INSURANCE BARTENDER
SCHEDULE RATING UPDATE & CITY OF MILWAUKEE CONTRACTOR INSURANCE REQUIREMENTS
Thank you!
I want to start off by thanking all our company sponsors. Without their support, the IIAW could not do what we do on behalf of the independent agency channel. Their support is critical to our mission of serving independent agents. As a member of the association, please take a moment the next time to chat with one of our company supporters and thank them for their support of your association.
Schedule Rating Update
the Rating Committee did not assent to the motion and the OCI abstained, the motion did not pass. We will continue to monitor the situation, but we hope, for now, the issue of advancing schedule rating in Wisconsin is dead. If more action is taken, we will be sure and communicate accordingly to our members and move aggressively to defeat it. The IIAW wishes to thank those carriers that voted against schedule rating and stood with their independent agency sales force in opposition. If you have any questions regarding the events that occurred and would like additional insight and information, please do not hesitate to contact me.
City of Milwaukee Contractor Insurance Requirements
As you may know, several carriers have been advocating for the implementation of schedule rating. Early last year the IIAW Board of Directors voted unanimously to oppose efforts within the Workers Compensation Rating Bureau (WCRB) to recommend to the Commissioner of Insurance that Wisconsin move to adopt schedule rating. As a result, IIAW Government Affairs Chairman Jeff Thiel and I have been very active in presenting at and attending WCRB meetings and voicing our opposition to any effort to adopt schedule rating. The IIAW has also discussed our opposition with Insurance Commissioner Mark Afable and his staff. On September 2, 2020 a motion was brought forward within the WCRB’s rating committee that would have advanced the exploration of schedule rating in Wisconsin. The vote on the motion resulted in a 6-6 tie. In the event of a tie, the motion goes to OCI to break the tie. On September 16th, the IIAW was notified that OCI had chosen to abstain from voting on the motion whether to move forward with further evaluating the extent of industry support for schedule rating in Wisconsin.Pursuant to WCRB Bylaws, Article XI, Paragraph 2, because a majority of members of 20
| OCTOBER 2020 |
wisconsin INDEPENDENT AGENT
Over the last month, I have been contacted by several agency members regarding whether the City of Milwaukee’s standards preclude permitting contractors who meet the City’s insurance requirements through surplus lines insurance. The City of Milwaukee (or one or more of its departments) has denied permits to contractors who seek to meet the City’s insurance requirements through surplus lines insurance. The City has relied on contract terms which require that a contractor’s insurance carrier “be authorized to sell insurance in the State of Wisconsin and . . . submit its agent’s license with the certificates [of insurance].” The City’s reliance on those terms appears to be misplaced. In working with IIAW’s Legal Counsel, Josh Johanningmeier, we reviewed the sample terms which the City has cited when denying contractor clients permits. According to the team at Godfrey & Kahn S.C., “the short answer is that the City’s standards likely do not preclude the use of surplus lines insurance. As an initial matter, Wis. Stat. § 618.41 permits domestic surplus lines insurers and nondomestic insurers that have not been licensed by the State to place surplus lines coverage in accordance with the statute. Such surplus lines insurers are, thus, “authorized” to sell insurance in Wisconsin.
