HIV Testing Rules and the State Life Insurance Fund
This page covers two Wisconsin-specific subjects: the limits on how a life insurer may use HIV testing, and the State Life Insurance Fund.
HIV testing in life insurance underwriting
HIV is the human immunodeficiency virus, which causes acquired immunodeficiency syndrome, or AIDS (s. 252.01 (1m), Wis. Stat.). Wisconsin law speaks of an “HIV test,” meaning “a test for the presence of HIV or an antibody to HIV” (s. 252.01 (2m)). The rules keep an insurer from penalizing a person for being tested, while letting it underwrite individual coverage with reliable tests.
The general rule (s. 631.90 (2))
An insurer may not:
- require or request, directly or indirectly, that anyone reveal whether they have had an HIV test or what the result was;
- condition coverage on whether a person has had an HIV test or on its result; or
- consider whether a person has had an HIV test, or its result, in setting rates or any other aspect of coverage.
The underwriting exception (s. 631.90 (3))
The general rule does not apply to an HIV test used “in the underwriting of individual life, accident and health insurance policies” that the Commissioner has found and designated by rule as sufficiently reliable. Even then, s. 631.90 (3) (b) states that the exception does not authorize using a test to discriminate unfairly in violation of s. 628.34 (3). Classifications must still relate to the nature and degree of the risk.
The designating rule is s. Ins 3.53, Wis. Adm. Code. Under s. Ins 3.53 (4) (a), an insurer underwriting an individual life, accident or health policy may require the proposed insured to be tested “at the insurer’s expense.” Only the tests listed in the rule may be used: FDA-licensed antibody and antigen tests whose reactive results are confirmed, or molecular (nucleic acid) and viral culture methods, each performed by a laboratory certified under the federal clinical laboratory standards (s. Ins 3.53 (4) (e), (f)).
Consent comes first (s. Ins 3.53 (4) (b) to (d))
Before testing, the insurer must obtain a signed consent form in substantially the format in Appendix A of the rule. The person to be tested signs it unless one of these applies:
| If the proposed insured is… | The form is signed by… |
|---|---|
| Under 14 years of age | A parent or guardian |
| Adjudged incompetent | The guardian |
| Found incapacitated | The health care agent |
The insurer must give a copy of the signed form to the person who signed it and keep a copy for at least one year. With the form, it must also provide the Commissioner’s document on resources for and the implications of a positive HIV test. The form tells the applicant that a positive result may be reported to the Medical Information Bureau and a negative result will not be.
What the application may ask (s. Ins 3.53 (4) (g))
An application may ask whether the proposed insured has been tested, but only with one of the tests the rule lists. It may never ask whether the person was tested at an anonymous counseling and testing site or with an anonymous home test kit, or what such a test showed. When you take an application, do not ask about anonymous testing or record it.
A positive result (s. Ins 3.53 (5), (6))
If a test is positive and affects whether or on what terms the policy is issued, the insurer must give written notice to the person who signed the consent that the proposed insured does not meet its usual underwriting criteria “because of a test result.” It must ask for consent to disclose the result to a health care provider the person chooses. If the person refuses, the insurer must, on request, give the result directly to the person who signed the consent, with a referral to medical and support services. Otherwise, the insurer may disclose a test result only as the consent form describes or with a separate written consent.
Group coverage (s. Ins 3.53 (7))
The underwriting exception covers individual policies only. When an insurer underwrites group life, accident or health coverage on an individual basis, it “may not use or obtain from any source, including the medical information bureau,” a person’s HIV test results or any information on whether the person has been tested.
After the policy is issued (s. 631.93)
Once a life policy is in force, HIV cannot be used to reduce the claim. Under s. 631.93 (3), a life policy “may not deny or limit benefits solely because the insured’s death is caused, directly or indirectly, by HIV infection” or a related illness or condition. A similar rule in s. 631.93 (2) bars accident and health policies from singling out HIV-related treatment for exclusions or limitations that do not apply to other conditions.
The State Life Insurance Fund
The State Life Insurance Fund (“life fund”) is a life insurer operated by the state. It is continued by s. 604.02 (1) (b), Wis. Stat., and governed by ch. 607.
Who runs it and who stands behind it
The Commissioner of Insurance administers the fund as its manager (s. 604.04 (1)). The fund is held in trust for its insureds and claimants and may not be spent for any other state purpose (s. 604.03 (2)). It is not a state guarantee. Under s. 604.06 (2), “neither the state nor any person is liable for any obligations of the funds,” and claimants look only to the fund’s own assets. The life fund is regulated as an insurer under the insurance code, but several chapters do not apply to it, including ch. 646, the Insurance Security Fund (s. 607.03).
What it sells, and to whom
- Eligibility. The fund may issue life insurance to “any resident of the state” (s. 607.02 (1)).
- Products. It may issue any kind of life insurance, with riders and endorsements, that a private life insurer could file with the Commissioner (s. 607.02 (1)).
- Limit. No policy may be issued on any one risk exceeding $10,000 (s. 607.02 (2)).
- Underwriting. No medical examination is required, although the manager may require an exam or medical information “in accordance with usual practices,” and the manager or a designee decides on every application (s. 607.07).
- Dividends. Net profits are distributed annually among policyholders, with the ratio of surplus to assets kept between 7 percent and 10 percent as far as practicable (s. 607.15).
- Loans. Loans are available up to the cash surrender value. An unpaid premium is automatically charged as a policy loan, and the policy ends when the loan and interest equal the cash surrender value (s. 607.22 (1)).
No agents, no commissions
Under s. 607.04, the life fund “may not employ agents or solicitors and may not pay commissions for the procuring of insurance applications.” No producer can be appointed by the fund or earn a commission from it. Residents apply to the fund directly.
Lesson summary
- An insurer generally may not ask about, condition coverage on, or rate based on HIV testing or results (s. 631.90 (2)).
- For individual life, accident and health underwriting, an insurer may require a test the Commissioner has designated, at its own expense, but may not use it to discriminate unfairly (s. 631.90 (3); s. Ins 3.53).
- Testing requires a signed consent form first. A parent or guardian signs for a person under 14, and the insurer keeps the form at least one year.
- Applications may not ask about anonymous-site or home-kit tests, and results stay confidential.
- HIV test information may not be used in group underwriting, and a life policy may not deny or limit benefits because death resulted from HIV (s. 631.93 (3)).
- The State Life Insurance Fund, managed by the Commissioner, sells life insurance to Wisconsin residents, up to $10,000 on any one risk (ss. 604.04, 607.02).
- The fund uses no agents and pays no commissions, and neither the state nor the Insurance Security Fund stands behind it (ss. 607.04, 604.06, 607.03).