611.72 Merger or other acquisition of control of a stock insurance corporation.

(1) General. Subject to this section, ss. 180.1101, 180.1103 to 180.1106, 180.1706, 180.1707, and 180.1708 (5) apply to the merger of a domestic stock insurance corporation or its parent insurance holding corporation, except that papers required by those sections to be filed with the department of financial institutions shall instead be filed with the commissioner.

(2) Approval required. No proposed plan of merger under s. 180.1101 or 180.1104 or other plan for acquisition of control of any domestic stock insurance corporation or its parent insurance holding corporation participating in the transaction may be executed unless it has been approved by the commissioner.

(3) Grounds for disapproval.

(am) The commissioner shall approve the plan if the commissioner finds, after a hearing, unless a hearing is not required under sub. (3m), that it would not violate the law or be contrary to the interests of the insureds of any participating domestic corporation or of the Wisconsin insureds of any participating nondomestic corporation and that:

1. After the change of control, the domestic stock insurance corporation or any domestic stock insurance corporation controlled by the insurance holding corporation would be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed;

2. The effect of the merger or other acquisition of control would not be to create a monopoly or substantially to lessen competition in insurance in this state;

3. The financial condition of any acquiring party is not likely to jeopardize the financial stability of the domestic stock insurance corporation or its parent insurance holding corporation, or prejudice the interests of its Wisconsin policyholders;

4. The plans or proposals which the acquiring party has to liquidate the domestic stock insurance corporation or its parent insurance holding corporation, sell its assets, merge it with any person or make any other material change in its business or corporate structure or management, are fair and reasonable to policyholders of the domestic stock insurance corporation or in the public interest; and

5. The competence and integrity of those persons who would control the operation of the domestic stock insurance corporation or its parent insurance holding corporation are such that it would be in the interest of the policyholders of the corporation and of the public to permit the merger or acquisition of control.

(bm)

1. If the proposed merger or other acquisition of control will require the approval of more than one commissioner, the hearing under par. (am) may be held on a consolidated basis upon the request of a person filing a statement with the commissioner of insurance of this state under s. Ins 40.02 (2), Wis. Adm. Code, which request must be made when the statement is filed. That person shall file a copy of the statement under s. Ins 40.02 (2), Wis. Adm. Code, with the National Association of Insurance Commissioners within 5 days after making the request for a consolidated hearing. A hearing conducted on a consolidated basis shall be public and held within the United States before the commissioners of the states in which the insurers involved in the merger or other acquisition of control are domiciled. The commissioners may hear and receive evidence. A commissioner may attend the hearing in person or by telecommunication.

2. The commissioner of insurance of this state may opt out of a consolidated hearing, and shall provide notice to the person requesting the consolidated hearing of the opt out within 10 days after the commissioner receives the statement under s. Ins 40.02 (2), Wis. Adm. Code.

(3m) Hearing not required. A hearing is not required under sub. (3) before approval of a proposed plan of merger or other plan for acquisition of control if the proposed merger is with, or the proposed acquirer is, an affiliate of the insurer and the proposed merger or other acquisition of control does not change the controlling person of the insurer.

(4) Plans of exchange. Any domestic stock insurance corporation may adopt a plan of exchange of all the outstanding shares of its shareholders under which another stock insurance corporation, which acquires the shares, shall as consideration transfer its own shares or other securities issued by it or pay cash or other consideration, or pay or provide any combination of the foregoing types of consideration. The procedure for the adoption and approval of a plan of exchange and the rights of shareholders of the participating corporations shall be the same as for a merger under subs. (2) and (3).

History: 1971 c. 260; 1973 c. 184; 1979 c. 94; 1989 a. 303; 1995 a. 27; 1999 a. 30; 2001 a. 44; 2003 a. 321; 2007 a. 170; 2013 a. 279.