October 19, 2019
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439287
  Amendment
Bill No. CS/CS/SB 2860
Amendment No. 439287
CHAMBER ACTION
Senate House
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1Representatives Ross and Reagan offered the following:
2
3     Amendment (with title amendment)
4     Remove everything after the enacting clause and insert:
5
6     Section 1.  Section 215.5595, Florida Statutes, is amended
7to read:
8     215.5595  Insurance Capital Build-Up Incentive Program.--
9     (1)  Upon entering the 2008 2006 hurricane season, the
10Legislature finds that:
11     (a)  The losses in this state Florida from eight hurricanes
12in 2004 and 2005 have seriously strained the resources of both
13the voluntary insurance market and the public sector mechanisms
14of Citizens Property Insurance Corporation and the Florida
15Hurricane Catastrophe Fund.
16     (b)  Private reinsurance is much less available and at a
17significantly greater cost to residential property insurers as
18compared to 1 year ago, particularly for amounts below the
19insurer's retention or retained losses that must be paid before
20reimbursement is provided by the Florida Hurricane Catastrophe
21Fund.
22     (c)  The Office of Insurance Regulation has reported that
23the insolvency of certain insurers may be imminent.
24     (d)  Hurricane forecast experts predict that the 2006
25hurricane season will be an active hurricane season and that the
26Atlantic and Gulf Coast regions face an active hurricane cycle
27of 10 to 20 years or longer.
28     (b)(e)  Citizens Property Insurance Corporation has over
291.2 million policies in force, has the largest market share of
30any insurer writing residential property insurer in the state,
31and faces the threat of a catastrophic loss that The number of
32cancellations or nonrenewals of residential property insurance
33policies is expected to increase and the number of new
34residential policies written in the voluntary market are likely
35to decrease, causing increased policy growth and exposure to the
36state insurer of last resort, Citizens Property Insurance
37Corporation, and threatening to increase the deficit of the
38corporation, currently estimated to be over $1.7 billion. This
39deficit must be funded by assessments against insurers and
40policyholders, unless otherwise funded by the state. The program
41has a substantial positive effect on the depopulation efforts of
42Citizens Property Insurance Corporation since companies
43participating in the program have removed over 199,000 policies
44from the corporation. Companies participating in the program
45have issued a significant number of new policies, thereby
46keeping an estimated 480,000 new policies out of the
47corporation.
48     (c)(f)  Policyholders are subject to high increased
49premiums and assessments that are increasingly making such
50coverage unaffordable and that may force policyholders to sell
51their homes and even leave the state.
52     (d)(g)  The increased risk to the public sector and private
53sector continues to pose poses a serious threat to the economy
54of this state, particularly the building and financing of
55residential structures, and existing mortgages may be placed in
56default.
57     (h)  The losses from 2004 and 2005, combined with the
58expectation that the increase in hurricane activity will
59continue for the foreseeable future, have caused both insurers
60and reinsurers to limit the capital they are willing to commit
61to covering the hurricane risk in Florida; attracting new
62capital to the Florida market is a critical priority; and
63providing a low-cost source of capital would enable insurers to
64write additional residential property insurance coverage and act
65to mitigate premium increases.
66     (e)(i)  Appropriating state funds to be exchanged for used
67as surplus notes issued by for residential property insurers,
68under conditions requiring the insurer to contribute additional
69private sector capital and to write a minimum level of premiums
70for residential hurricane coverage, is a valid and important
71public purpose.
72     (f)  Extending the Insurance Capital Build-up Incentive
73Program will provide an incentive for investors to commit
74additional capital to Florida's residential insurance market.
75     (2)  The purpose of this section is to provide funds in
76exchange for surplus notes to be issued by to new or existing
77authorized residential property insurers under the Insurance
78Capital Build-Up Incentive Program administered by the State
79Board of Administration, under the following conditions:
80     (a)  The amount of state funds provided in exchange for a
81the surplus note to for any insurer or insurer group, other than
82an insurer writing only manufactured housing policies, may not
83exceed $25 million or 20 percent of the total amount of funds
84appropriated for available under the program, whichever is
85greater. The amount of the surplus note for any insurer or
86insurer group writing residential property insurance covering
87only manufactured housing may not exceed $7 million.
88     (b)  On or after April 1, 2008, the insurer must contribute
89an amount of new capital to its surplus which is at least equal
90to the amount of the surplus note and must apply to the board by
91September 1, 2008 July 1, 2006. If an insurer applies after
92September 1, 2008 July 1, 2006, but before June 1, 2009 2007,
93the amount of the surplus note is limited to one-half of the new
94capital that the insurer contributes to its surplus, except that
95an insurer writing only manufactured housing policies is
96eligible to receive a surplus note of up to $7 million. For
97purposes of this section, new capital must be in the form of
98cash or cash equivalents as specified in s. 625.012(1).
99     (c)  The insurer's surplus, new capital, and the surplus
100note must total at least $50 million, except for insurers
101writing residential property insurance covering only
102manufactured housing. The insurer's surplus, new capital, and
103the surplus note must total at least $14 million for insurers
104writing only residential property insurance covering
105manufactured housing policies as provided in paragraph (a).
106     (d)  The insurer must commit to increase its writings of
107residential property insurance, including the peril of wind, and
108to meet meeting a minimum writing ratio of net written premium
109to surplus of at least 1:1 for the first calendar year after
110receiving the state funds or renegotiation of the surplus note,
1111.5:1 for the second calendar year, and 2:1 for the remaining
112term of the surplus note. Alternatively, the insurer must meet a
113minimum writing ratio of gross written premium to surplus of at
114least 3:1 for the first calendar year after receiving the state
115funds or renegotiation of the surplus note, 4.5:1 for the second
116calendar year, and 6:1 for the remaining term of the surplus
117note. The writing ratios, which shall be determined by the
118Office of Insurance Regulation and certified quarterly to the
119board. For this purpose, the term "premium" "net written
120premium" means net written premium for residential property
121insurance in this state Florida, including the peril of wind,
122and "surplus" means the new capital and surplus note refers to
123the entire surplus of the insurer. An insurer that makes an
124initial application after July 1, 2008, must also commit to
125writing at least 15 percent of its net or gross written premium
126for new policies, not including renewal premiums, for policies
127taken out of Citizens Property Insurance Corporation, during
128each of the first 3 years after receiving the state funds in
129exchange for the surplus note, which shall be determined by the
130Office of Insurance Regulation and certified annually to the
131board. The office may determine that an insurer meets the
132requirement for taking policies out the corporation, by written
133notice to the board, upon a finding that the insurer made offers
134of coverage to policyholders of the corporation which would have
135resulted in meeting this requirement had the policyholders
136accepted the offer. The insurer must also commit to maintaining
137a level of surplus and reinsurance sufficient to cover in excess
138of its 1-in-100 year probable maximum loss, as determined by a
139hurricane loss model accepted by the Florida Commission on
140Hurricane Loss Projection Methodology, which shall be determined
141by the Office of Insurance Regulation and certified annually to
142the board. If the board determines that the insurer has failed
143to meet any of the requirements of this paragraph required ratio
144is not maintained during the term of the surplus note, the board
145may increase the interest rate, accelerate the repayment of
146interest and principal, or shorten the term of the surplus note,
147subject to approval by the Commissioner of Insurance of payments
148by the insurer of principal and interest as provided in
149paragraph (f).
150     (e)  If the requirements of this section are met, the board
151may approve an application by an insurer for funds in exchange
152for issuance of a surplus note, unless the board determines that
153the financial condition of the insurer and its business plan for
154writing residential property insurance in Florida places an
155unreasonably high level of financial risk to the state of
156nonpayment in full of the interest and principal. The board
157shall consult with the Office of Insurance Regulation and may
158contract with independent financial and insurance consultants in
159making this determination.
160     (f)  The surplus note must be repayable to the state with a
161term of 20 years. The surplus note shall accrue interest on the
162unpaid principal balance at a rate equivalent to the 10-year
163U.S. Treasury Bond rate, require the payment only of interest
164during the first 3 years, and include such other terms as
165approved by the board. The board may charge late fees up to 5
166percent for late payments or other late remittances. Payment of
167principal, or interest, or late fees by the insurer on the
168surplus note must be approved by the Commissioner of Insurance,
169who shall approve such payment unless the commissioner
170determines that such payment will substantially impair the
171financial condition of the insurer. If such a determination is
172made, the commissioner shall approve such payment that will not
173substantially impair the financial condition of the insurer.
174     (g)  The total amount of funds available for the program is
175limited to the amount appropriated by the Legislature for this
176purpose. If the amount of surplus notes requested by insurers
177exceeds the amount of funds available, the board may prioritize
178insurers that are eligible and approved, with priority for
179funding given to insurers writing only manufactured housing
180policies, regardless of the date of application, based on the
181financial strength of the insurer, the viability of its proposed
182business plan for writing additional residential property
183insurance in the state, and the effect on competition in the
184residential property insurance market. Between insurers writing
185residential property insurance covering manufactured housing,
186priority shall be given to the insurer writing the highest
187percentage of its policies covering manufactured housing.
188     (h)  The board may allocate portions of the funds available
189for the program and establish dates for insurers to apply for
190surplus notes from such allocation which are earlier than the
191dates established in paragraph (b).
192     (h)(i)  Notwithstanding paragraph (d), a newly formed
193manufactured housing insurer that is eligible for a surplus note
194under this section shall meet the premium to surplus ratio
195provisions of s. 624.4095.
196     (i)(j)  As used in this section, "an insurer writing only
197manufactured housing policies" includes:
198     1.  A Florida domiciled insurer that begins writing
199personal lines residential manufactured housing policies in
200Florida after March 1, 2007, and that removes a minimum of
20150,000 policies from Citizens Property Insurance Corporation
202without accepting a bonus, provided at least 25 percent of its
203policies cover manufactured housing. Such an insurer may count
204any funds above the minimum capital and surplus requirement that
205were contributed into the insurer after March 1, 2007, as new
206capital under this section.
207     2.  A Florida domiciled insurer that writes at least 40
208percent of its policies covering manufactured housing in
209Florida.
210     (3)  As used in this section, the term:
211     (a)  "Board" means the State Board of Administration.
212     (b)  "Program" means the Insurance Capital Build-Up
213Incentive Program established by this section.
214     (4)  The state funds provided to the insurer in exchange
215for the A surplus note provided to an insurer pursuant to this
216section are is considered borrowed surplus an asset of the
217insurer pursuant to s. 628.401 s. 625.012.
218     (5)  If an insurer that receives funds in exchange for
219issuance of a surplus note pursuant to this section is rendered
220insolvent, the state is a class 3 creditor pursuant to s.
221631.271 for the unpaid principal and interest on the surplus
222note.
223     (6)  The board shall adopt rules prescribing the
224procedures, administration, and criteria for approving the
225applications of insurers to receive funds in exchange for
226issuance of surplus notes pursuant to this section, which may be
227adopted pursuant to the procedures for emergency rules of
228chapter 120. Otherwise, actions and determinations by the board
229pursuant to this section are exempt from chapter 120.
230     (7)  The board shall invest and reinvest the funds
231appropriated for the program in accordance with s. 215.47 and
232consistent with board policy.
233     (8)  Costs and fees incurred by the board in administering
234this program, including fees for investment services, shall be
235paid from funds appropriated by the Legislature for this
236program, but are limited to 1 percent of the amount
237appropriated.
238     (9)  The board shall submit a report to the President of
239the Senate and the Speaker of the House of Representatives by
240February 1 of each year as to the results of the program and
241each insurer's compliance with the terms of its surplus note.
242     (10)  The amendments to this section enacted in 2008 do not
243affect the terms or conditions of the surplus notes that were
244approved prior to January 1, 2008. However, the board may
245renegotiate the terms of any surplus note issued by an insurer
246prior to January 2008 under this program upon the agreement of
247the insurer and the board and consistent with the requirements
248of this section as amended in 2008.
249     Section 2.  Subsection (6) is added to section 624.3161,
250Florida Statutes, to read:
251     624.3161  Market conduct examinations.--
252     (6)  Based on the findings of a market conduct examination
253that an insurer has exhibited a pattern or practice of willful
254violations of an unfair insurance trade practice related to
255claims-handling which caused harm to policyholders, as
256prohibited by s. 626.9541(1)(i), the office, after a proceeding
257under ss. 120.569 and 120.57(1), may require an insurer to file
258its claims-handling practices and procedures related to that
259line of insurance with the office for review and inspection, to
260be held by the office for the following 36-month period. Such
261claims-handling practices and procedures are public records and
262are not trade secrets or otherwise exempt from the provisions of
263s. 119.07(1). As used in this section, "claims-handling
264practices and procedures" are any policies, guidelines, rules,
265protocols, standard operating procedures, instructions, or
266directives that govern or guide how and the manner in which an
267insured's claims for benefits under any policy will be
268processed.
269     Section 3.  Subsections (2) and (3) of section 624.4211,
270Florida Statutes, are amended to read:
271     624.4211  Administrative fine in lieu of suspension or
272revocation.--
273     (2)  With respect to any nonwillful violation, such fine
274may shall not exceed $5,000 $2,500 per violation. In no event
275shall such fine exceed an aggregate amount of $20,000 $10,000
276for all nonwillful violations arising out of the same action. If
277When an insurer discovers a nonwillful violation, the insurer
278shall correct the violation and, if restitution is due, make
279restitution to all affected persons. Such restitution shall
280include interest at 12 percent per year from either the date of
281the violation or the date of inception of the affected person's
282policy, at the insurer's option. The restitution may be a credit
283against future premiums due provided that the interest
284accumulates shall accumulate until the premiums are due. If the
285amount of restitution due to any person is $50 or more and the
286insurer wishes to credit it against future premiums, it shall
287notify such person that she or he may receive a check instead of
288a credit. If the credit is on a policy that which is not
289renewed, the insurer shall pay the restitution to the person to
290whom it is due.
291     (3)  With respect to any knowing and willful violation of a
292lawful order or rule of the office or commission or a provision
293of this code, the office may impose a fine upon the insurer in
294an amount not to exceed $40,000 $20,000 for each such violation.
295In no event shall such fine exceed an aggregate amount of
296$200,000 $100,000 for all knowing and willful violations arising
297out of the same action. In addition to such fines, the such
298insurer shall make restitution when due in accordance with the
299provisions of subsection (2).
300     Section 4.  Section 624.4213, Florida Statutes, is created
301to read:
302     624.4213  Trade secret documents.--
303     (1)  If any person who is required to submit documents or
304other information to the office or department pursuant to the
305Insurance Code or by rule or order of the office, department, or
306commission claims that such submission contains a trade secret,
307such person may file with the office or department a notice of
308trade secret as provided in this section. Failure to do so
309constitutes a waiver of any claim by such person that the
310document or information is a trade secret.
311     (a)  Each page of such document or specific portion of a
312document claimed to be a trade secret must be clearly marked as
313"trade secret."
314     (b)  All material marked as a trade secret must be
315separated from all non-trade secret material, such as being
316submitted in a separate envelope clearly marked as "trade
317secret."
318     (c)  In submitting a notice of trade secret to the office
319or department, the submitting party must include an affidavit
320certifying under oath to the truth of the following statements
321concerning all documents or information that are claimed to be
322trade secrets:
323     1.  [I consider/My company considers] this information a
324trade secret that has value and provides an advantage or an
325opportunity to obtain an advantage over those who do not know or
326use it.
327     2.  [I have/My company has] taken measures to prevent the
328disclosure of the information to anyone other that those who
329have been selected to have access for limited purposes, and [I
330intend/my company intends] to continue to take such measures.
331     3.  The information is not, and has not been, reasonably
332obtainable without [my/our] consent by other persons by use of
333legitimate means.
334     4.  The information is not publicly available elsewhere.
335     (2)  If the office or department receives a public-records
336request for a document or information that is marked and
337certified as a trade secret, the office or department shall
338promptly notify the person that certified the document as a
339trade secret. The notice shall inform such person that he or she
340or his or her company has 30 days following receipt of such
341notice to file an action in circuit court seeking a
342determination whether the document in question contains trade
343secrets and an order barring public disclosure of the document.
344If that person or company files an action within 30 days after
345receipt of notice of the public-records request, the office or
346department may not release the documents pending the outcome of
347the legal action. The failure to file an action within 30 days
348constitutes a waiver of any claim of confidentiality and the
349office or department shall release the document as requested.
350     (3)  The office or department may disclose a trade secret,
351together with the claim that it is a trade secret, to an officer
352or employee of another governmental agency whose use of the
353trade secret is within the scope of his or her employment.
354     Section 5. Section 624.4305, Florida Statutes, is created
355to read:
356     624.4305  Nonrenewal of residential property insurance
357policies.--Any insurer planning to nonrenew more than 10,000
358residential property insurance policies in this state within a
35912-month period shall give notice in writing to the Office of
360Insurance Regulation for informational purposes 90 days before
361the issuance of any notices of nonrenewal. The notice provided
362to the office must set forth the insurer's reasons for such
363action, the effective dates of nonrenewal, and any arrangements
364made for other insurers to offer coverage to affected
365policyholders.
366     Section 6.  Subsection (2) of section 626.9521, Florida
367Statutes, is amended to read:
368     626.9521  Unfair methods of competition and unfair or
369deceptive acts or practices prohibited; penalties.--
370     (2)  Any person who violates any provision of this part
371shall be subject to a fine in an amount not greater than $5,000
372$2,500 for each nonwillful violation and not greater than
373$40,000 $20,000 for each willful violation. Fines under this
374subsection imposed against an insurer may not exceed an
375aggregate amount of $20,000 $10,000 for all nonwillful
376violations arising out of the same action or an aggregate amount
377of $200,000 $100,000 for all willful violations arising out of
378the same action. The fines authorized by this subsection may be
379imposed in addition to any other applicable penalty.
380     Section 7.  Section 627.0612, Florida Statutes, is amended
381to read:
382     627.0612  Administrative proceedings in rating
383determinations.--     
384     (1)  In any proceeding to determine whether rates, rating
385plans, or other matters governed by this part comply with the
386law, the appellate court shall set aside a final order of the
387office if the office has violated s. 120.57(1)(k) by
388substituting its findings of fact for findings of an
389administrative law judge which were supported by competent
390substantial evidence.
391     (2)  In an administrative hearing to determine whether an
392insurer's rates, rating schedules, rating manuals, premium
393credits, discount schedules, surcharge schedules, or changes
394thereto, for property insurance comply with the law, in addition
395to any other findings of fact, findings on the following matters
396shall be considered findings of fact:
397     (a)  Whether a factor or factors used in a rate filing or
398applied by the office is consistent with standard actuarial
399techniques or practices or are otherwise based on reasonable
400actuarial judgment.
401     (b)  Whether a factor for underwriting profit and
402contingencies is reasonable or excessive.
403     (c)  Whether the cost of reinsurance is reasonable or
404excessive.
405     (d)  Whether a factor or factors used in a rate filing or
406applied by the office demonstrate that a rate is excessive,
407inadequate or unfairly discriminatory.
408     (3)  In an administrative hearing to determine whether an
409insurer's rates, rating schedules, rating manuals, premium
410credits, discount schedules, surcharge schedules, or changes
411thereto, for property insurance comply with the law, an order
412may be entered that approves, modifies, or rejects the requested
413change.  An order modifying the requested rate change shall
414recommend such change as is supported by the record in the case.
415     Section 8.  Paragraphs (a), (b), and (g) of subsection
416(2),subsection (6), and paragraph (a) of subsection (9) of
417section 627.062, Florida Statutes, are amended to read:
418     627.062  Rate standards.--
419     (2)  As to all such classes of insurance:
420     (a)  Insurers or rating organizations shall establish and
421use rates, rating schedules, or rating manuals to allow the
422insurer a reasonable rate of return on such classes of insurance
423written in this state. A copy of rates, rating schedules, rating
424manuals, premium credits or discount schedules, and surcharge
425schedules, and changes thereto, shall be filed with the office
426under one of the following procedures except as provided in
427subparagraph 3.:
428     1.  If the filing is made at least 90 days before the
429proposed effective date and the filing is not implemented during
430the office's review of the filing and any proceeding and
431judicial review, then such filing shall be considered a "file
432and use" filing. In such case, the office shall finalize its
433review by issuance of a notice of intent to approve or a notice
434of intent to disapprove within 90 days after receipt of the
435filing. The notice of intent to approve and the notice of intent
436to disapprove constitute agency action for purposes of the
437Administrative Procedure Act. Requests for supporting
438information, requests for mathematical or mechanical
439corrections, or notification to the insurer by the office of its
440preliminary findings shall not toll the 90-day period during any
441such proceedings and subsequent judicial review. The rate shall
442be deemed approved if the office does not issue a notice of
443intent to approve or a notice of intent to disapprove within 90
444days after receipt of the filing.
445     2.  If the filing is not made in accordance with the
446provisions of subparagraph 1., such filing shall be made as soon
447as practicable, but no later than 30 days after the effective
448date, and shall be considered a "use and file" filing. An
449insurer making a "use and file" filing is potentially subject to
450an order by the office to return to policyholders portions of
451rates found to be excessive, as provided in paragraph (h).
452     3.  For all filings made or submitted after January 25,
4532007, but before December 31, 2008, an insurer seeking a rate
454that is greater than the rate most recently approved by the
455office shall make a "file and use" filing. This subparagraph
456applies to property insurance only. For purposes of this
457subparagraph, motor vehicle collision and comprehensive
458coverages are not considered to be property coverages.
459     (b)  Upon receiving a rate filing, the office shall review
460the rate filing to determine if a rate is excessive, inadequate,
461or unfairly discriminatory. In making that determination, the
462office shall, in accordance with generally accepted and
463reasonable actuarial techniques, consider the following factors:
464     1.  Past and prospective loss experience within and without
465this state.
466     2.  Past and prospective expenses.
467     3.  The degree of competition among insurers for the risk
468insured.
469     4.  Investment income reasonably expected by the insurer,
470consistent with the insurer's investment practices, from
471investable premiums anticipated in the filing, plus any other
472expected income from currently invested assets representing the
473amount expected on unearned premium reserves and loss reserves.
474The commission may adopt rules using utilizing reasonable
475techniques of actuarial science and economics to specify the
476manner in which insurers shall calculate investment income
477attributable to such classes of insurance written in this state
478and the manner in which such investment income shall be used to
479calculate in the calculation of insurance rates. Such manner
480shall contemplate allowances for an underwriting profit factor
481and full consideration of investment income which produce a
482reasonable rate of return; however, investment income from
483invested surplus may shall not be considered.
484     5.  The reasonableness of the judgment reflected in the
485filing.
486     6.  Dividends, savings, or unabsorbed premium deposits
487allowed or returned to Florida policyholders, members, or
488subscribers.
489     7.  The adequacy of loss reserves.
490     8.  The cost of reinsurance. The office shall not
491disapprove a rate as excessive solely due to the insurer having
492obtained catastrophic reinsurance to cover the insurer's
493estimated 250-year probable maximum loss or any lower level of
494loss.
495     9.  Trend factors, including trends in actual losses per
496insured unit for the insurer making the filing.
497     10.  Conflagration and catastrophe hazards, if applicable.
498     11.  Projected hurricane losses, if applicable, which must
499be estimated using a model or method found to be acceptable or
500reliable by the Florida Commission on Hurricane Loss Projection
501Methodology, and as further provided in s. 627.0628.
502     12.11.  A reasonable margin for underwriting profit and
503contingencies. For that portion of the rate covering the risk of
504hurricanes and other catastrophic losses for which the insurer
505has not purchased reinsurance and has exposed its capital and
506surplus to such risk, the office must approve a rating factor
507that provides the insurer a reasonable rate of return that is
508commensurate with such risk.
509     13.12.  The cost of medical services, if applicable.
510     14.13.  Other relevant factors which impact upon the
511frequency or severity of claims or upon expenses.
512     (g)  The office may at any time review a rate, rating
513schedule, rating manual, or rate change; the pertinent records
514of the insurer; and market conditions. If the office finds on a
515preliminary basis that a rate may be excessive, inadequate, or
516unfairly discriminatory, the office shall initiate proceedings
517to disapprove the rate and shall so notify the insurer. However,
518the office may not disapprove as excessive any rate for which it
519has given final approval or which has been deemed approved for a
520period of 1 year after the effective date of the filing unless
521the office finds that a material misrepresentation or material
522error was made by the insurer or was contained in the filing.
523Upon being so notified, the insurer or rating organization
524shall, within 60 days, file with the office all information
525which, in the belief of the insurer or organization, proves the
526reasonableness, adequacy, and fairness of the rate or rate
527change. The office shall issue a notice of intent to approve or
528a notice of intent to disapprove pursuant to the procedures of
529paragraph (a) within 90 days after receipt of the insurer's
530initial response. In such instances and in any administrative
531proceeding relating to the legality of the rate, the insurer or
532rating organization shall carry the burden of proof by a
533preponderance of the evidence to show that the rate is not
534excessive, inadequate, or unfairly discriminatory. After the
535office notifies an insurer that a rate may be excessive,
536inadequate, or unfairly discriminatory, unless the office
537withdraws the notification, the insurer shall not alter the rate
538except to conform with the office's notice until the earlier of
539120 days after the date the notification was provided or 180
540days after the date of the implementation of the rate. The
541office may, subject to chapter 120, disapprove without the 60-
542day notification any rate increase filed by an insurer within
543the prohibited time period or during the time that the legality
544of the increased rate is being contested.
545
546The provisions of this subsection shall not apply to workers'
547compensation and employer's liability insurance and to motor
548vehicle insurance.
549     (6)(a)  If an insurer requests an administrative hearing
550pursuant to s. 120.57 related to a rate filing under this
551section, the director of the Division of Administrative Hearings
552shall expedite the hearing and assign an administrative law
553judge who shall commence the hearing within 30 days after the
554receipt of the formal request and shall enter a recommended  
555order within 30 days after the hearing or within 30 days after
556receipt of the hearing transcript by the administrative law
557judge, whichever is later. Each party shall be allowed 10 days
558in which to submit written exceptions to the recommended order.
559The office shall enter a final order within 30 days after the
560entry of the recommended order. The provisions of this paragraph
561may be waived upon stipulation of all parties.
562     (b)  Upon entry of a final order, the insurer may request a
563expedited appellate review pursuant to the Florida Rules of
564Appellate Procedure. It is the intent of the Legislature that
565the First District Court of Appeal grant an insurer's request
566for an expedited appellate review.
567     (c)(a)  After any action with respect to a rate filing that
568constitutes agency action for purposes of the Administrative
569Procedure Act, except for a rate filing for medical malpractice,
570an insurer may, in lieu of demanding a hearing under s. 120.57,
571require arbitration of the rate filing. However, the arbitration
572option provision in this subsection does not apply to a rate
573filing that is made on or after the effective date of this act
574until January 1, 2010 2009. Arbitration shall be conducted by a
575board of arbitrators consisting of an arbitrator selected by the
576office, an arbitrator selected by the insurer, and an arbitrator
577selected jointly by the other two arbitrators. Each arbitrator
578must be certified by the American Arbitration Association. A
579decision is valid only upon the affirmative vote of at least two
580of the arbitrators. No arbitrator may be an employee of any
581insurance regulator or regulatory body or of any insurer,
582regardless of whether or not the employing insurer does business
583in this state. The office and the insurer must treat the
584decision of the arbitrators as the final approval of a rate
585filing. Costs of arbitration shall be paid by the insurer.
586     (d)(b)  Arbitration under this subsection shall be
587conducted pursuant to the procedures specified in ss. 682.06-
588682.10. Either party may apply to the circuit court to vacate or
589modify the decision pursuant to s. 682.13 or s. 682.14. The
590commission shall adopt rules for arbitration under this
591subsection, which rules may not be inconsistent with the
592arbitration rules of the American Arbitration Association as of
593January 1, 1996.
594     (e)(c)  Upon initiation of the arbitration process, the
595insurer waives all rights to challenge the action of the office
596under the Administrative Procedure Act or any other provision of
597law; however, such rights are restored to the insurer if the
598arbitrators fail to render a decision within 90 days after
599initiation of the arbitration process.
600     (9)(a)  Effective March 1, 2007, The chief executive
601officer or chief financial officer of a property insurer and the
602chief actuary of a property insurer must certify under oath and
603subject to the penalty of perjury, on a form approved by the
604commission, the following information, which must accompany a
605rate filing:
606     1.  The signing officer and actuary have reviewed the rate
607filing;
608     2.  Based on the signing officer's and actuary's knowledge,
609the rate filing does not contain any untrue statement of a
610material fact or omit to state a material fact necessary in
611order to make the statements made, in light of the circumstances
612under which such statements were made, not misleading;
613     3.  Based on the signing officer's and actuary's knowledge,
614the information and other factors described in paragraph (2)(b),
615including, but not limited to, investment income, fairly present
616in all material respects the basis of the rate filing for the
617periods presented in the filing; and
618     4.  Based on the signing officer's and actuary's knowledge,
619the rate filing reflects all premium savings that are reasonably
620expected to result from legislative enactments and are in
621accordance with generally accepted and reasonable actuarial
622techniques.
623     Section 9.  Paragraph (c) of subsection (1) and paragraph
624(c) of subsection (3) of section 627.0628, Florida Statutes, are
625amended, and paragraph (e) is added to subsection (1) of that
626section, to read:
627     627.0628  Florida Commission on Hurricane Loss Projection
628Methodology; public records exemption; public meetings
629exemption.--
630     (1)  LEGISLATIVE FINDINGS AND INTENT.--
631     (c)  It is the intent of the Legislature to create the
632Florida Commission on Hurricane Loss Projection Methodology as a
633panel of experts to provide the most actuarially sophisticated
634guidelines and standards for projection of hurricane losses
635possible, given the current state of actuarial science. It is
636the further intent of the Legislature that such standards and
637guidelines must be used by the State Board of Administration in
638developing reimbursement premium rates for the Florida Hurricane
639Catastrophe Fund, and, subject to paragraph (3)(c), must may be
640used by insurers in rate filings under s. 627.062 unless the way
641in which such standards and guidelines were applied by the
642insurer was erroneous, as shown by a preponderance of the
643evidence.
644     (e)  The Legislature finds that the authority to take final
645agency action with respect to insurance ratemaking is vested in
646the Office of Insurance Regulation and the Financial Services
647Commission, and that the processes, standards, and guidelines of
648the Florida Commission on Hurricane Loss Projection Methodology
649do not constitute final agency action or statements of general
650applicability that implement, interpret, or prescribe law or
651policy; accordingly, chapter 120 does not apply to the
652processes, standards, and guidelines of the Florida Commission
653on Hurricane Loss Projection Methodology.
654     (3)  ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES.--
655     (c)  With respect to a rate filing under s. 627.062, an
656insurer must may employ and may not modify or adjust actuarial
657methods, principles, standards, models, or output ranges found
658by the commission to be accurate or reliable in determining to
659determine hurricane loss factors for use in a rate filing and in
660determining probable maximum loss levels for reinsurance costs
661included in a rate filing under s. 627.062; except as provided
662in s. 627.062(2)(b)12., the use of any other model is reasonable
663if the insurer provides justification that establishes by a
664preponderance of the evidence that such use is reasonable and
665consistent with actuarial standards of practice. Such findings
666and factors are admissible and relevant in consideration of a
667rate filing by the office or in any arbitration or
668administrative or judicial review only if the office and the
669consumer advocate appointed pursuant to s. 627.0613 have access
670to all of the assumptions and factors that were used in
671developing the actuarial methods, principles, standards, models,
672or output ranges, and are not precluded from disclosing such
673information in a rate proceeding. In any rate hearing under s.
674120.57 or in any arbitration proceeding under s. 627.062(6), the
675hearing officer, judge, or arbitration panel may determine
676whether the office and the consumer advocate were provided with
677access to all of the assumptions and factors that were used in
678developing the actuarial methods, principles, standards, models,
679or output ranges and to determine their admissibility.
680     Section 10.  Subsection (1) of section 627.0629, Florida
681Statutes, is amended to read:
682     627.0629  Residential property insurance; rate filings.--
683     (1)(a)  It is the intent of the Legislature that insurers
684must provide savings to consumers who install or implement
685windstorm damage mitigation techniques, alterations, or
686solutions to their properties to prevent windstorm losses. A
687rate filing for residential property insurance must include
688actuarially reasonable discounts, credits, or other rate
689differentials, or appropriate reductions in deductibles, for
690properties on which fixtures or construction techniques
691demonstrated to reduce the amount of loss in a windstorm have
692been installed or implemented. The fixtures or construction
693techniques shall include, but not be limited to, fixtures or
694construction techniques which enhance roof strength, roof
695covering performance, roof-to-wall strength, wall-to-floor-to-
696foundation strength, opening protection, and window, door, and
697skylight strength. Credits, discounts, or other rate
698differentials, or appropriate reductions in deductibles, for
699fixtures and construction techniques which meet the minimum
700requirements of the Florida Building Code must be included in
701the rate filing. All insurance companies must make a rate filing
702which includes the credits, discounts, or other rate
703differentials or reductions in deductibles by February 28, 2003.
704By July 1, 2007, the office shall reevaluate the discounts,
705credits, other rate differentials, and appropriate reductions in
706deductibles for fixtures and construction techniques that meet
707the minimum requirements of the Florida Building Code, based
708upon actual experience or any other loss relativity studies
709available to the office. The office shall determine the
710discounts, credits, other rate differentials, and appropriate
711reductions in deductibles that reflect the full actuarial value
712of such revaluation, which may be used by insurers in rate
713filings.
714     (b)  By February 1, 2011, the Office of Insurance
715Regulation, in consultation with the Department of Financial
716Services and the Department of Community Affairs, shall develop
717and make publicly available a proposed method for insurers to
718establish discounts, credits, or other rate differentials for
719hurricane mitigation measures which directly correlate to the
720numerical rating assigned to a structure pursuant to the uniform
721home grading scale adopted by the Financial Services Commission
722pursuant to s. 215.55865, including any proposed changes to the
723uniform home grading scale. By October 1, 2011, the commission
724shall adopt rules requiring insurers to make rate filings for
725residential property insurance which revise insurers' discounts,
726credits, or other rate differentials for hurricane mitigation
727measures so that such rate differentials correlate directly to
728the uniform home grading scale. The rules may include such
729changes to the uniform home grading scale as the commission
730determines are necessary, and may specify the minimum required
731discounts, credits, or other rate differentials. Such rate
732differentials must be consistent with generally accepted
733actuarial principles and wind-loss mitigation studies. The rules
734shall allow a period of at least 2 years after the effective
735date of the revised mitigation discounts, credits, or other rate
736differentials for a property owner to obtain an inspection or
737otherwise qualify for the revised credit, during which time the
738insurer shall continue to apply the mitigation credit that was
739applied immediately prior to the effective date of the revised
740credit.
741     Section 11.  Paragraphs (a), (b), (c), (m), (p), (w), (dd),
742and (ee) of subsection (6) of section 627.351, Florida Statutes,
743are amended, and a new paragraph (ff) is added to that
744subsection, to read:
745     627.351  Insurance risk apportionment plans.--
746     (6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
747     (a)1.  It is the public purpose of this subsection to
748ensure the existence of an orderly market for property insurance
749for Floridians and Florida businesses. The Legislature finds
750that private insurers are unwilling or unable to provide
751affordable property insurance coverage in this state to the
752extent sought and needed. The absence of affordable property
753insurance threatens the public health, safety, and welfare and
754likewise threatens the economic health of the state. The state
755therefore has a compelling public interest and a public purpose
756to assist in assuring that property in the state is insured and
757that it is insured at affordable rates so as to facilitate the
758remediation, reconstruction, and replacement of damaged or
759destroyed property in order to reduce or avoid the negative
760effects otherwise resulting to the public health, safety, and
761welfare, to the economy of the state, and to the revenues of the
762state and local governments which are needed to provide for the
763public welfare. It is necessary, therefore, to provide
764affordable property insurance to applicants who are in good
765faith entitled to procure insurance through the voluntary market
766but are unable to do so. The Legislature intends by this
767subsection that affordable property insurance be provided and
768that it continue to be provided, as long as necessary, through
769Citizens Property Insurance Corporation, a government entity
770that is an integral part of the state, and that is not a private
771insurance company. To that end, Citizens Property Insurance
772Corporation shall strive to increase the availability of
773affordable property insurance in this state, while achieving
774efficiencies and economies, and while providing service to
775policyholders, applicants, and agents which is no less than the
776quality generally provided in the voluntary market, for the
777achievement of the foregoing public purposes. Because it is
778essential for this government entity to have the maximum
779financial resources to pay claims following a catastrophic
780hurricane, it is the intent of the Legislature that Citizens
781Property Insurance Corporation continue to be an integral part
782of the state and that the income of the corporation be exempt
783from federal income taxation and that interest on the debt
784obligations issued by the corporation be exempt from federal
785income taxation.
786     2.  The Residential Property and Casualty Joint
787Underwriting Association originally created by this statute
788shall be known, as of July 1, 2002, as the Citizens Property
789Insurance Corporation. The corporation shall provide insurance
790for residential and commercial property, for applicants who are
791in good faith entitled, but are unable, to procure insurance
792through the voluntary market. The corporation shall operate
793pursuant to a plan of operation approved by order of the
794Financial Services Commission. The plan is subject to continuous
795review by the commission. The commission may, by order, withdraw
796approval of all or part of a plan if the commission determines
797that conditions have changed since approval was granted and that
798the purposes of the plan require changes in the plan. The
799corporation shall continue to operate pursuant to the plan of
800operation approved by the Office of Insurance Regulation until
801October 1, 2006. For the purposes of this subsection,
802residential coverage includes both personal lines residential
803coverage, which consists of the type of coverage provided by
804homeowner's, mobile home owner's, dwelling, tenant's,
805condominium unit owner's, and similar policies, and commercial
806lines residential coverage, which consists of the type of
807coverage provided by condominium association, apartment
808building, and similar policies.
809     3.  For the purposes of this subsection, the term
810"homestead property" means:
811     a.  Property that has been granted a homestead exemption
812under chapter 196;
813     b.  Property for which the owner has a current, written
814lease with a renter for a term of at least 7 months and for
815which the dwelling is insured by the corporation for $200,000 or
816less;
817     c.  An owner-occupied mobile home or manufactured home, as
818defined in s. 320.01, which is permanently affixed to real
819property, is owned by a Florida resident, and has been granted a
820homestead exemption under chapter 196 or, if the owner does not
821own the real property, the owner certifies that the mobile home
822or manufactured home is his or her principal place of residence;
823     d.  Tenant's coverage;
824     e.  Commercial lines residential property; or
825     f.  Any county, district, or municipal hospital; a hospital
826licensed by any not-for-profit corporation qualified under s.
827501(c)(3) of the United States Internal Revenue Code; or a
828continuing care retirement community that is certified under
829chapter 651 and that receives an exemption from ad valorem taxes
830under chapter 196.
831     4.  For the purposes of this subsection, the term
832"nonhomestead property" means property that is not homestead
833property.
834     3.5.  Effective January 1, 2009, a personal lines
835residential structure that has a dwelling replacement cost of $2
836$1 million or more, or a single condominium unit that has a
837combined dwelling and content replacement cost of $2 $1 million
838or more is not eligible for coverage by the corporation. Such
839dwellings insured by the corporation on December 31, 2008, may
840continue to be covered by the corporation until the end of the
841policy term. However, such dwellings that are insured by the
842corporation and become ineligible for coverage due to the
843provisions of this subparagraph may reapply and obtain coverage
844in the high-risk account and be considered "nonhomestead
845property" if the property owner provides the corporation with a
846sworn affidavit from one or more insurance agents, on a form
847provided by the corporation, stating that the agents have made
848their best efforts to obtain coverage and that the property has
849been rejected for coverage by at least one authorized insurer
850and at least three surplus lines insurers. If such conditions
851are met, the dwelling may be insured by the corporation for up
852to 3 years, after which time the dwelling is ineligible for
853coverage. The office shall approve the method used by the
854corporation for valuing the dwelling replacement cost for the
855purposes of this subparagraph. If a policyholder is insured by
856the corporation prior to being determined to be ineligible
857pursuant to this subparagraph and such policyholder files a
858lawsuit challenging the determination, the policyholder may
859remain insured by the corporation until the conclusion of the
860litigation.
8616.  For properties constructed on or after January 1, 2009,
862the corporation may not insure any property located within 2,500
863feet landward of the coastal construction control line created
864pursuant to s. 161.053 unless the property meets the
865requirements of the code-plus building standards developed by
866the Florida Building Commission.
8674.7.  It is the intent of the Legislature that
868policyholders, applicants, and agents of the corporation receive
869service and treatment of the highest possible level but never
870less than that generally provided in the voluntary market. It
871also is intended that the corporation be held to service
872standards no less than those applied to insurers in the
873voluntary market by the office with respect to responsiveness,
874timeliness, customer courtesy, and overall dealings with
875policyholders, applicants, or agents of the corporation.
876     5.8.  Effective January 1, 2009, a personal lines
877residential structure that is located in the "wind-borne debris
878region," as defined in s. 1609.2, International Building Code
879(2006), and that has an insured value on the structure of
880$750,000 or more is not eligible for coverage by the corporation
881unless the structure has opening protections as required under
882the Florida Building Code for a newly constructed residential
883structure in that area. A residential structure shall be deemed
884to comply with the requirements of this subparagraph if it has
885shutters or opening protections on all openings and if such
886opening protections complied with the Florida Building Code at
887the time they were installed.
888     (b)1.  All insurers authorized to write one or more subject
889lines of business in this state are subject to assessment by the
890corporation and, for the purposes of this subsection, are
891referred to collectively as "assessable insurers." Insurers
892writing one or more subject lines of business in this state
893pursuant to part VIII of chapter 626 are not assessable
894insurers, but insureds who procure one or more subject lines of
895business in this state pursuant to part VIII of chapter 626 are
896subject to assessment by the corporation and are referred to
897collectively as "assessable insureds." An authorized insurer's
898assessment liability shall begin on the first day of the
899calendar year following the year in which the insurer was issued
900a certificate of authority to transact insurance for subject
901lines of business in this state and shall terminate 1 year after
902the end of the first calendar year during which the insurer no
903longer holds a certificate of authority to transact insurance
904for subject lines of business in this state.
905     2.a.  All revenues, assets, liabilities, losses, and
906expenses of the corporation shall be divided into three separate
907accounts as follows:
908     (I)  A personal lines account for personal residential
909policies issued by the corporation or issued by the Residential
910Property and Casualty Joint Underwriting Association and renewed
911by the corporation that provide comprehensive, multiperil
912coverage on risks that are not located in areas eligible for
913coverage in the Florida Windstorm Underwriting Association as
914those areas were defined on January 1, 2002, and for such
915policies that do not provide coverage for the peril of wind on
916risks that are located in such areas;
917     (II)  A commercial lines account for commercial residential
918and commercial nonresidential policies issued by the corporation
919or issued by the Residential Property and Casualty Joint
920Underwriting Association and renewed by the corporation that
921provide coverage for basic property perils on risks that are not
922located in areas eligible for coverage in the Florida Windstorm
923Underwriting Association as those areas were defined on January
9241, 2002, and for such policies that do not provide coverage for
925the peril of wind on risks that are located in such areas; and
926     (III)  A high-risk account for personal residential
927policies and commercial residential and commercial
928nonresidential property policies issued by the corporation or
929transferred to the corporation that provide coverage for the
930peril of wind on risks that are located in areas eligible for
931coverage in the Florida Windstorm Underwriting Association as
932those areas were defined on January 1, 2002. Subject to the
933approval of a business plan by the Financial Services Commission
934and Legislative Budget Commission as provided in this sub-sub-
935subparagraph, but no earlier than March 31, 2007, The
936corporation may offer policies that provide multiperil coverage
937and the corporation shall continue to offer policies that
938provide coverage only for the peril of wind for risks located in
939areas eligible for coverage in the high-risk account. In issuing
940multiperil coverage, the corporation may use its approved policy
941forms and rates for the personal lines account. An applicant or
942insured who is eligible to purchase a multiperil policy from the
943corporation may purchase a multiperil policy from an authorized
944insurer without prejudice to the applicant's or insured's
945eligibility to prospectively purchase a policy that provides
946coverage only for the peril of wind from the corporation. An
947applicant or insured who is eligible for a corporation policy
948that provides coverage only for the peril of wind may elect to
949purchase or retain such policy and also purchase or retain
950coverage excluding wind from an authorized insurer without
951prejudice to the applicant's or insured's eligibility to
952prospectively purchase a policy that provides multiperil
953coverage from the corporation. It is the goal of the Legislature
954that there would be an overall average savings of 10 percent or
955more for a policyholder who currently has a wind-only policy
956with the corporation, and an ex-wind policy with a voluntary
957insurer or the corporation, and who then obtains a multiperil
958policy from the corporation. It is the intent of the Legislature
959that the offer of multiperil coverage in the high-risk account
960be made and implemented in a manner that does not adversely
961affect the tax-exempt status of the corporation or
962creditworthiness of or security for currently outstanding
963financing obligations or credit facilities of the high-risk
964account, the personal lines account, or the commercial lines
965account. By March 1, 2007, the corporation shall prepare and
966submit for approval by the Financial Services Commission and
967Legislative Budget Commission a report detailing the
968corporation's business plan for issuing multiperil coverage in
969the high-risk account. The business plan shall be approved or
970disapproved within 30 days after receipt, as submitted or
971modified and resubmitted by the corporation. The business plan
972must include: the impact of such multiperil coverage on the
973corporation's financial resources, the impact of such multiperil
974coverage on the corporation's tax-exempt status, the manner in
975which the corporation plans to implement the processing of
976applications and policy forms for new and existing
977policyholders, the impact of such multiperil coverage on the
978corporation's ability to deliver customer service at the high
979level required by this subsection, the ability of the
980corporation to process claims, the ability of the corporation to
981quote and issue policies, the impact of such multiperil coverage
982on the corporation's agents, the impact of such multiperil
983coverage on the corporation's existing policyholders, and the
984impact of such multiperil coverage on rates and premium. The
985high-risk account must also include quota share primary
986insurance under subparagraph (c)2. The area eligible for
987coverage under the high-risk account also includes the area
988within Port Canaveral, which is bordered on the south by the
989City of Cape Canaveral, bordered on the west by the Banana
990River, and bordered on the north by Federal Government property.
991     b.  The three separate accounts must be maintained as long
992as financing obligations entered into by the Florida Windstorm
993Underwriting Association or Residential Property and Casualty
994Joint Underwriting Association are outstanding, in accordance
995with the terms of the corresponding financing documents. When
996the financing obligations are no longer outstanding, in
997accordance with the terms of the corresponding financing
998documents, the corporation may use a single account for all
999revenues, assets, liabilities, losses, and expenses of the
1000corporation. Consistent with the requirement of this
1001subparagraph and prudent investment policies that minimize the
1002cost of carrying debt, the board shall exercise its best efforts
1003to retire existing debt or to obtain approval of necessary
1004parties to amend the terms of existing debt, so as to structure
1005the most efficient plan to consolidate the three separate
1006accounts into a single account. By February 1, 2007, the board
1007shall submit a report to the Financial Services Commission, the
1008President of the Senate, and the Speaker of the House of
1009Representatives which includes an analysis of consolidating the
1010accounts, the actions the board has taken to minimize the cost
1011of carrying debt, and its recommendations for executing the most
1012efficient plan.
1013     c.  Creditors of the Residential Property and Casualty
1014Joint Underwriting Association and of the accounts specified in
1015sub-sub-subparagraphs a.(I) and (II) may have a claim against,
1016and recourse to, the accounts referred to in sub-sub-
1017subparagraphs a.(I) and (II) and shall have no claim against, or
1018recourse to, the account referred to in sub-sub-subparagraph
1019a.(III). Creditors of the Florida Windstorm Underwriting
1020Association shall have a claim against, and recourse to, the
1021account referred to in sub-sub-subparagraph a.(III) and shall
1022have no claim against, or recourse to, the accounts referred to
1023in sub-sub-subparagraphs a.(I) and (II).
1024     d.  Revenues, assets, liabilities, losses, and expenses not
1025attributable to particular accounts shall be prorated among the
1026accounts.
1027     e.  The Legislature finds that the revenues of the
1028corporation are revenues that are necessary to meet the
1029requirements set forth in documents authorizing the issuance of
1030bonds under this subsection.
1031     f.  No part of the income of the corporation may inure to
1032the benefit of any private person.
1033     3.  With respect to a deficit in an account:
1034     a.  After accounting for the Citizens policyholder
1035surcharge imposed under sub-subparagraph i., when the remaining
1036projected deficit incurred in a particular calendar year is not
1037greater than 6 10 percent of the aggregate statewide direct
1038written premium for the subject lines of business for the prior
1039calendar year, the entire deficit shall be recovered through
1040regular assessments of assessable insurers under paragraph (p)
1041and assessable insureds.
1042     b.  After accounting for the Citizens policyholder
1043surcharge imposed under sub-subparagraph i., when the remaining
1044projected deficit incurred in a particular calendar year exceeds
10456 10 percent of the aggregate statewide direct written premium
1046for the subject lines of business for the prior calendar year,
1047the corporation shall levy regular assessments on assessable
1048insurers under paragraph (p) and on assessable insureds in an
1049amount equal to the greater of 6 10 percent of the deficit or 6
105010 percent of the aggregate statewide direct written premium for
1051the subject lines of business for the prior calendar year. Any
1052remaining deficit shall be recovered through emergency
1053assessments under sub-subparagraph d.
1054     c.  Each assessable insurer's share of the amount being
1055assessed under sub-subparagraph a. or sub-subparagraph b. shall
1056be in the proportion that the assessable insurer's direct
1057written premium for the subject lines of business for the year
1058preceding the assessment bears to the aggregate statewide direct
1059written premium for the subject lines of business for that year.
1060The assessment percentage applicable to each assessable insured
1061is the ratio of the amount being assessed under sub-subparagraph
1062a. or sub-subparagraph b. to the aggregate statewide direct
1063written premium for the subject lines of business for the prior
1064year. Assessments levied by the corporation on assessable
1065insurers under sub-subparagraphs a. and b. shall be paid as
1066required by the corporation's plan of operation and paragraph
1067(p). notwithstanding any other provision of this subsection, the
1068aggregate amount of a regular assessment for a deficit incurred
1069in a particular calendar year shall be reduced by the estimated
1070amount to be received by the corporation from the Citizens
1071policyholder surcharge under subparagraph (c)10. and the amount
1072collected or estimated to be collected from the assessment on
1073Citizens policyholders pursuant to sub-subparagraph i.
1074Assessments levied by the corporation on assessable insureds
1075under sub-subparagraphs a. and b. shall be collected by the
1076surplus lines agent at the time the surplus lines agent collects
1077the surplus lines tax required by s. 626.932 and shall be paid
1078to the Florida Surplus Lines Service Office at the time the
1079surplus lines agent pays the surplus lines tax to the Florida
1080Surplus Lines Service Office. Upon receipt of regular
1081assessments from surplus lines agents, the Florida Surplus Lines
1082Service Office shall transfer the assessments directly to the
1083corporation as determined by the corporation.
1084     d.  Upon a determination by the board of governors that a
1085deficit in an account exceeds the amount that will be recovered
1086through regular assessments under sub-subparagraph a. or sub-
1087subparagraph b., plus the amount that is expected to be
1088recovered through surcharges under sub-subparagraph i., as to
1089the remaining projected deficit the board shall levy, after
1090verification by the office, emergency assessments, for as many
1091years as necessary to cover the deficits, to be collected by
1092assessable insurers and the corporation and collected from
1093assessable insureds upon issuance or renewal of policies for
1094subject lines of business, excluding National Flood Insurance
1095policies. The amount of the emergency assessment collected in a
1096particular year shall be a uniform percentage of that year's
1097direct written premium for subject lines of business and all
1098accounts of the corporation, excluding National Flood Insurance
1099Program policy premiums, as annually determined by the board and
1100verified by the office. The office shall verify the arithmetic
1101calculations involved in the board's determination within 30
1102days after receipt of the information on which the determination
1103was based. Notwithstanding any other provision of law, the
1104corporation and each assessable insurer that writes subject
1105lines of business shall collect emergency assessments from its
1106policyholders without such obligation being affected by any
1107credit, limitation, exemption, or deferment. Emergency
1108assessments levied by the corporation on assessable insureds
1109shall be collected by the surplus lines agent at the time the
1110surplus lines agent collects the surplus lines tax required by
1111s. 626.932 and shall be paid to the Florida Surplus Lines
1112Service Office at the time the surplus lines agent pays the
1113surplus lines tax to the Florida Surplus Lines Service Office.
1114The emergency assessments so collected shall be transferred
1115directly to the corporation on a periodic basis as determined by
1116the corporation and shall be held by the corporation solely in
1117the applicable account. The aggregate amount of emergency
1118assessments levied for an account under this sub-subparagraph in
1119any calendar year may, at the discretion of the board of
1120governors, be less than but may not exceed the greater of 10
1121percent of the amount needed to cover the original deficit, plus
1122interest, fees, commissions, required reserves, and other costs
1123associated with financing of the original deficit, or 10 percent
1124of the aggregate statewide direct written premium for subject
1125lines of business and for all accounts of the corporation for
1126the prior year, plus interest, fees, commissions, required
1127reserves, and other costs associated with financing the original
1128deficit.
1129     e.  The corporation may pledge the proceeds of assessments,
1130projected recoveries from the Florida Hurricane Catastrophe
1131Fund, other insurance and reinsurance recoverables, policyholder
1132surcharges and other surcharges, and other funds available to
1133the corporation as the source of revenue for and to secure bonds
1134issued under paragraph (p), bonds or other indebtedness issued
1135under subparagraph (c)3., or lines of credit or other financing
1136mechanisms issued or created under this subsection, or to retire
1137any other debt incurred as a result of deficits or events giving
1138rise to deficits, or in any other way that the board determines
1139will efficiently recover such deficits. The purpose of the lines
1140of credit or other financing mechanisms is to provide additional
1141resources to assist the corporation in covering claims and
1142expenses attributable to a catastrophe. As used in this
1143subsection, the term "assessments" includes regular assessments
1144under sub-subparagraph a., sub-subparagraph b., or subparagraph
1145(p)1. and emergency assessments under sub-subparagraph d.
1146Emergency assessments collected under sub-subparagraph d. are
1147not part of an insurer's rates, are not premium, and are not
1148subject to premium tax, fees, or commissions; however, failure
1149to pay the emergency assessment shall be treated as failure to
1150pay premium. The emergency assessments under sub-subparagraph d.
1151shall continue as long as any bonds issued or other indebtedness
1152incurred with respect to a deficit for which the assessment was
1153imposed remain outstanding, unless adequate provision has been
1154made for the payment of such bonds or other indebtedness
1155pursuant to the documents governing such bonds or other
1156indebtedness.
1157     f.  As used in this subsection for purposes of any deficit
1158incurred on or after January 25, 2007, the term "subject lines
1159of business" means insurance written by assessable insurers or
1160procured by assessable insureds for all property and casualty
1161lines of business in this state, but not including workers'
1162compensation or medical malpractice. As used in the sub-
1163subparagraph, the term "property and casualty lines of business"
1164includes all lines of business identified on Form 2, Exhibit of
1165Premiums and Losses, in the annual statement required of
1166authorized insurers by s. 624.424 and any rule adopted under
1167this section, except for those lines identified as accident and
1168health insurance and except for policies written under the
1169National Flood Insurance Program or the Federal Crop Insurance
1170Program. For purposes of this sub-subparagraph, the term
1171"workers' compensation" includes both workers' compensation
1172insurance and excess workers' compensation insurance.
1173     g.  The Florida Surplus Lines Service Office shall
1174determine annually the aggregate statewide written premium in
1175subject lines of business procured by assessable insureds and
1176shall report that information to the corporation in a form and
1177at a time the corporation specifies to ensure that the
1178corporation can meet the requirements of this subsection and the
1179corporation's financing obligations.
1180     h.  The Florida Surplus Lines Service Office shall verify
1181the proper application by surplus lines agents of assessment
1182percentages for regular assessments and emergency assessments
1183levied under this subparagraph on assessable insureds and shall
1184assist the corporation in ensuring the accurate, timely
1185collection and payment of assessments by surplus lines agents as
1186required by the corporation.
1187     i.  If a deficit is incurred in any account in 2008 or
1188thereafter, the board of governors shall levy a Citizens
1189policyholder surcharge an immediate assessment against the
1190premium of each nonhomestead property policyholder in all
1191accounts of the corporation, as a uniform percentage of the
1192premium of the policy of up to 10 percent of such premium, which
1193funds shall be used to offset the deficit. If this assessment is
1194insufficient to eliminate the deficit, the board of governors
1195shall levy an additional assessment against all policyholders of
1196the corporation for a 12-month period, which shall be collected
1197at the time of issuance or renewal of a policy, as a uniform
1198percentage of the premium for the policy of up to 15 10 percent
1199of such premium, which funds shall be used to further offset the
1200deficit. Citizens policyholder surcharges under this sub-
1201subparagraph are not considered premium and are not subject to
1202commissions, fees, or premium taxes. However, failure to pay
1203such surcharges shall be treated as failure to pay premium.
1204     j.  If the amount of any assessments or surcharges
1205collected from corporation policyholders, assessable insurers or
1206their policyholders, or assessable insureds exceeds the amount
1207of the deficits, such excess amounts shall be remitted to and
1208retained by the corporation in a reserve to be used by the
1209corporation, as determined by the board of governors and
1210approved by the office, to pay claims or reduce any past,
1211present, or future plan-year deficits or to reduce outstanding
1212debt. The board of governors shall maintain separate accounting
1213records that consolidate data for nonhomestead properties,
1214including, but not limited to, number of policies, insured
1215values, premiums written, and losses. The board of governors
1216shall annually report to the office and the Legislature a
1217summary of such data.
1218     (c)  The plan of operation of the corporation:
1219     1.  Must provide for adoption of residential property and
1220casualty insurance policy forms and commercial residential and
1221nonresidential property insurance forms, which forms must be
1222approved by the office prior to use. The corporation shall adopt
1223the following policy forms:
1224     a.  Standard personal lines policy forms that are
1225comprehensive multiperil policies providing full coverage of a
1226residential property equivalent to the coverage provided in the
1227private insurance market under an HO-3, HO-4, or HO-6 policy.
1228     b.  Basic personal lines policy forms that are policies
1229similar to an HO-8 policy or a dwelling fire policy that provide
1230coverage meeting the requirements of the secondary mortgage
1231market, but which coverage is more limited than the coverage
1232under a standard policy.
1233     c.  Commercial lines residential and nonresidential policy
1234forms that are generally similar to the basic perils of full
1235coverage obtainable for commercial residential structures and
1236commercial nonresidential structures in the admitted voluntary
1237market.
1238     d.  Personal lines and commercial lines residential
1239property insurance forms that cover the peril of wind only. The
1240forms are applicable only to residential properties located in
1241areas eligible for coverage under the high-risk account referred
1242to in sub-subparagraph (b)2.a.
1243     e.  Commercial lines nonresidential property insurance
1244forms that cover the peril of wind only. The forms are
1245applicable only to nonresidential properties located in areas
1246eligible for coverage under the high-risk account referred to in
1247sub-subparagraph (b)2.a.
1248     f.  The corporation may adopt variations of the policy
1249forms listed in sub-subparagraphs a.-e. that contain more
1250restrictive coverage.
1251     2.a.  Must provide that the corporation adopt a program in
1252which the corporation and authorized insurers enter into quota
1253share primary insurance agreements for hurricane coverage, as
1254defined in s. 627.4025(2)(a), for eligible risks, and adopt
1255property insurance forms for eligible risks which cover the
1256peril of wind only. As used in this subsection, the term:
1257     (I)  "Quota share primary insurance" means an arrangement
1258in which the primary hurricane coverage of an eligible risk is
1259provided in specified percentages by the corporation and an
1260authorized insurer. The corporation and authorized insurer are
1261each solely responsible for a specified percentage of hurricane
1262coverage of an eligible risk as set forth in a quota share
1263primary insurance agreement between the corporation and an
1264authorized insurer and the insurance contract. The
1265responsibility of the corporation or authorized insurer to pay
1266its specified percentage of hurricane losses of an eligible
1267risk, as set forth in the quota share primary insurance
1268agreement, may not be altered by the inability of the other
1269party to the agreement to pay its specified percentage of
1270hurricane losses. Eligible risks that are provided hurricane
1271coverage through a quota share primary insurance arrangement
1272must be provided policy forms that set forth the obligations of
1273the corporation and authorized insurer under the arrangement,
1274clearly specify the percentages of quota share primary insurance
1275provided by the corporation and authorized insurer, and
1276conspicuously and clearly state that neither the authorized
1277insurer nor the corporation may be held responsible beyond its
1278specified percentage of coverage of hurricane losses.
1279     (II)  "Eligible risks" means personal lines residential and
1280commercial lines residential risks that meet the underwriting
1281criteria of the corporation and are located in areas that were
1282eligible for coverage by the Florida Windstorm Underwriting
1283Association on January 1, 2002.
1284     b.  The corporation may enter into quota share primary
1285insurance agreements with authorized insurers at corporation
1286coverage levels of 90 percent and 50 percent.
1287     c.  If the corporation determines that additional coverage
1288levels are necessary to maximize participation in quota share
1289primary insurance agreements by authorized insurers, the
1290corporation may establish additional coverage levels. However,
1291the corporation's quota share primary insurance coverage level
1292may not exceed 90 percent.
1293     d.  Any quota share primary insurance agreement entered
1294into between an authorized insurer and the corporation must
1295provide for a uniform specified percentage of coverage of
1296hurricane losses, by county or territory as set forth by the
1297corporation board, for all eligible risks of the authorized
1298insurer covered under the quota share primary insurance
1299agreement.
1300     e.  Any quota share primary insurance agreement entered
1301into between an authorized insurer and the corporation is
1302subject to review and approval by the office. However, such
1303agreement shall be authorized only as to insurance contracts
1304entered into between an authorized insurer and an insured who is
1305already insured by the corporation for wind coverage.
1306     f.  For all eligible risks covered under quota share
1307primary insurance agreements, the exposure and coverage levels
1308for both the corporation and authorized insurers shall be
1309reported by the corporation to the Florida Hurricane Catastrophe
1310Fund. For all policies of eligible risks covered under quota
1311share primary insurance agreements, the corporation and the
1312authorized insurer shall maintain complete and accurate records
1313for the purpose of exposure and loss reimbursement audits as
1314required by Florida Hurricane Catastrophe Fund rules. The
1315corporation and the authorized insurer shall each maintain
1316duplicate copies of policy declaration pages and supporting
1317claims documents.
1318     g.  The corporation board shall establish in its plan of
1319operation standards for quota share agreements which ensure that
1320there is no discriminatory application among insurers as to the
1321terms of quota share agreements, pricing of quota share
1322agreements, incentive provisions if any, and consideration paid
1323for servicing policies or adjusting claims.
1324     h.  The quota share primary insurance agreement between the
1325corporation and an authorized insurer must set forth the
1326specific terms under which coverage is provided, including, but
1327not limited to, the sale and servicing of policies issued under
1328the agreement by the insurance agent of the authorized insurer
1329producing the business, the reporting of information concerning
1330eligible risks, the payment of premium to the corporation, and
1331arrangements for the adjustment and payment of hurricane claims
1332incurred on eligible risks by the claims adjuster and personnel
1333of the authorized insurer. Entering into a quota sharing
1334insurance agreement between the corporation and an authorized
1335insurer shall be voluntary and at the discretion of the
1336authorized insurer.
1337     3.  May provide that the corporation may employ or
1338otherwise contract with individuals or other entities to provide
1339administrative or professional services that may be appropriate
1340to effectuate the plan. The corporation shall have the power to
1341borrow funds, by issuing bonds or by incurring other
1342indebtedness, and shall have other powers reasonably necessary
1343to effectuate the requirements of this subsection, including,
1344without limitation, the power to issue bonds and incur other
1345indebtedness in order to refinance outstanding bonds or other
1346indebtedness. The corporation may, but is not required to, seek
1347judicial validation of its bonds or other indebtedness under
1348chapter 75. The corporation may issue bonds or incur other
1349indebtedness, or have bonds issued on its behalf by a unit of
1350local government pursuant to subparagraph (p)2., in the absence
1351of a hurricane or other weather-related event, upon a
1352determination by the corporation, subject to approval by the
1353office, that such action would enable it to efficiently meet the
1354financial obligations of the corporation and that such
1355financings are reasonably necessary to effectuate the
1356requirements of this subsection. The corporation is authorized
1357to take all actions needed to facilitate tax-free status for any
1358such bonds or indebtedness, including formation of trusts or
1359other affiliated entities. The corporation shall have the
1360authority to pledge assessments, projected recoveries from the
1361Florida Hurricane Catastrophe Fund, other reinsurance
1362recoverables, market equalization and other surcharges, and
1363other funds available to the corporation as security for bonds
1364or other indebtedness. In recognition of s. 10, Art. I of the
1365State Constitution, prohibiting the impairment of obligations of
1366contracts, it is the intent of the Legislature that no action be
1367taken whose purpose is to impair any bond indenture or financing
1368agreement or any revenue source committed by contract to such
1369bond or other indebtedness.
1370     4.a.  Must require that the corporation operate subject to
1371the supervision and approval of a board of governors consisting
1372of eight individuals who are residents of this state, from
1373different geographical areas of this state. The Governor, the
1374Chief Financial Officer, the President of the Senate, and the
1375Speaker of the House of Representatives shall each appoint two
1376members of the board. At least one of the two members appointed
1377by each appointing officer must have demonstrated expertise in
1378insurance. The Chief Financial Officer shall designate one of
1379the appointees as chair. All board members serve at the pleasure
1380of the appointing officer. All members of the board of governors
1381are subject to removal at will by the officers who appointed
1382them. All board members, including the chair, must be appointed
1383to serve for 3-year terms beginning annually on a date
1384designated by the plan. Any board vacancy shall be filled for
1385the unexpired term by the appointing officer. The Chief
1386Financial Officer shall appoint a technical advisory group to
1387provide information and advice to the board of governors in
1388connection with the board's duties under this subsection. The
1389executive director and senior managers of the corporation shall
1390be engaged by the board and serve at the pleasure of the board.
1391Any executive director appointed on or after July 1, 2006, is
1392subject to confirmation by the Senate. The executive director is
1393responsible for employing other staff as the corporation may
1394require, subject to review and concurrence by the board.
1395     b.  The board shall create a Market Accountability Advisory
1396Committee to assist the corporation in developing awareness of
1397its rates and its customer and agent service levels in
1398relationship to the voluntary market insurers writing similar
1399coverage. The members of the advisory committee shall consist of
1400the following 11 persons, one of whom must be elected chair by
1401the members of the committee: four representatives, one
1402appointed by the Florida Association of Insurance Agents, one by
1403the Florida Association of Insurance and Financial Advisors, one
1404by the Professional Insurance Agents of Florida, and one by the
1405Latin American Association of Insurance Agencies; three
1406representatives appointed by the insurers with the three highest
1407voluntary market share of residential property insurance
1408business in the state; one representative from the Office of
1409Insurance Regulation; one consumer appointed by the board who is
1410insured by the corporation at the time of appointment to the
1411committee; one representative appointed by the Florida
1412Association of Realtors; and one representative appointed by the
1413Florida Bankers Association. All members must serve for 3-year
1414terms and may serve for consecutive terms. The committee shall
1415report to the corporation at each board meeting on insurance
1416market issues which may include rates and rate competition with
1417the voluntary market; service, including policy issuance, claims
1418processing, and general responsiveness to policyholders,
1419applicants, and agents; and matters relating to depopulation.
1420     5.  Must provide a procedure for determining the
1421eligibility of a risk for coverage, as follows:
1422     a.  Subject to the provisions of s. 627.3517, with respect
1423to personal lines residential risks, if the risk is offered
1424coverage from an authorized insurer at the insurer's approved
1425rate under either a standard policy including wind coverage or,
1426if consistent with the insurer's underwriting rules as filed
1427with the office, a basic policy including wind coverage, for a
1428new application to the corporation for coverage, the risk is not
1429eligible for any policy issued by the corporation unless the
1430premium for coverage from the authorized insurer is more than 15
1431percent greater than the premium for comparable coverage from
1432the corporation. If the risk is not able to obtain any such
1433offer, the risk is eligible for either a standard policy
1434including wind coverage or a basic policy including wind
1435coverage issued by the corporation; however, if the risk could
1436not be insured under a standard policy including wind coverage
1437regardless of market conditions, the risk shall be eligible for
1438a basic policy including wind coverage unless rejected under
1439subparagraph 9. However, with regard to a policyholder of the
1440corporation or a policyholder removed from the corporation
1441through an assumption agreement until the end of the assumption
1442period, the policyholder remains eligible for coverage from the
1443corporation regardless of any offer of coverage from an
1444authorized insurer or surplus lines insurer. The corporation
1445shall determine the type of policy to be provided on the basis
1446of objective standards specified in the underwriting manual and
1447based on generally accepted underwriting practices.
1448     (I)  If the risk accepts an offer of coverage through the
1449market assistance plan or an offer of coverage through a
1450mechanism established by the corporation before a policy is
1451issued to the risk by the corporation or during the first 30
1452days of coverage by the corporation, and the producing agent who
1453submitted the application to the plan or to the corporation is
1454not currently appointed by the insurer, the insurer shall:
1455     (A)  Pay to the producing agent of record of the policy,
1456for the first year, an amount that is the greater of the
1457insurer's usual and customary commission for the type of policy
1458written or a fee equal to the usual and customary commission of
1459the corporation; or
1460     (B)  Offer to allow the producing agent of record of the
1461policy to continue servicing the policy for a period of not less
1462than 1 year and offer to pay the agent the greater of the
1463insurer's or the corporation's usual and customary commission
1464for the type of policy written.
1465
1466If the producing agent is unwilling or unable to accept
1467appointment, the new insurer shall pay the agent in accordance
1468with sub-sub-sub-subparagraph (A).
1469     (II)  When the corporation enters into a contractual
1470agreement for a take-out plan, the producing agent of record of
1471the corporation policy is entitled to retain any unearned
1472commission on the policy, and the insurer shall:
1473     (A)  Pay to the producing agent of record of the
1474corporation policy, for the first year, an amount that is the
1475greater of the insurer's usual and customary commission for the
1476type of policy written or a fee equal to the usual and customary
1477commission of the corporation; or
1478     (B)  Offer to allow the producing agent of record of the
1479corporation policy to continue servicing the policy for a period
1480of not less than 1 year and offer to pay the agent the greater
1481of the insurer's or the corporation's usual and customary
1482commission for the type of policy written.
1483
1484If the producing agent is unwilling or unable to accept
1485appointment, the new insurer shall pay the agent in accordance
1486with sub-sub-sub-subparagraph (A).
1487     b.  With respect to commercial lines residential risks, for
1488a new application to the corporation for coverage, if the risk
1489is offered coverage under a policy including wind coverage from
1490an authorized insurer at its approved rate, the risk is not
1491eligible for any policy issued by the corporation unless the
1492premium for coverage from the authorized insurer is more than 15
1493percent greater than the premium for comparable coverage from
1494the corporation. If the risk is not able to obtain any such
1495offer, the risk is eligible for a policy including wind coverage
1496issued by the corporation. However, with regard to a
1497policyholder of the corporation or a policyholder removed from
1498the corporation through an assumption agreement until the end of
1499the assumption period, the policyholder remains eligible for
1500coverage from the corporation regardless of any offer of
1501coverage from an authorized insurer or surplus lines insurer.
1502     (I)  If the risk accepts an offer of coverage through the
1503market assistance plan or an offer of coverage through a
1504mechanism established by the corporation before a policy is
1505issued to the risk by the corporation or during the first 30
1506days of coverage by the corporation, and the producing agent who
1507submitted the application to the plan or the corporation is not
1508currently appointed by the insurer, the insurer shall:
1509     (A)  Pay to the producing agent of record of the policy,
1510for the first year, an amount that is the greater of the
1511insurer's usual and customary commission for the type of policy
1512written or a fee equal to the usual and customary commission of
1513the corporation; or
1514     (B)  Offer to allow the producing agent of record of the
1515policy to continue servicing the policy for a period of not less
1516than 1 year and offer to pay the agent the greater of the
1517insurer's or the corporation's usual and customary commission
1518for the type of policy written.
1519
1520If the producing agent is unwilling or unable to accept
1521appointment, the new insurer shall pay the agent in accordance
1522with sub-sub-sub-subparagraph (A).
1523     (II)  When the corporation enters into a contractual
1524agreement for a take-out plan, the producing agent of record of
1525the corporation policy is entitled to retain any unearned
1526commission on the policy, and the insurer shall:
1527     (A)  Pay to the producing agent of record of the
1528corporation policy, for the first year, an amount that is the
1529greater of the insurer's usual and customary commission for the
1530type of policy written or a fee equal to the usual and customary
1531commission of the corporation; or
1532     (B)  Offer to allow the producing agent of record of the
1533corporation policy to continue servicing the policy for a period
1534of not less than 1 year and offer to pay the agent the greater
1535of the insurer's or the corporation's usual and customary
1536commission for the type of policy written.
1537
1538If the producing agent is unwilling or unable to accept
1539appointment, the new insurer shall pay the agent in accordance
1540with sub-sub-sub-subparagraph (A).
1541     c.  For purposes of determining comparable coverage under
1542sub-subparagraphs a. and b., the comparison shall be based on
1543those forms and coverages that are reasonably comparable. The
1544corporation may rely on a determination of comparable coverage
1545and premium made by the producing agent who submits the
1546application to the corporation, made in the agent's capacity as
1547the corporation's agent. A comparison may be made solely of the
1548premium with respect to the main building or structure only on
1549the following basis: the same coverage A or other building
1550limits; the same percentage hurricane deductible that applies on
1551an annual basis or that applies to each hurricane for commercial
1552residential property; the same percentage of ordinance and law
1553coverage, if the same limit is offered by both the corporation
1554and the authorized insurer; the same mitigation credits, to the
1555extent the same types of credits are offered both by the
1556corporation and the authorized insurer; the same method for loss
1557payment, such as replacement cost or actual cash value, if the
1558same method is offered both by the corporation and the
1559authorized insurer in accordance with underwriting rules; and
1560any other form or coverage that is reasonably comparable as
1561determined by the board. If an application is submitted to the
1562corporation for wind-only coverage in the high-risk account, the
1563premium for the corporation's wind-only policy plus the premium
1564for the ex-wind policy that is offered by an authorized insurer
1565to the applicant shall be compared to the premium for multiperil
1566coverage offered by an authorized insurer, subject to the
1567standards for comparison specified in this subparagraph. If the
1568corporation or the applicant requests from the authorized
1569insurer a breakdown of the premium of the offer by types of
1570coverage so that a comparison may be made by the corporation or
1571its agent and the authorized insurer refuses or is unable to
1572provide such information, the corporation may treat the offer as
1573not being an offer of coverage from an authorized insurer at the
1574insurer's approved rate.
1575     6.  Must include rules for classifications of risks and
1576rates therefor.
1577     7.  Must provide that if premium and investment income for
1578an account attributable to a particular calendar year are in
1579excess of projected losses and expenses for the account
1580attributable to that year, such excess shall be held in surplus
1581in the account. Such surplus shall be available to defray
1582deficits in that account as to future years and shall be used
1583for that purpose prior to assessing assessable insurers and
1584assessable insureds as to any calendar year.
1585     8.  Must provide objective criteria and procedures to be
1586uniformly applied for all applicants in determining whether an
1587individual risk is so hazardous as to be uninsurable. In making
1588this determination and in establishing the criteria and
1589procedures, the following shall be considered:
1590     a.  Whether the likelihood of a loss for the individual
1591risk is substantially higher than for other risks of the same
1592class; and
1593     b.  Whether the uncertainty associated with the individual
1594risk is such that an appropriate premium cannot be determined.
1595
1596The acceptance or rejection of a risk by the corporation shall
1597be construed as the private placement of insurance, and the
1598provisions of chapter 120 shall not apply.
1599     9.  Must provide that the corporation shall make its best
1600efforts to procure catastrophe reinsurance at reasonable rates,
1601to cover its projected 100-year probable maximum loss as
1602determined by the board of governors.
1603     10.  Must provide that in the event of regular deficit
1604assessments under sub-subparagraph (b)3.a. or sub-subparagraph
1605(b)3.b., in the personal lines account, the commercial lines
1606residential account, or the high-risk account, the corporation
1607shall levy upon corporation policyholders in its next rate
1608filing, or by a separate rate filing solely for this purpose, a
1609Citizens policyholder surcharge arising from a regular
1610assessment in such account in a percentage equal to the total
1611amount of such regular assessments divided by the aggregate
1612statewide direct written premium for subject lines of business
1613for the prior calendar year. For purposes of calculating the
1614Citizens policyholder surcharge to be levied under this
1615subparagraph, the total amount of the regular assessment to
1616which this surcharge is related shall be determined as set forth
1617in subparagraph (b)3., without deducting the estimated Citizens
1618policyholder surcharge. Citizens policyholder surcharges under
1619this subparagraph are not considered premium and are not subject
1620to commissions, fees, or premium taxes; however, failure to pay
1621a market equalization surcharge shall be treated as failure to
1622pay premium.
1623     10.11.  The policies issued by the corporation must provide
1624that, if the corporation or the market assistance plan obtains
1625an offer from an authorized insurer to cover the risk at its
1626approved rates, the risk is no longer eligible for renewal
1627through the corporation, except as otherwise provided in this
1628subsection.
1629     11.12.  Corporation policies and applications must include
1630a notice that the corporation policy could, under this section,
1631be replaced with a policy issued by an authorized insurer that
1632does not provide coverage identical to the coverage provided by
1633the corporation. The notice shall also specify that acceptance
1634of corporation coverage creates a conclusive presumption that
1635the applicant or policyholder is aware of this potential.
1636     12.13.  May establish, subject to approval by the office,
1637different eligibility requirements and operational procedures
1638for any line or type of coverage for any specified county or
1639area if the board determines that such changes to the
1640eligibility requirements and operational procedures are
1641justified due to the voluntary market being sufficiently stable
1642and competitive in such area or for such line or type of
1643coverage and that consumers who, in good faith, are unable to
1644obtain insurance through the voluntary market through ordinary
1645methods would continue to have access to coverage from the
1646corporation. When coverage is sought in connection with a real
1647property transfer, such requirements and procedures shall not
1648provide for an effective date of coverage later than the date of
1649the closing of the transfer as established by the transferor,
1650the transferee, and, if applicable, the lender.
1651     13.14.  Must provide that, with respect to the high-risk
1652account, any assessable insurer with a surplus as to
1653policyholders of $25 million or less writing 25 percent or more
1654of its total countrywide property insurance premiums in this
1655state may petition the office, within the first 90 days of each
1656calendar year, to qualify as a limited apportionment company. A
1657regular assessment levied by the corporation on a limited
1658apportionment company for a deficit incurred by the corporation
1659for the high-risk account in 2006 or thereafter may be paid to
1660the corporation on a monthly basis as the assessments are
1661collected by the limited apportionment company from its insureds
1662pursuant to s. 627.3512, but the regular assessment must be paid
1663in full within 12 months after being levied by the corporation.
1664A limited apportionment company shall collect from its
1665policyholders any emergency assessment imposed under sub-
1666subparagraph (b)3.d. The plan shall provide that, if the office
1667determines that any regular assessment will result in an
1668impairment of the surplus of a limited apportionment company,
1669the office may direct that all or part of such assessment be
1670deferred as provided in subparagraph (p)4. However, there shall
1671be no limitation or deferment of an emergency assessment to be
1672collected from policyholders under sub-subparagraph (b)3.d.
1673     14.15.  Must provide that the corporation appoint as its
1674licensed agents only those agents who also hold an appointment
1675as defined in s. 626.015(3) with an insurer who at the time of
1676the agent's initial appointment by the corporation is authorized
1677to write and is actually writing personal lines residential
1678property coverage, commercial residential property coverage, or
1679commercial nonresidential property coverage within the state.
1680     15.16.  Must provide, by July 1, 2007, a premium payment
1681plan option to its policyholders which allows at a minimum for
1682quarterly and semiannual payment of premiums. A monthly payment
1683plan may, but is not required to, be offered.
1684     16.17.  Must limit coverage on mobile homes or manufactured
1685homes built prior to 1994 to actual cash value of the dwelling
1686rather than replacement costs of the dwelling.
1687     17.18.  May provide such limits of coverage as the board
1688determines, consistent with the requirements of this subsection.
1689     18.19.  May require commercial property to meet specified
1690hurricane mitigation construction features as a condition of
1691eligibility for coverage.
1692     (m)1.  Rates for coverage provided by the corporation shall
1693be actuarially sound and subject to the requirements of s.
1694627.062, except as otherwise provided in this paragraph. The
1695corporation shall file its recommended rates with the office at
1696least annually. The corporation shall provide any additional
1697information regarding the rates which the office requires. The
1698office shall consider the recommendations of the board and issue
1699a final order establishing the rates for the corporation within
170045 days after the recommended rates are filed. The corporation
1701may not pursue an administrative challenge or judicial review of
1702the final order of the office.
1703     2.  In addition to the rates otherwise determined pursuant
1704to this paragraph, the corporation shall impose and collect an
1705amount equal to the premium tax provided for in s. 624.509 to
1706augment the financial resources of the corporation.
1707     3.  After the public hurricane loss-projection model under
1708s. 627.06281 has been found to be accurate and reliable by the
1709Florida Commission on Hurricane Loss Projection Methodology,
1710that model shall serve as the minimum benchmark for determining
1711the windstorm portion of the corporation's rates. This
1712subparagraph does not require or allow the corporation to adopt
1713rates lower than the rates otherwise required or allowed by this
1714paragraph.
1715     4.  The rate filings for the corporation which were
1716approved by the office and which took effect January 1, 2007,
1717are rescinded, except for those rates that were lowered. As soon
1718as possible, the corporation shall begin using the lower rates
1719that were in effect on December 31, 2006, and shall provide
1720refunds to policyholders who have paid higher rates as a result
1721of that rate filing. The rates in effect on December 31, 2006,
1722shall remain in effect for the 2007 and 2008 calendar years
1723except for any rate change that results in a lower rate. The
1724next rate change that may increase rates shall take effect
1725January 1, 2009, pursuant to a new rate filing recommended by
1726the corporation and established by the office, subject to the
1727requirements of this paragraph.
1728     5.a.  Beginning on January 15, 2009, and each year
1729thereafter, the corporation must make a recommended actuarially
1730sound rate filing for each personal and commercial line of
1731business it writes, to be effective no earlier than July 1,
17322009.
1733     b.  For the 36-month period beginning with the effective
1734date for each of the rate filings made by the corporation on
1735January 15, 2009, the rates established by the office for the
1736corporation for its personal residential multiperil policies,
1737its commercial residential multiperil policies, and its
1738commercial nonresidential multiperil policies may not result in
1739an overall average statewide premium increase of more than 10
1740percent or an increase for any single policyholder of more than
174110 percent, during the first 12-month period, and may not result
1742in an overall average statewide premium increase of more than 10
1743percent, or an increase for any single policyholder of more than
174410 percent, during each of the two subsequent 12-month periods,
1745excluding coverage changes and surcharges.
1746     c.  For the 36-month period beginning with the effective
1747date for the rate filings made by the corporation on January 15,
17482009, the rates established by the office for the corporation
1749for its personal residential wind-only policies, its commercial
1750residential wind-only policies, and its commercial
1751nonresidential wind-only policies may not result in an overall
1752average statewide premium increase of more than 10 percent, or
1753an increase for any single policyholder of more than 10 percent,
1754during the first 12-month period, and may not result in an
1755overall average statewide premium increase of more than 10
1756percent, or an increase for any single policyholder of more than
175710 percent, during each of the two subsequent 12-month periods,
1758excluding coverage changes and surcharges.
1759     (p)1.  The corporation shall certify to the office its
1760needs for annual assessments as to a particular calendar year,
1761and for any interim assessments that it deems to be necessary to
1762sustain operations as to a particular year pending the receipt
1763of annual assessments. Upon verification, the office shall
1764approve such certification, and the corporation shall levy such
1765annual or interim assessments. Such assessments shall be
1766prorated as provided in paragraph (b). The corporation shall
1767take all reasonable and prudent steps necessary to collect the
1768amount of assessment due from each assessable insurer,
1769including, if prudent, filing suit to collect such assessment.
1770If the corporation is unable to collect an assessment from any
1771assessable insurer, the uncollected assessments shall be levied
1772as an additional assessment against the assessable insurers and
1773any assessable insurer required to pay an additional assessment
1774as a result of such failure to pay shall have a cause of action
1775against such nonpaying assessable insurer. Assessments shall be
1776included as an appropriate factor in the making of rates. The
1777failure of a surplus lines agent to collect and remit any
1778regular or emergency assessment levied by the corporation is
1779considered to be a violation of s. 626.936 and subjects the
1780surplus lines agent to the penalties provided in that section.
1781     2.  The governing body of any unit of local government, any
1782residents of which are insured by the corporation, may issue
1783bonds as defined in s. 125.013 or s. 166.101 from time to time
1784to fund an assistance program, in conjunction with the
1785corporation, for the purpose of defraying deficits of the
1786corporation. In order to avoid needless and indiscriminate
1787proliferation, duplication, and fragmentation of such assistance
1788programs, any unit of local government, any residents of which
1789are insured by the corporation, may provide for the payment of
1790losses, regardless of whether or not the losses occurred within
1791or outside of the territorial jurisdiction of the local
1792government. Revenue bonds under this subparagraph may not be
1793issued until validated pursuant to chapter 75, unless a state of
1794emergency is declared by executive order or proclamation of the
1795Governor pursuant to s. 252.36 making such findings as are
1796necessary to determine that it is in the best interests of, and
1797necessary for, the protection of the public health, safety, and
1798general welfare of residents of this state and declaring it an
1799essential public purpose to permit certain municipalities or
1800counties to issue such bonds as will permit relief to claimants
1801and policyholders of the corporation. Any such unit of local
1802government may enter into such contracts with the corporation
1803and with any other entity created pursuant to this subsection as
1804are necessary to carry out this paragraph. Any bonds issued
1805under this subparagraph shall be payable from and secured by
1806moneys received by the corporation from emergency assessments
1807under sub-subparagraph (b)3.d., and assigned and pledged to or
1808on behalf of the unit of local government for the benefit of the
1809holders of such bonds. The funds, credit, property, and taxing
1810power of the state or of the unit of local government shall not
1811be pledged for the payment of such bonds. If any of the bonds
1812remain unsold 60 days after issuance, the office shall require
1813all insurers subject to assessment to purchase the bonds, which
1814shall be treated as admitted assets; each insurer shall be
1815required to purchase that percentage of the unsold portion of
1816the bond issue that equals the insurer's relative share of
1817assessment liability under this subsection. An insurer shall not
1818be required to purchase the bonds to the extent that the office
1819determines that the purchase would endanger or impair the
1820solvency of the insurer.
1821     3.a.  The corporation shall adopt one or more programs
1822subject to approval by the office for the reduction of both new
1823and renewal writings in the corporation. Beginning January 1,
18242008, any program the corporation adopts for the payment of
1825bonuses to an insurer for each risk the insurer removes from the
1826corporation shall comply with s. 627.3511(2) and may not exceed
1827the amount referenced in s. 627.3511(2) for each risk removed.
1828The corporation may consider any prudent and not unfairly
1829discriminatory approach to reducing corporation writings, and
1830may adopt a credit against assessment liability or other
1831liability that provides an incentive for insurers to take risks
1832out of the corporation and to keep risks out of the corporation
1833by maintaining or increasing voluntary writings in counties or
1834areas in which corporation risks are highly concentrated and a
1835program to provide a formula under which an insurer voluntarily
1836taking risks out of the corporation by maintaining or increasing
1837voluntary writings will be relieved wholly or partially from
1838assessments under sub-subparagraphs (b)3.a. and b. However, any
1839"take-out bonus" or payment to an insurer must be conditioned on
1840the property being insured for at least 5 years by the insurer,
1841unless canceled or nonrenewed by the policyholder. If the policy
1842is canceled or nonrenewed by the policyholder before the end of
1843the 5-year period, the amount of the take-out bonus must be
1844prorated for the time period the policy was insured. When the
1845corporation enters into a contractual agreement for a take-out
1846plan, the producing agent of record of the corporation policy is
1847entitled to retain any unearned commission on such policy, and
1848the insurer shall either:
1849     (I)  Pay to the producing agent of record of the policy,
1850for the first year, an amount which is the greater of the
1851insurer's usual and customary commission for the type of policy
1852written or a policy fee equal to the usual and customary
1853commission of the corporation; or
1854     (II)  Offer to allow the producing agent of record of the
1855policy to continue servicing the policy for a period of not less
1856than 1 year and offer to pay the agent the insurer's usual and
1857customary commission for the type of policy written. If the
1858producing agent is unwilling or unable to accept appointment by
1859the new insurer, the new insurer shall pay the agent in
1860accordance with sub-sub-subparagraph (I).
1861     b.  Any credit or exemption from regular assessments
1862adopted under this subparagraph shall last no longer than the 3
1863years following the cancellation or expiration of the policy by
1864the corporation. With the approval of the office, the board may
1865extend such credits for an additional year if the insurer
1866guarantees an additional year of renewability for all policies
1867removed from the corporation, or for 2 additional years if the
1868insurer guarantees 2 additional years of renewability for all
1869policies so removed.
1870     c.  There shall be no credit, limitation, exemption, or
1871deferment from emergency assessments to be collected from
1872policyholders pursuant to sub-subparagraph (b)3.d.
1873     4.  The plan shall provide for the deferment, in whole or
1874in part, of the assessment of an assessable insurer, other than
1875an emergency assessment collected from policyholders pursuant to
1876sub-subparagraph (b)3.d., if the office finds that payment of
1877the assessment would endanger or impair the solvency of the
1878insurer. In the event an assessment against an assessable
1879insurer is deferred in whole or in part, the amount by which
1880such assessment is deferred may be assessed against the other
1881assessable insurers in a manner consistent with the basis for
1882assessments set forth in paragraph (b).
1883     5.  Effective July 1, 2007, in order to evaluate the costs
1884and benefits of approved take-out plans, if the corporation pays
1885a bonus or other payment to an insurer for an approved take-out
1886plan, it shall maintain a record of the address or such other
1887identifying information on the property or risk removed in order
1888to track if and when the property or risk is later insured by
1889the corporation.
1890     6.  Any policy taken out, assumed, or removed from the
1891corporation is, as of the effective date of the take-out,
1892assumption, or removal, direct insurance issued by the insurer
1893and not by the corporation, even if the corporation continues to
1894service the policies. This subparagraph applies to policies of
1895the corporation and not policies taken out, assumed, or removed
1896from any other entity.
1897     (w)1.  The following records of the corporation are
1898confidential and exempt from the provisions of s. 119.07(1) and
1899s. 24(a), Art. I of the State Constitution:
1900     a.  Underwriting files, except that a policyholder or an
1901applicant shall have access to his or her own underwriting
1902files. Confidential and exempt underwriting file records may
1903also be released to other governmental agencies upon written
1904request and demonstration of need; such records held by the
1905receiving agency remain confidential and exempt as provided
1906herein.
1907     b.  Claims files, until termination of all litigation and
1908settlement of all claims arising out of the same incident,
1909although portions of the claims files may remain exempt, as
1910otherwise provided by law. Confidential and exempt claims file
1911records may be released to other governmental agencies upon
1912written request and demonstration of need; such records held by
1913the receiving agency remain confidential and exempt as provided
1914for herein.
1915     c.  Records obtained or generated by an internal auditor
1916pursuant to a routine audit, until the audit is completed, or if
1917the audit is conducted as part of an investigation, until the
1918investigation is closed or ceases to be active. An investigation
1919is considered "active" while the investigation is being
1920conducted with a reasonable, good faith belief that it could
1921lead to the filing of administrative, civil, or criminal
1922proceedings.
1923     d.  Matters reasonably encompassed in privileged attorney-
1924client communications.
1925     e.  Proprietary information licensed to the corporation
1926under contract and the contract provides for the confidentiality
1927of such proprietary information.
1928     f.  All information relating to the medical condition or
1929medical status of a corporation employee which is not relevant
1930to the employee's capacity to perform his or her duties, except
1931as otherwise provided in this paragraph. Information that which
1932is exempt shall include, but is not limited to, information
1933relating to workers' compensation, insurance benefits, and
1934retirement or disability benefits.
1935     g.  Upon an employee's entrance into the employee
1936assistance program, a program to assist any employee who has a
1937behavioral or medical disorder, substance abuse problem, or
1938emotional difficulty which affects the employee's job
1939performance, all records relative to that participation shall be
1940confidential and exempt from the provisions of s. 119.07(1) and
1941s. 24(a), Art. I of the State Constitution, except as otherwise
1942provided in s. 112.0455(11).
1943     h.  Information relating to negotiations for financing,
1944reinsurance, depopulation, or contractual services, until the
1945conclusion of the negotiations.
1946     i.  Minutes of closed meetings regarding underwriting
1947files, and minutes of closed meetings regarding an open claims
1948file until termination of all litigation and settlement of all
1949claims with regard to that claim, except that information
1950otherwise confidential or exempt by law shall will be redacted.
1951     2.  If When an authorized insurer is considering
1952underwriting a risk insured by the corporation, relevant
1953underwriting files and confidential claims files may be released
1954to the insurer provided the insurer agrees in writing, notarized
1955and under oath, to maintain the confidentiality of such files.
1956If When a file is transferred to an insurer that file is no
1957longer a public record because it is not held by an agency
1958subject to the provisions of the public records law.
1959Underwriting files and confidential claims files may also be
1960released to staff of and the board of governors of the market
1961assistance plan established pursuant to s. 627.3515, who must
1962retain the confidentiality of such files, except such files may
1963be released to authorized insurers that are considering assuming
1964the risks to which the files apply, provided the insurer agrees
1965in writing, notarized and under oath, to maintain the
1966confidentiality of such files. Finally, the corporation or the
1967board or staff of the market assistance plan may make the
1968following information obtained from underwriting files and
1969confidential claims files available to licensed general lines
1970insurance agents: name, address, and telephone number of the
1971residential property owner or insured; location of the risk;
1972rating information; loss history; and policy type. The receiving
1973licensed general lines insurance agent must retain the
1974confidentiality of the information received.
1975     3.  A policyholder who has filed suit against the
1976corporation has the right to discover the contents of his or her
1977own claims file to the same extent that discovery of such
1978contents would be available from a private insurer in litigation
1979as provided by the Florida Rules of Civil Procedure, the Florida
1980Evidence Code, and other applicable law. Pursuant to subpoena, a
1981third party has the right to discover the contents of an
1982insured's or applicant's underwriting or claims file to the same
1983extent that discovery of such contents would be available from a
1984private insurer by subpoena as provided by the Florida Rules of
1985Civil Procedure, the Florida Evidence Code, and other applicable
1986law, and subject to any confidentiality protections requested by
1987the corporation and agreed to by the seeking party or ordered by
1988the court. The corporation may release confidential underwriting
1989and claims file contents and information as it deems necessary
1990and appropriate to underwrite or service insurance policies and
1991claims, subject to any confidentiality protections deemed
1992necessary and appropriate by the corporation.
1993     4.2.  Portions of meetings of the corporation are exempt
1994from the provisions of s. 286.011 and s. 24(b), Art. I of the
1995State Constitution wherein confidential underwriting files or
1996confidential open claims files are discussed. All portions of
1997corporation meetings which are closed to the public shall be
1998recorded by a court reporter. The court reporter shall record
1999the times of commencement and termination of the meeting, all
2000discussion and proceedings, the names of all persons present at
2001any time, and the names of all persons speaking. No portion of
2002any closed meeting shall be off the record. Subject to the
2003provisions hereof and s. 119.07(1)(e)-(g), the court reporter's
2004notes of any closed meeting shall be retained by the corporation
2005for a minimum of 5 years. A copy of the transcript, less any
2006exempt matters, of any closed meeting wherein claims are
2007discussed shall become public as to individual claims after
2008settlement of the claim.
2009     (dd)1.  For policies subject to nonrenewal as a result of
2010the risk being no longer eligible for coverage due to being
2011valued at $1 million or more, the corporation shall, directly or
2012through the market assistance plan, make information from
2013confidential underwriting and claims files of policyholders
2014available only to licensed general lines agents who register
2015with the corporation to receive such information according to
2016the following procedures:
2017     2.  By August 1, 2006, the corporation shall provide such
2018policyholders who are not eligible for renewal the opportunity
2019to request in writing, within 30 days after the notification is
2020sent, that information from their confidential underwriting and
2021claims files not be released to licensed general lines agents
2022registered pursuant to this paragraph.
2023     3.  By August 1, 2006, the corporation shall make available
2024to licensed general lines agents the registration procedures to
2025be used to obtain confidential information from underwriting and
2026claims files for such policies not eligible for renewal. As a
2027condition of registration, the corporation shall require the
2028licensed general lines agent to attest that the agent has the
2029experience and relationships with authorized or surplus lines
2030carriers to attempt to offer replacement coverage for such
2031policies.
2032     4.  By September 1, 2006, the corporation shall make
2033available through a secured website to licensed general lines
2034agents registered pursuant to this paragraph application,
2035rating, loss history, mitigation, and policy type information
2036relating to such policies not eligible for renewal and for which
2037the policyholder has not requested the corporation withhold such
2038information. The registered licensed general lines agent may use
2039such information to contact and assist the policyholder in
2040securing replacement policies, and the agent may disclose to the
2041policyholder that such information was obtained from the
2042corporation.
2043     (dd)(ee)  The assets of the corporation may be invested and
2044managed by the State Board of Administration.
2045     (ee)(ff)  The office may establish a pilot program to offer
2046optional sinkhole coverage in one or more counties or other
2047territories of the corporation for the purpose of implementing
2048s. 627.706, as amended by s. 30, chapter 2007-1, Laws of
2049Florida. Under the pilot program, the corporation is not
2050required to issue a notice of nonrenewal to exclude sinkhole
2051coverage upon the renewal of existing policies, but may exclude
2052such coverage using a notice of coverage change.
2053     (ff)  The corporation shall report claims data and
2054histories to a consumer reporting agency, as defined by the
2055federal Fair Credit Reporting Act, 15 U.S.C. 1681 et seq., that
2056maintains a national database of similar data for use in
2057connection with the underwriting of insurance involving a
2058consumer.
2059     Section 12.  Paragraph (b) of subsection (2) of section
2060627.4133, Florida Statutes, is amended to read:
2061     627.4133  Notice of cancellation, nonrenewal, or renewal
2062premium.--
2063     (2)  With respect to any personal lines or commercial
2064residential property insurance policy, including, but not
2065limited to, any homeowner's, mobile home owner's, farmowner's,
2066condominium association, condominium unit owner's, apartment
2067building, or other policy covering a residential structure or
2068its contents:
2069     (b)  The insurer shall give the named insured written
2070notice of nonrenewal, cancellation, or termination at least 100
2071days prior to the effective date of the nonrenewal,
2072cancellation, or termination. However, the insurer shall give at
2073least 100 days' written notice, or written notice by June 1,
2074whichever is earlier, for any nonrenewal, cancellation, or
2075termination that would be effective between June 1 and November
207630. The notice must include the reason or reasons for the
2077nonrenewal, cancellation, or termination, except that:
2078     1.  The insurer shall give the named insured written notice
2079of nonrenewal, cancellation, or termination at least 180 days
2080prior to the effective date of the nonrenewal, cancellation, or
2081termination for a named insured whose residential structure has
2082been insured by that insurer or an affiliated insurer for at
2083least a 5-year period immediately prior to date of the written
2084notice.
2085     2.1.  When cancellation is for nonpayment of premium, at
2086least 10 days' written notice of cancellation accompanied by the
2087reason therefor shall be given. As used in this subparagraph,
2088the term "nonpayment of premium" means failure of the named
2089insured to discharge when due any of her or his obligations in
2090connection with the payment of premiums on a policy or any
2091installment of such premium, whether the premium is payable
2092directly to the insurer or its agent or indirectly under any
2093premium finance plan or extension of credit, or failure to
2094maintain membership in an organization if such membership is a
2095condition precedent to insurance coverage. "Nonpayment of
2096premium" also means the failure of a financial institution to
2097honor an insurance applicant's check after delivery to a
2098licensed agent for payment of a premium, even if the agent has
2099previously delivered or transferred the premium to the insurer.
2100If a dishonored check represents the initial premium payment,
2101the contract and all contractual obligations shall be void ab
2102initio unless the nonpayment is cured within the earlier of 5
2103days after actual notice by certified mail is received by the
2104applicant or 15 days after notice is sent to the applicant by
2105certified mail or registered mail, and if the contract is void,
2106any premium received by the insurer from a third party shall be
2107refunded to that party in full.
2108     3.2.  When such cancellation or termination occurs during
2109the first 90 days during which the insurance is in force and the
2110insurance is canceled or terminated for reasons other than
2111nonpayment of premium, at least 20 days' written notice of
2112cancellation or termination accompanied by the reason therefor
2113shall be given except where there has been a material
2114misstatement or misrepresentation or failure to comply with the
2115underwriting requirements established by the insurer.
2116     4.3.  The requirement for providing written notice of
2117nonrenewal by June 1 of any nonrenewal that would be effective
2118between June 1 and November 30 does not apply to the following
2119situations, but the insurer remains subject to the requirement
2120to provide such notice at least 100 days prior to the effective
2121date of nonrenewal:
2122     a.  A policy that is nonrenewed due to a revision in the
2123coverage for sinkhole losses and catastrophic ground cover
2124collapse pursuant to s. 627.730, as amended by s. 30, chapter
21252007-1, Laws of Florida.
2126     b.  A policy that is nonrenewed by Citizens Property
2127Insurance Corporation, pursuant to s. 627.351(6), for a policy
2128that has been assumed by an authorized insurer offering
2129replacement or renewal coverage to the policyholder.
2130
2131After the policy has been in effect for 90 days, the policy
2132shall not be canceled by the insurer except when there has been
2133a material misstatement, a nonpayment of premium, a failure to
2134comply with underwriting requirements established by the insurer
2135within 90 days of the date of effectuation of coverage, or a
2136substantial change in the risk covered by the policy or when the
2137cancellation is for all insureds under such policies for a given
2138class of insureds. This paragraph does not apply to individually
2139rated risks having a policy term of less than 90 days.
2140     Section 13.  Effective January 1, 2011, section 689.262,
2141Florida Statutes, is created to read:
2142     689.262  Sale of residential property; disclosure of
2143windstorm mitigation rating.--A purchaser of residential
2144property must be informed of the windstorm mitigation rating of
2145the structure, based on the uniform home grading scale adopted
2146pursuant to s. 215.55865. The rating must be included in the
2147contract for sale or as a separate document attached to the
2148contract for sale. The Financial Services Commission may adopt
2149rules, consistent with other state laws, to administer this
2150section, including the form of the disclosure and the
2151requirements for the windstorm mitigation inspection or report
2152that is required for purposes of determining the rating.
2153     Section 14.  (1)  By December 15, 2008, Citizens Property
2154Insurance Corporation shall transfer $250 million to the General
2155Revenue Fund if the combined surplus of each account as defined
2156in s. 627.351(6), Florida Statutes, exceeds $1 billion. The
2157board of governors of Citizens Property Insurance Corporation
2158must make a reasonable estimate of such surplus on or after
2159December 1, 2008, and no later than December 14, 2008, using
2160generally accepted actuarial and accounting practices,
2161recognizing that audited financial statements will not yet be
2162available.
2163     (2)  Beginning July 1, 2009, the board shall make quarterly
2164transfers of any interest earned prior to the issuance of any
2165surplus notes, interest paid, and principal repaid to the state
2166for any surplus notes issued by the program after December 1,
21672008, to Citizens Property Insurance Corporation, provided such
2168surplus notes were funded exclusively by an appropriation to the
2169program by the Legislature for the 2008-2009 fiscal year. The
2170corporation shall credit each account as defined in s.
2171627.351(6) in a pro rata manner for the funds removed from each
2172account to make the transfer required by subsection (11).
2173     Section 15.  Citizens Property Insurance Corporation may
2174not use any amendments made to s. 215.5595, Florida Statutes, by
2175this act or any transfer of funds authorized by this act as
2176justification or cause in seeking any rate or assessment
2177increase.
2178     Section 16.  Subsection (3) is added to section 627.06281,
2179Florida Statutes, to read:
2180     627.06281  Public hurricane loss projection model;
2181reporting of data by insurers.--
2182     (3)(a)  A residential property insurer may have access to
2183and use the public hurricane loss projection model, including
2184all assumptions and factors and all detailed loss results, for
2185the purpose of calculating rate indications in a rate filing and
2186for analytical purposes, including any analysis or evaluation of
2187the model required under actuarial standards of practice.
2188     (b)  By January 1, 2009, the office shall establish by rule
2189a fee schedule for access to and the use of the model. The fee
2190schedule must be reasonably calculated to cover only the actual
2191costs of providing access to and the use of the model.
2192     Section 17.  Section 627.0655, Florida Statutes, is amended
2193to read:
2194     627.0655  Policyholder loss or expense-related premium
2195discounts.--An insurer or person authorized to engage in the
2196business of insurance in this state may include, in the premium
2197charged an insured for any policy, contract, or certificate of
2198insurance, a discount based on the fact that another policy,
2199contract, or certificate of any type has been purchased by the
2200insured from the same insurer or insurer group, the Citizens
2201Property Insurance Corporation created under s. 627.351(6) if
2202the same insurance agent is servicing both policies, or an
2203insurer that has removed the policy from the Citizens Property
2204Insurance Corporation if the same insurance agent is servicing
2205both policies.
2206     Section 18.  (1)  The Citizens Property Insurance
2207Corporation Mission Review Task Force is created to analyze and
2208compile available data and to develop a report setting forth the
2209statutory and operational changes needed to return Citizens
2210Property Insurance Corporation to its former role as a state-
2211created, noncompetitive residual market mechanism that provides
2212property insurance coverage to risks that are otherwise entitled
2213but unable to obtain such coverage in the private insurance
2214market. The task force shall submit a report to the Governor,
2215the President of the Senate, and the Speaker of the House of
2216Representatives by January 31, 2009. At a minimum, the task
2217force shall analyze and evaluate relevant and applicable
2218information and data and develop recommendations concerning:
2219     (a)  The nature of Citizens Property Insurance
2220Corporation's role in providing property insurance coverage only
2221if such coverage is not available from private insurers.
2222     (b)  The ability of the admitted market to offer policies
2223to those consumers formerly insured through Citizens Property
2224Insurance Corporation. This consideration shall include, but not
2225be limited to, the availability of private market reinsurance
2226and coverage through the Florida Hurricane Catastrophe Fund, the
2227general adequacy of the admitted market's current rates, and the
2228capacity of the industry to offer policies to former Citizens
2229Property Insurance Corporation policyholders within existing
2230writing ratio limitations.
2231     (c)  The appropriate relationship of rates charged by
2232Citizens Property Insurance Corporation to rates charged by
2233private insurers, with due consideration for the corporation's
2234role as a noncompetitive residual market mechanism.
2235     (d)  The relationships between the exposure of Citizens
2236Property Insurance Corporation to catastrophic hurricane losses,
2237the corporation's history of purchasing inadequate or no
2238reinsurance coverage, and the corporation's lack of adequate
2239capital to meet its potential claim obligations without
2240incurring large deficits.
2241     (e)  The adverse effects on the people and the economy of
2242this state of the large, multiyear deficit assessments by
2243Citizens Property Insurance Corporation that may be levied on
2244businesses and households in this state, and steps that can be
2245taken to reduce those effects.
2246     (f)  The operational implications of the variation in the
2247number of policies in force over time in Citizens Property
2248Insurance Corporation and the merits of outsourcing some or all
2249of its operational responsibilities.
2250     (g)  Changes in the mission and operations of Citizens
2251Property Insurance Corporation to reduce or eliminate any
2252adverse effect such mission and operations may be having on the
2253promotion of sound and economic growth and development of the
2254coastal areas of this state.
2255     (h)  Appropriate and consistent geographic boundaries of
2256the high-risk account.
2257     (2)  The task force shall be composed of 19 members as
2258follows:
2259     (a)  Three members appointed by the Speaker of the House of
2260Representatives.
2261     (b)  Three members appointed by the President of the
2262Senate.
2263     (c)  Four members appointed by the Governor who are not
2264employed by or professionally affiliated with an insurance
2265company or a subsidiary of an insurance company, at least two of
2266whom must be consumer advocates or members of a consumer
2267advocacy organization or agency.
2268     (d)  Nine members appointed as representatives of private
2269insurance companies as follows:
2270     1.  Two members representing two separate insurance
2271companies that each provide at least 150,000 homeowner's
2272insurance policies in this state at the time of the creation of
2273the task force.
2274     2.  Two members representing two separate insurance
2275companies that each provide fewer than 150,000 homeowner's
2276insurance policies in this state at the time of the creation of
2277the task force.
2278     3.  Two members representing two separate insurance
2279companies among the 10 insurance companies writing the greatest
2280amount of commercial multiperil insurance premium in this state
2281at the time of the creation of the task force.
2282     4.  Three members appointed by the Chief Financial Officer
2283representing insurance agents in this state.
2284
2285Of each pair of members appointed under subparagraphs 1., 2.,
2286and 3., one shall be appointed by the President of the Senate
2287and one by the Speaker of the House of Representatives.
2288     (3)  The task force shall conduct research, hold public
2289meetings, receive testimony, employ consultants and
2290administrative staff, and undertake other activities determined
2291by its members to be necessary to complete its responsibilities.
2292Citizens Property Insurance Corporation shall have appropriate
2293senior staff attend task force meetings, shall respond to
2294requests for testimony and data by the task force, shall
2295otherwise cooperate with the task force, and shall provide
2296funding for the necessary costs of implementing the provisions
2297of this section.
2298     (4)  A member of the task force may not delegate his or her
2299attendance or voting power to a designee.
2300     (5)  Members of the task force shall serve without
2301compensation but are entitled to receive reimbursement for
2302travel and per diem as provided in s. 112.061, Florida Statutes.
2303     (6)  The appointments to the task force must be completed
2304within 30 calendar days after the effective date of this act,
2305and the task force must hold its initial meeting within 1 month
2306after appointment of all members. The task force shall expire no
2307later than 60 calendar days after submission of the report
2308required in subsection (1).
2309     Section 19.  Section 627.0621, Florida Statutes, is created
2310to read:
2311     627.0621  Transparency in rate regulation.--
2312     (1)  DEFINITIONS.-As used in this section, the term:
2313     (a)  "Rate Filing" means any original or amended rate
2314filing required or authorized under s. 627.062, s. 627.0651, or
2315chapter 2007-1, Laws of Florida.
2316     (b)  "Recommendation" means any proposed, preliminary, or
2317final recommendation from an office actuary reviewing a rate
2318filing with respect to the issue of approval or disapproval of
2319the rate filing or with respect to rate indications that the
2320office would consider acceptable.
2321     (2)  WEBSITE FOR PUBLIC ACCESS TO RATE FILING
2322INFORMATION.--With respect to any rate filing made on after July
23231, 2008, the office shall provide the following information on a
2324publicly accessible Internet website:
2325     (a)  The overall rate change requested by the insurer.
2326     (b)  All assumptions made by the office's actuaries.
2327     (c)  A statement describing any assumptions or methods that
2328deviate from the actuarial standards of practice of the Casualty
2329Actuarial Society or the American Academy of Actuaries,
2330including an explanation of the nature, rationale, and effect of
2331the deviation.
2332     (d)  All recommendations made by any office actuary who
2333reviewed the rate filing.
2334     (e)  Certification by the office's actuary under oath and
2335subject to the penalty of perjury that, based on the actuary's
2336knowledge, his or her recommendations did not contain any untrue
2337statement of a material fact or omit to state a material fact
2338necessary to make a recommendation and, in light of the
2339circumstances under which such recommendation was made, was not
2340misleading.
2341     (f)  The overall rate change approved by the office.
2342     (3)  ATTORNEY-CLIENT PRIVILEGE; WORK PRODUCT.--In any
2343administrative or judicial proceeding relating to a rate filing,
2344attorney-client privilege and work product exemptions from
2345disclosure do not apply to communications, including
2346communications with office attorneys or records prepared by or
2347at the direction of an office attorney, except when conditions
2348of paragraphs (a) and (b) have been met:
2349     (a)  The communication or record reflects a mental
2350impression, conclusion, litigation strategy, or legal theory of
2351the attorney or office.
2352     (b)  The communication or record was prepared after the
2353initiation of an action in a court of competent jurisdiction or
2354after the filing of a request for a proceeding under ss. 120.569  
2355and 120.57.
2356
2357Work product privilege claims that do not meet the conditions of
2358paragraphs (a) and (b) shall be deemed waived.
2359     Section 20.  Paragraph (b) of subsection (4) of section
2360215.555, Florida Statutes, is amended to read:
2361     215.555  Florida Hurricane Catastrophe Fund.--
2362     (4)  REIMBURSEMENT CONTRACTS.--
2363     (b)1.  The contract shall contain a promise by the board to
2364reimburse the insurer for 45 percent, 75 percent, or 90 percent
2365of its losses from each covered event in excess of the insurer's
2366retention, plus 5 percent of the reimbursed losses to cover loss
2367adjustment expenses.
2368     2.  The insurer must elect one of the percentage coverage
2369levels specified in this paragraph and may, upon renewal of a
2370reimbursement contract, elect a lower percentage coverage level
2371if no revenue bonds issued under subsection (6) after a covered
2372event are outstanding, or elect a higher percentage coverage
2373level, regardless of whether or not revenue bonds are
2374outstanding. All members of an insurer group must elect the same
2375percentage coverage level. Any joint underwriting association,
2376risk apportionment plan, or other entity created under s.
2377627.351 must elect the 90-percent coverage level.
2378     3.  The contract shall provide that reimbursement amounts
2379shall not be reduced by reinsurance paid or payable to the
2380insurer from other sources.
2381     4.  Notwithstanding any other provision contained in this
2382section, the board shall make available to insurers that
2383purchased coverage provided by this subparagraph in 2007 2006,
2384insurers qualifying as limited apportionment companies under s.
2385627.351(6)(c), and insurers that have been were approved to
2386participate in 2006 or that are approved in 2007 for the
2387Insurance Capital Build-Up Incentive Program pursuant to s.
2388215.5595, a contract or contract addendum that provides an
2389additional amount of reimbursement coverage of up to $10
2390million. The premium to be charged for this additional
2391reimbursement coverage shall be 50 percent of the additional
2392reimbursement coverage provided, which shall include one prepaid
2393reinstatement. The minimum retention level that an eligible
2394participating insurer must retain associated with this
2395additional coverage layer is 30 percent of the insurer's surplus
2396as of December 31, 2007 2006. This coverage shall be in addition
2397to all other coverage that may be provided under this section.
2398The coverage provided by the fund under this subparagraph shall
2399be in addition to the claims-paying capacity as defined in
2400subparagraph (c)1., but only with respect to those insurers that
2401select the additional coverage option and meet the requirements
2402of this subparagraph. The claims-paying capacity with respect to
2403all other participating insurers and limited apportionment
2404companies that do not select the additional coverage option
2405shall be limited to their reimbursement premium's proportionate
2406share of the actual claims-paying capacity otherwise defined in
2407subparagraph (c)1. and as provided for under the terms of the
2408reimbursement contract. Coverage provided in the reimbursement
2409contract shall will not be affected by the additional premiums
2410paid by participating insurers exercising the additional
2411coverage option allowed in this subparagraph. This subparagraph
2412expires on May 31, 2009 2008.
2413     Section 21.  Subsections (1) and (2) of section 627.712,
2414Florida Statutes, are amended to read:
2415     627.712  Residential windstorm coverage required;
2416availability of exclusions for windstorm or contents.--
2417     (1)  An insurer issuing a residential property insurance
2418policy must provide windstorm coverage. Except as provided in
2419paragraph (2)(c), this section subsection does not apply with
2420respect to risks that are eligible for wind-only coverage from
2421Citizens Property Insurance Corporation under s. 627.351(6).
2422     (2)  A property insurer must make available, at the option
2423of the policyholder, an exclusion of windstorm coverage.
2424     (a)  The coverage may be excluded only if:
2425     (a)1.  When the policyholder is a natural person, the
2426policyholder personally writes and provides to the insurer the
2427following statement in his or her own handwriting and signs his
2428or her name, which must also be signed by every other named
2429insured on the policy, and dated: "I do not want the insurance
2430on my (home/mobile home/condominium unit) to pay for damage from
2431windstorms. I will pay those costs. My insurance will not."
2432     2.  When the policyholder is other than a natural person,
2433the policyholder provides to the insurer on the policyholder's
2434letterhead the following statement that must be signed by the
2435policyholder's authorized representative and dated: "  (Name of
2436entity)   does not want the insurance on its   (type of
2437structure)   to pay for damage from windstorms.   (Name of
2438entity)   will be responsible for these costs.   (Name of
2439entity's)   insurance will not."
2440     (b)  If the structure insured by the policy is subject to a
2441mortgage or lien, the policyholder must provide the insurer with
2442a written statement from the mortgageholder or lienholder
2443indicating that the mortgageholder or lienholder approves the
2444policyholder electing to exclude windstorm coverage or hurricane
2445coverage from his or her or its property insurance policy.
2446     (c)  If the residential structure is eligible for wind-only
2447coverage from Citizens Property Insurance Corporation, an
2448insurer nonrenewing a policy and issuing a replacement policy,
2449or issuing a new policy, that does not provide wind coverage
2450shall provide a notice to the mortgageholder or lienholder
2451indicating the policyholder has elected coverage that does not
2452cover wind.
2453     Section 22.  Except as otherwise expressly provided in this
2454act, this act shall take effect July 1, 2008.
2455
2456
2457
2458
-----------------------------------------------------
2459
T I T L E  A M E N D M E N T
2460     Remove the entire title and insert:
2461
A bill to be entitled
2462An act relating to insurance; amending s. 215.5595, F.S.;
2463revising legislative findings; providing for an appropriation of
2464state funds in exchange for surplus notes issued by residential
2465property insurers under the program; revising the conditions and
2466requirements for providing funds to insurers under the program;
2467requiring a commitment by the insurer to meet minimum premium-
2468to-surplus writing ratios for residential property insurance and
2469for taking policies out of Citizens Property Insurance
2470Corporation; requiring insurers to commit to maintaining certain
2471levels of surplus and reinsurance; authorizing the State Board
2472of Administration to charge a fee for late payments; providing
2473for payment of costs and fees incurred by the board in
2474administering the program from funds appropriated to the
2475program, subject to a specified limit; requiring the board to
2476submit an annual report to the Legislature on the program and
2477insurer compliance with certain requirements; providing that
2478amendments made by the act do not affect the terms of surplus
2479notes approved prior to a specified date; authorizing the State
2480Board of Administration and an insurer to renegotiate such terms
2481consistent with such amendments; amending s. 624.3161, F.S.;
2482authorizing the Office of Insurance Regulation to require an
2483insurer to file its claims handling practices and procedures as
2484a public record based on findings of a market conduct
2485examination; amending s. 624.4211, F.S.; increasing the maximum
2486amounts of administrative fines that may be imposed upon an
2487insurer by the Office of Insurance Regulation for nonwillful and
2488willful violations of an order or rule of the office or any
2489provision of the Florida Insurance Code; creating s. 624.4213,
2490F.S.; specifying requirements for submission of a document or
2491information to the Office of Insurance Regulation or the
2492Department of Financial Services in order for a person to claim
2493that the document is a trade secret; requiring each page or
2494portion to be labeled as a trade secret and be separated from
2495non-trade secret material; requiring the submitting party to
2496include an affidavit certifying certain information about the
2497documents claimed to be trade secrets; requiring the office or
2498department to notify persons who submit trade secret documents
2499of any public-records request and the opportunity to file a
2500court action to bar disclosure; specifying conditions for the
2501office to retain or release such documents; creating s.
2502624.4305, F.S.; requiring that an insurer planning to nonrenew
2503more than a specified number of residential property insurance
2504polices notify the Office of Insurance Regulation and obtain
2505approval for such nonrenewals; specifying procedures for
2506issuance of such notice; amending s. 626.9521, F.S.; increasing
2507the maximum fines that may be imposed by the office or
2508department for nonwillful and willful violations of state law
2509regarding unfair methods of competition and unfair or deceptive
2510acts or practices related to insurance; amending s. 627.0612,
2511F.S.; providing criteria for administrative hearings to
2512determine whether an insurer's property insurance rates, rating
2513manuals, premium credits, discount schedules, and surcharge
2514schedules comply with the law; providing for entry of certain  
2515orders; amending s. 627.062, F.S.; revising the factors the
2516office must consider in reviewing a rate filing; prohibiting the
2517Office of Insurance Regulation from disapproving as excessive a
2518rate solely because the insurer obtained reinsurance covering a
2519specified probably maximum loss; allowing the office to
2520disapprove a rate as excessive within 1 year after the rate has
2521been approved under certain conditions related to nonrenewal of
2522policies by the insurer; requiring the Division of
2523Administrative Hearings to expedite a hearing request by an
2524insurer and for the administrative law judge to commence the
2525hearing within a specified time; authorizing an insurer to
2526request an expedited appellate review pursuant to the Florida
2527Rules of Appellate Procedure; expressing legislative intent for
2528an expedited appellate review; revising provisions relating to
2529the submission of a disputed rate filing, other than a rate
2530filing for medical malpractice insurance, to an arbitration
2531panel in lieu of an administrative hearing if the rate is filed
2532before a specified date; amending s. 627.0628, F.S.; providing
2533legislative findings relating to final agency action for
2534insurance ratemaking; requiring that with respect to rate
2535filings, insurers must use actuarial methods or models found to
2536be accurate or reliable by the Florida Commission on Hurricane
2537Loss Projection Methodology; providing for use of other models
2538under certain circumstances; deleting the requirement for the
2539Office of Insurance Regulation and the Consumer Advocate to have
2540access to all assumptions of a hurricane loss model in order for
2541a model that has been found to be accurate and reliable by the
2542Florida Commission on Hurricane Loss Projection Methodology to
2543be admissible in a rate proceeding; deleting cross-references to
2544conform to changes made by the act; amending s. 627.0629, F.S.;
2545requiring that the Office of Insurance Regulation develop and
2546make publicly available before a specified deadline a proposed
2547method for insurers to establish windstorm mitigation premium
2548discounts that correlate to the uniform home rating scale;
2549requiring that the Financial Services Commission adopt rules
2550before a specified deadline; requiring insurers to make rate
2551filings pursuant to such method; authorizing the commission to
2552make changes by rule to the uniform home grading scale and
2553specify by rule the minimum required discounts, credits, or
2554other rate differentials; requiring that such rate differentials
2555be consistent with generally accepted actuarial principles and
2556wind loss mitigation studies; amending s. 627.351, F.S.,
2557relating to Citizens Property Insurance Corporation; deleting
2558provisions defining the terms "homestead property" and
2559"nonhomestead property"; increasing threshold replacement costs
2560of certain structures for eligibility for coverage by the
2561corporation; deleting requirements for certain properties to
2562meeting building code plus requirements as a condition of
2563eligibility for coverage by the corporation; deleting outdated
2564provisions requiring the corporation to submit a report for
2565approval of offering multiperil coverage; revising threshold
2566amounts of deficits incurred in a calendar year on which the
2567decision to levy assessments and the types of such assessments
2568are based; revising the formula used to calculate shares of
2569assessments owed by certain assessable insureds; requiring that
2570the board of governors make certain determinations before
2571levying emergency assessments; providing the board of governors
2572with discretion to set the amount of an emergency assessment
2573within specified limits; requiring the board of governors to
2574levy a Citizens policyholder surcharge under certain conditions;
2575increasing the amount of the surcharge; deleting a provision
2576requiring the levy of an immediate assessment against certain
2577policyholders under such conditions; requiring that funds
2578collected from the levy of such surcharges be used for certain
2579purposes; providing that such surcharges are not considered
2580premium and are not subject to commissions, fees, or premium
2581taxes; requiring that the failure to pay such surcharges be
2582treated as failure to pay premium; requiring that the amount of
2583any assessment or surcharge which exceeds the amount of deficits
2584be remitted to and used by the corporation for specified
2585purposes; deleting provisions requiring that the plan of
2586operation of the corporation provide for the levy of a Citizens
2587policyholder surcharge if regular deficit assessments are levied
2588as a result of deficits in certain accounts; deleting provisions
2589related to the calculation, classification, and nonpayment of
2590such surcharge; requiring that the corporation make an annual
2591filing for each personal or commercial line of business it
2592writes, beginning on a specified date; limiting the overall
2593average statewide premium increase and the increase for an
2594individual policyholder to a specified amount for rates
2595established for certain policies during a specified period;
2596deleting a provision requiring an insurer to purchase bonds that
2597remain unsold;  deleting provisions requiring the corporation to
2598make certain confidential underwriting and claims files
2599available to agents to conform to changes made by the act
2600relating to ineligibility of certain dwellings; clarifying the
2601right of certain parties to discover underwriting and claims
2602file records; authorizing the corporation to release such
2603records as it deems necessary; requiring the corporation to
2604report certain information to a consumer reporting agency;
2605amending s. 627.4133, F.S.; requiring insurers to provide
2606written notice of certain cancellations, nonrenewals, or
2607terminations; creating s. 689.262, F.S.; requiring a purchaser
2608of residential property to be presented with the windstorm
2609mitigation rating of the structure; authorizing the Financial
2610Services Commission to adopt rules; requiring Citizens Property
2611Insurance Corporation to transfer funds to the General Revenue
2612Fund if the losses due to a hurricane do not exceed a specified
2613amount; requiring the board of governors of Citizens Property
2614Insurance Corporation to make a reasonable estimate of such
2615losses by a certain date; requiring the board to make quarterly
2616transfers of funds to the corporation under certain
2617circumstances; requiring the corporation to credit certain
2618accounts for funds removed to make certain transfers;
2619prohibiting Citizens Property Insurance Corporation from using
2620certain statutory changes or authorized transfers of funds as
2621justification or cause to seek any rate or assessment increase;
2622amending s. 627.06281, F.S.; providing for residential property
2623insurers to have access to and use a public hurricane loss
2624projection model; requiring the office to establish a fee
2625schedule for such model access and use; amending s. 627.0655,
2626F.S.; expanding application of policyholder loss or expense-
2627related premium discounts; creating the Citizens Property
2628Insurance Corporation Mission Review Task Force; providing
2629purposes; requiring a report; providing report requirements;
2630providing for appointment of members; providing
2631responsibilities; specifying service without compensation;
2632providing for reimbursement of per diem and travel expenses;
2633providing meeting requirements; requiring the corporation to
2634assist the task force; providing for the expiration of the task
2635force; requiring the Chief Financial Officer to provide a report
2636on the economic impact on the state of certain hurricanes;
2637providing report requirements; creating s. 627.0621, F.S.;
2638providing requirements for transparency in rate regulation;
2639providing definitions; providing for a website for public access
2640to rate filing information; providing requirements; providing
2641for application of public meeting requirements; specifying
2642nonapplication of attorney-client or work-product privileges to
2643certain communications in certain administrative or judicial
2644proceedings under certain circumstances; specifying criteria;
2645providing for waiver of such privileges under certain
2646circumstances; amending s. 215.555, F.S.; extending for an
2647additional year the offer of reimbursement coverage for
2648specified insurers; revising the qualifying criteria for such
2649insurers; revising provisions to conform; amending s. 627.712,
2650F.S.; requiring insurers to provide notice to mortgageholders or
2651lienholders of certain policies not providing wind coverage for
2652certain structures; providing effective dates.
2653


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