Wisconsin Statutes Insurance (Ch. 600 to 655) § 632.62. Participating and nonparticipating policies

(1) Authorization. (a) Stock insurers. A stock insurer may issue both participating and nonparticipating life insurance policies and annuity contracts, subject to this section.

(b) Fraternals and mutual insurers. A fraternal or mutual insurer issuing life insurance policies may issue only participating policies, except for the following situations in which it may issue nonparticipating policies:

(4) Dividend payments.(a) Deferred dividends. No life insurance policy or certificate may be issued in which the distribution of dividends, if any, is deferred for a period longer than one year.

(b) Payment. Every insurer doing a participating business shall annually ascertain the surplus over required reserves and other liabilities. After setting aside such amounts as may be lawful and considered necessary by the insurer's board of directors for providing for the growth of the company and for protecting the ability to meet ongoing and future claims and other obligations and needs under both normal and stressed environments, and after making provision for the payment of reasonable dividends upon capital stock as determined by the insurer's board of directors and such sums as are required by prior contracts to be held on account of deferred dividend policies, an insurer shall distribute as dividends the remaining surplus, if any, attributable to participating life insurance and annuity policies in such amounts, including zero, and in such allocations among the participating life insurance and annuity policies as its board of directors determines to be reasonably proportioned to its calculation of the life insurance and annuity policies' contribution to the distributable surplus. A dividend may be conditioned on the payment of the succeeding year's premium only on the first and second anniversaries of the policy.