Section 628.34 Wis. Stats., provides that "No person . . . may make or cause to be made any communication relating to an insurance contract, the insurance business, any insurer or any intermediary which contains false or misleading information, including information misleading because of incompleteness." and that ". . . no employe of an insurer . . . may seek to induce any person to enter into an insurance contract . . . by offering benefits not specified in the policy . . ." Claims for insurance fraud are generally maintained under common law theories of intentional misrepresentation, negligent misrepresentation and punitive damages.
Attorney Cabaniss prosecuted a fraud case against American Family Insurance Company for its sale of life insurance represented as a "disappearing premium" policy. The essence of the claim was that American Family's agents induced persons to purchase the policy by unfairly representing that if premiums were paid for a specified period of years, the customers would own a fully paid up policy.