November 27, 2020
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       Florida Senate - 2010                             CS for SB 1594
       
       
       
       By the Committee on General Government Appropriations; and
       Senator Baker
       
       
       
       601-03211-10                                          20101594c1
    1                        A bill to be entitled                      
    2         An act relating to the Florida Hurricane Catastrophe
    3         Fund; amending s. 215.555, F.S., relating to emergency
    4         assessments to fund the obligations, costs, and
    5         expenses of the Florida Hurricane Catastrophe Fund;
    6         delaying the repeal of an exemption from such
    7         assessments which is provided for medical malpractice
    8         insurance premiums; providing an effective date.
    9  
   10  Be It Enacted by the Legislature of the State of Florida:
   11  
   12         Section 1. Paragraph (b) of subsection (6) of section
   13  215.555, Florida Statutes, is amended to read:
   14         215.555 Florida Hurricane Catastrophe Fund.—
   15         (6) REVENUE BONDS.—
   16         (b) Emergency assessments.—
   17         1. If the board determines that the amount of revenue
   18  produced under subsection (5) is insufficient to fund the
   19  obligations, costs, and expenses of the fund and the
   20  corporation, including repayment of revenue bonds and that
   21  portion of the debt service coverage not met by reimbursement
   22  premiums, the board shall direct the Office of Insurance
   23  Regulation to levy, by order, an emergency assessment on direct
   24  premiums for all property and casualty lines of business in this
   25  state, including property and casualty business of surplus lines
   26  insurers regulated under part VIII of chapter 626, but not
   27  including any workers’ compensation premiums or medical
   28  malpractice premiums. As used in this subsection, the term
   29  “property and casualty business” includes all lines of business
   30  identified on Form 2, Exhibit of Premiums and Losses, in the
   31  annual statement required of authorized insurers by s. 624.424
   32  and any rule adopted under this section, except for those lines
   33  identified as accident and health insurance and except for
   34  policies written under the National Flood Insurance Program. The
   35  assessment shall be specified as a percentage of direct written
   36  premium and is subject to annual adjustments by the board in
   37  order to meet debt obligations. The same percentage shall apply
   38  to all policies in lines of business subject to the assessment
   39  issued or renewed during the 12-month period beginning on the
   40  effective date of the assessment.
   41         2. A premium is not subject to an annual assessment under
   42  this paragraph in excess of 6 percent of premium with respect to
   43  obligations arising out of losses attributable to any one
   44  contract year, and a premium is not subject to an aggregate
   45  annual assessment under this paragraph in excess of 10 percent
   46  of premium. An annual assessment under this paragraph shall
   47  continue as long as the revenue bonds issued with respect to
   48  which the assessment was imposed are outstanding, including any
   49  bonds the proceeds of which were used to refund the revenue
   50  bonds, unless adequate provision has been made for the payment
   51  of the bonds under the documents authorizing issuance of the
   52  bonds.
   53         3. Emergency assessments shall be collected from
   54  policyholders. Emergency assessments shall be remitted by
   55  insurers as a percentage of direct written premium for the
   56  preceding calendar quarter as specified in the order from the
   57  Office of Insurance Regulation. The office shall verify the
   58  accurate and timely collection and remittance of emergency
   59  assessments and shall report the information to the board in a
   60  form and at a time specified by the board. Each insurer
   61  collecting assessments shall provide the information with
   62  respect to premiums and collections as may be required by the
   63  office to enable the office to monitor and verify compliance
   64  with this paragraph.
   65         4. With respect to assessments of surplus lines premiums,
   66  each surplus lines agent shall collect the assessment at the
   67  same time as the agent collects the surplus lines tax required
   68  by s. 626.932, and the surplus lines agent shall remit the
   69  assessment to the Florida Surplus Lines Service Office created
   70  by s. 626.921 at the same time as the agent remits the surplus
   71  lines tax to the Florida Surplus Lines Service Office. The
   72  emergency assessment on each insured procuring coverage and
   73  filing under s. 626.938 shall be remitted by the insured to the
   74  Florida Surplus Lines Service Office at the time the insured
   75  pays the surplus lines tax to the Florida Surplus Lines Service
   76  Office. The Florida Surplus Lines Service Office shall remit the
   77  collected assessments to the fund or corporation as provided in
   78  the order levied by the Office of Insurance Regulation. The
   79  Florida Surplus Lines Service Office shall verify the proper
   80  application of such emergency assessments and shall assist the
   81  board in ensuring the accurate and timely collection and
   82  remittance of assessments as required by the board. The Florida
   83  Surplus Lines Service Office shall annually calculate the
   84  aggregate written premium on property and casualty business,
   85  other than workers’ compensation and medical malpractice,
   86  procured through surplus lines agents and insureds procuring
   87  coverage and filing under s. 626.938 and shall report the
   88  information to the board in a form and at a time specified by
   89  the board.
   90         5. Any assessment authority not used for a particular
   91  contract year may be used for a subsequent contract year. If,
   92  for a subsequent contract year, the board determines that the
   93  amount of revenue produced under subsection (5) is insufficient
   94  to fund the obligations, costs, and expenses of the fund and the
   95  corporation, including repayment of revenue bonds and that
   96  portion of the debt service coverage not met by reimbursement
   97  premiums, the board shall direct the Office of Insurance
   98  Regulation to levy an emergency assessment up to an amount not
   99  exceeding the amount of unused assessment authority from a
  100  previous contract year or years, plus an additional 4 percent
  101  provided that the assessments in the aggregate do not exceed the
  102  limits specified in subparagraph 2.
  103         6. The assessments otherwise payable to the corporation
  104  under this paragraph shall be paid to the fund unless and until
  105  the Office of Insurance Regulation and the Florida Surplus Lines
  106  Service Office have received from the corporation and the fund a
  107  notice, which shall be conclusive and upon which they may rely
  108  without further inquiry, that the corporation has issued bonds
  109  and the fund has no agreements in effect with local governments
  110  under paragraph (c). On or after the date of the notice and
  111  until the date the corporation has no bonds outstanding, the
  112  fund shall have no right, title, or interest in or to the
  113  assessments, except as provided in the fund’s agreement with the
  114  corporation.
  115         7. Emergency assessments are not premium and are not
  116  subject to the premium tax, to the surplus lines tax, to any
  117  fees, or to any commissions. An insurer is liable for all
  118  assessments that it collects and must treat the failure of an
  119  insured to pay an assessment as a failure to pay the premium. An
  120  insurer is not liable for uncollectible assessments.
  121         8. When an insurer is required to return an unearned
  122  premium, it shall also return any collected assessment
  123  attributable to the unearned premium. A credit adjustment to the
  124  collected assessment may be made by the insurer with regard to
  125  future remittances that are payable to the fund or corporation,
  126  but the insurer is not entitled to a refund.
  127         9. When a surplus lines insured or an insured who has
  128  procured coverage and filed under s. 626.938 is entitled to the
  129  return of an unearned premium, the Florida Surplus Lines Service
  130  Office shall provide a credit or refund to the agent or such
  131  insured for the collected assessment attributable to the
  132  unearned premium prior to remitting the emergency assessment
  133  collected to the fund or corporation.
  134         10. The exemption of medical malpractice insurance premiums
  135  from emergency assessments under this paragraph is repealed May
  136  31, 2013 2010, and medical malpractice insurance premiums shall
  137  be subject to emergency assessments attributable to loss events
  138  occurring in the contract years commencing on June 1, 2013 2010.
  139         Section 2. This act shall take effect upon becoming a law.

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