May 26, 2020
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HB 661

1
A bill to be entitled
2An act relating to minimum surplus requirements for
3mortgage guaranty insurers; amending s. 635.042, F.S.;
4authorizing the Commissioner of Insurance Regulation to
5permit a temporary exception to certain requirements under
6certain circumstances; revising authority of the Office of
7Insurance Regulation to take action against a noncomplying
8insurer under certain circumstances; providing an
9effective date.
10
11Be It Enacted by the Legislature of the State of Florida:
12
13     Section 1.  Section 635.042, Florida Statutes, is amended
14to read:
15     635.042  Minimum surplus requirement.-
16     (1)  A mortgage guaranty insurer shall maintain a minimum
17surplus of not less than the greater of $4 million or 10 percent
18of the insurer's total outstanding liabilities other than the
19required contingency reserve. A mortgage guaranty insurer is not
20required to have a surplus as to policyholders greater than $100
21million.
22     (2)  A mortgage guaranty insurer must possess sufficient
23capital and surplus so that the total outstanding aggregate
24exposure net of reinsurance under mortgage guaranty policies
25written by the insurer does not exceed 25 times its paid-in
26capital, surplus, and contingency reserve combined. A mortgage
27guaranty insurer shall disclose in the audited financial reports
28required under s. 624.424(8), the total aggregate exposure net
29of reinsurance under mortgage guaranty policies written by the
30insurer. The Commissioner of Insurance Regulation may permit a
31temporary exception to the requirements of this subsection at
32the written request of a mortgage guaranty insurer upon a
33finding that the mortgage guaranty insurer's financial position
34is reasonable in relationship to the mortgage guaranty insurer's
35aggregate insured risk and financial needs.
36     (3)  If a mortgage guaranty insurer is not in compliance
37with this section and has not been permitted an exception as
38provided in subsection (2), the office may take any action
39against the insurer that the office may take against an insurer
40that is not in compliance with s. 624.408.
41     Section 2.  This act shall take effect July 1, 2010.


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