Chapter 628

628.347(8) (8) Exemptions. This section does not apply to any of the following:

628.347(8)(a) (a) Direct response solicitations in which no recommendation is made based on information collected from the consumer.

628.347(8)(b) (b) Recommendations related to contracts used to fund any of the following:

628.347(8)(b)1. 1. An employee pension or welfare benefit plan that is covered by the federal Employee Retirement and Income Security Act.

628.347(8)(b)2. 2. A plan described in section 401 (a) or (k), 403 (b), or 408 (k) or (p) of the Internal Revenue Code, if the plan is established or maintained by an employer.

628.347(8)(b)3. 3. A government or church plan as defined in section 414 of the Internal Revenue Code, a government or church welfare benefit plan, or a deferred compensation plan of a state or local government or tax exempt organization under section 457 of the Internal Revenue Code.

628.347(8)(b)4. 4. A nonqualified deferred compensation arrangement established or maintained by an employer or plan sponsor.

628.347(8)(b)5. 5. A settlement or assumption of liability associated with personal injury litigation or any dispute or claim resolution process.

628.347(8)(b)6. 6. A formal prepaid funeral or burial contract.

628.347(9) (9) No private cause of action. Nothing in this section may be construed to create or imply a private cause of action for a violation of this section or to subject an insurance intermediary or insurer to civil liability under the best interest standard of care under sub. (2) or under standards governing the conduct of a fiduciary or a fiduciary relationship.

628.347(10) (10) No additional licensure. Nothing in this section may be construed to require an insurance intermediary to obtain any license, including a securities license, other than an insurance intermediary license with the appropriate line of authority to sell, solicit, or negotiate insurance in this state in order to fulfill the duties and obligations contained in this section so long as the insurance intermediary does not give advice or provide services that are otherwise subject to securities laws or engage in any other activity requiring another professional license.

628.347 History History: 2003 a. 261; 2007 a. 168; 2009 a. 343; 2011 a. 260; 2015 a. 90; 2021 a. 260; s. 35.17 correction in (4m) (b) 10. a., b.

628.348 628.348 Sale of long-term care insurance.

628.348(1) (1) Training requirement. On and after January 1, 2009, no person may solicit, negotiate, or sell long-term care insurance unless the person is a licensed intermediary and he or she has completed the initial training portion of the training program under s. 49.45 (31) (c) and completes the ongoing training under s. 49.45 (31) (c) every 24 months after completing the initial training.

628.348(2) (2) Insurer verification. Insurers providing long-term care insurance shall do all of the following:

628.348(2)(a) (a) Obtain from intermediaries selling long-term care insurance on behalf of the insurer verification that the intermediary is in compliance with the training requirements under sub. (1).

628.348(2)(b) (b) Maintain records related to the verifications obtained under par. (a).

628.348(2)(c) (c) Make the records under par. (b) available to the commissioner upon request.

628.348 History History: 2007 a. 20, 226.

628.35 628.35 Prohibition of exclusive contracts. No insurer may make, enforce or participate in any contract or other arrangement for exclusive services of a health care provider that prevents or materially inhibits any other insurer authorized to do business in this state from entering into a contract or other arrangement with any health care provider of services that the other insurer has contracted to supply or for which it has promised indemnity under its insurance contracts, unless:

628.35(1) (1) The health care provider is an individual who is an employee of the insurer;

628.35(2) (2) The health care provider is a corporation owned by the insurer;

628.35(3) (3) The health care provider uses the insurer’s name under a franchise arrangement; or

628.35(4) (4) The case is within a class for which the commissioner by rule establishes an exception after a finding that the contract or other arrangement does not seriously impede the effective operation of a legitimate insurance business by other insurers.

628.35 History History: 1975 c. 223, 371, 422.

628.36 628.36 Limitations on corporations supplying health care services.

628.36(1) (1) Payment methods. Any corporation operating a voluntary health care plan may pay health care professionals on a salary, per patient or fee-for-service basis to provide health care to policyholders or beneficiaries of the corporation.

628.36(2) (2) Discrimination against professionals.

628.36(2)(a) (a) In this section:

628.36(2)(a)1. 1. “Health care plan” means an insurance contract providing coverage of health care expenses.

628.36(2)(a)2. 2. “Provider” means a health care professional, a health care facility or a health care service or organization.

628.36(2)(b) (b)

628.36(2)(b)1. 1. Except for health maintenance organizations, preferred provider plans and limited service health organizations, no health care plan may prevent any person covered under the plan from choosing freely among providers who have agreed to participate in the plan and abide by its terms, except by requiring the person covered to select primary providers to be used when reasonably possible.

628.36(2)(b)2. 2. No provider may be required to participate exclusively in a health care plan as a condition of participation in it.

628.36(2)(b)3. 3. Except as provided in subd. 4., no provider may be denied the opportunity to participate in a health care plan, other than a health maintenance organization, a limited service health organization or a preferred provider plan, under the terms of the plan.

628.36(2)(b)4. 4. Any health care plan may exclude a provider from participation in the health care plan for cause related to the practice of his or her profession.

628.36(2)(b)5. 5. All health care plans, including health maintenance organizations, limited service health organizations and preferred provider plans are subject to s. 632.87 (3).

628.36(2m) (2m) Pharmaceutical services.

628.36(2m)(a) (a) In this subsection:

628.36(2m)(a)1. 1. “Health maintenance organization” has the meaning given in s. 609.01 (2).

628.36(2m)(a)2. 2. “Limited service health organization” has the meaning given in s. 609.01 (3).

628.36(2m)(a)2m. 2m. “Pharmaceutical services” do not include the administration of a drug product or device or vaccine under s. 450.035.

628.36(2m)(a)3. 3. “Preferred provider plan” has the meaning given in s. 609.01 (4).

628.36(2m)(e) (e)

628.36(2m)(e)1. 1. A health maintenance organization, limited service health organization or preferred provider plan that provides coverage of pharmaceutical services when performed by one or more pharmacists who are selected by the organization or plan but who are not full-time salaried employees or partners of the organization or plan shall provide an annual period of at least 30 days during which any pharmacist registered under ch. 450 may elect to participate in the health maintenance organization, limited service health organization or preferred provider plan under its terms as a selected provider for at least one year.

628.36(2m)(e)2. 2. Except as provided in subd. 3., subd. 1. applies to health maintenance organizations on and after May 10, 1984. Except as provided in subd. 4., subd. 1. applies to limited service health organizations and preferred provider plans on or after April 28, 1990.

628.36(2m)(e)3. 3. If compliance with the requirements of subd. 1. during the period specified in subd. 2. would impair any provision of a contract between a health maintenance organization and any other person, and if the contract provision was in existence prior to May 10, 1984, then immediately after the expiration of all such contract provisions the health maintenance organization shall comply with the requirements of subd. 1.

628.36(2m)(e)4. 4. If compliance with the requirements of subd. 1. during the period specified in subd. 2. would impair any provision of a contract between a limited service health organization or preferred provider plan and any other person, and if the contract was in existence prior to April 28, 1990, then immediately after the expiration of all such contract provisions the limited service health organization or preferred provider plan shall comply with the requirements of subd. 1.

628.36(3) (3) Exemption by rule. By rule the commissioner may exempt from the application of any part of subs. (1) to (2m) plans which provide innovative approaches to the delivery of health care or which are designed to contain health care costs, and which cannot operate successfully consistent with all of the provisions in subs. (1) to (2m). The commissioner may promulgate such a rule only if on a finding that the interests of the public require such plans as an experiment, to supply health care services that are not otherwise available in adequate quantity or quality, or to contain health care costs. The promulgated rule shall be as narrow as is compatible with the success of the plans.

628.36(4) (4) Facilitating cost-effective provision of health care services.

628.36(4)(a) (a) The commissioner shall provide information and assistance to the department of employee trust funds, employers and their employees, providers of health care services and members of the public, as provided in par. (b), for the following purposes:

628.36(4)(a)1. 1. To facilitate the development and implementation of health care plans that provide innovative approaches to the delivery of health care services or that are designed to contain health care costs.

628.36(4)(a)2. 2. To increase the awareness and understanding among employers and their employees, providers of health care services and members of the public regarding the availability and nature of innovative or cost-effective health care plans.

628.36(4)(b) (b) The commissioner’s responsibilities in accomplishing the purposes set forth in par. (a) shall include all of the following:

628.36(4)(b)1. 1. Assisting the department of employee trust funds in the development of health care plans under s. 40.51 (7).

628.36(4)(b)2. 2. Providing employers and their employees with information regarding the availability and nature of health care coverage that may be obtained under s. 40.51 (7).

628.36(4)(b)3. 3. Providing information to employers regarding how to proceed under s. 40.51 (7) to obtain health care coverage for their employees.

628.36(4)(b)4. 4. Providing information to employers and their employees and members of the public regarding the availability and nature of various kinds of health care plans, including their distinct and contrasting characteristics.

628.36(4)(b)5. 5. Providing information to employers and their employees, providers of health care services and members of the public regarding the relative effectiveness of various kinds of health care plans in containing health care costs.

628.36 History History: 1975 c. 223, 371, 422; 1983 a. 27, 192, 321, 396; 1985 a. 29; 1987 a. 27; 1989 a. 31, 215; 1991 a. 250; 1997 a. 27, 68; 1997 a. 237 s. 727m.

628.37 628.37 Preservation of professional relationships in professional services. No insurance plan related to or providing health care, legal or other professional services may alter the direct relationship and responsibility of professional persons to their patients or clients for the professional services rendered. All professional relationships are subject to the same rules of contract and tort law and professional ethics as if no insurance plan were involved.

628.37 History History: 1975 c. 223, 371, 422.

628.38 628.38 Disclosure requirements. The commissioner may by rule require insurers to deliver to prospective buyers of life or disability insurance, at a time specified in the rule, information consistent with ss. 601.01 and 628.34 that will improve their ability to select appropriate coverage.

628.38 History History: 1981 c. 82.

628.39 628.39 Extension of credit on premiums. The extension of credit to the insured upon a premium without interest for not exceeding 60 days from the effective date of the policy, or after that time with interest at not less than the legal rate nor more than 18 percent per year on the unpaid balance, is permissible. The payment of premiums on policies issued under a mass marketing program on an installment basis through payroll deductions is not an extension of credit.

628.39 History History: 1975 c. 371; 1979 c. 110 s. 60 (13); 1983 a. 215.

628.40 628.40 Effect of agent’s appointment on insurer. Every insurer is bound by any act of its agent performed in this state that is within the scope of the agent’s apparent authority, while the agency contract remains in force and after that time until the insurer has made reasonable efforts to recover from the agent its policy forms and other indicia of agency. Reasonable efforts shall include a formal demand in writing for return of the indicia, and notice to the commissioner if the agent does not comply with the demand promptly.

628.40 History History: 1975 c. 371, 421.

628.46 628.46 Timely payment of claims.

628.46(1) (1) Unless otherwise provided by law, an insurer shall promptly pay every insurance claim. A claim shall be overdue if not paid within 30 days after the insurer is furnished written notice of the fact of a covered loss and of the amount of the loss. If such written notice is not furnished to the insurer as to the entire claim, any partial amount supported by written notice is overdue if not paid within 30 days after such written notice is furnished to the insurer. Any part or all of the remainder of the claim that is subsequently supported by written notice is overdue if not paid within 30 days after written notice is furnished to the insurer. Any payment shall not be deemed overdue when the insurer has reasonable proof to establish that the insurer is not responsible for the payment, notwithstanding that written notice has been furnished to the insurer. For the purpose of calculating the extent to which any claim is overdue, payment shall be treated as being made on the date a draft or other valid instrument which is equivalent to payment was placed in the U.S. mail in a properly addressed, postpaid envelope, or, if not so posted, on the date of delivery. All overdue payments shall bear simple interest at the rate of 7.5 percent per year.

628.46(2) (2) Notwithstanding sub. (1), the payment of a claim shall not be overdue until 30 days after the insurer receives the proof of loss required under the policy or equivalent evidence of such loss. The payment of a claim shall not be overdue during any period in which the insurer is unable to pay such claim because there is no recipient who is legally able to give a valid release for such payment, or in which the insurer is unable to determine who is entitled to receive such payment, if the insurer has promptly notified the claimant of such inability and has offered in good faith to promptly pay said claim upon determination of who is entitled to receive such payment.

628.46(2m) (2m) 

628.46(2m)(a) (a) Notwithstanding subs. (1) and (2) and except as provided in par. (b), a claim for payment for chiropractic services is overdue if not paid within 30 days after the insurer receives clinical documentation from the chiropractor that the services were provided unless, within those 30 days, the insurer provides to the insured and to the chiropractor the written statement under s. 632.875 (2).

628.46(2m)(b) (b) Paragraph (a) does not apply to any of the following:

628.46(2m)(b)1. 1. Worker’s compensation insurance.

628.46(2m)(b)2. 2. Any line of property and casualty insurance except disability insurance. In this subdivision, “disability insurance” does not include uninsured motorist coverage, underinsured motorist coverage, or medical payment coverage.

628.46(3) (3) This section applies only to the classes of claims enumerated in s. 646.31 (2).

628.46 History History: 1975 c. 375; 1979 c. 109 s. 16; 1979 c. 110 s. 60 (13); 1981 c. 38 s. 24; Stats. 1981 s. 628.46; 2001 a. 16, 65; 2017 a. 235.

628.46 Annotation Receipt of a legally binding offer to settle a claim against the insured is not required for the insured to have a claim against the insurer for bad-faith failure to settle. Alt v. American Family Mutual Insurance Co., 71 Wis. 2d 340, 237 N.W.2d 706 (1976).

628.46 Annotation An insured may bring a tort action against an insurer for failure to exercise good faith in settling the insured’s claim. This section is unrelated to such a tort action. Anderson v. Continental Insurance Co., 85 Wis. 2d 675, 271 N.W.2d 368 (1978).

628.46 Annotation Discussing the tort of bad faith handling of a claim. Davis v. Allstate Insurance Co., 101 Wis. 2d 1, 303 N.W.2d 596 (1981).

628.46 Annotation A third-party claimant cannot assert a bad faith claim against an insurer. Kranzush v. Badger State Mutual Casualty Co., 103 Wis. 2d 56, 307 N.W.2d 256 (1981).

628.46 Annotation This section applies to service insurance corporations. Wisconsin Physicians Service Insurance Corp. v. Mitchell, 114 Wis. 2d 338, 338 N.W.2d 326 (Ct. App. 1983).

628.46 Annotation A jury’s imposition of punitive damages and finding of bad faith is adequate to show that the insurer did not have reasonable proof that it was not responsible for a claim and supports an award of prejudgment interest under sub. (1). Upthegrove Hardware, Inc. v. Pennsylvania Lumbermans Mutual Insurance Co., 146 Wis. 2d 470, 431 N.W.2d 689 (Ct. App. 1988).

628.46 Annotation Interest under s. 807.01 (4) is not in addition to interest under sub. (1). Upthegrove Hardware, Inc. v. Pennsylvania Lumbermans Insurance Co., 152 Wis. 2d 7, 447 N.W.2d 367 (Ct. App. 1989).

628.46 Annotation This section makes no distinction between the payment of claims based on judgments and all other claims; a claim may be due under sub. (2) far in advance of a judgment or award. Fritsche v. Ford Motor Credit Co., 171 Wis. 2d 280, 491 N.W.2d 119 (Ct. App. 1992).

628.46 Annotation Whether to assess 12 percent [now 7.5 percent] interest is dependent on whether the insurer had reasonable proof establishing that it was not responsible for payment. U.S. Fire Insurance Co. v. Good Humor Corp., 173 Wis. 2d 804, 496 N.W.2d 730 (Ct. App. 1993).

628.46 Annotation This section applies to the insurance company of a negligent tortfeasor and, thus, allows the recovery of interest by a third-party claimant. When there is clear liability, a sum certain owed, and written notice of both, the plain language of this section, incorporating by reference s. 646.31 (2), imposes 12 percent [now 7.5 percent] simple interest on overdue payments to third-party claimants. Kontowicz v. American Standard Insurance Co. of Wisconsin, 2006 WI 48, 290 Wis. 2d 302, 714 N.W.2d 105, 03-2177.

628.46 Annotation An insurer’s subrogation interest did not permit it to step into the insured’s shoes to assert a 12 percent [now 7.5 percent] interest claim under the facts and circumstances of the case. Legal subrogation gives indemnity only, and an insurer who possesses a cause of action for subrogation cannot recover beyond the amount actually dispersed by it. Zurich American Insurance Co. v. Wisconsin Physicians Services Insurance Corp., 2007 WI App 259, 306 Wis. 2d 617, 743 N.W.2d 710, 06-2320.