632.47 Assignment of life insurance rights. (1) GENERAL. Except as provided in sub. (3), the owner of any rights under a life insurance policy or annuity contract may assign any of those rights, including any right to designate a beneficiary and the rights secured under s. 632.57 or any other statute. An assignment valid under general contract law vests the assigned rights in the assignee subject, so far as reasonably necessary for the protection of the insurer, to any provisions in the insurance policy or annuity contract inserted to protect the insurer against double payment or obligation. (2) RELATIVE RIGHTS OF ASSIGNEE AND BENEFICIARY. The rights of a beneficiary under a life insurance policy or annuity contract are subordinate to those of an assignee, unless the beneficiary was effectively designated as an irrevocable beneficiary prior to the assignment. (3) PROHIBITION ON ASSIGNMENT. Assignment may be expressly prohibited by any of the following: (a) A group contract providing annuities as retirement benefits. (b) An annuity contract that is subject to transferability restrictions under any federal or state tax, employee benefit or securities law.
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(b) “Policy loan” means a loan by an insurer, including a premium loan, secured by the cash surrender value of a policy issued by the insurer. (c) “Policy year” means a year beginning on the anniversary date of a policy. (2) INTEREST RATES. A policy providing for policy loans shall contain a provision for a maximum interest rate on the loans in accordance with one but not both of the following: (a) A provision permitting an adjustable maximum rate established from time to time by the insurer. (b) A provision permitting a specified rate not exceeding 12 percent per year. (3) ADJUSTABLE MAXIMUM RATE. The rate of interest charged on a policy loan under sub. (2) (a) shall not exceed the higher of the following: (a) The rate used to compute the cash surrender values under the policy during the applicable period plus 1 percent per year. (b) Moody’s corporate bond yield monthly average, as published by Moody’s Investors Service, Inc., or its successor, for the month ending 2 months before the rate is applied. If the monthly average is no longer published, a comparable average shall be substituted by the commissioner by rule. (4) FREQUENCY OF CHANGES. If the maximum rate of interest is determined under sub. (2) (a) the policy shall contain a provision setting forth the frequency at which the rate is to be determined for that policy. (5) INTERVALS AND LIMITS ON CHANGES. The maximum rate of interest for a policy subject to sub. (2) (a) shall be determined at regular intervals at least once every 12 months, but not more frequently than once in any 3-month period. At the intervals specified in the policy: (a) The rate being charged may be changed as permitted under sub. (3) but no such change shall be less than 0.5 percent per year; and (b) The rate being charged must be reduced to or below the maximum rate as determined under sub. (3) whenever the maximum is lower than the rate being charged by 0.5 percent or more per year. (6) NOTICE. The life insurer shall: (a) Notify the policyholder of the initial rate of interest on the loan at the time a policy loan is made, if the loan is not a premium loan. (b) Notify the policyholder with respect to premium loans of the initial rate of interest on the loan as soon as it is reasonably practical to do so after making the initial loan. Notice need not be given to the policyholder when a further premium loan is added, except as provided in par. (c). (c) Send to policyholders with loans 30 days’ advance notice of any increase in the interest rate. (7) COVERAGE CONTINUATION. No policy may terminate in a policy year as the sole result of a change in the loan interest rate during that policy year. The insurer shall maintain coverage until it would have terminated if there had been no change. (8) POLICY PROVISIONS. The pertinent provisions of subs. (2) and (4) shall be set forth in substance in the policies to which they apply. History: 1981 c. 51; 1983 a. 215; 2001 a. 103.
History: 1975 c. 373, 375, 422; 1999 a. 30.