of loss is required to be furnished.

631.83(1)(c) (c) Life claims based on absence of insured. Sections 813.22 to 813.34 apply to life insurance actions based on death in which absence is relied upon as evidence of death.

631.83(1)(d) (d) Other. Except as provided in this subsection or elsewhere in chs. 600 to 646 and 655, s. 893.43 applies to actions on insurance policies.

631.83(2) (2) General law applicable to limitation of actions. Except for the prescription of time periods under sub. (1) or elsewhere in chs. 600 to 646 and 655, the general law applicable to limitation of actions as modified by ch. 893 applies to actions on insurance policies.

631.83(3) (3) Prohibited clauses of policies. No insurance policy may:

631.83(3)(a) (a) Shorten periods of limitation. Limit the time for beginning an action on the policy to a time less than that authorized by the statutes;

631.83(3)(b) (b) Limit jurisdiction. Prescribe in what court action may be brought thereon; or

631.83(3)(c) (c) Proscribe action. Provide that no action may be brought.

631.83(4) (4) Minimum waiting period for action. No action may be brought against the insurer on an insurance policy to compel payment thereunder until at least 60 days after proof of loss has been furnished as required by the policy or such proof of loss has been waived, or the insurer has denied full payment, whichever is earlier. This subsection does not apply in any case in which the verified complaint alleges facts that would establish prejudice to the complainant by reason of such delay, other than the delay itself.

631.83(5) (5) Tolling of period of limitation. The period of limitation is tolled during the period in which the parties conducted an appraisal or arbitration procedure prescribed by the insurance policy or by law or agreed to by the parties.

631.83 History History: 1975 c. 375; 1979 c. 89, 102; 1983 a. 192; 1987 a. 247; 1989 a. 187 s. 29.

631.83 Annotation The term “fire insurance” covers indemnity insurance for losses to property caused by many perils other than fire. Villa Clement, Inc. v. National Union Fire Insurance Co. of Pittsburgh, 120 Wis. 2d 140, 353 N.W.2d 369 (Ct. App. 1984).

631.83 Annotation Action by mortgagees of insured property against the insurer for paying the policy proceeds to the insured despite knowledge of the mortgagee’s interest was not on the policy and was not barred by sub. (1) (a). Picus v. Copus, 127 Wis. 2d 359, 379 N.W.2d 341 (Ct. App. 1985).

631.83 Annotation The s. 893.57 statute of limitations governs the intentional tort of bad faith by an insurer. Warmka v. Hartland Cicero Mutual Insurance Co., 136 Wis. 2d 31, 400 N.W.2d 923 (1987).

631.83 Annotation “Inception of the loss” in sub. (1) (a) means the date on which the loss occurs, not the discovery date. Borgen v. Economy Preferred Insurance Co., 176 Wis. 2d 498, 500 N.W.2d 419 (Ct. App. 1993).

631.83 Annotation The failure of policyholders to give notice to an underinsurer of a settlement between the insured and the tortfeasor did 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.

631.83 Annotation Sub. (2) clearly and unambiguously excepts the time limitations for fire insurance claims from the application of s. 893.12. Wieting Funeral Home of Chilton, Inc. v. Meridian Mutual Insurance Co., 2004 WI App 218, 277 Wis. 2d 274, 690 N.W.2d 442, 04-0461.

631.83 Annotation An “agreement” by the parties to engage in an appraisal procedure under sub. (5) requires something more than a mere agreement to meet and discuss a dispute between the parties. Wieting Funeral Home of Chilton, Inc. v. Meridian Mutual Insurance Co., 2004 WI App 218, 277 Wis. 2d 274, 690 N.W.2d 442, 04-0461.

631.83 Annotation The key word in sub. (1) (a) is not loss, but inception. In a claim arising from damage to corn yield resulting from vandalism to a corn planter, the inception of that loss was the moment overfertilized seeds were planted with the vandalized corn planter. Bronsteatter & Sons, Inc. v. American Growers Insurance Co., 2005 WI App 192, 286 Wis. 2d 782, 703 N.W.2d 757, 05-0115.

631.83 Annotation Because all of the statutory language surrounding sub. (5), including the statute regulating arbitration and appraisals, applies only to first-party claims, sub. (5) tolls the period of limitation only as to claims by insureds against their insurer, not to claims by third parties against a tortfeasor’s insurer. Thom v. OneBeacon Insurance Co., 2007 WI App 123, 300 Wis. 2d 607, 731 N.W.2d 657, 06-1617.

631.85 631.85 Appraisal or arbitration. An insurance policy may contain provisions for independent appraisal and compulsory arbitration, subject to the provisions of s. 631.20. If an approved policy provides for application to a court of record for the appointment of a disinterested appraiser, arbitrator, or umpire, any court of record of this state except the court of appeals or the supreme court may be requested to make an appointment. Upon appropriate request, the court shall make the appointment promptly. This section does not apply to a surplus lines insurance form issued under s. 618.41 before, on, or after April 20, 2012.

631.85 History History: 1975 c. 375; 1977 c. 187; 2011 a. 224.

631.85 Annotation Although s. 631.20 generally refers to forms, its procedure for approval of forms is applicable to arbitration clauses under this section. An arbitration clause not approved under this section is per se invalid. Appleton Papers, Inc. v. Home Indemnity Co., 2000 WI App 104, 235 Wis. 2d 39, 612 N.W.2d 760, 99-1567.

631.89 631.89 Restrictions on use of genetic test results.

631.89(1) (1) In this section, “genetic test” means a test using deoxyribonucleic acid extracted from an individual’s cells in order to determine the presence of a genetic disease or disorder or the individual’s predisposition for a particular genetic disease or disorder.

631.89(2) (2) An insurer, the state with respect to a self-insured health plan, or a county, city, village or school board that provides health care services for individuals on a self-insured basis, may not do any of the following:

631.89(2)(a) (a) Require or request directly or indirectly any individual or a member of the individual’s family to obtain a genetic test.

631.89(2)(b) (b) Require or request directly or indirectly any individual to reveal whether the individual or a member of the individual’s family has obtained a genetic test or what the results of the test, if obtained by the individual or a member of the individual’s family, were.

631.89(2)(bm) (bm) Require or request directly or indirectly a health care provider, as defined in s. 146.81 (1) (a) to (p), who is or may be providing or who has or may have provided health care services to an individual to reveal whether the individual or a member of the individual’s family has obtained a genetic test or what the results of the test, if obtained by the individual or a member of the individual’s family, were.

631.89(2)(c) (c) Condition the provision of insurance coverage or health care benefits on whether an individual or a member of the individual’s family has obtained a genetic test or what the results of the test, if obtained by the individual or a member of the individual’s family, were.

631.89(2)(d) (d) Consider in the determination of rates or any other aspect of insurance coverage or health care benefits provided to an individual whether an individual or a member of the individual’s family has obtained a genetic test or what the results of the test, if obtained by the individual or a member of the individual’s family, were.

631.89(3) (3) 

631.89(3)(a) (a) Subsection (2) does not apply to an insurer writing life insurance coverage or income continuation insurance coverage.

631.89(3)(b) (b) An insurer writing life insurance coverage or income continuation insurance coverage that obtains information under sub. (2) (a) or (b) may not do any of the following:

631.89(3)(b)1. 1. Use the information contrary to sub. (2) (c) or (d) in writing a type of insurance coverage other than life or income continuation for the individual or a member of the individual’s family.

631.89(3)(b)2. 2. Provide for rates or any other aspect of coverage that is not reasonably related to the risk involved.

631.89 History History: 1991 a. 269; 1997 a. 74; 2009 a. 28.

631.90 631.90 Restrictions on use of tests for HIV.

631.90(1) (1) In this section, “HIV test” has the meaning given in s. 252.01 (2m).

631.90(2) (2) With regard to policies issued or renewed on and after July 20, 1985, an insurer may not do any of the following:

631.90(2)(a) (a) Require or request directly or indirectly any individual to reveal whether the individual has obtained an HIV test or what the results of this test, if obtained by the individual, were.

631.90(2)(b) (b) Condition the provision of insurance coverage on whether an individual has obtained an HIV test or what the results of this test, if obtained by the individual, were.

631.90(2)(c) (c) Consider in the determination of rates or any other aspect of insurance coverage provided to an individual whether an individual has obtained an HIV test or what the results of this test, if obtained by the individual, were.

631.90(3) (3) 

631.90(3)(a) (a) Subsection (2) does not apply with regard to an HIV test for use in the underwriting of individual life, accident and health insurance policies that the commissioner finds and designates by rule as sufficiently reliable for use in the underwriting of individual life, accident and health insurance policies.

631.90(3)(b) (b) Paragraph (a) does not authorize the use of an HIV test to discriminate in violation of s. 628.34 (3).

631.90 History History: 1985 a. 29, 73; 1987 a. 70 ss. 34, 36; 1989 a. 201 ss. 31, 36; 1995 a. 27 s. 9126 (19); 2007 a. 20 s. 9121 (6) (a); 2009 a. 209.

631.90 Cross-reference Cross-reference: See also s. Ins 3.53, Wis. adm. code.

631.93 631.93 Prohibited provisions concerning HIV infection.

631.93(1) (1) Definitions. In this section, “HIV infection” means the pathological state produced by a human body in response to the presence of HIV, as defined in s. 631.90 (1).

631.93(2) (2) Accident and health insurance. An accident or health insurance policy may not contain exclusions or limitations, including deductibles or copayments, for coverage of the treatment of HIV infection or any illness or medical condition arising from or related to HIV infection, unless the exclusions or limitations apply generally to other illnesses or medical conditions covered by the policy.

631.93(3) (3) Life insurance. A life insurance policy may not deny or limit benefits solely because the insured’s death is caused, directly or indirectly, by HIV infection or any illness or medical condition arising from or related to HIV infection.

631.93 History History: 1989 a. 201.

631.95 631.95 Restrictions on insurance practices; domestic abuse.

631.95(1) (1) Definitions. In this section:

631.95(1)(a) (a) “Abuse” has the meaning given in s. 813.122 (1) (a).

631.95(1)(b) (b) “Disability insurance policy” has the meaning given in s. 632.895 (1) (a).

631.95(1)(c) (c) “Domestic abuse” has the meaning given in s. 968.075 (1) (a).

631.95(2) (2) General prohibitions. Except as provided in sub. (3), an insurer may not do any of the following:

631.95(2)(a) (a) Refuse to provide or renew coverage to a person, or cancel a person’s coverage, under an individual or group insurance policy or a certificate of group insurance on the basis that the person has been, or the insurer has reason to believe that the person is, a victim of abuse or domestic abuse or that a member of the person’s family has been, or the insurer has reason to believe that a member of the person’s family is, a victim of abuse or domestic abuse.

631.95(2)(b) (b) Refuse to provide or renew coverage to an employer or other group, or cancel an employer’s or other group’s coverage, under a group insurance policy on the basis that an employee or other group member has been, or the insurer has reason to believe that an employee or other group member is, a victim of abuse or domestic abuse or that a member of an employee’s or other group member’s family has been, or the insurer has reason to believe that a member of an employee’s or other group member’s family is, a victim of abuse or domestic abuse.

631.95(2)(c) (c) Use as a factor in the determination of rates or any other aspect of insurance coverage under an individual or group insurance policy or a certificate of group insurance the knowledge or suspicion that a person or an employee or other group member has been or is a victim of abuse or domestic abuse or that a member of the person’s or an employee’s or other group member’s family has been or is a victim of abuse or domestic abuse.

631.95(2)(d) (d) Under an individual or group disability insurance policy or a certificate of group disability insurance, exclude or limit coverage of, or deny a claim for, health care services or items related to the treatment of injury or disease resulting from abuse or domestic abuse on the basis that a person or an employee or other group member has been, or the insurer has reason to believe that a person or an employee or other group member is, a victim of abuse or domestic abuse or that a member of the person’s or an employee’s or other group member’s family has been, or the insurer has reason to believe that a member of the person’s or an employee’s or other group member’s family is, a victim of abuse or domestic abuse.

631.95(2)(e) (e) Under an individual or group life insurance policy or a certificate of group life insurance, deny or limit benefits in the event that the death of the person whose life is insured results from abuse or domestic abuse on the basis that the person whose life is insured has been, or the insurer has reason to believe that the person whose life is insured is, a victim of abuse or domestic abuse or that a member of the family of the person whose life is insured has been, or the insurer has reason to believe that a member of the family of the person whose life is insured is, a victim of abuse or domestic abuse.

631.95(2)(f) (f) Under property insurance coverage that excludes coverage for loss or damage to property resulting from intentional acts, deny payment to an insured for a claim based on property loss or damage resulting from an act, or pattern, of abuse or domestic abuse if that insured did not cooperate in or contribute to the creation of the loss or damage and if the person who committed the act or acts that caused the loss or damage is criminally prosecuted for the act or acts. Payment to the innocent insured may be limited in accordance with his or her ownership interest in the property or reduced by payments to a mortgagee or other holder of a secured interest.

631.95(3) (3) Exceptions and qualifications related to prohibitions.

631.95(3)(a) (a) Disability insurance. In establishing premiums for an individual or group disability insurance policy or a certificate of group disability insurance, an insurer may inquire about a person’s existing medical condition and, based on the opinion of a qualified actuary, as defined in s. 623.06 (1) (h), use information related to a person’s existing medical condition, regardless of whether that condition is or may have been caused by abuse or domestic abuse.

631.95(3)(b) (b) Life insurance. With respect to an individual or group life insurance policy or a certificate of group life insurance, an insurer may, on the basis of information in medical, law enforcement or court records, or on the basis of information provided by the insured, policyholder or applicant for insurance, do any of the following:

631.95(3)(b)1. 1. Deny or limit benefits under such a policy or certificate to a beneficiary who is the perpetrator of abuse or domestic abuse that results in the death of the insured.

631.95(3)(b)2. 2. Refuse to issue such a policy or certificate that names as a beneficiary a person who is or was, or who the insurer has reason to believe is or was, a perpetrator of abuse or domestic abuse against the person who is to be the insured under the policy.

631.95(3)(b)3. 3. Refuse to name as a beneficiary under such a policy or certificate a person who is or was, or who the insurer has reason to believe is or was, a perpetrator of abuse or domestic abuse against the insured under the policy.

631.95(3)(b)4. 4. Refuse to issue such a policy or certificate to a person who is or was, or who the insurer has reason to believe is or was, a perpetrator of abuse or domestic abuse against the person who is to be the insured under the policy.

631.95(3)(b)5. 5. Refuse to issue such a policy or certificate to a person who lacks an insurable interest in the person who is to be the insured under the policy.

631.95(3)(b)6. 6. For purposes of underwriting; administering a claim under; or determining a person’s eligibility for coverage, a benefit or payment under; such a policy or certificate; or for purposes of servicing such a policy or certificate or an application for such a policy or certificate; inquire about and use information related to a person’s medical history or existing medical condition, regardless of whether that condition is or may have been caused by abuse or domestic abuse. Any adverse underwriting decision based on a person’s medical history or medical condition must be made in conformity with sound actuarial principles or otherwise supported by actual or reasonably anticipated experience.

631.95(3)(c) (c) Disability income or long-term care insurance. With respect to an individual or group disability income or long-term care insurance policy or a certificate of group disability income or long-term care insurance, an insurer may, on the basis of information in medical, law enforcement or court records, or on the basis of information provided by the insured, policyholder or applicant for insurance, do any of the following:

631.95(3)(c)1. 1. Refuse to name as a beneficiary under such a policy or certificate a person who is or was, or who the insurer has reason to believe is or was, a perpetrator of abuse or domestic abuse against the insured under the policy.

631.95(3)(c)2. 2. Refuse to issue such a policy or certificate to a person who is or was, or who the insurer has reason to believe is or was, a perpetrator of abuse or domestic abuse against the person who is to be the insured under the policy.

631.95(3)(c)3. 3. Refuse to issue such a policy or certificate to a person who lacks an insurable interest in the person who is to be the insured under the policy.

631.95(3)(c)4. 4. For purposes of underwriting; administering a claim under; or determining a person’s eligibility for coverage, a benefit or payment under; such a policy or certificate; or for purposes of servicing such a policy or certificate or an application for such a policy or certificate; inquire about and use information related to a person’s medical history or existing medical condition, regardless of whether that condition is or may have been caused by abuse or domestic abuse. Any adverse underwriting decision based on a person’s medical history or medical condition must be made in conformity with sound actuarial principles or otherwise supported by actual or reasonably anticipated experience.

631.95(4) (4) Immunity for insurers. An insurer is immune from any civil or criminal liability for any action taken under sub. (3) or for the death of, or injury to, an insured that results from abuse or domestic abuse.

631.95(5) (5) Use and disclosure of abuse information.

631.95(5)(a) (a) Except as provided in pars. (c) and (d) and sub. (3), no person employed by or contracting with an insurer may use, disclose or transfer information related to any of the following:

631.95(5)(a)1. 1. Whether an insured or applicant for insurance or a member of the insured’s or applicant’s family, or whether an employee or other group member of an insured or applicant for insurance or a member of the employee’s or other group member’s family, is or has been, or is with reason believed by the person employed by or contracting with the insurer to be or to have been, a victim of abuse or domestic abuse.