October 20, 2019
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       Florida Senate - 2010                                     SB 876
       
       
       
       By Senator Bennett
       
       
       
       
       21-00469C-10                                           2010876__
    1                        A bill to be entitled                      
    2         An act relating to residential property insurance;
    3         amending s. 627.062, F.S.; authorizing certain
    4         insurers to use a rate different from otherwise
    5         applicable filed rates; prohibiting the consideration
    6         of certain policies when making a specified
    7         calculation; preserving the authority of the Office of
    8         Insurance Regulation to disapprove rates as inadequate
    9         or disapprove a rate filing for using certain rating
   10         factors; authorizing the office to direct an insurer
   11         to make a specified type of rate filing under certain
   12         circumstances; amending s. 627.351, F.S.; providing
   13         requirements for attachment and payment of the
   14         Citizens policyholder surcharge; prohibiting the
   15         corporation from levying certain regular assessments
   16         until after levying the full amount of a Citizens
   17         policyholder surcharge; requiring the corporation’s
   18         plan of operation to require agents to obtain an
   19         acknowledgement of potential surcharge and assessment
   20         liability from applicants and policyholders; requiring
   21         the corporation to permanently retain a copy of such
   22         acknowledgments; specifying that the acknowledgement
   23         creates a conclusive presumption of understanding and
   24         acceptance by the policyholder; creating s. 627.7031,
   25         F.S.; authorizing certain insurers to offer or renew
   26         policies at rates established under certain
   27         circumstances; prohibiting certain insurers from
   28         purchasing TICL option coverage from the Florida
   29         Hurricane Catastrophe Fund under certain
   30         circumstances; requiring that certain policies contain
   31         a specified rate notice; requiring insurers to offer
   32         applicants or insureds an estimate of the premium for
   33         a policy from Citizens Property Insurance Corporation
   34         reflecting similar coverage, limits, and deductibles;
   35         requiring applicants or insureds to provide a signed
   36         premium comparison acknowledgement; specifying
   37         criteria for insurer compliance with certain
   38         requirements; specifying acknowledgement contents;
   39         requiring insurers and agents to retain a copy of the
   40         acknowledgement for a specified time; specifying a
   41         presumption created by a signed acknowledgement;
   42         specifying types of residential property insurance
   43         policies that are not eligible for certain rates or
   44         subject to other requirements; requiring written
   45         notice of certain nonrenewals; preserving insurer
   46         authority to cancel policies; specifying a criterion
   47         for what constitutes an offer to renew a policy;
   48         providing an effective date.
   49  
   50  Be It Enacted by the Legislature of the State of Florida:
   51  
   52         Section 1. Paragraph (l) is added to subsection (2) of
   53  section 627.062, Florida Statutes, to read:
   54         627.062 Rate standards.—
   55         (2) As to all such classes of insurance:
   56         (l)1. An insurer complying with the requirements of s.
   57  627.7031 may use a rate for residential property insurance, as
   58  defined in s. 627.4025, different from the otherwise applicable
   59  filed rate as provided in this paragraph.
   60         2. Policies subject to this paragraph may not be counted in
   61  the calculation under s. 627.171(2).
   62         3. Such rates shall be filed with the office as a separate
   63  filing.
   64         4. This paragraph does not affect the authority of the
   65  office to disapprove a rate as inadequate or to disapprove a
   66  rate filing for charging any insured or applicant a higher
   67  premium solely because of the insured’s or applicant’s race,
   68  color, creed, marital status, sex, or national origin. Upon
   69  finding that an insurer has used any such factor in charging an
   70  insured or applicant a higher premium, the office may direct the
   71  insurer to make a new filing for a new rate that does not use
   72  such factor.
   73  
   74  The provisions of this subsection shall not apply to workers’
   75  compensation and employer’s liability insurance and to motor
   76  vehicle insurance.
   77         Section 2. Paragraphs (g) through (ff) of subsection (6) of
   78  section 627.351, Florida Statutes, are redesignated as
   79  paragraphs (f) through (ee), respectively, present paragraph (f)
   80  of that subsection is redesignated as paragraph (ff), and
   81  paragraphs (b) and (c) of subsection (6) of section 627.351,
   82  Florida Statutes, are amended to read:
   83         627.351 Insurance risk apportionment plans.—
   84         (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
   85         (b)1. All insurers authorized to write one or more subject
   86  lines of business in this state are subject to assessment by the
   87  corporation and, for the purposes of this subsection, are
   88  referred to collectively as “assessable insurers.” Insurers
   89  writing one or more subject lines of business in this state
   90  pursuant to part VIII of chapter 626 are not assessable
   91  insurers, but insureds who procure one or more subject lines of
   92  business in this state pursuant to part VIII of chapter 626 are
   93  subject to assessment by the corporation and are referred to
   94  collectively as “assessable insureds.” An authorized insurer’s
   95  assessment liability shall begin on the first day of the
   96  calendar year following the year in which the insurer was issued
   97  a certificate of authority to transact insurance for subject
   98  lines of business in this state and shall terminate 1 year after
   99  the end of the first calendar year during which the insurer no
  100  longer holds a certificate of authority to transact insurance
  101  for subject lines of business in this state.
  102         2.a. All revenues, assets, liabilities, losses, and
  103  expenses of the corporation shall be divided into three separate
  104  accounts as follows:
  105         (I) A personal lines account for personal residential
  106  policies issued by the corporation or issued by the Residential
  107  Property and Casualty Joint Underwriting Association and renewed
  108  by the corporation that provide comprehensive, multiperil
  109  coverage on risks that are not located in areas eligible for
  110  coverage in the Florida Windstorm Underwriting Association as
  111  those areas were defined on January 1, 2002, and for such
  112  policies that do not provide coverage for the peril of wind on
  113  risks that are located in such areas;
  114         (II) A commercial lines account for commercial residential
  115  and commercial nonresidential policies issued by the corporation
  116  or issued by the Residential Property and Casualty Joint
  117  Underwriting Association and renewed by the corporation that
  118  provide coverage for basic property perils on risks that are not
  119  located in areas eligible for coverage in the Florida Windstorm
  120  Underwriting Association as those areas were defined on January
  121  1, 2002, and for such policies that do not provide coverage for
  122  the peril of wind on risks that are located in such areas; and
  123         (III) A high-risk account for personal residential policies
  124  and commercial residential and commercial nonresidential
  125  property policies issued by the corporation or transferred to
  126  the corporation that provide coverage for the peril of wind on
  127  risks that are located in areas eligible for coverage in the
  128  Florida Windstorm Underwriting Association as those areas were
  129  defined on January 1, 2002. The corporation may offer policies
  130  that provide multiperil coverage and the corporation shall
  131  continue to offer policies that provide coverage only for the
  132  peril of wind for risks located in areas eligible for coverage
  133  in the high-risk account. In issuing multiperil coverage, the
  134  corporation may use its approved policy forms and rates for the
  135  personal lines account. An applicant or insured who is eligible
  136  to purchase a multiperil policy from the corporation may
  137  purchase a multiperil policy from an authorized insurer without
  138  prejudice to the applicant’s or insured’s eligibility to
  139  prospectively purchase a policy that provides coverage only for
  140  the peril of wind from the corporation. An applicant or insured
  141  who is eligible for a corporation policy that provides coverage
  142  only for the peril of wind may elect to purchase or retain such
  143  policy and also purchase or retain coverage excluding wind from
  144  an authorized insurer without prejudice to the applicant’s or
  145  insured’s eligibility to prospectively purchase a policy that
  146  provides multiperil coverage from the corporation. It is the
  147  goal of the Legislature that there would be an overall average
  148  savings of 10 percent or more for a policyholder who currently
  149  has a wind-only policy with the corporation, and an ex-wind
  150  policy with a voluntary insurer or the corporation, and who then
  151  obtains a multiperil policy from the corporation. It is the
  152  intent of the Legislature that the offer of multiperil coverage
  153  in the high-risk account be made and implemented in a manner
  154  that does not adversely affect the tax-exempt status of the
  155  corporation or creditworthiness of or security for currently
  156  outstanding financing obligations or credit facilities of the
  157  high-risk account, the personal lines account, or the commercial
  158  lines account. The high-risk account must also include quota
  159  share primary insurance under subparagraph (c)2. The area
  160  eligible for coverage under the high-risk account also includes
  161  the area within Port Canaveral, which is bordered on the south
  162  by the City of Cape Canaveral, bordered on the west by the
  163  Banana River, and bordered on the north by Federal Government
  164  property.
  165         b. The three separate accounts must be maintained as long
  166  as financing obligations entered into by the Florida Windstorm
  167  Underwriting Association or Residential Property and Casualty
  168  Joint Underwriting Association are outstanding, in accordance
  169  with the terms of the corresponding financing documents. When
  170  the financing obligations are no longer outstanding, in
  171  accordance with the terms of the corresponding financing
  172  documents, the corporation may use a single account for all
  173  revenues, assets, liabilities, losses, and expenses of the
  174  corporation. Consistent with the requirement of this
  175  subparagraph and prudent investment policies that minimize the
  176  cost of carrying debt, the board shall exercise its best efforts
  177  to retire existing debt or to obtain approval of necessary
  178  parties to amend the terms of existing debt, so as to structure
  179  the most efficient plan to consolidate the three separate
  180  accounts into a single account. By February 1, 2007, the board
  181  shall submit a report to the Financial Services Commission, the
  182  President of the Senate, and the Speaker of the House of
  183  Representatives which includes an analysis of consolidating the
  184  accounts, the actions the board has taken to minimize the cost
  185  of carrying debt, and its recommendations for executing the most
  186  efficient plan.
  187         c. Creditors of the Residential Property and Casualty Joint
  188  Underwriting Association and of the accounts specified in sub
  189  sub-subparagraphs a.(I) and (II) may have a claim against, and
  190  recourse to, the accounts referred to in sub-sub-subparagraphs
  191  a.(I) and (II) and shall have no claim against, or recourse to,
  192  the account referred to in sub-sub-subparagraph a.(III).
  193  Creditors of the Florida Windstorm Underwriting Association
  194  shall have a claim against, and recourse to, the account
  195  referred to in sub-sub-subparagraph a.(III) and shall have no
  196  claim against, or recourse to, the accounts referred to in sub
  197  sub-subparagraphs a.(I) and (II).
  198         d. Revenues, assets, liabilities, losses, and expenses not
  199  attributable to particular accounts shall be prorated among the
  200  accounts.
  201         e. The Legislature finds that the revenues of the
  202  corporation are revenues that are necessary to meet the
  203  requirements set forth in documents authorizing the issuance of
  204  bonds under this subsection.
  205         f. No part of the income of the corporation may inure to
  206  the benefit of any private person.
  207         3. With respect to a deficit in an account:
  208         a. After accounting for the Citizens policyholder surcharge
  209  imposed under sub-subparagraph i., when the remaining projected
  210  deficit incurred in a particular calendar year is not greater
  211  than 6 percent of the aggregate statewide direct written premium
  212  for the subject lines of business for the prior calendar year,
  213  the entire deficit shall be recovered through regular
  214  assessments of assessable insurers under paragraph (p) and
  215  assessable insureds.
  216         b. After accounting for the Citizens policyholder surcharge
  217  imposed under sub-subparagraph i., when the remaining projected
  218  deficit incurred in a particular calendar year exceeds 6 percent
  219  of the aggregate statewide direct written premium for the
  220  subject lines of business for the prior calendar year, the
  221  corporation shall levy regular assessments on assessable
  222  insurers under paragraph (p) and on assessable insureds in an
  223  amount equal to the greater of 6 percent of the deficit or 6
  224  percent of the aggregate statewide direct written premium for
  225  the subject lines of business for the prior calendar year. Any
  226  remaining deficit shall be recovered through emergency
  227  assessments under sub-subparagraph d.
  228         c. Each assessable insurer’s share of the amount being
  229  assessed under sub-subparagraph a. or sub-subparagraph b. shall
  230  be in the proportion that the assessable insurer’s direct
  231  written premium for the subject lines of business for the year
  232  preceding the assessment bears to the aggregate statewide direct
  233  written premium for the subject lines of business for that year.
  234  The assessment percentage applicable to each assessable insured
  235  is the ratio of the amount being assessed under sub-subparagraph
  236  a. or sub-subparagraph b. to the aggregate statewide direct
  237  written premium for the subject lines of business for the prior
  238  year. Assessments levied by the corporation on assessable
  239  insurers under sub-subparagraphs a. and b. shall be paid as
  240  required by the corporation’s plan of operation and paragraph
  241  (p). Assessments levied by the corporation on assessable
  242  insureds under sub-subparagraphs a. and b. shall be collected by
  243  the surplus lines agent at the time the surplus lines agent
  244  collects the surplus lines tax required by s. 626.932 and shall
  245  be paid to the Florida Surplus Lines Service Office at the time
  246  the surplus lines agent pays the surplus lines tax to the
  247  Florida Surplus Lines Service Office. Upon receipt of regular
  248  assessments from surplus lines agents, the Florida Surplus Lines
  249  Service Office shall transfer the assessments directly to the
  250  corporation as determined by the corporation.
  251         d. Upon a determination by the board of governors that a
  252  deficit in an account exceeds the amount that will be recovered
  253  through regular assessments under sub-subparagraph a. or sub
  254  subparagraph b., plus the amount that is expected to be
  255  recovered through surcharges under sub-subparagraph i., as to
  256  the remaining projected deficit the board shall levy, after
  257  verification by the office, emergency assessments, for as many
  258  years as necessary to cover the deficits, to be collected by
  259  assessable insurers and the corporation and collected from
  260  assessable insureds upon issuance or renewal of policies for
  261  subject lines of business, excluding National Flood Insurance
  262  policies. The amount of the emergency assessment collected in a
  263  particular year shall be a uniform percentage of that year’s
  264  direct written premium for subject lines of business and all
  265  accounts of the corporation, excluding National Flood Insurance
  266  Program policy premiums, as annually determined by the board and
  267  verified by the office. The office shall verify the arithmetic
  268  calculations involved in the board’s determination within 30
  269  days after receipt of the information on which the determination
  270  was based. Notwithstanding any other provision of law, the
  271  corporation and each assessable insurer that writes subject
  272  lines of business shall collect emergency assessments from its
  273  policyholders without such obligation being affected by any
  274  credit, limitation, exemption, or deferment. Emergency
  275  assessments levied by the corporation on assessable insureds
  276  shall be collected by the surplus lines agent at the time the
  277  surplus lines agent collects the surplus lines tax required by
  278  s. 626.932 and shall be paid to the Florida Surplus Lines
  279  Service Office at the time the surplus lines agent pays the
  280  surplus lines tax to the Florida Surplus Lines Service Office.
  281  The emergency assessments so collected shall be transferred
  282  directly to the corporation on a periodic basis as determined by
  283  the corporation and shall be held by the corporation solely in
  284  the applicable account. The aggregate amount of emergency
  285  assessments levied for an account under this sub-subparagraph in
  286  any calendar year may, at the discretion of the board of
  287  governors, be less than but may not exceed the greater of 10
  288  percent of the amount needed to cover the deficit, plus
  289  interest, fees, commissions, required reserves, and other costs
  290  associated with financing of the original deficit, or 10 percent
  291  of the aggregate statewide direct written premium for subject
  292  lines of business and for all accounts of the corporation for
  293  the prior year, plus interest, fees, commissions, required
  294  reserves, and other costs associated with financing the deficit.
  295         e. The corporation may pledge the proceeds of assessments,
  296  projected recoveries from the Florida Hurricane Catastrophe
  297  Fund, other insurance and reinsurance recoverables, policyholder
  298  surcharges and other surcharges, and other funds available to
  299  the corporation as the source of revenue for and to secure bonds
  300  issued under paragraph (p), bonds or other indebtedness issued
  301  under subparagraph (c)3., or lines of credit or other financing
  302  mechanisms issued or created under this subsection, or to retire
  303  any other debt incurred as a result of deficits or events giving
  304  rise to deficits, or in any other way that the board determines
  305  will efficiently recover such deficits. The purpose of the lines
  306  of credit or other financing mechanisms is to provide additional
  307  resources to assist the corporation in covering claims and
  308  expenses attributable to a catastrophe. As used in this
  309  subsection, the term “assessments” includes regular assessments
  310  under sub-subparagraph a., sub-subparagraph b., or subparagraph
  311  (p)1. and emergency assessments under sub-subparagraph d.
  312  Emergency assessments collected under sub-subparagraph d. are
  313  not part of an insurer’s rates, are not premium, and are not
  314  subject to premium tax, fees, or commissions; however, failure
  315  to pay the emergency assessment shall be treated as failure to
  316  pay premium. The emergency assessments under sub-subparagraph d.
  317  shall continue as long as any bonds issued or other indebtedness
  318  incurred with respect to a deficit for which the assessment was
  319  imposed remain outstanding, unless adequate provision has been
  320  made for the payment of such bonds or other indebtedness
  321  pursuant to the documents governing such bonds or other
  322  indebtedness.
  323         f. As used in this subsection for purposes of any deficit
  324  incurred on or after January 25, 2007, the term “subject lines
  325  of business” means insurance written by assessable insurers or
  326  procured by assessable insureds for all property and casualty
  327  lines of business in this state, but not including workers’
  328  compensation or medical malpractice. As used in the sub
  329  subparagraph, the term “property and casualty lines of business”
  330  includes all lines of business identified on Form 2, Exhibit of
  331  Premiums and Losses, in the annual statement required of
  332  authorized insurers by s. 624.424 and any rule adopted under
  333  this section, except for those lines identified as accident and
  334  health insurance and except for policies written under the
  335  National Flood Insurance Program or the Federal Crop Insurance
  336  Program. For purposes of this sub-subparagraph, the term
  337  “workers’ compensation” includes both workers’ compensation
  338  insurance and excess workers’ compensation insurance.
  339         g. The Florida Surplus Lines Service Office shall determine
  340  annually the aggregate statewide written premium in subject
  341  lines of business procured by assessable insureds and shall
  342  report that information to the corporation in a form and at a
  343  time the corporation specifies to ensure that the corporation
  344  can meet the requirements of this subsection and the
  345  corporation’s financing obligations.
  346         h. The Florida Surplus Lines Service Office shall verify
  347  the proper application by surplus lines agents of assessment
  348  percentages for regular assessments and emergency assessments
  349  levied under this subparagraph on assessable insureds and shall
  350  assist the corporation in ensuring the accurate, timely
  351  collection and payment of assessments by surplus lines agents as
  352  required by the corporation.
  353         i.(I) If a deficit is incurred in any account in 2008 or
  354  thereafter, the board of governors shall levy a Citizens
  355  policyholder surcharge against all policyholders of the
  356  corporation.
  357         (II) The policyholder’s liability for the Citizens
  358  policyholder surcharge attaches on the date of the order levying
  359  the surcharge or upon the initial issuance of a policy within
  360  the first 12 months after the date of the order. The Citizens
  361  policyholder surcharge is payable upon cancellation or
  362  termination of the policy, upon renewal of the policy, or upon
  363  issuance of a new policy within the first 12 months after the
  364  date of the levy.
  365         (III) The Citizens policyholder surcharge for a 12-month
  366  period, which shall be levied collected at the time of issuance
  367  or renewal of a policy, as a uniform percentage of the premium
  368  for the policy of up to 15 percent of such premium, which funds
  369  shall be used to offset the deficit.
  370         (IV) The corporation may not levy any regular assessments
  371  under paragraph (q) pursuant to sub-subparagraph a. or sub
  372  subparagraph b. with respect to a particular year’s deficit
  373  until the corporation has first levied a Citizens policyholder
  374  surcharge under this sub-subparagraph in the full amount
  375  authorized by this sub-subparagraph.
  376         (V) Citizens policyholder surcharges under this sub
  377  subparagraph are not considered premium and are not subject to
  378  commissions, fees, or premium taxes. However, failure to pay
  379  such surcharges shall be treated as failure to pay premium.
  380         j. If the amount of any assessments or surcharges collected
  381  from corporation policyholders, assessable insurers or their
  382  policyholders, or assessable insureds exceeds the amount of the
  383  deficits, such excess amounts shall be remitted to and retained
  384  by the corporation in a reserve to be used by the corporation,
  385  as determined by the board of governors and approved by the
  386  office, to pay claims or reduce any past, present, or future
  387  plan-year deficits or to reduce outstanding debt.
  388         (c) The plan of operation of the corporation:
  389         1. Must provide for adoption of residential property and
  390  casualty insurance policy forms and commercial residential and
  391  nonresidential property insurance forms, which forms must be
  392  approved by the office prior to use. The corporation shall adopt
  393  the following policy forms:
  394         a. Standard personal lines policy forms that are
  395  comprehensive multiperil policies providing full coverage of a
  396  residential property equivalent to the coverage provided in the
  397  private insurance market under an HO-3, HO-4, or HO-6 policy.
  398         b. Basic personal lines policy forms that are policies
  399  similar to an HO-8 policy or a dwelling fire policy that provide
  400  coverage meeting the requirements of the secondary mortgage
  401  market, but which coverage is more limited than the coverage
  402  under a standard policy.
  403         c. Commercial lines residential and nonresidential policy
  404  forms that are generally similar to the basic perils of full
  405  coverage obtainable for commercial residential structures and
  406  commercial nonresidential structures in the admitted voluntary
  407  market.
  408         d. Personal lines and commercial lines residential property
  409  insurance forms that cover the peril of wind only. The forms are
  410  applicable only to residential properties located in areas
  411  eligible for coverage under the high-risk account referred to in
  412  sub-subparagraph (b)2.a.
  413         e. Commercial lines nonresidential property insurance forms
  414  that cover the peril of wind only. The forms are applicable only
  415  to nonresidential properties located in areas eligible for
  416  coverage under the high-risk account referred to in sub
  417  subparagraph (b)2.a.
  418         f. The corporation may adopt variations of the policy forms
  419  listed in sub-subparagraphs a.-e. that contain more restrictive
  420  coverage.
  421         2.a. Must provide that the corporation adopt a program in
  422  which the corporation and authorized insurers enter into quota
  423  share primary insurance agreements for hurricane coverage, as
  424  defined in s. 627.4025(2)(a), for eligible risks, and adopt
  425  property insurance forms for eligible risks which cover the
  426  peril of wind only. As used in this subsection, the term:
  427         (I) “Quota share primary insurance” means an arrangement in
  428  which the primary hurricane coverage of an eligible risk is
  429  provided in specified percentages by the corporation and an
  430  authorized insurer. The corporation and authorized insurer are
  431  each solely responsible for a specified percentage of hurricane
  432  coverage of an eligible risk as set forth in a quota share
  433  primary insurance agreement between the corporation and an
  434  authorized insurer and the insurance contract. The
  435  responsibility of the corporation or authorized insurer to pay
  436  its specified percentage of hurricane losses of an eligible
  437  risk, as set forth in the quota share primary insurance
  438  agreement, may not be altered by the inability of the other
  439  party to the agreement to pay its specified percentage of
  440  hurricane losses. Eligible risks that are provided hurricane
  441  coverage through a quota share primary insurance arrangement
  442  must be provided policy forms that set forth the obligations of
  443  the corporation and authorized insurer under the arrangement,
  444  clearly specify the percentages of quota share primary insurance
  445  provided by the corporation and authorized insurer, and
  446  conspicuously and clearly state that neither the authorized
  447  insurer nor the corporation may be held responsible beyond its
  448  specified percentage of coverage of hurricane losses.
  449         (II) “Eligible risks” means personal lines residential and
  450  commercial lines residential risks that meet the underwriting
  451  criteria of the corporation and are located in areas that were
  452  eligible for coverage by the Florida Windstorm Underwriting
  453  Association on January 1, 2002.
  454         b. The corporation may enter into quota share primary
  455  insurance agreements with authorized insurers at corporation
  456  coverage levels of 90 percent and 50 percent.
  457         c. If the corporation determines that additional coverage
  458  levels are necessary to maximize participation in quota share
  459  primary insurance agreements by authorized insurers, the
  460  corporation may establish additional coverage levels. However,
  461  the corporation’s quota share primary insurance coverage level
  462  may not exceed 90 percent.
  463         d. Any quota share primary insurance agreement entered into
  464  between an authorized insurer and the corporation must provide
  465  for a uniform specified percentage of coverage of hurricane
  466  losses, by county or territory as set forth by the corporation
  467  board, for all eligible risks of the authorized insurer covered
  468  under the quota share primary insurance agreement.
  469         e. Any quota share primary insurance agreement entered into
  470  between an authorized insurer and the corporation is subject to
  471  review and approval by the office. However, such agreement shall
  472  be authorized only as to insurance contracts entered into
  473  between an authorized insurer and an insured who is already
  474  insured by the corporation for wind coverage.
  475         f. For all eligible risks covered under quota share primary
  476  insurance agreements, the exposure and coverage levels for both
  477  the corporation and authorized insurers shall be reported by the
  478  corporation to the Florida Hurricane Catastrophe Fund. For all
  479  policies of eligible risks covered under quota share primary
  480  insurance agreements, the corporation and the authorized insurer
  481  shall maintain complete and accurate records for the purpose of
  482  exposure and loss reimbursement audits as required by Florida
  483  Hurricane Catastrophe Fund rules. The corporation and the
  484  authorized insurer shall each maintain duplicate copies of
  485  policy declaration pages and supporting claims documents.
  486         g. The corporation board shall establish in its plan of
  487  operation standards for quota share agreements which ensure that
  488  there is no discriminatory application among insurers as to the
  489  terms of quota share agreements, pricing of quota share
  490  agreements, incentive provisions if any, and consideration paid
  491  for servicing policies or adjusting claims.
  492         h. The quota share primary insurance agreement between the
  493  corporation and an authorized insurer must set forth the
  494  specific terms under which coverage is provided, including, but
  495  not limited to, the sale and servicing of policies issued under
  496  the agreement by the insurance agent of the authorized insurer
  497  producing the business, the reporting of information concerning
  498  eligible risks, the payment of premium to the corporation, and
  499  arrangements for the adjustment and payment of hurricane claims
  500  incurred on eligible risks by the claims adjuster and personnel
  501  of the authorized insurer. Entering into a quota sharing
  502  insurance agreement between the corporation and an authorized
  503  insurer shall be voluntary and at the discretion of the
  504  authorized insurer.
  505         3. May provide that the corporation may employ or otherwise
  506  contract with individuals or other entities to provide
  507  administrative or professional services that may be appropriate
  508  to effectuate the plan. The corporation shall have the power to
  509  borrow funds, by issuing bonds or by incurring other
  510  indebtedness, and shall have other powers reasonably necessary
  511  to effectuate the requirements of this subsection, including,
  512  without limitation, the power to issue bonds and incur other
  513  indebtedness in order to refinance outstanding bonds or other
  514  indebtedness. The corporation may, but is not required to, seek
  515  judicial validation of its bonds or other indebtedness under
  516  chapter 75. The corporation may issue bonds or incur other
  517  indebtedness, or have bonds issued on its behalf by a unit of
  518  local government pursuant to subparagraph (p)2., in the absence
  519  of a hurricane or other weather-related event, upon a
  520  determination by the corporation, subject to approval by the
  521  office, that such action would enable it to efficiently meet the
  522  financial obligations of the corporation and that such
  523  financings are reasonably necessary to effectuate the
  524  requirements of this subsection. The corporation is authorized
  525  to take all actions needed to facilitate tax-free status for any
  526  such bonds or indebtedness, including formation of trusts or
  527  other affiliated entities. The corporation shall have the
  528  authority to pledge assessments, projected recoveries from the
  529  Florida Hurricane Catastrophe Fund, other reinsurance
  530  recoverables, market equalization and other surcharges, and
  531  other funds available to the corporation as security for bonds
  532  or other indebtedness. In recognition of s. 10, Art. I of the
  533  State Constitution, prohibiting the impairment of obligations of
  534  contracts, it is the intent of the Legislature that no action be
  535  taken whose purpose is to impair any bond indenture or financing
  536  agreement or any revenue source committed by contract to such
  537  bond or other indebtedness.
  538         4.a. Must require that the corporation operate subject to
  539  the supervision and approval of a board of governors consisting
  540  of eight individuals who are residents of this state, from
  541  different geographical areas of this state. The Governor, the
  542  Chief Financial Officer, the President of the Senate, and the
  543  Speaker of the House of Representatives shall each appoint two
  544  members of the board. At least one of the two members appointed
  545  by each appointing officer must have demonstrated expertise in
  546  insurance. The Chief Financial Officer shall designate one of
  547  the appointees as chair. All board members serve at the pleasure
  548  of the appointing officer. All members of the board of governors
  549  are subject to removal at will by the officers who appointed
  550  them. All board members, including the chair, must be appointed
  551  to serve for 3-year terms beginning annually on a date
  552  designated by the plan. However, for the first term beginning on
  553  or after July 1, 2009, each appointing officer shall appoint one
  554  member of the board for a 2-year term and one member for a 3
  555  year term. Any board vacancy shall be filled for the unexpired
  556  term by the appointing officer. The Chief Financial Officer
  557  shall appoint a technical advisory group to provide information
  558  and advice to the board of governors in connection with the
  559  board’s duties under this subsection. The executive director and
  560  senior managers of the corporation shall be engaged by the board
  561  and serve at the pleasure of the board. Any executive director
  562  appointed on or after July 1, 2006, is subject to confirmation
  563  by the Senate. The executive director is responsible for
  564  employing other staff as the corporation may require, subject to
  565  review and concurrence by the board.
  566         b. The board shall create a Market Accountability Advisory
  567  Committee to assist the corporation in developing awareness of
  568  its rates and its customer and agent service levels in
  569  relationship to the voluntary market insurers writing similar
  570  coverage. The members of the advisory committee shall consist of
  571  the following 11 persons, one of whom must be elected chair by
  572  the members of the committee: four representatives, one
  573  appointed by the Florida Association of Insurance Agents, one by
  574  the Florida Association of Insurance and Financial Advisors, one
  575  by the Professional Insurance Agents of Florida, and one by the
  576  Latin American Association of Insurance Agencies; three
  577  representatives appointed by the insurers with the three highest
  578  voluntary market share of residential property insurance
  579  business in the state; one representative from the Office of
  580  Insurance Regulation; one consumer appointed by the board who is
  581  insured by the corporation at the time of appointment to the
  582  committee; one representative appointed by the Florida
  583  Association of Realtors; and one representative appointed by the
  584  Florida Bankers Association. All members must serve for 3-year
  585  terms and may serve for consecutive terms. The committee shall
  586  report to the corporation at each board meeting on insurance
  587  market issues which may include rates and rate competition with
  588  the voluntary market; service, including policy issuance, claims
  589  processing, and general responsiveness to policyholders,
  590  applicants, and agents; and matters relating to depopulation.
  591         5. Must provide a procedure for determining the eligibility
  592  of a risk for coverage, as follows:
  593         a. Subject to the provisions of s. 627.3517, with respect
  594  to personal lines residential risks, if the risk is offered
  595  coverage from an authorized insurer at the insurer’s approved
  596  rate under either a standard policy including wind coverage or,
  597  if consistent with the insurer’s underwriting rules as filed
  598  with the office, a basic policy including wind coverage, for a
  599  new application to the corporation for coverage, the risk is not
  600  eligible for any policy issued by the corporation unless the
  601  premium for coverage from the authorized insurer is more than 15
  602  percent greater than the premium for comparable coverage from
  603  the corporation. If the risk is not able to obtain any such
  604  offer, the risk is eligible for either a standard policy
  605  including wind coverage or a basic policy including wind
  606  coverage issued by the corporation; however, if the risk could
  607  not be insured under a standard policy including wind coverage
  608  regardless of market conditions, the risk shall be eligible for
  609  a basic policy including wind coverage unless rejected under
  610  subparagraph 8. However, with regard to a policyholder of the
  611  corporation or a policyholder removed from the corporation
  612  through an assumption agreement until the end of the assumption
  613  period, the policyholder remains eligible for coverage from the
  614  corporation regardless of any offer of coverage from an
  615  authorized insurer or surplus lines insurer. The corporation
  616  shall determine the type of policy to be provided on the basis
  617  of objective standards specified in the underwriting manual and
  618  based on generally accepted underwriting practices.
  619         (I) If the risk accepts an offer of coverage through the
  620  market assistance plan or an offer of coverage through a
  621  mechanism established by the corporation before a policy is
  622  issued to the risk by the corporation or during the first 30
  623  days of coverage by the corporation, and the producing agent who
  624  submitted the application to the plan or to the corporation is
  625  not currently appointed by the insurer, the insurer shall:
  626         (A) Pay to the producing agent of record of the policy, for
  627  the first year, an amount that is the greater of the insurer’s
  628  usual and customary commission for the type of policy written or
  629  a fee equal to the usual and customary commission of the
  630  corporation; or
  631         (B) Offer to allow the producing agent of record of the
  632  policy to continue servicing the policy for a period of not less
  633  than 1 year and offer to pay the agent the greater of the
  634  insurer’s or the corporation’s usual and customary commission
  635  for the type of policy written.
  636  
  637  If the producing agent is unwilling or unable to accept
  638  appointment, the new insurer shall pay the agent in accordance
  639  with sub-sub-sub-subparagraph (A).
  640         (II) When the corporation enters into a contractual
  641  agreement for a take-out plan, the producing agent of record of
  642  the corporation policy is entitled to retain any unearned
  643  commission on the policy, and the insurer shall:
  644         (A) Pay to the producing agent of record of the corporation
  645  policy, for the first year, an amount that is the greater of the
  646  insurer’s usual and customary commission for the type of policy
  647  written or a fee equal to the usual and customary commission of
  648  the corporation; or
  649         (B) Offer to allow the producing agent of record of the
  650  corporation policy to continue servicing the policy for a period
  651  of not less than 1 year and offer to pay the agent the greater
  652  of the insurer’s or the corporation’s usual and customary
  653  commission for the type of policy written.
  654  
  655  If the producing agent is unwilling or unable to accept
  656  appointment, the new insurer shall pay the agent in accordance
  657  with sub-sub-sub-subparagraph (A).
  658         b. With respect to commercial lines residential risks, for
  659  a new application to the corporation for coverage, if the risk
  660  is offered coverage under a policy including wind coverage from
  661  an authorized insurer at its approved rate, the risk is not
  662  eligible for any policy issued by the corporation unless the
  663  premium for coverage from the authorized insurer is more than 15
  664  percent greater than the premium for comparable coverage from
  665  the corporation. If the risk is not able to obtain any such
  666  offer, the risk is eligible for a policy including wind coverage
  667  issued by the corporation. However, with regard to a
  668  policyholder of the corporation or a policyholder removed from
  669  the corporation through an assumption agreement until the end of
  670  the assumption period, the policyholder remains eligible for
  671  coverage from the corporation regardless of any offer of
  672  coverage from an authorized insurer or surplus lines insurer.
  673         (I) If the risk accepts an offer of coverage through the
  674  market assistance plan or an offer of coverage through a
  675  mechanism established by the corporation before a policy is
  676  issued to the risk by the corporation or during the first 30
  677  days of coverage by the corporation, and the producing agent who
  678  submitted the application to the plan or the corporation is not
  679  currently appointed by the insurer, the insurer shall:
  680         (A) Pay to the producing agent of record of the policy, for
  681  the first year, an amount that is the greater of the insurer’s
  682  usual and customary commission for the type of policy written or
  683  a fee equal to the usual and customary commission of the
  684  corporation; or
  685         (B) Offer to allow the producing agent of record of the
  686  policy to continue servicing the policy for a period of not less
  687  than 1 year and offer to pay the agent the greater of the
  688  insurer’s or the corporation’s usual and customary commission
  689  for the type of policy written.
  690  
  691  If the producing agent is unwilling or unable to accept
  692  appointment, the new insurer shall pay the agent in accordance
  693  with sub-sub-sub-subparagraph (A).
  694         (II) When the corporation enters into a contractual
  695  agreement for a take-out plan, the producing agent of record of
  696  the corporation policy is entitled to retain any unearned
  697  commission on the policy, and the insurer shall:
  698         (A) Pay to the producing agent of record of the corporation
  699  policy, for the first year, an amount that is the greater of the
  700  insurer’s usual and customary commission for the type of policy
  701  written or a fee equal to the usual and customary commission of
  702  the corporation; or
  703         (B) Offer to allow the producing agent of record of the
  704  corporation policy to continue servicing the policy for a period
  705  of not less than 1 year and offer to pay the agent the greater
  706  of the insurer’s or the corporation’s usual and customary
  707  commission for the type of policy written.
  708  
  709  If the producing agent is unwilling or unable to accept
  710  appointment, the new insurer shall pay the agent in accordance
  711  with sub-sub-sub-subparagraph (A).
  712         c. For purposes of determining comparable coverage under
  713  sub-subparagraphs a. and b., the comparison shall be based on
  714  those forms and coverages that are reasonably comparable. The
  715  corporation may rely on a determination of comparable coverage
  716  and premium made by the producing agent who submits the
  717  application to the corporation, made in the agent’s capacity as
  718  the corporation’s agent. A comparison may be made solely of the
  719  premium with respect to the main building or structure only on
  720  the following basis: the same coverage A or other building
  721  limits; the same percentage hurricane deductible that applies on
  722  an annual basis or that applies to each hurricane for commercial
  723  residential property; the same percentage of ordinance and law
  724  coverage, if the same limit is offered by both the corporation
  725  and the authorized insurer; the same mitigation credits, to the
  726  extent the same types of credits are offered both by the
  727  corporation and the authorized insurer; the same method for loss
  728  payment, such as replacement cost or actual cash value, if the
  729  same method is offered both by the corporation and the
  730  authorized insurer in accordance with underwriting rules; and
  731  any other form or coverage that is reasonably comparable as
  732  determined by the board. If an application is submitted to the
  733  corporation for wind-only coverage in the high-risk account, the
  734  premium for the corporation’s wind-only policy plus the premium
  735  for the ex-wind policy that is offered by an authorized insurer
  736  to the applicant shall be compared to the premium for multiperil
  737  coverage offered by an authorized insurer, subject to the
  738  standards for comparison specified in this subparagraph. If the
  739  corporation or the applicant requests from the authorized
  740  insurer a breakdown of the premium of the offer by types of
  741  coverage so that a comparison may be made by the corporation or
  742  its agent and the authorized insurer refuses or is unable to
  743  provide such information, the corporation may treat the offer as
  744  not being an offer of coverage from an authorized insurer at the
  745  insurer’s approved rate.
  746         6. Must include rules for classifications of risks and
  747  rates therefor.
  748         7. Must provide that if premium and investment income for
  749  an account attributable to a particular calendar year are in
  750  excess of projected losses and expenses for the account
  751  attributable to that year, such excess shall be held in surplus
  752  in the account. Such surplus shall be available to defray
  753  deficits in that account as to future years and shall be used
  754  for that purpose prior to assessing assessable insurers and
  755  assessable insureds as to any calendar year.
  756         8. Must provide objective criteria and procedures to be
  757  uniformly applied for all applicants in determining whether an
  758  individual risk is so hazardous as to be uninsurable. In making
  759  this determination and in establishing the criteria and
  760  procedures, the following shall be considered:
  761         a. Whether the likelihood of a loss for the individual risk
  762  is substantially higher than for other risks of the same class;
  763  and
  764         b. Whether the uncertainty associated with the individual
  765  risk is such that an appropriate premium cannot be determined.
  766  
  767  The acceptance or rejection of a risk by the corporation shall
  768  be construed as the private placement of insurance, and the
  769  provisions of chapter 120 shall not apply.
  770         9. Must provide that the corporation shall make its best
  771  efforts to procure catastrophe reinsurance at reasonable rates,
  772  to cover its projected 100-year probable maximum loss as
  773  determined by the board of governors.
  774         10. The policies issued by the corporation must provide
  775  that, if the corporation or the market assistance plan obtains
  776  an offer from an authorized insurer to cover the risk at its
  777  approved rates, the risk is no longer eligible for renewal
  778  through the corporation, except as otherwise provided in this
  779  subsection.
  780         11. Corporation policies and applications must include a
  781  notice that the corporation policy could, under this section, be
  782  replaced with a policy issued by an authorized insurer that does
  783  not provide coverage identical to the coverage provided by the
  784  corporation. The notice shall also specify that acceptance of
  785  corporation coverage creates a conclusive presumption that the
  786  applicant or policyholder is aware of this potential.
  787         12. May establish, subject to approval by the office,
  788  different eligibility requirements and operational procedures
  789  for any line or type of coverage for any specified county or
  790  area if the board determines that such changes to the
  791  eligibility requirements and operational procedures are
  792  justified due to the voluntary market being sufficiently stable
  793  and competitive in such area or for such line or type of
  794  coverage and that consumers who, in good faith, are unable to
  795  obtain insurance through the voluntary market through ordinary
  796  methods would continue to have access to coverage from the
  797  corporation. When coverage is sought in connection with a real
  798  property transfer, such requirements and procedures shall not
  799  provide for an effective date of coverage later than the date of
  800  the closing of the transfer as established by the transferor,
  801  the transferee, and, if applicable, the lender.
  802         13. Must provide that, with respect to the high-risk
  803  account, any assessable insurer with a surplus as to
  804  policyholders of $25 million or less writing 25 percent or more
  805  of its total countrywide property insurance premiums in this
  806  state may petition the office, within the first 90 days of each
  807  calendar year, to qualify as a limited apportionment company. A
  808  regular assessment levied by the corporation on a limited
  809  apportionment company for a deficit incurred by the corporation
  810  for the high-risk account in 2006 or thereafter may be paid to
  811  the corporation on a monthly basis as the assessments are
  812  collected by the limited apportionment company from its insureds
  813  pursuant to s. 627.3512, but the regular assessment must be paid
  814  in full within 12 months after being levied by the corporation.
  815  A limited apportionment company shall collect from its
  816  policyholders any emergency assessment imposed under sub
  817  subparagraph (b)3.d. The plan shall provide that, if the office
  818  determines that any regular assessment will result in an
  819  impairment of the surplus of a limited apportionment company,
  820  the office may direct that all or part of such assessment be
  821  deferred as provided in subparagraph (p)4. However, there shall
  822  be no limitation or deferment of an emergency assessment to be
  823  collected from policyholders under sub-subparagraph (b)3.d.
  824         14. Must provide that the corporation appoint as its
  825  licensed agents only those agents who also hold an appointment
  826  as defined in s. 626.015(3) with an insurer who at the time of
  827  the agent’s initial appointment by the corporation is authorized
  828  to write and is actually writing personal lines residential
  829  property coverage, commercial residential property coverage, or
  830  commercial nonresidential property coverage within the state.
  831         15. Must provide, by July 1, 2007, a premium payment plan
  832  option to its policyholders which allows at a minimum for
  833  quarterly and semiannual payment of premiums. A monthly payment
  834  plan may, but is not required to, be offered.
  835         16. Must limit coverage on mobile homes or manufactured
  836  homes built prior to 1994 to actual cash value of the dwelling
  837  rather than replacement costs of the dwelling.
  838         17. May provide such limits of coverage as the board
  839  determines, consistent with the requirements of this subsection.
  840         18. May require commercial property to meet specified
  841  hurricane mitigation construction features as a condition of
  842  eligibility for coverage.
  843         19.a. Shall require the agent to obtain from any applicant
  844  for coverage the following acknowledgement, signed by the
  845  applicant, and shall require the agent of record to obtain the
  846  following acknowledgment from each corporation policyholder,
  847  signed by the policyholder, prior to the policy’s first renewal
  848  after the effective date of this act:
  849  
  850        ACKNOWLEDGEMENT OF POTENTIAL SURCHARGE AND ASSESSMENT      
  851                             LIABILITY:                            
  852         1. I UNDERSTAND, AS A CITIZENS PROPERTY INSURANCE
  853         CORPORATION POLICYHOLDER, THAT IF THE CORPORATION
  854         SUSTAINS A DEFICIT AS A RESULT OF HURRICANE LOSSES OR
  855         FOR ANY OTHER REASON, MY POLICY COULD BE SUBJECT TO
  856         CITIZENS POLICYHOLDER SURCHARGES, WHICH WOULD BE DUE
  857         AND PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION
  858         OF THE POLICY, AND THAT THE SURCHARGES COULD BE AS
  859         HIGH AS 15 PERCENT OF MY PREMIUM FOR DEFICITS IN EACH
  860         OF THREE CITIZENS ACCOUNTS, OR A DIFFERENT AMOUNT AS
  861         ESTABLISHED BY THE FLORIDA LEGISLATURE.
  862         2. I ALSO UNDERSTAND THAT I MAY BE SUBJECT TO
  863         EMERGENCY ASSESSMENTS TO THE SAME EXTENT AS
  864         POLICYHOLDERS OF OTHER INSURANCE COMPANIES.
  865  
  866         b. The corporation shall permanently maintain a signed copy
  867  of the signed acknowledgement required by this subparagraph, and
  868  the agent may also retain a copy.
  869         c. The signed acknowledgement form creates a conclusive
  870  presumption that the policyholder understood and accepted his or
  871  her potential surcharge and assessment liability as a Citizens
  872  policyholder.
  873         Section 3. Section 627.7031, Florida Statutes, is created
  874  to read:
  875         627.7031 Residential property insurance option.—
  876         (1) An insurer holding a certificate of authority to write
  877  property insurance in this state may offer or renew policies at
  878  rates established in accordance with s. 627.062(2)(l), subject
  879  to all of the requirements and prohibitions of this section.
  880         (2) An insurer offering or renewing policies at rates
  881  established in accordance with s. 627.062(2)(l) may not purchase
  882  coverage from the Florida Hurricane Catastrophe Fund under the
  883  temporary increase in coverage limit option under s.
  884  215.555(17).
  885         (3)(a) Before the effective date of a newly issued or
  886  renewal policy at rates established in accordance with s.
  887  627.062(2)(l), the applicant or insured must be given the
  888  following notice, printed in at least 12-point boldfaced type:
  889  
  890         THE RATE FOR THIS POLICY IS NOT SUBJECT TO FULL RATE
  891  REGULATION BY THE FLORIDA OFFICE OF INSURANCE REGULATION AND MAY
  892  BE HIGHER THAN RATES APPROVED BY THAT OFFICE. A RESIDENTIAL
  893  PROPERTY POLICY SUBJECT TO FULL RATE REGULATION REQUIREMENTS MAY
  894  BE AVAILABLE FROM THIS INSURER, ANOTHER INSURER, OR CITIZENS
  895  PROPERTY INSURANCE CORPORATION. PLEASE DISCUSS YOUR POLICY
  896  OPTIONS WITH AN INSURANCE AGENT WHO CAN PROVIDE A CITIZENS
  897  QUOTE. YOU MAY WISH TO VIEW THE OFFICE OF INSURANCE REGULATION’S
  898  WEBSITE AT WWW.SHOPANDCOMPARERATES.COM FOR MORE INFORMATION
  899  ABOUT CHOICES AVAILABLE TO YOU.
  900  
  901         (b) For policies renewed at a rate established in
  902  accordance with s. 627.062(2)(l), the notice described in
  903  paragraph (a) must be provided in writing at the same time as
  904  the renewal notice on a document separate from the renewal
  905  notice, but may be contained within the same mailing as the
  906  renewal notice.
  907         (4) Before the effective date of a newly issued policy at
  908  rates established in accordance with s. 627.062(2)(l), or before
  909  the effective date of the first renewal at rates established in
  910  accordance with s. 627.062(2)(l) of a policy originally issued
  911  before the effective date of this section, the applicant or
  912  insured must:
  913         (a) Be provided or offered, for comparison purposes, an
  914  estimate of the premium for a policy from Citizens Property
  915  Insurance Corporation reflecting substantially similar
  916  coverages, limits, and deductibles to the extent available.
  917         (b) Provide the insurer or agent with a signed copy of the
  918  following acknowledgement form, which must be retained by the
  919  insurer or agent for at least 3 years. If the acknowledgement
  920  form is signed by the insured or if the insured remits payment
  921  in the amount of the rate established in accordance with s.
  922  627.062(2)(l) after being mailed or otherwise provided the
  923  acknowledgement form specified in this paragraph, and after
  924  being mailed, otherwise provided, or offered the comparison
  925  specified in paragraph (a), an insurer renewing a policy at such
  926  rate shall be deemed to comply with this section, and it is
  927  presumed that the insured has been informed and understands the
  928  information contained in the comparison and acknowledgement
  929  forms:
  930  
  931                           ACKNOWLEDGEMENT                         
  932         1. I HAVE REVIEWED THE REQUIRED DISCLOSURES AND THE
  933  REQUIRED PREMIUM COMPARISON.
  934         2. I UNDERSTAND THAT THE RATE FOR THIS RESIDENTIAL PROPERTY
  935  INSURANCE POLICY IS NOT SUBJECT TO FULL RATE REGULATION BY THE
  936  FLORIDA OFFICE OF INSURANCE REGULATION AND MAY BE HIGHER THAN
  937  RATES APPROVED BY THAT OFFICE.
  938         3. I UNDERSTAND THAT A RESIDENTIAL PROPERTY INSURANCE
  939  POLICY SUBJECT TO FULL RATE REGULATION REQUIREMENTS MAY BE
  940  AVAILABLE FROM CITIZENS PROPERTY INSURANCE CORPORATION.
  941         4. I UNDERSTAND THAT THE FLORIDA OFFICE OF INSURANCE
  942  REGULATION’S WEBSITE WWW.SHOPANDCOMPARERATES.COM CONTAINS
  943  RESIDENTIAL PROPERTY INSURANCE RATE COMPARISON INFORMATION.
  944         5. I UNDERSTAND THAT IF CITIZENS PROPERTY INSURANCE
  945  CORPORATION INCURS A DEFICIT BECAUSE OF HURRICANE LOSSES OR
  946  OTHER LOSSES, I MAY BE REQUIRED TO PAY AN ASSESSMENT BASED UPON
  947  THE PREMIUM FOR THIS POLICY AND THAT A POLICYHOLDER OF CITIZENS
  948  PROPERTY INSURANCE CORPORATION MAY BE REQUIRED TO PAY A
  949  DIFFERENT ASSESSMENT.
  950  
  951         (5) The following types of residential property insurance
  952  policies are not eligible for rates established in accordance
  953  with s. 627.062(2)(l) and are not subject to the other
  954  provisions of this section:
  955         (a) Residential property insurance policies that exclude
  956  coverage for the perils of windstorm or hurricane.
  957         (b) Residential property insurance policies that are
  958  subject to a consent decree, agreement, understanding, or other
  959  arrangement between the insurer and the office relating to rates
  960  or premiums for policies removed from Citizens Property
  961  Insurance Corporation.
  962         (6) Notwithstanding s. 627.4133, an insurer that has issued
  963  a policy under this section shall provide the named insured
  964  written notice of nonrenewal at least 180 days before the
  965  effective date of the nonrenewal as to subsequent nonrenewals.
  966  However, this subsection does not prohibit an insurer from
  967  cancelling a policy as permitted under s. 627.4133. The offer of
  968  a policy at rates authorized by this section constitutes an
  969  offer to renew the policy at the rates specified in the offer
  970  and does not constitute a nonrenewal.
  971         Section 4. This act shall take effect January 1, 2011.

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