November 16, 2019
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CS/HB 853

1
A bill to be entitled
2An act relating to title insurance; creating part I of ch.
3637, F.S.; providing for administration of title insurance
4and general provisions; providing a short title; providing
5legislative findings, purposes, and intent; providing
6definitions; preempting to the state the regulation of
7title insurance, title insurers, and title insurance
8agencies; providing for nonapplication of certain
9chapters; duplicating in ch. 637, F.S., certain provisions
10of chs. 624, 625, 626, and 628, F.S., relating to
11insurance and making such provisions applicable to title
12insurance, title insurers, title insurance agents, and
13title insurance agencies; creating s. 637.10335, F.S.;
14providing for civil remedies against title insurers;
15providing procedures, requirements, and limitations;
16providing for award of damages, court costs, and attorney
17fees; prohibiting punitive damages under certain
18circumstances; providing construction prohibitions;
19preserving certain remedies and causes of action; creating
20s. 637.10435, F.S.; providing a Policyholders Bill of
21Rights; specifying principles; providing a construction
22prohibition; creating s. 637.10445, F.S.; providing
23procedures, requirements, and limitations for documents
24claimed as trade secrets; creating part II of ch. 637,
25F.S.; providing for licensing and administration of title
26insurers; duplicating in ch. 637, F.S., and making
27applicable to title insurers certain provisions of ch.
28624, F.S.; transferring to ch. 637, F.S., certain
29provisions of chs. 625 and 627, F.S., relating to title
30insurance; creating s. 637.20035, F.S.; providing for
31structure of title insurers; transferring, renumbering,
32and amending s. 627.7865, F.S.; specifying requirements,
33procedures, and limitation for assessments against title
34insurers in liquidation; creating s. 637.2091, F.S.;
35specifying that title insurance business in exclusive;
36creating part III of ch. 637, F.S.; providing for
37licensure and administration of title insurance agents and
38agencies; duplicating in ch. 637, F.S., and making
39applicable to title insurance agents and agencies certain
40provisions of ch. 626, F.S.; transferring to ch. 637,
41F.S., certain provisions of ch. 626, F.S., relating to
42title insurance agents and agencies; creating s.
43637.30125, F.S.; providing requirements for agents in
44charge; providing for authority, duties, and
45responsibilities of agents in charge; transferring
46regulation, administration, and enforcement of title
47insurers and authority to establish title insurance
48premium rates and forms from the Office of Insurance
49Regulation and the Financial Services Commission to the
50Department of Financial Services; deleting references to
51the office and commission to conform; amending ss.
52624.5105 and 624.5107, F.S.; including references to
53applicable sections of ch. 637, F.S., under the community
54contribution tax credit program and the child care tax
55credit program; specifying rules of the Financial Services
56Commission and the Office of Insurance Regulation as rules
57of the department; transferring certain powers, duties,
58functions, records, personnel, property, and unexpended
59balances of appropriations, allocations, and other funds
60relating to title insurance to the department; preserving
61the validity of certain judicial and administrative
62actions relating to title insurance; providing for
63transfer of certain orders relating to title insurance to
64the department; requiring the Division of Statutory
65Revision to assist substantive legislative committees in
66developing conforming legislation; creating s. 689.263,
67F.S.; prohibiting title insurance agents or title
68insurance agencies from disbursing certain funds under
69certain circumstances; providing requirements for a
70statement of settlement costs; creating s. 717.1121, F.S.;
71providing construction of certain payments from escrow
72related to real estate transactions; amending s. 877.101,
73F.S.; providing an additional prohibition against
74transacting escrow business by unauthorized persons;
75revising cross-references for purposes of nonapplication
76to licensed title insurance agents; amending ss. 624.5015,
77626.241, and 626.331, F.S.; deleting provisions relating
78to title insures; amending ss. 197.502, 624.501, 624.604,
79624.605, 625.031, 626.207, 655.005, 701.041, and 721.05,
80F.S.; conforming a cross-reference; repealing s. 624.608,
81F.S., relating to the definition of "title insurance";
82repealing s. 626.841, F.S., relating to definitions of
83"title insurance agent" and "title insurance agency";
84repealing s. 626.8411, F.S., relating to application of
85Florida Insurance Code provisions to title insurance
86agents or agencies; repealing s. 626.9531, F.S., relating
87to identification of insurers, agents, and insurance
88contracts; repealing s. 627.7711, F.S., relating to
89definitions; repealing s. 627.776, F.S., relating to
90applicability or inapplicability of Florida Insurance Code
91provisions to title insurers; providing an effective date.
92
93Be It Enacted by the Legislature of the State of Florida:
94
95     Section 1.  Part I of chapter 637, Florida Statutes,
96consisting of sections 637.1001, 637.1002, 637.1004, 637.10045,
97637.1005, 637.1006, 637.1007, 637.1008, 637.1009, 637.1011,
98637.1012, 637.1013, 637.1014, 637.1015, 637.1016, 637.1017,
99637.1018, 637.1019, 637.1021, 637.1022, 637.1023, 637.1024,
100637.1025, 637.1026, 637.1027, 637.1028, 637.1029, 637.1031,
101637.1032, 637.1033, 637.10335, 637.1034, 637.1035, 637.1036,
102637.1037, 637.1038, 637.1039, 637.1041, 637.1042, 637.1043,
103637.10435, 637.1044, 637.10445, 637.1045, 637.1046, 637.1047,
104637.1048, and 637.1049, is created and entitled "ADMINISTRATION
105AND GENERAL PROVISIONS."
106     Section 2.  Sections 637.1001, 637.1002, 637.1004,
107637.10045, 637.1005, 637.1006, 637.1007, 637.1008, 637.1009,
108637.1011, 637.1012, 637.1013, 637.1014, 637.1015, 637.1016,
109637.1017, 637.1018, 637.1019, 637.1021, 637.1022, 637.1023,
110637.1024, 637.1025, 637.1026, 637.1027, 637.1029, 637.1031,
111637.1032, 637.1033, 637.10335, 637.1034, 637.1035, 637.1036,
112637.1037, 637.1038, 637.1039, 637.1041, 637.1042, 637.1043,
113637.10435, 637.1044, 637.10445, 637.1045, 637.1046, 637.1047,
114637.1048, and 637.1049, are created to read:
115     637.1001  Short title.-This chapter may be cited as the
116"Florida Title Insurance Act."
117     637.1002  Legislative findings; purpose; intent.-
118     (1)  The Legislature finds that a stable and efficient
119title insurance delivery system is necessary to promote the
120economic wellbeing of the citizens of this state. Title
121insurance is essential to ensure homeowners and landowners of
122the safety of real property transfers in the state. Lienholders
123and investors require the security afforded their business
124interests accorded by a financially stable and regulated title
125insurance industry. A viable title insurance delivery system
126requires comprehensive state oversight, including regulation of
127title insurers, agents, and agencies. Accordingly, it is the
128intent of the Legislature to establish unitary regulation of the
129title insurance industry by a type two transfer from the
130Financial Services Commission and the Office of Insurance
131Regulation to the Department of Financial Services, as set forth
132in this chapter. The department shall have comprehensive
133authority to regulate title insurer, title agent, and title
134agency solvency, education, licensing, and discipline and to
135establish title insurance premium rates and forms.
136     (2)  The Legislature finds that title insurance is a unique
137form of insurance unlike any casualty-based insurance.
138Accordingly, a separate and distinct chapter of the Florida
139Statutes is deemed appropriate.
140     (3)  The Legislature recognizes that the title insurance
141industry is founded upon a unique structure that requires title
142agents and agencies to determine the insurability of titles,
143thereby placing the title insurance agent at the cornerstone of
144the delivery system. As such, the solvency and viability of
145title insurance agents is essential. Therefore, the Legislature
146deems it to be in the public interest to establish title
147insurance rates that are adequate and to also establish
148parameters for rebating portions of the title insurance premium.
149     (4)  The Legislature finds that the unique issues relating
150to title insurance premium rebates and negotiating the cost of
151related closing services require clarification for the
152protection of insurer solvency and consumer safety. The
153Legislature finds that any portion of premium paid by a title
154insurer to its agents is made for purposes of joint underwriting
155and the creation of each individual insurance contract and not
156for purposes of providing direct services to the consumer. The
157Legislature further finds that negotiating or rebating closing
158services fees should not be restricted, but that discounting
159premiums jeopardizes the solvency of insurers and the
160maintenance of an efficient delivery system for title insurance
161and impairs the protection of the consumer.
162     637.1004  Definitions.-For purposes of this chapter, the
163term:
164     (1)  "Appointment" means the authority given by an insurer
165to a licensee to transact insurance on behalf of an insurer.
166     (2)  "Attorney" as used in this part means an individual
167duly admitted to and a member in good standing of The Florida
168Bar.
169     (3)  "Agent in charge" of a title insurance agency means an
170attorney or a licensed and appointed title insurance agent who
171is responsible for escrow and policy issuance services of a
172title insurance agency location.
173     (4)  "Authorized" means provided authority pursuant to
174valid a certificate of authority issued by the department to
175transact insurance in this state.
176     (5)  "Closing services" means services performed by a
177licensed title insurer, title insurance agent or agency, or
178attorney agent in the agent's or agency's capacity as such,
179including, but not limited to, preparing documents necessary to
180close the transaction, conducting the closing, or handling the
181disbursing of funds related to the closing transaction in which
182a title insurance commitment or policy is to be issued.
183     (6)  "Commercially domiciled insurer" means every foreign
184or alien insurer that is authorized to do business in this state
185and that, during its 3 preceding fiscal years taken together, or
186during any lesser period of time if it has been licensed to
187transact its business in this state only for the lesser period
188of time, has written an average of 25 percent or more direct
189premiums in this state than it has written in its state of
190domicile during the same period, and the direct premiums written
191constitute more than 55 percent of its total direct premiums
192written everywhere in the United States during its 3 preceding
193fiscal years taken together, or during any lesser period of time
194if it has been authorized to transact its business in this state
195only for the lesser period of time, as reported in its most
196recent applicable annual or quarterly statements, shall be
197deemed a "commercially domiciled insurer" within this state.
198     (7)  "Consent" means authorized written agreement to
199supervision by the insurer.
200     (8)  "Department" means the Department of Financial
201Services. The term does not mean the Financial Services
202Commission or any office of the Financial Services Commission.
203     (9)  "Domestic," "foreign," and "alien" mean:
204     (a)  A "domestic" insurer is one formed under the laws of
205this state.
206     (b)  A "foreign" insurer is one formed under the laws of
207any state, district, territory, or commonwealth of the United
208States other than this state.
209     (c)  An "alien" insurer is an insurer other than a domestic
210or foreign insurer.
211     (10)  "Domicile," except as provided in s. 631.011, means:
212     (a)  As to Canadian insurers, Canada and the province under
213the laws of which the insurer was formed.
214     (b)  As to other alien insurers authorized to transact
215insurance in one or more states, the state designated by the
216insurer in writing filed with the department at the time of
217admission to this state or within 6 months after the effective
218date of this chapter, whichever date is the later, and may be
219any of the following states:
220     1.  That in which the insurer was first authorized to
221transact insurance if the insurer is still so authorized.
222     2.  That in which is located the insurer's principal place
223of business in the United States.
224     3.  That in which is held the larger deposit of trusteed
225assets of the insurer for the protection of its policyholders
226and creditors in the United States.
227If the insurer makes no such designation, its domicile shall be
228deemed to be that state in which is located its principal place
229of business in the United States.
230     (c)  As to alien insurers not authorized to transact
231insurance in one or more states, the country under the laws of
232which the insurer was formed.
233     (d)  As to all other insurers, the state under the laws of
234which the insurer was formed.
235     (11)  "Exceeded its powers" means the following conditions:
236     (a)  The insurer has refused to permit examination by the
237department of its books, papers, accounts, records, or business
238practices;
239     (b)  An insurer organized in this state has unlawfully
240removed from this state books, papers, accounts, or records
241necessary for an examination of the insurer by the department;
242     (c)  The insurer has failed to promptly comply with the
243applicable financial reporting statutes and department requests
244relating thereto;
245     (d)  The insurer has neglected or refused to observe an
246order of the department to correct a deficiency in its capital
247or surplus; or
248     (e)  The insurer has unlawfully or in violation of a
249department order:
250     1.  Totally reinsured its entire outstanding business; or
251     2.  Merged or consolidated substantially its entire
252property or business with another insurer.
253     (12)  "License" means a document issued by the department
254authorizing a person to transact insurance.
255     (13)(a)  "Managing general agent" means any person managing
256all or part of the insurance business of an insurer, including
257the management of a separate division, department, or
258underwriting office, and acting as an agent for that insurer,
259whether known as a managing general agent, manager, or other
260similar term, who, with or without authority, separately or
261together with affiliates, produces, directly or indirectly, or
262underwrites an amount of gross direct written premium equal to
263or more than 5 percent of the policyholder surplus as reported
264in the last annual statement of the insurer in any single
265quarter or year and also does one or more of the following:
266     1.  Adjusts or pays claims.
267     2.  Negotiates reinsurance on behalf of the insurer.
268     (b)  The following persons shall not be considered managing
269general agents:
270     1.  An employee of the insurer.
271     2.  A United States manager of the United States branch of
272an alien insurer.
273     3.  An underwriting manager managing all the insurance
274operations of the insurer pursuant to a contract who is
275under the common control of the insurer subject to regulation
276and whose compensation is not based on the volume of premiums
277written.
278     4.  The attorney in fact authorized by and acting for the
279subscribers of a reciprocal insurer under powers of attorney.
280     (14)  "Person" means an individual, insurer, company,
281association, organization, Lloyds, society, reciprocal insurer
282or interinsurance exchange, partnership, syndicate, business
283trust, corporation, agent, general agent, broker, service
284representative, adjuster, and every legal entity.
285     (15)  "Premium" means the charge, as specified by rule of
286the department, that is made by a title insurer for a title
287insurance policy, including the charge for performance of
288primary title services by a title insurer or title insurance
289agent or agency, and incurring the risks incident to such
290policy, under the several classifications of title insurance
291contracts and forms, and upon which charge a premium tax is paid
292under s. 624.509. As used in this part or in any other law, with
293respect to title insurance, the word "premium" does not include
294a commission.
295     (16)  "Primary title services" means determining
296insurability in accordance with sound underwriting practices
297based upon evaluation of a reasonable title search or a search
298of the records of a Uniform Commercial Code filing office and
299such other information as may be necessary, determination and
300clearance of underwriting objections and requirements to
301eliminate risk, preparation and issuance of a title insurance
302commitment setting forth the requirements to insure, and
303preparation and issuance of the policy. Such services do not
304include closing services or title searches, for which a separate
305charge or separate charges may be made.
306     (17)  When used in context signifying a jurisdiction other
307than the State of Florida, "state" means any state, district,
308territory, or commonwealth of the United States.
309     (18)  "Title insurance" means:
310     (a)  Insurance of owners of real property or others having
311an interest in real property or a contractual interest derived
312from real property, or liens or encumbrances on real property,
313against loss by encumbrance, or defective titles, or invalidity,
314or adverse claim to title; or
315     (b)  Insurance of owners and secured parties of the
316attachment, perfection, and priority of security interests in
317personal property under the Uniform Commercial Code.
318     (19)  "Title insurance agent" means a person appointed in
319writing by a title insurer to issue and countersign commitments
320or policies of title insurance on the title insurer's behalf.
321     (20)  "Title insurance agency" means an insurance agency as
322defined in s. 626.015 under which a title insurance agent or
323other employee determines insurability in accordance with
324underwriting rules and standards prescribed by the title insurer
325represented by the title insurance agency and issues and
326countersigns commitments, endorsements, or policies of title
327insurance on behalf of the appointing title insurer. The term
328does not include a title insurer.
329     (21)  "Title insurer" means any domestic company organized
330and authorized to do business under the provisions of this
331chapter, for the purpose of issuing title insurance, or any
332insurer organized under the laws of another state, the District
333of Columbia, or a foreign country and holding a certificate of
334authority to transact business in this state, for the purpose of
335issuing title insurance.
336     (22)  "Title search" means the compiling of title
337information from official or public records.
338     (23)  "Transact" means, with respect to insurance and in
339addition to other applicable provisions of this chapter:
340     (a)  Solicitation or inducement.
341     (b)  Preliminary negotiations.
342     (c)  Effectuation of a contract of insurance.
343     (d)  Transaction of matters subsequent to effectuation of a
344contract of insurance and arising out of it.
345     (24)  "Unsound condition" means that the department has
346determined that one or more of the following conditions exist
347with respect to an insurer:
348     (a)  The insurer's required surplus, capital, or capital
349stock is impaired to an extent prohibited by law;
350     (b)  The insurer continues to write new business when it
351has not maintained the required surplus or capital stock;
352     (c)  The insurer attempts to dissolve or liquidate without
353first having made provisions, satisfactory to the department,
354for liabilities arising from insurance policies issued by the
355insurer; or
356     (d)  The insurer meets one or more of the grounds in s.
357631.051 for the appointment of the department as receiver.
358     637.10045  Preemption to state.-The regulation of title
359insurance, title insurers, and title insurance agencies is
360preempted to the state.
361     637.1005  General applicability of other chapters.-
362     (1)  The provisions of chapters 624, 626, and 627 do not
363apply to title insurers or their agents unless specifically
364incorporated by reference and made applicable to this chapter by
365a provision of this chapter.
366     (2)  The provisions of chapters 625, 628, and 631 apply to
367title insurance and for purposes of applying such provisions to
368title insurance, the term "office" shall be interpreted to mean
369department and the term "Director of the Division of Insurance
370Regulation" shall be interpreted to mean the Chief Financial
371Officer.
372     637.1006  General powers; duties.-
373     (1)  The powers and duties of the Chief Financial Officer
374and the department specified in this chapter apply with respect
375to title insurers, title insurance agents, and title insurance
376agencies.
377     (2)  The department shall enforce the provisions of this
378chapter and shall execute the duties imposed upon the department
379by this chapter, as provided by law.
380     (3)  The department shall have the powers and authority
381expressly conferred upon it by, or reasonably implied from, the
382provisions of this chapter.
383     (4)  The department may conduct such investigations of
384insurance matters, in addition to investigations expressly
385authorized, as it may deem proper to determine whether any
386person has violated any provision of this chapter within its
387respective regulatory jurisdiction or to secure information
388useful in the lawful administration of any such provision. The
389cost of such investigations shall be borne by the state.
390     (5)  The department may collect, propose, publish, and
391disseminate information relating to the subject matter of any
392duties imposed upon it by law.
393     (6)  The department shall have such additional powers and
394duties as may be provided by other laws of this state.
395     (7)  The department may employ actuaries who shall be at-
396will employees and who shall serve at the pleasure of the Chief
397Financial Officer, in the case of department employees.
398Actuaries employed pursuant to this subsection shall be members
399of the Society of Actuaries or the Casualty Actuarial Society
400and shall be exempt from the Career Service System established
401under chapter 110. The salaries of the actuaries employed
402pursuant to this paragraph shall be set in accordance with s.
403216.251(2)(a)5. and shall be set at levels which are
404commensurate with salary levels paid to actuaries by the
405insurance industry.
406     (8)  The department shall, within existing resources,
407develop and implement an outreach program for the purpose of
408encouraging the entry of additional insurers into the Florida
409market.
410     (9)  Upon receiving service of legal process issued in any
411civil action or proceeding in this state against any regulated
412person required to appoint the Chief Financial Officer as its
413attorney to receive service of all legal process, the Chief
414Financial Officer, as attorney, may, in lieu of sending the
415process by registered or certified mail, send the process by any
416other verifiable means to the person last designated by the
417regulated person to receive the process.
418     (10)  This section does not limit the authority of the
419department and the Division of Insurance Fraud, as specified in
420s. 637.1046.
421     (11)  The department may enforce violations of the Real
422Estate Settlement Procedures Act, 12 U.S.C. ss. 2601 et seq.
423     637.1007  Rules.-
424     (1)  The department may adopt rules pursuant to ss.
425120.536(1) and 120.54 to implement provisions of this chapter
426and interpret the specific powers and duties provided in this
427chapter, which rules may:
428     (a)  Define the license and appointment requirements for
429title insurance agents and agencies.
430     (b)  Establish penalty guidelines for enforcing the
431requirements of this chapter.
432     (c)  Describe the fiduciary responsibilities of title
433insurance agents and agencies, including, but not limited to,
434duties related to escrow accounts.
435     (d)  Identify the responsibilities, duties, and
436designations of the agent in charge of the title insurance
437agency or the attorney in charge of an attorney-owned title
438insurance agency.
439     (e)  Enable the collection of information from agents and
440agencies relating to title insurance business.
441     (f)  Set reasonable requirements for the timely recording
442of documents and the delivery of final title policies.
443     (g)  Establish rules for the protection, calculation, and
444timely remittance of premiums that are owed to title insurers.
445     (h)  Prohibit the markup of the cost of any third-party
446services without adding value.
447     (2)  In addition to any other penalty provided, willful
448violation of any such rule shall subject the violator to such
449suspension or revocation of certificate of authority or license
450as may be applicable under this chapter as for violation of the
451provision as to which such rule relates.
452     637.1008  General penalty.-
453     (1)  Each willful violation of this chapter or rule of the
454department as to which a greater penalty is not provided by
455another provision of this chapter or rule of the department or
456by other applicable laws of this state is a misdemeanor of the
457second degree and is, in addition to any prescribed applicable
458denial, suspension, or revocation of certificate of authority,
459license, or permit, punishable as provided in s. 775.082 or s.
460775.083. Each instance of such violation shall be considered a
461separate offense.
462     (2)  Each willful violation of an emergency rule or order
463of the department by a person who is not licensed, authorized,
464or eligible to engage in business in accordance with this
465chapter is a felony of the third degree, punishable as provided
466in s. 775.082, s. 775.083, or s. 775.084. Each instance of such
467violation is a separate offense. This subsection does not apply
468to licensees or affiliated parties of licensees.
469     637.1009  Enforcement; cease and desist orders; removal of
470certain persons; fines.-
471     (1)  DEFINITIONS.-For the purposes of this section, the
472term:
473     (a)  "Affiliated party" means any person who directs or
474participates in the conduct of the affairs of a licensee and who
475is:
476     1.  A director, officer, employee, trustee, committee
477member, or controlling stockholder of a licensee or a subsidiary
478or service corporation of the licensee, other than a controlling
479stockholder which is a holding company, or an agent of a
480licensee or a subsidiary or service corporation of the licensee;
481     2.  A person who has filed or is required to file a
482statement or any other information required to be filed under s.
483628.461 or s. 628.4615;
484     3.  A stockholder, other than a stockholder that is a
485holding company of the licensee, who participates in the conduct
486of the affairs of the licensee; or
487     4.  An independent contractor who:
488     a.  Renders a written opinion required by the laws of this
489state under her or his professional credentials on behalf of the
490licensee, which opinion is reasonably relied on by the
491department in the performance of its duties; or
492     b.  Affirmatively and knowingly conceals facts, through a
493written misrepresentation to the department, with knowledge that
494such misrepresentation:
495     (I)  Constitutes a violation of this chapter or a lawful
496rule or order of the department; and
497     (II)  Directly and materially endangers the ability of the
498licensee to meet its obligations to policyholders.
499
500For the purposes of this subparagraph, any representation of
501fact made by an independent contractor on behalf of a licensee,
502affirmatively communicated as a representation of the licensee
503to the independent contractor, shall not be considered a
504misrepresentation by the independent contractor.
505     (b)  "Licensee" means a person issued a license or
506certificate of authority or approval under this chapter or a
507person registered under a provision of this chapter.
508     (2)  ENFORCEMENT GENERALLY.-
509     (a)  The powers granted by this section to the department
510apply only with respect to licensees of the department and their
511affiliated parties and to unlicensed persons subject to
512regulatory jurisdiction of the department.
513     (b)  The department may institute such suits or other legal
514proceedings as may be required to enforce any provision of this
515chapter within the department's regulatory jurisdiction. If it
516appears that any person has violated any provision of this
517chapter for which criminal prosecution is provided, the
518department shall provide the appropriate state attorney or other
519prosecuting agency having jurisdiction with respect to such
520prosecution with the relevant information in its possession.
521     (3)  CEASE AND DESIST ORDERS.-
522     (a)  The department may issue and serve a complaint stating
523charges upon any licensee or upon any affiliated party, whenever
524the department has reasonable cause to believe that the person
525or individual named therein is engaging in or has engaged in
526conduct that is:
527     1.  An act that demonstrates a lack of fitness or
528trustworthiness to engage in the business of insurance, is
529hazardous to the insurance buying public, or constitutes
530business operations that are a detriment to policyholders,
531stockholders, investors, creditors, or the public;
532     2.  A violation of any provision of this chapter;
533     3.  A violation of any rule of the department;
534     4.  A violation of any order of the department; or
535     5.  A breach of any written agreement with the department.
536     (b)  The complaint shall contain a statement of facts and
537notice of opportunity for a hearing pursuant to ss. 120.569 and
538120.57.
539     (c)  If no hearing is requested within the time allowed by
540ss. 120.569 and 120.57, or if a hearing is held and the
541department finds that any of the charges are proven, the
542department may enter an order directing the licensee or the
543affiliated party named in the complaint to cease and desist from
544engaging in the conduct complained of and take corrective action
545to remedy the effects of past improper conduct and assure future
546compliance.
547     (d)  If the licensee or affiliated party named in the order
548fails to respond to the complaint within the time allotted by
549ss. 120.569 and 120.57, the failure constitutes a default and
550justifies the entry of a cease and desist order.
551     (e)  A contested or default cease and desist order is
552effective when reduced to writing and served upon the licensee
553or affiliated party named therein. An uncontested cease and
554desist order is effective as agreed.
555     (f)  Whenever the department finds that conduct described
556in paragraph (a) is likely to cause insolvency, substantial
557dissipation or misvaluation of assets or earnings of the
558licensee, substantial inability to pay claims on a timely basis,
559or substantial prejudice to prospective or existing insureds,
560policyholders, subscribers, or the public, it may issue an
561emergency cease and desist order requiring the licensee or any
562affiliated party to immediately cease and desist from engaging
563in the conduct complained of and to take corrective and remedial
564action. The emergency order is effective immediately upon
565service of a copy of the order upon the licensee or affiliated
566party named therein and remains effective for 90 days. If the
567department begins nonemergency cease and desist proceedings
568under this subsection, the emergency order remains effective
569until the conclusion of the proceedings under ss. 120.569 and
570120.57.
571     (4)  REMOVAL OF AFFILIATED PARTIES.-
572     (a)  The department may issue and serve a complaint stating
573charges upon any affiliated party and upon the licensee
574involved, whenever the department has reason to believe that an
575affiliated party is engaging in or has engaged in conduct that
576constitutes:
577     1.  An act that demonstrates a lack of fitness or
578trustworthiness to engage in the business of insurance through
579engaging in illegal activity or mismanagement of business
580activities;
581     2.  A willful violation of any law relating to the business
582of insurance; however, if the violation constitutes a
583misdemeanor, no complaint shall be served as provided in this
584section until the affiliated party is notified in writing of the
585matter of the violation and has been afforded a reasonable
586period of time, as set forth in the notice, to correct the
587violation and has failed to do so;
588     3.  A violation of any other law involving fraud or moral
589turpitude that constitutes a felony;
590     4.  A willful violation of any rule of the department;
591     5.  A willful violation of any order of the department;
592     6.  A material misrepresentation of fact, made knowingly
593and willfully or made with reckless disregard for the truth of
594the matter; or
595     7.  An act of commission or omission or a practice which is
596a breach of trust or a breach of fiduciary duty.
597     (b)  The complaint shall contain a statement of facts and
598notice of opportunity for a hearing pursuant to ss. 120.569 and
599120.57.
600     (c)  If no hearing is requested within the time allotted by
601ss. 120.569 and 120.57, or if a hearing is held and the
602department finds that any of the charges in the complaint are
603proven true and that:
604     1.  The licensee has suffered or will likely suffer loss or
605other damage;
606     2.  The interests of the policyholders, creditors, or
607public are, or could be, seriously prejudiced by reason of the
608violation or act or breach of fiduciary duty;
609     3.  The affiliated party has received financial gain by
610reason of the violation, act, or breach of fiduciary duty; or
611     4.  The violation, act, or breach of fiduciary duty is one
612involving personal dishonesty on the part of the affiliated
613party or the conduct jeopardizes or could reasonably be
614anticipated to jeopardize the financial soundness of the
615licensee,
616
617The department may enter an order removing the affiliated party
618or restricting or prohibiting participation by the person in the
619affairs of that particular licensee or of any other licensee.
620     (d)  If the affiliated party fails to respond to the
621complaint within the time allotted by ss. 120.569 and 120.57,
622the failure constitutes a default and justifies the entry of an
623order of removal, suspension, or restriction.
624     (e)  A contested or default order of removal, restriction,
625or prohibition is effective when reduced to writing and served
626on the licensee and the affiliated party. An uncontested order
627of removal, restriction, or prohibition is effective as agreed.
628     (f)1.  The chief executive officer, or the person holding
629the equivalent office, of a licensee shall promptly notify the
630department that issued the license if she or he has actual
631knowledge that any affiliated party is charged with a felony in
632a state or federal court.
633     2.  Whenever any affiliated party is charged with a felony
634in a state or federal court or with the equivalent of a felony
635in the courts of any foreign country with which the United
636States maintains diplomatic relations, and the charge alleges
637violation of any law involving fraud, theft, or moral turpitude,
638the department may enter an emergency order suspending the
639affiliated party or restricting or prohibiting participation by
640the affiliated party in the affairs of the particular licensee
641or of any other licensee upon service of the order upon the
642licensee and the affiliated party charged. The order shall
643contain notice of opportunity for a hearing pursuant to ss.
644120.569 and 120.57, where the affiliated party may request a
645postsuspension hearing to show that continued service to or
646participation in the affairs of the licensee does not pose a
647threat to the interests of the licensee's policyholders or
648creditors and does not threaten to impair public confidence in
649the licensee. In accordance with applicable rules, the
650department shall notify the affiliated party whether the order
651suspending or prohibiting the person from participation in the
652affairs of a licensee will be rescinded or otherwise modified.
653The emergency order remains in effect, unless otherwise modified
654by the department, until the criminal charge is disposed of. The
655acquittal of the person charged, or the final, unappealed
656dismissal of all charges against the person, dissolves the
657emergency order, but does not prohibit the department from
658instituting proceedings under paragraph (a). If the person
659charged is convicted or pleads guilty or nolo contendere,
660whether or not an adjudication of guilt is entered by the court,
661the emergency order shall become final.
662     (g)  Any affiliated party removed from office pursuant to
663this section is not eligible for reelection or appointment to
664the position or to any other official position in any licensee
665in this state except upon the written consent of the department.
666Any affiliated party who is removed, restricted, or prohibited
667from participation in the affairs of a licensee pursuant to this
668section may petition the department for modification or
669termination of the removal, restriction, or prohibition.
670     (h)  Resignation or termination of an affiliated party does
671not affect the department's jurisdiction to proceed under this
672subsection.
673     (5)  ADMINISTRATIVE FINES; ENFORCEMENT.-
674     (a)  The department, in a proceeding initiated pursuant to
675chapter 120, may impose an administrative fine against any
676person found in the proceeding to have violated any provision of
677this chapter, a cease and desist order of the department, or any
678written agreement with the department. A proceeding may not be
679initiated and a fine may not accrue until after the person has
680been notified in writing of the nature of the violation and has
681been afforded a reasonable period of time, as set forth in the
682notice, to correct the violation and has failed to do so.
683     (b)  A fine imposed under this subsection may not exceed
684the amounts specified in s. 637.2021, per violation.
685     (c)  In addition to the imposition of an administrative
686fine under this subsection, the department may also suspend or
687revoke the license or certificate of authority of the licensee
688fined under this subsection.
689     (d)  Any administrative fine levied by the department under
690this subsection may be enforced by the department by appropriate
691proceedings in the circuit court of the county in which the
692person resides or in which the principal office of a licensee is
693located, or, in the case of a foreign insurer or person not
694residing in this state, in Leon County. In any administrative or
695judicial proceeding arising under this section, a party may
696elect to correct the violation asserted by the department, and,
697upon doing so, any fine shall cease to accrue; however, the
698election to correct the violation does not render any
699administrative or judicial proceeding moot. All fines collected
700under this section shall be paid to the Title Insurance
701Regulatory Trust Fund.
702     (e)  In imposing any administrative penalty or remedy
703provided for under this section, the department shall take into
704account the appropriateness of the penalty with respect to the
705size of the financial resources and the good faith of the person
706charged, the gravity of the violation, the history of previous
707violations, and other matters as justice may require.
708     (f)  The imposition of an administrative fine under this
709subsection may be in addition to any other penalty or
710administrative fine authorized under this chapter.
711     (6)  ADMINISTRATIVE PROCEDURES.-All administrative
712proceedings under subsections (3), (4), and (5) shall be
713conducted in accordance with chapter 120. Any service required
714or authorized to be made by the department under this chapter
715shall be made by certified mail, return receipt requested,
716delivered to the addressee only; by personal delivery; or in
717accordance with chapter 48. The service provided for herein
718shall be effective from the date of delivery.
719     (7)  CRIMINAL ENFORCEMENT.-It is unlawful for any
720affiliated party who is removed or prohibited from participation
721in the affairs of a licensee pursuant to this section, or for
722any licensee whose rights or privileges under such license have
723been suspended or revoked pursuant to this chapter, to knowingly
724act as an affiliated party as defined in this section or to
725knowingly transact insurance until expressly authorized to do so
726by the department. Such authorization by the department may not
727be provided unless the affiliated party or the licensee has made
728restitution, if applicable, to all parties damaged by the
729actions of the affiliated party or the licensee which served as
730the basis for the removal or prohibition of the affiliated party
731or the suspension or revocation of the rights and privileges of
732the licensee. Any person who violates the provisions of this
733subsection commits a felony of the third degree, punishable as
734provided in s. 775.082, s. 775.083 or s. 775.084.
735     637.1011  Immunity from civil liability for providing
736department with information about condition of insurer.-A
737person, other than a person filing a required report or other
738required information, who provides the department with
739information about the financial condition of an insurer is
740immune from civil liability arising out of the provision of the
741information unless the person acted with knowledge that the
742information was false or with reckless disregard for the truth
743or falsity of the information.
744     637.1012  Records; reproductions; destruction.-
745     (1)  Except as provided in this section, the department
746shall each preserve in permanent form records of its
747proceedings, hearings, investigations, and examinations and
748shall file such records in its department.
749     (2)  The department may photograph, microphotograph, or
750reproduce on film, or maintain in an electronic recordkeeping
751system, all financial records, financial statements of domestic
752insurers, reports of business transacted in this state by
753foreign insurers and alien insurers, reports of examination of
754domestic insurers, and such other records and documents on file
755in the department as the department may in its discretion
756select.
757     (3)  To facilitate the efficient use of floor space and
758filing equipment in its offices, the department may destroy the
759following records and documents pursuant to chapter 257:
760     (a)  General closed correspondence files over 3 years old.
761     (b)  Title insurance and similar license files, over 2
762years old; except that the department shall preserve by
763reproduction or otherwise a copy of the original records upon
764the basis of which each such licensee qualified for her or his
765initial license, except a competency examination, and of any
766disciplinary proceeding affecting the licensee.
767     (c)  All title insurance agent and similar license files
768and records, including original license qualification records
769and records of disciplinary proceedings 5 years after a licensee
770has ceased to be qualified for a license.
771     (d)  Insurer certificate of authority files over 2 years
772old, except that the department shall preserve by reproduction
773or otherwise a copy of the initial certificate of authority of
774each insurer.
775     (e)  All documents and records which have been photographed
776or otherwise reproduced as provided in subsection (2), if such
777reproductions have been filed and an audit of the department has
778been completed for the period embracing the dates of such
779documents and records.
780     (f)  All other records, documents, and files not expressly
781provided for in paragraphs (a)-(e).
782     637.1013  Reproductions and certified copies of records as
783evidence.-
784     (1)  Photographs or microphotographs in the form of film or
785prints, or other reproductions from an electronic recordkeeping
786system, of documents and records made under s. 637.1012(2), or
787made under former s. 624.311(3) before October 1, 1982, shall
788have the same force and effect as the originals thereof and
789shall be treated as originals for the purpose of their
790admissibility in evidence. Duly certified or authenticated
791reproductions of such photographs, microphotographs, or other
792reproductions from an electronic recordkeeping system shall be
793as admissible in evidence as the originals.
794     (2)  Upon the request of any person and payment of the
795applicable fee, the department shall give a certified copy of
796any record in its department which is then subject to public
797inspection.
798     (3)  Copies of original records or documents in its
799department certified by the department shall be received in
800evidence in all courts as if they were originals.
801     637.1014  Publications.-
802     (1)  As early as reasonably possible, the department shall
803annually have printed and made available a statistical report
804which must include all of the following information on either a
805calendar year or fiscal year basis:
806     (a)  The total amount of premiums written and earned for
807title insurance.
808     (b)  The total amount of losses paid and losses incurred
809for title insurance.
810     (c)  The ratio of premiums written to losses paid by title
811insurance.
812     (d)  The ratio of premiums earned to losses incurred by
813title insurance.
814     (e)  The market share of the 10 largest insurers or insurer
815groups of title insurance and of each insurer or insurer group
816that has a market share of at least 1 percent of a line of
817insurance in this state.
818     (f)  The profitability of title insurance.
819     (g)  An analysis of the impact of the insurance industry on
820the economy of the state.
821     (h)  A complaint ratio by line of insurance for the
822insurers referred to in paragraph (e), based upon information
823provided to the department by the department. The department
824shall determine the most appropriate ratio or ratios for
825quantifying complaints.
826     (i)  A summary of the findings of market examinations
827performed by the department under s. 637.1018 during the
828preceding year.
829     (j)  Such other information as the department deems
830relevant.
831     (2)  The department may prepare and have printed and
832published in pamphlet or book form, as needed, questions and
833answers for the use of persons applying for an examination for
834licensing as title insurance agents.
835     (3)  The department shall sell the publications mentioned
836in subsections (1) and (2) to purchasers at a price fixed by the
837department at not less than the cost of printing and binding
838such publications, plus packaging and postage costs for mailing;
839except that the department may deliver copies of such
840publications free of cost to state agencies and officers;
841insurance supervisory authorities of other states and
842jurisdictions; institutions of higher learning located in
843Florida; the Library of Congress; insurance officers of Naval,
844Military, and Air Force bases located in this state; and to
845persons serving as advisers to the department in preparation of
846the publications.
847     (4)  The department may contract with outside vendors, in
848accordance with chapter 287, to compile data in an electronic
849data processing format that is compatible with the systems of
850the department.
851     637.1015  Sale of publications; deposit of proceeds.-The
852department shall deposit all moneys received from the sale of
853publications under s. 637.1014 in the Title Insurance Regulatory
854Trust Fund for the purpose of paying costs for the preparation,
855printing, and delivery of the publications required in s.
856637.1014(2), packaging and mailing costs, and banking,
857accounting, and incidental expenses connected with the sale and
858delivery of such publications. All moneys deposited into and all
859funds transferred to the Title Insurance Regulatory Trust Fund
860are appropriated for such uses and purposes.
861     637.1016  Department; annual report.-
862     (1)  As early as reasonably possible, the department shall
863annually prepare a report to the Speaker and Minority Leader of
864the House of Representatives, the President and Minority Leader
865of the Senate, the chairs of the legislative committees with
866jurisdiction over matters of insurance, and the Governor
867showing, with respect to the preceding calendar year:
868     (a)  Names of the authorized insurers transacting insurance
869in this state, with abstracts of their financial statements
870including assets, liabilities, and net worth.
871     (b)  Names of insurers whose business was closed during the
872year, the cause thereof, and amounts of assets and liabilities
873as ascertainable.
874     (c)  Names of insurers against which delinquency or similar
875proceedings were instituted, and a concise statement of the
876circumstances and results of each such proceeding.
877     (d)  The receipts and estimated expenses of the department
878for the year.
879     (e)  Such other pertinent information and matters as the
880department deems to be in the public interest.
881     (f)  Annually after each regular session of the
882Legislature, a compilation of the laws of this state relating to
883insurance. Any such publication may be printed, revised, or
884reprinted upon the basis of the original low bid.
885     (g)  An analysis and summary report of the state of the
886insurance industry in this state evaluated as of the end of the
887most recent calendar year.
888     (2)  The department shall maintain the following
889information and make such information available upon request:
890     (a)  Calendar year profitability, including investment
891income from loss reserves (Florida and countrywide).
892     (b)  Aggregate Florida loss reserves.
893     (c)  Premiums written (Florida and countrywide).
894     (d)  Premiums earned (Florida and countrywide).
895     (e)  Incurred losses (Florida and countrywide).
896     (f)  Paid losses (Florida and countrywide).
897     (g)  Allocated Florida loss adjustment expenses.
898     (h)  Variation of premiums charged by the industry as
899compared to rates promulgated by the Insurance Services Office
900(Florida and countrywide).
901     (i)  An analysis of policy size limits (Florida and
902countrywide).
903     (j)  Trends; emerging trends as exemplified by the
904percentage change in frequency and severity of both paid and
905incurred claims, and pure premium (Florida and countrywide).
906     (3)  The department may contract with outside vendors, in
907accordance with chapter 287, to compile data in an electronic
908data processing format that is compatible with the systems of
909the department.
910     637.1017  Examination of insurers.-
911     (1)(a)  The department shall examine the affairs,
912transactions, accounts, records, and assets of each authorized
913insurer as to its transactions affecting the insurer as often as
914it deems advisable, except as provided in this section. The
915examination may include examination of the affairs,
916transactions, accounts, and records relating directly or
917indirectly to the insurer and of the assets of the insurer's
918managing general agents and controlling or controlled person, as
919defined in s. 625.012. The examination shall be pursuant to a
920written order of the department. Such order shall expire upon
921receipt by the department of the written report of the
922examination.
923     (b)  The department shall examine each insurer according to
924accounting procedures designed to fulfill the requirements of
925generally accepted insurance accounting principles and practices
926and good internal control and in keeping with generally accepted
927accounting forms, accounts, records, methods, and practices
928relating to insurers. To facilitate uniformity in examinations,
929the department may adopt, by rule, the Market Conduct Examiners
930Handbook and the Financial Condition Examiners Handbook of the
931National Association of Insurance Commissioners, 2002, and may
932adopt subsequent amendments thereto, if the examination
933methodology remains substantially consistent.
934     (2)(a)  Except as provided in paragraph (f), the department
935may examine each insurer as often as may be warranted for the
936protection of the policyholders and in the public interest, and
937shall examine each domestic insurer not less frequently than
938once every 5 years. The examination shall cover the preceding 5
939fiscal years of the insurer and shall be commenced within 12
940months after the end of the most recent fiscal year being
941covered by the examination. The examination may cover any period
942of the insurer's operations since the last previous examination.
943The examination may include examination of events subsequent to
944the end of the most recent fiscal year and the events of any
945prior period that affect the present financial condition of the
946insurer.
947     (b)  The department shall examine each insurer applying for
948an initial certificate of authority to transact insurance in
949this state before granting the initial certificate.
950     (c)  In lieu of making its own examination, the department
951may accept a full report of the last recent examination of a
952foreign insurer, certified to by the insurance supervisory
953official of another state.
954     (d)  The examination by the department of an alien insurer
955shall be limited to the alien insurer's insurance transactions
956and affairs in the United States, except as otherwise required
957by the department.
958     (e)  The department shall adopt rules providing that an
959examination under this section may be conducted by independent
960certified public accountants, actuaries, investment specialists,
961information technology specialists, and reinsurance specialists
962meeting criteria specified by rule. The rules shall provide:
963     1.  That the rates charged to the insurer being examined
964are consistent with rates charged by other firms in a similar
965profession and are comparable with the rates charged for
966comparable examinations.
967     2.  That the firm selected by the department to perform the
968examination has no conflicts of interest that might affect its
969ability to independently perform its responsibilities on the
970examination.
971     3.  That the insurer being examined must make payment for
972the examination pursuant to s. 637.1023(1) in accordance with
973the rates and terms established by the department and the firm
974performing the examination.
975     (f)  An examination under this section must be conducted at
976least once every year with respect to a domestic insurer that
977has continuously held a certificate of authority for less than 3
978years. The examination must cover the preceding fiscal year or
979the period since the last examination of the insurer. The
980department may limit the scope of the examination.
981     637.1018  Market conduct examinations.-
982     (1)  As often as it deems necessary, the department shall
983examine each licensed rating organization, each advisory
984organization, each group, association, carrier, as defined in s.
985440.02, or other organization of insurers which engages in joint
986underwriting or joint reinsurance, and each authorized insurer
987transacting in this state any class of insurance to which the
988provisions of this chapter are applicable. The examination shall
989be for the purpose of ascertaining compliance by the person
990examined with the applicable provisions of this chapter.
991     (2)  In lieu of any such examination, the department may
992accept the report of a similar examination made by the insurance
993supervisory official of another state.
994     (3)  The examination may be conducted by an independent
995professional examiner under contract to the department, in which
996case payment shall be made directly to the contracted examiner
997by the insurer examined in accordance with the rates and terms
998agreed to by the department and the examiner.
999     (4)  The reasonable cost of the examination shall be paid
1000by the person examined, and such person shall be subject, as
1001though an insurer, to the provisions of s. 637.1023.
1002     (5)  Such examinations shall also be subject to the
1003applicable provisions of chapter 440 and ss. 637.1021, 637.1022,
1004637.1024, and 637.1025.
1005     637.1019  Investigation of title insurance agents and
1006others.-If the department has reason to believe that any title
1007insurance agent has violated or is violating any provision of
1008this chapter, or upon the written complaint signed by any
1009interested person indicating that any such violation may exist:
1010     (1)  The department shall conduct such investigation as it
1011deems necessary of the accounts, records, documents, and
1012transactions pertaining to or affecting the insurance affairs of
1013any title insurance agent, title insurance agency, or other
1014person subject to its jurisdiction.
1015     (2)  The department shall conduct such investigation as it
1016deems necessary of the accounts, records, documents, and
1017transactions pertaining to or affecting the insurance affairs of
1018any:
1019     (a)  Person subject to its jurisdiction.
1020     (b)  Person having a contract or power of attorney under
1021which she or he enjoys in fact the exclusive or dominant right
1022to manage or control an insurer.
1023     (c)  Person engaged in or proposing to be engaged in the
1024promotion or formation of:
1025     1.  A domestic insurer;
1026     2.  An insurance holding corporation; or
1027     3.  A corporation to finance a domestic insurer or in the
1028production of the domestic insurer's business.
1029     (3)  In the investigation by the department of the alleged
1030misconduct, the licensee shall, whenever required by the
1031department, cause his or her books and records to be open for
1032inspection for the purpose of such inquiries.
1033     (4)  A complaint against any licensee may be informally
1034alleged and need not be in any language necessary to charge a
1035crime on an indictment or information.
1036     (5)  The expense for any hearings or investigations under
1037this section, as well as the fees and mileage of witnesses, may
1038be paid out of the appropriate fund.
1039     (6)  If the department, after investigation, has reason to
1040believe that a licensee may have been found guilty of or pleaded
1041guilty or nolo contendere to a felony or a crime related to the
1042business of insurance in this or any other state or jurisdiction,
1043the department or office may require the licensee to file with
1044the department or office a complete set of his or her
1045fingerprints, which shall be accompanied by the fingerprint
1046processing fee set forth in s. 637.2031. The fingerprints shall
1047be taken by an authorized law enforcement agency or other
1048department-approved entity.
1049     637.1021  Conduct of examination or investigation; access
1050to records; correction of accounts; appraisals.-
1051     (1)  The examination or investigation may be conducted by
1052the accredited examiners or investigators of the department at
1053the offices wherever located of the person being examined or
1054investigated and at such other places as may be required for
1055determination of matters under examination or investigation. In
1056the case of alien insurers, the examination may be so conducted
1057in the insurer's offices and places in the United States, except
1058as otherwise required by the department.
1059     (2)  Every person being examined or investigated, and its
1060officers, attorneys, employees, agents, and representatives,
1061shall make freely available to the department or its examiners
1062or investigators the accounts, records, documents, files,
1063information, assets, and matters in their possession or control
1064relating to the subject of the examination or investigation. An
1065agent who provides other products or services or maintains
1066customer information not related to insurance must maintain
1067records relating to insurance products and transactions
1068separately if necessary to give the department access to such
1069records. If records relating to the insurance transactions are
1070maintained by an agent on premises owned or operated by a third
1071party, the agent and the third party must provide access to the
1072records by the department.
1073     (3)  If the department finds any accounts or records to be
1074inadequate, or inadequately kept or posted, it may employ
1075experts to reconstruct, rewrite, post, or balance them at the
1076expense of the person being examined if such person has failed
1077to maintain, complete, or correct such records or accounting
1078after the department has given her or him notice and a
1079reasonable opportunity to do so.
1080     (4)  If the department deems it necessary to value any
1081asset involved in such an examination of an insurer, it may make
1082written request of the insurer to designate one or more
1083competent appraisers acceptable to the department, who shall
1084promptly make an appraisal of the asset and furnish a copy
1085thereof to the department. If the insurer fails to designate
1086such an appraiser or appraisers within 20 days after the request
1087of the department, the department may designate the appraiser or
1088appraisers. The reasonable expense of any such appraisal shall
1089be a part of the expense of examination, to be borne by the
1090insurer.
1091     (5)  Neither the department nor any examiner shall remove
1092any record, account, document, file, or other property of the
1093person being examined from the offices of such person except
1094with the written consent of such person given in advance of such
1095removal or pursuant to an order of court duly obtained.
1096     (6)  Any individual who willfully obstructs the department
1097or the examiner in the examinations or investigations authorized
1098by this part is guilty of a misdemeanor and upon conviction
1099shall be punished as provided in s. 624.15.
1100     (7)  The department or its examiners or investigators may
1101electronically scan accounts, records, documents, files, and
1102information, relating to the subject of the examination or
1103investigation, in the possession or control of the person being
1104examined or investigated.
1105     637.1022  Examination and investigation reports.-
1106     (1)  The department or its examiner shall make a full and
1107true written report of each examination. The examination report
1108shall contain only information obtained from examination of the
1109records, accounts, files, and documents of or relative to the
1110insurer examined or from testimony of individuals under oath,
1111together with relevant conclusions and recommendations of the
1112examiner based thereon. The department shall furnish a copy of
1113the examination report to the insurer examined not less than 30
1114days prior to filing the examination report in its office. If
1115such insurer so requests in writing within such 30-day period,
1116the department shall grant a hearing with respect to the
1117examination report and shall not so file the examination report
1118until after the hearing and after such modifications have been
1119made therein as the department deems proper.
1120     (2)  The examination report when so filed shall be
1121admissible in evidence in any action or proceeding brought by
1122the department against the person examined, or against its
1123officers, employees, or agents. In all other proceedings, the
1124admissibility of the examination report is governed by the
1125evidence code. The department or its examiners may at any time
1126testify and offer other proper evidence as to information
1127secured or matters discovered during the course of an
1128examination, whether or not a written report of the examination
1129has been either made, furnished, or filed with the department.
1130     (3)  After the examination report has been filed pursuant
1131to subsection (1), the department may publish the results of any
1132such examination in one or more newspapers published in this
1133state whenever it deems it to be in the public interest.
1134     (4)  After the examination report of an insurer has been
1135filed pursuant to subsection (1), an affidavit shall be filed
1136with the department, not more than 30 days after the report has
1137been filed, on a form furnished by the department and signed by
1138the officer of the company in charge of the insurer's business
1139in this state, stating that she or he has read the report and
1140that the recommendations made in the report will be considered
1141within a reasonable time.
1142     637.1023  Examination expenses.-
1143     (1)  Each insurer so examined shall pay to the department
1144the expenses of the examination at the rates adopted by the
1145department. Such expenses shall include actual travel expenses,
1146reasonable living expense allowance, compensation of the
1147examiner or other person making the examination, and necessary
1148attendant administrative costs of the department directly
1149related to the examination. Such travel expense and living
1150expense allowance shall be limited to those expenses necessarily
1151incurred on account of the examination and shall be paid by the
1152examined insurer together with compensation upon presentation by
1153the department to such insurer of a detailed account of such
1154charges and expenses after a detailed statement has been filed
1155by the examiner and approved by the department.
1156     (2)  All moneys collected from insurers for examinations
1157shall be deposited into the Title Insurance Regulatory Trust
1158Fund, and the department may make deposits from time to time
1159into such fund from moneys appropriated for the operation of the
1160department.
1161     (3)  Notwithstanding the provisions of s. 112.061, the
1162department may pay to the examiner or person making the
1163examination out of such trust fund the actual travel expenses,
1164reasonable living expense allowance, and compensation in
1165accordance with the statement filed with the department by the
1166examiner or other person, as provided in subsection (1) upon
1167approval by the department.
1168     (4)  When not examining an insurer, the travel expenses,
1169per diem, and compensation for the examiners and other persons
1170employed to make examinations, if approved, shall be paid out of
1171moneys budgeted for such purpose as regular employees,
1172reimbursements for such travel expenses and per diem to be at
1173rates no more than as provided in s. 112.061.
1174     (5)  The department may pay to regular insurance examiners,
1175not residents of Leon County, Florida, per diem for periods not
1176exceeding 30 days for each such examiner while at the Department
1177of Financial Services in Tallahassee, Florida, for the purpose
1178of auditing insurers' annual statements. Such expenses shall be
1179paid out of moneys budgeted for such purpose, as for regular
1180employees at rates provided in s. 112.061.
1181     (6)  The provisions of this section shall apply to rate
1182analysts and rate examiners in the discharge of their duties
1183under s. 637.1018.
1184     637.1024  Witnesses and evidence.-
1185     (1)  As to any examination, investigation, or hearing being
1186conducted under this chapter, a person designated by the
1187department:
1188     (a)  May administer oaths, examine and cross-examine
1189witnesses, receive oral and documentary evidence.
1190     (b)  May subpoena witnesses, compel their attendance and
1191testimony, and require by subpoena the production of books,
1192papers, records, files, correspondence, documents, or other
1193evidence which is relevant to the inquiry.
1194     (2)  If any person refuses to comply with any such subpoena
1195or to testify as to any matter concerning which she or he may be
1196lawfully interrogated, the Circuit Court of Leon County or of
1197the county wherein such examination, investigation, or hearing
1198is being conducted, or of the county wherein such person
1199resides, may, on the application of the department, issue an
1200order requiring such person to comply with the subpoena and to
1201testify.
1202     (3)  Subpoenas shall be served, and proof of such service
1203made, in the same manner as if issued by a circuit court.
1204Witness fees, cost, and reasonable travel expenses, if claimed,
1205shall be allowed the same as for testimony in a circuit court.
1206     637.1025  Testimony compelled; immunity from prosecution.-
1207     (1)  If any natural person asks to be excused from
1208attending or testifying or from producing any books, papers,
1209records, contracts, documents, or other evidence in connection
1210with any examination, hearing, or investigation being conducted
1211by the department or its examiner, on the ground that the
1212testimony or evidence required of her or him may tend to
1213incriminate the person or subject her or him to a penalty or
1214forfeiture, and shall notwithstanding be directed to give such
1215testimony or produce such evidence, the person must, if so
1216directed by the department and the Department of Legal Affairs,
1217nonetheless comply with such direction; but she or he shall not
1218thereafter be prosecuted or subjected to any penalty or
1219forfeiture for or on account of any transaction, matter, or
1220thing concerning which she or he may have so testified or
1221produced evidence; and no testimony so given or evidence
1222produced shall be received against the person upon any criminal
1223action, investigation, or proceeding. However, no such person so
1224testifying shall be exempt from prosecution or punishment for
1225any perjury committed by her or him in such testimony, and the
1226testimony or evidence so given or produced shall be admissible
1227against her or him upon any criminal action, investigation, or
1228proceeding concerning such perjury. No license or permit
1229conferred or to be conferred to such person shall be refused,
1230suspended, or revoked based upon the use of such testimony.
1231     (2)  Any such individual may execute, acknowledge, and file
1232with the department, as appropriate, a statement expressly
1233waiving such immunity or privilege in respect to any
1234transaction, matter, or thing specified in such statement; and
1235thereupon the testimony of such individual or such evidence in
1236relation to such transaction, matter, or thing may be received
1237or produced before any judge or justice, court, tribunal, grand
1238jury, or otherwise; and, if so received or produced, such
1239individual shall not be entitled to any immunity or privileges
1240on account of any testimony she or he may so give or evidence so
1241produced.
1242     637.1026  Hearings.-The department may hold hearings for
1243any purpose within the scope of this chapter deemed to be
1244necessary.
1245     637.1027  Authority of Department of Law Enforcement to
1246accept fingerprints of, and exchange criminal history records
1247with respect to, certain persons.-
1248     (1)  The Department of Law Enforcement may accept
1249fingerprints of organizers, incorporators, subscribers,
1250officers, stockholders, directors, or any other persons
1251involved, directly or indirectly, in the organization,
1252operation, or management of:
1253     (a)  Any insurer or proposed insurer transacting or
1254proposing to transact insurance in this state.
1255     (b)  Any other entity which is examined or investigated or
1256which is eligible to be examined or investigated under the
1257provisions of this chapter.
1258     (2)  The Department of Law Enforcement may accept
1259fingerprints of individuals who apply for a license as a title
1260insurance agent, service representative, or managing general
1261agent or the fingerprints of the majority owner, sole
1262proprietor, partners, officers, and directors of a corporation
1263or other legal entity that applies for licensure with the
1264department under the provisions of this chapter.
1265     (3)  The Department of Law Enforcement may, to the extent
1266provided for by federal law, exchange state, multistate, and
1267federal criminal history records with the department for the
1268purpose of the issuance, denial, suspension, or revocation of a
1269certificate of authority, certification, or license to operate
1270in this state.
1271     (4)  The Department of Law Enforcement may accept
1272fingerprints of any other person required by statute or rule to
1273submit fingerprints to the department or any applicant or
1274licensee regulated by the department who is required to
1275demonstrate that he or she has not been convicted of or pled
1276guilty or nolo contendere to a felony or a misdemeanor.
1277     (5)  The Department of Law Enforcement shall, upon receipt
1278of fingerprints from the department, submit the fingerprints to
1279the Federal Bureau of Investigation to check federal criminal
1280history records.
1281     (6)  Statewide criminal records obtained through the
1282Department of Law Enforcement, federal criminal records obtained
1283through the Federal Bureau of Investigation, and local criminal
1284records obtained through local law enforcement agencies shall be
1285used by the department for the purpose of issuance, denial,
1286suspension, or revocation of certificates of authority,
1287certifications, or licenses issued to operate in this state.
1288     637.1029  Declaration of purpose.-The purpose of ss.
1289637.1029-637.1049 is to regulate trade practices relating to the
1290business of title insurance in accordance with the intent of
1291Congress as expressed in the Act of Congress of March 9, 1945
1292(Pub. L. No. 15, 79th Congress), by defining, or providing for
1293the determination of, all such practices in this state which
1294constitute unfair methods of competition or unfair or deceptive
1295acts or practices and by prohibiting the trade practices so
1296defined or determined.
1297     637.1031  Definitions.-When used in ss. 637.1029-637.1049,
1298the term "insurance policy" or "insurance contract" means a
1299written contract of, or a written agreement for or effecting,
1300insurance, or the certificate thereof, by whatever name called,
1301and includes all clauses, riders, endorsements, and papers which
1302are a part thereof.
1303     637.1032  Unfair methods of competition and unfair or
1304deceptive acts or practices prohibited; penalties.-
1305     (1)  A person may not engage in this state in any trade
1306practice which is defined in ss. 637.1029-637.1049 as, or
1307determined pursuant to s. 637.1029 or s. 637.1035 to be, an
1308unfair method of competition or an unfair or deceptive act or
1309practice involving the business of insurance.
1310     (2)  Any person who violates any provision of ss. 637.1029-
1311637.1049 shall be subject to a fine in an amount not greater
1312than $2,500 for each nonwillful violation and not greater than
1313$20,000 for each willful violation. Fines under this subsection
1314may not exceed an aggregate amount of $10,000 for all nonwillful
1315violations arising out of the same action or an aggregate amount
1316of $100,000 for all willful violations arising out of the same
1317action. The fines authorized by this subsection may be imposed
1318in addition to any other applicable penalty.
1319     637.1033  Unfair methods of competition and unfair or
1320deceptive acts or practices defined.-The following are defined
1321as unfair methods of competition and unfair or deceptive acts or
1322practices:
1323     (1)  Misrepresentations and false advertising of insurance
1324policies.-Knowingly making, issuing, circulating, or causing to
1325be made, issued, or circulated, any estimate, illustration,
1326circular, statement, sales presentation, omission, or comparison
1327which:
1328     (a)  Misrepresents the benefits, advantages, conditions, or
1329terms of any insurance policy.
1330     (b)  Uses any name or title of any insurance policy or
1331class of insurance policies misrepresenting the true nature
1332thereof.
1333     (c)  Is a misrepresentation for the purpose of inducing, or
1334tending to induce, the lapse, forfeiture, exchange, conversion,
1335or surrender of any insurance policy.
1336     (2)  False information and advertising generally.-Knowingly
1337making, publishing, disseminating, circulating, or placing
1338before the public, or causing, directly or indirectly, to be
1339made, published, disseminated, circulated, or placed before the
1340public:
1341     (a)  In a newspaper, magazine, or other publication,
1342     (b)  In the form of a notice, circular, pamphlet, letter,
1343or poster,
1344     (c)  Over any radio or television station, or
1345     (d)  In any other way,
1346
1347an advertisement, announcement, or statement containing any
1348assertion, representation, or statement with respect to the
1349business of insurance, which is untrue, deceptive, or
1350misleading.
1351     (3)  Defamation.-Knowingly making, publishing,
1352disseminating, or circulating, directly or indirectly, or
1353aiding, abetting, or encouraging the making, publishing,
1354disseminating, or circulating of, any oral or written statement,
1355or any pamphlet, circular, article, or literature, which is
1356false or maliciously critical of, or derogatory to, any person
1357and which is calculated to injure such person.
1358     (4)  Boycott, coercion, and intimidation.-Entering into any
1359agreement to commit, or by any concerted action committing, any
1360act of boycott, coercion, or intimidation resulting in, or
1361tending to result in, unreasonable restraint of, or monopoly in,
1362the business of insurance.
1363     (5)  False statements and entries.-
1364     (a)  Knowingly:
1365     1.  Filing with any supervisory or other public official,
1366     2.  Making, publishing, disseminating, circulating,
1367     3.  Delivering to any person,
1368     4.  Placing before the public,
1369     5.  Causing, directly or indirectly, to be made, published,
1370disseminated, circulated, delivered to any person, or placed
1371before the public,
1372
1373any false material statement.
1374     (b)  Knowingly making any false entry of a material fact in
1375any book, report, or statement of any person, or knowingly
1376omitting to make a true entry of any material fact pertaining to
1377the business of such person in any book, report, or statement of
1378such person.
1379     (6)  Unlawful rebates.-
1380     (a)  Except as otherwise expressly provided by law, or in
1381an applicable filing with the department, knowingly:
1382     1.  Permitting, or offering to make, or making, any
1383contract or agreement as to such contract other than as plainly
1384expressed in the insurance contract issued thereon; or
1385     2.  Paying, allowing, or giving, or offering to pay, allow,
1386or give, directly or indirectly, as inducement to such insurance
1387contract, any unlawful rebate of premiums payable on the
1388contract, any special favor or advantage in the dividends or
1389other benefits thereon, or any valuable consideration or
1390inducement whatever not specified in the contract.
1391     (b)1.  A title insurer, or any member, employee, attorney,
1392agent, or agency thereof, may not pay, allow, or give, or offer
1393to pay, allow, or give, directly or indirectly, as inducement to
1394title insurance, or after such insurance has been effected, any
1395rebate or abatement of the premium or any other charge or fee,
1396or provide any special favor or advantage, or any monetary
1397consideration or inducement whatever.
1398     2.  Nothing in this paragraph shall be construed as
1399prohibiting the payment of fees to attorneys at law duly
1400licensed to practice law in the courts of this state, for
1401professional services, or as prohibiting the payment of earned
1402portions of the premium to duly appointed agents or agencies who
1403actually perform services for the title insurer. Nothing in this
1404paragraph shall be construed as prohibiting a rebate or
1405abatement of an attorney's fee charged for professional services
1406or any other closing charge or fee to the person responsible for
1407paying the closing charge or fee.
1408     3.  An insured named in a policy, or any other person
1409directly or indirectly connected with the transaction involving
1410the issuance of such policy, including, but not limited to, any
1411mortgage broker, real estate licensee, builder, or attorney, any
1412employee, agent, agency, or representative thereof, or any other
1413person whatsoever, may not knowingly receive or accept, directly
1414or indirectly, any rebate or abatement of any portion of the
1415title insurance premium or of any other charge or fee or any
1416monetary consideration or inducement whatsoever, except as set
1417forth in subparagraph 2. In no event shall any portion of the
1418attorney's fee, any closing charge or fee, or any other monetary
1419consideration or inducement be paid directly or indirectly for
1420the referral of title insurance business.
1421     (7)  Unfair claim settlement practices.-
1422     (a)  Attempting to settle claims on the basis of any
1423material document which was altered without notice to, or
1424knowledge or consent of, the insured;
1425     (b)  A material misrepresentation made to an insured or any
1426other person having an interest in the proceeds payable under
1427such contract or policy, for the purpose and with the intent of
1428effecting settlement of such claims, loss, or damage under such
1429contract or policy on less favorable terms than those provided
1430in, and contemplated by, such contract or policy; or
1431     (c)  Committing or performing with such frequency as to
1432indicate a general business practice any of the following:
1433     1.  Failing to adopt and implement standards for the proper
1434investigation of claims;
1435     2.  Misrepresenting pertinent facts or insurance policy
1436provisions relating to coverages at issue;
1437     3.  Failing to acknowledge and act promptly upon
1438communications with respect to claims;
1439     4.  Denying claims without conducting reasonable
1440investigations based upon available information;
1441     5.  Failing to affirm or deny full or partial coverage of
1442claims, and, as to partial coverage, the dollar amount or extent
1443of coverage, or failing to provide a written statement that the
1444claim is being investigated, upon the written request of the
1445insured within 30 days after proof-of-loss statements have been
1446completed;
1447     6.  Failing to promptly provide a reasonable explanation in
1448writing to the insured of the basis in the insurance policy, in
1449relation to the facts or applicable law, for denial of a claim
1450or for the offer of a compromise settlement;
1451     7.  Failing to promptly notify the insured of any
1452additional information necessary for the processing of a claim;
1453or
1454     8.  Failing to clearly explain the nature of the requested
1455information and the reasons why such information is necessary.
1456     (8)  Failure to maintain complaint-handling procedures.-
1457Failure of any person to maintain a complete record of all the
1458complaints received since the date of the last examination. For
1459purposes of this subsection, the term "complaint" means any
1460written communication primarily expressing a grievance.
1461     (9)  Misrepresentation in insurance applications.-Knowingly
1462making a false or fraudulent written or oral statement or
1463representation on, or relative to, an application or negotiation
1464for an insurance policy for the purpose of obtaining a fee,
1465commission, money, or other benefit from any insurer, agent,
1466broker, or individual.
1467     (10)  Advertising gifts permitted.-No provision of
1468subsection (6) or subsection (7) shall be deemed to prohibit a
1469licensed insurer or its agent from giving to insureds,
1470prospective insureds, and others, for the purpose of
1471advertising, any article of merchandise having a value of not
1472more than $25.
1473     (11)  Illegal dealings in premiums; excess or reduced
1474charges for insurance.-
1475     (a)  Knowingly collecting any sum as a premium or charge
1476for insurance, which is not then provided, or is not in due
1477course to be provided, subject to acceptance of the risk by the
1478insurer, by an insurance policy issued by an insurer as
1479permitted by this chapter.
1480     (b)  Knowingly collecting as a premium or charge for
1481insurance any sum in excess of or less than the premium or
1482charge applicable to such insurance, in accordance with the
1483applicable classifications and rates as filed with and approved
1484by the department, and as specified in the policy; or, in cases
1485when classifications, premiums, or rates are not required by
1486this chapter to be so filed and approved, premiums and charges
1487collected from a resident of this state in excess of or less
1488than those specified in the policy and as fixed by the insurer.
1489     (12)  Interlocking ownership and management.-
1490     (a)  Any domestic insurer may retain, invest in, or acquire
1491the whole or any part of the capital stock of any other insurer
1492or insurers, or have a common management with any other insurer
1493or insurers, unless such retention, investment, acquisition, or
1494common management is inconsistent with any other provision of
1495this chapter, or unless by reason thereof the business of such
1496insurers with the public is conducted in a manner which
1497substantially lessens competition generally in the insurance
1498business.
1499     (b)  Any person otherwise qualified may be a director of
1500two or more domestic insurers which are competitors, unless the
1501effect thereof is substantially to lessen competition between
1502insurers generally or materially tend to create a monopoly.
1503     (c)  Any limitation contained in this subsection does not
1504apply to any person who is a director of two or more insurers
1505under common control or management.
1506     (13)  Soliciting or accepting new or renewal insurance
1507risks by insolvent or impaired insurer prohibited; penalty.-
1508     (a)  Whether or not delinquency proceedings as to the
1509insurer have been or are to be initiated, but while such
1510insolvency or impairment exists, a director or officer of an
1511insurer, except with the written permission of the department,
1512may not authorize or permit the insurer to solicit or accept new
1513or renewal insurance risks in this state after such director or
1514officer knew, or reasonably should have known, that the insurer
1515was insolvent or impaired. The term "impaired" includes
1516impairment of capital or surplus, as defined in s. 631.011(12)
1517and (13).
1518     (b)  Any such director or officer, upon conviction of a
1519violation of this subsection, is guilty of a felony of the third
1520degree, punishable as provided in s. 775.082, s. 775.083, or s.
1521775.084.
1522     (14)  Refusal to insure.-In addition to other provisions of
1523this chapter, the refusal to insure, or continue to insure, any
1524individual or risk solely because of:
1525     (a)  Race, color, creed, marital status, sex, or national
1526origin;
1527     (b)  The residence, age, or lawful occupation of the
1528individual or the location of the risk, unless there is a
1529reasonable relationship between the residence, age, or lawful
1530occupation of the individual or the location of the risk and the
1531coverage issued or to be issued; or
1532     (c)  The insured's or applicant's failure to agree to place
1533collateral business with any insurer.
1534     (15)  Sliding.-Sliding is the act or practice of:
1535     (a)  Representing to the applicant that a specific
1536ancillary coverage or product is required by law in conjunction
1537with the purchase of insurance when such coverage or product is
1538not required;
1539     (b)  Representing to the applicant that a specific
1540ancillary coverage or product is included in the policy applied
1541for without an additional charge when such charge is required;
1542or
1543     (c)  Charging an applicant for a specific ancillary
1544coverage or product, in addition to the cost of the insurance
1545coverage applied for, without the informed consent of the
1546applicant.
1547     637.10335  Civil remedies against title insurers.-
1548     (1)(a)  Any person may bring a civil action against a title
1549insurer when such person is damaged:
1550     1.  By a violation by the insurer of s. 637.1033(7), (11),
1551or (14); or
1552     2.  By the commission of any of the following acts by the
1553insurer:
1554     a.  Not attempting in good faith to settle claims when,
1555under all the circumstances, it could and should have done so
1556had it acted fairly and honestly toward its insured and with
1557due regard for her or his interests;
1558     b.  Making claims payments to insureds or beneficiaries not
1559accompanied by a statement setting forth the coverage under
1560which payments are being made; or
1561     c.  Except as to liability coverages, failing to promptly
1562settle claims, when the obligation to settle a claim has become
1563reasonably clear, under one portion of the insurance policy
1564coverage in order to influence settlements under other portions
1565of the insurance policy coverage.
1566     (b)  Notwithstanding paragraph (a), a person pursuing a
1567remedy under this section need not prove that such act was
1568committed or performed with such frequency as to indicate a
1569general business practice.
1570     (2)  Any party may bring a civil action against an
1571unauthorized insurer if such party is damaged by a violation of
1572s. 637.1033 by the unauthorized insurer.
1573     (3)(a)  As a condition precedent to bringing an action
1574under this section, the department and the authorized insurer
1575must have been given 60 days' written notice of the violation.
1576If the department returns a notice for lack of specificity, the
157760-day time period shall not begin until a proper notice is
1578filed.
1579     (b)  The notice shall be on a form provided by the
1580department and shall state with specificity the following
1581information, and such other information as the department may
1582require:
1583     1.  The statutory provision, including the specific
1584language of the statute, which the authorized insurer allegedly
1585violated.
1586     2.  The facts and circumstances giving rise to the
1587violation.
1588     3.  The name of any individual involved in the violation.
1589     4.  A reference to specific policy language that is
1590relevant to the violation, if any. If the person bringing the
1591civil action is a third-party claimant, she or he shall not be
1592required to reference the specific policy language if the
1593authorized insurer has not provided a copy of the policy to the
1594third-party claimant pursuant to written request.
1595     5.  A statement that the notice is given in order to
1596perfect the right to pursue the civil remedy authorized by this
1597section.
1598     (c)  Within 20 days after receipt of the notice, the
1599department may return any notice that does not provide the
1600specific information required by this section, and the
1601department shall indicate the specific deficiencies contained in
1602the notice. A determination by the department to return a
1603notice for lack of specificity shall be exempt from the
1604requirements of chapter 120.
1605     (d)  An action may not lie if, within 60 days after filing
1606notice, the damages are paid or the circumstances giving rise to
1607the violation are corrected.
1608     (e)  The authorized insurer that is the recipient of a
1609notice filed pursuant to this section shall report to the
1610department on the disposition of the alleged violation.
1611     (f)  The applicable statute of limitations for an action
1612under this section shall be tolled for a period of 65 days by
1613the mailing of the notice required by this subsection or the
1614mailing of a subsequent notice required by this subsection.
1615     (4)  Upon adverse adjudication at trial or upon appeal,
1616the authorized insurer shall be liable for damages, together
1617with court costs and reasonable attorney's fees incurred by the
1618plaintiff.
1619     (5)(a)  Punitive damages may not be awarded under this
1620section unless the acts giving rise to the violation occur with
1621such frequency as to indicate a general business practice and
1622these acts are:
1623     1.  Willful, wanton, and malicious; or
1624     2.  In reckless disregard for the rights of any insured.
1625     (b)  Any person who pursues a claim under this subsection
1626shall post in advance the costs of discovery. Such costs shall
1627be awarded to the authorized insurer if no punitive damages are
1628awarded to the plaintiff.
1629     (6)  The civil remedy specified in this section does not
1630preempt any other remedy or cause of action provided pursuant
1631to any other statute or pursuant to the common law of this
1632state. Any person may obtain a judgment under the common-law
1633remedy of bad faith or the remedy provided under this section
1634but is not entitled to a judgment under both remedies. This
1635section shall not be construed to create a common-law cause of
1636action. The damages recoverable pursuant to this section shall
1637include those damages that are a reasonably foreseeable result
1638of a specified violation of this section by the authorized
1639insurer and may include an award or judgment in an amount
1640that exceeds the policy limits.
1641     637.1034  Favored title insurance agent or title insurer;
1642coercion of debtors.-
1643     (1)  A person may not:
1644     (a)  Require, as a condition precedent or condition
1645subsequent to the lending of money or extension of credit or any
1646renewal thereof, that the person to whom such money or credit is
1647extended, or whose obligation the creditor is to acquire or
1648finance, negotiate any policy or contract of insurance through a
1649particular insurer or group of insurers or agent or broker or
1650group of agents or brokers.
1651     (b)  Reject an insurance policy solely because the policy
1652has been issued or underwritten by any person who is not
1653associated with a financial institution, or with any subsidiary
1654or affiliate thereof, when such insurance is required in
1655connection with a loan or extension of credit; or unreasonably
1656disapprove the insurance policy provided by a borrower for the
1657protection of the property securing the credit or lien. For
1658purposes of this paragraph, such disapproval shall be deemed
1659unreasonable if it is not based solely on reasonable standards,
1660uniformly applied, relating to the extent of coverage required
1661by such lender or person extending credit and the financial
1662soundness and the services of an insurer. Such standards shall
1663not discriminate against any particular type of insurer, nor
1664shall such standards call for the disapproval of an insurance
1665policy because such policy contains coverage in addition to that
1666required.
1667     (c)  Require, directly or indirectly, that any borrower,
1668mortgagor, purchaser, insurer, broker, or agent pay a separate
1669charge in connection with the handling of any insurance policy
1670that is required in connection with a loan or other extension of
1671credit or the provision of another traditional banking product,
1672or pay a separate charge to substitute the insurance policy of
1673one insurer for that of another, unless such charge would be
1674required if the person were providing the insurance. This
1675paragraph does not include the interest which may be charged on
1676premium loans or premium advances in accordance with the
1677security instrument.
1678     (d)  Use or provide to others insurance information
1679required to be disclosed by a customer to a financial
1680institution, or a subsidiary or affiliate thereof, in connection
1681with the extension of credit for the purpose of soliciting the
1682sale of insurance, unless the customer has given express written
1683consent or has been given the opportunity to object to such use
1684of the information. Insurance information means information
1685concerning premiums, terms, and conditions of insurance
1686coverage, insurance claims, and insurance history provided by
1687the customer. The opportunity to object to the use of insurance
1688information must be in writing and must be clearly and
1689conspicuously made.
1690     (2)(a)  Any person offering the sale of insurance at the
1691time of and in connection with an extension of credit or the
1692sale or lease of goods or services shall disclose in writing
1693that the choice of an insurance provider will not affect the
1694decision regarding the extension of credit or sale or lease of
1695goods or services, except that reasonable requirements may be
1696imposed pursuant to subsection (1).
1697     (b)  Federally insured or state-insured depository
1698institutions and credit unions shall make clear and conspicuous
1699disclosure in writing prior to the sale of any insurance policy
1700that such policy is not a deposit, is not insured by the Federal
1701Deposit Insurance Corporation or any other entity, is not
1702guaranteed by the insured depository institution or any person
1703soliciting the purchase of or selling the policy; that the
1704financial institution is not obligated to provide benefits under
1705the insurance contract; and, where appropriate, that the policy
1706involves investment risk, including potential loss of principal.
1707     (c)  All documents constituting policies of insurance shall
1708be separate and shall not be combined with or be a part of other
1709documents. A person may not include the expense of insurance
1710premiums in a primary credit transaction without the express
1711written consent of the customer.
1712     (d)  A loan officer of a financial institution who is
1713involved in the application, solicitation, or closing of a loan
1714transaction may not solicit or sell insurance in connection with
1715the same loan, but such loan officer may refer the loan customer
1716to another insurance agent who is not involved in the
1717application, solicitation, or closing of the same loan
1718transaction. This paragraph does not apply to an agent located
1719on premises having only a single person with lending authority,
1720or to a broker or dealer registered under the Federal Securities
1721Exchange Act of 1934 in connection with a margin loan secured by
1722securities.
1723     (3)  A person may not make an extension of credit or the
1724sale of any product or service that is the equivalent to an
1725extension of credit or lease or sale of property of any kind, or
1726furnish any services or fix or vary the consideration for any of
1727the foregoing, on the condition or requirement that the customer
1728obtain insurance from that person, or a subsidiary or affiliate
1729of that person, or a particular insurer, agent, or broker;
1730however, this subsection does not prohibit any person from
1731engaging in any activity that if done by a financial institution
1732would not violate s. 106 of the Bank Holding Company Act
1733Amendments of 1970, 12 U.S.C. s. 1972, as interpreted by the
1734Board of Governors of the Federal Reserve System.
1735     (4)  The department may investigate the affairs of any
1736person to whom this section applies to determine whether such
1737person has violated this section. If a violation of this section
1738is found to have been committed knowingly, the person in
1739violation shall be subject to the same procedures and penalties
1740as provided in ss. 637.1036, 637.1037, 637.1038 and 637.1039.
1741     637.1035  Power of department.-The department may examine
1742and investigate the affairs of every person involved in the
1743business of insurance in this state in order to determine
1744whether such person has been or is engaged in any unfair method
1745of competition or in any unfair or deceptive act or practice
1746prohibited by s. 637.1032, and shall each have the powers and
1747duties specified in ss. 637.1036-637.1039 in connection
1748therewith.
1749     637.1036  Defined practices; hearings, witnesses,
1750appearances, production of books and service of process.-
1751     (1)  Whenever the department has reason to believe that any
1752person has engaged, or is engaging, in this state in any unfair
1753method of competition or any unfair or deceptive act or practice
1754as defined in s. 637.1033 or s. 637.1034 or is engaging in the
1755business of insurance without being properly licensed as
1756required by this chapter and that a proceeding by it in respect
1757thereto would be to the interest of the public, it shall conduct
1758or cause to have conducted a hearing in accordance with chapter
1759120.
1760     (2)  The department, a duly empowered hearing officer, or
1761an administrative law judge shall, during the conduct of such
1762hearing, have those powers enumerated in s. 120.569; however,
1763the penalties for failure to comply with a subpoena or with an
1764order directing discovery shall be limited to a fine not to
1765exceed $1,000 per violation.
1766     (3)  Statements of charges, notices, and orders under this
1767act may be served by anyone duly authorized by the department,
1768in the manner provided by law for service of process in civil
1769actions or by certifying and mailing a copy thereof to the
1770person affected by such statement, notice, order, or other
1771process at his or her or its residence or principal office or
1772place of business. The verified return by the person so serving
1773such statement, notice, order, or other process, setting forth
1774the manner of the service, shall be proof of the same, and the
1775return postcard receipt for such statement, notice, order, or
1776other process, certified and mailed as aforesaid, shall be proof
1777of service of the same.
1778     637.1037  Cease and desist and penalty orders.-After the
1779hearing provided in s. 637.1036, the department shall enter a
1780final order in accordance with s. 120.569. If it is determined
1781that the person charged has engaged in an unfair or deceptive
1782act or practice or the unlawful transaction of insurance, the
1783department shall also issue an order requiring the violator to
1784cease and desist from engaging in such method of competition,
1785act, or practice or the unlawful transaction of insurance.
1786Further, if the act or practice is a violation of s. 637.1033 or
1787s. 637.1034, the department may, at its discretion, order any
1788one or more of the following:
1789     (1)  Suspension or revocation of the person's certificate
1790of authority, license, or eligibility for any certificate of
1791authority or license, if he or she knew, or reasonably should
1792have known, he or she was in violation of this chapter.
1793     (2)  Such other relief as may be provided in this chapter.
1794     637.1038  Appeals from the department.-Any person subject
1795to an order of the department under s. 637.1037 or s. 637.1039
1796may obtain a review of such order by filing an appeal therefrom
1797in accordance with the provisions and procedures for appeal from
1798the orders of the department in general under s. 120.68.
1799     637.1039  Penalty for violation of cease and desist
1800orders.-Any person who violates a cease and desist order of the
1801department under s. 637.1037 while such order is in effect,
1802after notice and hearing as provided in s. 637.1036, shall be
1803subject, at the discretion of the department, to any one or more
1804of the following:
1805     (1)  A monetary penalty of not more than $50,000 as to all
1806matters determined in such hearing.
1807     (2)  Suspension or revocation of such person's certificate
1808of authority, license, or eligibility to hold such certificate
1809of authority or license.
1810     (3)  Such other relief as may be provided in this chapter.
1811     637.1041  Rules.-
1812     (1)  The department may, in accordance with chapter 120,
1813adopt reasonable rules as are necessary or proper to identify
1814specific methods of competition or acts or practices which are
1815prohibited by s. 637.1033 or s. 637.1034, but the rules shall
1816not enlarge upon or extend the provisions of ss. 637.1033 and
1817637.1034.
1818     (2)  The department shall, in accordance with chapter 120,
1819adopt rules to protect members of the United States Armed Forces
1820from dishonest or predatory insurance sales practices by
1821insurers and insurance agents. The rules shall identify specific
1822false, misleading, deceptive, or unfair methods of competition,
1823acts, or practices which are prohibited by s. 637.1033 or s.
1824637.1034. The rules shall be based upon model rules or model
1825laws adopted by the National Association of Insurance
1826Commissioners which identify certain insurance practices
1827involving the solicitation or sale of insurance and annuities to
1828members of the United States Armed Forces which are false,
1829misleading, deceptive, or unfair.
1830     637.1042  Provisions of chapter additional to existing
1831law.-The powers vested in the department by this chapter shall
1832be additional to any other powers to enforce any penalties,
1833fines, or forfeitures authorized by law.
1834     637.1043  Civil liability.-The provisions of this chapter
1835are cumulative to rights under the general civil and common law,
1836and no action of the department, shall abrogate such rights to
1837damages or other relief in any court.
1838     637.10435  Policyholders Bill of Rights.-
1839     (1)  The principles expressed in the following statements
1840shall serve as standards to be followed by the department in
1841exercising its powers and duties, in exercising administrative
1842discretion, in dispensing administrative interpretations of the
1843law, and in adopting rules:
1844     (a)  Policyholders have the right to competitive pricing
1845practices and marketing methods that enable them to determine
1846the best value among comparable policies.
1847     (b)  Policyholders have the right to obtain comprehensive
1848coverage.
1849     (c)  Policyholders have the right to insurance advertising
1850and other selling approaches that provide accurate and balanced
1851information on the benefits and limitations of a policy.
1852     (d)  Policyholders have a right to an insurance company
1853that is financially stable.
1854     (e)  Policyholders have the right to be serviced by a
1855competent, honest insurance agent or broker.
1856     (f)  Policyholders have the right to a readable policy.
1857     (g)  Policyholders have the right to an insurance company
1858that provides an economic delivery of coverage and that tries to
1859prevent losses.
1860     (h)  Policyholders have the right to a balanced and
1861positive regulation by the department.
1862     (2)  This section shall not be construed as creating a
1863civil cause of action by any individual policyholder against any
1864individual insurer.
1865     637.1044  Privacy.-The department shall adopt rules
1866consistent with other provisions of this chapter to govern the
1867use of a consumer's nonpublic personal financial and health
1868information. These rules must be based on, consistent with, and
1869not more restrictive than the Privacy of Consumer Financial and
1870Health Information Regulation, adopted September 26, 2000, by
1871the National Association of Insurance Commissioners. In
1872addition, these rules must be consistent with, and not more
1873restrictive than, the standards contained in Title V of the
1874Gramm-Leach-Bliley Act of 1999, Pub. L. No. 106-102.
1875     637.10445  Trade secret documents.-
1876     (1)  If any person who is required to submit documents
1877or other information to the department pursuant to this chapter
1878or by rule or order of the department claims that such
1879submission contains a trade secret, such person may file with
1880the department a notice of trade secret as provided in this
1881section. Failure to do so constitutes a waiver of any claim by
1882such person that the document or information is a trade secret.
1883     (a)  Each page of such document or specific portion of a
1884document claimed to be a trade secret must be clearly marked
1885"trade secret."
1886     (b)  All material marked as a trade secret must be
1887separated from all non-trade secret material and be submitted in
1888a separate envelope clearly marked "trade secret."
1889     (c)  In submitting a notice of trade secret to the
1890department, the submitting party must include an affidavit
1891certifying under oath to the truth of the following
1892statements concerning all documents or information that are
1893claimed to be trade secrets:
1894     1.  [I consider/My company considers] this information a
1895trade secret that has value and provides an advantage or an
1896opportunity to obtain an advantage over those who do not know or
1897use it.
1898     2.  [I have/My company has] taken measures to prevent the
1899disclosure of the information to anyone other than those who
1900have been selected to have access for limited purposes, and [I
1901intend/my company intends] to continue to take such measures.
1902     3.  The information is not, and has not been, reasonably
1903obtainable without [my/our] consent by other persons by use of
1904legitimate means.
1905     4.  The information is not publicly available elsewhere.
1906     (d)  Any data submitted by a title insurance agent or title
1907insurer pursuant to s. 637.1014 is presumed to be a trade
1908secret under this section whether or not so designated.
1909     (2)  If the department receives a public records request for
1910a document or information that is marked and certified as a trade
1911secret, the department shall promptly notify the person that
1912certified the document as a trade secret. The notice shall
1913inform such person that he or she or his or her company has 30
1914days after receipt of such notice to file an action in circuit
1915court seeking a determination whether the document in question
1916contains trade secrets and an order barring public disclosure of
1917the document. If that person or company files an action within
191830 days after receipt of notice of the public records request,
1919the department may not release the documents pending the outcome
1920of the legal action. The failure to file an action within 30
1921days constitutes a waiver of any claim of confidentiality,
1922and the department shall release the document as requested.
1923     (3)  The department may disclose a trade secret, together
1924with the claim that it is a trade secret, to an officer or
1925employee of another governmental agency whose use of the trade
1926secret is within the scope of his or her employment.
1927     637.1045  Financial institutions conducting title insurance
1928transactions.-A financial institution, as defined in s.
1929655.005(1)(g), (h), or (p), may conduct title insurance
1930transactions only through Florida-licensed title insurance
1931agents representing Florida-authorized title insurers.
1932     637.1046  Investigation by department or Division of
1933Insurance Fraud; compliance; immunity; confidential information;
1934reports to division; division investigator's power of arrest.-
1935     (1)  For the purposes of this section, a person commits a
1936"fraudulent insurance act" if the person knowingly and with
1937intent to defraud presents, causes to be presented, or prepares
1938with knowledge or belief that it will be presented, to or by a
1939title insurer or any title insurance agent, any written
1940statement as part of, or in support of, an application for the
1941issuance of, or the rating of, any insurance policy, or a claim
1942for payment or other benefit pursuant to any insurance policy,
1943which the person knows to contain materially false information
1944concerning any fact material thereto or if the person conceals,
1945for the purpose of misleading another, information concerning
1946any fact material thereto.
1947     (2)  If, by its own inquiries or as a result of complaints,
1948the department or its Division of Insurance Fraud has reason to
1949believe that a person has engaged in, or is engaging in, a
1950fraudulent insurance act, an act or practice that violates s.
1951637.1033 or s. 817.234, or an act or practice punishable under
1952s. 637.1008, it may administer oaths and affirmations, request
1953the attendance of witnesses or proffering of matter, and collect
1954evidence. The department shall not compel the attendance of any
1955person or matter in any such investigation except pursuant to
1956subsection (4).
1957     (3)  If matter that the department or its division seeks to
1958obtain by request is located outside the state, the person so
1959requested may make it available to the division or its
1960representative to examine the matter at the place where it is
1961located. The division may designate representatives, including
1962officials of the state in which the matter is located, to
1963inspect the matter on its behalf, and it may respond to similar
1964requests from officials of other states.
1965     (4)(a)  The department or the division may request that an
1966individual who refuses to comply with any such request be
1967ordered by the circuit court to provide the testimony or matter.
1968The court shall not order such compliance unless the department
1969or the division has demonstrated to the satisfaction of the
1970court that the testimony of the witness or the matter under
1971request has a direct bearing on the department of a fraudulent
1972insurance act, on a violation of s. 637.1033 or s. 817.234, or
1973on an act or practice punishable under s. 637.1008 or is
1974pertinent and necessary to further such investigation.
1975     (b)  Except in a prosecution for perjury, an individual who
1976complies with a court order to provide testimony or matter after
1977asserting a privilege against self-incrimination to which the
1978individual is entitled by law may not be subjected to a criminal
1979proceeding or to a civil penalty with respect to the act
1980concerning which the individual is required to testify or
1981produce relevant matter.
1982     (c)  In the absence of fraud or bad faith, a person is not
1983subject to civil liability for libel, slander, or any other
1984relevant tort by virtue of filing reports, without malice, or
1985furnishing other information, without malice, required by this
1986section or required by the department or division under the
1987authority granted in this section, and no civil cause of action
1988of any nature shall arise against such person:
1989     1.  For any information relating to suspected fraudulent
1990insurance acts or persons suspected of engaging in such acts
1991furnished to or received from law enforcement officials, their
1992agents, or employees;
1993     2.  For any information relating to suspected fraudulent
1994insurance acts or persons suspected of engaging in such acts
1995furnished to or received from other persons subject to the
1996provisions of this chapter;
1997     3.  For any such information furnished in reports to the
1998department, the division, the National Insurance Crime Bureau,
1999the National Association of Insurance Commissioners, or any
2000local, state, or federal enforcement officials or their agents
2001or employees; or
2002     4.  For other actions taken in cooperation with any of the
2003agencies or individuals specified in this paragraph in the
2004lawful investigation of suspected fraudulent insurance acts.
2005     (d)  In addition to the immunity granted in paragraph (c),
2006persons identified as designated employees or service providers
2007to insurers whose responsibilities include the investigation and
2008disposition of claims relating to suspected fraudulent insurance
2009acts may share information relating to persons suspected of
2010committing fraudulent insurance acts with other designated
2011employees employed by the same or other insurers or third-party
2012service providers designated by insurers whose responsibilities
2013include the investigation and disposition of claims relating to
2014fraudulent insurance acts, provided the department has been
2015given written notice of the names and job titles of such
2016designated employees and service providers prior to such
2017designated employees and service providers sharing information.
2018Unless the designated employees or service providers of the
2019insurer act in bad faith or in reckless disregard for the rights
2020of any insured, the insurer or its designated employees and
2021service providers are not civilly liable for libel, slander, or
2022any other relevant tort, and a civil action does not arise
2023against the insurer or its designated employees and service
2024providers:
2025     1.  For any information related to suspected fraudulent
2026insurance acts provided to an insurer; or
2027     2.  For any information relating to suspected fraudulent
2028insurance acts provided to the National Insurance Crime Bureau
2029or the National Association of Insurance Commissioners.
2030
2031However, the qualified immunity against civil liability
2032conferred on any insurer or its designated employees and service
2033providers shall be forfeited with respect to the exchange or
2034publication of any defamatory information with third persons not
2035expressly authorized by this paragraph to share in such
2036information.
2037     (e)  The Chief Financial Officer and any employee or agent
2038of the department, when acting without malice and in the absence
2039of fraud or bad faith, is not subject to civil liability for
2040libel, slander, or any other relevant tort, and no civil cause
2041of action of any nature exists against such person by virtue of
2042the execution of official activities or duties of the department
2043under this section or by virtue of the publication of any report
2044or bulletin related to the official activities or duties of the
2045department under this section.
2046     (f)  This section does not abrogate or modify in any way
2047any common-law or statutory privilege or immunity heretofore
2048enjoyed by any person.
2049     (5)  Any person, other than an insurer, agent, or other
2050person licensed under this chapter, or an employee thereof,
2051having knowledge or who believes that a fraudulent insurance act
2052or any other act or practice which, upon conviction, constitutes
2053a felony or a misdemeanor under this chapter, or under s.
2054817.234, is being or has been committed may send to the Division
2055of Insurance Fraud a report or information pertinent to such
2056knowledge or belief and such additional information relative
2057thereto as the department may request. Any professional
2058practitioner licensed or regulated by the Department of Business
2059and Professional Regulation, except as otherwise provided by
2060law, any medical review committee as defined in s. 766.101, any
2061title insurer, title insurance agent, or other person licensed
2062under this chapter, or an employee thereof, having knowledge or
2063who believes that a fraudulent insurance act or any other act or
2064practice which, upon conviction, constitutes a felony or a
2065misdemeanor under this chapter, or under s. 817.234, is being or
2066has been committed shall send to the Division of Insurance Fraud
2067a report or information pertinent to such knowledge or belief
2068and such additional information relative thereto as the
2069department may require. The Division of Insurance Fraud shall
2070review such information or reports and select such information
2071or reports as, in its judgment, may require further
2072investigation. It shall then cause an independent examination of
2073the facts surrounding such information or report to be made to
2074determine the extent, if any, to which a fraudulent insurance
2075act or any other act or practice which, upon conviction,
2076constitutes a felony or a misdemeanor under this chapter, or
2077under s. 817.234, is being committed. The Division of Insurance
2078Fraud shall report any alleged violations of law which its
2079investigations disclose to the appropriate licensing agency and
2080state attorney or other prosecuting agency having jurisdiction
2081with respect to any such violation, as provided in s. 637.302.
2082If prosecution by the state attorney or other prosecuting agency
2083having jurisdiction with respect to such violation is not begun
2084within 60 days of the division's report, the state attorney or
2085other prosecuting agency having jurisdiction with respect to
2086such violation shall inform the division of the reasons for the
2087lack of prosecution.
2088     (6)  Division investigators may make arrests for criminal
2089violations established as a result of investigations. Such
2090investigators shall also be considered state law enforcement
2091officers for all purposes and may execute arrest warrants and
2092search warrants; serve subpoenas issued for the examination,
2093investigation, and trial of all offenses; and arrest upon
2094probable cause without warrant any person found in the act of
2095violating any of the provisions of applicable laws.
2096Investigators empowered to make arrests under this section shall
2097be empowered to bear arms in the performance of their duties. In
2098such a situation, the investigator must be certified in
2099compliance with the provisions of s. 943.1395 or must meet the
2100temporary employment or appointment exemption requirements of s.
2101943.131 until certified.
2102     (7)  It is unlawful for any person to resist an arrest
2103authorized by this section or in any manner to interfere, either
2104by abetting or assisting such resistance or otherwise
2105interfering, with division investigators in the duties imposed
2106upon them by law or department rule.
2107     637.1047  Insurer anti-fraud investigative units; reporting
2108requirements; penalties for noncompliance.-
2109     (1)(a)  Every insurer admitted to do business in this state
2110who in the previous calendar year, at any time during that year,
2111had $10 million or more in direct premiums written shall:
2112     1.  Establish and maintain a unit or division within the
2113company to investigate possible fraudulent claims by insureds;
2114or
2115     2.  Contract with others to investigate possible fraudulent
2116claims by insureds.
2117     (b)  An insurer subject to this subsection shall file with
2118the Division of Insurance Fraud of the department on or before
2119July 1, 1996, a detailed description of the unit or division
2120established pursuant to subparagraph (a)1. or a copy of the
2121contract specified by subparagraph (a)2.
2122     (2)  Every insurer admitted to do business in this state,
2123which in the previous calendar year had less than $10 million in
2124direct premiums written, must adopt an anti-fraud plan and file
2125it with the Division of Insurance Fraud of the department on or
2126before July 1, 1996. An insurer may, in lieu of adopting and
2127filing an anti-fraud plan, comply with the provisions of
2128subsection (1).
2129     (3)  Each insurers anti-fraud plans shall include:
2130     (a)  A description of the insurer's procedures for
2131detecting and investigating possible fraudulent insurance acts.
2132     (b)  A description of the insurer's procedures for the
2133mandatory reporting of possible fraudulent insurance acts to the
2134Division of Insurance Fraud of the department.
2135     (c)  A description of the insurer's plan for anti-fraud
2136education and training of its claims adjusters or other
2137personnel.
2138     (d)  A written description or chart outlining the
2139organizational arrangement of the insurer's anti-fraud personnel
2140who are responsible for the investigation and reporting of
2141possible fraudulent insurance acts.
2142     (4)  Any insurer who obtains a certificate of authority
2143after July 1, 1995, shall have 18 months in which to comply with
2144the requirements of this section.
2145     (5)  For purposes of this section, the term "unit or
2146division" includes the assignment of fraud investigation to
2147employees whose principal responsibilities are the investigation
2148and disposition of claims. If an insurer creates a distinct unit
2149or division, hires additional employees, or contracts with
2150another entity to fulfill the requirements of this section, the
2151additional cost incurred must be included as an administrative
2152expense for ratemaking purposes.
2153     (6)  If an insurer fails to timely submit a final
2154acceptable anti-fraud plan or anti-fraud investigative unit
2155description, fails to implement the provisions of a plan or an
2156anti-fraud investigative unit description, or otherwise refuses
2157to comply with the provisions of this section, the department,
2158may:
2159     (a)  Impose an administrative fine of not more than $2,000
2160per day for such failure by an insurer to submit an acceptable
2161anti-fraud plan or anti-fraud investigative unit description,
2162until the department deems the insurer to be in compliance;
2163     (b)  Impose an administrative fine for failure by an
2164insurer to implement or follow the provisions of an anti-fraud
2165plan or anti-fraud investigative unit description; or
2166     (c)  Impose the provisions of both paragraphs (a) and (b).
2167     (7)  The department may adopt rules to administer this
2168section.
2169     637.1048  Anti-Fraud Reward Program; reporting of title
2170insurance fraud.-
2171     (1)  The Anti-Fraud Reward Program is hereby established
2172within the department, to be funded from the Title Insurance
2173Regulatory Trust Fund.
2174     (2)  The department may pay rewards of up to $25,000 to
2175persons providing information leading to the arrest and
2176conviction of persons committing crimes investigated by the
2177Division of Insurance Fraud arising from violations of s.
2178440.105, s. 637.1008, s. 637.1033, s. 637.1046, or s. 817.234.
2179     (3)  Only a single reward amount may be paid by the
2180department for claims arising out of the same transaction or
2181occurrence, regardless of the number of persons arrested and
2182convicted and the number of persons submitting claims for the
2183reward. The reward may be disbursed among more than one person
2184in amounts determined by the department.
2185     (4)  The department shall adopt rules which set forth the
2186application and approval process, including the criteria against
2187which claims shall be evaluated, the basis for determining
2188specific reward amounts, and the manner in which rewards shall
2189be disbursed. Applications for rewards authorized by this
2190section must be made pursuant to rules established by the
2191department.
2192     (5)  Determinations by the department to grant or deny a
2193reward under this section shall not be considered agency action
2194subject to review under s. 120.569 or s. 120.57.
2195     637.1049  Disposition of revenues; criminal or forfeiture
2196proceedings.-
2197     (1)  The Division of Insurance Fraud of the Department of
2198Financial Services may deposit revenues received as a result of
2199criminal proceedings or forfeiture proceedings, other than
2200revenues deposited into the Department of Financial Services's
2201Federal Law Enforcement Trust Fund under s. 17.43, into the
2202Title Insurance Regulatory Trust Fund. Moneys deposited pursuant
2203to this section shall be separately accounted for and shall be
2204used solely for the division to carry out its duties and
2205responsibilities.
2206     (2)  Moneys deposited into the Title Insurance Regulatory
2207Trust Fund pursuant to this section shall be appropriated by the
2208Legislature, pursuant to the provisions of chapter 216, for the
2209sole purpose of enabling the division to carry out its duties
2210and responsibilities.
2211     (3)  Notwithstanding the provisions of s. 216.301 and
2212pursuant to s. 216.351, any balance of moneys deposited into the
2213Title Insurance Regulatory Trust Fund pursuant to this section
2214remaining at the end of any fiscal year shall remain in the
2215trust fund at the end of that year and shall be available for
2216carrying out the duties and responsibilities of the division.
2217     Section 3.  Part II of chapter 637, Florida Statutes,
2218consisting of sections 637.2001, 637.2002, 637.2003, 637.20035,
2219637.2004, 637.2005, 637.2006, 637.2007, 637.20073, 637.20075,
2220637.2008, 637.2009, 637.2011, 637.2012, 637.2013, 637.2014,
2221637.2015, 637.2016, 637.2017, 637.2018, 637.2019, 637.2021,
2222637.2022, 637.2023, 637.2024, 637.2025, 637.2026, 637.2027,
2223637.2028, 637.2029, 637.2031, 637.2032, 637.2033, 637.2034,
2224637.2035, 637.2036, 637.2037, 637.2038, 637.2039, 637.2041,
2225637.2042, 637.2043, 637.2046, 637.2047, 637.2048, 637.20485,
2226637.2049, 637.20495, 637.2051, 637.2052, 637.2053, 637.2054,
2227637.2055, 637.2056, 637.2057, 637.2058, 637.2059, 637.2061,
2228637.2063, 637.2064, 637.2065, 637.2066, 637.2067, 637.2068,
2229637.2069, 637.2071, 637.2072, 637.2073, 637.2074, 637.2075,
2230637.2076, 637.2077, 637.2078, 637.2079, 637.2081, 637.2082,
2231637.2083, 637.2084, 637.2085, 637.2086, 637.2087, 637.2088,
2232637.2089, and 637.2091, is created and entitled "ADMINISTRATION
2233OF TITLE INSURERS."
2234     Section 4.  Sections 637.2001, 637.2002, 637.2003,
2235637.20035, 637.2004, 637.2005, 637.2006, and 637.2007, Florida
2236Statutes, are created to read:
2237     637.2001  Certificate of authority required.-
2238     (1)  A person may not act as a title insurer, and a title
2239insurer or its agents, attorneys, or representatives may not
2240directly or indirectly transact title insurance, in this state
2241except as authorized by a subsisting certificate of authority
2242issued to the title insurer by the department, except as to such
2243transactions as are expressly otherwise provided for in this
2244chapter.
2245     (2)  A title insurer may not, from offices or by personnel
2246or facilities located in this state, solicit title insurance
2247applications or otherwise transact title insurance in another
2248state or country unless it holds a subsisting certificate of
2249authority issued to it by the department authorizing it to
2250transact the same kind or kinds of title insurance in this
2251state.
2252     (3)  This state hereby preempts the field of regulating
2253title insurers and their agents and representatives; and a
2254county, city, municipality, district, school district, or
2255political subdivision may not require of any title insurer,
2256title insurance agent, or representative regulated under this
2257chapter any authorization, permit, or registration of any kind
2258for conducting transactions lawful under the authority granted
2259by the state under this chapter.
2260     (4)(a)  Any person who acts as a title insurer, transacts
2261title insurance, or otherwise engages in title insurance
2262activities in this state without a certificate of authority in
2263violation of this section commits a felony of the third degree,
2264punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
2265     (b)  However, any person acting as a title insurer without
2266a valid certificate of authority who violates this section
2267commits insurance fraud, punishable as provided in this
2268paragraph. If the amount of any insurance premium collected with
2269respect to any violation of this section:
2270     1.  Is less than $20,000, the offender commits a felony of
2271the third degree, punishable as provided in s. 775.082, s.
2272775.083, or s. 775.084, and the offender shall be sentenced to a
2273minimum term of imprisonment of 1 year.
2274     2.  Is $20,000 or more, but less than $100,000, the
2275offender commits a felony of the second degree, punishable as
2276provided in s. 775.082, s. 775.083, or s. 775.084, and the
2277offender shall be sentenced to a minimum term of imprisonment of
227818 months.
2279     3.  Is $100,000 or more, the offender commits a felony of
2280the first degree, punishable as provided in s. 775.082, s.
2281775.083, or s. 775.084, and the offender shall be sentenced to a
2282minimum term of imprisonment of 2 years.
2283     637.2002  Exceptions, certificate of authority required.-A
2284certificate of authority shall not be required of a title
2285insurer with respect to:
2286     (1)  Investigation, settlement, or litigation of claims
2287under its policies lawfully written in this state, or
2288liquidation of assets and liabilities of the insurer (other than
2289collection of new premiums), all as resulting from its former
2290authorized operations in this state.
2291     (2)  Transactions involving a policy, subsequent to
2292issuance thereof, covering only subjects of insurance not
2293resident, located, or expressly to be performed in this state at
2294the time of issuance, and lawfully solicited, written, or
2295delivered outside this state.
2296     (3)  Reinsurance, when transacted as authorized under s.
2297637.2049.
2298     (4)  Investment by a foreign insurer of its funds in real
2299estate in this state or in securities secured thereby, if the
2300foreign insurer complies with the laws of this state relating
2301generally to foreign business corporations.
2302     637.2003  General eligibility of title insurers for
2303certificate of authority.-To qualify for and hold authority to
2304transact title insurance in this state, a title insurer must be
2305otherwise in compliance with this chapter and with its charter
2306powers and must be an incorporated stock insurer, an
2307incorporated mutual insurer, or a reciprocal insurer, of the
2308same general type as may be formed as a domestic insurer under
2309this chapter; except that:
2310     (1)  A title insurer may not be authorized to transact
2311title insurance in this state which does not maintain reserves
2312as required by part I of chapter 625 applicable to the kind or
2313kinds of insurance transacted by such insurer, wherever
2314transacted in the United States, or which transacts insurance in
2315the United States on the assessment premium plan, stipulated
2316premium plan, cooperative plan, or any similar plan.
2317     (2)  A foreign or alien title insurer or exchange may not
2318be authorized to transact title insurance in this state unless
2319it is otherwise qualified therefor under this chapter and has
2320operated satisfactorily for at least 3 years in its state or
2321country of domicile; however, the department may waive the 3-
2322year requirement if the foreign or alien insurer or exchange:
2323     (a)  Has operated successfully and has capital and surplus
2324of $5 million;
2325     (b)  Is the wholly owned subsidiary of an insurer which is
2326an authorized insurer in this state; or
2327     (c)  Is the successor in interest through merger or
2328consolidation of an authorized insurer.
2329     (3)(a)  The department shall not grant or continue
2330authority to transact title insurance in this state as to any
2331title insurer the management, officers, or directors of which
2332are found by it to be incompetent or untrustworthy; or so
2333lacking in insurance company managerial experience as to make
2334the proposed operation hazardous to the insurance-buying public;
2335or so lacking in insurance experience, ability, and standing as
2336to jeopardize the reasonable promise of successful operation; or
2337which it has good reason to believe are affiliated directly or
2338indirectly through ownership, control, reinsurance transactions,
2339or other insurance or business relations, with any person or
2340persons whose business operations are or have been marked, to
2341the detriment of policyholders or stockholders or investors or
2342creditors or of the public, by manipulation of assets, accounts,
2343or reinsurance or by bad faith.
2344     (b)  The department shall not grant or continue authority
2345to transact title insurance in this state as to any title
2346insurer if any person, including any subscriber, stockholder, or
2347incorporator, who exercises or has the ability to exercise
2348effective control of the insurer, or who influences or has the
2349ability to influence the transaction of the business of the
2350insurer, does not possess the financial standing and business
2351experience for the successful operation of the insurer.
2352     (c)  The department may deny, suspend, or revoke the
2353authority to transact title insurance in this state of any title
2354insurer if any person, including any subscriber, stockholder, or
2355incorporator, who exercises or has the ability to exercise
2356effective control of the insurer, or who influences or has the
2357ability to influence the transaction of the business of the
2358insurer, has been found guilty of, or has pleaded guilty or nolo
2359contendere to, any felony or crime punishable by imprisonment of
23601 year or more under the law of the United States or any state
2361thereof or under the law of any other country which involves
2362moral turpitude, without regard to whether a judgment of
2363conviction has been entered by the court having jurisdiction in
2364such case. However, in the case of an insurer operating under a
2365subsisting certificate of authority, the insurer shall remove
2366any such person immediately upon discovery of the conditions set
2367forth in this paragraph when applicable to such person or upon
2368the order of the department, and the failure to so act by said
2369insurer shall be grounds for revocation or suspension of the
2370insurer's certificate of authority.
2371     (d)  The department may deny, suspend, or revoke the
2372authority of a title insurer to transact title insurance in this
2373state if any person, including any subscriber, stockholder, or
2374incorporator, who exercises or has the ability to exercise
2375effective control of the insurer, or who influences or has the
2376ability to influence the transaction of the business of the
2377insurer, which person the department has good reason to believe
2378is now or was in the past affiliated directly or indirectly,
2379through ownership interest of 10 percent or more, control, or
2380reinsurance transactions, with any business, corporation, or
2381other entity that has been found guilty of or has pleaded guilty
2382or nolo contendere to any felony or crime punishable by
2383imprisonment for 1 year or more under the laws of the United
2384States, any state, or any other country, regardless of
2385adjudication. However, in the case of an insurer operating under
2386a subsisting certificate of authority, the insurer shall
2387immediately remove such person or immediately notify the
2388department of such person upon discovery of the conditions set
2389forth in this paragraph, either when applicable to such person
2390or upon order of the department; the failure to remove such
2391person, provide such notice, or comply with such order
2392constitutes grounds for suspension or revocation of the
2393insurer's certificate of authority.
2394     (4)(a)  An authorized title insurer may not act as a
2395fronting company for any unauthorized insurer which is not an
2396approved reinsurer.
2397     (b)  A "fronting company" is an authorized insurer which by
2398reinsurance or otherwise generally transfers more than 50
2399percent to one unauthorized insurer which does not meet the
2400requirements of s. 637.604(3)(a), (b), or (c), or more than 75
2401percent to two or more unauthorized insurers which do not meet
2402the requirements of s. 637.604(3)(a), (b), or (c), of the entire
2403risk of loss on all of the insurance written by it in this
2404state, or on one or more lines of insurance, on all of the
2405business produced through one or more agents or agencies, or on
2406all of the business from a designated geographical territory,
2407without obtaining the prior approval of the department.
2408     (c)  The department may, in its discretion, approve a
2409transfer of risk in excess of the limits in paragraph (b) upon
2410presentation of evidence, satisfactory to the department, that
2411the transfer would be in the best interests of the financial
2412condition of the insurer and in the best interests of the
2413policyholders.
2414     (5)  A title insurer may not be authorized to transact
2415title insurance in this state which, during the 3 years
2416immediately preceding its application for a certificate of
2417authority, has violated any of the insurance laws of this state
2418and after being informed of such violation has failed to correct
2419the same; except that, if all other requirements are met, the
2420department may nevertheless issue a certificate of authority to
2421such an insurer upon the filing by the insurer of a sworn
2422statement of all such insurance so written in violation of law,
2423and upon payment to the department of a sum of money as
2424additional filing fee equivalent to all premium taxes and other
2425state taxes and fees as would have been payable by the insurer
2426if such insurance had been lawfully written by an authorized
2427insurer under the laws of this state. This fee, when collected,
2428shall be deposited to the credit of the Title Insurance
2429Regulatory Trust Fund.
2430     (6)  Nothing in this chapter shall be deemed to prohibit
2431the granting and continuance of a certificate of authority to a
2432domestic title insurer organized as a business trust, if the
2433declaration of trust of such insurer was filed in the department
2434of the Secretary of State prior to January 1, 1959, and if the
2435insurer otherwise meets the applicable requirements of this
2436chapter. Such an insurer may hereinafter in this chapter be
2437referred to as a "business trust insurer."
2438     (7)  For the purpose of satisfying the requirements of ss.
2439637.2004 and 637.2007, the investment portfolio of an insurer
2440applying for an initial certificate of authority to do business
2441in this state shall value its bonds and stocks in accordance
2442with the provisions of the latest edition of the publication
2443"Purposes and Procedures Manual of the NAIC Securities Valuation
2444Office" by the National Association of Insurance Commissioners,
2445July 1, 2002, and subsequent amendments thereto, if the
2446valuation methodology remains substantially unchanged.
2447     637.20035  Structure of title insurers.-Except as to
2448domestic business trust title insurers as referred to in s.
2449637.2003(6) authorized prior to October 1, 2010, a title insurer
2450shall be a stock insurer.
2451     637.2004  Capital funds required; new insurers.-
2452     (1)  To receive authority to transact title insurance, an
2453insurer applying for its original certificate of authority in
2454this state after the effective date of this section shall
2455possess surplus as to policyholders not less than the greater of
2456$2.5 million or 10 percent of the insurer's total liabilities;
2457however, no insurer shall be required under this subsection to
2458have surplus as to policyholders greater than $100 million.
2459     (2)  The requirements of this section shall be based upon
2460all the kinds of insurance actually transacted or to be
2461transacted by the insurer in any and all areas in which it
2462operates, whether or not only a portion of such kinds are to be
2463transacted in this state.
2464     (3)  As to surplus as to policyholders required for
2465qualification to transact one or more kinds of insurance,
2466domestic mutual insurers are governed by chapter 628, and
2467domestic reciprocal insurers are governed by chapter 629.
2468     (4)  For the purposes of this section, liabilities shall
2469not include liabilities required under s. 625.041(4). For
2470purposes of computing minimum surplus as to policyholders
2471pursuant to s. 625.305(1), liabilities shall include liabilities
2472required under s. 625.041(4).
2473     (5)  The provisions of this section, as amended by this
2474act, shall apply only to insurers applying for a certificate of
2475authority on or after the effective date of this act.
2476     637.2005  Restrictions on insurers that are wholly owned
2477subsidiaries of insurers to do business in state.-Effective
2478December 31, 2010, and notwithstanding any other provision of
2479law:
2480     (1)  A new certificate of authority for the transaction of
2481title insurance may not be issued to any insurer domiciled in
2482this state that is a wholly owned subsidiary of an insurer
2483authorized to do business in any other state.
2484     (2)  The rate filings of any insurer domiciled in this
2485state that is a wholly owned subsidiary of an insurer authorized
2486to do business in any other state shall include information
2487relating to the profits of the parent company of the insurer
2488domiciled in this state.
2489     637.2006  Officers and directors of insolvent insurers.-Any
2490person who was an officer or director of an insurer doing
2491business in this state and who served in that capacity within
2492the 2-year period prior to the date the insurer became
2493insolvent, for any insolvency that occurs on or after July 1,
24942002, may not thereafter serve as an officer or director of an
2495insurer authorized in this state unless the officer or director
2496demonstrates that his or her personal actions or omissions were
2497not a significant contributing cause to the insolvency.
2498     637.2007  Surplus as to policyholders required; new and
2499existing insurers.-
2500     (1)  To maintain a certificate of authority to transact
2501title insurance, an insurer in this state shall at all times
2502maintain surplus as to policyholders not less than the greater
2503of $1.5 million or 10 percent of the insurer's total
2504liabilities.
2505     (2)  For purposes of this section, liabilities shall not
2506include liabilities required under s. 625.041(4). For purposes
2507of computing minimum surplus as to policyholders pursuant to s.
2508625.305(1), liabilities shall include liabilities required under
2509s. 625.041(4).
2510     (3)  An insurer may not be required under this section to
2511have surplus as to policyholders greater than $100 million.
2512     Section 5.  Section 625.330, Florida Statutes, is
2513transferred, renumbered as section 627.20073, Florida Statutes,
2514and amended to read:
2515     637.20073 625.330  Special investments by title insurer.-
2516     (1)  In addition to other investments eligible under this
2517part, a title insurer may invest and have invested an amount not
2518exceeding the greater of $300,000 or 50 percent of that part of
2519its surplus as to policyholders which exceeds the minimum
2520surplus required by s. 637.2007 624.408 in its abstract plant
2521and equipment, in loans secured by mortgages on abstract plants
2522and equipment, and, with the consent of the office, in stocks of
2523abstract companies. If the insurer transacts kinds of insurance
2524in addition to title insurance, for the purposes of this section
2525its paid-in capital stock shall be prorated between title
2526insurance and such other insurances upon the basis of the
2527reserves maintained by the insurer for the various kinds of
2528insurance; but the capital so assigned to title insurance may
2529not shall in any no event be less than $100,000.
2530     (2)  Subsection (1) does not apply to a business trust
2531insurer. Such an insurer may invest and have invested not
2532exceeding the greater of $300,000 or 50 percent of its net trust
2533fund in excess of the reserve provided for under s. 637.20075
2534625.111 in abstract plants, stock in abstract companies, or
2535corporations controlled by the business trust and created for
2536developing and servicing abstract plants.
2537     (3)  Investments authorized by this section shall not be
2538credited against the insurer's required unearned premium or
2539guaranty fund reserve provided for under s. 637.20075 625.111.
2540     Section 6.  Section 625.111, Florida Statutes, is
2541transferred, renumbered as section 637.20075, Florida Statutes,
2542and amended to read:
2543     637.20075 625.111  Title insurance reserve.-
2544     (1)  In addition to an adequate reserve as to outstanding
2545losses relating to known claims, as required under s. 625.041, a
2546title insurer shall establish, segregate, and maintain a
2547guaranty fund or unearned premium reserve as provided in this
2548section. The sums required under this section to be reserved for
2549unearned premiums on title guarantees and policies at all times
2550and for all purposes shall be considered and constitute unearned
2551portions of the original premiums and shall be charged as a
2552reserve liability of such insurer in determining its financial
2553condition. While such sums are so reserved, they shall be
2554withdrawn from the use of the insurer for its general purposes,
2555impressed with a trust in favor of the holders of title
2556guarantees and policies, and held available for reinsurance of
2557the title guarantees and policies in the event of the insolvency
2558of the insurer. Nothing contained in this section precludes
2559shall preclude such insurer from investing such reserve in
2560investments authorized by law for such an insurer and the income
2561from such invested reserve shall be included in the general
2562income of the insurer to be used by such insurer for any lawful
2563purpose.
2564     (2)(1)  For unearned premium reserves established on or
2565after July 1, 1999, such unearned premium reserve shall consist
2566of not less than an amount equal to the sum of:
2567     (a)  A reserve with respect to unearned premiums for
2568policies written or title liability assumed in reinsurance
2569before July 1, 1999, equal to the reserve established on June
257030, 1999, for those unearned premiums with such reserve being
2571subsequently released as provided in subsection (3)(2). For
2572domestic title insurers subject to this section, such amounts
2573shall be calculated in accordance with provisions of law of this
2574state in effect at the time the associated premiums were written
2575or assumed and as amended prior to July 1, 1999.
2576     (b)  A total amount equal to 30 cents for each $1,000 of
2577net retained liability for policies written or title liability
2578assumed in reinsurance on or after July 1, 1999, with such
2579reserve being subsequently released as provided in subsection
2580(3)(2). For the purpose of calculating this reserve, the total
2581of the net retained liability for all simultaneous issue
2582policies covering a single risk shall be equal to the liability
2583for the policy with the highest limit covering that single risk,
2584net of any liability ceded in reinsurance.
2585     (c)  An additional amount, if deemed necessary by a
2586qualified actuary, which shall be subsequently released as
2587provided in subsection (3)(2). Using financial results as of
2588December 31 of each year, all domestic title insurers shall
2589obtain a Statement of Actuarial Opinion from a qualified actuary
2590regarding the insurer's loss and loss adjustment expense
2591reserves, including reserves for known claims, adverse
2592development on known claims, incurred but not reported claims,
2593and unallocated loss adjustment expenses. The actuarial opinion
2594shall conform to the annual statement instructions for title
2595insurers adopted by the National Association of Insurance
2596Commissioners and shall include the actuary's professional
2597opinion of the insurer's reserves as of the date of the annual
2598statement. If the amount of the reserve stated in the opinion
2599and displayed in Schedule P of the annual statement for that
2600reporting date is greater than the sum of the known claim
2601reserve and unearned premium reserve as calculated under this
2602section, as of the same reporting date and including any
2603previous actuarial provisions added at earlier dates, the
2604insurer shall add to the insurer's unearned premium reserve an
2605actuarial amount equal to the reserve shown in the actuarial
2606opinion, minus the known claim reserve and the unearned premium
2607reserve, as of the current reporting date and calculated in
2608accordance with this section, but in no event calculated as of
2609any date prior to December 31, 1999. The comparison shall be
2610made using that line on Schedule P displaying the Total Net Loss
2611and Loss Adjustment Expense which is comprised of the Known
2612Claim Reserve, and any associated Adverse Development Reserve,
2613the reserve for Incurred But Not Reported Losses, and
2614Unallocated Loss Adjustment Expenses.
2615     (3)(2)(a)  With respect to the reserve established in
2616accordance with paragraph (2)(1)(a), the domestic title insurer
2617shall release the reserve over a period of 20 subsequent years
2618as provided in this paragraph. The insurer shall release 30
2619percent of the initial aggregate sum during 1999, with one
2620quarter of that amount being released on March 31, June 30,
2621September 30, and December 31, 1999, with the March 31 and June
262230 releases to be retroactive and reflected on the September 30
2623financial statements. Thereafter, the insurer shall release, on
2624the same quarterly basis as specified for reserves released
2625during 1999, a percentage of the initial aggregate sum as
2626follows: 15 percent during calendar year 2000, 10 percent during
2627each of calendar years 2001 and 2002, 5 percent during each of
2628calendar years 2003 and 2004, 3 percent during each of calendar
2629years 2005 and 2006, 2 percent during each of calendar years
26302007-2013, and 1 percent during each of calendar years 2014-
26312018.
2632     (b)  With respect to reserves established in accordance
2633with paragraph (2)(1)(b), the unearned premium for policies
2634written or title liability assumed during a particular calendar
2635year shall be earned, and released from reserve, over a period
2636of 20 subsequent years as provided in this paragraph. The
2637insurer shall release 30 percent of the initial sum during the
2638year next succeeding the year the premium was written or
2639assumed, with one quarter of that amount being released on March
264031, June 30, September 30, and December 31 of such year.
2641Thereafter, the insurer shall release, on the same quarterly
2642basis as specified for reserves released during the year first
2643succeeding the year the premium was written or assumed, a
2644percentage of the initial sum as follows: 15 percent during the
2645next succeeding year, 10 percent during each of the next
2646succeeding 2 years, 5 percent during each of the next succeeding
26472 years, 3 percent during each of the next succeeding 2 years, 2
2648percent during each of the next succeeding 7 years, and 1
2649percent during each of the next succeeding 5 years.
2650     (c)  With respect to reserves established in accordance
2651with paragraph (2)(1)(c), any additional amount established in
2652any calendar year shall be released in the years subsequent to
2653its establishment as provided in paragraph (b), with the timing
2654and percentage of releases being in all respects identical to
2655those of unearned premium reserves that are calculated as
2656provided in paragraph (b) and established with regard to
2657premiums written or liability assumed in reinsurance in the same
2658year as the year in which any additional amount was originally
2659established.
2660     (4)(3)  At any reporting date, the amount of the required
2661releases of existing unearned premium reserves under subsection
2662(3)(2) shall be calculated and deducted from the total unearned
2663premium reserve before any additional amount is established for
2664the current calendar year in accordance with the provisions of
2665paragraph (2)(1)(c).
2666     (5)(4)  As used in this section:
2667     (a)  "Net retained liability" means the total liability
2668retained by a title insurer for a single risk, after taking into
2669account the deduction for ceded liability, if any.
2670     (b)  "Qualified actuary" means a person who is, as detailed
2671in the National Association of Insurance Commissioners' Annual
2672Statement Instructions:
2673     1.  A member in good standing of the Casualty Actuarial
2674Society;
2675     2.  A member in good standing of the American Academy of
2676Actuaries who has been approved as qualified for signing
2677casualty loss reserve opinions by the Casualty Practice Council
2678of the American Academy of Actuaries; or
2679     3.  A person who otherwise has competency in loss reserve
2680evaluation as demonstrated to the satisfaction of the insurance
2681regulatory official of the domiciliary state. In such case, at
2682least 90 days prior to the filing of its annual statement, the
2683insurer must request approval that the person be deemed
2684qualified and that request must be approved or denied. The
2685request must include the National Association of Insurance
2686Commissioners' Biographical Form and a list of all loss reserve
2687opinions issued in the last 3 years by this person.
2688     (c)  "Single risk" means the insured amount of any title
2689insurance policy, except that where two or more title insurance
2690policies are issued simultaneously covering different estates in
2691the same real property, "single risk" means the sum of the
2692insured amounts of all such title insurance policies. Any title
2693insurance policy insuring a mortgage interest, a claim payment
2694under which reduces the insured amount of a fee or leasehold
2695title insurance policy, shall be excluded in computing the
2696amount of a single risk to the extent that the insured amount of
2697the mortgage title insurance policy does not exceed the insured
2698amount of the fee or leasehold title insurance policy.
2699     Section 7.  Sections 637.2008, 637.2009, 637.2011,
2700637.2012, 637.2013, 637.2014, 637.2015, 637.2016, 637.2017,
2701637.2018, 637.2019, 637.2021, 637.2022, 637.2023, 637.2024,
2702637.2025, 637.2026, 637.2027, 637.2028, 637.2029, 637.2031,
2703637.2032, 637.2033, 637.2034, 637.2035, 637.2036, 637.2037,
2704637.2038, 637.2039, 637.2041, 637.2042, 637.2043, 637.2046,
2705637.2047, and 637.2048, Florida Statutes, are created to read:
2706     637.2008  Premiums written; restrictions.-
2707     (1)  Whenever a title insurer's ratio of actual or
2708projected annual written premiums as adjusted in accordance with
2709subsection (4) to current or projected surplus as to
2710policyholders as adjusted in accordance with subsection (6)
2711exceeds 10 to 1 for gross written premiums or exceeds 4 to 1 for
2712net written premiums, the department shall suspend the insurer's
2713certificate of authority or establish by order maximum gross or
2714net annual premiums to be written by the insurer consistent with
2715maintaining the ratios specified herein unless the insurer
2716demonstrates to the department's satisfaction that exceeding the
2717ratios of this section does not endanger the financial condition
2718of the insurer or endanger the interests of the insurer's
2719policyholders.
2720     (2)  Projected annual net or gross premiums shall be based
2721on the actual writings to date for the title insurer's current
2722calendar year or the insurer's writings for the previous
2723calendar year or both. Ratios shall be computed on an annualized
2724basis.
2725     (3)  For the purposes of this section, gross premiums
2726written means direct premiums written and reinsurance assumed.
2727     (4)  For the purposes of this section, for each calendar
2728year premiums shall be calculated as the product of the actual
2729or projected premiums and 1.00.
2730     637.2009  Deposit requirement; domestic title insurers and
2731foreign title insurers.-
2732     (1)  As to domestic title insurers, the department shall
2733not issue or permit to exist a certificate of authority unless
2734such insurer has deposited and maintains deposited in trust for
2735the protection of the insurer's policyholders or its
2736policyholders and creditors with the department securities
2737eligible for such deposit under s. 625.52, having at all times a
2738value of not less than $100,000.
2739     (2)  As to foreign title insurers, the department, upon
2740issuing or permitting to exist a certificate of authority, may
2741require for good cause a deposit and maintenance of the deposit
2742in trust for the protection of the insured's policyholders or
2743its policyholders and creditors with the department securities
2744eligible for such deposit under s. 625.52, having at all times a
2745value of not less than $100,000 A foreign insurer with surplus
2746as to policyholders of more than $10 million according to its
2747latest annual statement shall not be required to make a deposit
2748under this subsection.
2749     (3)  Whenever the department determines that the financial
2750condition of a title insurer has deteriorated or that the
2751policyholders' best interests are not being preserved by the
2752activities of an insurer, the department may require such
2753insurer to deposit and maintain deposited in trust with the
2754department for the protection of the insurer's policyholders or
2755its policyholders and creditors, for such time as the department
2756deems necessary, securities eligible for such deposit under s.
2757625.52, having a market value of not less than the amount which
2758the department determines is necessary, which amount shall be
2759not less than $100,000, or more than 25 percent of the insurer's
2760obligations in this state, as determined from the latest annual
2761financial statement of the insured. The deposit required under
2762this subsection shall not exceed $2 million and is in addition
2763to any other deposits required of an insurer pursuant to
2764subsections (1) and (2) or any other provisions of this chapter.
2765     (4)  All such deposits in this state are subject to the
2766applicable provisions of part III of chapter 625.
2767     637.2011  Deposit of alien insurers.-
2768     (1)  An alien title insurer may not transact insurance in
2769this state unless it has and maintains within the United States
2770as trust deposits with public officials having supervision over
2771insurers, or with trustees, public depositories, or trust
2772institutions approved by the department, assets available for
2773discharge of its United States insurance obligations, which
2774assets shall be in amount not less than the outstanding reserves
2775and other liabilities of the insurer arising out of its
2776insurance transactions in the United States together with the
2777amount of surplus as to policyholders required by s. 637.2007 of
2778a domestic stock insurer transacting like kinds of insurance.
2779     (2)  Any such deposit made in this state shall be held for
2780the protection of the insurer's policyholders or policyholders
2781and creditors in the United States and shall be subject to the
2782applicable provisions of part III of chapter 625 and chapter
2783630.
2784     637.2012  Application for certificate of authority.-
2785     (1)  To apply for a certificate of authority, a title
2786insurer shall file its application therefor with the department,
2787upon a form adopted by the department and furnished by the
2788department, showing its name; location of its home office and,
2789if an alien insurer, its principal office in the United States;
2790kinds of insurance to be transacted; state or country of
2791domicile; and such additional information as the department
2792reasonably requires, together with the following documents:
2793     (a)  One copy of its corporate charter, articles of
2794incorporation, existing and proposed nonfacultative reinsurance
2795contracts, declaration of trust, or other charter documents,
2796with all amendments thereto, certified by the public official
2797with whom the originals are on file in the state or country of
2798domicile.
2799     (b)  If a mutual insurer, a copy of its bylaws, as amended,
2800certified by its secretary or other officer having custody
2801thereof.
2802     (c)  If a foreign or alien reciprocal insurer, a copy of
2803the power of attorney of its attorney in fact and of its
2804subscribers' agreement, if any, certified by the attorney in
2805fact; and, if a domestic reciprocal insurer, the declaration
2806provided for in s. 629.081.
2807     (d)  A copy of its financial statement as of December 31
2808next preceding, containing information generally included in
2809insurer financial statements prepared in accordance with
2810generally accepted insurance accounting principles and practices
2811and in a form generally utilized by insurers for financial
2812statements, sworn to by at least two executive officers of the
2813insurer, or certified by the public official having supervision
2814of insurance in the insurer's state of domicile or of entry into
2815the United States. To facilitate uniformity in financial
2816statements, the department may by rule adopt the form for
2817financial statements approved by the National Association of
2818Insurance Commissioners in 2002, and may adopt subsequent
2819amendments thereto if the form remains substantially consistent.
2820     (e)  Supplemental quarterly financial statements for each
2821calendar quarter since the beginning of the year of its
2822application for the certificate of authority, sworn to by at
2823least two of its executive officers. To facilitate uniformity in
2824financial statements, the department may by rule adopt the form
2825for quarterly financial statements approved by the National
2826Association of Insurance Commissioners in 2002, and may adopt
2827subsequent amendments thereto if the form remains substantially
2828consistent.
2829     (f)  If a foreign or alien insurer, a copy of the report of
2830the most recent examination of the insurer certified by the
2831public official having supervision of insurance in its state of
2832domicile or of entry into the United States. The end of the most
2833recent year covered by the examination must be within the 3-year
2834period preceding the date of application. In lieu of the
2835certified examination report, the department may accept an
2836audited certified public accountant's report prepared on a basis
2837consistent with the insurance laws of the insurer's state of
2838domicile, certified by the public official having supervision of
2839insurance in its state of domicile or of entry into the United
2840States.
2841     (g)  If a foreign or alien insurer, a certificate of
2842compliance from the public official having supervision of
2843insurance in its state or country of domicile showing that it is
2844duly organized and authorized to transact insurance therein and
2845the kinds of insurance it is so authorized to transact.
2846     (h)  If a foreign or alien insurer, a certificate of the
2847public official having custody of any deposit maintained by the
2848insurer in another state in lieu of a deposit or part thereof
2849required in this state under s. 637.2009 or s. 637.2011, showing
2850the amount of such deposit and the assets or securities of which
2851comprised.
2852     (i)  If an alien insurer, a copy of the appointment and
2853authority of its United States manager, certified by its officer
2854having custody of its records.
2855     (2)  The application shall be accompanied by the applicable
2856fees and license tax as specified in s. 637.2031.
2857     637.2013  Redomestication.-The department shall adopt rules
2858establishing procedures and forms for a foreign title insurer to
2859apply for a certificate of authority as a domestic title
2860insurer.
2861     637.2014  Issuance or refusal of authority.-The fee for
2862filing application for a certificate of authority shall not be
2863subject to refund. The department shall issue to the applicant
2864title insurer a proper certificate of authority if it finds that
2865the insurer has met the requirements of this chapter, exclusive
2866of the requirements relative to the filing and approval of an
2867insurer's policy forms, riders, endorsements, applications, and
2868rates. If it does not so find, the department shall issue its
2869order refusing the certificate. The certificate, if issued,
2870shall specify the kind or kinds and line or lines of insurance
2871the insurer is authorized to transact in this state. The
2872issuance of a certificate of authority does not signify that an
2873insurer has met the requirements of this chapter relative to the
2874filing and approval of an insurer's policy forms, riders,
2875endorsements, applications, and rates which may be required
2876prior to an insurer actually writing any premiums.
2877     637.2015  Ownership of certificate of authority; return.-
2878Although issued to the insurer, the certificate of authority is
2879at all times the property of this state. Upon any expiration,
2880suspension, or termination thereof, the insurer shall promptly
2881deliver the certificate of authority to the department.
2882     637.2016  Continuance, expiration, reinstatement, and
2883amendment of certificate of authority.-
2884     (1)  A certificate of authority issued under this chapter
2885shall continue in force as long as the insurer is entitled
2886thereto under this chapter and until suspended, revoked, or
2887terminated at the request of the insurer; subject, however, to
2888continuance of the certificate by the insurer each year by:
2889     (a)  Payment prior to June 1 of the annual license tax
2890provided for in s. 637.2031(3);
2891     (b)  Due filing by the insurer of its annual statement for
2892the calendar year preceding as required under s. 637.2024; and
2893     (c)  Payment by the insurer of applicable taxes with
2894respect to the preceding calendar year as required under this
2895chapter.
2896     (2)  If not so continued by the insurer, its certificate of
2897authority shall expire at midnight on the May 31 next following
2898such failure of the insurer so to continue it in force. The
2899department shall promptly notify the insurer of the occurrence
2900of any failure resulting in impending expiration of its
2901certificate of authority.
2902     (3)  The department may, in its discretion, reinstate a
2903certificate of authority which the insurer has inadvertently
2904permitted to expire, after the insurer has fully cured all its
2905failures which resulted in the expiration, and upon payment by
2906the insurer of the fee for reinstatement, in the amount provided
2907in s. 637.2031(1)(b). Otherwise, the insurer shall be granted
2908another certificate of authority only after filing application
2909therefor and meeting all other requirements as for an original
2910certificate of authority in this state.
2911     (4)  The department may amend a certificate of authority at
2912any time to accord with changes in the insurer's charter or
2913insuring powers.
2914     637.2017  Suspension, revocation of certificate of
2915authority for violations and special grounds.-
2916     (1)  The department shall suspend or revoke a title
2917insurer's certificate of authority if it finds that the insurer:
2918     (a)  Is in unsound financial condition.
2919     (b)  Is using such methods and practices in the conduct of
2920its business as to render its further transaction of insurance
2921in this state hazardous or injurious to its policyholders or to
2922the public.
2923     (c)  Has failed to pay any final judgment rendered against
2924it in this state within 60 days after the judgment became final.
2925     (d)  No longer meets the requirements for the authority
2926originally granted.
2927     (2)  The department may, in its discretion, suspend or
2928revoke the certificate of authority of an insurer if it finds
2929that the insurer:
2930     (a)  Has violated any lawful order or rule of the
2931department or any provision of this chapter.
2932     (b)  Has refused to be examined or to produce its accounts,
2933records, and files for examination, or if any of its officers
2934have refused to give information with respect to its affairs or
2935to perform any other legal obligation as to such examination,
2936when required by the department.
2937     (c)  Has for any line, class, or combination thereof, with
2938such frequency as to indicate its general business practice in
2939this state, without just cause refused to pay proper claims
2940arising under its policies, whether any such claim is in favor
2941of an insured or is in favor of a third person with respect to
2942the liability of an insured to such third person, or without
2943just cause compels such insureds or claimants to accept less
2944than the amount due them or to employ attorneys or to bring suit
2945against the insurer or such an insured to secure full payment or
2946settlement of such claims.
2947     (d)  Is affiliated with and under the same general
2948management or interlocking directorate or ownership as another
2949insurer which transacts direct insurance in this state without
2950having a certificate of authority therefor, except as permitted
2951as to surplus lines insurers under part VIII of chapter 626.
2952     (e)  Has been convicted of, or entered a plea of guilty or
2953nolo contendere to, a felony relating to the transaction of
2954insurance, in this state or in any other state, without regard
2955to whether adjudication was withheld.
2956     (f)  Has a ratio of net premiums written to surplus as to
2957policyholders that exceeds 4 to 1, and the department has reason
2958to believe that the financial condition of the insurer endangers
2959the interests of the policyholders. The ratio of net premiums
2960written to surplus as to policyholders shall be on an annualized
2961actual or projected basis. The ratio shall be based on the
2962insurer's current calendar year activities and experience to
2963date or the insurer's previous calendar year activities and
2964experience, or both, and shall be calculated to represent a 12-
2965month period. However, the provisions of this paragraph do not
2966apply to any insurance or insurer exempted from s. 637.2008.
2967     (g)  Is under suspension or revocation in another state.
2968     (3)  The insolvency or impairment of an insurer constitutes
2969an immediate serious danger to the public health, safety, or
2970welfare; and the department may, at its discretion, without
2971prior notice and the opportunity for hearing immediately suspend
2972the certificate of authority of an insurer upon a determination
2973that:
2974     (a)  The insurer is impaired or insolvent; or
2975     (b)  Receivership, conservatorship, rehabilitation, or
2976other delinquency proceedings have been initiated against the
2977insurer by the public insurance supervisory official of any
2978state.
2979     637.2018  Order, notice of suspension or revocation of
2980certificate of authority; effect; publication.-
2981     (1)  Suspension or revocation of a title insurer's
2982certificate of authority shall be by the order of the
2983department. The department shall promptly also give notice of
2984such suspension or revocation to the insurer's agents in this
2985state of record. The insurer shall not solicit or write any new
2986coverages in this state during the period of any such suspension
2987and may renew coverages only upon a finding by the department
2988that the insurer is capable of servicing the renewal coverage.
2989The insurer shall not solicit or write any new or renewal
2990coverages after any such revocation.
2991     (2)  In its discretion, the department may cause notice of
2992any such suspension or revocation to be published in one or more
2993newspapers of general circulation published in this state.
2994     637.2019  Duration of suspension; insurer's obligations
2995during suspension period; reinstatement.-
2996     (1)  Suspension of a title insurer's certificate of
2997authority shall be for:
2998     (a)  A fixed period of time not to exceed 2 years; or
2999     (b)  Until the occurrence of a specific event necessary for
3000remedying the reasons for suspension.
3001
3002Such suspension may be modified, rescinded, or reversed.
3003     (2)  During the period of suspension, the insurer shall
3004file with the department all documents and information and pay
3005all license fees and taxes as required under this chapter as if
3006the certificate had continued in full force.
3007     (3)  If the suspension of the certificate of authority is
3008for a fixed period of time and the certificate of authority has
3009not been otherwise terminated, upon expiration of the suspension
3010period the insurer's certificate of authority shall be
3011reinstated unless the department finds that the insurer is not
3012in compliance with the requirements of this chapter. The
3013department shall promptly notify the insurer of such
3014reinstatement, and the insurer shall not consider its
3015certificate of authority reinstated until so notified by the
3016department. If not reinstated, the certificate of authority
3017shall be deemed to have expired as of the end of the suspension
3018period or upon failure of the insurer to continue the
3019certificate during the suspension period in accordance with
3020subsection (2), whichever event first occurs.
3021     (4)  If the suspension of the certificate of authority was
3022until the occurrence of a specific event or events and the
3023certificate of authority has not been otherwise terminated, upon
3024the presentation of evidence satisfactory to the department that
3025the specific event or events have occurred, the insurer's
3026certificate of authority shall be reinstated unless the
3027department finds that the insurer is otherwise not in compliance
3028with the requirements of this chapter. The department shall
3029promptly notify the insurer of such reinstatement, and the
3030insurer shall not consider its certificate of authority
3031reinstated until so notified by the department. If satisfactory
3032evidence as to the occurrence of the specific event or events
3033has not been presented to the department within 2 years of the
3034date of such suspension, the certificate of authority shall be
3035deemed to have expired as of 2 years from the date of suspension
3036or upon failure of the insurer to continue the certificate
3037during the suspension period in accordance with subsection (2),
3038whichever first occurs.
3039     (5)  Upon reinstatement of the insurer's certificate of
3040authority, the authority of its agents in this state to
3041represent the insurer shall likewise reinstate. The department
3042shall promptly notify the insurer of such reinstatement.
3043     637.2021  Administrative fine in lieu of suspension or
3044revocation.-
3045     (1)  If the department finds that one or more grounds exist
3046for the discretionary revocation or suspension of a certificate
3047of authority issued under this chapter, the department may, in
3048lieu of such revocation or suspension, impose a fine upon the
3049title insurer.
3050     (2)  With respect to any nonwillful violation, such fine
3051shall not exceed $2,500 per violation. In no event shall such
3052fine exceed an aggregate amount of $10,000 for all nonwillful
3053violations arising out of the same action. When an insurer
3054discovers a nonwillful violation, the insurer shall correct the
3055violation and, if restitution is due, make restitution to all
3056affected persons. Such restitution shall include interest at 12
3057percent per year from either the date of the violation or the
3058date of inception of the affected person's policy, at the
3059insurer's option. The restitution may be a credit against future
3060premiums due provided that the interest shall accumulate until
3061the premiums are due. If the amount of restitution due to any
3062person is $50 or more and the insurer wishes to credit it
3063against future premiums, it shall notify such person that she or
3064he may receive a check instead of a credit. If the credit is on
3065a policy which is not renewed, the insurer shall pay the
3066restitution to the person to whom it is due.
3067     (3)  With respect to any knowing and willful violation of a
3068lawful order or rule of the department or a provision of this
3069chapter, the department may impose a fine upon the insurer in an
3070amount not to exceed $20,000 for each such violation. In no
3071event shall such fine exceed an aggregate amount of $100,000 for
3072all knowing and willful violations arising out of the same
3073action. In addition to such fines, such insurer shall make
3074restitution when due in accordance with the provisions of
3075subsection (2).
3076     (4)  The failure of an insurer to make restitution when due
3077as required under this section constitutes a willful violation
3078of this chapter. However, if an insurer in good faith is
3079uncertain as to whether any restitution is due or as to the
3080amount of such restitution, it shall promptly notify the
3081department of the circumstances; and the failure to make
3082restitution pending a determination thereof shall not constitute
3083a violation of this chapter.
3084     637.2022  Service of process; appointment of Chief
3085Financial Officer as process agent.-
3086     (1)  Each licensed title insurer, whether domestic,
3087foreign, or alien, shall be deemed to have appointed the Chief
3088Financial Officer and her or his successors in department as its
3089attorney to receive service of all legal process issued against
3090it in any civil action or proceeding in this state; and process
3091so served shall be valid and binding upon the insurer.
3092     (2)  Prior to its authorization to transact insurance in
3093this state, each insurer shall file with the department
3094designation of the name and address of the person to whom
3095process against it served upon the Chief Financial Officer is to
3096be forwarded. The insurer may change the designation at any time
3097by a new filing.
3098     (3)  Service of process upon the Chief Financial Officer as
3099the insurer's attorney pursuant to such an appointment shall be
3100the sole method of service of process upon an authorized
3101domestic, foreign, or alien insurer in this state.
3102     637.2023  Serving process.-
3103     (1)  Service of process upon the Chief Financial Officer as
3104process agent of the title insurer under s. 637.2022 shall be
3105made by serving copies in triplicate of the process upon the
3106Chief Financial Officer or upon her or his assistant, deputy, or
3107other person in charge of her or his office. Upon receiving such
3108service, the Chief Financial Officer shall file one copy in her
3109or his office, return one copy with her or his admission of
3110service, and promptly forward one copy of the process by
3111registered or certified mail to the person last designated by
3112the insurer to receive the same, as provided under s.
3113637.2022(2).
3114     (2)  When process is served upon the Chief Financial
3115Officer as an insurer's process agent, the insurer shall not be
3116required to answer or plead except within 20 days after the date
3117upon which the Chief Financial Officer mailed a copy of the
3118process served upon her or him as required by subsection (1).
3119     (3)  Process served upon the Chief Financial Officer and
3120copy thereof forwarded as in this section provided shall for all
3121purposes constitute valid and binding service thereof upon the
3122insurer.
3123     637.2024  Annual statement and other information.-
3124     (1)(a)  Each authorized title insurer shall file with the
3125department full and true statements of its financial condition,
3126transactions, and affairs. An annual statement covering the
3127preceding calendar year shall be filed on or before March 1, and
3128quarterly statements covering the periods ending on March 31,
3129June 30, and September 30 shall be filed within 45 days after
3130each such date. The department may, for good cause, grant an
3131extension of time for filing of an annual or quarterly
3132statement. The statements shall contain information generally
3133included in insurers' financial statements prepared in
3134accordance with generally accepted insurance accounting
3135principles and practices and in a form generally utilized by
3136insurers for financial statements, sworn to by at least two
3137executive officers of the insurer or, if a reciprocal insurer,
3138by the oath of the attorney in fact or its like officer if a
3139corporation. To facilitate uniformity in financial statements
3140and to facilitate department analysis, the department may by
3141rule adopt the form for financial statements approved by the
3142National Association of Insurance Commissioners in 2002, and may
3143adopt subsequent amendments thereto if the methodology remains
3144substantially consistent, and may by rule require each insurer
3145to submit to the department or such organization as the
3146department may designate all or part of the information
3147contained in the financial statement in a computer-readable form
3148compatible with the electronic data processing system specified
3149by the department.
3150     (b)  The department may by rule require reports or filings
3151required under this chapter to be submitted by electronic means
3152in a computer-readable form compatible with the electronic data
3153processing equipment specified by the department.
3154     (2)  The statement of an alien insurer shall be verified by
3155the insurer's United States manager or other officer duly
3156authorized. It shall be a separate statement, to be known as its
3157general statement, of its transactions, assets, and affairs
3158within the United States unless the department requires
3159otherwise. If the department requires a statement as to the
3160insurer's affairs elsewhere, the insurer shall file such
3161statement with the department as soon as reasonably possible.
3162     (3)  At the time of filing, the insurer shall pay the fee
3163for filing its annual statement in the amount specified in s.
3164637.2031.
3165     (4)  The department may refuse to continue, or may suspend
3166or revoke, the certificate of authority of an insurer failing to
3167file its annual or quarterly statements and accompanying
3168certificates when due.
3169     (5)  In addition to information called for and furnished in
3170connection with its annual or quarterly statements, an insurer
3171shall furnish to the department as soon as reasonably possible
3172such information as to its transactions or affairs as the
3173department may from time to time request in writing. All such
3174information furnished pursuant to the department's request shall
3175be verified by the oath of two executive officers of the insurer
3176or, if a reciprocal insurer, by the oath of the attorney in fact
3177or its like officers if a corporation.
3178     (6)  The signatures of all such persons when written on
3179annual or quarterly statements or other reports required by this
3180section shall be presumed to have been so written by authority
3181of the person whose signature is affixed thereon. The affixing
3182of any signature by anyone other than the purported signer
3183constitutes a felony of the second degree, punishable as
3184provided in s. 775.082, s. 775.083, or s. 775.084.
3185     (7)(a)  All authorized insurers must have conducted an
3186annual audit by an independent certified public accountant and
3187must file an audited financial report with the department on or
3188before June 1 for the preceding year ending December 31. The
3189department may require an insurer to file an audited financial
3190report earlier than June 1 upon 90 days' advance notice to the
3191insurer. The department may immediately suspend an insurer's
3192certificate of authority by order if an insurer's failure to
3193file required reports, financial statements, or information
3194required by this subsection or rule adopted pursuant thereto
3195creates a significant uncertainty as to the insurer's continuing
3196eligibility for a certificate of authority.
3197     (b)  Any authorized insurer otherwise subject to this
3198section having direct premiums written in this state of less
3199than $1 million in any calendar year and fewer than 1,000
3200policyholders or certificateholders of directly written policies
3201nationwide at the end of such calendar year is exempt from this
3202section for such year unless the department makes a specific
3203finding that compliance is necessary in order for the department
3204to carry out its statutory responsibilities. However, any
3205insurer having assumed premiums pursuant to contracts or
3206treaties or reinsurance of $1 million or more is not exempt. Any
3207insurer subject to an exemption must submit by March 1 following
3208the year to which the exemption applies an affidavit sworn to by
3209a responsible officer of the insurer specifying the amount of
3210direct premiums written in this state and number of
3211policyholders or certificateholders.
3212     (c)  The board of directors of an insurer shall hire the
3213certified public accountant that prepares the audit required by
3214this subsection and the board shall establish an audit committee
3215of three or more directors of the insurer or an affiliated
3216company. The audit committee shall be responsible for discussing
3217audit findings and interacting with the certified public
3218accountant with regard to her or his findings. The audit
3219committee shall be comprised solely of members who are free from
3220any relationship that, in the opinion of its board of directors,
3221would interfere with the exercise of independent judgment as a
3222committee member. The audit committee shall report to the board
3223any findings of adverse financial conditions or significant
3224deficiencies in internal controls that have been noted by the
3225accountant. The insurer may request the department to waive this
3226requirement of the audit committee membership based upon unusual
3227hardship to the insurer.
3228     (d)  An insurer may not use the same accountant or partner
3229of an accounting firm responsible for preparing the report
3230required by this subsection for more than 7 consecutive years.
3231Following this period, the insurer may not use such accountant
3232or partner for a period of 2 years, but may use another
3233accountant or partner of the same firm. An insurer may request
3234the department to waive this prohibition based upon an unusual
3235hardship to the insurer and a determination that the accountant
3236is exercising independent judgment that is not unduly influenced
3237by the insurer considering such factors as the number of
3238partners, expertise of the partners or the number of insurance
3239clients of the accounting firm; the premium volume of the
3240insurer; and the number of jurisdictions in which the insurer
3241transacts business.
3242     (e)  The department shall adopt rules to implement this
3243subsection, which rules must be in substantial conformity with
3244the 1998 Model Rule Requiring Annual Audited Financial Reports
3245adopted by the National Association of Insurance Commissioners,
3246except where inconsistent with the requirements of this
3247subsection. Any exception to, waiver of, or interpretation of
3248accounting requirements of the department must be in writing and
3249signed by an authorized representative of the department. No
3250insurer may raise as a defense in any action, any exception to,
3251waiver of, or interpretation of accounting requirements, unless
3252previously issued in writing by an authorized representative of
3253the department.
3254     637.2025  NAIC filing requirements.-
3255     (1)  Each domestic, foreign, and alien title insurer who is
3256authorized to transact title insurance in this state shall file
3257one extra copy of its annual statement convention blank, along
3258with such additional filings as prescribed by the department for
3259the preceding year. Such extra copy shall be for the explicit
3260purpose of allowing the department to forward it to the National
3261Association of Insurance Commissioners.
3262     (2)  Coincident with the filing of the documents required
3263in subsection (1), each insurer shall pay to the department a
3264reasonable fee to cover the costs associated with the filing and
3265analysis of the documents by the National Association of
3266Insurance Commissioners and the department.
3267     (3)  The provisions of this section shall not apply to any
3268foreign, domestic, or alien insurer which has filed such
3269documents directly with the National Association of Insurance
3270Commissioners if the National Association of Insurance
3271Commissioners has certified receipt of the required documents to
3272the department.
3273     637.2026  Change in controlling interest of foreign or
3274alien title insurer; report required.-In the event of a change
3275in the controlling capital stock or a change of 50 percent or
3276more of the assets of a foreign or alien title insurer, such
3277insurer shall report such change in writing to the department
3278within 30 days of the effective date thereof. The report shall
3279contain the name and address of the new owner or owners of the
3280controlling stock or assets, the nature and value of the new
3281assets, and such other relevant information as the department
3282may reasonably require. For the purposes of this section, the
3283term "controlling capital stock" means a sufficient number of
3284shares of the issued and outstanding capital stock of such
3285insurer or person so as to give the owner thereof power to
3286exercise a controlling influence over the management or policies
3287of such insurer or person.
3288     637.2027  Withdrawal of title insurer or discontinuance of
3289writing insurance.-
3290     (1)  Any title insurer desiring to surrender its
3291certificate of authority, withdraw from this state, or
3292discontinue the writing of title insurance in this state shall
3293give 90 days' notice in writing to the department setting forth
3294its reasons for such action. Any insurer who does not write any
3295premiums within a calendar year shall have title insurance
3296removed from its certificate of authority; however, such line of
3297insurance shall be restored to the insurer's certificate upon
3298the insurer demonstrating that it has available the expertise
3299necessary and meets the other requirements of this chapter to
3300write that line of insurance.
3301     (2)  If the department determines, based upon its review of
3302the notice and other required information, that the plan of an
3303insurer withdrawing from this state makes adequate provision for
3304the satisfaction of the insurer's obligations and is not
3305hazardous to policyholders or the public, the department shall
3306approve the surrender of the insurer's certificate of authority.
3307The department shall, within 45 days from receipt of a complete
3308notice and all required or requested additional information,
3309approve, disapprove, or approve with conditions the plan
3310submitted by the insurer. Failure to timely take action with
3311respect to the notice shall be deemed an approval of the
3312surrender of the certificate of authority.
3313     (3)  Any insurer withdrawing from this state or
3314discontinuing the writing of insurance in this state shall
3315surrender its certificate of authority.
3316     (4)  This section does not apply to insurers during the
3317calendar year in which they first receive their certificate of
3318authority.
3319     (5)  This section does not apply to insurers who have
3320discontinued writing in accordance with an order issued by the
3321department.
3322     (6)  Notwithstanding subsection (5), any insurer desiring
3323to surrender its certificate of authority, withdraw from this
3324state, or discontinue the writing of insurance in this state is
3325expected to have availed itself of all reasonably available
3326reinsurance. Reasonably available reinsurance shall include
3327unrealized reinsurance, which is defined as reinsurance
3328recoverable on known losses incurred and due under valid
3329reinsurance contracts that have not been identified in the
3330normal course of business and have not been reported in
3331financial statements filed with the department. Within 90 days
3332after surrendering its certificate of authority, withdrawing
3333from this state, or discontinuing the writing of any one or
3334multiple kinds or lines of insurance in this state, the insurer
3335shall certify to the department that the insurer has engaged an
3336independent third party to search for unrealized reinsurance,
3337and that the insurer has made all relevant books and records
3338available to such third party. The compensation to such third
3339party may be a percentage of unrealized reinsurance identified
3340and collected.
3341     (7)  The department may adopt rules to administer this
3342section.
3343     637.2028  Assets of title insurers; reporting
3344requirements.-
3345     (1)  As used in this section, the term "material
3346acquisition of assets" or "material disposition of assets" means
3347one or more transactions occurring during any 30-day period
3348which are nonrecurring and not in the ordinary course of
3349business and involve more than 5 percent of the reporting title
3350insurer's total admitted assets as reported in its most recent
3351statutory statement filed with the insurance department of the
3352insurer's state of domicile.
3353     (2)  Each domestic title insurer shall file a report with
3354the department disclosing a material acquisition of assets, a
3355material disposition of assets, or a material nonrenewal,
3356cancellation, or revision of a ceded reinsurance agreement,
3357unless the material acquisition or disposition of assets or the
3358material nonrenewal, cancellation, or revision of a ceded
3359reinsurance agreement has been submitted to the department for
3360review, approval, or informational purposes under another
3361section of this chapter or a rule adopted thereunder. A copy of
3362the report and each exhibit or other attachment must be filed by
3363the insurer with the National Association of Insurance
3364Commissioners. The report required in this section is due within
336515 days after the end of the calendar month in which the
3366transaction occurs.
3367     (3)  An immaterial acquisition or disposition of assets
3368need not be reported under this section.
3369     (4)(a)  Acquisitions of assets which are subject to this
3370section include each purchase, lease, exchange, merger,
3371consolidation, succession, or other acquisition of assets. Asset
3372acquisitions for the construction or development of real
3373property by or for the reporting insurer and the acquisition of
3374construction materials for this purpose are not subject to this
3375section.
3376     (b)  Dispositions of assets which are subject to this
3377section include each sale, lease, exchange, merger,
3378consolidation, mortgage, hypothecation, assignment for the
3379benefit of a creditor or otherwise, abandonment, destruction, or
3380other disposition of assets.
3381     (5)(a)  The following information must be disclosed in any
3382report of a material acquisition or disposition of assets:
3383     1.  The date of the transaction.
3384     2.  The manner of acquisition or disposition.
3385     3.  The description of the assets involved.
3386     4.  The nature and amount of the consideration given or
3387received.
3388     5.  The purpose of, or reason for, the transaction.
3389     6.  The manner by which the amount of consideration was
3390determined.
3391     7.  The gain or loss recognized or realized as a result of
3392the transaction.
3393     8.  The name of the person from whom the assets were
3394acquired or to whom they were disposed.
3395     (b)  Insurers must report material acquisitions or
3396dispositions on a nonconsolidated basis unless the insurer is
3397part of a consolidated group of insurers which uses a pooling
3398arrangement or a 100-percent reinsurance agreement that affects
3399the solvency and integrity of the insurer's reserves and the
3400insurer has ceded substantially all of its direct and assumed
3401business to the pool. An insurer is deemed to have ceded
3402substantially all of its direct and assumed business to a pool
3403if the insurer has less than $1 million in total direct and
3404assumed written premiums during a calendar year which are not
3405subject to a pooling arrangement and if the net income of the
3406business which is not subject to the pooling arrangement
3407represents less than 5 percent of the insurer's capital and
3408surplus.
3409     (6)(a)  The following information must be disclosed in any
3410report of a material nonrenewal, cancellation, or revision of a
3411ceded reinsurance agreement:
3412     1.  The effective date of the nonrenewal, cancellation, or
3413revision.
3414     2.  The description of the transaction and the
3415identification of the initiator of the transaction.
3416     3.  The purpose of, or reason for, the transaction.
3417     4.  If applicable, the identity of each replacement
3418reinsurer.
3419     (b)  Insurers shall report the material nonrenewal,
3420cancellation, or revision of a ceded reinsurance agreement on a
3421nonconsolidated basis unless the insurer is part of a
3422consolidated group of insurers which uses a pooling arrangement
3423or a 100-percent reinsurance agreement that affects the solvency
3424and integrity of the insurer's reserves and the insurer has
3425ceded substantially all of its direct and assumed business to
3426the pool. An insurer is deemed to have ceded substantially all
3427of its direct and assumed business to a pool if the insurer has
3428less than $1 million in total direct and assumed written
3429premiums during a calendar year which are not subject to a
3430pooling arrangement and if the net income of the business not
3431subject to the pooling arrangement represents less than 5
3432percent of the insurer's capital and surplus.
3433     637.2029  Participation of financial institutions in
3434reinsurance and in insurance exchanges.-Subject to applicable
3435laws relating to financial institutions and to any other
3436applicable provision of this chapter, any financial institution
3437or aggregation of such institutions may own or control, directly
3438or indirectly, any title insurer which is authorized or approved
3439by the department, which insurer transacts only reinsurance in
3440this state and which actively engages in reinsuring risks
3441located in this state. Nothing in this section shall be deemed
3442to prohibit a financial institution from engaging in any
3443presently authorized insurance activity.
3444     637.2031  Filing, license, appointment, and miscellaneous
3445fees.-The department shall collect in advance, and persons so
3446served shall pay to it in advance, fees, licenses, and
3447miscellaneous charges as follows:
3448     (1)  Certificate of authority of title insurer.
3449     (a)  Filing application for original certificate of
3450authority or modification thereof as a result of a merger,
3451acquisition, or change of controlling interest due to a sale or
3452exchange of stock, including all documents required to be filed
3453therewith, filing fee....$1,500.00
3454     (b)  Reinstatement fee....$50.00
3455     (2)  Charter documents of insurer.
3456     (a)  Filing articles of incorporation or other charter
3457documents, other than at time of application for original
3458certificate of authority, filing fee....$10.00
3459     (b)  Filing amendment to articles of incorporation or
3460charter, other than at time of application for original
3461certificate of authority, filing fee....$5.00
3462     (c)  Filing bylaws, when required, or amendments thereof,
3463filing fee....$5.00
3464     (3)  Annual license tax of insurer, each domestic insurer,
3465foreign insurer, and alien insurer (except that, as to fraternal
3466benefit societies insuring less than 200 members in this state
3467and the members of which as a prerequisite to membership possess
3468a physical handicap or disability, such license tax shall be
3469$25)....$1,000.00
3470     (4)  Statements of insurer, filing (except when filed as
3471part of application for original certificate of authority),
3472filing fees:
3473     (a)  Annual statement....$250.00
3474     (b)  Quarterly statement....$250.00
3475     (5)  All insurance representatives, application for
3476license, each filing, filing fee....$50.00
3477     (6)  Examination-Fee to cover actual cost of examination.
3478     (7)  Temporary license and appointment as agent where
3479expressly provided for, rate of fee for each month of the period
3480for which the license and appointment is issued....$5.00
3481     (8)  Issuance, reissuance, reinstatement, modification
3482resulting in a modified license being issued, duplicate copy of
3483any insurance representative license, or an appointment being
3484reinstated....$5.00
3485     (9)  Additional appointment continuation fees as prescribed
3486in chapter 626....$5.00
3487     (10)  Filing application for permit to form insurer as
3488referred to in chapter 628, filing fee....$25.00
3489     (11)  Annual license fee of rating organization, each
3490domestic or foreign organization....$25.00
3491     (12)  Miscellaneous services:
3492     (a)  For copies of documents or records on file with the
3493department, per page....$ .50
3494     (b)  For each certificate of the department, under its
3495seal, authenticating any document or other instrument (other
3496than a license or certificate of authority)....$5.00
3497     (c)  For preparing lists of agents and other insurance
3498representatives, and for other miscellaneous services, such
3499reasonable charge as may be fixed by the department.
3500     (d)  For processing requests for approval of continuing
3501education courses, processing fee....$100.00
3502     (13)  Fingerprint processing-Fee to cover fingerprint
3503processing.
3504     (14)  Title insurance agents:
3505     (a)  Agent's original appointment or biennial renewal or
3506continuation thereof, each insurer:
3507     Appointment fee....$42.00
3508     State tax....12.00
3509     County tax....6.00
3510Total....$60.00
3511     (b)  Agency original appointment or biennial renewal or
3512continuation thereof, each insurer:
3513     Appointment fee....$42.00
3514     State tax....12.00
3515     County tax....6.00
3516Total....$60.00
3517     (c)  Filing for title insurance agent's license:
3518     Application for filing, each filing, filing fee....$10.00
3519     (d)  Additional appointment continuation fee as prescribed
3520by s. 637.3015....$5.00
3521     (e)  Title insurer and title insurance agency
3522administrative surcharge:
3523     1.  On or before January 30 of each calendar year, each
3524title insurer shall pay to the department for each licensed
3525title insurance agency appointed by the title insurer and for
3526each retail office of the insurer on January 1 of that calendar
3527year an administrative surcharge of $200.00.
3528     2.  On or before January 30 of each calendar year, each
3529licensed title insurance agency shall remit to the department an
3530administrative surcharge of $200.00.
3531
3532The administrative surcharge may be used solely to defray the
3533costs to the department in their examination or audit of title
3534insurance agencies and retail offices of title insurers and to
3535gather title insurance data for statistical purposes to be
3536furnished to and used by the department in its regulation of
3537title insurance.
3538     (15)  Late filing of appointment renewals for agents,
3539adjusters, and other insurance representatives, each
3540appointment....$20.00
3541     637.2032  Advance collection of fees and taxes; title
3542insurers not to pay without reimbursement.-
3543     (1)  The department shall collect in advance from the
3544applicant or licensee fees and taxes as provided in s. 637.2031.
3545     (2)  A title insurer shall not pay directly or indirectly
3546without reimbursement from a title insurance agent any
3547appointment fee required under this section. The failure of a
3548title insurance agent to make reimbursement is not a ground for
3549cancellation of the title insurance agent's appointment by the
3550title insurer.
3551     637.2033  Service of process fee.-In all instances as
3552provided in any section of this chapter and s. 48.151(3) in
3553which service of process is authorized to be made upon the Chief
3554Financial Officer , the plaintiff shall pay to the department a
3555fee of $15 for such service of process, which fee shall be
3556deposited into the Title Insurance Regulatory Trust Fund.
3557     637.2034  Liability for state, county tax.-Each authorized
3558title insurer that uses insurance agents in this state shall be
3559liable for and shall pay the state and county taxes required
3560therefor under s. 637.2031 or s. 637.2035.
3561     637.2035  County tax; determination; additional offices;
3562nonresident agents.-
3563     (1)  The county tax provided for under s. 637.2031 as to an
3564agent shall be paid by each title insurer for each agent only
3565for the county where the agent resides, or if such agent's place
3566of business is located in a county other than that of her or his
3567residence, then for the county wherein is located such place of
3568business. If an agent maintains an office or place of business
3569in more than one county, the tax shall be paid for her or him by
3570each such insurer for each county wherein the agent represents
3571such insurer and has a place of business. When under this
3572subsection an insurer is required to pay county tax for an agent
3573for a county or counties other than the agent's county of
3574residence, the insurer shall designate the county or counties
3575for which the taxes are paid.
3576     (2)  A county tax of $3 per year shall be paid by each
3577insurer for each county in this state in which an agent who
3578resides outside of this state represents and engages in person
3579in the activities of an agent for the insurer. This provision
3580shall not be deemed to authorize any activities by an agent
3581which are otherwise prohibited under this chapter.
3582     637.2036  County tax; deposit and remittance.-
3583     (1)  The department shall deposit in the Agents County Tax
3584Trust Fund all moneys accepted as county tax under this chapter.
3585She or he shall keep a separate account for all moneys so
3586collected for each county and, after deducting therefrom the
3587service charges provided for in s. 215.20, shall remit the
3588balance to the counties.
3589     (2)  The payment and collection of county tax under this
3590chapter shall be in lieu of collection thereof by the respective
3591county tax collectors.
3592     (3)  The Chief Financial Officer shall annually, as of
3593January 1 following the date of collection, and thereafter at
3594such other times as she or he may elect, draw her or his
3595warrants on the State Treasury payable to the respective
3596counties entitled to receive the same for the full net amount of
3597such taxes to each county.
3598     637.2037  Municipal tax.-Municipal corporations may require
3599a tax of title insurance agents not to exceed 50 percent of the
3600state tax specified as to such agents under this chapter, and
3601unless otherwise authorized by law. Such a tax may be required
3602only by a municipal corporation within the boundaries of which
3603is located the agent's business office, or if no such office is
3604required under this chapter, by the municipal corporation of the
3605agent's place of residence.
3606     637.2038  Insurer's license tax; when payable.-
3607     (1)  The title insurer's license tax provided for in s.
3608637.2031(3) shall be paid by an insurer newly applying for a
3609certificate of authority to transact insurance in this state
3610prior to and contingent upon the issuance of its original
3611certificate of authority. If the certificate of authority is not
3612issued, the license tax payment shall be refunded to the
3613insurer. The license tax so paid by a newly authorized insurer
3614shall cover the period expiring on the June 1 following the date
3615of its original certificate of authority.
3616     (2)  Each authorized title insurer shall pay the license
3617tax annually on or before June 1.
3618     637.2039  Premium tax; rate and computation.-
3619     (1)  In addition to the license taxes provided for in this
3620chapter, each title insurer shall also annually, and on or
3621before March 1 in each year, pay to the Department of Revenue a
3622tax on premiums for title insurance received during the
3623preceding calendar year an amount equal to 1.75 percent of the
3624gross amount of such receipts on account of all policies and
3625covering property, subjects, or risks located, resident, or to
3626be performed in this state, omitting premiums on reinsurance
3627accepted, and less return premiums or assessments, but without
3628deductions:
3629     (a)  For reinsurance ceded to other insurers;
3630     (b)  For moneys paid upon surrender of policies or
3631certificates for cash surrender value.
3632     (2)  Payment by the insurer of the license taxes and
3633premium receipts taxes provided for in this chapter is a
3634condition precedent to doing business within this state.
3635     (3)  Notwithstanding other provisions of law, the
3636distribution of the premium tax and any penalties or interest
3637collected thereunder shall be made to the General Revenue Fund
3638in accordance with rules adopted by the Department of Revenue
3639and approved by the Administration Commission.
3640     (4)  The income tax imposed under chapter 220 and the
3641emergency excise tax imposed under chapter 221 which are paid by
3642any insurer shall be credited against, and to the extent thereof
3643shall discharge, the liability for tax imposed by this section
3644for the annual period in which such tax payments are made. For
3645purposes of this subsection, payments of estimated income tax
3646under chapter 220 and of estimated emergency excise tax under
3647chapter 221 shall be deemed paid at the time the insurer
3648actually files its annual returns under chapter 220 or at the
3649time such returns are required to be filed, whichever first
3650occurs, and not at such earlier time as such payments of
3651estimated tax are actually made.
3652     (5)(a)1.  There shall be allowed a credit against the net
3653tax imposed by this section equal to 15 percent of the amount
3654paid by an insurer in salaries to employees located or based
3655within this state and who are covered by the provisions of
3656chapter 443.
3657     2.  As an alternative to the credit allowed in subparagraph
36581., an affiliated group of corporations which includes at least
3659one insurance company writing premiums in this state may elect
3660to take a credit against the net tax imposed by this section in
3661an amount that may not exceed 15 percent of the salary of the
3662employees of the affiliated group of corporations who perform
3663insurance-related activities, are located or based within this
3664state, and are covered by chapter 443. For purposes of this
3665subparagraph, the term "affiliated group of corporations" means
3666two or more corporations that are entirely owned directly or
3667indirectly by a single corporation and that constitute an
3668affiliated group as defined in s. 1504(a) of the Internal
3669Revenue Code. The amount of credit allowed under this
3670subparagraph is limited to the combined Florida salary tax
3671credits allowed for all insurance companies that were members of
3672the affiliated group of corporations for the tax year ending
3673December 31, 2002, divided by the combined Florida taxable
3674premiums written by all insurance companies that were members of
3675the affiliated group of corporations for the tax year ending
3676December 31, 2002, multiplied by the combined Florida taxable
3677premiums of the affiliated group of corporations for the current
3678year. An affiliated group of corporations electing this
3679alternative calculation method must make such election on or
3680before August 1, 2005. The election of this alternative
3681calculation method is irrevocable and binding upon successors
3682and assigns of the affiliated group of corporations electing
3683this alternative. However, if a member of an affiliated group of
3684corporations acquires or merges with another insurance company
3685after the date of the irrevocable election, the acquired or
3686merged company is not entitled to the affiliated group election
3687and shall only be entitled to calculate the tax credit under
3688subparagraph 1.
3689
3690In no event shall the salary paid to an employee by an
3691affiliated group of corporations be claimed as a credit by more
3692than one insurer or be counted more than once in an insurer's
3693calculation of the credit as described in subparagraph 1. or
3694subparagraph 2. Only the portion of an employee's salary paid
3695for the performance of insurance-related activities may be
3696included in the calculation of the premium tax credit in this
3697subsection.
3698     (b)  For purposes of this subsection:
3699     1.  The term "salaries" does not include amounts paid as
3700commissions.
3701     2.  The term "employees" does not include independent
3702contractors or any person whose duties require that the person
3703hold a valid license under the Florida Insurance Code, except
3704adjusters, managing general agents, and service representatives,
3705as defined in s. 626.015.
3706     3.  The term "net tax" means the tax imposed by this
3707section after applying the calculations and credits set forth in
3708subsection (4).
3709     4.  An affiliated group of corporations that created a
3710service company within its affiliated group on July 30, 2002,
3711shall allocate the salary of each service company employee
3712covered by contracts with affiliated group members to the
3713companies for which the employees perform services. The salary
3714allocation is based on the amount of time during the tax year
3715that the individual employee spends performing services or
3716otherwise working for each company over the total amount of time
3717the employee spends performing services or otherwise working for
3718all companies. The total amount of salary allocated to an
3719insurance company within the affiliated group shall be included
3720as that insurer's employee salaries for purposes of this
3721section.
3722     a.  Except as provided in subparagraph (a)2., the term
3723"affiliated group of corporations" means two or more
3724corporations that are entirely owned by a single corporation and
3725that constitute an affiliated group of corporations as defined
3726in s. 1504(a) of the Internal Revenue Code.
3727     b.  The term "service company" means a separate corporation
3728within the affiliated group of corporations whose employees
3729provide services to affiliated group members and which are
3730treated as service company employees for unemployment
3731compensation and common law purposes. The holding company of an
3732affiliated group may not qualify as a service company. An
3733insurance company may not qualify as a service company.
3734     c.  If an insurance company fails to substantiate, whether
3735by means of adequate records or otherwise, its eligibility to
3736claim the service company exception under this section, or its
3737salary allocation under this section, no credit shall be
3738allowed.
3739     5.  A service company that is a subsidiary of a mutual
3740insurance holding company, which mutual insurance holding
3741company was in existence on or before January 1, 2000, shall
3742allocate the salary of each service company employee covered by
3743contracts with members of the mutual insurance holding company
3744system to the companies for which the employees perform
3745services. The salary allocation is based on the ratio of the
3746amount of time during the tax year which the individual employee
3747spends performing services or otherwise working for each company
3748to the total amount of time the employee spends performing
3749services or otherwise working for all companies. The total
3750amount of salary allocated to an insurance company within the
3751mutual insurance holding company system shall be included as
3752that insurer's employee salaries for purposes of this section.
3753However, this subparagraph does not apply for any tax year
3754unless funds sufficient to offset the anticipated salary credits
3755have been appropriated to the General Revenue Fund prior to the
3756due date of the final return for that year.
3757     a.  The term "mutual insurance holding company system"
3758means two or more corporations that are subsidiaries of a mutual
3759insurance holding company and in compliance with part IV of
3760chapter 628.
3761     b.  The term "service company" means a separate corporation
3762within the mutual insurance holding company system whose
3763employees provide services to other members of the mutual
3764insurance holding company system and are treated as service
3765company employees for unemployment compensation and common-law
3766purposes. The mutual insurance holding company may not qualify
3767as a service company.
3768     c.  If an insurance company fails to substantiate, whether
3769by means of adequate records or otherwise, its eligibility to
3770claim the service company exception under this section, or its
3771salary allocation under this section, no credit shall be
3772allowed.
3773     (c)  The department may adopt rules pursuant to ss.
3774120.536(1) and 120.54 to administer this subsection.
3775     (6)(a)  The total of the credit granted for the taxes paid
3776by the insurer under chapters 220 and 221 and the credit granted
3777by subsection (5) shall not exceed 65 percent of the tax due
3778under subsection (1) after deducting therefrom the taxes paid by
3779the insurer under ss. 175.101 and 185.08 and any assessments
3780pursuant to s. 440.51.
3781     (b)  To the extent that any credits granted by subsection
3782(5) remain as a result of the limitation set forth in paragraph
3783(a), such excess credits related to salaries and wages of
3784employees whose place of employment is located within an
3785enterprise zone created pursuant to chapter 290 may be
3786transferred, in an aggregate amount not to exceed 25 percent of
3787such excess salary credits, to any insurer that is a member of
3788an affiliated group of corporations, as defined in sub-
3789subparagraph (5)(b)4.a., that includes the original insurer
3790qualifying for the credits under subsection (5). The amount of
3791such excess credits to be transferred shall be calculated by
3792multiplying the amount of such excess credits by a fraction, the
3793numerator of which is the sum of the salaries qualifying for the
3794credit allowed by subsection (5) of employees whose place of
3795employment is located in an enterprise zone and the denominator
3796of which is the sum of the salaries qualifying for the credit
3797allowed by subsection (5). Any such transferred credits shall be
3798subject to the same provisions and limitations set forth within
3799this chapter. The provisions of this paragraph do not apply to
3800an affiliated group of corporations that participate in a common
3801paymaster arrangement as defined in s. 443.1216.
3802     (7)  Credits and deductions against the tax imposed by this
3803section shall be taken in the following order: deductions for
3804assessments made pursuant to s. 440.51; credits for taxes paid
3805under ss. 175.101 and 185.08; credits for income taxes paid
3806under chapter 220, the emergency excise tax paid under chapter
3807221 and the credit allowed under subsection (5), as these
3808credits are limited by subsection (6); all other available
3809credits and deductions.
3810     (8)  As used in this section "insurer" includes any entity
3811subject to the tax imposed by this section.
3812     637.2041  Retaliatory provision, insurers.-
3813     (1)(a)  When by or pursuant to the laws of any other state
3814or foreign country any taxes, licenses, and other fees, in the
3815aggregate, and any fines, penalties, deposit requirements, or
3816other material obligations, prohibitions, or restrictions are or
3817would be imposed upon title insurers in this state or upon the
3818agents or representatives of such insurers, which are in excess
3819of such taxes, licenses, and other fees, in the aggregate, or
3820which are in excess of the fines, penalties, deposit
3821requirements, or other obligations, prohibitions, or
3822restrictions directly imposed upon similar insurers, or upon the
3823agents or representatives of such insurers, of such other state
3824or country under the statutes of this state, so long as such
3825laws of such other state or country continue in force or are so
3826applied, the same taxes, licenses, and other fees, in the
3827aggregate, or fines, penalties, deposit requirements, or other
3828material obligations, prohibitions, or restrictions of whatever
3829kind shall be imposed by the Department of Revenue upon the
3830insurers, or upon the agents or representatives of such
3831insurers, of such other state or country doing business or
3832seeking to do business in this state. In determining the taxes
3833to be imposed under this section, 80 percent and a portion of
3834the remaining 20 percent as provided in paragraph (b) of the
3835credit provided by s. 637.2039(5), as limited by s. 637.2039(6)
3836and further determined by s. 637.2039(7), shall not be taken
3837into consideration.
3838     (b)  As used in this subsection, the term "portion of the
3839remaining 20 percent" shall be calculated by multiplying the
3840remaining 20 percent by a fraction, the numerator of which is
3841the sum of the salaries qualifying for the credit allowed by s.
3842637.2039(5) of employees whose place of employment is located in
3843an enterprise zone created pursuant to chapter 290 and the
3844denominator of which is the sum of the salaries qualifying for
3845the credit allowed by s. 637.2039(5).
3846     (2)  Any tax, license, or other obligation imposed by any
3847city, county, or other political subdivision or agency of a
3848state, jurisdiction, or foreign country on Florida title
3849insurers or their agents or representatives shall be deemed to
3850be imposed by such state, jurisdiction, or foreign country
3851within the meaning of subsection (1).
3852     (3)  This section does not apply as to personal income
3853taxes, nor as to sales or use taxes, nor as to ad valorem taxes
3854on real or personal property, nor as to reimbursement premiums
3855paid to the Florida Hurricane Catastrophe Fund, nor as to
3856emergency assessments paid to the Florida Hurricane Catastrophe
3857Fund, nor as to special purpose obligations or assessments
3858imposed in connection with particular kinds of insurance other
3859than property insurance, except that deductions, from premium
3860taxes or other taxes otherwise payable, allowed on account of
3861real estate or personal property taxes paid shall be taken into
3862consideration by the department in determining the propriety and
3863extent of retaliatory action under this section.
3864     (4)  For the purposes of this section, a "similar insurer"
3865is an insurer with identical premiums, personnel, and property
3866to that of the alien or foreign insurer's Florida premiums,
3867personnel, and property. The similar insurer's premiums,
3868personnel, and property shall be used to calculate any taxes,
3869licenses, other fees, in the aggregate, or any fines, penalties,
3870deposit requirements, or other material obligations,
3871prohibitions, or restrictions that are or would be imposed under
3872the laws of this state and under the law of the foreign or alien
3873insurer's state of domicile.
3874     (5)  The excess amount of all fees, licenses, and taxes
3875collected by the Department of Revenue under this section over
3876the amount of similar fees, licenses, and taxes provided for in
3877this part, together with all fines, penalties, or other monetary
3878obligations collected under this section exclusive of such fees,
3879licenses, and taxes, shall be deposited by the Department of
3880Revenue to the credit of the Title Insurance Regulatory Trust
3881Fund; provided that such excess amount shall not exceed $125,000
3882for 1992, and for any subsequent year shall not exceed $125,000
3883adjusted annually by the lesser of 20 percent or the growth in
3884the total of such excess amount. The remainder of such excess
3885amount shall be deposited into the General Revenue Fund.
3886     637.2042  Administration of taxes; payments.-
3887     (1)  The Department of Revenue shall administer, audit, and
3888enforce the assessment and collection of those taxes to which
3889this section is applicable. The department may share information
3890with the Department of Revenue as necessary to verify premium
3891tax or other tax liability arising under such taxes and credits
3892which may apply thereto.
3893     (2)(a)  Installments of the taxes to which this section is
3894applicable shall be due and payable on April 15, June 15, and
3895October 15 in each year, based upon the estimated gross amount
3896of receipts of insurance premiums or assessments received during
3897the immediately preceding calendar quarter. A final payment of
3898tax due for the year shall be made at the time the taxpayer
3899files her or his return for such year. On or before March 1 in
3900each year, an annual return shall be filed showing, by quarters,
3901the gross amount of receipts taxable for the preceding year and
3902the installment payments made during that year.
3903     (b)  Any taxpayer who fails to report and timely pay any
3904installment of tax, who estimates any installment of tax to be
3905less than 90 percent of the amount finally shown to be due in
3906any quarter, or who fails to report and timely pay any tax due
3907with the final return is in violation of this section and is
3908subject to a penalty of 10 percent on any underpayment of taxes
3909or delinquent taxes due and payable for that quarter or on any
3910delinquent taxes due and payable with the final return. Any
3911taxpayer paying, for each installment required in this section,
391227 percent of the amount of the net tax due as reported on her
3913or his return for the preceding year shall not be subject to the
3914penalty provided by this section for underpayment of estimated
3915taxes.
3916     (c)  When any taxpayer fails to pay any amount due under
3917this section, or any portion thereof, on or before the day when
3918such tax or installment of tax is required by law to be paid,
3919there shall be added to the amount due interest at the rate of
392012 percent per year from the date due until paid.
3921     (d)  All penalties and interest imposed on those taxes to
3922which this section is applicable shall be payable to and
3923collectible by the Department of Revenue in the same manner as
3924if they were a part of the tax imposed.
3925     (e)  The Department of Revenue may settle or compromise any
3926such interest or penalties imposed on those taxes to which this
3927section is applicable pursuant to s. 213.21.
3928     (3)  This section is applicable to taxes imposed by ss.
3929629.5100, 637.2039, and 637.2046.
3930     637.2043  Adjustments.-
3931     (1)  If a taxpayer is required to amend its corporate
3932income tax liability under chapter 220, or the taxpayer receives
3933a refund of its workers' compensation administrative assessment
3934paid under chapter 440, the taxpayer shall file an amended
3935insurance premium tax return not later than 60 days after such
3936an occurrence.
3937     (2)  If an amended insurance premium tax return is required
3938under subsection (1), notwithstanding any other provision of s.
393995.091(3):
3940     (a)  A notice of deficiency may be issued at any time
3941within 3 years after the date the amended insurance premium tax
3942return is given; or
3943     (b)  If a taxpayer fails to file an amended insurance
3944premium tax return, a notice of deficiency may be issued at any
3945time.
3946
3947The amount of any proposed assessment set forth in such a notice
3948of deficiency shall be limited to the amount of any deficiency
3949resulting under this chapter from recomputation of the
3950taxpayer's insurance premium tax and retaliatory tax for the
3951taxable year after giving effect only to the change in corporate
3952income tax paid and the change in the amount of the workers'
3953compensation administrative assessment paid. Interest in
3954accordance with s. 637.2042 is due on the amount of any
3955deficiency from the date fixed for filing the original insurance
3956premium tax return for the taxable year until the date of
3957payment of the deficiency.
3958     (3)  If an amended insurance premium tax return is required
3959by subsection (1), a claim for refund may be filed within 2
3960years after the date on which the amended insurance premium tax
3961return was due, regardless of whether such notice was given,
3962notwithstanding any other provision of s. 215.26. However, the
3963amount recoverable pursuant to such a claim shall be limited to
3964the amount of any overpayment resulting under this chapter from
3965recomputation of the taxpayer's insurance premium tax and
3966retaliatory tax for the taxable year after giving effect only to
3967the change in corporate income tax paid and the change in the
3968amount of the workers' compensation administrative assessment
3969paid.
3970     637.2046  Tax statement; overpayments.-
3971     (1)  Tax returns as to taxes mentioned in s. 637.2039 shall
3972be made by insurers on forms to be prescribed by the Department
3973of Revenue and shall be sworn to by one or more of the executive
3974officers or attorney, if a reciprocal insurer, of the insurer
3975making the returns.
3976     (2)  Notwithstanding the provisions of s. 215.26(1), if any
3977insurer makes an overpayment on account of taxes due under s.
3978637.2039, a refund of the overpayment of taxes shall be made out
3979of the General Revenue Fund. Overpayment of taxes due under s.
3980637.2039 shall be refunded no sooner than the first day of the
3981state fiscal year following the date the tax was due.
3982     (3)(a)  If it appears, upon examination of an insurance
3983premium tax return made under this chapter, that an amount of
3984insurance premium tax has been paid in excess of the amount due,
3985the Department of Revenue may refund the amount of the
3986overpayment to the taxpayer by a warrant of the Chief Financial
3987Officer. The Department of Revenue may refund the overpayment
3988without regard to whether the taxpayer has filed a written claim
3989for a refund; however, the Department of Revenue may request
3990that the taxpayer file a statement affirming that the taxpayer
3991made the overpayment.
3992     (b)  Notwithstanding paragraph (a), a refund of the
3993insurance premium tax may not be made, and a taxpayer is not
3994entitled to bring an action for a refund of the insurance
3995premium tax, after the period specified in s. 215.26(2) has
3996elapsed.
3997     (c)  If a refund issued by the Department of Revenue under
3998this subsection is found to exceed the amount of refund legally
3999due to the taxpayer, the provisions of s. 637.2042 concerning
4000penalties and interest do not apply if the taxpayer reimburses
4001the department for any overpayment within 60 days after the
4002taxpayer is notified that the overpayment was made.
4003     637.2047  Preemption by state.-
4004     (1)  This state hereby preempts the field of imposing
4005excise, privilege, franchise, income, license, permit,
4006registration, and similar taxes and fees, measured by premiums,
4007income, or volume of transactions, upon insurers and their
4008agents and other representatives; and a county, city,
4009municipality, district, school district, or other political
4010subdivision or agency in this state may not impose, levy,
4011charge, or require the same, subject however to the provisions
4012of subsection (2).
4013     (2)  This section shall not be construed to limit or modify
4014the power of any incorporated city or town to levy the taxes
4015authorized by ss. 175.101 and 185.08 or the power of any special
4016fire control district to levy the taxes authorized by s.
4017175.101.
4018     637.2048  Deposit of certain tax receipts; refund of
4019improper payments.-
4020     (1)  The Department of Financial Services shall promptly
4021deposit in the State Treasury to the credit of the Title
4022Insurance Regulatory Trust Fund all "state tax" portions of
4023agents' licenses collected under s. 637.2031. All moneys
4024received by the department not in accordance with the provisions
4025of this chapter or not in the exact amount as specified by the
4026applicable provisions of this chapter shall be returned to the
4027remitter. The records of the department shall show the date and
4028reason for such return.
4029     (2)  The Department of Revenue shall promptly deposit into
4030the Department of Revenue Premium Tax Clearing Trust Fund all
4031premium taxes collected according to s. 637.2039. Such taxes
4032shall be distributed on an estimated basis within 15 days after
4033receipt by the Department of Revenue. Such distribution shall be
4034adjusted pursuant to an audit by the Department of Revenue.
4035     Section 8.  Section 627.778, Florida Statutes, is
4036transferred, renumbered as section 637.20485, Florida Statutes,
4037and subsection (2) of that section is amended to read:
4038     637.20485 627.778  Limit of risk.-
4039     (2)  Surplus as to policyholders shall be determined from
4040the last annual statement of the insurer filed under s. 637.2024
4041624.424.
4042     Section 9.  Sections 637.2049, 637.20495, 637.2051,
4043637.2053, 637.2054, 637.2055, 637.2056, and 637.2057, Florida
4044Statutes, are created to read:
4045     637.2049  Reinsurance.-
4046     (1)  The purpose of this section is to protect the
4047interests of insureds, claimants, ceding insurers, assuming
4048insurers, and the public. It is the intent of the Legislature to
4049ensure adequate regulation of insurers and reinsurers and
4050adequate protection for those to whom they owe obligations. In
4051furtherance of that state interest, the Legislature requires
4052that upon the insolvency of a non-United States insurer or
4053reinsurer which provides security to fund its United States
4054obligations in accordance with this section, such security shall
4055be maintained in the United States and claims shall be filed
4056with and valued by the state insurance regulator with regulatory
4057oversight, and the assets shall be distributed in accordance
4058with the insurance laws of the state in which the trust is
4059domiciled that are applicable to the liquidation of domestic
4060United States insurance companies. The Legislature declares that
4061the matters contained in this section are fundamental to the
4062business of insurance in accordance with 15 U.S.C. ss. 1011-
40631012.
4064     (2)  Credit for reinsurance must be allowed a ceding
4065insurer as either an asset or a deduction from liability on
4066account of reinsurance ceded only when the reinsurer meets the
4067requirements of paragraph (3)(a), paragraph (3)(b), or paragraph
4068(3)(c). Credit must be allowed under paragraph (3)(a) or
4069paragraph (3)(b) only for cessions of those kinds or lines of
4070business that the assuming insurer is licensed, authorized, or
4071otherwise permitted to write or assume in its state of domicile
4072or, in the case of a United States branch of an alien assuming
4073insurer, in the state through which it is entered and licensed
4074or authorized to transact insurance or reinsurance.
4075     (3)(a)  Credit must be allowed when the reinsurance is
4076ceded to an assuming insurer that is authorized to transact
4077insurance or reinsurance in this state.
4078     (b)1.  Credit must be allowed when the reinsurance is ceded
4079to an assuming insurer that is accredited as a reinsurer in this
4080state. An accredited reinsurer is one that:
4081     a.  Files with the department evidence of its submission to
4082this state's jurisdiction.
4083     b.  Submits to this state's authority to examine its books
4084and records.
4085     c.  Is licensed or authorized to transact insurance or
4086reinsurance in at least one state or, in the case of a United
4087States branch of an alien assuming insurer, is entered through,
4088licensed, or authorized to transact insurance or reinsurance in
4089at least one state.
4090     d.  Files annually with the department a copy of its annual
4091statement filed with the insurance department of its state of
4092domicile any quarterly statements if required by its state of
4093domicile or such quarterly statements if specifically requested
4094by the department, and a copy of its most recent audited
4095financial statement.
4096     (I)  Maintains a surplus as regards policyholders in an
4097amount not less than $20 million and whose accreditation has not
4098been denied by the department within 90 days after its
4099submission; or
4100     (II)  Maintains a surplus as regards policyholders in an
4101amount not less than $20 million and whose accreditation has
4102been approved by the department.
4103     2.  The department may deny or revoke an assuming insurer's
4104accreditation if the assuming insurer does not submit the
4105required documentation pursuant to subparagraph 1., if the
4106assuming insurer fails to meet all of the standards required of
4107an accredited reinsurer, or if the assuming insurer's
4108accreditation would be hazardous to the policyholders of this
4109state. In determining whether to deny or revoke accreditation,
4110the department may consider the qualifications of the assuming
4111insurer with respect to all the following subjects:
4112     a.  Its financial stability.
4113     b.  The lawfulness and quality of its investments.
4114     c.  The competency, character, and integrity of its
4115management.
4116     d.  The competency, character, and integrity of persons who
4117own or have a controlling interest in the assuming insurer.
4118     e.  Whether claims under its contracts are promptly and
4119fairly adjusted and are promptly and fairly paid in accordance
4120with the law and the terms of the contracts.
4121     3.  Credit must not be allowed a ceding insurer if the
4122assuming insurer's accreditation has been revoked by the
4123department after notice and the opportunity for a hearing.
4124     4.  The actual costs and expenses incurred by the
4125department to review a reinsurer's request for accreditation and
4126subsequent reviews must be charged to and collected from the
4127requesting reinsurer. If the reinsurer fails to pay the actual
4128costs and expenses promptly when due, the department may refuse
4129to accredit the reinsurer or may revoke the reinsurer's
4130accreditation.
4131     (c)1.  Credit must be allowed when the reinsurance is ceded
4132to an assuming insurer that maintains a trust fund in a
4133qualified United States financial institution, as defined in
4134paragraph (5)(b), for the payment of the valid claims of its
4135United States ceding insurers and their assigns and successors
4136in interest. To enable the department to determine the
4137sufficiency of the trust fund, the assuming insurer shall report
4138annually to the department information substantially the same as
4139that required to be reported on the NAIC Annual Statement form
4140by authorized insurers. The assuming insurer shall submit to
4141examination of its books and records by the department and bear
4142the expense of examination.
4143     2.a.  Credit for reinsurance must not be granted under this
4144subsection unless the form of the trust and any amendments to
4145the trust have been approved by:
4146     (I)  The insurance regulator of the state in which the
4147trust is domiciled; or
4148     (II)  The insurance regulator of another state who,
4149pursuant to the terms of the trust instrument, has accepted
4150principal regulatory oversight of the trust.
4151     b.  The form of the trust and any trust amendments must be
4152filed with the insurance regulator of every state in which the
4153ceding insurer beneficiaries of the trust are domiciled. The
4154trust instrument must provide that contested claims are valid
4155and enforceable upon the final order of any court of competent
4156jurisdiction in the United States. The trust must vest legal
4157title to its assets in its trustees for the benefit of the
4158assuming insurer's United States ceding insurers and their
4159assigns and successors in interest. The trust and the assuming
4160insurer are subject to examination as determined by the
4161insurance regulator.
4162     c.  The trust remains in effect for as long as the assuming
4163insurer has outstanding obligations due under the reinsurance
4164agreements subject to the trust. No later than February 28 of
4165each year, the trustee of the trust shall report to the
4166insurance regulator in writing the balance of the trust and list
4167the trust's investments at the preceding year end, and shall
4168certify that the trust will not expire prior to the following
4169December 31.
4170     3.  The following requirements apply to the following
4171categories of assuming insurer:
4172     a.  The trust fund for a single assuming insurer consists
4173of funds in trust in an amount not less than the assuming
4174insurer's liabilities attributable to reinsurance ceded by
4175United States ceding insurers, and, in addition, the assuming
4176insurer shall maintain a trusteed surplus of not less than $20
4177million. Not less than 50 percent of the funds in the trust
4178covering the assuming insurer's liabilities attributable to
4179reinsurance ceded by United States ceding insurers and trusteed
4180surplus shall consist of assets of a quality substantially
4181similar to that required in part II of chapter 625. Clean,
4182irrevocable, unconditional, and evergreen letters of credit,
4183issued or confirmed by a qualified United States financial
4184institution, as defined in paragraph (5)(a), effective no later
4185than December 31 of the year for which the filing is made and in
4186the possession of the trust on or before the filing date of its
4187annual statement, may be used to fund the remainder of the trust
4188and trusteed surplus.
4189     b.(I)  In the case of a group including incorporated and
4190individual unincorporated underwriters:
4191     (A)  For reinsurance ceded under reinsurance agreements
4192with an inception, amendment, or renewal date on or after August
41931, 1995, the trust consists of a trusteed account in an amount
4194not less than the group's several liabilities attributable to
4195business ceded by United States domiciled ceding insurers to any
4196member of the group.
4197     (B)  For reinsurance ceded under reinsurance agreements
4198with an inception date on or before July 31, 1995, and not
4199amended or renewed after that date, notwithstanding the other
4200provisions of this section, the trust consists of a trusteed
4201account in an amount not less than the group's several insurance
4202and reinsurance liabilities attributable to business written in
4203the United States.
4204     (C)  In addition to these trusts, the group shall maintain
4205in trust a trusteed surplus of which $100 million must be held
4206jointly for the benefit of the United States domiciled ceding
4207insurers of any member of the group for all years of account.
4208     (II)  The incorporated members of the group must not be
4209engaged in any business other than underwriting of a member of
4210the group, and are subject to the same level of regulation and
4211solvency control by the group's domiciliary regulator as the
4212unincorporated members.
4213     (III)  Within 90 days after its financial statements are
4214due to be filed with the group's domiciliary regulator, the
4215group shall provide to the insurance regulator an annual
4216certification by the group's domiciliary regulator of the
4217solvency of each underwriter member or, if a certification is
4218unavailable, financial statements, prepared by independent
4219public accountants, of each underwriter member of the group.
4220     (d)  Credit must be allowed when the reinsurance is ceded
4221to an assuming insurer not meeting the requirements of paragraph
4222(a), paragraph (b), or paragraph (c), but only as to the
4223insurance of risks located in jurisdictions in which the
4224reinsurance is required to be purchased by a particular entity
4225by applicable law or regulation of that jurisdiction.
4226     (e)  If the reinsurance is ceded to an assuming insurer not
4227meeting the requirements of paragraph (a), paragraph (b),
4228paragraph (c), or paragraph (d), the department may allow
4229credit, but only if the assuming insurer holds surplus in excess
4230of $100 million and has a secure financial strength rating from
4231at least two nationally recognized statistical rating
4232organizations deemed acceptable by the department. In
4233determining whether credit should be allowed, the department
4234shall consider the following:
4235     1.  The domiciliary regulatory jurisdiction of the assuming
4236insurer.
4237     2.  The structure and authority of the domiciliary
4238regulator with regard to solvency regulation requirements and
4239the financial surveillance of the reinsurer.
4240     3.  The substance of financial and operating standards for
4241reinsurers in the domiciliary jurisdiction.
4242     4.  The form and substance of financial reports required to
4243be filed by the reinsurers in the domiciliary jurisdiction or
4244other public financial statements filed in accordance with
4245generally accepted accounting principles.
4246     5.  The domiciliary regulator's willingness to cooperate
4247with United States regulators in general and the department in
4248particular.
4249     6.  The history of performance by reinsurers in the
4250domiciliary jurisdiction.
4251     7.  Any documented evidence of substantial problems with
4252the enforcement of valid United States judgments in the
4253domiciliary jurisdiction.
4254     8.  Any other matters deemed relevant by the department.
4255The department shall give appropriate consideration to insurer
4256group ratings that may have been issued. The department may, in
4257lieu of granting full credit under this subsection, reduce the
4258amount required to be held in trust under paragraph (c).
4259     (f)  If the assuming insurer is not authorized or
4260accredited to transact insurance or reinsurance in this state
4261pursuant to paragraph (a) or paragraph (b), the credit permitted
4262by paragraph (c) or paragraph (d) must not be allowed unless the
4263assuming insurer agrees in the reinsurance agreements:
4264     1.a.  That in the event of the failure of the assuming
4265insurer to perform its obligations under the terms of the
4266reinsurance agreement, the assuming insurer, at the request of
4267the ceding insurer, shall submit to the jurisdiction of any
4268court of competent jurisdiction in any state of the United
4269States, will comply with all requirements necessary to give the
4270court jurisdiction, and will abide by the final decision of the
4271court or of any appellate court in the event of an appeal.
4272     b.  To designate the Chief Financial Officer, pursuant to
4273s. 48.151, or a designated attorney as its true and lawful
4274attorney upon whom may be served any lawful process in any
4275action, suit, or proceeding instituted by or on behalf of the
4276ceding company.
4277     2.  This paragraph is not intended to conflict with or
4278override the obligation of the parties to a reinsurance
4279agreement to arbitrate their disputes, if this obligation is
4280created in the agreement.
4281     (g)  If the assuming insurer does not meet the requirements
4282of paragraph (a) or paragraph (b), the credit permitted by
4283paragraph (c) or paragraph (d) is not allowed unless the
4284assuming insurer agrees in the trust agreements, in substance,
4285to the following conditions:
4286     1.  Notwithstanding any other provisions in the trust
4287instrument, if the trust fund is inadequate because it contains
4288an amount less than the amount required by paragraph (c), or if
4289the grantor of the trust has been declared insolvent or placed
4290into receivership, rehabilitation, liquidation, or similar
4291proceedings under the laws of its state or country of domicile,
4292the trustee shall comply with an order of the insurance
4293regulator with regulatory oversight over the trust or with an
4294order of a United States court of competent jurisdiction
4295directing the trustee to transfer to the insurance regulator
4296with regulatory oversight all of the assets of the trust fund.
4297     2.  The assets must be distributed by and claims must be
4298filed with and valued by the insurance regulator with regulatory
4299oversight in accordance with the laws of the state in which the
4300trust is domiciled which are applicable to the liquidation of
4301domestic insurance companies.
4302     3.  If the insurance regulator with regulatory oversight
4303determines that the assets of the trust fund or any part thereof
4304are not necessary to satisfy the claims of the United States
4305ceding insurers of the grantor of the trust, the assets or part
4306thereof must be returned by the insurance regulator with
4307regulatory oversight to the trustee for distribution in
4308accordance with the trust agreement.
4309     4.  The grantor shall waive any right otherwise available
4310to it under United States law which is inconsistent with this
4311provision.
4312     (4)  An asset allowed or a deduction from liability taken
4313for the reinsurance ceded by an insurer to an assuming insurer
4314not meeting the requirements of subsections (2) and (3) is
4315allowed in an amount not exceeding the liabilities carried by
4316the ceding insurer. The deduction must be in the amount of funds
4317held by or on behalf of the ceding insurer, including funds held
4318in trust for the ceding insurer, under a reinsurance contract
4319with the assuming insurer as security for the payment of
4320obligations thereunder, if the security is held in the United
4321States subject to withdrawal solely by, and under the exclusive
4322control of, the ceding insurer, or, in the case of a trust, held
4323in a qualified United States financial institution, as defined
4324in paragraph (5)(b). This security may be in the form of:
4325     (a)  Cash in United States dollars;
4326     (b)  Securities listed by the Securities Valuation Office
4327of the National Association of Insurance Commissioners and
4328qualifying as admitted assets pursuant to part II of chapter
4329625;
4330     (c)  Clean, irrevocable, unconditional letters of credit,
4331issued or confirmed by a qualified United States financial
4332institution, as defined in paragraph (5)(a), effective no later
4333than December 31 of the year for which the filing is made, and
4334in the possession of, or in trust for, the ceding company on or
4335before the filing date of its annual statement; or
4336     (d)  Any other form of security acceptable to the
4337department.
4338     (5)(a)  For purposes of paragraph (4)(c) regarding letters
4339of credit, a "qualified United States financial institution"
4340means an institution that:
4341     1.  Is organized or, in the case of a United States
4342department of a foreign banking organization, is licensed under
4343the laws of the United States or any state thereof;
4344     2.  Is regulated, supervised, and examined by United States
4345or state authorities having regulatory authority over banks and
4346trust companies; and
4347     3.  Has been determined by either the department or the
4348Securities Valuation Office of the National Association of
4349Insurance Commissioners to meet such standards of financial
4350condition and standing as are considered necessary and
4351appropriate to regulate the quality of financial institutions
4352whose letters of credit will be acceptable to the department.
4353     (b)  For purposes of those provisions of this law which
4354specify institutions that are eligible to act as a fiduciary of
4355a trust, a "qualified United States financial institution" means
4356an institution that is a member of the Federal Reserve System or
4357that has been determined by the department to meet the following
4358criteria:
4359     1.  Is organized or, in the case of a United States branch
4360or agency department of a foreign banking organization, is
4361licensed under the laws of the United States or any state
4362thereof and has been granted authority to operate with fiduciary
4363powers; and
4364     2.  Is regulated, supervised, and examined by federal or
4365state authorities having regulatory authority over banks and
4366trust companies.
4367     (6)  After notice and an opportunity for a hearing, the
4368department may disallow any credit that it finds would be
4369contrary to the proper interests of the policyholders or
4370stockholders of a ceding domestic insurer.
4371     (7)  Credit must be allowed to any ceding insurer for
4372reinsurance otherwise complying with this section only when the
4373reinsurance is payable by the assuming insurer on the basis of
4374the liability of the ceding insurer under the contract or
4375contracts reinsured without diminution because of the insolvency
4376of the ceding insurer. Such credit must be allowed to the ceding
4377insurer for reinsurance otherwise complying with this section
4378only when the reinsurance agreement provides that payments by
4379the assuming insurer will be made directly to the ceding insurer
4380or its receiver, except when:
4381     (a)  The reinsurance contract specifically provides payment
4382to the named insured, assignee, or named beneficiary of the
4383policy issued by the ceding insurer in the event of the
4384insolvency of the ceding insurer; or
4385     (b)  The assuming insurer, with the consent of the named
4386insured, has assumed the policy obligations of the ceding
4387insurer as direct obligations of the assuming insurer in
4388substitution for the obligations of the ceding insurer to the
4389named insured.
4390     (8)  No person, other than the ceding insurer, has any
4391rights against the reinsurer which are not specifically set
4392forth in the contract of reinsurance or in a specific written,
4393signed agreement between the reinsurer and the person.
4394     (9)  An authorized insurer may not knowingly accept as
4395assuming reinsurer any risk covering subject of insurance which
4396is resident, located, or to be performed in this state and which
4397is written directly by any insurer not then authorized to
4398transact such insurance in this state, other than as to surplus
4399lines insurance lawfully written under part VIII of chapter 626.
4400     (10)(a)  Any domestic or commercially domiciled insurer
4401ceding directly written risks of loss under this section shall,
4402within 30 days after receipt of a cover note or similar
4403confirmation of coverage, or, without exception, no later than 6
4404months after the effective date of the reinsurance treaty, file
4405with the department one copy of a summary statement containing
4406the following information about each treaty:
4407     1.  The contract period.
4408     2.  The nature of the reinsured's business.
4409     3.  An indication as to whether the treaty is proportional,
4410nonproportional, coinsurance, modified coinsurance, or
4411indemnity, as applicable.
4412     4.  The ceding company's loss retention per risk.
4413     5.  The reinsured limits.
4414     6.  Any special contract restrictions.
4415     7.  A schedule of reinsurers assuming the risks of loss.
4416     8.  An indication as to whether payments to the assuming
4417insurer are based on written premiums or earned premiums.
4418     9.  Identification of any intermediary or broker used in
4419obtaining the reinsurance and the department paid to such
4420intermediary or broker if known.
4421     10.  Ceding commissions and allowances.
4422     (b)  The summary statement must be signed and attested to
4423by either the chief executive officer or the chief financial
4424officer of the reporting insurer. In addition to the summary
4425statement, the department may require the filing of any
4426supporting information relating to the ceding of such risks as
4427it deems necessary. If the summary statement prepared by the
4428ceding insurer discloses that the net effect of a reinsurance
4429treaty or treaties, or series of treaties with one or more
4430affiliated reinsurers entered into for the purpose of avoiding
4431the following threshold amount, at any time results in an
4432increase of more than 25 percent to the insurer's surplus as to
4433policyholders, then the insurer shall certify in writing to the
4434department that the relevant reinsurance treaty or treaties
4435comply with the accounting requirements contained in any rule
4436adopted by the department under subsection (13). If such
4437certificate is filed after the summary statement of such
4438reinsurance treaty or treaties, the insurer shall refile the
4439summary statement with the certificate. In any event, the
4440certificate must state that a copy of the certificate was sent
4441to the reinsurer under the reinsurance treaty.
4442     (c)  This subsection applies to cessions of directly
4443written risk or loss. This subsection does not apply to
4444contracts of facultative reinsurance or to any ceding insurer
4445with surplus as to policyholders that exceeds $100 million as of
4446the immediately preceding December 31. Additionally, any ceding
4447insurer otherwise subject to this section with less than
4448$500,000 in direct premiums written in this state during the
4449preceding calendar year or with less than 1,000 policyholders at
4450the end of the preceding calendar year is exempt from the
4451requirements of this subsection. However, any ceding insurer
4452otherwise subject to this section with more than $250,000 in
4453direct premiums written in this state during the preceding
4454calendar quarter is not exempt from the requirements of this
4455subsection.
4456     (d)  An authorized insurer not otherwise exempt from the
4457provisions of this subsection shall provide the information
4458required by this subsection with underlying and supporting
4459documentation upon written request of the department.
4460     (e)  The department may, upon a showing of good cause,
4461waive the requirements of this subsection.
4462     (11)  If the department finds that a reinsurance agreement
4463creates a substantial risk of insolvency to either insurer
4464entering into the reinsurance agreement, the department may by
4465order require a cancellation of the reinsurance agreement.
4466     (12)  No credit shall be allowed for reinsurance with
4467regard to which the reinsurance agreement does not create a
4468meaningful transfer of risk of loss to the reinsurer.
4469     (13)  The department may adopt rules implementing the
4470provisions of this section. Rules are authorized to protect the
4471interests of insureds, claimants, ceding insurers, assuming
4472insurers, and the public. These rules shall be in substantial
4473compliance with:
4474     (a)  The National Association of Insurance Commissioners
4475model regulations relating to credit for reinsurance.
4476     (b)  The National Association of Insurance Commissioners
4477Accounting Practices and Procedures Manual as of March 2002 and
4478subsequent amendments thereto if the methodology remains
4479substantially consistent.
4480
4481The department may further adopt rules to provide for transition
4482from existing requirements for the approval of reinsurers to the
4483accreditation of reinsurers pursuant to this section.
4484     637.20495  Insurer defined.-As used in ss. 637.2051,
4485637.2053, 637.2054, and 637.2055, the term "insurer" means and
4486includes every person as defined in s. 637.1004(14) and title
4487insurer as defined in s. 637.1004(21) as limited to any domestic
4488or commercially domiciled insurer who is doing business as an
4489insurer or who has transacted insurance in this state and
4490against whom claims arising from that transaction may exist now
4491or in the future.
4492     637.2051  Notice to comply with written requirements of
4493department; noncompliance.-
4494     (1)  If the department determines that the conditions set
4495forth in subsection (2) exist, the department shall issue an
4496order placing the title insurer in administrative supervision,
4497setting forth the reasons giving rise to the determination, and
4498specifying that the department is applying and effectuating the
4499provisions of this chapter. An order issued by the department
4500pursuant to this subsection entitles the insurer to request a
4501proceeding under ss. 120.569 and 120.57, and such a request
4502shall stay the action pending such proceeding.
4503     (2)  A title insurer shall be subject to administrative
4504supervision by the department if upon examination or at any
4505other time the department determines that:
4506     (a)  The insurer is in unsound condition;
4507     (b)  The insurer's methods or practices render the
4508continuance of its business hazardous to the public or to its
4509insureds; or
4510     (c)  The insurer has exceeded its powers granted under its
4511certificate of authority and applicable law.
4512     (3)  Within 15 days after receipt of notice of the
4513department's determination to proceed under this chapter, an
4514insurer shall submit to the department a plan to correct the
4515conditions set forth in the notice. For good cause shown, the
4516department may extend the 15-day time period for submission of
4517the plan. If the department and the insurer agree on a
4518corrective plan, a written agreement shall be entered into to
4519carry out the plan.
4520     (4)  If a title insurer fails to timely submit a plan, the
4521department may specify the requirements of a plan to address the
4522conditions giving rise to imposition of administrative
4523supervision under this chapter. In addition, failure of the
4524insurer to timely submit a plan is a violation of the provisions
4525of this chapter punishable in accordance with s. 637.2017.
4526     (5)  The plan shall address, but shall not be limited to,
4527each of the activities of the insurer's business which are set
4528forth in s. 637.2053.
4529     (6)  Any insurer subject to administrative supervision is
4530expected to avail itself of all reasonably available
4531reinsurance. Reasonably available reinsurance shall include
4532unrealized reinsurance, which is defined as reinsurance
4533recoverable on known losses incurred and due under valid
4534reinsurance contracts that have not been identified in the
4535normal course of business and have not been reported in
4536financial statements filed with the department. Within 90 days
4537after being placed under administrative supervision, the insurer
4538shall certify to the Chief Financial Officer that the insurer
4539has engaged an independent third party to search for unrealized
4540reinsurance, and that the insurer has made all relevant books
4541and records available to the third party. The compensation to
4542the third party may be a percentage of unrealized reinsurance
4543identified and collected.
4544     (7)  If the department and the insurer are unable to agree
4545on the provisions of the plan, the department may require the
4546insurer to take such corrective action as may be reasonably
4547necessary to remove the causes and conditions giving rise to the
4548need for administrative supervision.
4549     (8)  The insurer shall have 60 days, or a longer period of
4550time as designated by the department but not to exceed 120 days,
4551after the date of the written agreement or the receipt of the
4552department's plan within which to comply with the requirements
4553of the department. At the conclusion of the initial period of
4554supervision, the department may extend the supervision in
4555increments of 60 days or longer, not to exceed 120 days, if
4556conditions justifying supervision exist. Each extension of
4557supervision shall provide the insurer with a point of entry
4558pursuant to chapter 120.
4559     (9)  The initiation or pendency of administrative
4560proceedings arising from actions taken under this section shall
4561not preclude the department from initiating judicial proceedings
4562to place an insurer in conservation, rehabilitation, or
4563liquidation or initiating other delinquency proceedings however
4564designated under the laws of this state.
4565     (10)  If it is determined that the conditions giving rise
4566to administrative supervision have been remedied so that the
4567continuance of its business is no longer hazardous to the public
4568or to its insureds, the department shall release the insurer
4569from supervision.
4570     (11)  The department may adopt rules to define standards of
4571hazardous financial condition and corrective action
4572substantially similar to that indicated in the National
4573Association of Insurance Commissioners' 1997 "Model Regulation
4574to Define Standards and Commissioner's Authority for Companies
4575Deemed to be in Hazardous Financial Condition," which are
4576necessary to implement the provisions of this part.
4577     637.2053  Prohibited acts during period of supervision.-The
4578department may provide that the title insurer may not conduct
4579the following activities during the period of supervision,
4580without prior approval by the department:
4581     (1)  Dispose of, convey, or encumber any of its assets or
4582its business in force;
4583     (2)  Withdraw any of its bank accounts;
4584     (3)  Lend any of its funds;
4585     (4)  Invest any of its funds;
4586     (5)  Transfer any of its property;
4587     (6)  Incur any debt, obligation, or liability;
4588     (7)  Merge or consolidate with another company;
4589     (8)  Enter into any new reinsurance contract or treaty;
4590     (9)  Terminate, surrender, forfeit, convert, or lapse any
4591insurance policy, certificate, or contract of insurance, except
4592for nonpayment of premiums due;
4593     (10)  Release, pay, or refund premium deposits, accrued
4594cash or loan values, unearned premiums, or other reserves on any
4595insurance policy or certificate; or
4596     (11)  Make any material change in management.
4597     637.2054  Review.-During the period of supervision, the
4598title insurer may contest an action taken or proposed to be
4599taken by the supervisor, specifying the manner wherein the
4600action complained of would not result in improving the condition
4601of the insurer. Such request shall not stay the action specified
4602pending reconsideration of the action by the department. Denial
4603of the insurer's request upon reconsideration entitles the
4604insurer to request a proceeding under ss. 120.569 and 120.57.
4605     637.2055  Administrative election of proceedings.-If the
4606department determines to act under authority of this chapter,
4607the sequence of its acts and proceedings shall be as set forth
4608herein. However, it is a purpose and substance of this chapter
4609to allow the department administrative discretion in the event
4610of insurer delinquencies and, in furtherance of that purpose,
4611the department may, in respect to insurer delinquencies or
4612suspected delinquencies, proceed and administer under the
4613provisions of this chapter or any other applicable law, or under
4614the provisions of this chapter in conjunction with other
4615applicable law, and it is so provided. Nothing contained in this
4616part or in any other provision of law shall preclude the
4617department from initiating judicial proceedings to place an
4618insurer in conservation, rehabilitation, or liquidation
4619proceedings or other delinquency proceedings however designated
4620under the laws of this state, regardless of whether the
4621department has previously initiated administrative supervision
4622proceedings under this part against the insurer. The entry of an
4623order of seizure, rehabilitation, or liquidation pursuant to
4624chapter 631 shall terminate all proceedings pending pursuant to
4625this part.
4626     637.2056  Other laws; conflicts; meetings between the
4627department and the supervisor.-During the period of
4628administrative supervision, the department may meet with a
4629supervisor appointed under this chapter and with the attorney or
4630other representative of the supervisor and such meetings are
4631exempt from the provisions of s. 286.011.
4632     637.2057  Administrative supervision; expenses.-
4633     (1)  During the period of supervision the department by
4634contract or otherwise may appoint a deputy supervisor to
4635supervise the title insurer.
4636     (2)  Each insurer which is subject to administrative
4637supervision by the department shall pay to the department the
4638expenses of its administrative supervision at the rates adopted
4639by the department. Expenses shall include actual travel
4640expenses, a reasonable living expense allowance, compensation of
4641the deputy supervisor or other person employed or appointed by
4642the department for purposes of the supervision, and necessary
4643attendant administrative costs of the department directly
4644related to the supervision. The travel expense and living
4645expense allowance shall be limited to those expenses necessarily
4646incurred on account of the administrative supervision and shall
4647be paid by the insurer together with compensation upon
4648presentation by the department to the insurer of a detailed
4649account of the charges and expenses after a detailed statement
4650has been filed by the deputy supervisor or other person employed
4651or appointed by the department and approved by the department.
4652     (3)  All moneys collected from insurers for the expenses of
4653administrative supervision shall be deposited into the Title
4654Insurance Regulatory Trust Fund, and the department is
4655authorized to make deposits from time to time into this fund
4656from moneys appropriated for the operation of the department.
4657     (4)  Notwithstanding the provisions of s. 112.061, the
4658department is authorized to pay to the deputy supervisor or
4659person employed or appointed by the department for purposes of
4660the supervision out of such trust fund the actual travel
4661expenses, reasonable living expense allowance, and compensation
4662in accordance with the statement filed with the department by
4663the deputy supervisor or other person, as provided in subsection
4664(2), upon approval by the department.
4665     (5)  The department may in whole or in part defer payment
4666of expenses due from the insurer pursuant to this section upon a
4667showing that payment would adversely impact on the financial
4668condition of the insurer and jeopardize its rehabilitation. The
4669payment shall be made by the insurer when the condition is
4670removed and the payment would no longer jeopardize the insurer's
4671financial condition.
4672     Section 10.  Section 627.777, Florida Statutes, is
4673transferred, renumbered as section 637.2058, Florida Statutes,
4674and amended to read:
4675     637.2058 627.777  Approval of forms.-
4676     (1)  A title insurer may not issue or agree to issue any
4677form of title insurance commitment, title insurance policy,
4678other contract of title insurance, or related form until it is
4679filed with and approved by the department office. The department
4680office may not disapprove a title guarantee or policy form on
4681the ground that it has on it a blank form for an attorney's
4682opinion on the title.
4683     (2)  If a form filed for approval is a form recommended by
4684the American Land Title Association at the time of the filing,
4685the department shall approve or disapprove the form within 180
4686days. If a form filed for approval is a form not recommended by
4687the American Land Title Association at the time of the filing,
4688the department shall approve or disapprove the form within 1
4689year.
4690     (3)  At the time of the approval of any form, the
4691department shall determine if a rate in effect at that time
4692applies or if the coverages require adoption of a rule pursuant
4693to s. 637.2064.
4694     (4)  The department may revoke approval of any form upon
4695180 days' notice.
4696     (5)  An insurer may not achieve any competitive advantage
4697over any other insurer or agent as to forms.
4698     Section 11.  Section 627.7773, Florida Statutes, is
4699transferred, renumbered as section 637.2059, Florida Statutes,
4700and amended to read:
4701     637.2059 627.7773  Accounting and auditing of forms by
4702title insurers.-
4703     (1)  Each title insurer authorized to do business in this
4704state shall, at least once during each calendar year, require of
4705each of its title insurance agents or agencies accountings of
4706all outstanding forms in the agent's or agency's possession of
4707the types that are specified in s. 627.777.
4708     (2)  If the department office has reason to believe that an
4709audit of outstanding forms should be required of any title
4710insurer as to a title insurance agent or agency, the department
4711office may require the title insurer to make a special audit of
4712the forms. The title insurer shall complete the audit not later
4713than 60 days after the request is received from the department
4714office, and shall report the results of the special audit to the
4715department office no later than 90 days after the request is
4716received.
4717     Section 12.  Section 627.7776, Florida Statutes, is
4718transferred, renumbered as section 637.2061, Florida Statutes,
4719and subsection (1) of that section is amended to read:
4720     637.2061 627.7776  Furnishing of supplies; civil
4721liability.-
4722     (1)  A title insurer may not furnish to any person any
4723blank forms, applications, stationery, or other supplies to be
4724used in soliciting, negotiating, or effecting contracts of title
4725insurance on its behalf until that person has received from the
4726insurer a contract to act as a title insurance agent or agency
4727and has been licensed by the department, if required by s.
4728637.3006 626.8417.
4729     Section 13.  Section 627.780, Florida Statutes, is
4730transferred, renumbered as section 637.2063, Florida Statutes,
4731and subsection (1) of that section is amended to read:
4732     637.2063 627.780  Illegal dealings in premium.-
4733     (1)  A person may not knowingly quote, charge, accept,
4734collect, or receive a premium for title insurance other than the
4735premium adopted by the department commission, except as provided
4736in s. 637.1033(7)(b). 626.9541(1)(h)3.b.
4737     Section 14.  Section 627.782, Florida Statutes, is
4738transferred, renumbered as section 637.2064, Florida Statutes,
4739and amended to read:
4740     637.2064 627.782  Adoption of rates.-
4741     (1)  Subject to the rating provisions of this chapter code,
4742the department commission must adopt a rule specifying the
4743premium to be charged in this state by title insurers for the
4744respective types of title insurance contracts and, for policies
4745issued through agents or agencies, the percentage of such
4746premium required to be retained by the title insurer which shall
4747not be less than 30 percent. However, in a transaction subject
4748to the Real Estate Settlement Procedures Act of 1974, 12 U.S.C.
4749ss. 2601 et seq., as amended, no portion of the premium
4750attributable to providing a primary title service shall be paid
4751to or retained by any person who does not actually perform or is
4752not liable for the performance of such service.
4753     (2)  In adopting premium rates, the department commission
4754must give due consideration to the following:
4755     (a)  The title insurers' loss experience and prospective
4756loss experience under closing protection letters and policy
4757liabilities.
4758     (b)  A reasonable margin for underwriting profit and
4759contingencies, including contingent liability under s. 637.2075
4760627.7865, sufficient to allow title insurers, agents, and
4761agencies to earn a rate of return on their capital that will
4762attract and retain adequate capital investment in the title
4763insurance business and maintain an efficient title insurance
4764delivery system.
4765     (c)  Past expenses and prospective expenses for
4766administration and handling of risks.
4767     (d)  Liability for defalcation.
4768     (e)  Other relevant factors.
4769     (3)  Rates may be grouped by classification or schedule and
4770may differ as to class of risk assumed.
4771     (4)  Rates may not be excessive, inadequate, or unfairly
4772discriminatory.
4773     (5)  The premium applies to each $100 of insurance issued
4774to an insured.
4775     (6)  The premium rates apply throughout this state.
4776     (7)  The department commission shall, in accordance with
4777the standards provided in subsection (2), review the premium as
4778needed, but not less frequently than once every 3 years, and
4779shall, based upon the review required by this subsection, revise
4780the premium if the results of the review so warrant.
4781     (8)  The department commission may, by rule, require
4782licensees under this part to annually submit statistical
4783information, including loss and expense data, as the department
4784determines to be necessary to analyze premium rates, retention
4785rates, and the condition of the title insurance industry.
4786     Section 15.  Section 627.783, Florida Statutes, is
4787transferred, renumbered as section 637.2065, Florida Statutes,
4788and amended to read:
4789     637.2065 627.783  Rate deviation.-
4790     (1)  A title insurer may petition the department office for
4791an order authorizing a specific deviation from the adopted
4792premium. The petition shall be in writing and sworn to and shall
4793set forth allegations of fact upon which the petitioner will
4794rely, including the petitioner's reasons for requesting the
4795deviation. Any authorized title insurer, agent, or agency may
4796join in the petition for like authority to deviate or may file a
4797separate petition praying for like authority or opposing the
4798deviation. The department office shall rule on all such
4799petitions simultaneously.
4800     (2)  If, in the judgment of the department office, the
4801requested deviation is not justified, the department office may
4802enter an order denying the petition. An order granting a
4803petition constitutes an amendment to the adopted premium as to
4804the petitioners named in the order, and is subject to s.
4805637.2064 627.782.
4806     Section 16.  Section 627.7831, Florida Statutes, is
4807transferred and renumbered as section 637.2066, Florida
4808Statutes.
4809     Section 17.  Section 627.784, Florida Statutes, is
4810transferred and renumbered as section 637.2067, Florida
4811Statutes.
4812     Section 18.  Section 627.7841, Florida Statutes, is
4813transferred and renumbered as section 637.2068, Florida
4814Statutes.
4815     Section 19.  Section 627.7842, Florida Statutes, is
4816transferred and renumbered as section 637.2069, Florida
4817Statutes.
4818     Section 20.  Section 627.7843, Florida Statutes, is
4819transferred and renumbered as section 637.2071, Florida
4820Statutes.
4821     Section 21.  Section 627.7845, Florida Statutes, is
4822transferred, renumbered as section 637.2072, Florida Statutes,
4823and amended to read:
4824     637.2072 627.7845  Determination of insurability required;
4825preservation of evidence of title search and examination.-
4826     (1)  A title insurer may not issue a title insurance
4827commitment, endorsement, or title insurance policy until the
4828title insurer has caused to be made a determination of
4829insurability based upon the evaluation of a reasonable title
4830search or a search of the records of a Uniform Commercial Code
4831filing department office, as applicable, has examined such other
4832information as may be necessary, and has caused to be made a
4833determination of insurability of title or the existence,
4834attachments, perfection, and priority of a Uniform Commercial
4835Code security interest, including endorsement coverages, in
4836accordance with sound underwriting practices.
4837     (2)  The title insurer shall cause the evidence of the
4838determination of insurability and the reasonable title search or
4839search of the records of a Uniform Commercial Code filing
4840department office to be preserved and retained in its files or
4841in the files of its title insurance agent or agency for a period
4842of not less than 7 years after the title insurance commitment,
4843title insurance policy, or guarantee of title was issued. The
4844title insurer or agent or agency must produce the evidence
4845required to be maintained by this subsection at its departments
4846offices upon the demand of the department office. Instead of
4847retaining the original evidence, the title insurer or the title
4848insurance agent or agency may, in the regular course of
4849business, establish a system under which all or part of the
4850evidence is recorded, copied, or reproduced by any photographic,
4851photostatic, microfilm, microcard, miniature photographic, or
4852other process which accurately reproduces or forms a durable
4853medium for reproducing the original.
4854     (3)  The title insurer or its agent or agency must maintain
4855a record of the actual premium charged for issuance of the
4856policy and any endorsements in its files for a period of not
4857less than 7 years. The title insurer, agent, or agency must
4858produce the record at its department office upon demand of the
4859department office.
4860     (4)  This section does not apply to an insurer assuming no
4861primary liability in a contract of reinsurance or to an insurer
4862acting as a coinsurer if any other coinsuring insurer has
4863complied with this section.
4864     Section 22.  Section 627.785, Florida Statutes, is
4865transferred and renumbered as section 637.2073, Florida
4866Statutes.
4867     Section 23.  Section 627.786, Florida Statutes, is
4868transferred, renumbered as section 637.2074, Florida Statutes,
4869and subsection (3) of that section is amended to read:
4870     637.2074 627.786  Transaction of title insurance and any
4871other kind of insurance prohibited.-
4872     (3)  Subsection (1) does not preclude a title insurer from
4873providing instruments to any prospective insured, in the form
4874and content approved by the department office, under which the
4875title insurer assumes liability for loss due to the fraud of,
4876dishonesty of, misappropriation of funds by, or failure to
4877comply with written closing instructions by, its contract
4878agents, agencies, or approved attorneys in connection with a
4879real property transaction for which the title insurer is to
4880issue a title insurance policy.
4881     Section 24.  Section 627.7865, Florida Statutes, is
4882transferred, renumbered as section 637.2075, Florida Statutes,
4883and amended to read:
4884     637.2075 627.7865  Title insurer assessments.-
4885     (1)  As a condition of doing business in this state, each
4886title insurer shall be liable for an assessment to pay all
4887unpaid title insurance claims and expenses of administering and
4888settling such claims on real property in this state for any
4889title insurer that is ordered into liquidation under chapter 631
4890which is liquidated with unpaid outstanding claims. The office
4891shall assess all title insurers on a pro rata basis determined
4892by their writings in this state for amounts necessary to pay the
4893claims. A title insurer is not required to pay an amount in
4894excess of one-tenth of its surplus as to policyholders.
4895     (2)  The receiver or any title insurer may apply to the
4896court for an order of liquidation if it appears that
4897rehabilitation is not viable.
4898     (3)  The following provisions apply upon issuance of a
4899court order directing liquidation of an insurer:
4900     (a)  The policies issued by the title insurer in
4901liquidation shall remain in force.
4902     (b)  The department shall order an assessment upon a
4903judicially approved request by the receiver on an annual basis
4904in an amount that the receiver deems sufficient, together with
4905other assets of the estate, including available reinsurance, for
4906the payment of known claims, loss adjustment expenses, and the
4907cost of administration of the liquidation expenses.
4908     (c)  Each title insurer doing business in this state shall
4909be assessed pro rata based upon the total title insurance
4910premiums written in this state, excluding premiums on
4911reinsurance, as reported to the department for the most recent
4912calendar year.
4913     (d)  Assessments shall be paid to the receiver within 45
4914days after notice of the assessment or pursuant to an approved
4915quarterly installment plan. Any insurer that elects to pay an
4916assessment on an installment plan shall also pay a financing
4917charge to be determined by the receiver.
4918     (e)  The department shall order an emergency assessment
4919upon a judicially approved request by the receiver. The total of
4920any emergency assessment, when added to any annual assessment in
4921a single calendar year, may not exceed the limitation in
4922paragraph (f).
4923     (f)  A title insurer may not be required to pay an
4924assessment or multiple assessments in any 1 year that exceeds 4
4925percent of its surplus to policyholders as of the end of the
4926previous calendar year or more than 10 percent of its surplus to
4927policyholders during a 60-month period. The 10-percent
4928limitation shall be calculated as the sum of the percentages of
4929surplus to policyholders assessed over such 60-month period. The
4930department may exempt or limit the assessment of a title insurer
4931if such assessment would result in a reduction to surplus as to
4932policyholders below the minimum required to maintain the
4933insurer's certificate of authority in this state.
4934     (g)  Once ordered by the department, assessments and
4935emergency assessments shall be considered assets of the estate
4936and subject to the provisions of s. 631.154.
4937     (4)  The receiver shall enter into one or more contracts
4938with a title insurer licensed in this state for the purposes of
4939serving as the point of contact for policyholders of the
4940insolvent insurer and the administration and settlement of
4941claims. The receiver shall make available information regarding
4942unpaid claims on a quarterly basis. The department shall appoint
4943an oversight committee consisting of representatives from the
4944assessed title insurers to review material claims settlements
4945prior to payment and such other actions as the department shall
4946deem appropriate.
4947     (5)  Unless ordered into liquidation, the title insurer in
4948rehabilitation may not be released from rehabilitation until all
4949assessments have been repaid.
4950     Section 25.  Section 627.791, Florida Statutes, is
4951transferred, renumbered as section 637.2076, Florida Statutes,
4952and amended to read:
4953     637.2076 627.791  Penalties against title insurers for
4954violations by persons or entities not licensed.-A title insurer
4955is subject to the penalties in ss. 637.2017(2) and 637.2021
4956624.418(2) and 624.4211 for any violation of a lawful order or
4957rule of the department office or commission, or for any
4958violation of this chapter code, committed by:
4959     (1)  A person, firm, association, corporation, cooperative,
4960joint-stock company, or other legal entity not licensed under
4961this part when issuing and countersigning commitments or
4962policies of title insurance on behalf of the title insurer.
4963     (2)  An attorney when issuing and countersigning
4964commitments or policies of title insurance on behalf of the
4965title insurer.
4966     Section 26.  Section 627.792, Florida Statutes, is
4967transferred, renumbered as section 637.2077, Florida Statutes,
4968and amended to read:
4969     637.2077 627.792  Liability of title insurers for
4970defalcation by title insurance agents or agencies.-A title
4971insurer is liable for the defalcation, conversion, or
4972misappropriation by a licensed title insurance agent or agency
4973of funds held in trust by the agent or agency pursuant to s.
4974637.3029 626.8473. If the agent or agency is an agent or agency
4975for two or more title insurers, any liability shall be borne by
4976the title insurer upon which a title insurance commitment or
4977policy was issued prior to the illegal act. If no commitment or
4978policy was issued, each title insurer represented by the agent
4979or agency at the time of the illegal act shares in the liability
4980in the same proportion that the premium remitted to it by the
4981agent or agency during the 1-year period before the illegal act
4982bears to the total premium remitted to all title insurers by the
4983agent or agency during the same time period.
4984     Section 27.  Section 627.793, Florida Statutes, is
4985transferred, renumbered as section 637.2078, Florida Statutes,
4986and amended to read:
4987     637.2078 627.793  Rulemaking authority.-The department
4988commission may adopt rules implementing the provisions of this
4989chapter part.
4990     Section 28.  Section 627.796, Florida Statutes, is
4991transferred and renumbered as section 637.2079, Florida
4992Statutes.
4993     Section 29.  Section 627.797, Florida Statutes, is
4994transferred, renumbered as section 637.2081, Florida Statutes,
4995and subsection (1) of that section is amended to read:
4996     637.2081 627.797  Exempt title insurance agent list.-
4997     (1)  Every insurer shall file with the department a list
4998containing the name and address of each appointed agent who is
4999exempt from licensure under s. 637.3006(4) 626.8417(4) and who
5000issues or countersigns binders, commitments, title insurance
5001policies, or guarantees of title.
5002     Section 30.  Section 627.798, Florida Statutes, is
5003transferred, renumbered as section 637.2082, Florida Statutes,
5004and amended to read:
5005     637.2082 627.798  Rulemaking authority.-The department
5006commission shall by rule adopt a form to be used to provide
5007notice to a purchaser-mortgagor that the purchaser-mortgagor is
5008not protected by the title policy of the mortgagee.
5009     Section 31.  Sections 637.2083, 637.2084, 637.2085,
5010637.2086, 637.2087, 637.2088, 637.2089, and 637.2091, Florida
5011Statutes, are created to read:
5012     637.2083  Assets not allowed.-In addition to assets
5013impliedly excluded by the provisions of s. 625.012, the
5014following expressly shall not be allowed as assets in any
5015determination of the financial condition of a title insurer:
5016     (1)  Trade names, patents, agreements not to compete, and
5017other like intangible assets.
5018     (2)  Advances (other than policy loans) to officers and
5019directors, whether secured or not, and advances to employees,
5020agents, and other persons on personal security only.
5021     (3)  Stock of such insurer, owned by it, or any material
5022equity therein or loans secured thereby, or any material
5023proportionate interest in such stock acquired or held through
5024the ownership by such insurer of an interest in another firm,
5025corporation, or business unit.
5026     (4)  Furniture, fixtures, furnishings, safes, vehicles,
5027libraries, stationery, literature, and supplies, other than data
5028processing and accounting systems authorized under s.
5029625.012(11), except in the case of title insurers such materials
5030and plants as the insurer is expressly authorized to invest in
5031under s. 637.20073 and except, in the case of any insurer, such
5032personal property as the insurer is permitted to hold pursuant
5033to part II of this chapter, or which is acquired through
5034foreclosure of chattel mortgages acquired pursuant to s.
5035625.329, or which is reasonably necessary for the maintenance
5036and operation of real estate lawfully acquired and held by the
5037insurer other than real estate used by it for home office,
5038branch office, and similar purposes.
5039     (5)  The amount, if any, by which the aggregate book value
5040of investments as carried in the ledger assets of the insurer
5041exceeds the aggregate value thereof as determined under this
5042code.
5043     (6)  Bonds, notes, or other evidences of indebtedness which
5044are secured by mortgages or deeds of trust which are in default.
5045     (7)  Prepaid and deferred expenses.
5046     637.2084  Power to contract; purchase of title insurance by
5047or for minor.-
5048     (1)  Any person of competent legal capacity may contract
5049for title insurance.
5050     (2)  Any minor of the age of 15 years or more, as
5051determined by the nearest birthday, may, notwithstanding his or
5052her minority, contract for title insurance on his or her own
5053property.
5054     (3)  If any minor mentioned in subsection (2) is possessed
5055of an estate that is being administered by a guardian or
5056curator, such contract shall not be binding upon such estate as
5057to payment of premiums, except as and when consented to by the
5058guardian or curator and approved by the probate court of the
5059county in which the administration of the estate is pending; and
5060such consent and approval shall be required as to each premium
5061payment.
5062     637.2085  Charter, bylaw provisions.-A title insurance
5063policy may not contain any provision purporting to make any
5064portion of the charter, bylaws, or other constituent document of
5065the title insurer a part of the contract unless such portion is
5066set forth in full in the policy. Any policy provision in
5067violation of this section is invalid.
5068     637.2086  Execution of policies.-
5069     (1)  Every title insurance policy shall be executed in the
5070name of and on behalf of the insurer by its officer, attorney in
5071fact, employee, or representative duly authorized by the title
5072insurer.
5073     (2)  A facsimile signature of any such executing individual
5074may be used in lieu of an original signature.
5075     (3)  A title insurance contract that is otherwise valid may
5076not be rendered invalid by reason of the apparent execution
5077thereof on behalf of the title insurer by the imprinted
5078facsimile signature of an individual not authorized so to
5079execute as of the date of the policy.
5080     637.2087  Construction of policies.-
5081     (1)  Every title insurance contract shall be construed
5082according to the entirety of its terms and conditions as set
5083forth in the policy and as amplified, extended, or modified by
5084any application therefor or any rider or endorsement thereto.
5085     (2)  If a title insurer or licensee advertises title
5086insurance policy in a language other than English, the
5087advertisements shall not be construed to modify or change the
5088insurance policy written in English. The advertisement must
5089disclose that the policy written in English controls in the
5090event of a dispute and that statements contained in the
5091advertisement do not necessarily, as a result of possible
5092linguistic differences, reflect the contents of the policy
5093written in English. Nothing in this subsection shall affect the
5094provisions of s. 637.1033 relating to misrepresentations and
5095false advertising of insurance policies.
5096     637.2088  Payment of judgment by title insurer; penalty for
5097failure.-
5098     (1)  Every judgment or decree for the recovery of money
5099entered in any of the courts of this state against any
5100authorized title insurer shall be fully satisfied within 60 days
5101after the entry thereof or, in the case of an appeal from such
5102judgment or decree, within 60 days after the affirmance of the
5103same by the appellate court.
5104     (2)  If the judgment or decree is not satisfied as required
5105under subsection (1), and proof of such failure to satisfy is
5106made by filing with the department a certified transcript of the
5107docket of the judgment or decree together with a certificate by
5108the clerk of the court wherein the judgment or decree was
5109entered that the judgment or decree remains unsatisfied, in
5110whole or in part, after the time aforesaid, the department shall
5111forthwith revoke the title insurer's certificate of authority.
5112The department shall not issue to such insurer any new
5113certificate of authority until the judgment or decree is wholly
5114paid and satisfied and proof thereof filed with the department
5115under the official certificate of the clerk of the court wherein
5116the judgment was recovered, showing that the same is satisfied
5117of record, and until the expenses and fees incurred in the case
5118are also paid by the insurer.
5119     637.2089  Attorney's fee.-
5120     (1)  Upon the rendition of a judgment or decree by any of
5121the courts of this state against a title insurer and in favor of
5122any named or omnibus insured or the named beneficiary under a
5123policy or contract executed by the title insurer, the trial
5124court or, in the event of an appeal in which the insured or
5125beneficiary prevails, the appellate court shall adjudge or
5126decree against the title insurer and in favor of the insured or
5127beneficiary a reasonable sum as fees or compensation for the
5128insured's or beneficiary's attorney prosecuting the suit in
5129which the recovery is had.
5130     (2)  When so awarded, compensation or fees of the attorney
5131shall be included in the judgment or decree rendered in the
5132case.
5133     637.2091  Title insurance business exclusive.-
5134     (1)  A domestic title insurer may not engage directly or
5135indirectly in any business other than the title insurance
5136business and business activities reasonably and necessarily
5137incidental to such title insurance business.
5138     (2)  Notwithstanding subsection (1), a title insurer may
5139engage in business as an escrow agent.
5140     (3)  A business trust whose declaration of trust was filed
5141with the Secretary of State prior to January 1, 1959, and which,
5142at the time of the adoption of the Florida Insurance Code, held
5143a certificate of authority as a title insurer may qualify as an
5144insurer for lawyers' professional liability insurance by
5145complying with the applicable provisions of the code.
5146     Section 32.  Part III of chapter 637, Florida Statutes,
5147consisting of sections 637.3001, 637.3002, 637.3003, 637.30041,
5148637.30042, 637.30043, 637.30044, 637.30045, 637.30046,
5149637.30047, 637.30048, 637.30049, 637.3005, 637.3006, 637.3007,
5150637.3008, 637.3009, 637.30093, 637.30094, 637.30095, 637.30096,
5151637.30097, 637.3011, 637.3012, 637.30125, 637.3013, 637.30133,
5152637.30135, 637.3014, 637.30142, 637.30143, 637.30144, 637.30145,
5153637.30146, 637.30147, 637.3015, 637.3016, 637.3017, 637.3018,
5154637.3019, 637.3021, 637.3022, 637.3023, 637.3024, 637.3025,
5155637.3026, 637.3027, 637.3028, 637.3029, and 637.30295, is
5156created and entitled "TITLE INSURANCE AGENT AND AGENCY LICENSING
5157AND ADMINISTRATION."
5158     Section 33.  Section 626.8412, Florida Statutes, is
5159transferred, renumbered as section 637.3001, Florida Statutes,
5160and amended to read:
5161     637.3001 626.8412  License and appointments required.-
5162     (1)  Except as otherwise provided in this part:
5163     (a)  Title insurance business may be conducted sold only by
5164a title insurer or a licensed title insurance agent employed by
5165a licensed and appointed title insurance agency or employed by a
5166title insurer.
5167     (b)  A title insurance agent may not provide sell a title
5168insurance policy for issued by an insurer for which the agent
5169and agency does not hold a current appointment.
5170     (2)  Except as otherwise provided in this part, a person,
5171other than a title insurance agency or an employee of a title
5172insurance agency, may not perform any of the functions of a
5173title insurance agency without a title insurance agency license.
5174     (3)  Each title insurance agency shall annually remit the
5175administrative surcharge required in s. 637.2031(14)(e) prior to
5176January 30 of each year.
5177     (a)  Noncompliance with the payment of the fees as required
5178in s. 637.2031(14)(e) shall result in the immediate suspension
5179of the title insurance agency's appointments to represent an
5180insurer.
5181     (b)  Absent other cause for suspension, the appointments of
5182a title insurance agency may be reinstated upon receipt of the
5183amount due for the administrative surcharge plus any penalties
5184imposed.
5185     (c)  A penalty may be imposed to reinstate the appointments
5186of an agency.
5187     Section 34.  Section 626.8413, Florida Statutes, is
5188transferred, renumbered as section 637.3002, Florida Statutes,
5189and amended to read:
5190     637.3002 626.8413  Title insurance agents; certain names
5191prohibited.-After October 1, 1985, A title insurance agent as
5192defined in s. 626.841 shall not adopt a name which contains the
5193words "title insurance," "title guaranty," or "title guarantee,"
5194unless such words are followed by the word "agent" or "agency"
5195in the same size and type as the words preceding them. This
5196section does not apply to a title insurer acting as an agent for
5197another title insurer.
5198     Section 35.  Sections 637.3003, 637.30041, 637.30042,
5199637.30043, 637.30044, 637.30045, 637.30046, 637.30047,
5200637.30048, and 637.30049, Florida Statutes, are created to read:
5201     637.3003  Firm, corporate, and business names; officers;
5202associates; notice of changes.-
5203     (1)  Any licensed title agent doing business under a firm
5204or corporate name or under any business name other than his or
5205her own individual name shall, within 30 days after the initial
5206transaction of insurance under such business name, file with the
5207department, on forms adopted and furnished by the department, a
5208written statement of the firm, corporate, or business name being
5209used, the address of any office or offices or places of business
5210making use of such name, and the name and social security number
5211of each officer and director of the corporation and of each
5212individual associated in such firm or corporation as to the
5213insurance transactions of such firm or corporation or in the
5214use of such business name.
5215     (2)  In the event of any change of such name, a change of
5216any of the officers or directors, a change of any of such
5217addresses, or a change in the personnel associated with such
5218firm or corporation, written notice of such change shall be
5219filed with the department within 30 days by or on behalf of
5220those licensees terminating any such firm, corporation, or
5221business name or continuing to operate under such name.
5222     (3)  Within 30 days after a change, any licensed title
5223insurance agency shall notify the department of any change in
5224the information contained in the application filed pursuant to s.
5225637.3007.
5226     637.30041  Insurance agency names; disapproval.-The
5227department may disapprove the use of any true or fictitious
5228name, other than the bona fide natural name of an individual, by
5229any title insurance agency on any of the following grounds:
5230     (1)  The name interferes with or is too similar to a
5231name already filed and in use by another title insurance agency
5232or title insurer.
5233     (2)  The use of the name may mislead the public in any
5234respect.
5235     (3)  The name states or implies that the title insurance
5236agency is an insurer, motor club, hospital service plan, state
5237or federal agency, charitable organization, or entity that
5238primarily provides advice and counsel rather than sells or
5239solicits title insurance, or is entitled to engage in title
5240insurance activities not permitted under licenses held or
5241applied for. This subsection does not prohibit the use of the
5242word "state" or "states" in the name of the agency. The use of
5243the word "state" or "states" in the name of an agency does not
5244imply that the agency is a state agency.
5245     637.30042  Examination requirement; exemptions.-The
5246department may not issue any license as a title insurance agent
5247to any individual who has not qualified for, taken, and
5248passed to the satisfaction of the department a written
5249examination of the scope prescribed in s. 637.30044.
5250     637.30043  Eligibility; application for examination.-
5251     (1)  A person may not be permitted to take an
5252examination for license until his or her application for
5253examination or application for the license has been approved
5254and the required fees have been received by the department
5255or a person designated by the department to administer the
5256examination.
5257     (2)  A person required to take an examination for a license
5258may be permitted to take an examination prior to submitting an
5259application for licensure pursuant to s. 637.3006 by submitting
5260an application for examination through the department's
5261Internet website. In the application, the applicant shall set
5262forth:
5263     (a)  His or her full name, age, social security number,
5264residence address, business address, and mailing address.
5265     (b)  The type of license that the applicant intends to
5266apply for.
5267     (c)  The name of any required pre-licensing course he or
5268she has completed or is in the process of completing.
5269     (d)  The method by which the applicant intends to qualify
5270for the type of license if other than by completing a pre-
5271licensing course.
5272     (e)  The applicant's gender.
5273     (f)  The applicant's native language.
5274     (g)  The highest level of education achieved by the
5275applicant.
5276     (h)  The applicant's race or ethnicity. However, the
5277application must contain a statement that an applicant is not
5278required to disclose his or her race or ethnicity, gender, or
5279native language, that he or she will not be penalized for not
5280making such disclosure, and that the department will use this
5281information exclusively for research and statistical purposes
5282and to improve the quality and fairness of the examinations.
5283     (3)  Each application shall be accompanied by payment of
5284the applicable examination fee.
5285     637.30044  Scope of examination.-
5286     (1)  Each examination for a license as a title insurance
5287agent, shall be of such scope as is deemed by the department to
5288be reasonably necessary to test the applicant's ability and
5289competence and knowledge of title insurance and real property
5290transactions of the duties and responsibilities of such a
5291licensee, and of the pertinent provisions of the laws of this
5292state.
5293     (2)  Examinations must cover title insurance, abstracting,
5294title searches, examination of title, closing procedures, and
5295escrow handling.
5296     (3)  This section applies to any person who submits an
5297application for license and to any person who submits an
5298application for examination prior to filing an application
5299for license.
5300     637.30045  Time and place of examination; notice.-
5301     (1)  The department or a person designated by the
5302department shall mail written notice of the time and place of
5303the examination to each applicant for examination and each
5304applicant for license required to take an examination who is
5305eligible to take the examination as of the examination date. The
5306notice shall be mailed, postage prepaid, and addressed to the
5307applicant at his or her address shown on the application for
5308license or at such other address as requested by the applicant
5309in writing filed with the department prior to the mailing of the
5310notice. Notice shall be deemed given when mailed.
5311     (2)  The examination shall be held in an adequate and
5312designated examination center in this state.
5313     (3)  The department shall make an examination available to
5314the applicant, to be taken as soon as reasonably possible after
5315the applicant is eligible to take the examination. Any
5316examination required under this part shall be available in this
5317state at a designated examination center.
5318     637.30046  Conduct of examination.-
5319     (1)  The applicant for license or the applicant for
5320examination shall appear in person and personally take the
5321examination for license at the time and place specified by
5322the department or by a person designated by the department.
5323     (2)  The examination shall be conducted by an employee of
5324the department or a person designated by the department for that
5325purpose.
5326     (3)  The questions propounded shall be as prepared by the
5327department, or by a person designated by the department for that
5328purpose, consistent with the applicable provisions of this code.
5329     (4)  All examinations shall be given and graded in a
5330fair and impartial manner and without unfair discrimination in
5331favor of or against any particular applicant.
5332     637.30047  Printing of examinations or related materials to
5333preserve examination security.-A contract let for the
5334development, administration, or grading of examinations or
5335related materials by the department pursuant to the agent,
5336customer representative, or adjuster licensing and examination
5337provisions of this code may include the printing or furnishing
5338of such examinations or related materials in order to preserve
5339security. Any such contract shall be let as a contract for a
5340contractual service pursuant to s. 287.057.
5341     637.30048  Examination fee; determination, refund.-
5342     (1)  Prior to being permitted to take an examination, each
5343applicant who is subject to examination shall pay an examination
5344fee to the department or a person designated by the department.
5345A separate and additional examination fee shall be payable for
5346each separate class of license applied for, notwithstanding that
5347all such examinations are taken on the same date and at the same
5348place.
5349     (2)  The fee for examination is not refundable.
5350     637.30049  Reexamination.-
5351     (1)  Any applicant for license or applicant for examination
5352who has taken an examination and failed to make a passing grade,
5353or failed to appear for the examination or to take or complete
5354the examination at the time and place specified in the
5355notice of the department, may take additional examinations
5356after filing with the department an application for
5357reexamination together with applicable fees. The failure of an
5358applicant to pass an examination or the failure to appear for
5359the examination or to take or complete the examination does not
5360preclude the applicant from taking subsequent examinations.
5361     (2)  The department may require any individual whose
5362license as an agent has expired or has been suspended to pass
5363an examination prior to reinstating or relicensing the
5364individual as to any class of license. The examination fee
5365shall be paid as to each examination.
5366     Section 36.  Section 626.8414, Florida Statutes, is
5367transferred and renumbered as section 637.3005, Florida
5368Statutes.
5369     Section 37.  Section 626.8417, Florida Statutes, is
5370transferred, renumbered as section 637.3006, Florida Statutes,
5371and amended to read:
5372     637.3006 626.8417  Title insurance agent licensure;
5373exemptions.-
5374     (1)  A person may not act as or hold himself or herself out
5375to be a title insurance agent as defined in s. 626.841 until a
5376valid title insurance agent's license has been issued to that
5377person by the department.
5378     (2)  An application for license as a title insurance agent
5379shall be filed with the department on printed forms furnished by
5380the department.
5381     (3)  The department shall not grant or issue a license as
5382title agent to any individual found by it to be untrustworthy or
5383incompetent, who does not meet the qualifications for
5384examination specified in s. 637.3005 626.8414, or who does not
5385meet the following qualifications:
5386     (a)  Within the 4 years immediately preceding the date of
5387the application for license, the applicant must have completed a
538840-hour classroom course in title insurance, 3 hours of which
5389shall be on the subject matter of ethics, as approved by the
5390department, or must have had at least 12 months of experience in
5391responsible title insurance duties, while working in the title
5392insurance business as a substantially full-time, bona fide
5393employee of a title agency, title agent, title insurer, or
5394attorney who conducts real estate closing transactions and
5395issues title insurance policies but who is exempt from licensure
5396pursuant to paragraph (4)(a). If an applicant's qualifications
5397are based upon the periods of employment at responsible title
5398insurance duties, the applicant must submit, with the
5399application for license on a form prescribed by the department,
5400the affidavit of the applicant and of the employer setting forth
5401the period of such employment, that the employment was
5402substantially full time, and giving a brief abstract of the
5403nature of the duties performed by the applicant.
5404     (b)  The applicant must have passed an any examination for
5405licensure required under s. 626.221.
5406     (4)(a)  Title insurers or attorneys duly admitted to
5407practice law in this state and in good standing with The Florida
5408Bar, or law firms employing such attorneys, are exempt from the
5409provisions of this chapter with regard to title insurance
5410licensing and appointment requirements.
5411     (b)  An insurer may designate a corporate officer of the
5412insurer to occasionally issue and countersign binders,
5413commitments, title insurance policies, or guarantees of title. A
5414designated officer is exempt from the provisions of this chapter
5415with regard to title insurance licensing and appointment
5416requirements while the officer is acting within the scope of the
5417designation.
5418     (c)  If an attorney or attorneys own a corporation or other
5419legal entity which is doing business as a title insurance agency
5420other than an entity engaged in the active practice of law, the
5421agency must be licensed and appointed as a title insurance
5422agency with an agent in charge or an attorney designated for the
5423agency agent.
5424     Section 38.  Section 626.8418, Florida Statutes, is
5425transferred, renumbered as section 637.3007, Florida Statutes,
5426and subsection (1) of that section is amended to read:
5427     637.3007 626.8418  Application for title insurance agency
5428license.-Prior to doing business in this state as a title
5429insurance agency, a title insurance agency must meet all of the
5430following requirements:
5431     (1)  The applicant must file with the department an
5432application for a license as a title insurance agency, on
5433printed forms furnished by the department, that includes all of
5434the following:
5435     (a)  The name of each majority owner, partner, officer, and
5436director of the agency.
5437     (b)  The residence address of each person required to be
5438listed under paragraph (a).
5439     (c)  The name of the agency and its principal business
5440address.
5441     (d)  The location of each title insurance agency office and
5442the name under which each title insurance agency office conducts
5443or will conduct business.
5444     (e)  The name of each title insurance agent to be in full-
5445time charge of a title insurance an agency office and
5446specification of which title insurance agency office.
5447     (f)  Such additional information as the department requires
5448by rule to ascertain the trustworthiness and competence of
5449persons required to be listed on the application and to
5450ascertain that such persons meet the requirements of this
5451chapter code.
5452     Section 39.  Section 626.8419, Florida Statutes, is
5453transferred and renumbered as section 637.3008, Florida
5454Statutes.
5455     Section 40.  Section 626.842, Florida Statutes, is
5456transferred and renumbered as section 637.3009, Florida
5457Statutes.
5458     Section 41.  Sections 637.30093, 637.30094, 637.30095,
5459637.30096, and 637.30097, Florida Statutes, are created to read:
5460     637.30093  Continuing education required; application;
5461exceptions; requirements; penalties.-
5462     (1)  The purpose of this section is to establish
5463requirements and standards for continuing education courses for
5464persons licensed to solicit or sell title insurance in this
5465state.
5466     (2)(a)  Each person subject to the provisions of this
5467section must complete a minimum of 10 hours of continuing
5468education courses every 2 years in title insurance courses
5469approved by this state. Each person subject to the provisions
5470of this section must complete, as part of his or her required
5471number of continuing education hours, 2 hours of continuing
5472education, approved by the department, every 2 years on the
5473subject matter of ethics, rules, or state and federal regulatory
5474compliance matters relating to title insurance and closing
5475services.
5476     (b)  Any person who holds a license as a title agent must
5477complete 10 hours of continuing education courses every 2 years.
5478     (c)  Except as provided in paragraph (d), compliance with
5479continuing education requirements is a condition precedent to
5480the issuance, continuation, reinstatement, or renewal of any
5481appointment subject to this chapter.
5482     (d)  A person teaching any approved course of instruction
5483or lecturing at any approved seminar and attending the entire
5484course or seminar shall qualify for the same number of classroom
5485hours as would be granted to a person taking and successfully
5486completing such course, seminar, or program. Credit shall be
5487limited to the number of hours actually taught unless a person
5488attends the entire course or seminar. Any person who is an
5489official of or employed by any governmental entity in this
5490state and serves as a professor, instructor, or in any other
5491position or office the duties and responsibilities of which are
5492determined by the department to require monitoring and review of
5493insurance laws or insurance regulations and practices shall be
5494exempt from this section.
5495     (e)  Excess classroom hours accumulated during any
5496compliance period may be carried forward to the next compliance
5497period.
5498     (f)  For good cause shown, the department may grant an
5499extension of time during which the requirements imposed by this
5500section may be completed, but such extension of time may not
5501exceed 1 year.
5502     (3)  The following courses may be completed in order to
5503meet the continuing education course requirements:
5504     (a)  In the case of title agents, completion of the
5505Certified Land Closer (CLC) professional designation program
5506and receipt of the designation: 24 hours.
5507     (b)  In the case of title agents, completion of the
5508Certified Land Searcher (CLS) professional designation program
5509and receipt of the designation: 24 hours.
5510     (c)  Any insurance-related course which is approved by the
5511department and taught by an accredited college or university per
5512credit hour granted: 12 hours.
5513     (d)  Any course, including courses relating to agency
5514management or errors and omissions, developed or sponsored by
5515any authorized insurer or recognized agents' association or
5516insurance trade association or any independent study
5517program of instruction, subject to approval by the department,
5518qualifies for the equivalency of the number of classroom hours
5519assigned to such course by the department. However, unless
5520otherwise provided in this section, continuing education
5521course hours may not be credited toward meeting the
5522requirements of this section unless the course is provided
5523by classroom instruction or results in a monitored examination.
5524     (e)  A monitored examination is not required for:
5525     1.  An independent study program of instruction presented
5526through interactive, online technology that the department
5527determines has sufficient internal testing to validate the
5528student's full comprehension of the materials presented; or
5529     2.  An independent study program of instruction presented on
5530paper or in printed material that imposes a final closed book
5531examination that meets the requirements of the department's rule
5532for self-study courses. The examination may be taken without a
5533proctor provided the student presents to the provider a sworn
5534affidavit certifying that the student did not consult any
5535written materials or receive outside assistance of any kind or
5536from any person, directly or indirectly, while taking the
5537examination. If the student is an employee of an agency or
5538corporate entity, the student's supervisor or a manager or
5539owner of the agency or corporate entity must also sign the sworn
5540affidavit. If the student is self-employed, a sole proprietor,
5541or a partner, or if the examination is administered online, the
5542sworn affidavit must also be signed by a disinterested third
5543party. The sworn affidavit must be received by the approved
5544provider prior to reporting continuing education credits to
5545the department.
5546     (f)  Each person or entity sponsoring a course for
5547continuing education credit shall furnish, within 30 days
5548after completion of the course, in a form satisfactory to the
5549department or its designee, a written and certified roster
5550showing the name and license number of all persons
5551successfully completing such course and requesting credit,
5552accompanied by the required fee.
5553     (4)  The department shall refuse to renew the appointment
5554of any agent who has not had his or her continuing education
5555requirements certified unless the agent has been granted an
5556extension by the department. The department may not issue a new
5557appointment of the same or similar type, with any insurer, to an
5558agent who was denied a renewal appointment for failure to
5559complete continuing education as required until the agent
5560completes his or her continuing education requirement.
5561     (5)  An 11-member continuing education advisory board is
5562created, to be appointed by the Chief Financial Officer.
5563Appointments shall be for terms of 4 years. The purpose of the
5564board is to advise the department in determining standards by
5565which courses may be evaluated and categorized as basic,
5566intermediate, or advanced. The board shall submit to the
5567department recommendations of changes needed in such criteria
5568not less frequently than every 2 years. The department shall
5569require all approved course providers to submit courses for
5570approval to the department using the criteria. All materials,
5571brochures, and advertisements related to the approved courses
5572must specify the level assigned to the course.
5573     (6)  The department may contract services relative to the
5574administration of the continuing education program to a private
5575entity. The contract shall be procured as a contract for a
5576contractual service pursuant to s. 287.057.
5577     637.30094  Regulation of continuing education for
5578licensees, course providers, instructors, school officials, and
5579monitor groups.-
5580     (1)  Continuing education course providers, instructors,
5581school officials, and monitor groups must be approved by the
5582department before offering continuing education courses pursuant
5583to s. 637.30093.
5584     (2)  The department shall adopt rules establishing
5585standards for the approval, regulation, and operation of the
5586continuing education programs and for the discipline of
5587licensees, course providers, instructors, school officials, and
5588monitor groups. The standards must be designed to ensure that
5589such course providers, instructors, school officials, and
5590monitor groups have the knowledge, competence, and integrity to
5591fulfill the educational objectives of s. 637.30093.
5592     (3)  The department shall adopt rules establishing a
5593process by which compliance with the continuing education
5594requirements of s. 637.30093 can be determined, the
5595establishment of a continuing education compliance period for
5596licensees, and forms necessary to implement such a process.
5597     637.30095  Regulation of course providers, instructors,
5598school officials, and monitor groups involved in prelicensure
5599education for insurance agents and other licensees.-
5600     (1)  Any course provider, instructor, school official, or
5601monitor group must be approved by and registered with the
5602department before offering prelicensure education courses for
5603insurance agents and other licensees.
5604     (2)  The department shall adopt rules establishing standards
5605for the approval, registration, discipline, or removal from
5606registration of course providers, instructors, school officials,
5607and monitor groups. The standards must be designed to ensure
5608that such persons have the knowledge, competence, and integrity
5609to fulfill the educational objectives of the prelicensure
5610requirements of this chapter and chapter 648 and to ensure that
5611insurance agents and licensees are competent to engage in the
5612activities authorized under the license.
5613     (3)  The department shall adopt rules to establish a
5614process for determining compliance with the prelicensure
5615requirements of this chapter and chapter 648. The department
5616shall adopt rules prescribing the forms necessary to administer
5617the prelicensure requirements.
5618     637.30096  Examination results; denial, issuance of
5619license.-
5620     (1)  Within 30 days after the applicant has completed any
5621examination required under s. 637.30042, the department or its
5622designee shall provide a score report and, if the applicant has
5623received a passing grade, the department shall within such
5624period notify the applicant and issue and transmit the license
5625to which such examination related. If the applicant did not make
5626a passing grade on the examination for a particular license, the
5627department or its designee shall within such period provide
5628notice to the applicant to that effect and of the denial of the
5629license. For an applicant who has completed the examination and
5630received a passing grade prior to submitting the license
5631application, the department shall promptly issue the license
5632applied for as soon as the department approves the application.
5633     (2)  A passing grade on an examination is valid for a
5634period of 1 year. The department may not issue a license to an
5635applicant based upon an examination taken more than 1 year prior
5636to the date an application for a license is filed.
5637     637.30097  Form and contents of licenses in general.-Each
5638license issued by the department shall be in such form as the
5639department may designate and must contain the licensee's name,
5640the licensee's personal identification number, the date of
5641issuance, and any other information the department deems
5642necessary to fully identify the licensee and the authority being
5643granted. The department may by rule require photographs of
5644applicants as a part of the licensing process.
5645     Section 42.  Section 626.84201, Florida Statutes, is
5646transferred, renumbered as section 637.3011, Florida Statutes,
5647and amended to read:
5648     637.3011 626.84201  Nonresident title insurance agents.-
5649Notwithstanding s. 637.3005(2) 626.8414(2), the department, upon
5650application and payment of the fees specified in s. 637.2031
5651624.501, may issue a license as a nonresident title insurance
5652agent to an individual not a resident of this state in the same
5653manner applicable to the licensure of nonresident general lines
5654agents under the provisions of s. 626.741, provided the
5655individual passes the examination for licensure required under
5656s. 637.30042 626.221. Nonresident title insurance agents
5657licensed pursuant to this section must complete the continuing
5658education requirements of s. 637.30093 626.2815 in the same
5659manner as resident title insurance agents. Sections 626.742 and
5660626.743 apply to nonresident title insurance agents.
5661     Section 43.  Section 626.8421, Florida Statutes, is
5662transferred, renumbered as section 637.3012, Florida Statutes,
5663and amended to read:
5664     637.3012 626.8421  Number of appointments permitted or
5665required.-A title agent shall be required to have a separate
5666appointment as to each insurer by which he or she is appointed
5667as agent. As a part of each appointment there shall be a
5668certified statement or affidavit of an appropriate officer or
5669official of the appointing insurer stating that to the best of
5670the insurer's knowledge and belief the applicant, or its
5671principals in the case of a corporation or other legal entity,
5672has met the requirements of s. 626.8417.
5673     Section 44.  Section 637.30125, Florida Statutes, is
5674created to read:
5675     637.30125  Agent in charge.-
5676     (1)  Each location of a title insurance agency or insurer
5677at which disbursement of escrow funds or policy issuance
5678services are performed shall have a separate agent in charge.
5679The failure to designate an agent in charge on a form
5680prescribed by the department, within 10 working days after an
5681agency's inception or a change of the agent in charge, is a
5682violation of this chapter, punishable as provided in s.
5683637.3018.
5684     (2)  The agent in charge shall accept and be responsible
5685for the operation and management of a title agency location.
5686     (3)  The agent in charge shall perform his or her duties as
5687set forth in subsection (2) at the location for which he or she
5688is an attorney or agent in charge.
5689     (4)  The department may suspend or revoke the license of
5690the agency if a title insurance agency employs, contracts with,
5691or uses the services of a person who has had a license denied or
5692whose license is currently suspended or revoked. However, a
5693person who has been denied a license for failure to pass a
5694required examination may be employed to perform clerical or
5695administrative functions for which licensure is not required.
5696     (5)  An agency shall designate an attorney licensed by The
5697Florida Bar or an agent licensed by the department as agent in
5698charge for each location of the agency. In the case of multiple
5699locations, the agency shall designate a separate agent in charge
5700for each location.
5701     (6)  The department may adopt rules pursuant to ss.
5702120.536(1) and 120.54 to implement this section and interpret
5703the duties and responsibilities of the agent in charge or the
5704attorney in charge of a licensed title insurance agency.
5705     Section 45.  Section 626.8423, Florida Statutes, is
5706transferred and renumbered as section 637.3013, Florida
5707Statutes.
5708     Section 46.  Section 637.30133, Florida Statutes, is
5709created to read:
5710     637.30133  Consumer protections.-To transact title
5711insurance, title insurance agents shall comply with consumer
5712protection laws, including the following, as applicable:
5713     (1)  Continuing education requirements for resident and
5714nonresident agents, as required in s. 637.30093.
5715     (2)  Fingerprinting requirements for resident and
5716nonresident agents, as required under s. 626.171 or s.
5717637.30135.
5718     (3)  Fingerprinting following a department investigation
5719under s. 637.1019.
5720     (4)  The submission of credit and character reports, as
5721required by s. 626.171 or s. 626.521.
5722     (5)  Qualifications for licensure as an agent in s.
5723626.731, s. 626.741, s. 626.785, s. 626.831, s. 626.835, or s.
57246378.2077.
5725     (6)  Examination requirements in s. 626.741, s. 626.835,
5726637.2077, or s. 637.30042.
5727     (7)  Required licensure or registration of insurance
5728agencies under s. 626.112.
5729     (8)  Requirements for licensure of resident and
5730nonresident agents in s. 626.112, s. 626.321, s. 626.731, s.
5731626.741, s. 626.785, s. 626.831, s. 626.835, s. 626.927, or s.
5732637.2077.
5733     (9)  Any other licensing requirement, restriction, or
5734prohibition designated a consumer protection by the Chief
5735Financial Officer, but not inconsistent with the requirements of
5736Subtitle C of the Gramm-Leach-Bliley Act, 15 U.S.C.A. ss. 6751
5737et seq.
5738     Section 47.  Section 637.30135, Florida Statutes, is
5739created to read:
5740     637.30135  Fingerprinting requirements.-If there is a
5741change in ownership or control of any entity licensed under this
5742chapter, or if a new partner, officer, or director is employed
5743or appointed, a set of fingerprints of the new owner, partner,
5744officer, or director must be filed with the department or office
5745within 30 days after the change. The acquisition of 10 percent
5746or more of the voting securities of a licensed entity is
5747considered a change of ownership or control. The fingerprints
5748must be taken by a law enforcement agency or other
5749department-approved entity and be accompanied by the
5750fingerprint processing fee in s. 637.2031.
5751     Section 48.  Section 626.8427, Florida Statutes, is
5752transferred and renumbered as section 637.3014, Florida
5753Statutes.
5754     Section 49.  Sections 637.30142, 637.30143, 637.30144,
5755637.30145, 637.30146, and 637.30147, Florida Statutes, are
5756created to read:
5757     637.30142  Payment of fees, taxes for appointment period
5758without appointment.-
5759     (1)  All initial appointments shall be submitted to the
5760department on a monthly basis no later than 45 days after the
5761date of appointment and shall become effective on the date
5762requested on the appointment form.
5763     (2)  Upon application and qualification for an initial or
5764renewal appointment and such investigation as the department may
5765make, if it appears to the department that an individual who was
5766formerly licensed or is currently licensed but not properly
5767appointed to represent an insurer or employer and who has
5768been actively engaged or is currently actively engaged as such
5769an appointee, but without being appointed as required, the
5770department, if it finds that such failure to be appointed was an
5771inadvertent error on the part of the insurer or employer so
5772represented, may issue or authorize the issuance of the
5773appointment as applied for but subject to the condition that,
5774before the appointment is issued, all fees and taxes which
5775would have been due had the applicant been so appointed during
5776such current and prior periods, with applicable fees pursuant to
5777s. 637.2031 for such current and prior periods of appointment,
5778shall be paid to the department.
5779     (3)(a)  Failure to notify the department within the
5780required time period shall result in the appointing entity being
5781assessed a delinquent fee of $250 per appointee. Delinquent fees
5782shall be paid by the appointing entity and may not be charged to
5783the appointee.
5784     (b)  Failure to timely renew an appointment by an
5785appointing entity prior to the expiration date of the
5786appointment shall result in the appointing entity being assessed
5787late filing, continuation, and reinstatement fees as prescribed
5788in s. 637.2031. Such fees shall be paid by the appointing entity
5789and may not be charged back to the appointee.
5790     637.30143  License or appointment; transferability.-A
5791license or appointment issued under this part is valid only as
5792to the person named and is not transferable to any other
5793person. A licensee or appointee may not allow any other
5794person to transact insurance by using the license or
5795appointment issued to such licensee or appointee.
5796     637.30144  Termination of appointment.-
5797     (1)  Subject to an appointee's contract rights, an
5798appointing entity may terminate its appointment of any appointee
5799at any time. Except when termination is upon a ground which
5800would subject the appointee to suspension or revocation of his
5801or her license and appointment under s. 637.3017 or s. 637.3018,
5802and except as provided by contract between the appointing entity
5803and the appointee, the appointing entity shall give to the
5804appointee at least 60 days' advance written notice of its
5805intention to terminate such appointment by delivery of such
5806notice to the appointee in person or by mailing the notice,
5807postage prepaid, addressed to the appointee at his or her last
5808address of record with the appointing entity. Notice so mailed
5809shall be deemed to have been given when deposited in a United
5810States Postal Service mail depository.
5811     (2)  Within 30 days after terminating the appointment
5812of an appointee, other than as to an appointment terminated by
5813the appointing entity's failure to continue or renew the
5814appointment, the appointing entity shall file with the
5815department a written notice of the termination, together with
5816a statement that the appointing entity has given the
5817appointee notice of the termination as provided in subsection
5818(1) and shall file with the department the reasons and facts
5819involved in such termination as required under s. 637.30145.
5820     (3)  Upon termination of the appointment of an appointee by
5821failure to renew or continue the appointment, the appointing
5822entity shall:
5823     (a)  File with the department the information required
5824under s. 637.30145.
5825     (b)  Subject to the exceptions provided under subsection
5826(1), continue the outstanding contracts transacted by an agent
5827until the expiration date or anniversary date when the policy is
5828a continuous policy with no expiration date. This paragraph
5829shall not be construed to prohibit the cancellation of such
5830contracts when not otherwise prohibited by law.
5831     (4)  An appointee may terminate the appointment at any
5832time by giving written or electronic notice of such termination
5833to the appointing entity, department, or person designated by the
5834department to administer the appointment process. The department
5835shall immediately terminate the appointment and notify the
5836appointing entity of such termination. Such termination shall be
5837subject to the appointee's contract rights, if any.
5838     (5)  Upon receiving a notice of termination, the department
5839or person designated by the department to administer the
5840appointment process shall terminate the appointment.
5841     637.30145  Reasons for termination.-
5842     (1)  Any insurer terminating the appointment of an agent or
5843managing general agent, whether such termination is by direct
5844action of the appointing insurer, agent, or employer or by
5845failure to renew or continue the appointment, shall file with
5846the department or office a statement of the reasons, if any, for
5847such termination and the facts relative to such termination. In
5848the case of a termination of the appointment of an agent, such
5849information may be filed by the insurer or by the general agent
5850of the insurer.
5851     (2)  In the case of terminations by failure to renew or
5852continue the appointment, the information required under
5853subsection (1) shall be filed with the department or office
5854within 30 days after the date notice of intention not to renew
5855or continue was filed with the department or office as required
5856by this chapter. In all other cases, the information required
5857under subsection (1) shall be filed with the department or
5858office within 10 days after notice of the termination was filed
5859with the department or office.
5860     637.30146  Delinquent agencies; notice of trusteeship.-If
5861any agent or agency becomes delinquent for 90 days in payment of
5862accounts owing to the insurer or insurers represented by the
5863agent or agency and a trusteeship or similar arrangement for the
5864administration of the affairs of the agent or agency is
5865instituted, the insurer or insurers involved in such trusteeship
5866or arrangement shall immediately give written notice of such
5867trusteeship or arrangement to the department. The notice shall
5868state the name and address of each such agent, the circumstances
5869and estimated amount of delinquency, and such other information
5870as the insurer deems pertinent or as the department may
5871reasonably require.
5872     637.30147  Procedure for refusal, suspension, or revocation
5873of license.-If any licensee is convicted of a violation of
5874this code or a felony, the licenses and appointments of such
5875person shall be immediately revoked by the department. The
5876licensee may subsequently request a hearing pursuant to ss.
5877120.569 and 120.57, and the department shall expedite any such
5878requested hearing. The sole issue at such hearing shall be
5879whether the revocation should be rescinded because such person
5880was not in fact convicted of a violation of this code or a
5881felony.
5882     Section 50.  Section 626.843, Florida Statutes, is
5883transferred, renumbered as section 637.3015, Florida Statutes,
5884and amended to read:
5885     637.3015 626.843  Renewal, continuation, reinstatement,
5886termination of title insurance agent's appointment.-
5887     (1)  The appointment of a title insurance agent shall
5888continue in force until suspended, revoked, or otherwise
5889terminated, but subject to a renewed request filed by the
5890insurer every 24 months after the original issue date of the
5891appointment, accompanied by payment of the renewal appointment
5892fee and taxes as prescribed in s. 637.2031 624.501.
5893     (2)(a)  Renewal of an appointment that is received by the
5894department or person designated by the department to administer
5895the appointment process prior to the expiration of an
5896appointment in the licensee's birth month or license issue date,
5897whichever applies, may be renewed by the department without
5898penalty and shall be effective as of the first day of the month
5899succeeding the month in which the appointment would have
5900expired.
5901     (b)  Renewal of an appointment that is received by the
5902department or person designated by the department to administer
5903the appointment process after the renewal date may be accepted
5904and effectuated by the department in its discretion if the
5905appointment, late filing, continuation, and reinstatement fee
5906accompanies the renewal request pursuant to s. 637.2031. Late
5907filing fees shall be paid by the appointing entity and may not
5908be charged to the appointee Title insurance agent appointments
5909shall be renewed pursuant to s. 626.381 for
5910representatives in general.
5911     (3)  The appointment issued shall remain in effect for so
5912long as the appointment represented thereby continues in force
5913as provided in this section.
5914     Section 51.  Section 626.8433, Florida Statutes, is
5915transferred and renumbered as section 637.3016, Florida
5916Statutes.
5917     Section 52.  Section 626.8437, Florida Statutes, is
5918transferred, renumbered as section 637.3017, Florida Statutes,
5919and amended to read:
5920     637.3017 626.8437  Grounds for denial, suspension,
5921revocation, or refusal to renew license or appointment.-
5922     (1)  The department shall deny, suspend, revoke, or refuse
5923to renew or continue the license or appointment of any title
5924insurance agent or agency, and it shall suspend or revoke the
5925eligibility to hold a license or appointment of such person, if
5926it finds that as to the applicant, licensee, appointee, or any
5927principal thereof, any one or more of the following grounds
5928exist:
5929     (a)(1)  Lack of one or more of the qualifications for the
5930license or appointment as specified in ss. 637.3006, 637.3007,
5931and 637.3008 626.8417, 626.8418, and 626.8419.
5932     (b)(2)  Material misstatement, misrepresentation, or fraud
5933in obtaining, or attempting to obtain, the license or
5934appointment.
5935     (c)(3)  Willful misrepresentation of any title insurance
5936policy, guarantee of title, binder, or commitment, or willful
5937deception with regard to any such policy, guarantee, binder, or
5938commitment, done either in person or by any form of
5939dissemination of information or advertising.
5940     (d)(4)  Demonstrated lack of fitness or trustworthiness to
5941represent a title insurer in the issuance of its commitments,
5942binders, policies of title insurance, or guarantees of title.
5943     (e)(5)  Demonstrated lack of reasonably adequate knowledge
5944and technical competence to engage in the transactions
5945authorized by the license or appointment.
5946     (f)(6)  Fraudulent or dishonest practices in the conduct of
5947business under the license or appointment.
5948     (g)(7)  Misappropriation, conversion, or unlawful
5949withholding of moneys belonging to title insurers or insureds or
5950others and received in conduct of business under the license or
5951appointment.
5952     (h)(8)  Unlawful rebating, or attempting to unlawfully
5953rebate, or unlawfully dividing, or offering to unlawfully
5954divide, title insurance premiums, fees, or charges with another,
5955as prohibited by s. 637.1033(7)(b). 626.9541(1)(h)3.
5956     (i)(9)  Willful failure to comply with, or willful
5957violation of, any proper order or rule of the department or
5958willful violation of any provision of this act.
5959     (j)(10)  The licensee if an individual, or the partners if
5960a partnership, or owner if a sole proprietorship, or the
5961officers if a corporation, having been found guilty of or having
5962pleaded guilty or nolo contendere to a felony or a crime
5963punishable by imprisonment of 1 year or more under the law of
5964the United States or of any state or under the law of any other
5965country which involves moral turpitude, without regard to
5966whether a judgment of conviction has been entered by the court
5967having jurisdiction of such cases.
5968     (k)  Failure to timely submit data as required by the
5969department.
5970     (2)  Upon receipt of an information or indictment, the
5971department shall immediately temporarily suspend any license or
5972appointment issued under this chapter when the licensee has been
5973convicted of an insurance or financial-related felony or a crime
5974involving moral turpitude or a crime punishable by imprisonment
5975of 1 year or more under the law of any state, territory, or
5976country. Such suspension shall continue if the licensee has been
5977found guilty of, or has pleaded guilty or no contest to, the
5978crime, whether or not a judgment or conviction has been entered,
5979during a pending appeal. A person may not affect any additional
5980insurance after suspension of his or her license or appointment.
5981However, he or she may service the policies effected prior to
5982such suspension.
5983     Section 53.  Section 626.844, Florida Statutes, is
5984transferred, renumbered as section 637.3018, Florida Statutes,
5985and amended to read:
5986     637.3018 626.844  Grounds for discretionary refusal,
5987suspension, or revocation of license or appointment.-The
5988department may, in its discretion, deny, suspend, revoke, or
5989refuse to renew or continue the license or appointment of any
5990title insurance agent or agency, and it may suspend or revoke
5991the eligibility to hold a license or appointment of any such
5992title insurance agent or agency if it finds that as to the
5993applicant or licensee or appointee, or any principal thereof,
5994any one or more of the following grounds exist under
5995circumstances for which such denial, suspension, revocation, or
5996refusal is not mandatory under s. 637.3017 626.8437:
5997     (1)  Any cause for which issuance of the license or
5998appointment could have been refused had it then existed and been
5999known to the department.
6000     (2)  Violation of any provision of this act in the course
6001of dealing under the license or appointment.
6002     (3)  Violation of any lawful order or rule of the
6003department.
6004     (4)  Failure or refusal upon demand to pay over to any
6005title insurer that the appointee represents or has represented
6006any money coming into the hands of such appointee and belonging
6007to the title insurer.
6008     (5)  Engaging in unfair methods of competition or in unfair
6009or deceptive acts or practices in the conduct of business, as
6010prohibited under part IX of this chapter, or having otherwise
6011shown himself or herself to be a source of injury or loss to the
6012public or to be detrimental to the public interest.
6013     (6)  The licensee if an individual, or the partners if a
6014partnership, or owner if a sole proprietorship, or the officers
6015if a corporation, having been found guilty of or having pleaded
6016guilty or nolo contendere to a felony or a crime punishable by
6017imprisonment of 1 year or more under the law of the United
6018States or of any state or under the law of any other country,
6019without regard to whether a judgment of conviction has been
6020entered by the court having jurisdiction of such cases.
6021     (7)  Failure or refusal upon demand by any title insurer
6022that the appointee represents or has represented to pay any
6023money coming into the hands of such appointee and belonging to
6024the title insurer.
6025     (8)  Failure to maintain the insurer's portion of the
6026premium in escrow.
6027     (9)  Fraud, misrepresentation, or deceit in any title
6028insurance transaction.
6029     (10)  Failure to comply with s. 637.3029.
6030     (11)  Failure to account or deliver to any person any
6031property that has come into the agency's hands and that is not
6032the agency's property or that the agency is not in law or equity
6033entitled to retain, under the circumstances and at the time that
6034has been agreed upon or is required by law or, in the absence of
6035a fixed time, upon demand of the person entitled to such
6036accounting and delivery absent a good faith dispute, lack of
6037mutual instructions, or doubt about entitlement thereto.
6038     (12)  Failure to disburse escrow funds in accordance with
6039agreements signed by the seller and the buyer absent a good
6040faith dispute or lack of mutual instructions from the buyer and
6041seller about entitlement thereto.
6042     (13)  Acting as or holding himself or herself out to be a
6043title insurance agent or title insurance agency without a
6044current, active license issued by the Department of Financial
6045Services.
6046     (14)  Providing a closing protection letter, title
6047insurance commitment, or title insurance policy for an insurer
6048that the licensee is not actively appointed to represent.
6049     (15)  Failure to maintain, preserve, and keep available for
6050examination all books, accounts, or other documents required by
6051ss. 637.30044-637.3015 and s. 637.3029 and the rules of the
6052department.
6053     (16)  Failure to allow an investigation or examination of
6054books and records by the department.
6055     (17)  Adding any amount to the charges of other providers
6056of service in a real estate transaction without adding value to
6057the services provided.
6058     (18)  Failure to timely deliver the deed, mortgage, and
6059other documents related to a closing transaction to the
6060appropriate recording authority.
6061     (19)  Failure to timely deliver the escrow funds to the
6062appropriate entity or to the state if the owner is unable to be
6063located pursuant to chapter 717.
6064     Section 54.  Section 626.8443, Florida Statutes, is
6065transferred, renumbered as section 637.3019, Florida Statutes,
6066and subsection (4) of that section is amended to read:
6067     637.3019 626.8443  Duration of suspension or revocation.-
6068     (4)  During the period of suspension or after revocation of
6069the license and appointment, the former licensee shall not
6070engage in or attempt to profess to engage in any transaction or
6071business for which a license or appointment is required under
6072this chapter code or directly or indirectly own, control, or be
6073employed in any manner by any title insurance agent or title
6074insurance agency or adjuster or adjusting firm.
6075     Section 55.  Section 626.8447, Florida Statutes, is
6076transferred and renumbered as section 637.3021, Florida
6077Statutes.
6078     Section 56.  Section 626.845, Florida Statutes, is
6079transferred and renumbered as section 637.3022, Florida
6080Statutes.
6081     Section 57.  Section 626.8453, Florida Statutes, is
6082transferred, renumbered as section 637.3023, Florida Statutes,
6083and amended to read:
6084     637.3023 626.8453  Penalty for violation.-A person who
6085knowingly makes a false or otherwise fraudulent application for
6086a license or appointment under this act, or who knowingly
6087violates any provision of s. 637.2032 624.5015, ss. 637.3006-
6088637.3029 626.8417-626.847, or s. 637.2076 627.791, in addition
6089to any applicable denial, suspension, revocation, or refusal to
6090renew or continue any license or appointment, commits a
6091misdemeanor of the second degree, punishable as provided in s.
6092775.082 or s. 775.083. Each instance of violation shall be
6093considered a separate offense.
6094     Section 58.  Section 626.8457, Florida Statutes, is
6095transferred and renumbered as section 637.3024, Florida
6096Statutes.
6097     Section 59.  Section 626.846, Florida Statutes, is
6098transferred, renumbered as section 637.3025, Florida Statutes,
6099and subsection (1) of that section is amended to read:
6100     637.3025 626.846  Probation.-
6101     (1)  If the department finds that one or more grounds exist
6102for the suspension of, revocation of, or refusal to renew or
6103continue any license or appointment issued under this act, the
6104department may, except when an administrative fine is not
6105permissible under s. 637.3024 626.8457 or when such suspension,
6106revocation, or refusal is mandatory, in lieu of such suspension,
6107revocation, or refusal, or in connection with any administrative
6108monetary penalty imposed under s. 637.3024 626.8457, place the
6109offending licensee or appointee on probation for a period not to
6110exceed 2 years, as specified by the department in its order.
6111     Section 60.  Section 626.8463, Florida Statutes, is
6112transferred, renumbered as section 637.3026, Florida Statutes,
6113and subsection (1) of that section is amended to read:
6114     637.3026 626.8463  Witnesses and evidence.-
6115     (1)  As to the subject of any examination, investigation,
6116or hearing being conducted by him or her under s. 637.2032, s.
6117637.2076, or 624.5015, ss. 637.3006-637.3029 626.8417-626.847,
6118or s. 627.791, an examiner appointed by the department or office
6119may administer oaths, examine and cross-examine witnesses, and
6120receive oral and documentary evidence and shall have the power
6121to subpoena witnesses, compel their attendance and testimony,
6122and require by subpoena the production of books, papers,
6123records, files, correspondence, documents, or other evidence
6124which the examiner deems relevant to the inquiry.
6125     Section 61.  Section 626.8467, Florida Statutes, is
6126transferred, renumbered as section 637.3027, Florida Statutes,
6127and amended to read:
6128     637.3027 626.8467  Testimony compelled; immunity from
6129prosecution.-
6130     (1)  If a person asks to be excused from attending or
6131testifying or from producing any books, papers, records,
6132contracts, documents, or other evidence in connection with any
6133examination, hearing, or investigation being conducted under s.
6134637.2032, s. 637.2076, or 624.5015, ss. 637.3006-637.3029
6135626.8417-626.847, or s. 627.791 by the department or office or
6136its examiner on the ground that the testimony or evidence
6137required of the person may tend to incriminate him or her or
6138subject him or her to a penalty or forfeiture and
6139notwithstanding is directed to give such testimony or produce
6140such evidence, the person must, if so directed by the Department
6141of Financial Services and the Department of Legal Affairs or by
6142the office and the Department of Legal Affairs, nonetheless
6143comply with such direction, but he or she shall not thereafter
6144be prosecuted or subjected to any penalty or forfeiture for or
6145on account of any transaction, matter, or thing concerning which
6146he or she may have so testified or produced evidence, and no
6147testimony so given or evidence produced shall be received
6148against the person upon any criminal action, investigation, or
6149proceeding. However, a person so testifying shall not be exempt
6150from prosecution or punishment for any perjury committed by him
6151or her in such testimony, and the testimony or evidence so given
6152or produced shall be admissible against him or her upon any
6153criminal action, investigation, or proceeding concerning such
6154perjury; and such person shall not be exempt from the refusal,
6155suspension, or revocation of any license or appointment,
6156permission, or authority conferred or to be conferred pursuant
6157to s. 637.2032, s. 637.2076, or 624.5015, ss. 637.3006-637.3029
6158626.8417-626.847, or s. 627.791.
6159     (2)  Any such person may execute, acknowledge, and file
6160with the department of Financial Services or the office, as
6161appropriate, a statement expressly waiving such immunity or
6162privilege with respect to any transaction, matter, or thing
6163specified in the statement, and thereupon the testimony of such
6164person or such evidence in relation to such transaction, matter,
6165or thing may be received or produced before any judge or
6166justice, court, tribunal, or grand jury or otherwise and, if so
6167received or produced, such person shall not be entitled to any
6168immunity or privilege on account of any testimony he or she may
6169so give or evidence so produced.
6170     Section 62.  Section 626.847, Florida Statutes, is
6171transferred, renumbered as section 637.3028, Florida Statutes,
6172and amended to read:
6173     637.3028 626.847  Penalty for refusal to testify.-A person
6174who refuses or fails, without lawful cause, to testify relative
6175to the affairs of any title insurer or other person when
6176subpoenaed under s. 637.3026 626.8463 and requested by the
6177department or office to so testify is guilty of a misdemeanor of
6178the second degree and, upon conviction, is punishable as
6179provided in s. 775.082 or s. 775.083.
6180     Section 63.  Section 626.8473, Florida Statutes, is
6181transferred, renumbered as section 637.3029, Florida Statutes,
6182and subsections (1), (3), and (6) of that section are amended to
6183read:
6184     637.3029 626.8473  Escrow; trust fund.-
6185     (1)  A title insurance agent may engage in business as an
6186escrow agent as to funds received from others to be subsequently
6187disbursed by the title insurance agent in connection with real
6188estate closing transactions involving the issuance of title
6189insurance binders, commitments, policies of title insurance, or
6190guarantees of title, provided that a licensed and appointed
6191title insurance agent complies with the requirements of s.
6192637.3006 626.8417, including such requirements added after the
6193initial licensure of the agent.
6194     (3)  All funds received by a title insurance agent to be
6195held in trust shall be immediately placed and retained in a
6196financial institution that is located within this state and is a
6197member of the Federal Deposit Insurance Corporation or the
6198National Credit Union Share Insurance Fund. These funds shall be
6199invested in an escrow account in accordance with the investment
6200requirements and standards established for deposits and
6201investments of state funds in s. 17.57, where the funds shall be
6202kept until disbursement thereof is properly authorized.
6203     (6)  In the event that the department adopts promulgates
6204rules necessary to implement the requirements of this section
6205pursuant to s. 637.1007 624.308, the department shall consider
6206reasonable standards necessary for the protection of funds held
6207in trust, including, but not limited to, standards for
6208accounting of funds, standards for receipt and disbursement of
6209funds, and protection for the person or persons to whom the
6210funds are to be disbursed.
6211     Section 64.  Section 637.30295, Florida Statutes, is
6212created to read:
6213     637.30295  Collection of title insurance information.-Each
6214title insurance agency licensed to do business in this state and
6215each insurer doing direct, retail, or affiliated business in
6216this state shall maintain and submit information, including
6217revenue, loss, and expense data, as the department determines to
6218be necessary to assist in the analysis of title insurance premium
6219rates, title search costs, and the condition of the title
6220insurance industry in this state. This information must be
6221transmitted to the department no later than March 31 of each
6222year following the reporting year. The department shall adopt
6223rules to assist in the collection and analysis of the data from
6224the title insurance industry.
6225     Section 65.  Paragraphs (a), (e), and (f) of subsection (1)
6226of section 624.5105, Florida Statutes, are amended to read:
6227     624.5105  Community contribution tax credit; authorization;
6228limitations; eligibility and application requirements;
6229administration; definitions; expiration.-
6230     (1)  AUTHORIZATION TO GRANT TAX CREDITS; LIMITATIONS.-
6231     (a)  There shall be allowed a credit of 50 percent of a
6232community contribution against any tax due for a calendar year
6233under s. 624.509, or s. 624.510, or s. 637.2039.
6234     (e)  If the credit granted pursuant to this section is not
6235fully used in any one year because of insufficient tax liability
6236on the part of the insurer, the unused amount may be carried
6237forward for a period not to exceed 5 years. The carryover credit
6238may be used in a subsequent year when the tax imposed by s.
6239624.509, or s. 624.510, or 637.2039 for such year exceeds the
6240credit under this section for such year.
6241     (f)  An insurer that claims a credit against premium-tax
6242liability earned by making a community contribution under this
6243section need not pay any additional retaliatory tax levied under
6244s. 624.5091 or s. 637.2041 as a result of claiming such a
6245credit. Section 624.5091 or s. 637.2041 does not limit such a
6246credit in any manner.
6247     Section 66.  Subsection (1) of section 624.5107, Florida
6248Statutes, is amended to read:
6249     624.5107  Child care tax credits.-
6250     (1)  If the credit granted under this section is not fully
6251used in any one year because of insufficient tax liability on
6252the part of the insurer, the unused amount may be carried
6253forward for a period not to exceed 5 years. The carryover credit
6254may be used in a subsequent year when the tax imposed by s.
6255624.509, or s. 624.510, or s. 637.2039 for that year exceeds the
6256credit for which the insurer is eligible in that year under this
6257section.
6258     Section 67.  Transfers; rules; powers; regulatory
6259authority; orders.-
6260     (1)  Effective October 1, 2010, the rules of the Financial
6261Services Commission and the Office of Insurance Regulation with
6262respect to the regulation of title insurance shall become the
6263rules of the Department of Financial Services and shall remain
6264in effect until specifically amended or repealed in the manner
6265provided by law.
6266     (2)(a)  All of the statutory powers, duties and functions,
6267records, personnel, property, and unexpended balances of
6268appropriations, allocations, or other funds for the
6269administration of chapter 624, Florida Statutes, related to
6270title insurance, shall be transferred by a type two transfer, as
6271defined in s. 20.06(2), Florida Statutes, from the Financial
6272Services Commission and the Office of Insurance Regulation to
6273the Department of Financial Services.
6274     (b)  All of the statutory powers, duties and functions,
6275records, personnel, property, and unexpended balances of
6276appropriations, allocations, or other funds for the
6277administration of chapter 626, Florida Statutes, related to
6278title insurance, shall be transferred by a type two transfer, as
6279defined in s. 20.06(2), Florida Statutes, from the Financial
6280Services Commission and the Office of Insurance Regulation to
6281the Department of Financial Services.
6282     (c)  All of the statutory powers, duties and functions,
6283records, personnel, property, and unexpended balances of
6284appropriations, allocations, or other funds for the
6285administration of chapter 627, Florida Statutes, related to
6286title insurance, shall be transferred by a type two transfer, as
6287defined in s. 20.06(2), Florida Statutes, from the Financial
6288Services Commission and the Office of Insurance Regulation to
6289the Department of Financial Services.
6290     (3)(a)  The transfer of regulatory authority under chapter
6291624, Florida Statutes, provided by this act shall not affect the
6292validity of any judicial or administrative action relating to
6293title insurance pending as of 11:59 p.m. on the day before the
6294effective date of this act, to which action the Financial
6295Services Commission or the Office of Insurance Regulation are at
6296that time parties, and the Department of Financial Services
6297shall be substituted as a party in interest in any such action.
6298     (b)  The transfer of regulatory authority under chapter
6299626, Florida Statutes, provided by this act shall not affect the
6300validity of any judicial or administrative action relating to
6301title insurance pending as of 11:59 p.m. on the day before the
6302effective date of this act, to which action the Financial
6303Services Commission or the Office of Insurance Regulation are at
6304that time parties, and the Department of Financial Services
6305shall be substituted as a party in interest in any such action.
6306     (c)  The transfer of regulatory authority under chapter
6307627, Florida Statutes, provided by this act shall not affect the
6308validity of any judicial or administrative action relating to
6309title insurance pending as of 11:59 p.m. on the day before the
6310effective date of this act, to which action the Financial
6311Services Commission or the Office of Insurance Regulation are at
6312that time parties, and the Department of Financial Services
6313shall be substituted as a party in interest in any such action.
6314     (4)(a)  All lawful orders issued by the Financial Services
6315Commission or the Office of Insurance Regulation implementing or
6316enforcing or otherwise in regard to any provision of chapter
6317624, Florida Statutes, relating to title insurance, issued prior
6318to the effective date of this act, shall remain in effect and be
6319enforceable after the effective date of this act, unless
6320thereafter modified in accordance with law.
6321     (b)  All lawful orders issued by the Financial Services
6322Commission or the Office of Insurance Regulation, implementing
6323or enforcing or otherwise in regard to any provision of chapter
6324626, Florida Statutes, relating to title insurance, issued prior
6325to the effective date of this act, shall remain in effect and be
6326enforceable after the effective date of this act, unless
6327thereafter modified in accordance with law.
6328     (c)  All lawful orders issued by the Financial Services
6329Commission or the Office of Insurance Regulation, implementing
6330or enforcing or otherwise in regard to any provision of chapter
6331627, Florida Statutes, relating to title insurance, issued prior
6332to the effective date of this act, shall remain in effect and be
6333enforceable after the effective date of this act, unless
6334thereafter modified in accordance with law.
6335     Section 68.  The Legislature recognizes that there is a
6336need to conform the Florida Statutes to the policy decisions
6337reflected in the provisions of this act. The Division of
6338Statutory Revision is directed to provide the relevant
6339substantive committees of the Senate and the House of
6340Representatives with assistance, upon request, to enable such
6341committees to prepare draft legislation to conform the Florida
6342Statutes to the provisions of this act.
6343     Section 69.  Section 689.263, Florida Statutes, is created
6344to read:
6345     689.263  Sale of residential property; settlement statement
6346requirements.-A title insurance agent or title insurance agency
6347may not disburse funds pursuant to a completed purchase and sale
6348transaction subject to the Real Estate Settlement Procedures Act
6349of 1974, 12 U.S.C. ss. 2601 et seq., as amended, without
6350requiring a statement of settlement costs meeting the following
6351requirements:
6352     (1)  The settlement statement must be executed by the buyer
6353and the seller.
6354     (2)  If a title insurance premium is to be disbursed, the
6355title insurer and the title insurance agent or title insurance
6356agency, if any, must be disclosed.
6357     (3)  A copy of the executed settlement statement must be
6358delivered to the buyer and the seller.
6359     Section 70.  Section 717.1121, Florida Statutes, is created
6360to read:
6361     717.1121  Payments from escrow related to real estate
6362transactions.-All funds held as part of a real estate
6363transaction, including any outstanding payments for amounts to
6364be paid as listed on the settlement statement form by any title
6365insurance agency, title insurer, savings and loan association,
6366bank, trust company, or other financial institution, attorney
6367firm, real estate broker, or similar institution, are considered
6368unclaimed if the owner of those funds has not claimed the money
6369within 2 years after the closing performed under the real estate
6370transaction.
6371     Section 71.  Subsection (1) and paragraph (d) of subsection
6372(2) of section 877.101, Florida Statutes, are amended to read:
6373     877.101  Escrow business by unauthorized persons; use of
6374name.-
6375     (1)  Except as provided in subsection (2), in connection
6376with the purchase and sale of real property, a person may not:
6377     (a)  Transact business under any name or title that
6378contains the word "escrow" or words of similar import; or
6379     (b)1.  Use any name, word, sign, symbol, or device in any
6380context or in any manner; or
6381     2.  Circulate or use any letterhead, billhead, circular,
6382paper, or writing of any kind or otherwise advertise or
6383represent in any manner
6384
6385that indicates or reasonably implies that the business being
6386conducted or advertised is the kind or character of business
6387transacted that is regulated by this state as an escrow agent;
6388or
6389     (c)  Engage in business as an escrow agent as to funds
6390received from others to be subsequently disbursed in connection
6391with real estate closing transactions.
6392     (2)  This section does not apply to:
6393     (d)  A title insurance agent who is licensed pursuant to s.
6394637.3006 626.8417, a title insurance agency that is licensed
6395pursuant to s. 637.3007 626.8418, or a title insurer who is
6396authorized to transact business in this state pursuant to s.
6397637.2001 624.401.
6398     Section 72.  Section 624.5015, Florida Statutes, is amended
6399to read:
6400     624.5015  Advance collection of fees and taxes; title
6401insurers not to pay without reimbursement.-
6402     (1)  The department or the office shall collect in advance
6403from the applicant or licensee fees and taxes as provided in s.
6404624.501.
6405     (2)  A title insurer shall not pay directly or indirectly
6406without reimbursement from a title insurance agent any
6407appointment fee required under this section. The failure of a
6408title insurance agent to make reimbursement is not a ground for
6409cancellation of the title insurance agent's appointment by the
6410title insurer.
6411     Section 73.  Subsections (7), (8), and (9) of section
6412626.241, Florida Statutes, are amended to read:
6413     626.241  Scope of examination.-
6414     (7)  Examinations given applicants for licensure as title
6415agents must cover title insurance, abstracting, title searches,
6416examination of title, closing procedures, and escrow handling.
6417     (7)(8)  An examination for licensure as a personal lines
6418agent shall consist of 100 questions and shall be limited in
6419scope to the kinds of business transacted under such license.
6420     (8)(9)  This section applies to any person who submits an
6421application for license and to any person who submits an
6422application for examination prior to filing an application for
6423license.
6424     Section 74.  Subsection (5) of section 626.331, Florida
6425Statutes, is amended to read:
6426     626.331  Number of appointments permitted or required.-
6427     (5)  A title agent or title agency license must be limited
6428to selling title insurance only for the appointing title insurer
6429or insurers.
6430     Section 75.  Paragraph (a) of subsection (5) of section
6431197.502, Florida Statutes, is amended to read:
6432     197.502  Application for obtaining tax deed by holder of
6433tax sale certificate; fees.-
6434     (5)(a)  The tax collector may contract with a title company
6435or an abstract company at a reasonable fee to provide the
6436minimum information required in subsection (4), consistent with
6437rules adopted by the department. If additional information is
6438required, the tax collector must make a written request to the
6439title or abstract company stating the additional requirements.
6440The tax collector may select any title or abstract company,
6441regardless of its location, as long as the fee is reasonable,
6442the minimum information is submitted, and the title or abstract
6443company is authorized to do business in this state. The tax
6444collector may advertise and accept bids for the title or
6445abstract company if he or she considers it appropriate to do so.
6446     1.  The ownership and encumbrance report must be printed or
6447typed on stationery or other paper showing a letterhead of the
6448person, firm, or company that makes the search, and the
6449signature of the person who makes the search or of an officer of
6450the firm must be attached. The tax collector is not liable for
6451payment to the firm unless these requirements are met.
6452     2.  The tax collector may not accept or pay for any title
6453search or abstract if no financial responsibility is assumed for
6454the search. However, reasonable restrictions as to the liability
6455or responsibility of the title or abstract company are
6456acceptable. Notwithstanding s. 637.2071(3) 627.7843(3), the tax
6457collector may contract for higher maximum liability limits.
6458     3.  In order to establish uniform prices for ownership and
6459encumbrance reports within the county, the tax collector shall
6460ensure that the contract for ownership and encumbrance reports
6461include all requests for title searches or abstracts for a given
6462period of time.
6463     Section 76.  Paragraph (d) of subsection (27) of section
6464624.501, Florida Statutes, is amended to read:
6465     624.501  Filing, license, appointment, and miscellaneous
6466fees.-The department, commission, or office, as appropriate,
6467shall collect in advance, and persons so served shall pay to it
6468in advance, fees, licenses, and miscellaneous charges as
6469follows:
6470     (27)  Title insurance agents:
6471     (d)  Additional appointment continuation fee as prescribed
6472by s. 637.3015 626.843     $5.00
6473     Section 77.  Section 624.604, Florida Statutes, is amended
6474to read:
6475     624.604  "Property insurance" defined.-"Property insurance"
6476is insurance on real or personal property of every kind and of
6477every interest therein, whether on land, water, or in the air,
6478against loss or damage from any and all hazard or cause, and
6479against loss consequential upon such loss or damage, other than
6480noncontractual legal liability for any such loss or damage.
6481Property insurance may contain a provision for accidental death
6482or injury as part of a multiple peril homeowner's policy. Such
6483insurance, which is incidental to the property insurance, is not
6484subject to the provisions of this code applicable to life or
6485health insurance. Property insurance does not include title
6486insurance, as defined in s. 637.1004 624.608.
6487     Section 78.  Paragraph (r) of subsection (1) of section
6488624.605, Florida Statutes, is amended to read:
6489     624.605  "Casualty insurance" defined.-
6490     (1)  "Casualty insurance" includes:
6491     (r)  Insurance for debt cancellation products.-Insurance
6492that a creditor may purchase against the risk of financial loss
6493from the use of debt cancellation products with consumer loans
6494or leases or retail installment contracts. Insurance for debt
6495cancellation products is not liability insurance but shall be
6496considered credit insurance only for the purposes of s.
6497631.52(4).
6498     1.  For purposes of this paragraph, the term "debt
6499cancellation products" means loan, lease, or retail installment
6500contract terms, or modifications to loan, lease, or retail
6501installment contracts, under which a creditor agrees to cancel
6502or suspend all or part of a customer's obligation to make
6503payments upon the occurrence of specified events and includes,
6504but is not limited to, debt cancellation contracts, debt
6505suspension agreements, and guaranteed asset protection
6506contracts. However, the term "debt cancellation products" does
6507not include title insurance as defined in s. 637.1004 624.608.
6508     2.  Debt cancellation products may be offered by financial
6509institutions, as defined in s. 655.005(1)(h), insured depository
6510institutions as defined in 12 U.S.C. s. 1813(c), and
6511subsidiaries of such institutions, as provided in the financial
6512institutions codes; by sellers as defined in s. 721.05, or by
6513the parents, subsidiaries, or affiliated entities of sellers, in
6514connection with the sale of timeshare interests; or by other
6515business entities as may be specifically authorized by law, and
6516such products shall not constitute insurance for purposes of the
6517Florida Insurance Code.
6518     Section 79.  Subsection (4) of section 625.031, Florida
6519Statutes, is amended to read:
6520     625.031  Assets not allowed.-In addition to assets
6521impliedly excluded by the provisions of s. 625.012, the
6522following expressly shall not be allowed as assets in any
6523determination of the financial condition of an insurer:
6524     (4)  Furniture, fixtures, furnishings, safes, vehicles,
6525libraries, stationery, literature, and supplies, other than data
6526processing and accounting systems authorized under s.
6527625.012(11), except in the case of title insurers such materials
6528and plants as the insurer is expressly authorized to invest in
6529under s. 637.20073 625.330 and except, in the case of any
6530insurer, such personal property as the insurer is permitted to
6531hold pursuant to part II of this chapter, or which is acquired
6532through foreclosure of chattel mortgages acquired pursuant to s.
6533625.329, or which is reasonably necessary for the maintenance
6534and operation of real estate lawfully acquired and held by the
6535insurer other than real estate used by it for home office,
6536branch office, and similar purposes.
6537     Section 80.  Section 626.207, Florida Statutes, is amended
6538to read:
6539     626.207  Department rulemaking authority; waiting periods
6540for applicants; penalties against licensees.-
6541     (1)  The department shall adopt rules establishing specific
6542waiting periods for applicants to become eligible for licensure
6543following denial, suspension, or revocation pursuant to s.
6544626.611, s. 626.621, s. 637.3017 626.8437, s. 637.3018 626.844,
6545s. 626.935, s. 634.181, s. 634.191, s. 634.320, s. 634.321, s.
6546634.422, s. 634.423, s. 642.041, or s. 642.043. The purpose of
6547the waiting periods is to provide sufficient time to demonstrate
6548reformation of character and rehabilitation. The waiting periods
6549shall vary based on the type of conduct and the length of time
6550since the conduct occurred and shall also be based on the
6551probability that the propensity to commit illegal conduct has
6552been overcome. The waiting periods may be adjusted based on
6553aggravating and mitigating factors established by rule and
6554consistent with this purpose.
6555     (2)  The department shall adopt rules establishing specific
6556penalties against licensees for violations of s. 626.611, s.
6557626.621, s. 637.3017 626.8437, s. 637.3018 626.844, s. 626.935,
6558s. 634.181, s. 634.191, s. 634.320, s. 634.321, s. 634.422, s.
6559634.423, s. 642.041, or s. 642.043. The purpose of the
6560revocation or suspension is to provide a sufficient penalty to
6561deter future violations of the Florida Insurance Code. The
6562imposition of a revocation or the length of suspension shall be
6563based on the type of conduct and the probability that the
6564propensity to commit further illegal conduct has been overcome
6565at the time of eligibility for relicensure. The revocation or
6566the length of suspension may be adjusted based on aggravating or
6567mitigating factors, established by rule and consistent with this
6568purpose.
6569     Section 81.  Paragraph (t) of subsection (1) of section
6570655.005, Florida Statutes, is amended to read:
6571     655.005  Definitions.-
6572     (1)  As used in the financial institutions codes, unless
6573the context otherwise requires, the term:
6574     (t)  "Debt cancellation products" means loan, lease, or
6575retail installment contract terms, or modifications or addenda
6576to loan, lease, or retail installment contracts, under which a
6577creditor agrees to cancel or suspend all or part of a customer's
6578obligation to make payments upon the occurrence of specified
6579events and includes, but is not limited to, debt cancellation
6580contracts, debt suspension agreements, and guaranteed asset
6581protection contracts offered by financial institutions, insured
6582depository institutions as defined in 12 U.S.C. s. 1813(c), and
6583subsidiaries of such institutions. However, the term "debt
6584cancellation products" does not include title insurance as
6585defined in s. 637.1004 624.608.
6586     Section 82.  Paragraph (d) of subsection (6) of section
6587701.041, Florida Statutes, is amended to read:
6588     701.041  Title insurer; mortgage release certificate.-
6589     (6)  LIABILITY OF TITLE INSURER AND TITLE INSURANCE AGENT.-
6590     (d)  Liability of a title insurer pursuant to this section
6591shall be considered to be a title insurance claim on real
6592property in this state pursuant to s. 637.2075 627.7865.
6593     Section 83.  Paragraph (d) of subsection (14) of section
6594721.05, Florida Statutes, is amended to read:
6595     721.05  Definitions.-As used in this chapter, the term:
6596     (14)  "Escrow agent" includes only:
6597     (d)  A title insurance agent that is licensed pursuant to
6598s. 637.3006 626.8417, a title insurance agency that is licensed
6599pursuant to s. 637.3007 626.8418, or a title insurer authorized
6600to transact business in this state pursuant to s. 637.2001
6601624.401.
6602     Section 84.  Sections 624.608, 626.841, 626.8411, 626.9531,
6603627.7711, and 627.776, Florida Statutes, are repealed.
6604     Section 85.  This act shall take effect October 1, 2010.


CODING: Words stricken are deletions; words underlined are additions.
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