As the Wisconsin Assembly considers life settlement legislation this week, an amendment that would have required life insurers to disclose the life settlement option was unsuccessful.
The Wisconsin Senate has passed SB 513 and the Assembly passed it out of the Assembly insurance committee on April 13 without amendments, according to a representative for State Sen. Robert Wirch, D-District 22, (Kenosha County.) State Sen. Wirch introduced SB 513. The bill could be on the Assembly floor as early as tomorrow. There is currently no word on whether there will be additional amendments. If it passes without amendments it would be sent to Wisconsin Gov. Jim Doyle for his signature. If amendments are added, the amended bill will be messaged to the senate, according to Sen. Werch’s representative. The Senate then can concur with the message, return it to the Committee on Small Business, Emergency Preparedness, Technical Colleges, and Consumer Protection for additional work, or send it back to the Assembly and request that it reconsider the changes, the representative adds.
Wisconsin Insurance Commissioner Sean Dilweg has indicated that the disclosure amendment is not needed since the commissioner currently has the authority to require such a disclosure, according to Jim Guidry, a department spokesperson. When asked why the Commissioner had not favored making it a requirement in the bill, Guidry said that the Commissioner had not provided a reason.
Dilweg supports the bill in the legislature. He convened a department working group to examine the issue. That group spent seven months examining what kind of legislation should be introduced in the Wisconsin legislature, according to Guidry.
The disclosure amendment was offered on April 12 by state Rep. Louis Molepske, Jr., D-71 A.D (Stevens Point, Wisc.) It received a tie 5-5 vote. But a majority vote was needed in order for the amendment to be included in the bill. The proposed change to AB 758 and its Senate equivalent, SB 513, would have required that an insurer provide the disclosure notice to an owner at all of the following times:
--When the insurer receives from the owner a request to surrender, in whole
or in part, an individual policy;
--When the insurer receives from the owner a request to receive an accelerated
death benefit under an individual policy;
--When the insurer sends to the owner any notice of lapse of an individual
--At any time the commissioner prescribes by rule.
The amendment would have allowed the commissioner to apply the disclosure statement to contracts with a net death benefit of $100,000 or more. However, that condition would have applied only if it did not discriminate against owners of life insurance based on a wide range of criteria including economic status.
Separately, the Assembly Insurance Committee is also considering SB 572 and AB 811 which establishes suitability standards for annuities reflecting recent changes made at the National Association of Insurance Commissioners, Kansas City, Mo. The state Senate passed SB 572 and the Assembly Insurance Committee voted on the bill on April 13. The bill could be finalized in the legislature next week.
Guidry says that the Commissioner supports the measure.