September 19, 2020
Print This PagePrint This Page

  *
Session:
Bill #:
Session:
Chamber: View Search Tips
Search Term:
Year: View Search Tips
Search Term:
Amendment CaShTmL-435620.HTM
    Florida Senate - 2005                        SENATOR AMENDMENT
    Bill No. HB 1937, 2nd Eng.
                        Barcode 435620
                            CHAMBER ACTION
              Senate                               House
                                   .                    
                                   .                    
 1                                 .                    
                                   .                    
 2                                 .                    
                                   .                    
 3                                 .                    
                                   .                    
 4  ______________________________________________________________
 5  
 6  
 7  
 8  
 9  
10  ______________________________________________________________
11  Senator Garcia moved the following amendment:
12  
13         Senate Amendment (with title amendment) 
14         Delete everything after the enacting clause
15  
16  and insert:  
17         Section 1.  Effective June 1, 2005, paragraph (e) of
18  subsection (2) of section 215.555, Florida Statutes, is
19  amended to read:
20         215.555  Florida Hurricane Catastrophe Fund.--
21         (2)  DEFINITIONS.--As used in this section:
22         (e)  "Retention" means the amount of losses below which
23  an insurer is not entitled to reimbursement from the fund. An
24  insurer's retention shall be calculated as follows:
25         1.  The board shall calculate and report to each
26  insurer the retention multiples for that year. For the
27  contract year beginning June 1, 2005 2004, the retention
28  multiple shall be equal to $4.5 billion divided by the total
29  estimated reimbursement premium for the contract year; for
30  subsequent years, the retention multiple shall be equal to
31  $4.5 billion, adjusted based upon the reported exposure from
                                  1
    11:23 PM   05/05/05                          h193704e2c-40-j01

Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 the prior contract year to reflect the percentage growth in 2 exposure to the fund for covered policies since 2004 2003, 3 divided by the total estimated reimbursement premium for the 4 contract year. Total reimbursement premium for purposes of the 5 calculation under this subparagraph shall be estimated using 6 the assumption that all insurers have selected the 90-percent 7 coverage level. 8 2. The retention multiple as determined under 9 subparagraph 1. shall be adjusted to reflect the coverage 10 level elected by the insurer. For insurers electing the 11 90-percent coverage level, the adjusted retention multiple is 12 100 percent of the amount determined under subparagraph 1. For 13 insurers electing the 75-percent coverage level, the retention 14 multiple is 120 percent of the amount determined under 15 subparagraph 1. For insurers electing the 45-percent coverage 16 level, the adjusted retention multiple is 200 percent of the 17 amount determined under subparagraph 1. 18 3. An insurer shall determine its provisional 19 retention by multiplying its provisional reimbursement premium 20 by the applicable adjusted retention multiple and shall 21 determine its actual retention by multiplying its actual 22 reimbursement premium by the applicable adjusted retention 23 multiple. 24 4. For insurers who experience multiple covered events 25 causing loss during the contract year, beginning June 1, 2005, 26 each insurer's full retention shall be applied to each of the 27 covered events causing the two largest losses for that 28 insurer. For each other covered event resulting in losses, the 29 insurer's retention shall be reduced to one-third of the full 30 retention. The reimbursement contract shall provide for the 31 reimbursement of losses for each covered event based on the 2 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 full retention with adjustments made to reflect the reduced 2 retentions after January 1 of the contract year provided the 3 insurer reports its losses as specified in the reimbursement 4 contract. 5 Section 2. Effective July 1, 2005, section 215.559, 6 Florida Statutes, is amended to read: 7 215.559 Hurricane Loss Mitigation Program.-- 8 (1) There is created a Hurricane Loss Mitigation 9 Program. The Legislature shall annually appropriate $10 10 million of the moneys authorized for appropriation under s. 11 215.555(7)(c) from the Florida Hurricane Catastrophe Fund to 12 the Department of Community Affairs for the purposes set forth 13 in this section. 14 (2)(a) Seven million dollars in funds provided in 15 subsection (1) shall be used for programs to improve the wind 16 resistance of residences and mobile homes, including loans, 17 subsidies, grants, demonstration projects, and direct 18 assistance; cooperative programs with local governments and 19 the Federal Government; and other efforts to prevent or reduce 20 losses or reduce the cost of rebuilding after a disaster. 21 (b) Three million dollars in funds provided in 22 subsection (1) shall be used to retrofit existing facilities 23 used as public hurricane shelters. The department must 24 prioritize the use of these funds for projects included in the 25 September 1, 2000, version of the Shelter Retrofit Report 26 prepared in accordance with s. 252.385(3), and each annual 27 report thereafter. The department must give funding priority 28 to projects in regional planning council regions that have 29 shelter deficits and to projects that maximize use of state 30 funds. 31 (3) By the 2006-2007 fiscal year, the Department of 3 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 Community Affairs shall develop a low-interest loan program 2 for homeowners and mobile home owners to retrofit their homes 3 with fixtures or apply construction techniques that have been 4 demonstrated to reduce the amount of damage or loss due to a 5 hurricane. Funding for the program shall be used to subsidize 6 or guaranty private-sector loans for this purpose to qualified 7 homeowners by financial institutions chartered by the state or 8 Federal Government. The department may enter into contracts 9 with financial institutions for this purpose. The department 10 shall establish criteria for determining eligibility for the 11 loans and selecting recipients, standards for retrofitting 12 homes or mobile homes, limitations on loan subsidies and loan 13 guaranties, and other terms and conditions of the program, 14 which must be specified in the department's report to the 15 Legislature on January 1, 2006, required by subsection (8). 16 For the 2005-2006 fiscal year, the Department of Community 17 Affairs may use up to $1 million of the funds appropriated 18 pursuant to paragraph (2)(a) to begin the low-interest loan 19 program as a pilot project in one or more counties. The 20 Department of Financial Services, the Office of Financial 21 Regulation, the Florida Housing Finance Corporation, and the 22 Office of Tourism, Trade, and Economic Development shall 23 assist the Department of Community Affairs in establishing the 24 program and pilot project. The department may use up to 2.5 25 percent of the funds appropriated in any given fiscal year for 26 administering the loan program. The department may adopt rules 27 to implement the program. 28 (4)(3) Forty percent of the total appropriation in 29 paragraph (2)(a) shall be used to inspect and improve 30 tie-downs for mobile homes. Within 30 days after the effective 31 date of that appropriation, the department shall contract with 4 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 a public higher educational institution in this state which 2 has previous experience in administering the programs set 3 forth in this subsection to serve as the administrative entity 4 and fiscal agent pursuant to s. 216.346 for the purpose of 5 administering the programs set forth in this subsection in 6 accordance with established policy and procedures. The 7 administrative entity working with the advisory council set up 8 under subsection (6) (5) shall develop a list of mobile home 9 parks and counties that may be eligible to participate in the 10 tie-down program. 11 (5)(4) Of moneys provided to the Department of 12 Community Affairs in paragraph (2)(a), 10 percent shall be 13 allocated to a Type I Center within the State University 14 System dedicated to hurricane research. The Type I Center 15 shall develop a preliminary work plan approved by the advisory 16 council set forth in subsection (6) (5) to eliminate the state 17 and local barriers to upgrading existing mobile homes and 18 communities, research and develop a program for the recycling 19 of existing older mobile homes, and support programs of 20 research and development relating to hurricane loss reduction 21 devices and techniques for site-built residences. The State 22 University System also shall consult with the Department of 23 Community Affairs and assist the department with the report 24 required under subsection (8) (7). 25 (6)(5) Except for the program set forth in subsection 26 (3), The Department of Community Affairs shall develop the 27 programs set forth in this section in consultation with an 28 advisory council consisting of a representative designated by 29 the Chief Financial Officer, a representative designated by 30 the Florida Home Builders Association, a representative 31 designated by the Florida Insurance Council, a representative 5 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 designated by the Federation of Manufactured Home Owners, a 2 representative designated by the Florida Association of 3 Counties, and a representative designated by the Florida 4 Manufactured Housing Association. 5 (7)(6) Moneys provided to the Department of Community 6 Affairs under this section are intended to supplement other 7 funding sources of the Department of Community Affairs and may 8 not supplant other funding sources of the Department of 9 Community Affairs. 10 (8)(7) On January 1st of each year, the Department of 11 Community Affairs shall provide a full report and accounting 12 of activities under this section and an evaluation of such 13 activities to the Speaker of the House of Representatives, the 14 President of the Senate, and the Majority and Minority Leaders 15 of the House of Representatives and the Senate. 16 (9)(8) This section is repealed June 30, 2011. 17 Section 3. Subsections (4) and (5) of section 627.062, 18 Florida Statutes, are amended to read: 19 627.062 Rate standards.-- 20 (4) The establishment of any rate, rating 21 classification, rating plan or schedule, or variation thereof 22 in violation of part IX of chapter 626 is also in violation of 23 this section. In order to enhance the ability of consumers to 24 compare premiums and to increase the accuracy and usefulness 25 of rate-comparison information provided by the office to the 26 public, the office shall develop a proposed standard rating 27 territory plan to be used by all authorized property and 28 casualty insurers for residential property insurance. In 29 adopting the proposed plan, the office may consider 30 geographical characteristics relevant to risk, county lines, 31 major roadways, existing rating territories used by a 6 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 significant segment of the market, and other relevant factors. 2 Such plan shall be submitted to the President of the Senate 3 and the Speaker of the House of Representatives by January 15, 4 2006. The plan may not be implemented unless authorized by 5 further act of the Legislature. 6 (5) With respect to a rate filing involving coverage 7 of the type for which the insurer is required to pay a 8 reimbursement premium to the Florida Hurricane Catastrophe 9 Fund, the insurer may fully recoup in its property insurance 10 premiums any reimbursement premiums paid to the Florida 11 Hurricane Catastrophe Fund, together with reasonable costs of 12 other reinsurance, but may not recoup reinsurance costs that 13 duplicate coverage provided by the Florida Hurricane 14 Catastrophe Fund. An insurer may not recoup more than 1 year 15 of reimbursement premium at a time. Any under-recoupment from 16 the prior year may be added to the following year's 17 reimbursement premium and any over-recoupment shall be 18 subtracted from the following year's reimbursement premium. 19 Section 4. Paragraph (c) of subsection (1) and 20 paragraph (c) of subsection (3) of section 627.0628, Florida 21 Statutes, are amended to read: 22 627.0628 Florida Commission on Hurricane Loss 23 Projection Methodology.-- 24 (1) LEGISLATIVE FINDINGS AND INTENT.-- 25 (c) It is the intent of the Legislature to create the 26 Florida Commission on Hurricane Loss Projection Methodology as 27 a panel of experts to provide the most actuarially 28 sophisticated guidelines and standards for projection of 29 hurricane losses possible, given the current state of 30 actuarial science. It is the further intent of the Legislature 31 that such standards and guidelines must be used by the State 7 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 Board of Administration in developing reimbursement premium 2 rates for the Florida Hurricane Catastrophe Fund, and, subject 3 to paragraph (3)(c), may be used by insurers in rate filings 4 under s. 627.062 unless the way in which such standards and 5 guidelines were applied by the insurer was erroneous, as shown 6 by a preponderance of the evidence. 7 (3) ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES.-- 8 (c) With respect to a rate filing under s. 627.062, an 9 insurer may employ actuarial methods, principles, standards, 10 models, or output ranges found by the commission to be 11 accurate or reliable to determine hurricane loss factors for 12 use in a rate filing under s. 627.062. Such, which findings 13 and factors are admissible and relevant in consideration of a 14 rate filing by the office or in any arbitration or 15 administrative or judicial review only if the office and the 16 consumer advocate appointed pursuant to s. 627.0613 have 17 access to all of the assumptions and factors that were used in 18 developing the actuarial methods, principles, standards, 19 models, or output ranges, and are not precluded from 20 disclosing such information in a rate proceeding. 21 Section 5. Subsection (7) of section 627.0629, Florida 22 Statutes, is amended to read: 23 627.0629 Residential property insurance; rate 24 filings.-- 25 (7) Any rate filing that is based in whole or part on 26 data from a computer model may not exceed 15 25 percent unless 27 there is a public hearing. 28 Section 6. Section 627.06281, Florida Statutes, is 29 created to read: 30 627.06281 Public hurricane loss projection model; 31 reporting of data by insurers.--Within 30 days after a written 8 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 request for loss data and associated exposure data by the 2 office or a type I center within the State University System 3 established to study mitigation, residential property insurers 4 and licensed rating and advisory organizations that compile 5 residential property insurance loss data shall provide loss 6 data and associated exposure data for residential property 7 insurance policies to the office or to a type I center within 8 the State University System established to study mitigation, 9 as directed by the office, for the purposes of developing, 10 maintaining, and updating a public model for hurricane loss 11 projections. The loss data and associated exposure data 12 provided shall be in writing. 13 Section 7. Paragraphs (a), (c), and (q) of subsection 14 (6) of section 627.351, Florida Statutes, are amended to read: 15 627.351 Insurance risk apportionment plans.-- 16 (6) CITIZENS PROPERTY INSURANCE CORPORATION.-- 17 (a)1. The Legislature finds that actual and threatened 18 catastrophic losses to property in this state from hurricanes 19 have caused insurers to be unwilling or unable to provide 20 property insurance coverage to the extent sought and needed. 21 It is in the public interest and a public purpose to assist in 22 assuring that property in the state is insured so as to 23 facilitate the remediation, reconstruction, and replacement of 24 damaged or destroyed property in order to reduce or avoid the 25 negative effects otherwise resulting to the public health, 26 safety, and welfare; to the economy of the state; and to the 27 revenues of the state and local governments needed to provide 28 for the public welfare. It is necessary, therefore, to provide 29 property insurance to applicants who are in good faith 30 entitled to procure insurance through the voluntary market but 31 are unable to do so. The Legislature intends by this 9 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 subsection that property insurance be provided and that it 2 continues, as long as necessary, through an entity organized 3 to achieve efficiencies and economies, while providing service 4 to policyholders, applicants, and agents that is no less than 5 the quality generally provided in the voluntary market, all 6 toward the achievement of the foregoing public purposes. 7 Because it is essential for the corporation to have the 8 maximum financial resources to pay claims following a 9 catastrophic hurricane, it is the intent of the Legislature 10 that the income of the corporation be exempt from federal 11 income taxation and that interest on the debt obligations 12 issued by the corporation be exempt from federal income 13 taxation. 14 2. The Residential Property and Casualty Joint 15 Underwriting Association originally created by this statute 16 shall be known, as of July 1, 2002, as the Citizens Property 17 Insurance Corporation. The corporation shall provide insurance 18 for residential and commercial property, for applicants who 19 are in good faith entitled, but are unable, to procure 20 insurance through the voluntary market. The corporation shall 21 operate pursuant to a plan of operation approved by order of 22 the office. The plan is subject to continuous review by the 23 office. The office may, by order, withdraw approval of all or 24 part of a plan if the office determines that conditions have 25 changed since approval was granted and that the purposes of 26 the plan require changes in the plan. For the purposes of this 27 subsection, residential coverage includes both personal lines 28 residential coverage, which consists of the type of coverage 29 provided by homeowner's, mobile home owner's, dwelling, 30 tenant's, condominium unit owner's, and similar policies, and 31 commercial lines residential coverage, which consists of the 10 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 type of coverage provided by condominium association, 2 apartment building, and similar policies. 3 3. It is the intent of the Legislature that 4 policyholders, applicants, and agents of the corporation 5 receive service and treatment of the highest possible level 6 but never less than that generally provided in the voluntary 7 market. It also is intended that the corporation be held to 8 service standards no less than those applied to insurers in 9 the voluntary market by the office with respect to 10 responsiveness, timeliness, customer courtesy, and overall 11 dealings with policyholders, applicants, or agents of the 12 corporation. 13 (c) The plan of operation of the corporation: 14 1. Must provide for adoption of residential property 15 and casualty insurance policy forms and commercial residential 16 and nonresidential property insurance forms, which forms must 17 be approved by the office prior to use. The corporation shall 18 adopt the following policy forms: 19 a. Standard personal lines policy forms that are 20 comprehensive multiperil policies providing full coverage of a 21 residential property equivalent to the coverage provided in 22 the private insurance market under an HO-3, HO-4, or HO-6 23 policy. 24 b. Basic personal lines policy forms that are policies 25 similar to an HO-8 policy or a dwelling fire policy that 26 provide coverage meeting the requirements of the secondary 27 mortgage market, but which coverage is more limited than the 28 coverage under a standard policy. 29 c. Commercial lines residential policy forms that are 30 generally similar to the basic perils of full coverage 31 obtainable for commercial residential structures in the 11 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 admitted voluntary market. 2 d. Personal lines and commercial lines residential 3 property insurance forms that cover the peril of wind only. 4 The forms are applicable only to residential properties 5 located in areas eligible for coverage under the high-risk 6 account referred to in sub-subparagraph (b)2.a. 7 e. Commercial lines nonresidential property insurance 8 forms that cover the peril of wind only. The forms are 9 applicable only to nonresidential properties located in areas 10 eligible for coverage under the high-risk account referred to 11 in sub-subparagraph (b)2.a. 12 2.a. Must provide that the corporation adopt a program 13 in which the corporation and authorized insurers enter into 14 quota share primary insurance agreements for hurricane 15 coverage, as defined in s. 627.4025(2)(a), for eligible risks, 16 and adopt property insurance forms for eligible risks which 17 cover the peril of wind only. As used in this subsection, the 18 term: 19 (I) "Quota share primary insurance" means an 20 arrangement in which the primary hurricane coverage of an 21 eligible risk is provided in specified percentages by the 22 corporation and an authorized insurer. The corporation and 23 authorized insurer are each solely responsible for a specified 24 percentage of hurricane coverage of an eligible risk as set 25 forth in a quota share primary insurance agreement between the 26 corporation and an authorized insurer and the insurance 27 contract. The responsibility of the corporation or authorized 28 insurer to pay its specified percentage of hurricane losses of 29 an eligible risk, as set forth in the quota share primary 30 insurance agreement, may not be altered by the inability of 31 the other party to the agreement to pay its specified 12 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 percentage of hurricane losses. Eligible risks that are 2 provided hurricane coverage through a quota share primary 3 insurance arrangement must be provided policy forms that set 4 forth the obligations of the corporation and authorized 5 insurer under the arrangement, clearly specify the percentages 6 of quota share primary insurance provided by the corporation 7 and authorized insurer, and conspicuously and clearly state 8 that neither the authorized insurer nor the corporation may be 9 held responsible beyond its specified percentage of coverage 10 of hurricane losses. 11 (II) "Eligible risks" means personal lines residential 12 and commercial lines residential risks that meet the 13 underwriting criteria of the corporation and are located in 14 areas that were eligible for coverage by the Florida Windstorm 15 Underwriting Association on January 1, 2002. 16 b. The corporation may enter into quota share primary 17 insurance agreements with authorized insurers at corporation 18 coverage levels of 90 percent and 50 percent. 19 c. If the corporation determines that additional 20 coverage levels are necessary to maximize participation in 21 quota share primary insurance agreements by authorized 22 insurers, the corporation may establish additional coverage 23 levels. However, the corporation's quota share primary 24 insurance coverage level may not exceed 90 percent. 25 d. Any quota share primary insurance agreement entered 26 into between an authorized insurer and the corporation must 27 provide for a uniform specified percentage of coverage of 28 hurricane losses, by county or territory as set forth by the 29 corporation board, for all eligible risks of the authorized 30 insurer covered under the quota share primary insurance 31 agreement. 13 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 e. Any quota share primary insurance agreement entered 2 into between an authorized insurer and the corporation is 3 subject to review and approval by the office. However, such 4 agreement shall be authorized only as to insurance contracts 5 entered into between an authorized insurer and an insured who 6 is already insured by the corporation for wind coverage. 7 f. For all eligible risks covered under quota share 8 primary insurance agreements, the exposure and coverage levels 9 for both the corporation and authorized insurers shall be 10 reported by the corporation to the Florida Hurricane 11 Catastrophe Fund. For all policies of eligible risks covered 12 under quota share primary insurance agreements, the 13 corporation and the authorized insurer shall maintain complete 14 and accurate records for the purpose of exposure and loss 15 reimbursement audits as required by Florida Hurricane 16 Catastrophe Fund rules. The corporation and the authorized 17 insurer shall each maintain duplicate copies of policy 18 declaration pages and supporting claims documents. 19 g. The corporation board shall establish in its plan 20 of operation standards for quota share agreements which ensure 21 that there is no discriminatory application among insurers as 22 to the terms of quota share agreements, pricing of quota share 23 agreements, incentive provisions if any, and consideration 24 paid for servicing policies or adjusting claims. 25 h. The quota share primary insurance agreement between 26 the corporation and an authorized insurer must set forth the 27 specific terms under which coverage is provided, including, 28 but not limited to, the sale and servicing of policies issued 29 under the agreement by the insurance agent of the authorized 30 insurer producing the business, the reporting of information 31 concerning eligible risks, the payment of premium to the 14 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 corporation, and arrangements for the adjustment and payment 2 of hurricane claims incurred on eligible risks by the claims 3 adjuster and personnel of the authorized insurer. Entering 4 into a quota sharing insurance agreement between the 5 corporation and an authorized insurer shall be voluntary and 6 at the discretion of the authorized insurer. 7 3. May provide that the corporation may employ or 8 otherwise contract with individuals or other entities to 9 provide administrative or professional services that may be 10 appropriate to effectuate the plan. The corporation shall have 11 the power to borrow funds, by issuing bonds or by incurring 12 other indebtedness, and shall have other powers reasonably 13 necessary to effectuate the requirements of this subsection, 14 including without limitation, the power to issue bonds and 15 incur other indebtedness in order to refinance outstanding 16 bonds or other indebtedness. The corporation may, but is not 17 required to, seek judicial validation of its bonds or other 18 indebtedness under chapter 75. The corporation may issue bonds 19 or incur other indebtedness, or have bonds issued on its 20 behalf by a unit of local government pursuant to subparagraph 21 (g)2., in the absence of a hurricane or other weather-related 22 event, upon a determination by the corporation, subject to 23 approval by the office, that such action would enable it to 24 efficiently meet the financial obligations of the corporation 25 and that such financings are reasonably necessary to 26 effectuate the requirements of this subsection. The 27 corporation is authorized to take all actions needed to 28 facilitate tax-free status for any such bonds or indebtedness, 29 including formation of trusts or other affiliated entities. 30 The corporation shall have the authority to pledge 31 assessments, projected recoveries from the Florida Hurricane 15 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 Catastrophe Fund, other reinsurance recoverables, market 2 equalization and other surcharges, and other funds available 3 to the corporation as security for bonds or other 4 indebtedness. In recognition of s. 10, Art. I of the State 5 Constitution, prohibiting the impairment of obligations of 6 contracts, it is the intent of the Legislature that no action 7 be taken whose purpose is to impair any bond indenture or 8 financing agreement or any revenue source committed by 9 contract to such bond or other indebtedness. 10 4.a. Must require that the corporation operate subject 11 to the supervision and approval of a board of governors 12 consisting of 8 7 individuals who are residents of this state, 13 from different geographical areas of this state, appointed by 14 the Chief Financial Officer. The Governor, the Chief Financial 15 Officer, the President of the Senate, and the Speaker of the 16 House of Representatives shall each appoint two members of the 17 board, effective August 1, 2005. At least one of the two 18 members appointed by each appointing officer must have 19 demonstrated expertise in insurance. The Chief Financial 20 Officer shall designate one of the appointees as chair. All 21 board members serve at the pleasure of the appointing officer 22 Chief Financial Officer. All board members, including the 23 chair, must be appointed to serve for 3-year terms beginning 24 annually on a date designated by the plan. Any board vacancy 25 shall be filled for the unexpired term by the appointing 26 officer Chief Financial Officer. The Chief Financial Officer 27 shall appoint a technical advisory group to provide 28 information and advice to the board of governors in connection 29 with the board's duties under this subsection. The executive 30 director and senior managers of the corporation shall be 31 engaged by the board, as recommended by the Chief Financial 16 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 Officer and serve at the pleasure of the board Chief Financial 2 Officer. The executive director is responsible for employing 3 other staff as the corporation may require, subject to review 4 and concurrence by the board and office of the Chief Financial 5 Officer. 6 b. The board shall create a Market Accountability 7 Advisory Committee to assist the corporation in developing 8 awareness of its rates and its customer and agent service 9 levels in relationship to the voluntary market insurers 10 writing similar coverage. The members of the advisory 11 committee shall consist of the following 11 persons, one of 12 whom must be elected chair by the members of the committee: 13 four representatives, one appointed by the Florida Association 14 of Insurance Agents, one by the Florida Association of 15 Insurance and Financial Advisors, one by the Professional 16 Insurance Agents of Florida, and one by the Latin American 17 Association of Insurance Agencies; three representatives 18 appointed by the insurers with the three highest voluntary 19 market share of residential property insurance business in the 20 state; one representative from the Office of Insurance 21 Regulation; one consumer appointed by the board who is insured 22 by the corporation at the time of appointment to the 23 committee; one representative appointed by the Florida 24 Association of Realtors; and one representative appointed by 25 the Florida Bankers Association. All members must serve for 26 3-year terms and may serve for consecutive terms. The 27 committee shall report to the corporation at each board 28 meeting on insurance market issues which may include rates and 29 rate competition with the voluntary market; service, including 30 policy issuance, claims processing, and general responsiveness 31 to policyholders, applicants, and agents; and matters relating 17 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 to depopulation. 2 5. Must provide a procedure for determining the 3 eligibility of a risk for coverage, as follows: 4 a. Subject to the provisions of s. 627.3517, with 5 respect to personal lines residential risks, if the risk is 6 offered coverage from an authorized insurer at the insurer's 7 approved rate under either a standard policy including wind 8 coverage or, if consistent with the insurer's underwriting 9 rules as filed with the office, a basic policy including wind 10 coverage, the risk is not eligible for any policy issued by 11 the corporation. If the risk is not able to obtain any such 12 offer, the risk is eligible for either a standard policy 13 including wind coverage or a basic policy including wind 14 coverage issued by the corporation; however, if the risk could 15 not be insured under a standard policy including wind coverage 16 regardless of market conditions, the risk shall be eligible 17 for a basic policy including wind coverage unless rejected 18 under subparagraph 8. The corporation shall determine the type 19 of policy to be provided on the basis of objective standards 20 specified in the underwriting manual and based on generally 21 accepted underwriting practices. 22 (I) If the risk accepts an offer of coverage through 23 the market assistance plan or an offer of coverage through a 24 mechanism established by the corporation before a policy is 25 issued to the risk by the corporation or during the first 30 26 days of coverage by the corporation, and the producing agent 27 who submitted the application to the plan or to the 28 corporation is not currently appointed by the insurer, the 29 insurer shall: 30 (A) Pay to the producing agent of record of the 31 policy, for the first year, an amount that is the greater of 18 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 the insurer's usual and customary commission for the type of 2 policy written or a fee equal to the usual and customary 3 commission of the corporation; or 4 (B) Offer to allow the producing agent of record of 5 the policy to continue servicing the policy for a period of 6 not less than 1 year and offer to pay the agent the greater of 7 the insurer's or the corporation's usual and customary 8 commission for the type of policy written. 9 10 If the producing agent is unwilling or unable to accept 11 appointment, the new insurer shall pay the agent in accordance 12 with sub-sub-sub-subparagraph (A). 13 (II) When the corporation enters into a contractual 14 agreement for a take-out plan, the producing agent of record 15 of the corporation policy is entitled to retain any unearned 16 commission on the policy, and the insurer shall: 17 (A) Pay to the producing agent of record of the 18 corporation policy, for the first year, an amount that is the 19 greater of the insurer's usual and customary commission for 20 the type of policy written or a fee equal to the usual and 21 customary commission of the corporation; or 22 (B) Offer to allow the producing agent of record of 23 the corporation policy to continue servicing the policy for a 24 period of not less than 1 year and offer to pay the agent the 25 greater of the insurer's or the corporation's usual and 26 customary commission for the type of policy written. 27 28 If the producing agent is unwilling or unable to accept 29 appointment, the new insurer shall pay the agent in accordance 30 with sub-sub-sub-subparagraph (A). 31 b. With respect to commercial lines residential risks, 19 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 if the risk is offered coverage under a policy including wind 2 coverage from an authorized insurer at its approved rate, the 3 risk is not eligible for any policy issued by the corporation. 4 If the risk is not able to obtain any such offer, the risk is 5 eligible for a policy including wind coverage issued by the 6 corporation. 7 (I) If the risk accepts an offer of coverage through 8 the market assistance plan or an offer of coverage through a 9 mechanism established by the corporation before a policy is 10 issued to the risk by the corporation or during the first 30 11 days of coverage by the corporation, and the producing agent 12 who submitted the application to the plan or the corporation 13 is not currently appointed by the insurer, the insurer shall: 14 (A) Pay to the producing agent of record of the 15 policy, for the first year, an amount that is the greater of 16 the insurer's usual and customary commission for the type of 17 policy written or a fee equal to the usual and customary 18 commission of the corporation; or 19 (B) Offer to allow the producing agent of record of 20 the policy to continue servicing the policy for a period of 21 not less than 1 year and offer to pay the agent the greater of 22 the insurer's or the corporation's usual and customary 23 commission for the type of policy written. 24 25 If the producing agent is unwilling or unable to accept 26 appointment, the new insurer shall pay the agent in accordance 27 with sub-sub-sub-subparagraph (A). 28 (II) When the corporation enters into a contractual 29 agreement for a take-out plan, the producing agent of record 30 of the corporation policy is entitled to retain any unearned 31 commission on the policy, and the insurer shall: 20 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 (A) Pay to the producing agent of record of the 2 corporation policy, for the first year, an amount that is the 3 greater of the insurer's usual and customary commission for 4 the type of policy written or a fee equal to the usual and 5 customary commission of the corporation; or 6 (B) Offer to allow the producing agent of record of 7 the corporation policy to continue servicing the policy for a 8 period of not less than 1 year and offer to pay the agent the 9 greater of the insurer's or the corporation's usual and 10 customary commission for the type of policy written. 11 12 If the producing agent is unwilling or unable to accept 13 appointment, the new insurer shall pay the agent in accordance 14 with sub-sub-sub-subparagraph (A). 15 6. Must include rules for classifications of risks and 16 rates therefor. 17 7. Must provide that if premium and investment income 18 for an account attributable to a particular calendar year are 19 in excess of projected losses and expenses for the account 20 attributable to that year, such excess shall be held in 21 surplus in the account. Such surplus shall be available to 22 defray deficits in that account as to future years and shall 23 be used for that purpose prior to assessing assessable 24 insurers and assessable insureds as to any calendar year. 25 8. Must provide objective criteria and procedures to 26 be uniformly applied for all applicants in determining whether 27 an individual risk is so hazardous as to be uninsurable. In 28 making this determination and in establishing the criteria and 29 procedures, the following shall be considered: 30 a. Whether the likelihood of a loss for the individual 31 risk is substantially higher than for other risks of the same 21 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 class; and 2 b. Whether the uncertainty associated with the 3 individual risk is such that an appropriate premium cannot be 4 determined. 5 6 The acceptance or rejection of a risk by the corporation shall 7 be construed as the private placement of insurance, and the 8 provisions of chapter 120 shall not apply. 9 9. Must provide that the corporation shall make its 10 best efforts to procure catastrophe reinsurance at reasonable 11 rates, to cover its projected 100-year probable maximum loss 12 as determined by the board of governors. 13 10. Must provide that in the event of regular deficit 14 assessments under sub-subparagraph (b)3.a. or sub-subparagraph 15 (b)3.b., in the personal lines account, the commercial lines 16 residential account, or the high-risk account, the corporation 17 shall levy upon corporation policyholders in its next rate 18 filing, or by a separate rate filing solely for this purpose, 19 a market equalization surcharge arising from a regular 20 assessment in such account in a percentage equal to the total 21 amount of such regular assessments divided by the aggregate 22 statewide direct written premium for subject lines of business 23 for the prior calendar year. Market equalization surcharges 24 under this subparagraph are not considered premium and are not 25 subject to commissions, fees, or premium taxes; however, 26 failure to pay a market equalization surcharge shall be 27 treated as failure to pay premium. 28 11. The policies issued by the corporation must 29 provide that, if the corporation or the market assistance plan 30 obtains an offer from an authorized insurer to cover the risk 31 at its approved rates, the risk is no longer eligible for 22 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 renewal through the corporation. 2 12. Corporation policies and applications must include 3 a notice that the corporation policy could, under this 4 section, be replaced with a policy issued by an authorized 5 insurer that does not provide coverage identical to the 6 coverage provided by the corporation. The notice shall also 7 specify that acceptance of corporation coverage creates a 8 conclusive presumption that the applicant or policyholder is 9 aware of this potential. 10 13. May establish, subject to approval by the office, 11 different eligibility requirements and operational procedures 12 for any line or type of coverage for any specified county or 13 area if the board determines that such changes to the 14 eligibility requirements and operational procedures are 15 justified due to the voluntary market being sufficiently 16 stable and competitive in such area or for such line or type 17 of coverage and that consumers who, in good faith, are unable 18 to obtain insurance through the voluntary market through 19 ordinary methods would continue to have access to coverage 20 from the corporation. When coverage is sought in connection 21 with a real property transfer, such requirements and 22 procedures shall not provide for an effective date of coverage 23 later than the date of the closing of the transfer as 24 established by the transferor, the transferee, and, if 25 applicable, the lender. 26 14. Must provide that, with respect to the high-risk 27 account, any assessable insurer with a surplus as to 28 policyholders of $25 million or less writing 25 percent or 29 more of its total countrywide property insurance premiums in 30 this state may petition the office, within the first 90 days 31 of each calendar year, to qualify as a limited apportionment 23 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 company. In no event shall a limited apportionment company be 2 required to participate in the portion of any assessment, 3 within the high-risk account, pursuant to sub-subparagraph 4 (b)3.a. or sub-subparagraph (b)3.b. in the aggregate which 5 exceeds $50 million after payment of available high-risk 6 account funds in any calendar year. However, a limited 7 apportionment company shall collect from its policyholders any 8 emergency assessment imposed under sub-subparagraph (b)3.d. 9 The plan shall provide that, if the office determines that any 10 regular assessment will result in an impairment of the surplus 11 of a limited apportionment company, the office may direct that 12 all or part of such assessment be deferred as provided in 13 subparagraph (g)4. However, there shall be no limitation or 14 deferment of an emergency assessment to be collected from 15 policyholders under sub-subparagraph (b)3.d. 16 15. Must provide that the corporation appoint as its 17 licensed agents only those agents who also hold an appointment 18 as defined in s. 626.015(3) with an insurer who at the time of 19 the agent's initial appointment by the corporation is 20 authorized to write and is actually writing personal lines 21 residential property coverage, commercial residential property 22 coverage, or commercial nonresidential property coverage 23 within the state. 24 (q) The corporation shall not require the securing of 25 flood insurance as a condition of coverage if the property 26 risk of the insured or applicant is located in a Special Flood 27 Hazard Area as defined by the Federal Emergency Management 28 Agency for the National Flood Insurance Program. executes a 29 form approved by the office affirming that Flood insurance is 30 not provided by the corporation and that if flood insurance is 31 not secured by the applicant or insured in addition to 24 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 coverage by the corporation, the risk will not be covered for 2 flood damage. A corporation policyholder that does electing 3 not to secure flood insurance and makes a claim executing a 4 form as provided herein making a claim for water damage 5 against the corporation shall have the burden of proving the 6 damage was not caused by flooding. Notwithstanding other 7 provisions of this subsection, the corporation may deny 8 coverage or refuse to issue or renew a policy to an applicant 9 or insured who refuses to purchase flood insurance as required 10 by this subsection to execute the form described herein. 11 Section 8. Section 627.40951, Florida Statutes, is 12 created to read: 13 627.40951 Standard personal lines residential 14 insurance policy.-- 15 (1) The Legislature finds that many consumers who 16 filed property loss claims as a result of the hurricanes that 17 struck this state in 2004 were inadequately insured due to the 18 difficulty consumers encounter in trying to understand the 19 complex nature of property insurance policies. The purpose and 20 intent of this section is to have property and casualty 21 insurers offer standard personal lines residential property 22 insurance policies and standard checklists of policy contents, 23 in accordance with s. 627.4143, to consumers and to ensure 24 that these policies and checklists are written in a simple 25 format with easily readable language that will enable most 26 consumers to understand the principal benefits and coverage 27 provided in the policy; the principal exclusions and 28 limitations or reductions contained in the policy, including, 29 but not limited to, deductibles, coinsurance, and any other 30 limitations or reductions; and any additional coverage 31 provided through any rider or endorsement that accompanies the 25 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 policy and renewal or cancellation provisions. 2 (2) The Chief Financial Officer shall appoint an 3 advisory committee composed of two representatives of insurers 4 currently selling personal lines residential property 5 insurance coverage, two representatives of property and 6 casualty agents, two representatives of consumers, two 7 representatives of the Commissioner of Insurance Regulation, 8 and the Insurance Consumer Advocate or her or his designee. 9 The Chief Financial Officer or her or his designee shall serve 10 as chair of the committee. The committee shall develop policy 11 language for coverage that represents general industry 12 standards in the market for comprehensive coverage under 13 personal lines residential insurance policies and shall 14 develop a checklist to be used with each type of personal 15 lines residential property insurance policy. The committee 16 shall review policies and related forms written by Insurance 17 Services Office, Inc. The committee shall file a report 18 containing its recommendations to the President of the Senate 19 and the Speaker of the House of Representatives by January 15, 20 2006. No insurer shall be required to offer the standard 21 policy unless required by further act of the Legislature. 22 Section 9. Subsection (1) of section 627.411, Florida 23 Statutes, is amended to read: 24 627.411 Grounds for disapproval.-- 25 (1) The office shall disapprove any form filed under 26 s. 627.410, or withdraw any previous approval thereof, only if 27 the form: 28 (a) Is in any respect in violation of, or does not 29 comply with, this code. 30 (b) Contains or incorporates by reference, where such 31 incorporation is otherwise permissible, any inconsistent, 26 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 ambiguous, or misleading clauses, or exceptions and conditions 2 which deceptively affect the risk purported to be assumed in 3 the general coverage of the contract. 4 (c) Has any title, heading, or other indication of its 5 provisions which is misleading. 6 (d) Is printed or otherwise reproduced in such manner 7 as to render any material provision of the form substantially 8 illegible. 9 (e) Is for residential property insurance and contains 10 provisions that are unfair or inequitable or encourage 11 misrepresentation. 12 (f)(e) Is for health insurance, and: 13 1. Provides benefits that are unreasonable in relation 14 to the premium charged.; 15 2. Contains provisions that are unfair or inequitable 16 or contrary to the public policy of this state or that 17 encourage misrepresentation.; 18 3. Contains provisions that apply rating practices 19 that result in unfair discrimination pursuant to s. 20 626.9541(1)(g)2. 21 (g)(f) Excludes coverage for human immunodeficiency 22 virus infection or acquired immune deficiency syndrome or 23 contains limitations in the benefits payable, or in the terms 24 or conditions of such contract, for human immunodeficiency 25 virus infection or acquired immune deficiency syndrome which 26 are different than those which apply to any other sickness or 27 medical condition. 28 Section 10. Paragraphs (d) and (e) are added to 29 subsection (2) of section 627.4133, Florida Statutes, to read: 30 627.4133 Notice of cancellation, nonrenewal, or 31 renewal premium.-- 27 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 (2) With respect to any personal lines or commercial 2 residential property insurance policy, including, but not 3 limited to, any homeowner's, mobile home owner's, farmowner's, 4 condominium association, condominium unit owner's, apartment 5 building, or other policy covering a residential structure or 6 its contents: 7 (d)1. Upon a declaration of an emergency pursuant to 8 s. 252.36 and the filing of an order by the Commissioner of 9 Insurance Regulation, an insurer may not cancel or nonrenew a 10 personal residential or commercial residential property 11 insurance policy covering a dwelling or residential property 12 located in this state which has been damaged as a result of a 13 hurricane or wind loss that is the subject of the declaration 14 of emergency for a period of 90 days after the dwelling or 15 residential property has been repaired. A structure is deemed 16 to be repaired when substantially completed and restored to 17 the extent that it is insurable by another authorized insurer 18 that is writing policies in this state. 19 2. However, an insurer or agent may cancel or nonrenew 20 such a policy prior to the repair of the dwelling or 21 residential property: 22 a. Upon 10 days' notice for nonpayment of premium; or 23 b. Upon 45 days' notice: 24 (I) For a material misstatement or fraud related to 25 the claim; 26 (II) If the insurer determines that the insured has 27 unreasonably caused a delay in the repair of the dwelling; or 28 (III) If the insurer has paid policy limits. 29 3. If the insurer elects to nonrenew a policy covering 30 a property that has been damaged, the insurer shall provide at 31 least 90 days' notice to the insured that the insurer intends 28 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 to nonrenew the policy 90 days after the dwelling or 2 residential property has been repaired. Nothing in this 3 paragraph shall prevent the insurer from canceling or 4 nonrenewing the policy 90 days after the repairs are complete 5 for the same reasons the insurer would otherwise have canceled 6 or nonrenewed the policy but for the limitations of 7 subparagraph 1. The Financial Services Commission may adopt 8 rules, and the Commissioner of Insurance Regulation may issue 9 orders, necessary to implement this paragraph. 10 4. This paragraph shall also apply to personal 11 residential and commercial residential policies covering 12 property that was damaged as the result of Tropical Storm 13 Bonnie, Hurricane Charley, Hurricane Frances, Hurricane Ivan, 14 or Hurricane Jeanne. 15 (e) If any cancellation or nonrenewal of a policy 16 subject to this subsection is to take effect during the 17 duration of a hurricane as defined in s. 627.4025(2)(c), the 18 effective date of such cancellation or nonrenewal is extended 19 until the end of the duration of such hurricane. The insurer 20 may collect premium at the prior rates or the rates then in 21 effect for the period of time for which coverage is extended. 22 This paragraph does not apply to any property with respect to 23 which replacement coverage has been obtained and which is in 24 effect for a claim occurring during the duration of the 25 hurricane. 26 Section 11. Effective January 1, 2006, section 27 627.4143, Florida Statutes, is amended to read: 28 627.4143 Outline of coverage.-- 29 (1) No private passenger automobile or basic 30 homeowner's policy shall be delivered or issued for delivery 31 in this state unless an appropriate outline of coverage has 29 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 been delivered prior to issuance of the policy or accompanies 2 the policy when issued. 3 (2) The outline of coverage for a private passenger 4 motor vehicle insurance policy shall contain all of the 5 following: 6 (a) A brief description of the principal benefits and 7 coverage provided in the policy, broken down by each class or 8 type of coverage provided under the policy for which a premium 9 is charged, and itemization of the applicable premium. 10 (b) A summary statement of the principal exclusions 11 and limitations or reductions contained in the policy by class 12 or type, including, but not limited to, deductibles, 13 coinsurance, and any other limitations or reductions. 14 (c) A summary statement of any renewal or cancellation 15 provisions. 16 (d) A description of the credit or surcharge plan that 17 is being applied. The description may display numerical or 18 alphabetical codes on the declarations page or premium notice 19 to enable the insured to determine the reason or reasons why 20 her or his policy is being surcharged or is receiving a 21 credit. 22 (e) A list of any additional coverage provided through 23 any rider or endorsement which accompanies the policy. The 24 list shall contain a descriptive reference to each additional 25 coverage, rather than solely a reference to a form or code 26 number. 27 (f) For a private passenger motor vehicle insurance 28 policy, The extent of coverage provided to the insured in the 29 event of collision damage to a rental vehicle rented by the 30 insured. The proof-of-insurance card required by s. 316.646 31 must also specify whether rental car coverage is provided, and 30 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 may refer to the outline of coverage as to the details or 2 extent of coverage. 3 (3) A basic homeowners', mobile homeowners', dwelling, 4 or condominium unit owners' policy may not be delivered or 5 issued for delivery in this state unless a comprehensive 6 checklist of coverage on a form adopted by the commission and 7 an appropriate outline of coverage have been delivered prior 8 to issuance of the policy or accompanies the policy when 9 issued. The commission shall, by rule, adopt a form for the 10 checklist for each type of policy to which this subsection 11 applies. Each form shall indicate that it was adopted by the 12 commission. 13 (a) The checklist must contain a list of the standard 14 provisions and elements that may typically be included in 15 these policies, whether or not they are included in the 16 particular policy being issued, in a format that allows the 17 insurer to place a check mark next to the provisions elements 18 that are included so that the consumer can see both what is 19 included and what is not included in the policy. As an 20 alternative to checking the boxes on the checklist, an insurer 21 may delete the check boxes from the form and replace them with 22 text indicating whether the provision's elements are included 23 or not. Limits of liability shall be listed for each item. The 24 checklist must include, but is not limited to, the following: 25 1. Property coverage for the principal premises shown 26 in the declarations. 27 2. Property coverage for other structures on the 28 residence premises. 29 3. Whether the principal premises and other structures 30 are insured against the following perils: 31 a. Fire. 31 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 b. Lightning. 2 c. Explosion. 3 d. Hurricane loss. 4 e. Nonhurricane wind loss. 5 f. Collapse. 6 g. Mold. 7 h. Sinkhole loss. 8 i. Vandalism. 9 4. Personal property coverage. 10 5. Whether personal property is insured against the 11 following perils: 12 a. Fire. 13 b. Lightning. 14 c. Hurricane loss. 15 d. Nonhurricane wind loss. 16 e. Collapse. 17 f. Mold. 18 g. Sinkhole loss. 19 h. Theft. 20 6. The following additional coverages: 21 a. Debris removal. 22 b. Loss assessment. 23 c. Additional living expenses. 24 7. Personal liability coverage. 25 8. Medical payments coverage. 26 9. Discounts applied to the premium. 27 10. Deductibles for loss due to hurricane and loss to 28 other perils. 29 11. Building ordinance or law coverage. 30 12. Replacement cost coverage. 31 13. Actual cash value coverage. 32 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 (b) The forms shall allow insurers to place other 2 coverages on the checklists which may or may not be included 3 in the insurer's policies. 4 (c) The outline of coverage must contain: 5 1. A brief description of the principal benefits and 6 coverage provided in the policy, broken down by each class or 7 type of coverage provided under the policy for which a premium 8 is charged, and itemization of the applicable premium. 9 2. A summary statement of the principal exclusions and 10 limitations or reductions contained in the policy by class or 11 type, including, but not limited to, deductibles, coinsurance, 12 and any other limitations or reductions. 13 3. A summary statement of any renewal or cancellation 14 provisions. 15 4. A description of the credit or surcharge plan that 16 is being applied. The description may display numerical or 17 alphabetical codes on the declarations page or premium notice 18 to enable the insured to determine the reason or reasons why 19 her or his policy is being surcharged or is receiving a 20 credit. 21 5. A summary of any additional coverage provided 22 through any rider or endorsement that accompanies the policy. 23 (4)(3) The outline of coverage for a private passenger 24 motor vehicle policy is required only on the initial policy 25 issued by an insurer. The outline of coverage and the 26 checklist for a basic homeowners', mobile homeowners', 27 dwelling, or condominium unit owners' policy is required on 28 the initial policy and each renewal thereof issued by an 29 insurer. 30 (5)(4) An insurer must insert the following language 31 on the outline of coverage: 33 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 2 "The following outline of coverage or checklist is for 3 informational purposes only. Florida law prohibits this 4 outline or checklist from changing any of the provisions of 5 the insurance contract which is the subject of this outline. 6 Any endorsement regarding changes in types of coverage, 7 exclusions, limitations, reductions, deductibles, coinsurance, 8 renewal provisions, cancellation provisions, surcharges, or 9 credits will be sent separately." 10 11 (6)(5) Neither this section nor the outline of 12 coverage or checklist mandated by this section alters or 13 modifies the terms of the insurance contract, creates a cause 14 of action, or is admissible in any civil action. 15 Section 12. Effective October 1, 2005, subsections 16 (3), (4), (8), and (9) of section 627.701, Florida Statutes, 17 as amended by section 4 of chapter 2004-480, Laws of Florida, 18 are amended to read: 19 627.701 Liability of insureds; coinsurance; 20 deductibles.-- 21 (3)(a) A policy of residential property insurance 22 shall include a deductible amount applicable to hurricane or 23 wind losses no lower than $500 and no higher than 2 percent of 24 the policy dwelling limits with respect to personal lines 25 residential risks, and no higher than 3 percent of the policy 26 limits with respect to commercial lines residential risks; 27 however, if a risk was covered on August 24, 1992, under a 28 policy having a higher deductible than the deductibles allowed 29 by this paragraph, a policy covering such risk may include a 30 deductible no higher than the deductible in effect on August 31 24, 1992. Notwithstanding the other provisions of this 34 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 paragraph, a personal lines residential policy covering a risk 2 valued at $50,000 or less may include a deductible amount 3 attributable to hurricane or wind losses no lower than $250, 4 and a personal lines residential policy covering a risk valued 5 at $100,000 or more may include a deductible amount 6 attributable to hurricane or wind losses no higher than 10 5 7 percent of the policy limits unless subject to a higher 8 deductible on August 24, 1992; however, no maximum deductible 9 is required with respect to a personal lines residential 10 policy covering a risk valued at more than $500,000. An 11 insurer may require a higher deductible, provided such 12 deductible is the same as or similar to a deductible program 13 lawfully in effect on June 14, 1995. In addition to the 14 deductible amounts authorized by this paragraph, an insurer 15 may also offer policies with a copayment provision under 16 which, after exhaustion of the deductible, the policyholder is 17 responsible for 10 percent of the next $10,000 of insured 18 hurricane or wind losses. 19 (b)1. Except as otherwise provided in this paragraph, 20 prior to issuing a personal lines residential property 21 insurance policy on or after January 1, 2006 April 1, 1996, or 22 prior to the first renewal of a residential property insurance 23 policy on or after January 1, 2006 April 1, 1996, the insurer 24 must offer alternative deductible amounts applicable to 25 hurricane or wind losses equal to $500, and 2 percent, 5 26 percent, and 10 percent of the policy dwelling limits, unless 27 the specific percentage 2 percent deductible is less than 28 $500. The written notice of the offer shall specify the 29 hurricane or wind deductible to be applied in the event that 30 the applicant or policyholder fails to affirmatively choose a 31 hurricane deductible. The insurer must provide such 35 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 policyholder with notice of the availability of the deductible 2 amounts specified in this paragraph in a form approved by the 3 office in conjunction with each renewal of the policy. The 4 failure to provide such notice constitutes a violation of this 5 code but does not affect the coverage provided under the 6 policy. 7 2. This paragraph does not apply with respect to a 8 deductible program lawfully in effect on June 14, 1995, or to 9 any similar deductible program, if the deductible program 10 requires a minimum deductible amount of no less than 2 percent 11 of the policy limits. 12 3. With respect to a policy covering a risk with 13 dwelling limits of at least $100,000, but less than $250,000, 14 the insurer may, in lieu of offering a policy with a $500 15 hurricane or wind deductible as required by subparagraph 1., 16 offer a policy that the insurer guarantees it will not 17 nonrenew for reasons of reducing hurricane loss for one 18 renewal period and that contains up to a 2 percent hurricane 19 or wind deductible as required by subparagraph 1. 20 4. With respect to a policy covering a risk with 21 dwelling limits of $250,000 or more, the insurer need not 22 offer the $500 hurricane or wind deductible as required by 23 subparagraph 1., but must, except as otherwise provided in 24 this subsection, offer the other 2 percent hurricane 25 deductibles or wind deductible as required by subparagraph 1. 26 (c) In order to provide for the transition from wind 27 deductibles to hurricane deductibles as required by this 28 subsection, an insurer is required to provide wind deductibles 29 meeting the requirements of this subsection until the 30 effective date of the insurer's first rate filing made after 31 January 1, 1997, and is thereafter required to provide 36 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 hurricane deductibles meeting the requirements of this 2 subsection. 3 (4)(a) Any policy that contains a separate hurricane 4 deductible must on its face include in boldfaced type no 5 smaller than 18 points the following statement: "THIS POLICY 6 CONTAINS A SEPARATE DEDUCTIBLE FOR HURRICANE LOSSES, WHICH MAY 7 RESULT IN HIGH OUT-OF-POCKET EXPENSES TO YOU." A policy 8 containing a coinsurance provision applicable to hurricane 9 losses must on its face include in boldfaced type no smaller 10 than 18 points the following statement: "THIS POLICY CONTAINS 11 A CO-PAY PROVISION THAT MAY RESULT IN HIGH OUT-OF-POCKET 12 EXPENSES TO YOU." 13 (b) Beginning October 1, 2005, for any personal lines 14 residential property insurance policy containing a separate 15 hurricane deductible, the insurer shall compute and 16 prominently display the actual dollar value of the hurricane 17 deductible on the declarations page of the policy at issuance 18 and, for renewal, on the renewal declarations page of the 19 policy or on the premium renewal notice. 20 (c) Beginning October 1, 2005, for any personal lines 21 residential property insurance policy containing an inflation 22 guard rider, the insurer shall compute and prominently display 23 the actual dollar value of the hurricane deductible on the 24 declarations page of the policy at issuance and, for renewal, 25 on the renewal declarations page of the policy or on the 26 premium renewal notice. In addition, beginning October 1, 27 2005, for any personal lines residential property insurance 28 policy containing an inflation guard rider, the insurer shall 29 notify the policyholder of the possibility that the hurricane 30 deductible may be higher than indicated when loss occurs due 31 to application of the inflation guard rider. Such notification 37 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 shall be made on the declarations page of the policy at 2 issuance and, for renewal, on the renewal declarations page of 3 the policy or on the premium renewal notice. 4 (8)(a) The Legislature finds that property insurance 5 coverage has become unaffordable for a significant number of 6 mobile home owners, as evidenced by reports that up to 100,000 7 mobile home owners have terminated their insurance coverage 8 because they cannot afford to pay approved rates charged in 9 the voluntary or residual markets. The Legislature further 10 finds that additional flexibility in available coverages will 11 enable mobile home owners to obtain affordable insurance and 12 increase capacity. 13 (b) Notwithstanding the provisions of subsection (3), 14 with respect to mobile home policies: 15 1. The deductible for hurricane coverage may not 16 exceed 10 percent of the property value if the property is not 17 subject to any liens and may not exceed 5 percent of the 18 property value if the property is subject to any liens. 19 2. The insurer need not make the offers required by 20 paragraph (3)(b). 21 (8)(9) Notwithstanding the other provisions of this 22 section or of other law, but only as to hurricane coverage as 23 defined in s. 627.4025 for commercial lines residential 24 coverages, an insurer may offer a deductible in an amount not 25 exceeding 5 percent of the insured value with respect to a 26 condominium association or cooperative association policy, or 27 in an amount not exceeding 10 percent of the insured value 28 with respect to any other commercial lines residential policy, 29 if, at the time of such offer and at each renewal, the insurer 30 also offers to the policyholder a deductible in the amount of 31 3 percent of the insured value. Nothing in this subsection 38 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 prohibits any deductible otherwise authorized by this section. 2 All forms by which the offers authorized in this subsection 3 are made or required to be made shall be on forms that are 4 adopted or approved by the commission or office. 5 Section 13. Subsection (5) of section 627.701, Florida 6 Statutes, as amended by section 4 of chapter 2004-480, Laws of 7 Florida, is amended to read: 8 627.701 Liability of Insureds; coinsurance; 9 deductibles.-- 10 (5)(a) The hurricane deductible of any personal lines 11 residential property insurance policy issued or renewed on or 12 after May 1, 2005, shall be applied as follows: 13 1.(a) The hurricane deductible shall apply on an 14 annual basis to all covered hurricane losses that occur during 15 the calendar year for losses that are covered under one or 16 more policies issued by the same insurer or an insurer in the 17 same insurer group. 18 2.(b) If a hurricane deductible applies separately to 19 each of one or more structures insured under a single policy, 20 the requirements of this paragraph subsection apply with 21 respect to the deductible for each structure. 22 3.(c) If there was a hurricane loss for a prior 23 hurricane or hurricanes during the calendar year, the insurer 24 may apply a deductible to a subsequent hurricane which that is 25 the greater of the remaining amount of the hurricane 26 deductible or the amount of the deductible that applies to 27 perils other than a hurricane. Insurers may require 28 policyholders to report hurricane losses that are below the 29 hurricane deductible or to maintain receipts or other records 30 of such hurricane losses in order to apply such losses to 31 subsequent hurricane claims. 39 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 4.(d) If there are hurricane losses in a calendar year 2 on more than one policy issued by the same insurer or an 3 insurer in the same insurer group, the hurricane deductible 4 shall be the highest amount stated in any one of the policies. 5 If a policyholder who had a hurricane loss under the prior 6 policy is provided or offered a lower hurricane deductible 7 under the new or renewal policy, the insurer must notify the 8 policyholder, in writing, at the time the lower hurricane 9 deductible is provided or offered, that the lower hurricane 10 deductible will not apply until January 1 of the following 11 calendar year. 12 (b) For commercial residential property insurance 13 policies issued or renewed on or after January 1, 2006, the 14 insurer must offer the policyholder the following alternative 15 hurricane deductibles: 16 1. A hurricane deductible that applies on an annual 17 basis as provided in paragraph (a); and 18 2. A hurricane deductible that applies to each 19 hurricane. 20 Section 14. Effective October 1, 2005, section 21 627.7011, Florida Statutes, is amended to read: 22 627.7011 Homeowners' policies; offer of replacement 23 cost coverage and law and ordinance coverage.-- 24 (1) Prior to issuing a homeowner's insurance policy on 25 or after October 1, 2005 June 1, 1994, or prior to the first 26 renewal of a homeowner's insurance policy on or after October 27 1, 2005 June 1, 1994, the insurer must offer each of the 28 following: 29 (a) A policy or endorsement providing that any loss 30 which is repaired or replaced will be adjusted on the basis of 31 replacement costs not exceeding policy limits as to the 40 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 dwelling, rather than actual cash value, but not including 2 costs necessary to meet applicable laws and ordinances 3 regulating the construction, use, or repair of any property or 4 requiring the tearing down of any property, including the 5 costs of removing debris. 6 (b) A policy or endorsement providing that, subject to 7 other policy provisions, any loss which is repaired or 8 replaced at any location will be adjusted on the basis of 9 replacement costs not exceeding policy limits as to the 10 dwelling, rather than actual cash value, and also including 11 costs necessary to meet applicable laws and ordinances 12 regulating the construction, use, or repair of any property or 13 requiring the tearing down of any property, including the 14 costs of removing debris; however, such additional costs 15 necessary to meet applicable laws and ordinances may be 16 limited to either 25 percent or 50 percent of the dwelling 17 limit, as selected by the policyholder, and such coverage 18 shall apply only to repairs of the damaged portion of the 19 structure unless the total damage to the structure exceeds 50 20 percent of the replacement cost of the structure. 21 22 An insurer is not required to make the offers required by this 23 subsection with respect to the issuance or renewal of a 24 homeowner's policy that contains the provisions specified in 25 paragraph (b) for law and ordinance coverage limited to 25 26 percent of the dwelling limit, except that the insurer must 27 offer the law and ordinance coverage limited to 50 percent of 28 the dwelling limit. This subsection does not prohibit the 29 offer of a guaranteed replacement cost policy. 30 (2) Unless the insurer obtains the policyholder's 31 written refusal of the policies or endorsements specified in 41 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 subsection (1), any policy covering the dwelling is deemed to 2 include the coverage specified in paragraph (1)(b). The 3 rejection or selection of alternative coverage shall be made 4 on a form approved by the office. The form shall fully advise 5 the applicant of the nature of the coverage being rejected. If 6 this form is signed by a named insured, it will be 7 conclusively presumed that there was an informed, knowing 8 rejection of the coverage or election of the alternative 9 coverage on behalf of all insureds. Unless the policyholder 10 requests in writing the coverage specified in this section, it 11 need not be provided in or supplemental to any other policy 12 that renews, insures, extends, changes, supersedes, or 13 replaces an existing policy when the policyholder has rejected 14 the coverage specified in this section or has selected 15 alternative coverage. The insurer must provide such 16 policyholder with notice of the availability of such coverage 17 in a form approved by the office at least once every 3 years. 18 The failure to provide such notice constitutes a violation of 19 this code, but does not affect the coverage provided under the 20 policy. 21 (3) In the event of a loss for which a dwelling or 22 personal property is insured on the basis of replacement 23 costs, the insurer shall pay the replacement cost without 24 reservation or holdback of any depreciation in value, whether 25 or not the insured replaces or repairs the dwelling or 26 property. 27 (4) Any homeowner's insurance policy issued or renewed 28 on or after October 1, 2005, must include in bold type no 29 smaller than 18 points the following statement: 30 "LAW AND ORDINANCE COVERAGE IS AN IMPORTANT 31 COVERAGE THAT YOU MAY WISH TO PURCHASE. YOU MAY 42 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 ALSO NEED TO CONSIDER THE PURCHASE OF FLOOD 2 INSURANCE FROM THE NATIONAL FLOOD INSURANCE 3 PROGRAM. WITHOUT THIS COVERAGE, YOU MAY HAVE 4 UNCOVERED LOSSES. PLEASE DISCUSS THESE 5 COVERAGES WITH YOUR INSURANCE AGENT." 6 The intent of this subsection is to encourage 7 policyholders to purchase sufficient coverage to protect them 8 in case events excluded from the standard homeowners policy, 9 such as law and ordinance enforcement and flood, combine with 10 covered events to produce damage or loss to the insured 11 property. The intent is also to encourage policyholders to 12 discuss these issues with their insurance agent. 13 (5)(3) Nothing in this section shall be construed to 14 apply to policies not considered to be "homeowners' policies," 15 as that term is commonly understood in the insurance industry. 16 This section specifically does not apply to mobile home 17 policies. Nothing in this section shall be construed as 18 limiting the ability of any insurer to reject or nonrenew any 19 insured or applicant on the grounds that the structure does 20 not meet underwriting criteria applicable to replacement cost 21 or law and ordinance policies or for other lawful reasons. 22 Section 15. Effective July 1, 2005, subsections (1) 23 and (7) of section 627.7015, Florida Statutes, are amended, 24 and subsection (2) of that section is reenacted, to read: 25 627.7015 Alternative procedure for resolution of 26 disputed property insurance claims.-- 27 (1) PURPOSE AND SCOPE.--This section sets forth a 28 nonadversarial alternative dispute resolution procedure for a 29 mediated claim resolution conference prompted by the need for 30 effective, fair, and timely handling of property insurance 31 claims. There is a particular need for an informal, 43 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 nonthreatening forum for helping parties who elect this 2 procedure to resolve their claims disputes because most 3 homeowner's and commercial residential insurance policies 4 obligate insureds to participate in a potentially expensive 5 and time-consuming adversarial appraisal process prior to 6 litigation. The procedure set forth in this section is 7 designed to bring the parties together for a mediated claims 8 settlement conference without any of the trappings or 9 drawbacks of an adversarial process. Before resorting to these 10 procedures, insureds and insurers are encouraged to resolve 11 claims as quickly and fairly as possible. This section is 12 available with respect to claims under personal lines and 13 commercial residential policies for all claimants and insurers 14 prior to commencing the appraisal process, or commencing 15 litigation. If requested by the insured, participation by 16 legal counsel shall be permitted. Mediation under this section 17 is also available to litigants referred to the department by a 18 county court or circuit court. This section does not apply to 19 commercial coverages, to private passenger motor vehicle 20 insurance coverages, or to disputes relating to liability 21 coverages in policies of property insurance. 22 (2) At the time a first-party claim within the scope 23 of this section is filed, the insurer shall notify all 24 first-party claimants of their right to participate in the 25 mediation program under this section. The department shall 26 prepare a consumer information pamphlet for distribution to 27 persons participating in mediation under this section. 28 (7) If the insurer fails to comply with subsection (2) 29 by failing to notify a first-party claimant of its right to 30 participate in the mediation program under this section or if 31 the insurer requests the mediation, and the mediation results 44 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 are rejected by either party, the insured shall not be 2 required to submit to or participate in any contractual loss 3 appraisal process of the property loss damage as a 4 precondition to legal action for breach of contract against 5 the insurer for its failure to pay the policyholder's claims 6 covered by the policy. 7 Section 16. Subsection (1) of section 627.702, Florida 8 Statutes, is amended to read: 9 627.702 Valued policy law.-- 10 (1)(a) In the event of the total loss of any building, 11 structure, mobile home as defined in s. 320.01(2), or 12 manufactured building as defined in s. 553.36(12), located in 13 this state and insured by any insurer as to a covered peril, 14 in the absence of any change increasing the risk without the 15 insurer's consent and in the absence of fraudulent or criminal 16 fault on the part of the insured or one acting in her or his 17 behalf, the insurer's liability, if any, under the policy for 18 such total loss, if caused by a covered peril, shall be in the 19 amount of money for which such property was so insured as 20 specified in the policy and for which a premium has been 21 charged and paid. 22 (b) The intent of this subsection is not to deprive an 23 insurer of any proper defense under the policy, to create new 24 or additional coverage under the policy, or to require an 25 insurer to pay for a loss caused by a peril other than the 26 covered peril. In furtherance of such legislative intent, when 27 a loss was caused in part by a covered peril and in part by a 28 noncovered peril, paragraph (a) does not apply. In such 29 circumstances, the insurer's liability under this section 30 shall be limited to the amount of the loss caused by the 31 covered peril. However, if the covered perils alone would have 45 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 caused the total loss, paragraph (a) shall apply. The insurer 2 is never liable for more than the amount necessary to repair, 3 rebuild, or replace the structure following the total loss, 4 after considering all other benefits actually paid for the 5 total loss. 6 (c) It is the intent of the Legislature that the 7 amendment to this section shall not be applied retroactively 8 and shall apply only to claims filed after effective date of 9 such amendment. 10 Section 17. Section 627.706, Florida Statutes, is 11 amended to read: 12 627.706 Sinkhole insurance; definitions.-- 13 (1) Every insurer authorized to transact property 14 insurance in this state shall make available coverage for 15 insurable sinkhole losses on any structure, including contents 16 of personal property contained therein, to the extent provided 17 in the form to which the sinkhole coverage attaches. 18 (2) As used in ss. 627.706-627.7074, and as used in 19 connection with any policy providing coverage for sinkhole 20 losses: 21 (a) "Sinkhole" means a landform created by subsidence 22 of soil, sediment, or rock as underlying strata are dissolved 23 by ground water. A sinkhole may form by collapse into 24 subterranean voids created by dissolution of limestone or 25 dolostone or by subsidence as these strata are dissolved. 26 (b)(2) "Sinkhole loss" means structural damage to the 27 building, including the foundation, caused by sinkhole 28 activity. Contents coverage shall apply only if there is 29 structural damage to the building caused by sinkhole activity. 30 (c)(3) "Sinkhole activity loss" means actual physical 31 damage to the property covered arising out of or caused by 46 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 sudden settlement or systematic weakening collapse of the 2 earth supporting such property only when such settlement or 3 systematic weakening collapse results from movement or 4 raveling of soils, sediments, or rock materials into 5 subterranean voids created by the effect action of water on a 6 limestone or similar rock formation. 7 (d) "Engineer" means a person, as defined in s. 8 471.005, who has a bachelor degree or higher in engineering 9 with a specialty in the geotechnical engineering field. An 10 engineer must have geotechnical experience and expertise in 11 the identification of sinkhole activity as well as other 12 potential causes of damage to the structure. 13 (e) "Professional geologist" means a person, as 14 defined by s. 492.102, who has a bachelor degree or higher in 15 geology or related earth science with expertise in the geology 16 of Florida. A professional geologist must have geological 17 experience and expertise in the identification of sinkhole 18 activity as well as other potential geologic causes of damage 19 to the structure. 20 (3)(4) Every insurer authorized to transact property 21 insurance in this state shall make a proper filing with the 22 office for the purpose of extending the appropriate forms of 23 property insurance to include coverage for insurable sinkhole 24 losses. 25 Section 18. Section 627.7065, Florida Statutes, is 26 created to read: 27 627.7065 Database of information relating to 28 sinkholes; the Department of Financial Services and the 29 Department of Environmental Protection.-- 30 (1) The Legislature finds that there has been a 31 dramatic increase in the number of sinkholes and insurance 47 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 claims for sinkhole damage in the state during the past 10 2 years. Accordingly, the Legislature recognizes the need to 3 track current and past sinkhole activity and to make the 4 information available for prevention and remediation 5 activities. The Legislature further finds that the Florida 6 Geological Survey of the Department of Environmental 7 Protection has created a partial database of some sinkholes 8 identified in Florida, although the database is not reflective 9 of all sinkholes or insurance claims for sinkhole damage. The 10 Legislature determines that creating a complete electronic 11 database of sinkhole activity serves an important purpose in 12 protecting the public and in studying property claims 13 activities in the insurance industry. 14 (2) The Department of Financial Services, including 15 the employee of the Division of Consumer Services designated 16 as the primary contact for consumers on issues relating to 17 sinkholes, and the Office of the Insurance Consumer Advocate 18 shall consult with the Florida Geological Survey and the 19 Department of Environmental Protection to implement a 20 statewide automated database of sinkholes and related activity 21 identified in the state. 22 (3) Representatives of the Department of Financial 23 Services, with the agreement of the Department of 24 Environmental Protection, shall determine the form and content 25 of the database. The content may include standards for 26 reporting and investigating sinkholes for inclusion in the 27 database and requirements for insurers to report to the 28 departments the receipt of claims involving sinkhole loss and 29 other similar activities. The Department of Financial Services 30 may require insurers to report present and past data of 31 sinkhole claims. The database also may include information of 48 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 damage due to ground settling and other subsidence activity. 2 (4) The Department of Financial Services may manage 3 the database or may contract for its management and 4 maintenance. The Department of Environmental Protection shall 5 investigate reports of sinkhole activity and include its 6 findings and investigations in the database. 7 (5) The Department of Environmental Protection, in 8 consultation with the Department of Financial Services, shall 9 present a report of activities relating to the sinkhole 10 database, including recommendations regarding the database and 11 similar matters, to the Governor, the Speaker of the House of 12 Representatives, the President of the Senate, and the Chief 13 Financial Officer by December 31, 2005. The report may 14 consider the need for the Legislature to create an entity to 15 study the increase in sinkhole activity in the state and other 16 similar issues relating to sinkhole damage, including 17 recommendations and costs for staffing the entity. The report 18 may include other information, as appropriate. 19 (6) The Department of Financial Services, in 20 consultation with the Department of Environmental Protection, 21 may adopt rules to implement this section. 22 Section 19. Section 627.707, Florida Statutes, is 23 amended to read: 24 627.707 Minimum Standards for investigation of 25 sinkhole claims by insurers; nonrenewals.-- 26 (1) Upon receipt of a claim for a sinkhole loss, an 27 insurer must meet the following minimum standards in 28 investigating a claim: 29 (1)(a) Upon receipt of a claim for a sinkhole loss, 30 The insurer must make an inspection of the insured's premises 31 to determine if there has been physical damage to the 49 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 structure which may might be the result of sinkhole activity. 2 (b) If, upon the investigation pursuant to paragraph 3 (a), the insurer discovers damage to a structure which is 4 consistent with sinkhole activity or if the structure is 5 located in close proximity to a structure in which sinkhole 6 damage has been verified, then prior to denying a claim, the 7 insurer must obtain a written certification from an individual 8 qualified to determine the existence of sinkhole activity, 9 stating that the cause of the claim is not sinkhole activity, 10 and that the analysis conducted was of sufficient scope to 11 eliminate sinkhole activity as the cause of damage within a 12 reasonable professional probability. The written certification 13 must also specify the professional discipline and professional 14 licensure or registration under which the analysis was 15 conducted. 16 (2) Following the insurer's initial inspection, the 17 insurer shall engage an engineer or a professional geologist 18 to conduct testing as provided in s. 627.7072 to determine the 19 cause of the loss within a reasonable professional probability 20 and issue a report as provided in s. 627.7073, if: 21 (a) The insurer is unable to identify a valid cause of 22 the damage or discovers damage to the structure which is 23 consistent with sinkhole loss; or 24 (b) The policyholder demands testing in accordance 25 with this section or s. 627.7072. 26 (3) Following the initial inspection of the insured 27 premises, the insurer shall provide written notice to the 28 policyholder disclosing the following information: 29 (a) What the insurer has determined to be the cause of 30 damage, if the insurer has made such a determination. 31 (b) A statement of the circumstances under which the 50 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 insurer is required to engage an engineer or a professional 2 geologist to verify or eliminate sinkhole loss and to engage 3 an engineer to make recommendations regarding land and 4 building stabilization and foundation repair. 5 (c) A statement regarding the right of the 6 policyholder to request testing by an engineer or a 7 professional geologist and the circumstances under which the 8 policyholder may demand certain testing. 9 (4) If the insurer determines that there is no 10 sinkhole loss, the insurer may deny the claim. If the insurer 11 denies the claim, without performing testing under s. 12 627.7072, the policyholder may demand testing by the insurer 13 under s. 627.7072. The policyholder's demand for testing must 14 be communicated to the insurer in writing after the 15 policyholder's receipt of the insurer's denial of the claim. 16 (5)(a) Subject to paragraph (b), if a sinkhole loss is 17 verified, the insurer shall pay to stabilize the land and 18 building and repair the foundation in accordance with the 19 recommendations of the engineer as provided under s. 627.7073, 20 and in consultation with the policyholder, subject to the 21 coverage and terms of the policy. The insurer shall pay for 22 other repairs to the structure and contents in accordance with 23 the terms of the policy. 24 (b) The insurer may limit its payment to the actual 25 cash value of the sinkhole loss, not including underpinning or 26 grouting or any other repair technique performed below the 27 existing foundation of the building, until the policyholder 28 enters into a contract for the performance of building 29 stabilization or foundation repairs. After the policyholder 30 enters into the contract, the insurer shall pay the amounts 31 necessary to begin and perform such repairs as the work is 51 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 performed and the expenses are incurred. The insurer may not 2 require the policyholder to advance payment for such repairs. 3 If repair has begun and the engineer selected or approved by 4 the insurer determines that the repair cannot be completed 5 within the policy limits, the insurer must either complete the 6 engineer's recommended repair or tender the policy limits to 7 the policyholder without a reduction for the repair expenses 8 incurred. 9 (6) Except as provided in subsection (7), the fees and 10 costs of the engineer or the professional geologist shall be 11 paid by the insurer. 12 (7)(c) If the insurer obtains, pursuant to s. 627.7073 13 paragraph (b), written certification that there is no sinkhole 14 loss or that the cause of the damage claim was not sinkhole 15 activity, and if the policyholder has submitted the sinkhole 16 claim without good faith grounds for submitting such claim, 17 the policyholder shall reimburse the insurer for 50 percent of 18 the actual costs cost of the analyses and services provided 19 analysis under ss. 627.7072 and 627.7073 paragraph (b); 20 however, a policyholder is not required to reimburse an 21 insurer more than $2,500 with respect to any claim. A 22 policyholder is required to pay reimbursement under this 23 subsection paragraph only if the insurer, prior to ordering 24 the analysis under s. 627.7072 paragraph (b), informs the 25 policyholder in writing of the policyholder's potential 26 liability for reimbursement and gives the policyholder the 27 opportunity to withdraw the claim. 28 (8)(2) No insurer shall nonrenew any policy of 29 property insurance on the basis of filing of claims for 30 partial loss caused by sinkhole damage or clay shrinkage as 31 long as the total of such payments does not exceed the current 52 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 policy limits of coverage for property damage, and provided 2 the insured has repaired the structure in accordance with the 3 engineering recommendations upon which any payment or policy 4 proceeds were based. 5 (9) The insurer may engage a structural engineer to 6 make recommendations as to the repair of the structure. 7 Section 20. Section 627.7072, Florida Statutes, is 8 created to read: 9 627.7072 Testing standards for sinkholes.-- 10 (1) The engineer and professional geologist shall 11 perform such tests as sufficient, in their professional 12 opinion, to determine the presence or absence of sinkhole loss 13 or other cause of damage within reasonable professional 14 probability and for the engineer to make recommendations 15 regarding necessary building stabilization, and foundation 16 repair. 17 (2) Testing by a professional geologist shall be 18 conducted in compliance with the Florida Geological Survey 19 Special Publication No. 57 (2005). 20 Section 21. Section 627.7073, Florida Statutes, is 21 created to read: 22 627.7073 Sinkhole reports.-- 23 (1) Upon completion of testing as provided in s. 24 627.7072, the engineer and professional geologist shall issue 25 a report and certification to the insurer and the policyholder 26 as provided in this section. 27 (a) Sinkhole loss is verified if, based upon tests 28 performed in accordance with s. 627.7072, an engineer and a 29 professional geologist issue a written report and 30 certification stating: 31 1. That the cause of the actual physical and 53 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 structural damage is sinkhole activity within a reasonable 2 professional probability. 3 2. That the analyses conducted were of sufficient 4 scope to identify sinkhole activity as the cause of damage 5 within a reasonable professional probability. 6 3. A description of the tests performed. 7 4. A recommendation by the engineer of methods for 8 stabilizing the land and building and for making repairs to 9 the foundation. 10 (b) If sinkhole activity is eliminated as the cause of 11 damage to the structure, the engineer and professional 12 geologist shall issue a written report and certification to 13 the policyholder and the insurer stating: 14 1. That the cause of the damage is not sinkhole 15 activity within a reasonable professional probability. 16 2. That the analyses and tests conducted were of 17 sufficient scope to eliminate sinkhole activity as the cause 18 of damage within a reasonable professional probability. 19 3. A statement of the cause of the damage within a 20 reasonable professional probability. 21 4. A description of the tests performed. 22 (c) The respective findings, opinions, and 23 recommendations of the engineer and professional geologist as 24 to the verification or elimination of a sinkhole loss and the 25 findings, opinions, and recommendations of the engineer as to 26 land and building stabilization and foundation repair shall be 27 presumed correct. 28 (2) Any insurer that has paid a claim for a sinkhole 29 loss shall file a copy of the report and certification, 30 prepared pursuant to subsection (1), with the county property 31 appraiser who shall record the report and certification with 54 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 the parcel number. The insurer shall bear the cost of filing 2 and recording the report and certification. There shall be no 3 cause of action or liability against an insurer for compliance 4 with this section. The seller of real property upon which a 5 sinkhole claim has been made shall disclose to the buyer of 6 such property that a claim has been paid and whether or not 7 the full amount of the proceeds were used to repair the 8 sinkhole damage. 9 Section 22. Effective October 1, 2005, and applicable 10 to policies issued or renewed on or after that date, section 11 627.711, Florida Statutes, is created to read: 12 627.711 Notice of premium discounts for hurricane loss 13 mitigation.--Using a form prescribed by the Office of 14 Insurance Regulation, the insurer shall clearly notify the 15 applicant or policyholder of any personal lines residential 16 property insurance policy, at the time of the issuance of the 17 policy and at each renewal, of the availability and the range 18 of each premium discount, credit, other rate differential, or 19 reduction in deductibles for properties on which fixtures or 20 construction techniques demonstrated to reduce the amount of 21 loss in a windstorm can or have been installed or implemented. 22 The prescribed form shall describe generally what actions the 23 policyholders may be able to take to reduce their windstorm 24 premium. The prescribed form and a list of such ranges 25 approved by the office for each insurer licensed in the state 26 and providing such discounts, credits, other rate 27 differentials, or reductions in deductibles for properties 28 described in this subsection shall be available for electronic 29 viewing and download from the Department of Financial 30 Services' or the Office of Insurance Regulation's Internet 31 website. The Financial Services Commission may adopt rules to 55 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 implement this subsection. 2 Section 23. Section 627.712, Florida Statutes, is 3 created to read: 4 627.712 Timely payment of claims.-- 5 (1) An insurer shall, within 30 days after receipt of 6 a claim under a property insurance policy: 7 (a) Pay that portion of the claim for which the 8 policyholder has submitted all information that is required 9 for payment under the terms of the policy; 10 (b) Provide a written denial to the policyholder for 11 that portion of a claim which the insurer determines is not 12 covered under the policy, including the specific reasons; and 13 (c) Specify, in writing, the additional information 14 that the policyholder must submit to the insurer in order for 15 any remaining amount of the claim to be paid. 16 (2) Within 30 days after receipt of the additional 17 information specified in paragraph (1)(c), the insurer shall 18 either pay or deny the claim as specified in paragraph (1)(a) 19 or paragraph (1)(b). 20 (3) Payment shall be considered made on the date a 21 check or other valid payment instrument is placed in the 22 United States mail in a properly addressed, postpaid envelope, 23 or if not so posted, on the date of delivery. 24 (4) All overdue payments shall bear simple interest at 25 the rate of 10 percent per year. 26 (5) Following a hurricane or natural disaster, the 27 requirements of this section are subject to such exceptions or 28 alternative requirements as may be provided by rule of the 29 commission or order of the office. 30 Section 24. The Office of Insurance Regulation shall, 31 by January 1, 2006, submit a report to the President of the 56 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 Senate, the Speaker of the House of Representatives, the 2 minority party leaders of the Senate and the House of 3 Representatives, and the chairs of the standing committees of 4 the Senate and the House of Representatives having 5 jurisdiction over matters relating to property and casualty 6 insurance. The report shall include findings and 7 recommendations on requiring residential property insurers to 8 provide law and ordinance coverage for residential property 9 insurance policies, the increase or decrease in insurance 10 costs associated with requiring such coverage, and such other 11 related information as the Office of Insurance Regulation 12 determines is appropriate for the Legislature to consider. 13 Section 25. Notwithstanding that revenues of Citizens 14 Property Insurance Corporation are not state revenues, the 15 Auditor General shall perform an operational audit, as defined 16 in section 11.45(1), Florida Statutes, of the Citizens 17 Property Insurance Corporation created under section 18 627.351(6), Florida Statutes. The scope of the audit shall 19 also include: 20 (1) An analysis of the corporation's infrastructure, 21 customer service, claims handling, accessibility of 22 policyholder information to the agent of record, take-out 23 programs, take-out bonuses, and financing arrangements. 24 (2) An evaluation of costs associated with the 25 administration and servicing of the policies issued by the 26 corporation to determine alternatives by which costs can be 27 reduced, customer service improved, and claims handling 28 improved. 29 30 The audit shall contain policy alternatives for the 31 Legislature to consider. The Auditor General shall submit a 57 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 report to the Governor, the President of the Senate, and the 2 Speaker of the House of Representatives no later than February 3 1, 2006. 4 Section 26. The board of governors of the Citizens 5 Property Insurance Corporation created under section 6 627.351(6), Florida Statutes, shall, by February 1, 2006, 7 submit a report to the President of the Senate, the Speaker of 8 the House of Representatives, the minority party leaders of 9 the Senate and the House of Representatives, and the chairs of 10 the standing committees of the Senate and the House of 11 Representatives having jurisdiction over matters relating to 12 property and casualty insurance. The report shall include the 13 board's findings and recommendations on the following issues: 14 (1) The number of policies and the aggregate premium 15 of the Citizens Property Insurance Corporation, before and 16 after enactment of this act, and projections for future policy 17 and premium growth. 18 (2) Increases or decreases in availability of 19 residential property coverage in the voluntary market and the 20 effectiveness of this act in improving the availability of 21 residential property coverage in the voluntary market in the 22 state. 23 (3) The board's efforts to depopulate the corporation 24 and the willingness of insurers in the voluntary market to 25 avail themselves of depopulation incentives. 26 (4) Further actions that could be taken by the 27 Legislature to improve availability of residential property 28 coverage in the voluntary and residual markets. 29 (5) Actions that the board has taken to restructure 30 the corporation and recommendations for legislative action to 31 restructure the corporation, including, but not limited to, 58 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 actions relating to claims handling and customer service. 2 (6) Projected surpluses or deficits and possible means 3 of providing funding to ensure the continued solvency of the 4 corporation. 5 (7) The corporation's efforts to procure catastrophe 6 reinsurance to cover its projected 100-year probable maximum 7 loss with specification as to what best efforts were made by 8 the corporation to procure such reinsurance. 9 (8) Such other issues as the board determines are 10 worthy of the Legislature's consideration. 11 Section 27. For the 2005-2006 fiscal year, there is 12 appropriated $350,000 in recurring funds from the Insurance 13 Regulatory Trust Fund and four positions are authorized to the 14 Office of the Consumer Advocate within the Department of 15 Financial Services for the purposes provided in section 16 627.0613, Florida Statutes. 17 Section 28. The amendment to section 627.0628, Florida 18 Statutes, and the creation of section 627.06281, Florida 19 Statutes, as provided in this act shall take effect on the 20 same date that House Bill 1939, Senate Bill 1478, or similar 21 legislation takes effect, if such legislation is adopted in 22 the same legislative session or an extension thereof and 23 becomes a law. 24 Section 29. Except as otherwise expressly provided in 25 this act, this act shall take effect upon becoming a law. 26 27 28 ================ T I T L E A M E N D M E N T =============== 29 And the title is amended as follows: 30 Delete everything before the enacting clause 31 59 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 and insert: 2 A bill to be entitled 3 An act relating to property insurance; amending 4 s. 215.555, F.S.; revising the retention of 5 losses for which an insurer is not entitled to 6 reimbursement from the Florida Hurricane 7 Catastrophe Fund; amending s. 215.559, F.S.; 8 revising the allocation of funds appropriated 9 to the Department of Community Affairs from the 10 Florida Hurricane Catastrophe Fund for the 11 Hurricane Loss Mitigation Program; requiring 12 that the department establish a low-interest 13 loan program and pilot project for hurricane 14 loss mitigation; authorizing contractual 15 agreements between the department and financial 16 institutions; authorizing the Department of 17 Community Affairs to adopt rules; amending s. 18 627.062, F.S.; requiring the Office of 19 Insurance Regulation to submit a proposed plan 20 to the Legislature establishing uniform rating 21 territories to be used by insurers for 22 residential property insurance rate filings; 23 requiring a further act of the Legislature to 24 implement the plan; limiting the recoupment by 25 an insurer in its rates of the reimbursement 26 premium it pays to the Florida Hurricane 27 Catastrophe Fund; amending s. 627.0628, F.S.; 28 restricting the admissibility and relevance in 29 rate proceedings of findings of the Florida 30 Commission on Hurricane Loss Projection 31 Methodology; amending s. 627.0629, F.S.; 60 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 lowering the percentage amount of a rate filing 2 based on a computer model which requires a 3 public hearing; creating s. 627.06281, F.S.; 4 requiring residential property insurers and 5 rating and advisory organizations to report 6 hurricane loss data for development of a public 7 hurricane model for hurricane loss projections; 8 amending s. 627.351, F.S.; revising the 9 appointments to the board and the approval of 10 officers and employees of the corporation; 11 providing additional legislative intent 12 relating to the Citizens Property Insurance 13 Corporation; authorizing the corporation to 14 issue bonds and incur indebtedness for certain 15 purposes; requiring creation of a Market 16 Accountability Advisory Committee to assist the 17 corporation for certain purposes; providing for 18 appointment of committee members; providing for 19 terms; requiring reports to the corporation; 20 revising requirements for the plan of operation 21 of the corporation; requiring the corporation 22 to require the securing of flood insurance as a 23 condition of coverage under certain 24 circumstances; providing requirements and 25 limitations; creating s. 627.40951, F.S.; 26 providing legislative findings and intent; 27 providing for an advisory committee; providing 28 for membership; providing for recommendations 29 to be submitted to the Legislature regarding 30 standard residential property insurance 31 policies; amending s. 627.411, F.S.; adding 61 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 grounds for which the Office of Insurance 2 Regulation must disapprove a form filed by an 3 insurer; amending s. 627.4133, F.S.; 4 prohibiting insurers from canceling or 5 nonrenewing residential property insurance 6 policies under certain emergency circumstances; 7 providing exceptions; providing notice 8 requirements; providing application to personal 9 residential and commercial residential policies 10 covering certain damaged property; extending 11 the effective date of certain policies under 12 certain hurricane circumstances; authorizing 13 the insurer to collect premiums for the 14 extended period; providing nonapplication; 15 amending s. 627.4143, F.S.; requiring insurers 16 to provide personal lines property insurance 17 policyholders with a checklist of items 18 contained in policies; authorizing the 19 Financial Services Commission to adopt rules; 20 prescribing elements to be contained in the 21 checklist; requiring the checklist and outline 22 of insurance coverage to be sent with each 23 renewal; clarifying that homeowners' insurance 24 includes mobile homeowners', dwelling, and 25 condominium unit owners' insurance for purposes 26 of the outline of coverage; amending s. 27 627.701, F.S.; increasing the maximum allowable 28 hurricane deductible for personal lines and 29 certain commercial lines residential policies; 30 requiring insurers to offer specified hurricane 31 deductibles for such policies; requiring 62 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 insurers to provide written notice explaining 2 hurricane deductible options for such policies; 3 providing for computation and display of the 4 dollar value of hurricane deductibles; 5 requiring insurers to compute and display 6 actual dollar values of certain riders for 7 certain policies; amending s. 627.701, F.S.; 8 providing that the requirement for a hurricane 9 deductible to apply on an annual basis applies 10 to personal lines residential property 11 insurance policies; requiring insurers that 12 provide commercial residential property 13 insurance to offer alternative hurricane 14 deductibles that apply on an annual basis or to 15 each hurricane; amending s. 627.7011, F.S.; 16 requiring insurers to offer coverage for 17 additional costs of repair due to laws and 18 ordinances; requiring insurers to pay the 19 replacement cost for a loss insured on that 20 basis, whether or not the insured replaces or 21 repairs the dwelling or property; requiring 22 certain homeowner's insurance policies to 23 contain a specified statement; providing 24 intent; amending s. 627.7015, F.S.; revising 25 purpose and scope provisions relating to an 26 alternative procedure for resolution of 27 disputed property insurance claims; providing 28 that failure of an insurer to notify a claimant 29 of the availability of mediation excuses an 30 insured from being required to submit to 31 certain loss appraisal processes; amending s. 63 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 627.702, F.S.; providing legislative intent 2 regarding the requirement that an insurer pay 3 policy limits if there is a total loss of a 4 building; providing nonapplication of certain 5 insurer liability requirements under certain 6 circumstances; limiting an insurer's liability 7 to certain loss covered by a covered peril; 8 amending s. 627.706, F.S., relating to sinkhole 9 insurance; providing definitions; creating s. 10 627.7065, F.S.; providing legislative findings; 11 requiring the Department of Financial Services 12 and the Office of the Insurance Consumer 13 Advocate to consult with the Florida Geological 14 Survey and the Department of Environmental 15 Protection to implement a statewide automated 16 database of sinkholes and related activity; 17 providing requirements for the form and content 18 of the database; authorizing the Department of 19 Financial Services to require insurers to 20 provide certain information; providing for 21 management of the database; requiring the 22 department to investigate sinkhole activity 23 reports and include findings and investigations 24 in the database; requiring the Department of 25 Environmental Protection to report on the 26 database to the Governor, Legislature, and 27 Chief Financial Officer; authorizing the 28 Department of Financial Services to adopt 29 implementing rules; amending s. 627.707, F.S.; 30 revising standards for investigations of 31 sinkhole claims by insurers; requiring an 64 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 insurer to engage an engineer or professional 2 geologist for certain purposes; requiring a 3 report under certain circumstances; requiring 4 an insurer to provide written notice to a 5 policyholder disclosing certain information; 6 authorizing an insurer to deny a claim under 7 certain circumstances; authorizing a 8 policyholder to demand certain testing; 9 providing requirements; specifying required 10 activities for insurers if a sinkhole loss is 11 verified; specifying payment requirements for 12 insurers; providing limitations; requiring the 13 insurer to pay fees of the engineer and 14 geologist; authorizing an insurer to engage a 15 structural engineer for certain purposes; 16 creating s. 627.7072, F.S.; specifying 17 requirements for sinkhole testing by engineers 18 and geologists; creating s. 627.7073, F.S.; 19 providing reporting requirements for engineers 20 and geologists after testing for sinkholes; 21 specifying a presumption of correctness of 22 certain findings; requiring an insurer paying a 23 sinkhole loss claim to file a report and 24 certification with the county property 25 appraiser; requiring the property appraiser to 26 record the report and certification; requiring 27 the insurer to bear the cost of filing and 28 recording; requiring a seller of certain 29 property to make certain disclosures to 30 property buyers under certain circumstances; 31 creating s. 627.711, F.S.; requiring insurers 65 11:23 PM 05/05/05 h193704e2c-40-j01
Florida Senate - 2005 SENATOR AMENDMENT Bill No. HB 1937, 2nd Eng. Barcode 435620 1 to notify applicants or policyholders of the 2 availability and amounts of certain discounts, 3 credits, rate differentials, or reductions in 4 deductibles for properties on which certain 5 fixtures have been installed or construction 6 techniques have been implemented; requiring 7 insurers to provide qualifying information; 8 authorizing the Financial Services Commission 9 to adopt rules; creating s. 627.712, F.S.; 10 requiring property insurers to pay or deny 11 claims within certain time periods; providing 12 that overdue payments bear interest; requiring 13 the Office of Insurance Regulation to submit a 14 report to the Legislature relating to 15 residential property insurance; providing 16 report requirements; requiring the Office of 17 the Auditor General to conduct an operational 18 audit of Citizens Property Insurance 19 Corporation; specifying audit requirements; 20 requiring a report; requiring the board of 21 governors of the Citizens Property Insurance 22 Corporation to submit a report to the 23 Legislature relating to property and casualty 24 insurance; specifying report requirements; 25 providing an appropriation and authorizing 26 positions; providing a contingent effective 27 date; providing effective dates. 28 29 30 31 66 11:23 PM 05/05/05 h193704e2c-40-j01
Site Map
Session:   Bills ·   Calendars ·   Bound Journals ·   Citator ·   Search ·   Appropriations ·   Redistricting ·   Bill Information Reports
Committee Publications
Historical Information
Statutes:   Introduction ·   View Statutes ·   Search Statutes
Flsenate.gov
Disclaimer: The information on this system is unverified. The journals or printed bills of the respective chambers should be consulted for official purposes.    Copyright © 2000-2020 State of Florida.     Privacy Statement     Contact Us     Get Acrobat Reader