Section Ins 6.10 - Property and casualty premium restrictions(1) PURPOSE. This section requires insurers who may return a premium that is less than the pro rata unearned premium to disclose this to the insured. This section also establishes prohibitions concerning specified practices relating to premiums. This section implements and interprets ss. 227.10(1), 601.01(2), 625.13(1), 628.34(1), (3), (11), and (12), 631.20 and 631.36(2), Stats.(2) SCOPE. This section applies to all lines or classes of insurance classified as property and casualty insurance in s. Ins 6.75(2), except lines or classes of insurance providing disability insurance under s. Ins 6.75(2) (c) and (k).(3) DEFINITIONS. In this section: (a) "Pro rata unearned premium" means the pro rata portion of the written premium covering the unexpired portion of the policy term for which the written premium has been charged by the insurer to the policyholder.(b) "Written premium" means the entire amount of premium charged a policyholder for the term of the policy.(4) PREMIUM IN EXCESS OF PRO RATA EARNED PREMIUM: FILING, RESTRICTIONS, DISCLOSURES. (a) An insurer shall file with the commissioner in accordance with s. 625.13, Stats., and s. Ins 6.06 any schedule of return premium applicable in the event of policy cancellation wherein the return of premium is less than the pro rata unearned premium for that policy form. The rate filing shall include the basis of the premium calculation in the event of a policy cancellation.(b) Subject to par. (c), in any policy under which an insurer may return a premium that is less than the pro rata unearned premium, the insurer shall provide the policyholder with a separate written notice that the policyholder may pay a substantial penalty if the policyholder cancels the policy prior to its expiration date. No insurer may return a premium that is less than the pro rata unearned premium until at least 10 days after the insurer mails or delivers this written notice to the policyholder.(c) Notwithstanding pars. (a) and (b), no insurer may return to the policyholder a premium that is less than the pro rata unearned premium if the insurer initiates cancellation or for a cancellation due to the nonpayment of premium.(5) MISCELLANEOUS PREMIUM PROHIBITION. No insurer may initiate cancellation of one policy solely to apply the pro rata unearned premium of that policy to the balance due on another policy.Wis. Admin. Code Office of the Commissioner of Insurance Ins 6.10
Cr. Register, August, 1989, No. 404, eff. 10-1-89; am. (2), Register, April, 1992, No. 436, eff. 5-1-92.