Current through August 26, 2024
(1) PURPOSE. The
purpose of this rule is to identify specific acts or practices in life and
disability insurance found to be unfairly discriminatory under s.
628.34(3) (b), Stats.
Note: The need for a rule has arisen because of
questions as to whether life and disability insurers are in all cases fairly
"charging different premiums or offering different terms of coverage except on
the basis of classifications related to the nature and degree of the risk
covered." (s.
628.34(3),
Stats.) The main purpose of the rule is to make clear that life and disability
insurers cannot classify individuals arbitrarily-without a rational basis for
each decision.
(2)
APPLICABILITY AND SCOPE. This rule shall apply to all life and disability
insurance policies delivered or issued for delivery in Wisconsin on or after
January 1, 1980 and to all existing life and disability group, blanket and
franchise insurance policies subject to Wisconsin insurance law which are
amended or renewed on or after January 1, 1980.
(2m) DEFINITIONS. In this section:
(a) "Disability insurance" has the meaning
given under s.
Ins 6.75(1)
(c).
(b) "Territorial classification" means an
arrangement of persons into categories based upon geographic characteristics
other than zip code.
(3)
SPECIFIC EXAMPLES. The following are specific examples of unfair discrimination
under s.
628.34(3) (b), Stats.
(a) Refusing to insure, or refusing to
continue to insure, or limiting the amount, extent or kind of coverage
available to an individual or charging a different rate for the same coverage
solely because of physical or mental impairment, other than blindness or
partial blindness, except where the refusal, limitation or rate differential is
based on sound actuarial principles or is related to actual or reasonably
anticipated experience.
(b) Except
as provided in subds. 1. and 2., refusing to insure, or refusing to continue to
insure, or limiting the amount, extent or kind of coverage available to an
individual, or charging an individual a different rate for the same coverage
solely because of blindness or partial blindness.
1. Individuals who are blind or partially
blind may be subject to standards based on sound actuarial principles or actual
or reasonably anticipated experience with respect to any other condition they
may have, including a condition which is the cause of the blindness or partial
blindness.
2. Refusal to insure
under sub. (3) includes a denial of disability insurance on the basis that the
policy presumes disability if the insured loses his or her eyesight. However,
an insurer may exclude from coverage, or apply a waiting period, to coverage of
treatment of blindness or partial blindness if that condition exists at the
time the policy is issued.
(4) INSURER RESPONSIBILITY. An insurer has
the burden of proof to show that an act, standard or practice of the insurer is
based on sound actuarial principles or is related to actual or reasonably
anticipated experience in any action to enforce s.
628.34(3) (b), Stats. For the anticipated experience to
be reasonable it must be based on medical or actuarial research on morbidity or
mortality.
(5) SEXUAL ORIENTATION.
(a) An insurer may not use sexual orientation
in the underwriting process or in the determination of insurability, premium,
terms of coverage, or nonrenewal.
(b) No insurer may include any inquiry about
the applicant's or insured's sexual orientation in an application for
disability or life insurance coverage or directly or indirectly investigate in
connection with an application for disability or life insurance coverage the
applicant's or insured's sexual orientation.
(c) No insurer may use the marital status,
occupation, gender, medical history, beneficiary designation, or the zip code
or territorial classification of an applicant or insured or any other factor to
establish, or aid in establishing, the applicant's or insured's sexual
orientation.
