## Facts

- Melissa and Kenneth Anderson were clients of attorney Thomas Aul in an underlying matter.
- The Andersons sent Aul a letter that placed him on notice of a potential legal-malpractice claim.
- Aul had a claims-made-and-reported professional liability policy issued by Wisconsin Lawyers Mutual Insurance Company (WILMIC).
- The policy required both that the claim be first made during the policy period and that it be reported to WILMIC during that same policy period as a condition of coverage.
- Aul did not report the potential claim to WILMIC until nearly one year after the policy period ended.
- The Andersons later sued Aul and related entities for malpractice; WILMIC intervened, seeking a declaration of no coverage due to late reporting.

## Issues

1. Whether Wisconsin’s notice-prejudice statutes, Wis. Stat. §§ 631.81(1) and 632.26(2), invalidate or supersede a claims-made-and-reported policy term requiring reporting within the policy period as a condition of coverage.
2. Whether an insurer must show prejudice to deny coverage when a claim is first made within the policy period but reported after the policy expires.

## Decision

- The Wisconsin Supreme Court reversed the court of appeals and reinstated summary judgment for WILMIC.
- The court held the notice-prejudice statutes do not supersede a claims-made-and-reported policy’s requirement that reporting occur within the policy period.
- Because the claim was not reported within the policy period, WILMIC owed no coverage, regardless of prejudice.

## Legal Principles

- In a claims-made-and-reported policy, timely reporting within the policy period is part of the coverage grant and defines the scope of risk insured, not merely a post-loss notice condition.
- Wisconsin’s notice-prejudice statutes apply to late notice of claims otherwise within the policy’s coverage; they do not expand coverage beyond the policy’s temporal limits.
- Courts will not apply notice-prejudice rules to rewrite a claims-made-and-reported policy by extending the reporting period beyond the contracted policy term.

## Conclusion

The court enforced the report-within-the-policy-period requirement in a claims-made-and-reported professional liability policy and held that Wisconsin’s notice-prejudice statutes do not require coverage for claims reported after the policy expires.


Anderson v. Aul, 862 N.W.2d 304 (Wis. 2015)