Ins 6.50 History History: Cr. Register, December, 1967, No. 144, eff. 1-1-68; r. and recr. (3) (d), Register, November, 1971, No. 191, eff. 12-1-71: am. (2) (e), Register, February, 1973, No. 206, eff. 3-1-73; am. (2) (h), Register, September, 1973, No. 213, eff. 10-1-73: cr. (2) (o), Register, May, 1975, No. 233, eff. 6-1-75; emerg. am. (1), (2), (3) (a) and (c), eff. 6-22-76; am. (1), (2), (3) (a) and (c), Register, September, 1976, No. 249, eff. 10-1-76; r. and recr., Register, August, 1977, No. 260, eff. 9-1-77; r. (2) (f), Register, October, l981, No. 310, eff. 11-1-81; r. (2) (i), Register, July, 1991, No. 427, eff. 8-1-91; emerg. am. (1) and (2) (intro.), cr. (2) (i) to (k), eff. 3-12-93; emerg. am. (2) (b) and (e), eff. 7-1-93; am. (1) and (2) (intro.), (b) and (e), cr. (2) (i) to (k), Register, July, 1993, No. 451, eff. 8-1-93; CR 01-074: r. and recr. (2), Register January 2002 No. 553, eff. 2-1-02; CR 07-096: cr. (2) (b) 5. Register March 2008 No. 627, eff. 4-1-08; CR 09-022: cr. (2) (a) 6., (b) 6. and 7. Register August 2009 No. 644, eff. 9-1-09; correction to numbering of (2) (b) 6. and 7. made under s. 13.92 (4) (b) 1., Stats., Register August 2009 No. 644.

Ins 6.51 Ins 6.51 Group life and disability coverage termination and replacement.

Ins 6.51(1) (1) Purpose. This section is intended to promote the fair and equitable treatment of group policyholders, insurers, employees and dependents, and the general public by setting out procedures to be followed when a group life or disability insurance policy is terminated or replaced, and to interpret ss. 632.79 and 632.897, Stats.

Ins 6.51(2) (2) Scope. This section shall apply to all group life and group disability policies covering employees or employees and dependents, issued by insurers providing insurance as defined in s. Ins 6.75 (1) (a) or (c) or (2) (c). It shall apply to blanket policies only if they provide 24-hour coverage for both injury and sickness; any blanket policy, covering any type of group, which provides for renewal shall be subject to subs. (4) and (5); any blanket policy covering students of a college or university, regardless of whether it provides for renewal, shall be subject to subs. (6) and (7). Subsection (4) (a) shall apply only to group policies as defined in sub. (3) (c) 2. Subsections (6) and (7) do not apply to excess or stop-loss insurance purchased under s. 120.13 (2) (c), Stats., by a county or school district that self-insures employee health benefits.

Ins 6.51(3) (3) Definitions.

Ins 6.51(3)(a) (a) “Blanket policy” has the meaning in s. 600.03 (4), Stats.

Ins 6.51(3)(b) (b) “Employee” means an employee of an employer or a member of a union or association or a student of a college or university.

Ins 6.51(3)(c) (c) “Group policy”:

Ins 6.51(3)(c)1. 1. Means a policy or contract covering employees issued by an insurer to an employer, labor union, association or trust fund or, in the case of a blanket policy, a college or university, or a group type plan, except that;

Ins 6.51(3)(c)2. 2. In sub. (4) (a), means only a policy or contract issued by an insurer or a s. 185.981, Stats., co-operative or a group type plan issued by a ch. 613, Stats., corporation, providing hospital, surgical or medical expense coverage to or on behalf of an employer.

Ins 6.51(3)(d) (d) A “group policy providing medical expense coverage” does not include a policy providing coverage for dental, vision care, hearing care or prescription drug expense coverage only.

Ins 6.51(3)(e) (e) “Group policyholder” means an employer, labor union, association, trust fund or other entity responsible for making group policy premium payments to an insurer.

Ins 6.51(3)(f) (f) “Group type plan” means an insurance plan using individual policies which meets the following conditions:

Ins 6.51(3)(f)1. 1. Coverage is provided to classes of employees defined in terms of conditions pertaining to employment or membership.

Ins 6.51(3)(f)2. 2. The coverage is not available to the general public and can be obtained and maintained only because of the covered person’s connection with the particular organization or group.

Ins 6.51(3)(f)3. 3. Premiums are paid by the group policyholder to the insurer on behalf of covered employees, and

Ins 6.51(3)(f)4. 4. An employer, union, association or trust fund sponsors or authorizes the plan.

Ins 6.51(3)(g) (g) “Individual policy” means an individual or family policy or subscriber contract issued by an insurer.

Ins 6.51(3)(h) (h) “Insurer” means an insurance company subject to chs. 631 and 632, Stats., or a service insurance corporation subject to ch. 613, Stats.

Ins 6.51(3)(i) (i) “Premium” means a policy premium or a subscriber contract subscription fee.

Ins 6.51(3)(j) (j) “Pre-existing condition” means a disease or physical condition including pregnancy which manifested itself prior to the effective date of coverage through medical diagnosis or treatment or the existence of symptoms which would cause an ordinarily prudent person to seek diagnosis or treatment.

Ins 6.51(3)(k) (k) “Validly covered” means that the individual involved was covered and met all policy requirements regarding eligibility for coverage, as opposed to an individual who was covered without having met all such requirements.

Ins 6.51(4) (4) Effective date of termination for non-payment of premium; Notice of termination; liability of insurer.

Ins 6.51(4)(a) (a) A group policy subject to s. 632.79, Stats., as defined in sub. (3) (c) 2. may not be terminated by the insurer unless it has provided the termination notices required by s. 632.79 (2), Stats., except as provided in s. 632.79 (5), Stats. The insurer shall be liable for valid claims for covered losses as provided in s. 632.79 (3), Stats.

Ins 6.51(4)(b) (b) Under a group policy other than one subject to s. 632.79, Stats., the insurer shall be liable for valid claims for covered losses incurred prior to the end of the grace period provided in the policy. This provision does not prevent a group policyholder from giving written notice of termination of the group policy, prior to the termination date, in accordance with the group policy terms, to reduce or eliminate the grace period.

Ins 6.51(4)(c) (c)

Ins 6.51(4)(c)1. 1. The insurer shall also be liable for valid claims for covered losses beginning prior to the effective date of written notice of termination to the group policyholder if, after the end of the grace period provided in the policy:

Ins 6.51(4)(c)1.a. a. It continues to recognize claims subsequently incurred for which recognition is not required by an applicable extension of coverage provision, or

Ins 6.51(4)(c)1.b. b. It fails to request that the group policyholder notify covered employees of the termination and, except for life and disability income coverages, describe their rights, if any, upon termination.