The Wisconsin Office of the Commissioner of Insurance (OCI) has issued a bulletin to insurers regarding Surplus Lines Forms Filings following a recent decision in federal court.
The bulletin noted that in the Gillen case, the Federal District Court in the Eastern District of Wisconsin held that s. 631.20 (form filing) and s. 631.85 (arbitration clause approval required) applied to a surplus lines policy. The surplus lines insurer tried to compel arbitration of an indemnity liability claim of its insured. The court ruled the arbitration clause was unenforceable because the form had not been filed with and the arbitration clause approved by OCI under the cited statutes.
The bulletin added that as a result of the Gillen case, the OCI has received inquiries from surplus lines companies regarding the requirement of and procedure for filing with the OCI forms that are written under s. 618.41, Wis. Stat. OCI has not historically required surplus lines insurers to file forms in Wisconsin and, notwithstanding the Gillen decision [747 F. Supp. 2d 1058], the Office continues its position that surplus lines forms need not be filed, including those with arbitration clauses. All surplus lines insurers placing business in Wisconsin are informed that the OCI does not consider policy forms issued under s. 618.41, Wis. Stat., on business that is resident or located in Wisconsin to be subject to ss. 631.20 and 631.85, Wis. Stat. Therefore, companies writing in Wisconsin on a surplus lines basis are not required by OCI to file their forms with the Office.
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