Amendment
Bill No. CS/CS/CS/SB 408

Amendment No. 399507

CHAMBER ACTION
Senate		House
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1	Representative Wood offered the following:
2
3	Amendment (with title amendment)
4	Remove everything after the enacting clause and insert:
5	Section 1.  Subsection (2) of section 95.11, Florida
6	Statutes, is amended to read:
7	95.11  Limitations other than for the recovery of real
8	property.-Actions other than for recovery of real property shall
9	be commenced as follows:
10	(2)  WITHIN FIVE YEARS.-
11	(a)  An action on a judgment or decree of any court, not of
12	record, of this state or any court of the United States, any
13	other state or territory in the United States, or a foreign
14	country.
15	(b)  A legal or equitable action on a contract, obligation,
16	or liability founded on a written instrument, except for an
17	action to enforce a claim against a payment bond, which shall be
18	governed by the applicable provisions of ss. 255.05(10) and
19	713.23(1)(e).
20	(c)  An action to foreclose a mortgage.
21	(d)  An action alleging a willful violation of s. 448.110.
22	(e)  Notwithstanding paragraph (b), an action for breach of
23	a property insurance contract, with the period running from the
24	date of loss.
25	Section 2.  Effective June 1, 2011, paragraph (d) of
26	subsection (2) of section 215.555, Florida Statutes, is amended
27	to read:
28	215.555  Florida Hurricane Catastrophe Fund.-
29	(2)  DEFINITIONS.-As used in this section:
30	(d)  "Losses" means direct incurred losses under covered
31	policies, including which shall include losses for additional
32	living expenses not to exceed 40 percent of the insured value of
33	a residential structure or its contents and shall exclude loss
34	adjustment expenses. The term "Losses" does not include:
35	1.  Losses for fair rental value, loss of rent or rental
36	income, or business interruption losses;
37	2.  Losses under liability coverages;
38	3.  Property losses that are proximately caused by any
39	peril other than a covered event, including, but not limited to,
40	fire, theft, flood or rising water, or windstorm that does not
41	constitute a covered event;
42	4.  Amounts paid as the result of a voluntary expansion of
43	coverage by the insurer, including, but not limited to, a waiver
44	of an applicable deductible;
45	5.  Amounts paid to reimburse a policyholder for
46	condominium association or homeowners' association loss
47	assessments or under similar coverages for contractual
48	liabilities;
49	6.  Amounts paid as bad faith awards, punitive damage
50	awards, or other court-imposed fines, sanctions, or penalties;
51	7.  Amounts in excess of the coverage limits under the
52	covered policy; or
53	8.  Allocated or unallocated loss adjustment expenses.
54	Section 3.  The amendment to s. 215.555, Florida Statutes,
55	made by this act applies first to the Florida Hurricane
56	Catastrophe Fund reimbursement contract that takes effect June
57	1, 2011.
58	Section 4.  Subsection (12) is added to section 215.5595,
59	Florida Statutes, to read:
60	215.5595  Insurance Capital Build-Up Incentive Program.-
61	(12)  The insurer may request that the board renegotiate
62	the terms of any surplus note issued under this section before
63	January 1, 2011. The request must be submitted to the board by
64	January 1, 2012. If the insurer agrees to accelerate the payment
65	period of the note by at least 5 years, the board must agree to
66	exempt the insurer from the premium-to-surplus ratios required
67	under paragraph (2)(d). If the insurer agrees to an acceleration
68	of the payment period for less than 5 years, the board may,
69	after consultation with the Office of Insurance Regulation,
70	agree to an appropriate revision of the premium-to-surplus
71	ratios required under paragraph (2)(d) for the remaining term of
72	the note if the revised ratios are not lower than a minimum
73	writing ratio of net premium to surplus of at least 1 to 1 and,
74	alternatively, a minimum writing ratio of gross premium to
75	surplus of at least 3 to 1.
76	Section 5.  Section 624.407, Florida Statutes, is amended
77	to read:
78	624.407  Surplus Capital funds required; new insurers.-
79	(1)  To receive authority to transact any one kind or
80	combinations of kinds of insurance, as defined in part V of this
81	chapter, an insurer applying for its original certificate of
82	authority in this state after the effective date of this section
83	shall possess surplus as to policyholders at least not less than
84	the greater of:
85	(a)  Five million dollars For a property and casualty
86	insurer, $5 million, or $2.5 million for any other insurer;
87	(b)  For life insurers, 4 percent of the insurer's total
88	liabilities;
89	(c)  For life and health insurers, 4 percent of the
90	insurer's total liabilities, plus 6 percent of the insurer's
91	liabilities relative to health insurance; or
92	(d)  For all insurers other than life insurers and life and
93	health insurers, 10 percent of the insurer's total liabilities;
94	or
95	(e)  Notwithstanding paragraph (a) or paragraph (d), for a
96	domestic insurer that transacts residential property insurance
97	and is:
98	1.  Not a wholly owned subsidiary of an insurer domiciled
99	in any other state, $15 million.
100	2.  however, a domestic insurer that transacts residential
101	property insurance and is A wholly owned subsidiary of an
102	insurer domiciled in any other state, shall possess surplus as
103	to policyholders of at least $50 million.
104	(2)  Notwithstanding subsection (1), a new insurer may not
105	be required, but no insurer shall be required under this
106	subsection to have surplus as to policyholders greater than $100
107	million.
108	(3)(2)  The requirements of this section shall be based
109	upon all the kinds of insurance actually transacted or to be
110	transacted by the insurer in any and all areas in which it
111	operates, whether or not only a portion of such kinds of
112	insurance are to be transacted in this state.
113	(4)(3)  As to surplus as to policyholders required for
114	qualification to transact one or more kinds of insurance,
115	domestic mutual insurers are governed by chapter 628, and
116	domestic reciprocal insurers are governed by chapter 629.
117	(5)(4)  For the purposes of this section, liabilities do
118	shall not include liabilities required under s. 625.041(4). For
119	purposes of computing minimum surplus as to policyholders
120	pursuant to s. 625.305(1), liabilities shall include liabilities
121	required under s. 625.041(4).
122	(5)  The provisions of this section, as amended by this
123	act, shall apply only to insurers applying for a certificate of
124	authority on or after the effective date of this act.
125	Section 6.  Section 624.408, Florida Statutes, is amended
126	to read:
127	624.408  Surplus as to policyholders required; current new
128	and existing insurers.-
129	(1)(a)  To maintain a certificate of authority to transact
130	any one kind or combinations of kinds of insurance, as defined
131	in part V of this chapter, an insurer in this state must shall
132	at all times maintain surplus as to policyholders at least not
133	less than the greater of:
134	(a)1.  Except as provided in paragraphs (e), (f), and (g)
135	subparagraph 5. and paragraph (b), $1.5 million.;
136	(b)2.  For life insurers, 4 percent of the insurer's total
137	liabilities.;
138	(c)3.  For life and health insurers, 4 percent of the
139	insurer's total liabilities plus 6 percent of the insurer's
140	liabilities relative to health insurance.; or
141	(d)4.  For all insurers other than mortgage guaranty
142	insurers, life insurers, and life and health insurers, 10
143	percent of the insurer's total liabilities.
144	(e)5.  For property and casualty insurers, $4 million,
145	except for property and casualty insurers authorized to
146	underwrite any line of residential property insurance.
147	(f)(b)  For residential any property insurers not and
148	casualty insurer holding a certificate of authority before July
149	1, 2011 on December 1, 1993, $15 million. the
150	(g)  For residential property insurers holding a
151	certificate of authority before July 1, 2011, and until June 30,
152	2016, $5 million; on or after July 1, 2016, and until June 30,
153	2021, $10 million; on or after July 1, 2021, $15 million.
154
155	The office may reduce the surplus requirement in paragraphs (f)
156	and (g) if the insurer is not writing new business, has premiums
157	in force of less than $1 million per year in residential
158	property insurance, or is a mutual insurance company. following
159	amounts apply instead of the $4 million required by subparagraph
160	(a)5.:
161	1.  On December 31, 2001, and until December 30, 2002, $3
162	million.
163	2.  On December 31, 2002, and until December 30, 2003,
164	$3.25 million.
165	3.  On December 31, 2003, and until December 30, 2004, $3.6
166	million.
167	4.  On December 31, 2004, and thereafter, $4 million.
168	(2)  For purposes of this section, liabilities do shall not
169	include liabilities required under s. 625.041(4). For purposes
170	of computing minimum surplus as to policyholders pursuant to s.
171	625.305(1), liabilities shall include liabilities required under
172	s. 625.041(4).
173	(3)  This section does not require an No insurer shall be
174	required under this section to have surplus as to policyholders
175	greater than $100 million.
176	(4)  A mortgage guaranty insurer shall maintain a minimum
177	surplus as required by s. 635.042.
178	Section 7.  Subsection (7) is added to section 626.852,
179	Florida Statutes, to read:
180	626.852  Scope of this part.-
181	(7)  Notwithstanding any other provision of law, a person
182	who provides claims adjusting services solely to institutions
183	that service or guarantee mortgages with regard to policies
184	covering the mortgaged properties is exempt from licensure as an
185	adjuster. This exemption does not apply to any person who
186	provides insurance or to any affiliate of such person.
187	Section 8.  Effective June 1, 2011, section 626.854,
188	Florida Statutes, is amended to read:
189	626.854  "Public adjuster" defined; prohibitions.-The
190	Legislature finds that it is necessary for the protection of the
191	public to regulate public insurance adjusters and to prevent the
192	unauthorized practice of law.
193	(1)  A "public adjuster" is any person, except a duly
194	licensed attorney at law as hereinafter in s. 626.860 provided,
195	who, for money, commission, or any other thing of value,
196	prepares, completes, or files an insurance claim form for an
197	insured or third-party claimant or who, for money, commission,
198	or any other thing of value, acts or aids in any manner on
199	behalf of an insured or third-party claimant in negotiating for
200	or effecting the settlement of a claim or claims for loss or
201	damage covered by an insurance contract or who advertises for
202	employment as an adjuster of such claims, and also includes any
203	person who, for money, commission, or any other thing of value,
204	solicits, investigates, or adjusts such claims on behalf of any
205	such public adjuster.
206	(2)  This definition does not apply to:
207	(a)  A licensed health care provider or employee thereof
208	who prepares or files a health insurance claim form on behalf of
209	a patient.
210	(b)  A person who files a health claim on behalf of another
211	and does so without compensation.
212	(3)  A public adjuster may not give legal advice. A public
213	adjuster may not act on behalf of or aid any person in
214	negotiating or settling a claim relating to bodily injury,
215	death, or noneconomic damages.
216	(4)  For purposes of this section, the term "insured"
217	includes only the policyholder and any beneficiaries named or
218	similarly identified in the policy.
219	(5)  A public adjuster may not directly or indirectly
220	through any other person or entity solicit an insured or
221	claimant by any means except on Monday through Saturday of each
222	week and only between the hours of 8 a.m. and 8 p.m. on those
223	days.
224	(6)  A public adjuster may not directly or indirectly
225	through any other person or entity initiate contact or engage in
226	face-to-face or telephonic solicitation or enter into a contract
227	with any insured or claimant under an insurance policy until at
228	least 48 hours after the occurrence of an event that may be the
229	subject of a claim under the insurance policy unless contact is
230	initiated by the insured or claimant.
231	(7)  An insured or claimant may cancel a public adjuster's
232	contract to adjust a claim without penalty or obligation within
233	3 business days after the date on which the contract is executed
234	or within 3 business days after the date on which the insured or
235	claimant has notified the insurer of the claim, by phone or in
236	writing, whichever is later. The public adjuster's contract
237	shall disclose to the insured or claimant his or her right to
238	cancel the contract and advise the insured or claimant that
239	notice of cancellation must be submitted in writing and sent by
240	certified mail, return receipt requested, or other form of
241	mailing which provides proof thereof, to the public adjuster at
242	the address specified in the contract; provided, during any
243	state of emergency as declared by the Governor and for a period
244	of 1 year after the date of loss, the insured or claimant shall
245	have 5 business days after the date on which the contract is
246	executed to cancel a public adjuster's contract.
247	(8)  It is an unfair and deceptive insurance trade practice
248	pursuant to s. 626.9541 for a public adjuster or any other
249	person to circulate or disseminate any advertisement,
250	announcement, or statement containing any assertion,
251	representation, or statement with respect to the business of
252	insurance which is untrue, deceptive, or misleading.
253	(9)  A public adjuster, a public adjuster apprentice, or
254	any person or entity acting on behalf of a public adjuster or
255	public adjuster apprentice may not give or offer to give a
256	monetary loan or advance to a client or prospective client.
257	(10)  A public adjuster, public adjuster apprentice, or any
258	individual or entity acting on behalf of a public adjuster or
259	public adjuster apprentice may not give or offer to give,
260	directly or indirectly, any article of merchandise having a
261	value in excess of $25 to any individual for the purpose of
262	advertising or as an inducement to entering into a contract with
263	a public adjuster.
264	(11)(a)  If a public adjuster enters into a contract with
265	an insured or claimant to reopen a claim or to file a
266	supplemental claim that seeks additional payments for a claim
267	that has been previously paid in part or in full or settled by
268	the insurer, the public adjuster may not charge, agree to, or
269	accept any compensation, payment, commission, fee, or other
270	thing of value based on a previous settlement or previous claim
271	payments by the insurer for the same cause of loss. The charge,
272	compensation, payment, commission, fee, or other thing of value
273	may be based only on the claim payments or settlement obtained
274	through the work of the public adjuster after entering into the
275	contract with the insured or claimant. Compensation for the
276	reopened or supplemental claim may not exceed 20 percent of the
277	reopened or supplemental claim payment. The contracts described
278	in this paragraph are not subject to the limitations in
279	paragraph (b).
280	(b)  A public adjuster may not charge, agree to, or accept
281	any compensation, payment, commission, fee, or other thing of
282	value in excess of:
283	1.  Ten percent of the amount of insurance claim payments
284	made by the insurer for claims based on events that are the
285	subject of a declaration of a state of emergency by the
286	Governor. This provision applies to claims made during the
287	period of 1 year after the declaration of emergency. After that
288	1-year period, 20 percent of the amount of insurance claim
289	payments made by the insurer.
290	2.  Twenty percent of the amount of all other insurance
291	claim payments made by the insurer for claims that are not based
292	on events that are the subject of a declaration of a state of
293	emergency by the Governor.
294	(12)  Each public adjuster shall provide to the claimant or
295	insured a written estimate of the loss to assist in the
296	submission of a proof of loss or any other claim for payment of
297	insurance proceeds. The public adjuster shall retain such
298	written estimate for at least 5 years and shall make such
299	estimate available to the claimant or insured and the department
300	upon request.
301	(13)  A public adjuster, public adjuster apprentice, or any
302	person acting on behalf of a public adjuster or apprentice may
303	not accept referrals of business from any person with whom the
304	public adjuster conducts business if there is any form or manner
305	of agreement to compensate the person, whether directly or
306	indirectly, for referring business to the public adjuster. A
307	public adjuster may not compensate any person, except for
308	another public adjuster, whether directly or indirectly, for the
309	principal purpose of referring business to the public adjuster.
310
311	The provisions of subsections (5)-(13) apply only to residential
312	property insurance policies and condominium unit owner
313	association policies as defined in s. 718.111(11).
314	Section 9.  Effective January 1, 2012, section 626.854,
315	Florida Statutes, as amended by this act, is amended to read:
316	626.854  "Public adjuster" defined; prohibitions.-The
317	Legislature finds that it is necessary for the protection of the
318	public to regulate public insurance adjusters and to prevent the
319	unauthorized practice of law.
320	(1)  A "public adjuster" is any person, except a duly
321	licensed attorney at law as exempted under hereinafter in s.
322	626.860 provided, who, for money, commission, or any other thing
323	of value, prepares, completes, or files an insurance claim form
324	for an insured or third-party claimant or who, for money,
325	commission, or any other thing of value, acts or aids in any
326	manner on behalf of, or aids an insured or third-party claimant
327	in negotiating for or effecting the settlement of a claim or
328	claims for loss or damage covered by an insurance contract or
329	who advertises for employment as an adjuster of such claims. The
330	term, and also includes any person who, for money, commission,
331	or any other thing of value, solicits, investigates, or adjusts
332	such claims on behalf of a any such public adjuster.
333	(2)  This definition does not apply to:
334	(a)  A licensed health care provider or employee thereof
335	who prepares or files a health insurance claim form on behalf of
336	a patient.
337	(b)  A person who files a health claim on behalf of another
338	and does so without compensation.
339	(3)  A public adjuster may not give legal advice or. A
340	public adjuster may not act on behalf of or aid any person in
341	negotiating or settling a claim relating to bodily injury,
342	death, or noneconomic damages.
343	(4)  For purposes of this section, the term "insured"
344	includes only the policyholder and any beneficiaries named or
345	similarly identified in the policy.
346	(5)  A public adjuster may not directly or indirectly
347	through any other person or entity solicit an insured or
348	claimant by any means except on Monday through Saturday of each
349	week and only between the hours of 8 a.m. and 8 p.m. on those
350	days.
351	(6)  A public adjuster may not directly or indirectly
352	through any other person or entity initiate contact or engage in
353	face-to-face or telephonic solicitation or enter into a contract
354	with any insured or claimant under an insurance policy until at
355	least 48 hours after the occurrence of an event that may be the
356	subject of a claim under the insurance policy unless contact is
357	initiated by the insured or claimant.
358	(7)  An insured or claimant may cancel a public adjuster's
359	contract to adjust a claim without penalty or obligation within
360	3 business days after the date on which the contract is executed
361	or within 3 business days after the date on which the insured or
362	claimant has notified the insurer of the claim, by phone or in
363	writing, whichever is later. The public adjuster's contract must
364	shall disclose to the insured or claimant his or her right to
365	cancel the contract and advise the insured or claimant that
366	notice of cancellation must be submitted in writing and sent by
367	certified mail, return receipt requested, or other form of
368	mailing that which provides proof thereof, to the public
369	adjuster at the address specified in the contract; provided,
370	during any state of emergency as declared by the Governor and
371	for a period of 1 year after the date of loss, the insured or
372	claimant has shall have 5 business days after the date on which
373	the contract is executed to cancel a public adjuster's contract.
374	(8)  It is an unfair and deceptive insurance trade practice
375	pursuant to s. 626.9541 for a public adjuster or any other
376	person to circulate or disseminate any advertisement,
377	announcement, or statement containing any assertion,
378	representation, or statement with respect to the business of
379	insurance which is untrue, deceptive, or misleading.
380	(a)  The following statements, made in any public
381	adjuster's advertisement or solicitation, are considered
382	deceptive or misleading:
383	1.  A statement or representation that invites an insured
384	policyholder to submit a claim when the policyholder does not
385	have covered damage to insured property.
386	2.  A statement or representation that invites an insured
387	policyholder to submit a claim by offering monetary or other
388	valuable inducement.
389	3.  A statement or representation that invites an insured
390	policyholder to submit a claim by stating that there is "no
391	risk" to the policyholder by submitting such claim.
392	4.  A statement or representation, or use of a logo or
393	shield, that implies or could mistakenly be construed to imply
394	that the solicitation was issued or distributed by a
395	governmental agency or is sanctioned or endorsed by a
396	governmental agency.
397	(b)  For purposes of this paragraph, the term "written
398	advertisement" includes only newspapers, magazines, flyers, and
399	bulk mailers. The following disclaimer, which is not required to
400	be printed on standard size business cards, must be added in
401	bold print and capital letters in typeface no smaller than the
402	typeface of the body of the text to all written advertisements
403	by a public adjuster:
404	"THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD
405	A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU
406	ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU
407	MAY DISREGARD THIS ADVERTISEMENT."
408
409	(9)  A public adjuster, a public adjuster apprentice, or
410	any person or entity acting on behalf of a public adjuster or
411	public adjuster apprentice may not give or offer to give a
412	monetary loan or advance to a client or prospective client.
413	(10)  A public adjuster, public adjuster apprentice, or any
414	individual or entity acting on behalf of a public adjuster or
415	public adjuster apprentice may not give or offer to give,
416	directly or indirectly, any article of merchandise having a
417	value in excess of $25 to any individual for the purpose of
418	advertising or as an inducement to entering into a contract with
419	a public adjuster.
420	(11)(a)  If a public adjuster enters into a contract with
421	an insured or claimant to reopen a claim or file a supplemental
422	claim that seeks additional payments for a claim that has been
423	previously paid in part or in full or settled by the insurer,
424	the public adjuster may not charge, agree to, or accept any
425	compensation, payment, commission, fee, or other thing of value
426	based on a previous settlement or previous claim payments by the
427	insurer for the same cause of loss. The charge, compensation,
428	payment, commission, fee, or other thing of value must be based
429	only on the claim payments or settlement obtained through the
430	work of the public adjuster after entering into the contract
431	with the insured or claimant. Compensation for the reopened or
432	supplemental claim may not exceed 20 percent of the reopened or
433	supplemental claim payment. The contracts described in this
434	paragraph are not subject to the limitations in paragraph (b).
435	(b)  A public adjuster may not charge, agree to, or accept
436	any compensation, payment, commission, fee, or other thing of
437	value in excess of:
438	1.  Ten percent of the amount of insurance claim payments
439	made by the insurer for claims based on events that are the
440	subject of a declaration of a state of emergency by the
441	Governor. This provision applies to claims made during the year
442	after the declaration of emergency. After that year, the
443	limitations in subparagraph 2. apply.
444	2.  Twenty percent of the amount of insurance claim
445	payments made by the insurer for claims that are not based on
446	events that are the subject of a declaration of a state of
447	emergency by the Governor.
448	(12)  Each public adjuster must shall provide to the
449	claimant or insured a written estimate of the loss to assist in
450	the submission of a proof of loss or any other claim for payment
451	of insurance proceeds. The public adjuster shall retain such
452	written estimate for at least 5 years and shall make the such
453	estimate available to the claimant or insured, the insurer, and
454	the department upon request.
455	(13)  A public adjuster, public adjuster apprentice, or any
456	person acting on behalf of a public adjuster or apprentice may
457	not accept referrals of business from any person with whom the
458	public adjuster conducts business if there is any form or manner
459	of agreement to compensate the person, whether directly or
460	indirectly, for referring business to the public adjuster. A
461	public adjuster may not compensate any person, except for
462	another public adjuster, whether directly or indirectly, for the
463	principal purpose of referring business to the public adjuster.
464	(14)  A company employee adjuster, independent adjuster,
465	attorney, investigator, or other persons acting on behalf of an
466	insurer that needs access to an insured or claimant or to the
467	insured property that is the subject of a claim must provide at
468	least 48 hours' notice to the insured or claimant, public
469	adjuster, or legal representative before scheduling a meeting
470	with the claimant or an onsite inspection of the insured
471	property. The insured or claimant may deny access to the
472	property if the notice has not been provided. The insured or
473	claimant may waive the 48-hour notice.
474	(15)  A public adjuster must ensure prompt notice of
475	property loss claims submitted to an insurer by or through a
476	public adjuster or on which a public adjuster represents the
477	insured at the time the claim or notice of loss is submitted to
478	the insurer. The public adjuster must ensure that notice is
479	given to the insurer, the public adjuster's contract is provided
480	to the insurer, the property is available for inspection of the
481	loss or damage by the insurer, and the insurer is given an
482	opportunity to interview the insured directly about the loss and
483	claim. The insurer must be allowed to obtain necessary
484	information to investigate and respond to the claim.
485	(a)  The insurer may not exclude the public adjuster from
486	its in-person meetings with the insured. The insurer shall meet
487	or communicate with the public adjuster in an effort to reach
488	agreement as to the scope of the covered loss under the
489	insurance policy. This section does not impair the terms and
490	conditions of the insurance policy in effect at the time the
491	claim is filed.
492	(b)  A public adjuster may not restrict or prevent an
493	insurer, company employee adjuster, independent adjuster,
494	attorney, investigator, or other person acting on behalf of the
495	insurer from having reasonable access at reasonable times to an
496	insured or claimant or to the insured property that is the
497	subject of a claim.
498	(c)  A public adjuster may not act or fail to reasonably
499	act in any manner that obstructs or prevents an insurer or
500	insurer's adjuster from timely conducting an inspection of any
501	part of the insured property for which there is a claim for loss
502	or damage. The public adjuster representing the insured may be
503	present for the insurer's inspection, but if the unavailability
504	of the public adjuster otherwise delays the insurer's timely
505	inspection of the property, the public adjuster or the insured
506	must allow the insurer to have access to the property without
507	the participation or presence of the public adjuster or insured
508	in order to facilitate the insurer's prompt inspection of the
509	loss or damage.
510	(16)  A licensed contractor under part I of chapter 489, or
511	a subcontractor, may not adjust a claim on behalf of an insured
512	unless licensed and compliant as a public adjuster under this
513	chapter. However, the contractor may discuss or explain a bid
514	for construction or repair of covered property with the
515	residential property owner who has suffered loss or damage
516	covered by a property insurance policy, or the insurer of such
517	property, if the contractor is doing so for the usual and
518	customary fees applicable to the work to be performed as stated
519	in the contract between the contractor and the insured.
520	(17)  The provisions of subsections (5)-(16) (5)-(13) apply
521	only to residential property insurance policies and condominium
522	unit owner policies as defined in s. 718.111(11).
523	Section 10.  Effective January 1, 2012, section 626.8796,
524	Florida Statutes, is amended to read:
525	626.8796  Public adjuster contracts; fraud statement.-
526	(1)  All contracts for public adjuster services must be in
527	writing and must prominently display the following statement on
528	the contract: "Pursuant to s. 817.234, Florida Statutes, any
529	person who, with the intent to injure, defraud, or deceive an
530	any insurer or insured, prepares, presents, or causes to be
531	presented a proof of loss or estimate of cost or repair of
532	damaged property in support of a claim under an insurance policy
533	knowing that the proof of loss or estimate of claim or repairs
534	contains any false, incomplete, or misleading information
535	concerning any fact or thing material to the claim commits a
536	felony of the third degree, punishable as provided in s.
537	775.082, s. 775.083, or s. 775.084, Florida Statutes."
538	(2)  A public adjuster contract relating to a property and
539	casualty claim must contain the full name, permanent business
540	address, and license number of the public adjuster; the full
541	name of the public adjusting firm; and the insured's full name
542	and street address, together with a brief description of the
543	loss. The contract must state the percentage of compensation for
544	the public adjuster's services; the type of claim, including an
545	emergency claim, nonemergency claim, or supplemental claim; the
546	signatures of the public adjuster and all named insureds; and
547	the signature date. If all of the named insureds signatures are
548	not available, the public adjuster must submit an affidavit
549	signed by the available named insureds attesting that they have
550	authority to enter into the contract and settle all claim issues
551	on behalf of the named insureds. An unaltered copy of the
552	executed contract must be remitted to the insurer within 30 days
553	after execution.
554	Section 11.  Effective June 1, 2011, section 626.70132,
555	Florida Statutes, is created to read:
556	626.70132  Notice of windstorm or hurricane claim.-A claim,
557	supplemental claim, or reopened claim under an insurance policy
558	that provides property insurance, as defined in s. 624.604, for
559	loss or damage caused by the peril of windstorm or hurricane is
560	barred unless notice of the claim, supplemental claim, or
561	reopened claim was given to the insurer in accordance with the
562	terms of the policy within 3 years after the hurricane first
563	made landfall or the windstorm caused the covered damage. For
564	purposes of this section, the term "supplemental claim" or
565	"reopened claim" means any additional claim for recovery from
566	the insurer for losses from the same hurricane or windstorm
567	which the insurer has previously adjusted pursuant to the
568	initial claim. This section does not affect any applicable
569	limitation on civil actions provided in s. 95.11 for claims,
570	supplemental claims, or reopened claims timely filed under this
571	section.
572	Section 12.  Subsection (4) of section 627.0613, Florida
573	Statutes, is repealed.
574	Section 13.  Section 627.062, Florida Statutes, is amended
575	to read:
576	627.062  Rate standards.-
577	(1)  The rates for all classes of insurance to which the
578	provisions of this part are applicable may shall not be
579	excessive, inadequate, or unfairly discriminatory.
580	(2)  As to all such classes of insurance:
581	(a)  Insurers or rating organizations shall establish and
582	use rates, rating schedules, or rating manuals that to allow the
583	insurer a reasonable rate of return on the such classes of
584	insurance written in this state. A copy of rates, rating
585	schedules, rating manuals, premium credits or discount
586	schedules, and surcharge schedules, and changes thereto, must
587	shall be filed with the office under one of the following
588	procedures except as provided in subparagraph 3.:
589	1.  If the filing is made at least 90 days before the
590	proposed effective date and the filing is not implemented during
591	the office's review of the filing and any proceeding and
592	judicial review, then such filing is shall be considered a "file
593	and use" filing. In such case, the office shall finalize its
594	review by issuance of a notice of intent to approve or a notice
595	of intent to disapprove within 90 days after receipt of the
596	filing. The notice of intent to approve and the notice of intent
597	to disapprove constitute agency action for purposes of the
598	Administrative Procedure Act. Requests for supporting
599	information, requests for mathematical or mechanical
600	corrections, or notification to the insurer by the office of its
601	preliminary findings does shall not toll the 90-day period
602	during any such proceedings and subsequent judicial review. The
603	rate shall be deemed approved if the office does not issue a
604	notice of intent to approve or a notice of intent to disapprove
605	within 90 days after receipt of the filing.
606	2.  If the filing is not made in accordance with the
607	provisions of subparagraph 1., such filing must shall be made as
608	soon as practicable, but within no later than 30 days after the
609	effective date, and is shall be considered a "use and file"
610	filing. An insurer making a "use and file" filing is potentially
611	subject to an order by the office to return to policyholders
612	those portions of rates found to be excessive, as provided in
613	paragraph (h).
614	3.  For all property insurance filings made or submitted
615	after January 25, 2007, but before May 1, 2012 December 31,
616	2010, an insurer seeking a rate that is greater than the rate
617	most recently approved by the office shall make a "file and use"
618	filing. For purposes of this subparagraph, motor vehicle
619	collision and comprehensive coverages are not considered to be
620	property coverages.
621	(b)  Upon receiving a rate filing, the office shall review
622	the rate filing to determine if a rate is excessive, inadequate,
623	or unfairly discriminatory. In making that determination, the
624	office shall, in accordance with generally accepted and
625	reasonable actuarial techniques, consider the following factors:
626	1.  Past and prospective loss experience within and without
627	this state.
628	2.  Past and prospective expenses.
629	3.  The degree of competition among insurers for the risk
630	insured.
631	4.  Investment income reasonably expected by the insurer,
632	consistent with the insurer's investment practices, from
633	investable premiums anticipated in the filing, plus any other
634	expected income from currently invested assets representing the
635	amount expected on unearned premium reserves and loss reserves.
636	The commission may adopt rules using reasonable techniques of
637	actuarial science and economics to specify the manner in which
638	insurers shall calculate investment income attributable to such
639	classes of insurance written in this state and the manner in
640	which such investment income is shall be used to calculate
641	insurance rates. Such manner must shall contemplate allowances
642	for an underwriting profit factor and full consideration of
643	investment income which produce a reasonable rate of return;
644	however, investment income from invested surplus may not be
645	considered.
646	5.  The reasonableness of the judgment reflected in the
647	filing.
648	6.  Dividends, savings, or unabsorbed premium deposits
649	allowed or returned to Florida policyholders, members, or
650	subscribers.
651	7.  The adequacy of loss reserves.
652	8.  The cost of reinsurance. The office may shall not
653	disapprove a rate as excessive solely due to the insurer having
654	obtained catastrophic reinsurance to cover the insurer's
655	estimated 250-year probable maximum loss or any lower level of
656	loss.
657	9.  Trend factors, including trends in actual losses per
658	insured unit for the insurer making the filing.
659	10.  Conflagration and catastrophe hazards, if applicable.
660	11.  Projected hurricane losses, if applicable, which must
661	be estimated using a model or method found to be acceptable or
662	reliable by the Florida Commission on Hurricane Loss Projection
663	Methodology, and as further provided in s. 627.0628.
664	12.  A reasonable margin for underwriting profit and
665	contingencies.
666	13.  The cost of medical services, if applicable.
667	14.  Other relevant factors that affect which impact upon
668	the frequency or severity of claims or upon expenses.
669	(c)  In the case of fire insurance rates, consideration
670	must shall be given to the availability of water supplies and
671	the experience of the fire insurance business during a period of
672	not less than the most recent 5-year period for which such
673	experience is available.
674	(d)  If conflagration or catastrophe hazards are considered
675	given consideration by an insurer in its rates or rating plan,
676	including surcharges and discounts, the insurer shall establish
677	a reserve for that portion of the premium allocated to such
678	hazard and shall maintain the premium in a catastrophe reserve.
679	Any Removal of such premiums from the reserve for purposes other
680	than paying claims associated with a catastrophe or purchasing
681	reinsurance for catastrophes must be approved by shall be
682	subject to approval of the office. Any ceding commission
683	received by an insurer purchasing reinsurance for catastrophes
684	must shall be placed in the catastrophe reserve.
685	(e)  After consideration of the rate factors provided in
686	paragraphs (b), (c), and (d), the office may find a rate may be
687	found by the office to be excessive, inadequate, or unfairly
688	discriminatory based upon the following standards:
689	1.  Rates shall be deemed excessive if they are likely to
690	produce a profit from Florida business which that is
691	unreasonably high in relation to the risk involved in the class
692	of business or if expenses are unreasonably high in relation to
693	services rendered.
694	2.  Rates shall be deemed excessive if, among other things,
695	the rate structure established by a stock insurance company
696	provides for replenishment of surpluses from premiums, if when
697	the replenishment is attributable to investment losses.
698	3.  Rates shall be deemed inadequate if they are clearly
699	insufficient, together with the investment income attributable
700	to them, to sustain projected losses and expenses in the class
701	of business to which they apply.
702	4.  A rating plan, including discounts, credits, or
703	surcharges, shall be deemed unfairly discriminatory if it fails
704	to clearly and equitably reflect consideration of the
705	policyholder's participation in a risk management program
706	adopted pursuant to s. 627.0625.
707	5.  A rate shall be deemed inadequate as to the premium
708	charged to a risk or group of risks if discounts or credits are
709	allowed which exceed a reasonable reflection of expense savings
710	and reasonably expected loss experience from the risk or group
711	of risks.
712	6.  A rate shall be deemed unfairly discriminatory as to a
713	risk or group of risks if the application of premium discounts,
714	credits, or surcharges among such risks does not bear a
715	reasonable relationship to the expected loss and expense
716	experience among the various risks.
717	(f)  In reviewing a rate filing, the office may require the
718	insurer to provide, at the insurer's expense, all information
719	necessary to evaluate the condition of the company and the
720	reasonableness of the filing according to the criteria
721	enumerated in this section.
722	(g)  The office may at any time review a rate, rating
723	schedule, rating manual, or rate change; the pertinent records
724	of the insurer; and market conditions. If the office finds on a
725	preliminary basis that a rate may be excessive, inadequate, or
726	unfairly discriminatory, the office shall initiate proceedings
727	to disapprove the rate and shall so notify the insurer. However,
728	the office may not disapprove as excessive any rate for which it
729	has given final approval or which has been deemed approved for a
730	period of 1 year after the effective date of the filing unless
731	the office finds that a material misrepresentation or material
732	error was made by the insurer or was contained in the filing.
733	Upon being so notified, the insurer or rating organization
734	shall, within 60 days, file with the office all information that
735	which, in the belief of the insurer or organization, proves the
736	reasonableness, adequacy, and fairness of the rate or rate
737	change. The office shall issue a notice of intent to approve or
738	a notice of intent to disapprove pursuant to the procedures of
739	paragraph (a) within 90 days after receipt of the insurer's
740	initial response. In such instances and in any administrative
741	proceeding relating to the legality of the rate, the insurer or
742	rating organization shall carry the burden of proof by a
743	preponderance of the evidence to show that the rate is not
744	excessive, inadequate, or unfairly discriminatory. After the
745	office notifies an insurer that a rate may be excessive,
746	inadequate, or unfairly discriminatory, unless the office
747	withdraws the notification, the insurer may shall not alter the
748	rate except to conform to with the office's notice until the
749	earlier of 120 days after the date the notification was provided
750	or 180 days after the date of implementing the implementation of
751	the rate. The office may, subject to chapter 120, may disapprove
752	without the 60-day notification any rate increase filed by an
753	insurer within the prohibited time period or during the time
754	that the legality of the increased rate is being contested.
755	(h)  If In the event the office finds that a rate or rate
756	change is excessive, inadequate, or unfairly discriminatory, the
757	office shall issue an order of disapproval specifying that a new
758	rate or rate schedule, which responds to the findings of the
759	office, be filed by the insurer. The office shall further order,
760	for any "use and file" filing made in accordance with
761	subparagraph (a)2., that premiums charged each policyholder
762	constituting the portion of the rate above that which was
763	actuarially justified be returned to the such policyholder in
764	the form of a credit or refund. If the office finds that an
765	insurer's rate or rate change is inadequate, the new rate or
766	rate schedule filed with the office in response to such a
767	finding is shall be applicable only to new or renewal business
768	of the insurer written on or after the effective date of the
769	responsive filing.
770	(i)  Except as otherwise specifically provided in this
771	chapter, for property and casualty insurance the office may
772	shall not directly or indirectly:
773	1.  Prohibit any insurer, including any residual market
774	plan or joint underwriting association, from paying acquisition
775	costs based on the full amount of premium, as defined in s.
776	627.403, applicable to any policy, or prohibit any such insurer
777	from including the full amount of acquisition costs in a rate
778	filing; or.
779	2.  Impede, abridge, or otherwise compromise an insurer's
780	right to acquire policyholders, advertise, or appoint agents,
781	including the calculation, manner, or amount of such agent
782	commissions, if any.
783	(j)  With respect to residential property insurance rate
784	filings, the rate filing must account for mitigation measures
785	undertaken by policyholders to reduce hurricane losses.
786	(k)1.  A residential property An insurer may make a
787	separate filing limited solely to an adjustment of its rates for
788	reinsurance, the cost of financing products used as a
789	replacement for reinsurance, or financing costs incurred in the
790	purchase of reinsurance, or financing products to replace or
791	finance the payment of the amount covered by the Temporary
792	Increase in Coverage Limits (TICL) portion of the Florida
793	Hurricane Catastrophe Fund including replacement reinsurance for
794	the TICL reductions made pursuant to s. 215.555(17)(e); the
795	actual cost paid due to the application of the TICL premium
796	factor pursuant to s. 215.555(17)(f); and the actual cost paid
797	due to the application of the cash build-up factor pursuant to
798	s. 215.555(5)(b) if the insurer:
799	a.  Elects to purchase financing products such as a
800	liquidity instrument or line of credit, in which case the cost
801	included in the filing for the liquidity instrument or line of
802	credit may not result in a premium increase exceeding 3 percent
803	for any individual policyholder. All costs contained in the
804	filing may not result in an overall premium increase of more
805	than 15 10 percent for any individual policyholder.
806	b.  Includes in the filing a copy of all of its
807	reinsurance, liquidity instrument, or line of credit contracts;
808	proof of the billing or payment for the contracts; and the
809	calculation upon which the proposed rate change is based
810	demonstrating demonstrates that the costs meet the criteria of
811	this section and are not loaded for expenses or profit for the
812	insurer making the filing.
813	c.  Includes no other changes to its rates in the filing.
814	d.  Has not implemented a rate increase within the 6 months
815	immediately preceding the filing.
816	e.  Does not file for a rate increase under any other
817	paragraph within 6 months after making a filing under this
818	paragraph.
819	2.f.  An insurer that purchases reinsurance or financing
820	products from an affiliated company may make a separate filing
821	in compliance with this paragraph does so only if the costs for
822	such reinsurance or financing products are charged at or below
823	charges made for comparable coverage by nonaffiliated reinsurers
824	or financial entities making such coverage or financing products
825	available in this state.
826	3.2.  An insurer may only make only one filing per in any
827	12-month period under this paragraph.
828	4.3.  An insurer that elects to implement a rate change
829	under this paragraph must file its rate filing with the office
830	at least 45 days before the effective date of the rate change.
831	After an insurer submits a complete filing that meets all of the
832	requirements of this paragraph, the office has 45 days after the
833	date of the filing to review the rate filing and determine if
834	the rate is excessive, inadequate, or unfairly discriminatory.
835
836	The provisions of this subsection do shall not apply to workers'
837	compensation, and employer's liability insurance, and to motor
838	vehicle insurance.
839	(3)(a)  For individual risks that are not rated in
840	accordance with the insurer's rates, rating schedules, rating
841	manuals, and underwriting rules filed with the office and that
842	which have been submitted to the insurer for individual rating,
843	the insurer must maintain documentation on each risk subject to
844	individual risk rating. The documentation must identify the
845	named insured and specify the characteristics and classification
846	of the risk supporting the reason for the risk being
847	individually risk rated, including any modifications to existing
848	approved forms to be used on the risk. The insurer must maintain
849	these records for a period of at least 5 years after the
850	effective date of the policy.
851	(b)  Individual risk rates and modifications to existing
852	approved forms are not subject to this part or part II, except
853	for paragraph (a) and ss. 627.402, 627.403, 627.4035, 627.404,
854	627.405, 627.406, 627.407, 627.4085, 627.409, 627.4132,
855	627.4133, 627.415, 627.416, 627.417, 627.419, 627.425, 627.426,
856	627.4265, 627.427, and 627.428, but are subject to all other
857	applicable provisions of this code and rules adopted thereunder.
858	(c)  This subsection does not apply to private passenger
859	motor vehicle insurance.
860	(d)1.  The following categories or kinds of insurance and
861	types of commercial lines risks are not subject to paragraph
862	(2)(a) or paragraph (2)(f):
863	a.  Excess or umbrella.
864	b.  Surety and fidelity.
865	c.  Boiler and machinery and leakage and fire extinguishing
866	equipment.
867	d.  Errors and omissions.
868	e.  Directors and officers, employment practices, and
869	management liability.
870	f.  Intellectual property and patent infringement
871	liability.
872	g.  Advertising injury and Internet liability insurance.
873	h.  Property risks rated under a highly protected risks
874	rating plan.
875	i.  Any other commercial lines categories or kinds of
876	insurance or types of commercial lines risks that the office
877	determines should not be subject to paragraph (2)(a) or
878	paragraph (2)(f) because of the existence of a competitive
879	market for such insurance, similarity of such insurance to other
880	categories or kinds of insurance not subject to paragraph (2)(a)
881	or paragraph (2)(f), or to improve the general operational
882	efficiency of the office.
883	2.  Insurers or rating organizations shall establish and
884	use rates, rating schedules, or rating manuals to allow the
885	insurer a reasonable rate of return on insurance and risks
886	described in subparagraph 1. which are written in this state.
887	3.  An insurer must notify the office of any changes to
888	rates for insurance and risks described in subparagraph 1.
889	within no later than 30 days after the effective date of the
890	change. The notice must include the name of the insurer, the
891	type or kind of insurance subject to rate change, total premium
892	written during the immediately preceding year by the insurer for
893	the type or kind of insurance subject to the rate change, and
894	the average statewide percentage change in rates. Underwriting
895	files, premiums, losses, and expense statistics with regard to
896	such insurance and risks described in subparagraph 1. written by
897	an insurer must shall be maintained by the insurer and subject
898	to examination by the office. Upon examination, the office
899	shall, in accordance with generally accepted and reasonable
900	actuarial techniques, shall consider the rate factors in
901	paragraphs (2)(b), (c), and (d) and the standards in paragraph
902	(2)(e) to determine if the rate is excessive, inadequate, or
903	unfairly discriminatory.
904	4.  A rating organization must notify the office of any
905	changes to loss cost for insurance and risks described in
906	subparagraph 1. within no later than 30 days after the effective
907	date of the change. The notice must include the name of the
908	rating organization, the type or kind of insurance subject to a
909	loss cost change, loss costs during the immediately preceding
910	year for the type or kind of insurance subject to the loss cost
911	change, and the average statewide percentage change in loss
912	cost. Loss and exposure statistics with regard to risks
913	applicable to loss costs for a rating organization not subject
914	to paragraph (2)(a) or paragraph (2)(f) must shall be maintained
915	by the rating organization and are subject to examination by the
916	office. Upon examination, the office shall, in accordance with
917	generally accepted and reasonable actuarial techniques, shall
918	consider the rate factors in paragraphs (2)(b)-(d) and the
919	standards in paragraph (2)(e) to determine if the rate is
920	excessive, inadequate, or unfairly discriminatory.
921	5.  In reviewing a rate, the office may require the insurer
922	to provide, at the insurer's expense, all information necessary
923	to evaluate the condition of the company and the reasonableness
924	of the rate according to the applicable criteria described in
925	this section.
926	(4)  The establishment of any rate, rating classification,
927	rating plan or schedule, or variation thereof in violation of
928	part IX of chapter 626 is also in violation of this section. In
929	order to enhance the ability of consumers to compare premiums
930	and to increase the accuracy and usefulness of rate-comparison
931	information provided by the office to the public, the office
932	shall develop a proposed standard rating territory plan to be
933	used by all authorized property and casualty insurers for
934	residential property insurance. In adopting the proposed plan,
935	the office may consider geographical characteristics relevant to
936	risk, county lines, major roadways, existing rating territories
937	used by a significant segment of the market, and other relevant
938	factors. Such plan shall be submitted to the President of the
939	Senate and the Speaker of the House of Representatives by
940	January 15, 2006. The plan may not be implemented unless
941	authorized by further act of the Legislature.
942	(5)  With respect to a rate filing involving coverage of
943	the type for which the insurer is required to pay a
944	reimbursement premium to the Florida Hurricane Catastrophe Fund,
945	the insurer may fully recoup in its property insurance premiums
946	any reimbursement premiums paid to the Florida Hurricane
947	Catastrophe fund, together with reasonable costs of other
948	reinsurance; however, but except as otherwise provided in this
949	section, the insurer may not recoup reinsurance costs that
950	duplicate coverage provided by the Florida Hurricane Catastrophe
951	fund. An insurer may not recoup more than 1 year of
952	reimbursement premium at a time. Any under-recoupment from the
953	prior year may be added to the following year's reimbursement
954	premium, and any over-recoupment must shall be subtracted from
955	the following year's reimbursement premium.
956	(6)(a)  If an insurer requests an administrative hearing
957	pursuant to s. 120.57 related to a rate filing under this
958	section, the director of the Division of Administrative Hearings
959	shall expedite the hearing and assign an administrative law
960	judge who shall commence the hearing within 30 days after the
961	receipt of the formal request and shall enter a recommended
962	order within 30 days after the hearing or within 30 days after
963	receipt of the hearing transcript by the administrative law
964	judge, whichever is later. Each party shall have be allowed 10
965	days in which to submit written exceptions to the recommended
966	order. The office shall enter a final order within 30 days after
967	the entry of the recommended order. The provisions of this
968	paragraph may be waived upon stipulation of all parties.
969	(b)  Upon entry of a final order, the insurer may request a
970	expedited appellate review pursuant to the Florida Rules of
971	Appellate Procedure. It is the intent of the Legislature that
972	the First District Court of Appeal grant an insurer's request
973	for an expedited appellate review.
974	(7)(a)  The provisions of this subsection apply only with
975	respect to rates for medical malpractice insurance and shall
976	control to the extent of any conflict with other provisions of
977	this section.
978	(a)(b)  Any portion of a judgment entered or settlement
979	paid as a result of a statutory or common-law bad faith action
980	and any portion of a judgment entered which awards punitive
981	damages against an insurer may not be included in the insurer's
982	rate base, and shall not be used to justify a rate or rate
983	change. Any common-law bad faith action identified as such, any
984	portion of a settlement entered as a result of a statutory or
985	common-law action, or any portion of a settlement wherein an
986	insurer agrees to pay specific punitive damages may not be used
987	to justify a rate or rate change. The portion of the taxable
988	costs and attorney's fees which is identified as being related
989	to the bad faith and punitive damages in these judgments and
990	settlements may not be included in the insurer's rate base and
991	used may not be utilized to justify a rate or rate change.
992	(b)(c)  Upon reviewing a rate filing and determining
993	whether the rate is excessive, inadequate, or unfairly
994	discriminatory, the office shall consider, in accordance with
995	generally accepted and reasonable actuarial techniques, past and
996	present prospective loss experience, either using loss
997	experience solely for this state or giving greater credibility
998	to this state's loss data after applying actuarially sound
999	methods of assigning credibility to such data.
1000	(c)(d)  Rates shall be deemed excessive if, among other
1001	standards established by this section, the rate structure
1002	provides for replenishment of reserves or surpluses from
1003	premiums when the replenishment is attributable to investment
1004	losses.
1005	(d)(e)  The insurer must apply a discount or surcharge
1006	based on the health care provider's loss experience or shall
1007	establish an alternative method giving due consideration to the
1008	provider's loss experience. The insurer must include in the
1009	filing a copy of the surcharge or discount schedule or a
1010	description of the alternative method used, and must provide a
1011	copy of such schedule or description, as approved by the office,
1012	to policyholders at the time of renewal and to prospective
1013	policyholders at the time of application for coverage.
1014	(e)(f)  Each medical malpractice insurer must make a rate
1015	filing under this section, sworn to by at least two executive
1016	officers of the insurer, at least once each calendar year.
1017	(8)(a)1.  No later than 60 days after the effective date of
1018	medical malpractice legislation enacted during the 2003 Special
1019	Session D of the Florida Legislature, the office shall calculate
1020	a presumed factor that reflects the impact that the changes
1021	contained in such legislation will have on rates for medical
1022	malpractice insurance and shall issue a notice informing all
1023	insurers writing medical malpractice coverage of such presumed
1024	factor. In determining the presumed factor, the office shall use
1025	generally accepted actuarial techniques and standards provided
1026	in this section in determining the expected impact on losses,
1027	expenses, and investment income of the insurer. To the extent
1028	that the operation of a provision of medical malpractice
1029	legislation enacted during the 2003 Special Session D of the
1030	Florida Legislature is stayed pending a constitutional
1031	challenge, the impact of that provision shall not be included in
1032	the calculation of a presumed factor under this subparagraph.
1033	2.  No later than 60 days after the office issues its
1034	notice of the presumed rate change factor under subparagraph 1.,
1035	each insurer writing medical malpractice coverage in this state
1036	shall submit to the office a rate filing for medical malpractice
1037	insurance, which will take effect no later than January 1, 2004,
1038	and apply retroactively to policies issued or renewed on or
1039	after the effective date of medical malpractice legislation
1040	enacted during the 2003 Special Session D of the Florida
1041	Legislature. Except as authorized under paragraph (b), the
1042	filing shall reflect an overall rate reduction at least as great
1043	as the presumed factor determined under subparagraph 1. With
1044	respect to policies issued on or after the effective date of
1045	such legislation and prior to the effective date of the rate
1046	filing required by this subsection, the office shall order the
1047	insurer to make a refund of the amount that was charged in
1048	excess of the rate that is approved.
1049	(b)  Any insurer or rating organization that contends that
1050	the rate provided for in paragraph (a) is excessive, inadequate,
1051	or unfairly discriminatory shall separately state in its filing
1052	the rate it contends is appropriate and shall state with
1053	specificity the factors or data that it contends should be
1054	considered in order to produce such appropriate rate. The
1055	insurer or rating organization shall be permitted to use all of
1056	the generally accepted actuarial techniques provided in this
1057	section in making any filing pursuant to this subsection. The
1058	office shall review each such exception and approve or
1059	disapprove it prior to use. It shall be the insurer's burden to
1060	actuarially justify any deviations from the rates required to be
1061	filed under paragraph (a). The insurer making a filing under
1062	this paragraph shall include in the filing the expected impact
1063	of medical malpractice legislation enacted during the 2003
1064	Special Session D of the Florida Legislature on losses,
1065	expenses, and rates.
1066	(c)  If any provision of medical malpractice legislation
1067	enacted during the 2003 Special Session D of the Florida
1068	Legislature is held invalid by a court of competent
1069	jurisdiction, the office shall permit an adjustment of all
1070	medical malpractice rates filed under this section to reflect
1071	the impact of such holding on such rates so as to ensure that
1072	the rates are not excessive, inadequate, or unfairly
1073	discriminatory.
1074	(d)  Rates approved on or before July 1, 2003, for medical
1075	malpractice insurance shall remain in effect until the effective
1076	date of a new rate filing approved under this subsection.
1077	(e)  The calculation and notice by the office of the
1078	presumed factor pursuant to paragraph (a) is not an order or
1079	rule that is subject to chapter 120. If the office enters into a
1080	contract with an independent consultant to assist the office in
1081	calculating the presumed factor, such contract shall not be
1082	subject to the competitive solicitation requirements of s.
1083	287.057.
1084	(8)(9)(a)  The chief executive officer or chief financial
1085	officer of a property insurer and the chief actuary of a
1086	property insurer must certify under oath and subject to the
1087	penalty of perjury, on a form approved by the commission, the
1088	following information, which must accompany a rate filing:
1089	1.  The signing officer and actuary have reviewed the rate
1090	filing;
1091	2.  Based on the signing officer's and actuary's knowledge,
1092	the rate filing does not contain any untrue statement of a
1093	material fact or omit to state a material fact necessary in
1094	order to make the statements made, in light of the circumstances
1095	under which such statements were made, not misleading;
1096	3.  Based on the signing officer's and actuary's knowledge,
1097	the information and other factors described in paragraph (2)(b),
1098	including, but not limited to, investment income, fairly present
1099	in all material respects the basis of the rate filing for the
1100	periods presented in the filing; and
1101	4.  Based on the signing officer's and actuary's knowledge,
1102	the rate filing reflects all premium savings that are reasonably
1103	expected to result from legislative enactments and are in
1104	accordance with generally accepted and reasonable actuarial
1105	techniques.
1106	(b)  A signing officer or actuary who knowingly makes
1107	making a false certification under this subsection commits a
1108	violation of s. 626.9541(1)(e) and is subject to the penalties
1109	under s. 626.9521.
1110	(c)  Failure to provide such certification by the officer
1111	and actuary shall result in the rate filing being disapproved
1112	without prejudice to be refiled.
1113	(d)  The certification made pursuant to paragraph (a) is
1114	not rendered false if, after making the subject rate filing, the
1115	insurer provides the office with additional or supplementary
1116	information pursuant to a formal or informal request from the
1117	office. However, the actuary who is primarily responsible for
1118	preparing and submitting such information must certify the
1119	information in accordance with the certification required under
1120	paragraph (a) and the penalties in paragraph (b), except that
1121	the chief executive officer, chief financial officer, or chief
1122	actuary need not certify the additional or supplementary
1123	information.
1124	(e)(d)  The commission may adopt rules and forms pursuant
1125	to ss. 120.536(1) and 120.54 to administer this subsection.
1126	(9)(10)  The burden is on the office to establish that
1127	rates are excessive for personal lines residential coverage with
1128	a dwelling replacement cost of $1 million or more or for a
1129	single condominium unit with a combined dwelling and contents
1130	replacement cost of $1 million or more. Upon request of the
1131	office, the insurer shall provide to the office such loss and
1132	expense information as the office reasonably needs to meet this
1133	burden.
1134	(10)(11)  Any interest paid pursuant to s. 627.70131(5) may
1135	not be included in the insurer's rate base and may not be used
1136	to justify a rate or rate change.
1137	Section 14.  Paragraph (b) of subsection (3) of section
1138	627.06281, Florida Statutes, is amended to read:
1139	627.06281  Public hurricane loss projection model;
1140	reporting of data by insurers.-
1141	(3)
1142	(b)  The fees charged for private sector access and use of
1143	the model shall be the reasonable costs associated with the
1144	operation and maintenance of the model by the office. Such fees
1145	do not apply to access and use of the model by the office. By
1146	January 1, 2009, The office shall establish by rule a fee
1147	schedule for access to and the use of the model. The fee
1148	schedule must be reasonably calculated to cover only the actual
1149	costs of providing access to and the use of the model.
1150	Section 15.  Subsections (1) and (5) of section 627.0629,
1151	Florida Statutes, are amended to read:
1152	627.0629  Residential property insurance; rate filings.-
1153	(1)(a)  It is the intent of the Legislature that insurers
1154	must provide savings to consumers who install or implement
1155	windstorm damage mitigation techniques, alterations, or
1156	solutions to their properties to prevent windstorm losses. A
1157	rate filing for residential property insurance must include
1158	actuarially reasonable discounts, credits, or other rate
1159	differentials, or appropriate reductions in deductibles, for
1160	properties on which fixtures or construction techniques
1161	demonstrated to reduce the amount of loss in a windstorm have
1162	been installed or implemented. The fixtures or construction
1163	techniques must shall include, but are not be limited to,
1164	fixtures or construction techniques that which enhance roof
1165	strength, roof covering performance, roof-to-wall strength,
1166	wall-to-floor-to-foundation strength, opening protection, and
1167	window, door, and skylight strength. Credits, discounts, or
1168	other rate differentials, or appropriate reductions in
1169	deductibles, for fixtures and construction techniques that which
1170	meet the minimum requirements of the Florida Building Code must
1171	be included in the rate filing. All insurance companies must
1172	make a rate filing which includes the credits, discounts, or
1173	other rate differentials or reductions in deductibles by
1174	February 28, 2003. By July 1, 2007, the office shall reevaluate
1175	the discounts, credits, other rate differentials, and
1176	appropriate reductions in deductibles for fixtures and
1177	construction techniques that meet the minimum requirements of
1178	the Florida Building Code, based upon actual experience or any
1179	other loss relativity studies available to the office. The
1180	office shall determine the discounts, credits, other rate
1181	differentials, and appropriate reductions in deductibles that
1182	reflect the full actuarial value of such revaluation, which may
1183	be used by insurers in rate filings.
1184	(b)  By February 1, 2011, the Office of Insurance
1185	Regulation, in consultation with the Department of Financial
1186	Services and the Department of Community Affairs, shall develop
1187	and make publicly available a proposed method for insurers to
1188	establish discounts, credits, or other rate differentials for
1189	hurricane mitigation measures which directly correlate to the
1190	numerical rating assigned to a structure pursuant to the uniform
1191	home grading scale adopted by the Financial Services Commission
1192	pursuant to s. 215.55865, including any proposed changes to the
1193	uniform home grading scale. By October 1, 2011, the commission
1194	shall adopt rules requiring insurers to make rate filings for
1195	residential property insurance which revise insurers' discounts,
1196	credits, or other rate differentials for hurricane mitigation
1197	measures so that such rate differentials correlate directly to
1198	the uniform home grading scale. The rules may include such
1199	changes to the uniform home grading scale as the commission
1200	determines are necessary, and may specify the minimum required
1201	discounts, credits, or other rate differentials. Such rate
1202	differentials must be consistent with generally accepted
1203	actuarial principles and wind-loss mitigation studies. The rules
1204	shall allow a period of at least 2 years after the effective
1205	date of the revised mitigation discounts, credits, or other rate
1206	differentials for a property owner to obtain an inspection or
1207	otherwise qualify for the revised credit, during which time the
1208	insurer shall continue to apply the mitigation credit that was
1209	applied immediately prior to the effective date of the revised
1210	credit. Discounts, credits, and other rate differentials
1211	established for rate filings under this paragraph shall
1212	supersede, after adoption, the discounts, credits, and other
1213	rate differentials included in rate filings under paragraph (a).
1214	(5)  In order to provide an appropriate transition period,
1215	an insurer may, in its sole discretion, implement an approved
1216	rate filing for residential property insurance over a period of
1217	years. Such An insurer electing to phase in its rate filing must
1218	provide an informational notice to the office setting out its
1219	schedule for implementation of the phased-in rate filing. The An
1220	insurer may include in its rate the actual cost of private
1221	market reinsurance that corresponds to available coverage of the
1222	Temporary Increase in Coverage Limits, TICL, from the Florida
1223	Hurricane Catastrophe Fund. The insurer may also include the
1224	cost of reinsurance to replace the TICL reduction implemented
1225	pursuant to s. 215.555(17)(d)9. However, this cost for
1226	reinsurance may not include any expense or profit load or result
1227	in a total annual base rate increase in excess of 10 percent.
1228	Section 16.  Paragraphs (a), (b), (c), (d), (n), (v), and
1229	(y) of subsection (6) of section 627.351, Florida Statutes, are
1230	amended to read:
1231	627.351  Insurance risk apportionment plans.-
1232	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.-
1233	(a)1.  It is The public purpose of this subsection is to
1234	ensure that there is the existence of an orderly market for
1235	property insurance for residents Floridians and Florida
1236	businesses of this state.
1237	1.  The Legislature finds that private insurers are
1238	unwilling or unable to provide affordable property insurance
1239	coverage in this state to the extent sought and needed. The
1240	absence of affordable property insurance threatens the public
1241	health, safety, and welfare and likewise threatens the economic
1242	health of the state. The state therefore has a compelling public
1243	interest and a public purpose to assist in assuring that
1244	property in the state is insured and that it is insured at
1245	affordable rates so as to facilitate the remediation,
1246	reconstruction, and replacement of damaged or destroyed property
1247	in order to reduce or avoid the negative effects otherwise
1248	resulting to the public health, safety, and welfare, to the
1249	economy of the state, and to the revenues of the state and local
1250	governments which are needed to provide for the public welfare.
1251	It is necessary, therefore, to provide affordable property
1252	insurance to applicants who are in good faith entitled to
1253	procure insurance through the voluntary market but are unable to
1254	do so. The Legislature intends, therefore, by this subsection
1255	that affordable property insurance be provided and that it
1256	continue to be provided, as long as necessary, through Citizens
1257	Property Insurance Corporation, a government entity that is an
1258	integral part of the state, and that is not a private insurance
1259	company. To that end, the Citizens Property Insurance
1260	corporation shall strive to increase the availability of
1261	affordable property insurance in this state, while achieving
1262	efficiencies and economies, and while providing service to
1263	policyholders, applicants, and agents which is no less than the
1264	quality generally provided in the voluntary market, for the
1265	achievement of the foregoing public purposes. Because it is
1266	essential for this government entity to have the maximum
1267	financial resources to pay claims following a catastrophic
1268	hurricane, it is the intent of the Legislature that the Citizens
1269	Property Insurance corporation continue to be an integral part
1270	of the state and that the income of the corporation be exempt
1271	from federal income taxation and that interest on the debt
1272	obligations issued by the corporation be exempt from federal
1273	income taxation.
1274	2.  The Residential Property and Casualty Joint
1275	Underwriting Association originally created by this statute
1276	shall be known, as of July 1, 2002, as the Citizens Property
1277	Insurance Corporation. The corporation shall provide insurance
1278	for residential and commercial property, for applicants who are
1279	in good faith entitled, but, in good faith, are unable, to
1280	procure insurance through the voluntary market. The corporation
1281	shall operate pursuant to a plan of operation approved by order
1282	of the Financial Services Commission. The plan is subject to
1283	continuous review by the commission. The commission may, by
1284	order, withdraw approval of all or part of a plan if the
1285	commission determines that conditions have changed since
1286	approval was granted and that the purposes of the plan require
1287	changes in the plan. The corporation shall continue to operate
1288	pursuant to the plan of operation approved by the Office of
1289	Insurance Regulation until October 1, 2006. For the purposes of
1290	this subsection, residential coverage includes both personal
1291	lines residential coverage, which consists of the type of
1292	coverage provided by homeowner's, mobile home owner's, dwelling,
1293	tenant's, condominium unit owner's, and similar policies;, and
1294	commercial lines residential coverage, which consists of the
1295	type of coverage provided by condominium association, apartment
1296	building, and similar policies.
1297	3.  Effective January 1, 2009, a personal lines residential
1298	structure that has a dwelling replacement cost of $2 million or
1299	more, or a single condominium unit that has a combined dwelling
1300	and contents content replacement cost of $2 million or more is
1301	not eligible for coverage by the corporation. Such dwellings
1302	insured by the corporation on December 31, 2008, may continue to
1303	be covered by the corporation until the end of the policy term.
1304	However, such dwellings that are insured by the corporation and
1305	become ineligible for coverage due to the provisions of this
1306	subparagraph may reapply and obtain coverage if the property
1307	owner provides the corporation with a sworn affidavit from one
1308	or more insurance agents, on a form provided by the corporation,
1309	stating that the agents have made their best efforts to obtain
1310	coverage and that the property has been rejected for coverage by
1311	at least one authorized insurer and at least three surplus lines
1312	insurers. If such conditions are met, the dwelling may be
1313	insured by the corporation for up to 3 years, after which time
1314	the dwelling is ineligible for coverage. The office shall
1315	approve the method used by the corporation for valuing the
1316	dwelling replacement cost for the purposes of this subparagraph.
1317	If a policyholder is insured by the corporation prior to being
1318	determined to be ineligible pursuant to this subparagraph and
1319	such policyholder files a lawsuit challenging the determination,
1320	the policyholder may remain insured by the corporation until the
1321	conclusion of the litigation.
1322	4.  It is the intent of the Legislature that policyholders,
1323	applicants, and agents of the corporation receive service and
1324	treatment of the highest possible level but never less than that
1325	generally provided in the voluntary market. It is also is
1326	intended that the corporation be held to service standards no
1327	less than those applied to insurers in the voluntary market by
1328	the office with respect to responsiveness, timeliness, customer
1329	courtesy, and overall dealings with policyholders, applicants,
1330	or agents of the corporation.
1331	5.  Effective January 1, 2009, a personal lines residential
1332	structure that is located in the "wind-borne debris region," as
1333	defined in s. 1609.2, International Building Code (2006), and
1334	that has an insured value on the structure of $750,000 or more
1335	is not eligible for coverage by the corporation unless the
1336	structure has opening protections as required under the Florida
1337	Building Code for a newly constructed residential structure in
1338	that area. A residential structure shall be deemed to comply
1339	with the requirements of this subparagraph if it has shutters or
1340	opening protections on all openings and if such opening
1341	protections complied with the Florida Building Code at the time
1342	they were installed.
1343	6.  For any claim filed under any policy of the
1344	corporation, a public adjuster may not charge, agree to, or
1345	accept any compensation, payment, commission, fee, or other
1346	thing of value greater than 10 percent of the additional amount
1347	actually paid over the amount that was originally offered by the
1348	corporation for any one claim.
1349	(b)1.  All insurers authorized to write one or more subject
1350	lines of business in this state are subject to assessment by the
1351	corporation and, for the purposes of this subsection, are
1352	referred to collectively as "assessable insurers." Insurers
1353	writing one or more subject lines of business in this state
1354	pursuant to part VIII of chapter 626 are not assessable
1355	insurers, but insureds who procure one or more subject lines of
1356	business in this state pursuant to part VIII of chapter 626 are
1357	subject to assessment by the corporation and are referred to
1358	collectively as "assessable insureds." An authorized insurer's
1359	assessment liability begins shall begin on the first day of the
1360	calendar year following the year in which the insurer was issued
1361	a certificate of authority to transact insurance for subject
1362	lines of business in this state and terminates shall terminate 1
1363	year after the end of the first calendar year during which the
1364	insurer no longer holds a certificate of authority to transact
1365	insurance for subject lines of business in this state.
1366	2.a.  All revenues, assets, liabilities, losses, and
1367	expenses of the corporation shall be divided into three separate
1368	accounts as follows:
1369	(I)  A personal lines account for personal residential
1370	policies issued by the corporation, or issued by the Residential
1371	Property and Casualty Joint Underwriting Association and renewed
1372	by the corporation, which provides that provide comprehensive,
1373	multiperil coverage on risks that are not located in areas
1374	eligible for coverage by in the Florida Windstorm Underwriting
1375	Association as those areas were defined on January 1, 2002, and
1376	for such policies that do not provide coverage for the peril of
1377	wind on risks that are located in such areas;
1378	(II)  A commercial lines account for commercial residential
1379	and commercial nonresidential policies issued by the
1380	corporation, or issued by the Residential Property and Casualty
1381	Joint Underwriting Association and renewed by the corporation,
1382	which provides that provide coverage for basic property perils
1383	on risks that are not located in areas eligible for coverage by
1384	in the Florida Windstorm Underwriting Association as those areas
1385	were defined on January 1, 2002, and for such policies that do
1386	not provide coverage for the peril of wind on risks that are
1387	located in such areas; and
1388	(III)  A coastal high-risk account for personal residential
1389	policies and commercial residential and commercial
1390	nonresidential property policies issued by the corporation, or
1391	transferred to the corporation, which provides that provide
1392	coverage for the peril of wind on risks that are located in
1393	areas eligible for coverage by in the Florida Windstorm
1394	Underwriting Association as those areas were defined on January
1395	1, 2002. The corporation may offer policies that provide
1396	multiperil coverage and the corporation shall continue to offer
1397	policies that provide coverage only for the peril of wind for
1398	risks located in areas eligible for coverage in the coastal
1399	high-risk account. In issuing multiperil coverage, the
1400	corporation may use its approved policy forms and rates for the
1401	personal lines account. An applicant or insured who is eligible
1402	to purchase a multiperil policy from the corporation may
1403	purchase a multiperil policy from an authorized insurer without
1404	prejudice to the applicant's or insured's eligibility to
1405	prospectively purchase a policy that provides coverage only for
1406	the peril of wind from the corporation. An applicant or insured
1407	who is eligible for a corporation policy that provides coverage
1408	only for the peril of wind may elect to purchase or retain such
1409	policy and also purchase or retain coverage excluding wind from
1410	an authorized insurer without prejudice to the applicant's or
1411	insured's eligibility to prospectively purchase a policy that
1412	provides multiperil coverage from the corporation. It is the
1413	goal of the Legislature that there would be an overall average
1414	savings of 10 percent or more for a policyholder who currently
1415	has a wind-only policy with the corporation, and an ex-wind
1416	policy with a voluntary insurer or the corporation, and who then
1417	obtains a multiperil policy from the corporation. It is the
1418	intent of the Legislature that the offer of multiperil coverage
1419	in the coastal high-risk account be made and implemented in a
1420	manner that does not adversely affect the tax-exempt status of
1421	the corporation or creditworthiness of or security for currently
1422	outstanding financing obligations or credit facilities of the
1423	coastal high-risk account, the personal lines account, or the
1424	commercial lines account. The coastal high-risk account must
1425	also include quota share primary insurance under subparagraph
1426	(c)2. The area eligible for coverage under the coastal high-risk
1427	account also includes the area within Port Canaveral, which is
1428	bordered on the south by the City of Cape Canaveral, bordered on
1429	the west by the Banana River, and bordered on the north by
1430	Federal Government property.
1431	b.  The three separate accounts must be maintained as long
1432	as financing obligations entered into by the Florida Windstorm
1433	Underwriting Association or Residential Property and Casualty
1434	Joint Underwriting Association are outstanding, in accordance
1435	with the terms of the corresponding financing documents. If When
1436	the financing obligations are no longer outstanding, in
1437	accordance with the terms of the corresponding financing
1438	documents, the corporation may use a single account for all
1439	revenues, assets, liabilities, losses, and expenses of the
1440	corporation. Consistent with the requirement of this
1441	subparagraph and prudent investment policies that minimize the
1442	cost of carrying debt, the board shall exercise its best efforts
1443	to retire existing debt or to obtain the approval of necessary
1444	parties to amend the terms of existing debt, so as to structure
1445	the most efficient plan to consolidate the three separate
1446	accounts into a single account.
1447	c.  Creditors of the Residential Property and Casualty
1448	Joint Underwriting Association and of the accounts specified in
1449	sub-sub-subparagraphs a.(I) and (II) may have a claim against,
1450	and recourse to, those the accounts referred to in sub-sub-
1451	subparagraphs a.(I) and (II) and shall have no claim against, or
1452	recourse to, the account referred to in sub-sub-subparagraph
1453	a.(III). Creditors of the Florida Windstorm Underwriting
1454	Association shall have a claim against, and recourse to, the
1455	account referred to in sub-sub-subparagraph a.(III) and shall
1456	have no claim against, or recourse to, the accounts referred to
1457	in sub-sub-subparagraphs a.(I) and (II).
1458	d.  Revenues, assets, liabilities, losses, and expenses not
1459	attributable to particular accounts shall be prorated among the
1460	accounts.
1461	e.  The Legislature finds that the revenues of the
1462	corporation are revenues that are necessary to meet the
1463	requirements set forth in documents authorizing the issuance of
1464	bonds under this subsection.
1465	f.  No part of the income of the corporation may inure to
1466	the benefit of any private person.
1467	3.  With respect to a deficit in an account:
1468	a.  After accounting for the Citizens policyholder
1469	surcharge imposed under sub-subparagraph h. i., if when the
1470	remaining projected deficit incurred in a particular calendar
1471	year:
1472	(I)  Is not greater than 6 percent of the aggregate
1473	statewide direct written premium for the subject lines of
1474	business for the prior calendar year, the entire deficit shall
1475	be recovered through regular assessments of assessable insurers
1476	under paragraph (q) and assessable insureds.
1477	(II)b.  After accounting for the Citizens policyholder
1478	surcharge imposed under sub-subparagraph i., when the remaining
1479	projected deficit incurred in a particular calendar year Exceeds
1480	6 percent of the aggregate statewide direct written premium for
1481	the subject lines of business for the prior calendar year, the
1482	corporation shall levy regular assessments on assessable
1483	insurers under paragraph (q) and on assessable insureds in an
1484	amount equal to the greater of 6 percent of the deficit or 6
1485	percent of the aggregate statewide direct written premium for
1486	the subject lines of business for the prior calendar year. Any
1487	remaining deficit shall be recovered through emergency
1488	assessments under sub-subparagraph c. d.
1489	b.c.  Each assessable insurer's share of the amount being
1490	assessed under sub-subparagraph a. must or sub-subparagraph b.
1491	shall be in the proportion that the assessable insurer's direct
1492	written premium for the subject lines of business for the year
1493	preceding the assessment bears to the aggregate statewide direct
1494	written premium for the subject lines of business for that year.
1495	The applicable assessment percentage applicable to each
1496	assessable insured is the ratio of the amount being assessed
1497	under sub-subparagraph a. or sub-subparagraph b. to the
1498	aggregate statewide direct written premium for the subject lines
1499	of business for the prior year. Assessments levied by the
1500	corporation on assessable insurers under sub-subparagraph a.
1501	must sub-subparagraphs a. and b. shall be paid as required by
1502	the corporation's plan of operation and paragraph (q).
1503	Assessments levied by the corporation on assessable insureds
1504	under sub-subparagraph a. sub-subparagraphs a. and b. shall be
1505	collected by the surplus lines agent at the time the surplus
1506	lines agent collects the surplus lines tax required by s.
1507	626.932, and shall be paid to the Florida Surplus Lines Service
1508	Office at the time the surplus lines agent pays the surplus
1509	lines tax to that the Florida Surplus Lines Service office. Upon
1510	receipt of regular assessments from surplus lines agents, the
1511	Florida Surplus Lines Service Office shall transfer the
1512	assessments directly to the corporation as determined by the
1513	corporation.
1514	c.d.  Upon a determination by the board of governors that a
1515	deficit in an account exceeds the amount that will be recovered
1516	through regular assessments under sub-subparagraph a. or sub-
1517	subparagraph b., plus the amount that is expected to be
1518	recovered through surcharges under sub-subparagraph h. i., as to
1519	the remaining projected deficit the board shall levy, after
1520	verification by the office, shall levy emergency assessments,
1521	for as many years as necessary to cover the deficits, to be
1522	collected by assessable insurers and the corporation and
1523	collected from assessable insureds upon issuance or renewal of
1524	policies for subject lines of business, excluding National Flood
1525	Insurance policies. The amount of the emergency assessment
1526	collected in a particular year must shall be a uniform
1527	percentage of that year's direct written premium for subject
1528	lines of business and all accounts of the corporation, excluding
1529	National Flood Insurance Program policy premiums, as annually
1530	determined by the board and verified by the office. The office
1531	shall verify the arithmetic calculations involved in the board's
1532	determination within 30 days after receipt of the information on
1533	which the determination was based. Notwithstanding any other
1534	provision of law, the corporation and each assessable insurer
1535	that writes subject lines of business shall collect emergency
1536	assessments from its policyholders without such obligation being
1537	affected by any credit, limitation, exemption, or deferment.
1538	Emergency assessments levied by the corporation on assessable
1539	insureds shall be collected by the surplus lines agent at the
1540	time the surplus lines agent collects the surplus lines tax
1541	required by s. 626.932 and shall be paid to the Florida Surplus
1542	Lines Service Office at the time the surplus lines agent pays
1543	the surplus lines tax to that the Florida Surplus Lines Service
1544	office. The emergency assessments so collected shall be
1545	transferred directly to the corporation on a periodic basis as
1546	determined by the corporation and shall be held by the
1547	corporation solely in the applicable account. The aggregate
1548	amount of emergency assessments levied for an account under this
1549	sub-subparagraph in any calendar year may, at the discretion of
1550	the board of governors, be less than but may not exceed the
1551	greater of 10 percent of the amount needed to cover the deficit,
1552	plus interest, fees, commissions, required reserves, and other
1553	costs associated with financing of the original deficit, or 10
1554	percent of the aggregate statewide direct written premium for
1555	subject lines of business and for all accounts of the
1556	corporation for the prior year, plus interest, fees,
1557	commissions, required reserves, and other costs associated with
1558	financing the deficit.
1559	d.e.  The corporation may pledge the proceeds of
1560	assessments, projected recoveries from the Florida Hurricane
1561	Catastrophe Fund, other insurance and reinsurance recoverables,
1562	policyholder surcharges and other surcharges, and other funds
1563	available to the corporation as the source of revenue for and to
1564	secure bonds issued under paragraph (q), bonds or other
1565	indebtedness issued under subparagraph (c)3., or lines of credit
1566	or other financing mechanisms issued or created under this
1567	subsection, or to retire any other debt incurred as a result of
1568	deficits or events giving rise to deficits, or in any other way
1569	that the board determines will efficiently recover such
1570	deficits. The purpose of the lines of credit or other financing
1571	mechanisms is to provide additional resources to assist the
1572	corporation in covering claims and expenses attributable to a
1573	catastrophe. As used in this subsection, the term "assessments"
1574	includes regular assessments under sub-subparagraph a., sub-
1575	subparagraph b., or subparagraph (q)1. and emergency assessments
1576	under sub-subparagraph d. Emergency assessments collected under
1577	sub-subparagraph d. are not part of an insurer's rates, are not
1578	premium, and are not subject to premium tax, fees, or
1579	commissions; however, failure to pay the emergency assessment
1580	shall be treated as failure to pay premium. The emergency
1581	assessments under sub-subparagraph c. d. shall continue as long
1582	as any bonds issued or other indebtedness incurred with respect
1583	to a deficit for which the assessment was imposed remain
1584	outstanding, unless adequate provision has been made for the
1585	payment of such bonds or other indebtedness pursuant to the
1586	documents governing such bonds or other indebtedness.
1587	e.f.  As used in this subsection for purposes of any
1588	deficit incurred on or after January 25, 2007, the term "subject
1589	lines of business" means insurance written by assessable
1590	insurers or procured by assessable insureds for all property and
1591	casualty lines of business in this state, but not including
1592	workers' compensation or medical malpractice. As used in this
1593	the sub-subparagraph, the term "property and casualty lines of
1594	business" includes all lines of business identified on Form 2,
1595	Exhibit of Premiums and Losses, in the annual statement required
1596	of authorized insurers under by s. 624.424 and any rule adopted
1597	under this section, except for those lines identified as
1598	accident and health insurance and except for policies written
1599	under the National Flood Insurance Program or the Federal Crop
1600	Insurance Program. For purposes of this sub-subparagraph, the
1601	term "workers' compensation" includes both workers' compensation
1602	insurance and excess workers' compensation insurance.
1603	f.g.  The Florida Surplus Lines Service Office shall
1604	determine annually the aggregate statewide written premium in
1605	subject lines of business procured by assessable insureds and
1606	shall report that information to the corporation in a form and
1607	at a time the corporation specifies to ensure that the
1608	corporation can meet the requirements of this subsection and the
1609	corporation's financing obligations.
1610	g.h.  The Florida Surplus Lines Service Office shall verify
1611	the proper application by surplus lines agents of assessment
1612	percentages for regular assessments and emergency assessments
1613	levied under this subparagraph on assessable insureds and shall
1614	assist the corporation in ensuring the accurate, timely
1615	collection and payment of assessments by surplus lines agents as
1616	required by the corporation.
1617	h.i.  If a deficit is incurred in any account in 2008 or
1618	thereafter, the board of governors shall levy a Citizens
1619	policyholder surcharge against all policyholders of the
1620	corporation. for a 12-month period, which
1621	(I)  The surcharge shall be levied collected at the time of
1622	issuance or renewal of a policy, as a uniform percentage of the
1623	premium for the policy of up to 15 percent of such premium,
1624	which funds shall be used to offset the deficit.
1625	(II)  The surcharge is payable upon cancellation or
1626	termination of the policy, upon renewal of the policy, or upon
1627	issuance of a new policy by the corporation within the first 12
1628	months after the date of the levy or the period of time
1629	necessary to fully collect the surcharge amount.
1630	(III)  The corporation may not levy any regular assessments
1631	under paragraph (q) pursuant to sub-subparagraph a. or sub-
1632	subparagraph b. with respect to a particular year's deficit
1633	until the corporation has first levied the full amount of the
1634	surcharge authorized by this sub-subparagraph.
1635	(IV)  The surcharge is Citizens policyholder surcharges
1636	under this sub-subparagraph are not considered premium and is
1637	are not subject to commissions, fees, or premium taxes. However,
1638	failure to pay the surcharge such surcharges shall be treated as
1639	failure to pay premium.
1640	i.j.  If the amount of any assessments or surcharges
1641	collected from corporation policyholders, assessable insurers or
1642	their policyholders, or assessable insureds exceeds the amount
1643	of the deficits, such excess amounts shall be remitted to and
1644	retained by the corporation in a reserve to be used by the
1645	corporation, as determined by the board of governors and
1646	approved by the office, to pay claims or reduce any past,
1647	present, or future plan-year deficits or to reduce outstanding
1648	debt.
1649	(c)  The corporation's plan of operation of the
1650	corporation:
1651	1.  Must provide for adoption of residential property and
1652	casualty insurance policy forms and commercial residential and
1653	nonresidential property insurance forms, which forms must be
1654	approved by the office before prior to use. The corporation
1655	shall adopt the following policy forms:
1656	a.  Standard personal lines policy forms that are
1657	comprehensive multiperil policies providing full coverage of a
1658	residential property equivalent to the coverage provided in the
1659	private insurance market under an HO-3, HO-4, or HO-6 policy.
1660	b.  Basic personal lines policy forms that are policies
1661	similar to an HO-8 policy or a dwelling fire policy that provide
1662	coverage meeting the requirements of the secondary mortgage
1663	market, but which coverage is more limited than the coverage
1664	under a standard policy.
1665	c.  Commercial lines residential and nonresidential policy
1666	forms that are generally similar to the basic perils of full
1667	coverage obtainable for commercial residential structures and
1668	commercial nonresidential structures in the admitted voluntary
1669	market.
1670	d.  Personal lines and commercial lines residential
1671	property insurance forms that cover the peril of wind only. The
1672	forms are applicable only to residential properties located in
1673	areas eligible for coverage under the coastal high-risk account
1674	referred to in sub-subparagraph (b)2.a.
1675	e.  Commercial lines nonresidential property insurance
1676	forms that cover the peril of wind only. The forms are
1677	applicable only to nonresidential properties located in areas
1678	eligible for coverage under the coastal high-risk account
1679	referred to in sub-subparagraph (b)2.a.
1680	f.  The corporation may adopt variations of the policy
1681	forms listed in sub-subparagraphs a.-e. which that contain more
1682	restrictive coverage.
1683	2.a.  Must provide that the corporation adopt a program in
1684	which the corporation and authorized insurers enter into quota
1685	share primary insurance agreements for hurricane coverage, as
1686	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1687	property insurance forms for eligible risks which cover the
1688	peril of wind only.
1689	a.  As used in this subsection, the term:
1690	(I)  "Quota share primary insurance" means an arrangement
1691	in which the primary hurricane coverage of an eligible risk is
1692	provided in specified percentages by the corporation and an
1693	authorized insurer. The corporation and authorized insurer are
1694	each solely responsible for a specified percentage of hurricane
1695	coverage of an eligible risk as set forth in a quota share
1696	primary insurance agreement between the corporation and an
1697	authorized insurer and the insurance contract. The
1698	responsibility of the corporation or authorized insurer to pay
1699	its specified percentage of hurricane losses of an eligible
1700	risk, as set forth in the quota share primary insurance
1701	agreement, may not be altered by the inability of the other
1702	party to the agreement to pay its specified percentage of
1703	hurricane losses. Eligible risks that are provided hurricane
1704	coverage through a quota share primary insurance arrangement
1705	must be provided policy forms that set forth the obligations of
1706	the corporation and authorized insurer under the arrangement,
1707	clearly specify the percentages of quota share primary insurance
1708	provided by the corporation and authorized insurer, and
1709	conspicuously and clearly state that neither the authorized
1710	insurer and nor the corporation may not be held responsible
1711	beyond their its specified percentage of coverage of hurricane
1712	losses.
1713	(II)  "Eligible risks" means personal lines residential and
1714	commercial lines residential risks that meet the underwriting
1715	criteria of the corporation and are located in areas that were
1716	eligible for coverage by the Florida Windstorm Underwriting
1717	Association on January 1, 2002.
1718	b.  The corporation may enter into quota share primary
1719	insurance agreements with authorized insurers at corporation
1720	coverage levels of 90 percent and 50 percent.
1721	c.  If the corporation determines that additional coverage
1722	levels are necessary to maximize participation in quota share
1723	primary insurance agreements by authorized insurers, the
1724	corporation may establish additional coverage levels. However,
1725	the corporation's quota share primary insurance coverage level
1726	may not exceed 90 percent.
1727	d.  Any quota share primary insurance agreement entered
1728	into between an authorized insurer and the corporation must
1729	provide for a uniform specified percentage of coverage of
1730	hurricane losses, by county or territory as set forth by the
1731	corporation board, for all eligible risks of the authorized
1732	insurer covered under the quota share primary insurance
1733	agreement.
1734	e.  Any quota share primary insurance agreement entered
1735	into between an authorized insurer and the corporation is
1736	subject to review and approval by the office. However, such
1737	agreement shall be authorized only as to insurance contracts
1738	entered into between an authorized insurer and an insured who is
1739	already insured by the corporation for wind coverage.
1740	f.  For all eligible risks covered under quota share
1741	primary insurance agreements, the exposure and coverage levels
1742	for both the corporation and authorized insurers shall be
1743	reported by the corporation to the Florida Hurricane Catastrophe
1744	Fund. For all policies of eligible risks covered under such
1745	quota share primary insurance agreements, the corporation and
1746	the authorized insurer must shall maintain complete and accurate
1747	records for the purpose of exposure and loss reimbursement
1748	audits as required by Florida Hurricane Catastrophe fund rules.
1749	The corporation and the authorized insurer shall each maintain
1750	duplicate copies of policy declaration pages and supporting
1751	claims documents.
1752	g.  The corporation board shall establish in its plan of
1753	operation standards for quota share agreements which ensure that
1754	there is no discriminatory application among insurers as to the
1755	terms of the quota share agreements, pricing of the quota share
1756	agreements, incentive provisions if any, and consideration paid
1757	for servicing policies or adjusting claims.
1758	h.  The quota share primary insurance agreement between the
1759	corporation and an authorized insurer must set forth the
1760	specific terms under which coverage is provided, including, but
1761	not limited to, the sale and servicing of policies issued under
1762	the agreement by the insurance agent of the authorized insurer
1763	producing the business, the reporting of information concerning
1764	eligible risks, the payment of premium to the corporation, and
1765	arrangements for the adjustment and payment of hurricane claims
1766	incurred on eligible risks by the claims adjuster and personnel
1767	of the authorized insurer. Entering into a quota sharing
1768	insurance agreement between the corporation and an authorized
1769	insurer is shall be voluntary and at the discretion of the
1770	authorized insurer.
1771	3.a.  May provide that the corporation may employ or
1772	otherwise contract with individuals or other entities to provide
1773	administrative or professional services that may be appropriate
1774	to effectuate the plan. The corporation may shall have the power
1775	to borrow funds, by issuing bonds or by incurring other
1776	indebtedness, and shall have other powers reasonably necessary
1777	to effectuate the requirements of this subsection, including,
1778	without limitation, the power to issue bonds and incur other
1779	indebtedness in order to refinance outstanding bonds or other
1780	indebtedness. The corporation may, but is not required to, seek
1781	judicial validation of its bonds or other indebtedness under
1782	chapter 75. The corporation may issue bonds or incur other
1783	indebtedness, or have bonds issued on its behalf by a unit of
1784	local government pursuant to subparagraph (q)2., in the absence
1785	of a hurricane or other weather-related event, upon a
1786	determination by the corporation, subject to approval by the
1787	office, that such action would enable it to efficiently meet the
1788	financial obligations of the corporation and that such
1789	financings are reasonably necessary to effectuate the
1790	requirements of this subsection. The corporation may is
1791	authorized to take all actions needed to facilitate tax-free
1792	status for any such bonds or indebtedness, including formation
1793	of trusts or other affiliated entities. The corporation may
1794	shall have the authority to pledge assessments, projected
1795	recoveries from the Florida Hurricane Catastrophe Fund, other
1796	reinsurance recoverables, market equalization and other
1797	surcharges, and other funds available to the corporation as
1798	security for bonds or other indebtedness. In recognition of s.
1799	10, Art. I of the State Constitution, prohibiting the impairment
1800	of obligations of contracts, it is the intent of the Legislature
1801	that no action be taken whose purpose is to impair any bond
1802	indenture or financing agreement or any revenue source committed
1803	by contract to such bond or other indebtedness.
1804	b.  To ensure that the corporation is operating in an
1805	efficient and economic manner while providing quality service to
1806	policyholders, applicants, and agents, the board shall
1807	commission an independent third-party consultant having
1808	expertise in insurance company management or insurance company
1809	management consulting to prepare a report and make
1810	recommendations on the relative costs and benefits of
1811	outsourcing various policy issuance and service functions to
1812	private servicing carriers or entities performing similar
1813	functions in the private market for a fee, rather than
1814	performing such functions in house. In making such
1815	recommendations, the consultant shall consider how other
1816	residual markets, both in this state and around the country,
1817	outsource appropriate functions or use servicing carriers to
1818	better match expenses with revenues that fluctuate based on a
1819	widely varying policy count. The report must be completed by
1820	July 1, 2012. Upon receiving the report, the board shall develop
1821	a plan to implement the report and submit the plan for review,
1822	modification, and approval to the Financial Services Commission.
1823	Upon the commission's approval of the plan, the board shall
1824	begin implementing the plan by January 1, 2013.
1825	4.a.  Must require that the corporation operate subject to
1826	the supervision and approval of a board of governors consisting
1827	of eight individuals who are residents of this state, from
1828	different geographical areas of this state.
1829	a.  The Governor, the Chief Financial Officer, the
1830	President of the Senate, and the Speaker of the House of
1831	Representatives shall each appoint two members of the board. At
1832	least one of the two members appointed by each appointing
1833	officer must have demonstrated expertise in insurance, and is
1834	deemed to be within the scope of the exemption provided in s.
1835	112.313(7)(b). The Chief Financial Officer shall designate one
1836	of the appointees as chair. All board members serve at the
1837	pleasure of the appointing officer. All members of the board of
1838	governors are subject to removal at will by the officers who
1839	appointed them. All board members, including the chair, must be
1840	appointed to serve for 3-year terms beginning annually on a date
1841	designated by the plan. However, for the first term beginning on
1842	or after July 1, 2009, each appointing officer shall appoint one
1843	member of the board for a 2-year term and one member for a 3-
1844	year term. A Any board vacancy shall be filled for the unexpired
1845	term by the appointing officer. The Chief Financial Officer
1846	shall appoint a technical advisory group to provide information
1847	and advice to the board of governors in connection with the
1848	board's duties under this subsection. The executive director and
1849	senior managers of the corporation shall be engaged by the board
1850	and serve at the pleasure of the board. Any executive director
1851	appointed on or after July 1, 2006, is subject to confirmation
1852	by the Senate. The executive director is responsible for
1853	employing other staff as the corporation may require, subject to
1854	review and concurrence by the board.
1855	b.  The board shall create a Market Accountability Advisory
1856	Committee to assist the corporation in developing awareness of
1857	its rates and its customer and agent service levels in
1858	relationship to the voluntary market insurers writing similar
1859	coverage.
1860	(I)  The members of the advisory committee shall consist of
1861	the following 11 persons, one of whom must be elected chair by
1862	the members of the committee: four representatives, one
1863	appointed by the Florida Association of Insurance Agents, one by
1864	the Florida Association of Insurance and Financial Advisors, one
1865	by the Professional Insurance Agents of Florida, and one by the
1866	Latin American Association of Insurance Agencies; three
1867	representatives appointed by the insurers with the three highest
1868	voluntary market share of residential property insurance
1869	business in the state; one representative from the Office of
1870	Insurance Regulation; one consumer appointed by the board who is
1871	insured by the corporation at the time of appointment to the
1872	committee; one representative appointed by the Florida
1873	Association of Realtors; and one representative appointed by the
1874	Florida Bankers Association. All members shall be appointed to
1875	must serve for 3-year terms and may serve for consecutive terms.
1876	(II)  The committee shall report to the corporation at each
1877	board meeting on insurance market issues which may include rates
1878	and rate competition with the voluntary market; service,
1879	including policy issuance, claims processing, and general
1880	responsiveness to policyholders, applicants, and agents; and
1881	matters relating to depopulation.
1882	5.  Must provide a procedure for determining the
1883	eligibility of a risk for coverage, as follows:
1884	a.  Subject to the provisions of s. 627.3517, with respect
1885	to personal lines residential risks, if the risk is offered
1886	coverage from an authorized insurer at the insurer's approved
1887	rate under either a standard policy including wind coverage or,
1888	if consistent with the insurer's underwriting rules as filed
1889	with the office, a basic policy including wind coverage, for a
1890	new application to the corporation for coverage, the risk is not
1891	eligible for any policy issued by the corporation unless the
1892	premium for coverage from the authorized insurer is more than 15
1893	percent greater than the premium for comparable coverage from
1894	the corporation. If the risk is not able to obtain any such
1895	offer, the risk is eligible for either a standard policy
1896	including wind coverage or a basic policy including wind
1897	coverage issued by the corporation; however, if the risk could
1898	not be insured under a standard policy including wind coverage
1899	regardless of market conditions, the risk is shall be eligible
1900	for a basic policy including wind coverage unless rejected under
1901	subparagraph 8. However, with regard to a policyholder of the
1902	corporation or a policyholder removed from the corporation
1903	through an assumption agreement until the end of the assumption
1904	period, the policyholder remains eligible for coverage from the
1905	corporation regardless of any offer of coverage from an
1906	authorized insurer or surplus lines insurer. The corporation
1907	shall determine the type of policy to be provided on the basis
1908	of objective standards specified in the underwriting manual and
1909	based on generally accepted underwriting practices.
1910	(I)  If the risk accepts an offer of coverage through the
1911	market assistance plan or an offer of coverage through a
1912	mechanism established by the corporation before a policy is
1913	issued to the risk by the corporation or during the first 30
1914	days of coverage by the corporation, and the producing agent who
1915	submitted the application to the plan or to the corporation is
1916	not currently appointed by the insurer, the insurer shall:
1917	(A)  Pay to the producing agent of record of the policy,
1918	for the first year, an amount that is the greater of the
1919	insurer's usual and customary commission for the type of policy
1920	written or a fee equal to the usual and customary commission of
1921	the corporation; or
1922	(B)  Offer to allow the producing agent of record of the
1923	policy to continue servicing the policy for at least a period of
1924	not less than 1 year and offer to pay the agent the greater of
1925	the insurer's or the corporation's usual and customary
1926	commission for the type of policy written.
1927
1928	If the producing agent is unwilling or unable to accept
1929	appointment, the new insurer shall pay the agent in accordance
1930	with sub-sub-sub-subparagraph (A).
1931	(II)  If When the corporation enters into a contractual
1932	agreement for a take-out plan, the producing agent of record of
1933	the corporation policy is entitled to retain any unearned
1934	commission on the policy, and the insurer shall:
1935	(A)  Pay to the producing agent of record of the
1936	corporation policy, for the first year, an amount that is the
1937	greater of the insurer's usual and customary commission for the
1938	type of policy written or a fee equal to the usual and customary
1939	commission of the corporation; or
1940	(B)  Offer to allow the producing agent of record of the
1941	corporation policy to continue servicing the policy for at least
1942	a period of not less than 1 year and offer to pay the agent the
1943	greater of the insurer's or the corporation's usual and
1944	customary commission for the type of policy written.
1945
1946	If the producing agent is unwilling or unable to accept
1947	appointment, the new insurer shall pay the agent in accordance
1948	with sub-sub-sub-subparagraph (A).
1949	b.  With respect to commercial lines residential risks, for
1950	a new application to the corporation for coverage, if the risk
1951	is offered coverage under a policy including wind coverage from
1952	an authorized insurer at its approved rate, the risk is not
1953	eligible for a any policy issued by the corporation unless the
1954	premium for coverage from the authorized insurer is more than 15
1955	percent greater than the premium for comparable coverage from
1956	the corporation. If the risk is not able to obtain any such
1957	offer, the risk is eligible for a policy including wind coverage
1958	issued by the corporation. However, with regard to a
1959	policyholder of the corporation or a policyholder removed from
1960	the corporation through an assumption agreement until the end of
1961	the assumption period, the policyholder remains eligible for
1962	coverage from the corporation regardless of an any offer of
1963	coverage from an authorized insurer or surplus lines insurer.
1964	(I)  If the risk accepts an offer of coverage through the
1965	market assistance plan or an offer of coverage through a
1966	mechanism established by the corporation before a policy is
1967	issued to the risk by the corporation or during the first 30
1968	days of coverage by the corporation, and the producing agent who
1969	submitted the application to the plan or the corporation is not
1970	currently appointed by the insurer, the insurer shall:
1971	(A)  Pay to the producing agent of record of the policy,
1972	for the first year, an amount that is the greater of the
1973	insurer's usual and customary commission for the type of policy
1974	written or a fee equal to the usual and customary commission of
1975	the corporation; or
1976	(B)  Offer to allow the producing agent of record of the
1977	policy to continue servicing the policy for at least a period of
1978	not less than 1 year and offer to pay the agent the greater of
1979	the insurer's or the corporation's usual and customary
1980	commission for the type of policy written.
1981
1982	If the producing agent is unwilling or unable to accept
1983	appointment, the new insurer shall pay the agent in accordance
1984	with sub-sub-sub-subparagraph (A).
1985	(II)  If When the corporation enters into a contractual
1986	agreement for a take-out plan, the producing agent of record of
1987	the corporation policy is entitled to retain any unearned
1988	commission on the policy, and the insurer shall:
1989	(A)  Pay to the producing agent of record of the
1990	corporation policy, for the first year, an amount that is the
1991	greater of the insurer's usual and customary commission for the
1992	type of policy written or a fee equal to the usual and customary
1993	commission of the corporation; or
1994	(B)  Offer to allow the producing agent of record of the
1995	corporation policy to continue servicing the policy for at least
1996	a period of not less than 1 year and offer to pay the agent the
1997	greater of the insurer's or the corporation's usual and
1998	customary commission for the type of policy written.
1999
2000	If the producing agent is unwilling or unable to accept
2001	appointment, the new insurer shall pay the agent in accordance
2002	with sub-sub-sub-subparagraph (A).
2003	c.  For purposes of determining comparable coverage under
2004	sub-subparagraphs a. and b., the comparison must shall be based
2005	on those forms and coverages that are reasonably comparable. The
2006	corporation may rely on a determination of comparable coverage
2007	and premium made by the producing agent who submits the
2008	application to the corporation, made in the agent's capacity as
2009	the corporation's agent. A comparison may be made solely of the
2010	premium with respect to the main building or structure only on
2011	the following basis: the same coverage A or other building
2012	limits; the same percentage hurricane deductible that applies on
2013	an annual basis or that applies to each hurricane for commercial
2014	residential property; the same percentage of ordinance and law
2015	coverage, if the same limit is offered by both the corporation
2016	and the authorized insurer; the same mitigation credits, to the
2017	extent the same types of credits are offered both by the
2018	corporation and the authorized insurer; the same method for loss
2019	payment, such as replacement cost or actual cash value, if the
2020	same method is offered both by the corporation and the
2021	authorized insurer in accordance with underwriting rules; and
2022	any other form or coverage that is reasonably comparable as
2023	determined by the board. If an application is submitted to the
2024	corporation for wind-only coverage in the coastal high-risk
2025	account, the premium for the corporation's wind-only policy plus
2026	the premium for the ex-wind policy that is offered by an
2027	authorized insurer to the applicant must shall be compared to
2028	the premium for multiperil coverage offered by an authorized
2029	insurer, subject to the standards for comparison specified in
2030	this subparagraph. If the corporation or the applicant requests
2031	from the authorized insurer a breakdown of the premium of the
2032	offer by types of coverage so that a comparison may be made by
2033	the corporation or its agent and the authorized insurer refuses
2034	or is unable to provide such information, the corporation may
2035	treat the offer as not being an offer of coverage from an
2036	authorized insurer at the insurer's approved rate.
2037	6.  Must include rules for classifications of risks and
2038	rates therefor.
2039	7.  Must provide that if premium and investment income for
2040	an account attributable to a particular calendar year are in
2041	excess of projected losses and expenses for the account
2042	attributable to that year, such excess shall be held in surplus
2043	in the account. Such surplus must shall be available to defray
2044	deficits in that account as to future years and shall be used
2045	for that purpose before prior to assessing assessable insurers
2046	and assessable insureds as to any calendar year.
2047	8.  Must provide objective criteria and procedures to be
2048	uniformly applied to for all applicants in determining whether
2049	an individual risk is so hazardous as to be uninsurable. In
2050	making this determination and in establishing the criteria and
2051	procedures, the following must shall be considered:
2052	a.  Whether the likelihood of a loss for the individual
2053	risk is substantially higher than for other risks of the same
2054	class; and
2055	b.  Whether the uncertainty associated with the individual
2056	risk is such that an appropriate premium cannot be determined.
2057
2058	The acceptance or rejection of a risk by the corporation shall
2059	be construed as the private placement of insurance, and the
2060	provisions of chapter 120 do shall not apply.
2061	9.  Must provide that the corporation shall make its best
2062	efforts to procure catastrophe reinsurance at reasonable rates,
2063	to cover its projected 100-year probable maximum loss as
2064	determined by the board of governors.
2065	10.  The policies issued by the corporation must provide
2066	that, if the corporation or the market assistance plan obtains
2067	an offer from an authorized insurer to cover the risk at its
2068	approved rates, the risk is no longer eligible for renewal
2069	through the corporation, except as otherwise provided in this
2070	subsection.
2071	11.  Corporation policies and applications must include a
2072	notice that the corporation policy could, under this section, be
2073	replaced with a policy issued by an authorized insurer which
2074	that does not provide coverage identical to the coverage
2075	provided by the corporation. The notice must shall also specify
2076	that acceptance of corporation coverage creates a conclusive
2077	presumption that the applicant or policyholder is aware of this
2078	potential.
2079	12.  May establish, subject to approval by the office,
2080	different eligibility requirements and operational procedures
2081	for any line or type of coverage for any specified county or
2082	area if the board determines that such changes to the
2083	eligibility requirements and operational procedures are
2084	justified due to the voluntary market being sufficiently stable
2085	and competitive in such area or for such line or type of
2086	coverage and that consumers who, in good faith, are unable to
2087	obtain insurance through the voluntary market through ordinary
2088	methods would continue to have access to coverage from the
2089	corporation. If When coverage is sought in connection with a
2090	real property transfer, the such requirements and procedures may
2091	shall not provide for an effective date of coverage later than
2092	the date of the closing of the transfer as established by the
2093	transferor, the transferee, and, if applicable, the lender.
2094	13.  Must provide that, with respect to the coastal high-
2095	risk account, any assessable insurer with a surplus as to
2096	policyholders of $25 million or less writing 25 percent or more
2097	of its total countrywide property insurance premiums in this
2098	state may petition the office, within the first 90 days of each
2099	calendar year, to qualify as a limited apportionment company. A
2100	regular assessment levied by the corporation on a limited
2101	apportionment company for a deficit incurred by the corporation
2102	for the coastal high-risk account in 2006 or thereafter may be
2103	paid to the corporation on a monthly basis as the assessments
2104	are collected by the limited apportionment company from its
2105	insureds pursuant to s. 627.3512, but the regular assessment
2106	must be paid in full within 12 months after being levied by the
2107	corporation. A limited apportionment company shall collect from
2108	its policyholders any emergency assessment imposed under sub-
2109	subparagraph (b)3.d. The plan must shall provide that, if the
2110	office determines that any regular assessment will result in an
2111	impairment of the surplus of a limited apportionment company,
2112	the office may direct that all or part of such assessment be
2113	deferred as provided in subparagraph (q)4. However, there shall
2114	be no limitation or deferment of an emergency assessment to be
2115	collected from policyholders under sub-subparagraph (b)3.d. may
2116	not be limited or deferred.
2117	14.  Must provide that the corporation appoint as its
2118	licensed agents only those agents who also hold an appointment
2119	as defined in s. 626.015(3) with an insurer who at the time of
2120	the agent's initial appointment by the corporation is authorized
2121	to write and is actually writing personal lines residential
2122	property coverage, commercial residential property coverage, or
2123	commercial nonresidential property coverage within the state.
2124	15.  Must provide, by July 1, 2007, a premium payment plan
2125	option to its policyholders which, allows at a minimum, allows
2126	for quarterly and semiannual payment of premiums. A monthly
2127	payment plan may, but is not required to, be offered.
2128	16.  Must limit coverage on mobile homes or manufactured
2129	homes built before prior to 1994 to actual cash value of the
2130	dwelling rather than replacement costs of the dwelling.
2131	17.  May provide such limits of coverage as the board
2132	determines, consistent with the requirements of this subsection.
2133	18.  May require commercial property to meet specified
2134	hurricane mitigation construction features as a condition of
2135	eligibility for coverage.
2136	19.  Must provide that new or renewal policies issued by
2137	the corporation on or after January 1, 2012, which cover
2138	sinkhole loss do not include coverage for any loss to
2139	appurtenant structures, driveways, sidewalks, decks, or patios
2140	that are directly or indirectly caused by sinkhole activity. The
2141	corporation shall exclude such coverage using a notice of
2142	coverage change, which may be included with the policy renewal,
2143	and not by issuance of a notice of nonrenewal of the excluded
2144	coverage upon renewal of the current policy.
2145	20.  As of January 1, 2012, must require that the agent
2146	obtain from an applicant for coverage from the corporation an
2147	acknowledgement signed by the applicant, which includes, at a
2148	minimum, the following statement:
2149
2150	ACKNOWLEDGEMENT OF POTENTIAL SURCHARGE
2151	AND ASSESSMENT LIABILITY:
2152
2153	1.  AS A POLICYHOLDER OF CITIZENS PROPERTY
2154	INSURANCE CORPORATION, I UNDERSTAND THAT IF THE
2155	CORPORATION SUSTAINS A DEFICIT AS A RESULT OF
2156	HURRICANE LOSSES OR FOR ANY OTHER REASON, MY POLICY
2157	COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND
2158	PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF
2159	THE POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH
2160	AS 45 PERCENT OF MY PREMIUM, OR A DIFFERENT AMOUNT AS
2161	IMPOSED BY THE FLORIDA LEGISLATURE.
2162	2.  I ALSO UNDERSTAND THAT I MAY BE SUBJECT TO
2163	EMERGENCY ASSESSMENTS TO THE SAME EXTENT AS
2164	POLICYHOLDERS OF OTHER INSURANCE COMPANIES, OR A
2165	DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA
2166	LEGISLATURE.
2167	3.  I ALSO UNDERSTAND THAT CITIZENS PROPERTY
2168	INSURANCE CORPORATION IS NOT SUPPORTED BY THE FULL
2169	FAITH AND CREDIT OF THE STATE OF FLORIDA.
2170
2171	a.  The corporation shall maintain, in electronic format or
2172	otherwise, a copy of the applicant's signed acknowledgement and
2173	provide a copy of the statement to the policyholder as part of
2174	the first renewal after the effective date of this subparagraph.
2175	b.  The signed acknowledgement form creates a conclusive
2176	presumption that the policyholder understood and accepted his or
2177	her potential surcharge and assessment liability as a
2178	policyholder of the corporation.
2179	(d)1.  All prospective employees for senior management
2180	positions, as defined by the plan of operation, are subject to
2181	background checks as a prerequisite for employment. The office
2182	shall conduct the background checks on such prospective
2183	employees pursuant to ss. 624.34, 624.404(3), and 628.261.
2184	2.  On or before July 1 of each year, employees of the
2185	corporation must are required to sign and submit a statement
2186	attesting that they do not have a conflict of interest, as
2187	defined in part III of chapter 112. As a condition of
2188	employment, all prospective employees must are required to sign
2189	and submit to the corporation a conflict-of-interest statement.
2190	3.  Senior managers and members of the board of governors
2191	are subject to the provisions of part III of chapter 112,
2192	including, but not limited to, the code of ethics and public
2193	disclosure and reporting of financial interests, pursuant to s.
2194	112.3145. Notwithstanding s. 112.3143(2), a board member may not
2195	vote on any measure that would inure to his or her special
2196	private gain or loss; that he or she knows would inure to the
2197	special private gain or loss of any principal by whom he or she
2198	is retained or to the parent organization or subsidiary of a
2199	corporate principal by which he or she is retained, other than
2200	an agency as defined in s. 112.312; or that he or she knows
2201	would inure to the special private gain or loss of a relative or
2202	business associate of the public officer. Before the vote is
2203	taken, such member shall publicly state to the assembly the
2204	nature of his or her interest in the matter from which he or she
2205	is abstaining from voting and, within 15 days after the vote
2206	occurs, disclose the nature of his or her interest as a public
2207	record in a memorandum filed with the person responsible for
2208	recording the minutes of the meeting, who shall incorporate the
2209	memorandum in the minutes. Senior managers and board members are
2210	also required to file such disclosures with the Commission on
2211	Ethics and the Office of Insurance Regulation. The executive
2212	director of the corporation or his or her designee shall notify
2213	each existing and newly appointed and existing appointed member
2214	of the board of governors and senior managers of their duty to
2215	comply with the reporting requirements of part III of chapter
2216	112. At least quarterly, the executive director or his or her
2217	designee shall submit to the Commission on Ethics a list of
2218	names of the senior managers and members of the board of
2219	governors who are subject to the public disclosure requirements
2220	under s. 112.3145.
2221	4.  Notwithstanding s. 112.3148 or s. 112.3149, or any
2222	other provision of law, an employee or board member may not
2223	knowingly accept, directly or indirectly, any gift or
2224	expenditure from a person or entity, or an employee or
2225	representative of such person or entity, which that has a
2226	contractual relationship with the corporation or who is under
2227	consideration for a contract. An employee or board member who
2228	fails to comply with subparagraph 3. or this subparagraph is
2229	subject to penalties provided under ss. 112.317 and 112.3173.
2230	5.  Any senior manager of the corporation who is employed
2231	on or after January 1, 2007, regardless of the date of hire, who
2232	subsequently retires or terminates employment is prohibited from
2233	representing another person or entity before the corporation for
2234	2 years after retirement or termination of employment from the
2235	corporation.
2236	6.  Any senior manager of the corporation who is employed
2237	on or after January 1, 2007, regardless of the date of hire, who
2238	subsequently retires or terminates employment is prohibited from
2239	having any employment or contractual relationship for 2 years
2240	with an insurer that has entered into a take-out bonus agreement
2241	with the corporation.
2242	(n)1.  Rates for coverage provided by the corporation must
2243	shall be actuarially sound and subject to the requirements of s.
2244	627.062, except as otherwise provided in this paragraph. The
2245	corporation shall file its recommended rates with the office at
2246	least annually. The corporation shall provide any additional
2247	information regarding the rates which the office requires. The
2248	office shall consider the recommendations of the board and issue
2249	a final order establishing the rates for the corporation within
2250	45 days after the recommended rates are filed. The corporation
2251	may not pursue an administrative challenge or judicial review of
2252	the final order of the office.
2253	2.  In addition to the rates otherwise determined pursuant
2254	to this paragraph, the corporation shall impose and collect an
2255	amount equal to the premium tax provided for in s. 624.509 to
2256	augment the financial resources of the corporation.
2257	3.  After the public hurricane loss-projection model under
2258	s. 627.06281 has been found to be accurate and reliable by the
2259	Florida Commission on Hurricane Loss Projection Methodology, the
2260	that model shall serve as the minimum benchmark for determining
2261	the windstorm portion of the corporation's rates. This
2262	subparagraph does not require or allow the corporation to adopt
2263	rates lower than the rates otherwise required or allowed by this
2264	paragraph.
2265	4.  The rate filings for the corporation which were
2266	approved by the office and which took effect January 1, 2007,
2267	are rescinded, except for those rates that were lowered. As soon
2268	as possible, the corporation shall begin using the lower rates
2269	that were in effect on December 31, 2006, and shall provide
2270	refunds to policyholders who have paid higher rates as a result
2271	of that rate filing. The rates in effect on December 31, 2006,
2272	shall remain in effect for the 2007 and 2008 calendar years
2273	except for any rate change that results in a lower rate. The
2274	next rate change that may increase rates shall take effect
2275	pursuant to a new rate filing recommended by the corporation and
2276	established by the office, subject to the requirements of this
2277	paragraph.
2278	5.  Beginning on July 15, 2009, and annually each year
2279	thereafter, the corporation must make a recommended actuarially
2280	sound rate filing for each personal and commercial line of
2281	business it writes, to be effective no earlier than January 1,
2282	2010.
2283	6.  Beginning on or after January 1, 2010, and
2284	notwithstanding the board's recommended rates and the office's
2285	final order regarding the corporation's filed rates under
2286	subparagraph 1., the corporation shall annually implement a rate
2287	increase each year which, except for sinkhole coverage, does not
2288	exceed 10 percent for any single policy issued by the
2289	corporation, excluding coverage changes and surcharges.
2290	7.  The corporation may also implement an increase to
2291	reflect the effect on the corporation of the cash buildup factor
2292	pursuant to s. 215.555(5)(b).
2293	8.  The corporation's implementation of rates as prescribed
2294	in subparagraph 6. shall cease for any line of business written
2295	by the corporation upon the corporation's implementation of
2296	actuarially sound rates. Thereafter, the corporation shall
2297	annually make a recommended actuarially sound rate filing for
2298	each commercial and personal line of business the corporation
2299	writes.
2300	(v)1.  Effective July 1, 2002, policies of the Residential
2301	Property and Casualty Joint Underwriting Association shall
2302	become policies of the corporation. All obligations, rights,
2303	assets and liabilities of the Residential Property and Casualty
2304	Joint Underwriting association, including bonds, note and debt
2305	obligations, and the financing documents pertaining to them
2306	become those of the corporation as of July 1, 2002. The
2307	corporation is not required to issue endorsements or
2308	certificates of assumption to insureds during the remaining term
2309	of in-force transferred policies.
2310	2.  Effective July 1, 2002, policies of the Florida
2311	Windstorm Underwriting Association are transferred to the
2312	corporation and shall become policies of the corporation. All
2313	obligations, rights, assets, and liabilities of the Florida
2314	Windstorm Underwriting association, including bonds, note and
2315	debt obligations, and the financing documents pertaining to them
2316	are transferred to and assumed by the corporation on July 1,
2317	2002. The corporation is not required to issue endorsements or
2318	certificates of assumption to insureds during the remaining term
2319	of in-force transferred policies.
2320	3.  The Florida Windstorm Underwriting Association and the
2321	Residential Property and Casualty Joint Underwriting Association
2322	shall take all actions necessary as may be proper to further
2323	evidence the transfers and shall provide the documents and
2324	instruments of further assurance as may reasonably be requested
2325	by the corporation for that purpose. The corporation shall
2326	execute assumptions and instruments as the trustees or other
2327	parties to the financing documents of the Florida Windstorm
2328	Underwriting Association or the Residential Property and
2329	Casualty Joint Underwriting Association may reasonably request
2330	to further evidence the transfers and assumptions, which
2331	transfers and assumptions, however, are effective on the date
2332	provided under this paragraph whether or not, and regardless of
2333	the date on which, the assumptions or instruments are executed
2334	by the corporation. Subject to the relevant financing documents
2335	pertaining to their outstanding bonds, notes, indebtedness, or
2336	other financing obligations, the moneys, investments,
2337	receivables, choses in action, and other intangibles of the
2338	Florida Windstorm Underwriting Association shall be credited to
2339	the coastal high-risk account of the corporation, and those of
2340	the personal lines residential coverage account and the
2341	commercial lines residential coverage account of the Residential
2342	Property and Casualty Joint Underwriting Association shall be
2343	credited to the personal lines account and the commercial lines
2344	account, respectively, of the corporation.
2345	4.  Effective July 1, 2002, a new applicant for property
2346	insurance coverage who would otherwise have been eligible for
2347	coverage in the Florida Windstorm Underwriting Association is
2348	eligible for coverage from the corporation as provided in this
2349	subsection.
2350	5.  The transfer of all policies, obligations, rights,
2351	assets, and liabilities from the Florida Windstorm Underwriting
2352	Association to the corporation and the renaming of the
2353	Residential Property and Casualty Joint Underwriting Association
2354	as the corporation does not shall in no way affect the coverage
2355	with respect to covered policies as defined in s. 215.555(2)(c)
2356	provided to these entities by the Florida Hurricane Catastrophe
2357	Fund. The coverage provided by the Florida Hurricane Catastrophe
2358	fund to the Florida Windstorm Underwriting Association based on
2359	its exposures as of June 30, 2002, and each June 30 thereafter
2360	shall be redesignated as coverage for the coastal high-risk
2361	account of the corporation. Notwithstanding any other provision
2362	of law, the coverage provided by the Florida Hurricane
2363	Catastrophe fund to the Residential Property and Casualty Joint
2364	Underwriting Association based on its exposures as of June 30,
2365	2002, and each June 30 thereafter shall be transferred to the
2366	personal lines account and the commercial lines account of the
2367	corporation. Notwithstanding any other provision of law, the
2368	coastal high-risk account shall be treated, for all Florida
2369	Hurricane Catastrophe Fund purposes, as if it were a separate
2370	participating insurer with its own exposures, reimbursement
2371	premium, and loss reimbursement. Likewise, the personal lines
2372	and commercial lines accounts shall be viewed together, for all
2373	Florida Hurricane Catastrophe fund purposes, as if the two
2374	accounts were one and represent a single, separate participating
2375	insurer with its own exposures, reimbursement premium, and loss
2376	reimbursement. The coverage provided by the Florida Hurricane
2377	Catastrophe fund to the corporation shall constitute and operate
2378	as a full transfer of coverage from the Florida Windstorm
2379	Underwriting Association and Residential Property and Casualty
2380	Joint Underwriting to the corporation.
2381	(y)  It is the intent of the Legislature that the
2382	amendments to this subsection enacted in 2002 should, over time,
2383	reduce the probable maximum windstorm losses in the residual
2384	markets and should reduce the potential assessments to be levied
2385	on property insurers and policyholders statewide. In furtherance
2386	of this intent:
2387	1.  the board shall, on or before February 1 of each year,
2388	provide a report to the President of the Senate and the Speaker
2389	of the House of Representatives showing the reduction or
2390	increase in the 100-year probable maximum loss attributable to
2391	wind-only coverages and the quota share program under this
2392	subsection combined, as compared to the benchmark 100-year
2393	probable maximum loss of the Florida Windstorm Underwriting
2394	Association. For purposes of this paragraph, the benchmark 100-
2395	year probable maximum loss of the Florida Windstorm Underwriting
2396	Association shall be the calculation dated February 2001 and
2397	based on November 30, 2000, exposures. In order to ensure
2398	comparability of data, the board shall use the same methods for
2399	calculating its probable maximum loss as were used to calculate
2400	the benchmark probable maximum loss.
2401	2.  Beginning December 1, 2010, if the report under
2402	subparagraph 1. for any year indicates that the 100-year
2403	probable maximum loss attributable to wind-only coverages and
2404	the quota share program combined does not reflect a reduction of
2405	at least 25 percent from the benchmark, the board shall reduce
2406	the boundaries of the high-risk area eligible for wind-only
2407	coverages under this subsection in a manner calculated to reduce
2408	such probable maximum loss to an amount at least 25 percent
2409	below the benchmark.
2410	3.  Beginning February 1, 2015, if the report under
2411	subparagraph 1. for any year indicates that the 100-year
2412	probable maximum loss attributable to wind-only coverages and
2413	the quota share program combined does not reflect a reduction of
2414	at least 50 percent from the benchmark, the boundaries of the
2415	high-risk area eligible for wind-only coverages under this
2416	subsection shall be reduced by the elimination of any area that
2417	is not seaward of a line 1,000 feet inland from the Intracoastal
2418	Waterway.
2419	Section 17.  Paragraph (a) of subsection (5) of section
2420	627.3511, Florida Statutes, is amended to read:
2421	627.3511  Depopulation of Citizens Property Insurance
2422	Corporation.-
2423	(5)  APPLICABILITY.-
2424	(a)  The take-out bonus provided by subsection (2) and the
2425	exemption from assessment provided by paragraph (3)(a) apply
2426	only if the corporation policy is replaced by either a standard
2427	policy including wind coverage or, if consistent with the
2428	insurer's underwriting rules as filed with the office, a basic
2429	policy including wind coverage; however, for with respect to
2430	risks located in areas where coverage through the coastal high-
2431	risk account of the corporation is available, the replacement
2432	policy need not provide wind coverage. The insurer must renew
2433	the replacement policy at approved rates on substantially
2434	similar terms for four additional 1-year terms, unless canceled
2435	or not renewed by the policyholder. If an insurer assumes the
2436	corporation's obligations for a policy, it must issue a
2437	replacement policy for a 1-year term upon expiration of the
2438	corporation policy and must renew the replacement policy at
2439	approved rates on substantially similar terms for four
2440	additional 1-year terms, unless canceled or not renewed by the
2441	policyholder. For each replacement policy canceled or nonrenewed
2442	by the insurer for any reason during the 5-year coverage period
2443	required by this paragraph, the insurer must remove from the
2444	corporation one additional policy covering a risk similar to the
2445	risk covered by the canceled or nonrenewed policy. In addition
2446	to these requirements, the corporation must place the bonus
2447	moneys in escrow for a period of 5 years; such moneys may be
2448	released from escrow only to pay claims. If the policy is
2449	canceled or nonrenewed before the end of the 5-year period, the
2450	amount of the take-out bonus must be prorated for the time
2451	period the policy was insured. A take-out bonus provided by
2452	subsection (2) or subsection (6) is shall not be considered
2453	premium income for purposes of taxes and assessments under the
2454	Florida Insurance Code and shall remain the property of the
2455	corporation, subject to the prior security interest of the
2456	insurer under the escrow agreement until it is released from
2457	escrow;, and after it is released from escrow it is shall be
2458	considered an asset of the insurer and credited to the insurer's
2459	capital and surplus.
2460	Section 18.  Paragraph (b) of subsection (2) of section
2461	627.4133, Florida Statutes, is amended to read:
2462	627.4133  Notice of cancellation, nonrenewal, or renewal
2463	premium.-
2464	(2)  With respect to any personal lines or commercial
2465	residential property insurance policy, including, but not
2466	limited to, any homeowner's, mobile home owner's, farmowner's,
2467	condominium association, condominium unit owner's, apartment
2468	building, or other policy covering a residential structure or
2469	its contents:
2470	(b)  The insurer shall give the named insured written
2471	notice of nonrenewal, cancellation, or termination at least 100
2472	days before prior to the effective date of the nonrenewal,
2473	cancellation, or termination. However, the insurer shall give at
2474	least 100 days' written notice, or written notice by June 1,
2475	whichever is earlier, for any nonrenewal, cancellation, or
2476	termination that would be effective between June 1 and November
2477	30. The notice must include the reason or reasons for the
2478	nonrenewal, cancellation, or termination, except that:
2479	1.  The insurer shall give the named insured written notice
2480	of nonrenewal, cancellation, or termination at least 120 180
2481	days prior to the effective date of the nonrenewal,
2482	cancellation, or termination for a named insured whose
2483	residential structure has been insured by that insurer or an
2484	affiliated insurer for at least a 5-year period immediately
2485	prior to the date of the written notice.
2486	2.  If When cancellation is for nonpayment of premium, at
2487	least 10 days' written notice of cancellation accompanied by the
2488	reason therefor must shall be given. As used in this
2489	subparagraph, the term "nonpayment of premium" means failure of
2490	the named insured to discharge when due any of her or his
2491	obligations in connection with the payment of premiums on a
2492	policy or any installment of such premium, whether the premium
2493	is payable directly to the insurer or its agent or indirectly
2494	under any premium finance plan or extension of credit, or
2495	failure to maintain membership in an organization if such
2496	membership is a condition precedent to insurance coverage. The
2497	term "Nonpayment of premium" also means the failure of a
2498	financial institution to honor an insurance applicant's check
2499	after delivery to a licensed agent for payment of a premium,
2500	even if the agent has previously delivered or transferred the
2501	premium to the insurer. If a dishonored check represents the
2502	initial premium payment, the contract and all contractual
2503	obligations are shall be void ab initio unless the nonpayment is
2504	cured within the earlier of 5 days after actual notice by
2505	certified mail is received by the applicant or 15 days after
2506	notice is sent to the applicant by certified mail or registered
2507	mail, and if the contract is void, any premium received by the
2508	insurer from a third party must shall be refunded to that party
2509	in full.
2510	3.  If When such cancellation or termination occurs during
2511	the first 90 days during which the insurance is in force and the
2512	insurance is canceled or terminated for reasons other than
2513	nonpayment of premium, at least 20 days' written notice of
2514	cancellation or termination accompanied by the reason therefor
2515	must shall be given unless except where there has been a
2516	material misstatement or misrepresentation or failure to comply
2517	with the underwriting requirements established by the insurer.
2518	4.  The requirement for providing written notice of
2519	nonrenewal by June 1 of any nonrenewal that would be effective
2520	between June 1 and November 30 does not apply to the following
2521	situations, but the insurer remains subject to the requirement
2522	to provide such notice at least 100 days before prior to the
2523	effective date of nonrenewal:
2524	a.  A policy that is nonrenewed due to a revision in the
2525	coverage for sinkhole losses and catastrophic ground cover
2526	collapse pursuant to s. 627.706, as amended by s. 30, chapter
2527	2007-1, Laws of Florida.
2528	b.  A policy that is nonrenewed by Citizens Property
2529	Insurance Corporation, pursuant to s. 627.351(6), for a policy
2530	that has been assumed by an authorized insurer offering
2531	replacement or renewal coverage to the policyholder is exempt
2532	from the notice requirements of paragraph (a) and this
2533	paragraph. In such cases, the corporation must give the named
2534	insured written notice of nonrenewal at least 45 days before the
2535	effective date of the nonrenewal.
2536
2537	After the policy has been in effect for 90 days, the policy may
2538	shall not be canceled by the insurer unless except when there
2539	has been a material misstatement, a nonpayment of premium, a
2540	failure to comply with underwriting requirements established by
2541	the insurer within 90 days after of the date of effectuation of
2542	coverage, or a substantial change in the risk covered by the
2543	policy or if when the cancellation is for all insureds under
2544	such policies for a given class of insureds. This paragraph does
2545	not apply to individually rated risks having a policy term of
2546	less than 90 days.
2547	5.  Notwithstanding any other provision of law, an insurer
2548	may cancel or nonrenew a property insurance policy after at
2549	least 45 days' notice if the office finds that the early
2550	cancellation of some or all of the insurer's policies is
2551	necessary to protect the best interests of the public or
2552	policyholders and the office approves the insurer's plan for
2553	early cancellation or nonrenewal of some or all of its policies.
2554	The office may base such finding upon the financial condition of
2555	the insurer, lack of adequate reinsurance coverage for hurricane
2556	risk, or other relevant factors. The office may condition its
2557	finding on the consent of the insurer to be placed under
2558	administrative supervision pursuant to s. 624.81 or to the
2559	appointment of a receiver under chapter 631.
2560	6.  A policy covering both a home and motor vehicle may be
2561	nonrenewed for any reason applicable to either the property or
2562	motor vehicle insurance after providing 90 days' notice.
2563	Section 19.  Section 627.43141, Florida Statutes, is
2564	created to read:
2565	627.43141  Notice of change in policy terms.-
2566	(1)  As used in this section, the term:
2567	(a)  "Change in policy terms" means the modification,
2568	addition, or deletion of any term, coverage, duty, or condition
2569	from the previous policy. The correction of typographical or
2570	scrivener's errors or the application of mandated legislative
2571	changes is not a change in policy terms.
2572	(b)  "Policy" means a written contract of property and
2573	casualty insurance or written agreement for such insurance, by
2574	whatever name called, and includes all clauses, riders,
2575	endorsements, and papers that are a part of such policy. The
2576	term does not include a binder as defined in s. 627.420 unless
2577	the duration of the binder period exceeds 60 days.
2578	(c)  "Renewal" means the issuance and delivery by an
2579	insurer of a policy superseding at the end of the policy period
2580	a policy previously issued and delivered by the same insurer or
2581	the issuance and delivery of a certificate or notice extending
2582	the term of a policy beyond its policy period or term. Any
2583	policy that has a policy period or term of less than 6 months or
2584	that does not have a fixed expiration date shall, for purposes
2585	of this section, be considered as written for successive policy
2586	periods or terms of 6 months.
2587	(2)  A renewal policy may contain a change in policy terms.
2588	If a renewal policy does contains such change, the insurer must
2589	give the named insured written notice of the change, which must
2590	be enclosed along with the written notice of renewal premium
2591	required by ss. 627.4133 and 627.728. Such notice shall be
2592	entitled "Notice of Change in Policy Terms."
2593	(3)  Although not required, proof of mailing or registered
2594	mailing through the United States Postal Service of the Notice
2595	of Change in Policy Terms to the named insured at the address
2596	shown in the policy is sufficient proof of notice.
2597	(4)  Receipt of the premium payment for the renewal policy
2598	by the insurer is deemed to be acceptance of the new policy
2599	terms by the named insured.
2600	(5)  If an insurer fails to provide the notice required in
2601	subsection (2), the original policy terms remain in effect until
2602	the next renewal and the proper service of the notice, or until
2603	the effective date of replacement coverage obtained by the named
2604	insured, whichever occurs first.
2605	(6)  The intent of this section is to:
2606	(a)  Allow an insurer to make a change in policy terms
2607	without nonrenewing those policyholders that the insurer wishes
2608	to continue insuring.
2609	(b)  Alleviate concern and confusion to the policyholder
2610	caused by the required policy nonrenewal for the limited issue
2611	if an insurer intends to renew the insurance policy, but the new
2612	policy contains a change in policy terms.
2613	(c)  Encourage policyholders to discuss their coverages
2614	with their insurance agents.
2615	Section 20.  Section 627.7011, Florida Statutes, is amended
2616	to read:
2617	627.7011  Homeowners' policies; offer of replacement cost
2618	coverage and law and ordinance coverage.-
2619	(1)  Prior to issuing a homeowner's insurance policy on or
2620	after October 1, 2005, or prior to the first renewal of a
2621	homeowner's insurance policy on or after October 1, 2005, the
2622	insurer must offer each of the following:
2623	(a)  A policy or endorsement providing that any loss that
2624	which is repaired or replaced will be adjusted on the basis of
2625	replacement costs to the dwelling not exceeding policy limits as
2626	to the dwelling, rather than actual cash value, but not
2627	including costs necessary to meet applicable laws and ordinances
2628	regulating the construction, use, or repair of any property or
2629	requiring the tearing down of any property, including the costs
2630	of removing debris.
2631	(b)  A policy or endorsement providing that, subject to
2632	other policy provisions, any loss that which is repaired or
2633	replaced at any location will be adjusted on the basis of
2634	replacement costs to the dwelling not exceeding policy limits as
2635	to the dwelling, rather than actual cash value, and also
2636	including costs necessary to meet applicable laws and ordinances
2637	regulating the construction, use, or repair of any property or
2638	requiring the tearing down of any property, including the costs
2639	of removing debris.; However, such additional costs necessary to
2640	meet applicable laws and ordinances may be limited to either 25
2641	percent or 50 percent of the dwelling limit, as selected by the
2642	policyholder, and such coverage applies shall apply only to
2643	repairs of the damaged portion of the structure unless the total
2644	damage to the structure exceeds 50 percent of the replacement
2645	cost of the structure.
2646
2647	An insurer is not required to make the offers required by this
2648	subsection with respect to the issuance or renewal of a
2649	homeowner's policy that contains the provisions specified in
2650	paragraph (b) for law and ordinance coverage limited to 25
2651	percent of the dwelling limit, except that the insurer must
2652	offer the law and ordinance coverage limited to 50 percent of
2653	the dwelling limit. This subsection does not prohibit the offer
2654	of a guaranteed replacement cost policy.
2655	(2)  Unless the insurer obtains the policyholder's written
2656	refusal of the policies or endorsements specified in subsection
2657	(1), any policy covering the dwelling is deemed to include the
2658	law and ordinance coverage limited to 25 percent of the dwelling
2659	limit. The rejection or selection of alternative coverage shall
2660	be made on a form approved by the office. The form must shall
2661	fully advise the applicant of the nature of the coverage being
2662	rejected. If this form is signed by a named insured, it is will
2663	be conclusively presumed that there was an informed, knowing
2664	rejection of the coverage or election of the alternative
2665	coverage on behalf of all insureds. Unless the policyholder
2666	requests in writing the coverage specified in this section, it
2667	need not be provided in or supplemental to any other policy that
2668	renews, insures, extends, changes, supersedes, or replaces an
2669	existing policy if when the policyholder has rejected the
2670	coverage specified in this section or has selected alternative
2671	coverage. The insurer must provide the such policyholder with
2672	notice of the availability of such coverage in a form approved
2673	by the office at least once every 3 years. The failure to
2674	provide such notice constitutes a violation of this code, but
2675	does not affect the coverage provided under the policy.
2676	(3)  In the event of a loss for which a dwelling or
2677	personal property is insured on the basis of replacement costs:
2678	(a)  For a dwelling, the insurer must initially pay at
2679	least the actual cash value of the insured loss, less any
2680	applicable deductible. The insurer shall pay any remaining
2681	amounts necessary to perform such repairs as work is performed
2682	and expenses are incurred. If a total loss of a dwelling occurs,
2683	the insurer shall pay the replacement cost coverage without
2684	reservation or holdback of any depreciation in value, pursuant
2685	to s. 627.702.
2686	(b)  For personal property:
2687	1.  The insurer must offer coverage under which the insurer
2688	is obligated to pay the replacement cost without reservation or
2689	holdback for any depreciation in value, whether or not the
2690	insured replaces the property.
2691	2.  The insurer may also offer coverage under which the
2692	insurer may limit the initial payment to the actual cash value
2693	of the personal property to be replaced, require the insured to
2694	provide receipts for the purchase of the property financed by
2695	the initial payment, use such receipts to make the next payment
2696	requested by the insured for the replacement of insured
2697	property, and continue this process until the insured remits all
2698	receipts up to the policy limits for replacement costs. The
2699	insurer must provide clear notice of this process before the
2700	policy is bound. A policyholder must be provided an actuarially
2701	reasonable premium credit or discount for this coverage. The
2702	insurer may not require the policyholder to advance payment for
2703	the replaced property, the insurer shall pay the replacement
2704	cost without reservation or holdback of any depreciation in
2705	value, whether or not the insured replaces or repairs the
2706	dwelling or property.
2707	(4)  A Any homeowner's insurance policy issued or renewed
2708	on or after October 1, 2005, must include in bold type no
2709	smaller than 18 points the following statement:
2710	"LAW AND ORDINANCE COVERAGE IS AN IMPORTANT COVERAGE
2711	THAT YOU MAY WISH TO PURCHASE. YOU MAY ALSO NEED TO
2712	CONSIDER THE PURCHASE OF FLOOD INSURANCE FROM THE
2713	NATIONAL FLOOD INSURANCE PROGRAM. WITHOUT THIS
2714	COVERAGE, YOU MAY HAVE UNCOVERED LOSSES. PLEASE
2715	DISCUSS THESE COVERAGES WITH YOUR INSURANCE AGENT."
2716
2717	The intent of this subsection is to encourage policyholders to
2718	purchase sufficient coverage to protect them in case events
2719	excluded from the standard homeowners policy, such as law and
2720	ordinance enforcement and flood, combine with covered events to
2721	produce damage or loss to the insured property. The intent is
2722	also to encourage policyholders to discuss these issues with
2723	their insurance agent.
2724	(5)  Nothing in This section does not: shall be construed
2725	to
2726	(a)  Apply to policies not considered to be "homeowners'
2727	policies," as that term is commonly understood in the insurance
2728	industry. This section specifically does not
2729	(b)  Apply to mobile home policies. Nothing in this section
2730	(c)  Limit shall be construed as limiting the ability of an
2731	any insurer to reject or nonrenew any insured or applicant on
2732	the grounds that the structure does not meet underwriting
2733	criteria applicable to replacement cost or law and ordinance
2734	policies or for other lawful reasons.
2735	(d)(6)  This section does not Prohibit an insurer from
2736	limiting its liability under a policy or endorsement providing
2737	that loss will be adjusted on the basis of replacement costs to
2738	the lesser of:
2739	1.(a)  The limit of liability shown on the policy
2740	declarations page;
2741	2.(b)  The reasonable and necessary cost to repair the
2742	damaged, destroyed, or stolen covered property; or
2743	3.(c)  The reasonable and necessary cost to replace the
2744	damaged, destroyed, or stolen covered property.
2745	(e)(7)  This section does not Prohibit an insurer from
2746	exercising its right to repair damaged property in compliance
2747	with its policy and s. 627.702(7).
2748	Section 21.  Paragraph (a) of subsection (5) of section
2749	627.70131, Florida Statutes, is amended to read:
2750	627.70131  Insurer's duty to acknowledge communications
2751	regarding claims; investigation.-
2752	(5)(a)  Within 90 days after an insurer receives notice of
2753	an initial, reopened, or supplemental a property insurance claim
2754	from a policyholder, the insurer shall pay or deny such claim or
2755	a portion of the claim unless the failure to pay such claim or a
2756	portion of the claim is caused by factors beyond the control of
2757	the insurer which reasonably prevent such payment. Any payment
2758	of an initial or supplemental a claim or portion of such a claim
2759	made paid 90 days after the insurer receives notice of the
2760	claim, or made paid more than 15 days after there are no longer
2761	factors beyond the control of the insurer which reasonably
2762	prevented such payment, whichever is later, bears shall bear
2763	interest at the rate set forth in s. 55.03. Interest begins to
2764	accrue from the date the insurer receives notice of the claim.
2765	The provisions of this subsection may not be waived, voided, or
2766	nullified by the terms of the insurance policy. If there is a
2767	right to prejudgment interest, the insured shall select whether
2768	to receive prejudgment interest or interest under this
2769	subsection. Interest is payable when the claim or portion of the
2770	claim is paid. Failure to comply with this subsection
2771	constitutes a violation of this code. However, failure to comply
2772	with this subsection does shall not form the sole basis for a
2773	private cause of action.
2774	Section 22.  The Legislature finds and declares:
2775	(1)  There is a compelling state interest in maintaining a
2776	viable and orderly private-sector market for property insurance
2777	in this state. The lack of a viable and orderly property market
2778	reduces the availability of property insurance coverage to state
2779	residents, increases the cost of property insurance, and
2780	increases the state's reliance on a residual property insurance
2781	market and its potential for imposing assessments on
2782	policyholders throughout the state.
2783	(2)  In 2005, the Legislature revised ss. 627.706-627.7074,
2784	Florida Statutes, to adopt certain geological or technical
2785	terms; to increase reliance on objective, scientific testing
2786	requirements; and generally to reduce the number of sinkhole
2787	claims and related disputes arising under prior law. The
2788	Legislature determined that since the enactment of these
2789	statutory revisions, both private-sector insurers and Citizens
2790	Property Insurance Corporation have, nevertheless, continued to
2791	experience high claims frequency and severity for sinkhole
2792	insurance claims. In addition, many properties remain unrepaired
2793	even after loss payments, which reduces the local property tax
2794	base and adversely affects the real estate market. Therefore,
2795	the Legislature finds that losses associated with sinkhole
2796	claims adversely affect the public health, safety, and welfare
2797	of this state and its citizens.
2798	(3)  Pursuant to sections 23 through 28 of this act,
2799	technical or scientific definitions adopted in the 2005
2800	legislation are clarified to implement and advance the
2801	Legislature's intended reduction of sinkhole claims and
2802	disputes. Certain other revisions to ss. 627.706-627.7074,
2803	Florida Statutes, are enacted to advance legislative intent to
2804	rely on scientific or technical determinations relating to
2805	sinkholes and sinkhole claims, reduce the number and cost of
2806	disputes relating to sinkhole claims, and ensure that repairs
2807	are made commensurate with the scientific and technical
2808	determinations and insurance claims payments.
2809	Section 23.  Section 627.706, Florida Statutes, is
2810	reordered and amended to read:
2811	627.706  Sinkhole insurance; catastrophic ground cover
2812	collapse; definitions.-
2813	(1)(a)  Every insurer authorized to transact property
2814	insurance in this state must shall provide coverage for a
2815	catastrophic ground cover collapse.
2816	(b)  The insurer and shall make available, for an
2817	appropriate additional premium, coverage for sinkhole losses on
2818	any structure, including the contents of personal property
2819	contained therein, to the extent provided in the form to which
2820	the coverage attaches. The insurer may require an inspection of
2821	the property before issuance of sinkhole loss coverage. A policy
2822	for residential property insurance may include a deductible
2823	amount applicable to sinkhole losses equal to 1 percent, 2
2824	percent, 5 percent, or 10 percent of the policy dwelling limits,
2825	with appropriate premium discounts offered with each deductible
2826	amount.
2827	(c)  The insurer may restrict catastrophic ground cover
2828	collapse and sinkhole loss coverage to the principal building,
2829	as defined in the applicable policy.
2830	(2)  As used in ss. 627.706-627.7074, and as used in
2831	connection with any policy providing coverage for a catastrophic
2832	ground cover collapse or for sinkhole losses, the term:
2833	(a)  "Catastrophic ground cover collapse" means geological
2834	activity that results in all the following:
2835	1.  The abrupt collapse of the ground cover;
2836	2.  A depression in the ground cover clearly visible to the
2837	naked eye;
2838	3.  Structural damage to the covered building, including
2839	the foundation; and
2840	4.  The insured structure being condemned and ordered to be
2841	vacated by the governmental agency authorized by law to issue
2842	such an order for that structure.
2843
2844	Contents coverage applies if there is a loss resulting from a
2845	catastrophic ground cover collapse. Structural Damage consisting
2846	merely of the settling or cracking of a foundation, structure,
2847	or building does not constitute a loss resulting from a
2848	catastrophic ground cover collapse.
2849	(b)  "Neutral evaluation" means the alternative dispute
2850	resolution provided in s. 627.7074.
2851	(c)  "Neutral evaluator" means a professional engineer or a
2852	professional geologist who has completed a course of study in
2853	alternative dispute resolution designed or approved by the
2854	department for use in the neutral evaluation process and who is
2855	determined by the department to be fair and impartial.
2856	(h)(b)  "Sinkhole" means a landform created by subsidence
2857	of soil, sediment, or rock as underlying strata are dissolved by
2858	groundwater. A sinkhole forms may form by collapse into
2859	subterranean voids created by dissolution of limestone or
2860	dolostone or by subsidence as these strata are dissolved.
2861	(j)(c)  "Sinkhole loss" means structural damage to the
2862	covered building, including the foundation, caused by sinkhole
2863	activity. Contents coverage and additional living expenses shall
2864	apply only if there is structural damage to the covered building
2865	caused by sinkhole activity.
2866	(i)(d)  "Sinkhole activity" means settlement or systematic
2867	weakening of the earth supporting the covered building such
2868	property only if the when such settlement or systematic
2869	weakening results from contemporaneous movement or raveling of
2870	soils, sediments, or rock materials into subterranean voids
2871	created by the effect of water on a limestone or similar rock
2872	formation.
2873	(f)(e)  "Professional engineer" means a person, as defined
2874	in s. 471.005, who has a bachelor's degree or higher in
2875	engineering with a specialty in the geotechnical engineering
2876	field. A professional engineer must also have geotechnical
2877	experience and expertise in the identification of sinkhole
2878	activity as well as other potential causes of structural damage
2879	to the structure.
2880	(g)(f)  "Professional geologist" means a person, as defined
2881	in by s. 492.102, who has a bachelor's degree or higher in
2882	geology or related earth science and with expertise in the
2883	geology of Florida. A professional geologist must have
2884	geological experience and expertise in the identification of
2885	sinkhole activity as well as other potential geologic causes of
2886	structural damage to the structure.
2887	(k)  "Structural damage" means a covered building,
2888	regardless of the date of its construction, has experienced the
2889	following:
2890	1.  Interior floor displacement or deflection in excess of
2891	acceptable variances as defined in ACI 117-90 or the Florida
2892	Building Code, which results in settlement related damage to the
2893	interior such that the interior building structure or members
2894	become unfit for service or represents a safety hazard as
2895	defined within the Florida Building Code;
2896	2.  Foundation displacement or deflection in excess of
2897	acceptable variances as defined in ACI 318-95 or the Florida
2898	Building Code, which results in settlement related damage to the
2899	primary structural members or primary structural systems that
2900	prevents those members or systems from supporting the loads and
2901	forces they were designed to support to the extent that stresses
2902	in those primary structural members or primary structural
2903	systems exceeds one and one-third the nominal strength allowed
2904	under the Florida Building Code for new buildings of similar
2905	structure, purpose, or location;
2906	3.  Damage that results in listing, leaning, or buckling of
2907	the exterior load bearing walls or other vertical primary
2908	structural members to such an extent that a plumb line passing
2909	through the center of gravity does not fall inside the middle
2910	one-third of the base as defined within the Florida Building
2911	Code;
2912	4.  Damage that results in the building, or any portion of
2913	the building containing primary structural members or primary
2914	structural systems, being significantly likely to imminently
2915	collapse because of the movement or instability of the ground
2916	within the influence zone of the supporting ground within the
2917	sheer plane necessary for the purpose of supporting such
2918	building as defined within the Florida Building Code; or
2919	5.  Damage occurring on or after October 15, 2005, that
2920	qualifies as "substantial structural damage" as defined in the
2921	Florida Building Code.
2922	(d)  "Primary structural member" means a structural element
2923	designed to provide support and stability for the vertical or
2924	lateral loads of the overall structure.
2925	(e)  "Primary structural system" means an assemblage of
2926	primary structural members.
2927	(3)  On or before June 1, 2007, Every insurer authorized to
2928	transact property insurance in this state shall make a proper
2929	filing with the office for the purpose of extending the
2930	appropriate forms of property insurance to include coverage for
2931	catastrophic ground cover collapse or for sinkhole losses.
2932	coverage for catastrophic ground cover collapse may not go into
2933	effect until the effective date provided for in the filing
2934	approved by the office.
2935	(3)(4)  Insurers offering policies that exclude coverage
2936	for sinkhole losses must shall inform policyholders in bold type
2937	of not less than 14 points as follows: "YOUR POLICY PROVIDES
2938	COVERAGE FOR A CATASTROPHIC GROUND COVER COLLAPSE THAT RESULTS
2939	IN THE PROPERTY BEING CONDEMNED AND UNINHABITABLE. OTHERWISE,
2940	YOUR POLICY DOES NOT PROVIDE COVERAGE FOR SINKHOLE LOSSES. YOU
2941	MAY PURCHASE ADDITIONAL COVERAGE FOR SINKHOLE LOSSES FOR AN
2942	ADDITIONAL PREMIUM."
2943	(4)(5)  An insurer offering sinkhole coverage to
2944	policyholders before or after the adoption of s. 30, chapter
2945	2007-1, Laws of Florida, may nonrenew the policies of
2946	policyholders maintaining sinkhole coverage in Pasco County or
2947	Hernando County, at the option of the insurer, and provide an
2948	offer of coverage that to such policyholders which includes
2949	catastrophic ground cover collapse and excludes sinkhole
2950	coverage. Insurers acting in accordance with this subsection are
2951	subject to the following requirements:
2952	(a)  Policyholders must be notified that a nonrenewal is
2953	for purposes of removing sinkhole coverage, and that the
2954	policyholder is still being offered a policy that provides
2955	coverage for catastrophic ground cover collapse.
2956	(b)  Policyholders must be provided an actuarially
2957	reasonable premium credit or discount for the removal of
2958	sinkhole coverage and provision of only catastrophic ground
2959	cover collapse.
2960	(c)  Subject to the provisions of this subsection and the
2961	insurer's approved underwriting or insurability guidelines, the
2962	insurer shall provide each policyholder with the opportunity to
2963	purchase an endorsement to his or her policy providing sinkhole
2964	coverage and may require an inspection of the property before
2965	issuance of a sinkhole coverage endorsement.
2966	(d)  Section 624.4305 does not apply to nonrenewal notices
2967	issued pursuant to this subsection.
2968	(5)  Any claim, including, but not limited to, initial,
2969	supplemental, and reopened claims under an insurance policy that
2970	provides sinkhole coverage is barred unless notice of the claim
2971	was given to the insurer in accordance with the terms of the
2972	policy within 2 years after the policyholder knew or reasonably
2973	should have known about the sinkhole loss.
2974	Section 24.  Section 627.7061, Florida Statutes, is amended
2975	to read:
2976	627.7061  Coverage inquiries.-Inquiries about coverage on a
2977	property insurance contract are not claim activity, unless an
2978	actual claim is filed by the policyholder which insured that
2979	results in a company investigation of the claim.
2980	Section 25.  Section 627.7065, Florida Statutes, is
2981	repealed.
2982	Section 26.  Section 627.707, Florida Statutes, is amended
2983	to read:
2984	627.707  Standards for Investigation of sinkhole claims by
2985	insurers; insurer payment; nonrenewals.-Upon receipt of a claim
2986	for a sinkhole loss to a covered building, an insurer must meet
2987	the following standards in investigating a claim:
2988	(1)  The insurer must inspect make an inspection of the
2989	policyholder's insured's premises to determine if there is
2990	structural has been physical damage that to the structure which
2991	may be the result of sinkhole activity.
2992	(2)  If the insurer confirms that structural damage exists
2993	but is unable to identify a valid cause of such damage or
2994	discovers that such damage is consistent with sinkhole loss
2995	Following the insurer's initial inspection, the insurer shall
2996	engage a professional engineer or a professional geologist to
2997	conduct testing as provided in s. 627.7072 to determine the
2998	cause of the loss within a reasonable professional probability
2999	and issue a report as provided in s. 627.7073, only if sinkhole
3000	loss is covered under the policy. Except as provided in
3001	subsections (4) and (6), the fees and costs of the professional
3002	engineer or professional geologist shall be paid by the
3003	insurer.:
3004	(a)  The insurer is unable to identify a valid cause of the
3005	damage or discovers damage to the structure which is consistent
3006	with sinkhole loss; or
3007	(b)  The policyholder demands testing in accordance with
3008	this section or s. 627.7072.
3009	(3)  Following the initial inspection of the policyholder's
3010	insured premises, the insurer shall provide written notice to
3011	the policyholder disclosing the following information:
3012	(a)  What the insurer has determined to be the cause of
3013	damage, if the insurer has made such a determination.
3014	(b)  A statement of the circumstances under which the
3015	insurer is required to engage a professional engineer or a
3016	professional geologist to verify or eliminate sinkhole loss and
3017	to engage a professional engineer to make recommendations
3018	regarding land and building stabilization and foundation repair.
3019	(c)  A statement regarding the right of the policyholder to
3020	request testing by a professional engineer or a professional
3021	geologist, and the circumstances under which the policyholder
3022	may demand certain testing, and the circumstances under which
3023	the policyholder may incur costs associated with testing.
3024	(4)(a)  If the insurer determines that there is no sinkhole
3025	loss, the insurer may deny the claim.
3026	(b)  If coverage for sinkhole loss is available and If the
3027	insurer denies the claim, without performing testing under s.
3028	627.7072, the policyholder may demand testing by the insurer
3029	under s. 627.7072.
3030	1.  The policyholder's demand for testing must be
3031	communicated to the insurer in writing within 60 days after the
3032	policyholder's receipt of the insurer's denial of the claim.
3033	2.  The policyholder shall pay 50 percent of the actual
3034	costs of the analyses and services provided under ss. 627.7072
3035	and 627.7073 or $2,500, whichever is less.
3036	3.  The insurer shall reimburse the policyholder for the
3037	costs if the insurer's engineer or geologist provides written
3038	certification pursuant to s. 627.7073 that there is sinkhole
3039	loss.
3040	(5)(a)  Subject to paragraph (b), If a sinkhole loss is
3041	verified, the insurer shall pay to stabilize the land and
3042	building and repair the foundation in accordance with the
3043	recommendations of the professional engineer retained pursuant
3044	to subsection (2), as provided under s. 627.7073, and in
3045	consultation with notice to the policyholder, subject to the
3046	coverage and terms of the policy. The insurer shall pay for
3047	other repairs to the structure and contents in accordance with
3048	the terms of the policy.
3049	(a)(b)  The insurer may limit its total claims payment to
3050	the actual cash value of the sinkhole loss, which does not
3051	include including underpinning or grouting or any other repair
3052	technique performed below the existing foundation of the
3053	building, until the policyholder enters into a contract for the
3054	performance of building stabilization or foundation repairs in
3055	accordance with the recommendations set forth in the insurer's
3056	report issued pursuant to s. 627.7073.
3057	(b)  In order to prevent additional damage to the building
3058	or structure, the policyholder must enter into a contract for
3059	the performance of building stabilization and foundation repairs
3060	within 90 days after the insurance company confirms coverage for
3061	the sinkhole loss and notifies the policyholder of such
3062	confirmation. This time period is tolled if either party invokes
3063	the neutral evaluation process, and begins again 10 days after
3064	the conclusion of the neutral evaluation process.
3065	(c)  After the policyholder enters into the contract for
3066	the performance of building stabilization and foundation
3067	repairs, the insurer shall pay the amounts necessary to begin
3068	and perform such repairs as the work is performed and the
3069	expenses are incurred. The insurer may not require the
3070	policyholder to advance payment for such repairs. If repair
3071	covered by a personal lines residential property insurance
3072	policy has begun and the professional engineer selected or
3073	approved by the insurer determines that the repair cannot be
3074	completed within the policy limits, the insurer must either
3075	complete the professional engineer's recommended repair or
3076	tender the policy limits to the policyholder without a reduction
3077	for the repair expenses incurred.
3078	(d)  The stabilization and all other repairs to the
3079	structure and contents must be completed within 12 months after
3080	entering into the contract for repairs described in paragraph
3081	(b) unless:
3082	1.  There is a mutual agreement between the insurer and the
3083	policyholder;
3084	2.  The claim is involved with the neutral evaluation
3085	process;
3086	3.  The claim is in litigation; or
3087	4.  The claim is under appraisal or mediation.
3088	(e)(c)  Upon the insurer's obtaining the written approval
3089	of the policyholder and any lienholder, the insurer may make
3090	payment directly to the persons selected by the policyholder to
3091	perform the land and building stabilization and foundation
3092	repairs. The decision by the insurer to make payment to such
3093	persons does not hold the insurer liable for the work performed.
3094	The policyholder may not accept a rebate from any person
3095	performing the repairs specified in this section. If a
3096	policyholder does receive a rebate, coverage is void and the
3097	policyholder must refund the amount of the rebate to the
3098	insurer. Any person making the repairs specified in this section
3099	who offers a rebate commits insurance fraud punishable as a
3100	third degree felony as provided in s. 775.082, s. 775.083, or s.
3101	775.084.
3102	(6)  Except as provided in subsection (7), the fees and
3103	costs of the professional engineer or the professional geologist
3104	shall be paid by the insurer.
3105	(6)(7)  If the insurer obtains, pursuant to s. 627.7073,
3106	written certification that there is no sinkhole loss or that the
3107	cause of the damage was not sinkhole activity, and if the
3108	policyholder has submitted the sinkhole claim without good faith
3109	grounds for submitting such claim, the policyholder shall
3110	reimburse the insurer for 50 percent of the actual costs of the
3111	analyses and services provided under ss. 627.7072 and 627.7073;
3112	however, a policyholder is not required to reimburse an insurer
3113	more than $2,500 with respect to any claim. A policyholder is
3114	required to pay reimbursement under this subsection only if the
3115	policyholder requested the analysis and services provided under
3116	ss. 627.7072 and 627.7073 and the insurer, before prior to
3117	ordering the analysis under s. 627.7072, informs the
3118	policyholder in writing of the policyholder's potential
3119	liability for reimbursement and gives the policyholder the
3120	opportunity to withdraw the claim.
3121	(7)(8)  An No insurer may not shall nonrenew any policy of
3122	property insurance on the basis of filing of claims for sinkhole
3123	partial loss if caused by sinkhole damage or clay shrinkage as
3124	long as the total of such payments does not equal or exceed the
3125	current policy limits of coverage for the policy in effect on
3126	the date of loss, for property damage to the covered building,
3127	as set forth on the declarations page, or if and provided the
3128	policyholder insured has repaired the structure in accordance
3129	with the engineering recommendations made pursuant to subsection
3130	(2) upon which any payment or policy proceeds were based. If the
3131	insurer pays such limits, it may nonrenew the policy.
3132	(8)(9)  The insurer may engage a professional structural
3133	engineer to make recommendations as to the repair of the
3134	structure.
3135	Section 27.  Section 627.7073, Florida Statutes, is amended
3136	to read:
3137	627.7073  Sinkhole reports.-
3138	(1)  Upon completion of testing as provided in s. 627.7072,
3139	the professional engineer or professional geologist shall issue
3140	a report and certification to the insurer and the policyholder
3141	as provided in this section.
3142	(a)  Sinkhole loss is verified if, based upon tests
3143	performed in accordance with s. 627.7072, a professional
3144	engineer or a professional geologist issues a written report and
3145	certification stating:
3146	1.  That structural damage to the covered building has been
3147	identified within a reasonable professional probability.
3148	2.1.  That the cause of the actual physical and structural
3149	damage is sinkhole activity within a reasonable professional
3150	probability.
3151	3.2.  That the analyses conducted were of sufficient scope
3152	to identify sinkhole activity as the cause of damage within a
3153	reasonable professional probability.
3154	4.3.  A description of the tests performed.
3155	5.4.  A recommendation by the professional engineer of
3156	methods for stabilizing the land and building and for making
3157	repairs to the foundation.
3158	(b)  If there is no structural damage or if sinkhole
3159	activity is eliminated as the cause of such damage to the
3160	covered building structure, the professional engineer or
3161	professional geologist shall issue a written report and
3162	certification to the policyholder and the insurer stating:
3163	1.  That there is no structural damage or the cause of such
3164	the damage is not sinkhole activity within a reasonable
3165	professional probability.
3166	2.  That the analyses and tests conducted were of
3167	sufficient scope to eliminate sinkhole activity as the cause of
3168	the structural damage within a reasonable professional
3169	probability.
3170	3.  A statement of the cause of the structural damage
3171	within a reasonable professional probability.
3172	4.  A description of the tests performed.
3173	(c)  The respective findings, opinions, and recommendations
3174	of the insurer's professional engineer or professional geologist
3175	as to the cause of distress to the property and the findings,
3176	opinions, and recommendations of the insurer's professional
3177	engineer as to land and building stabilization and foundation
3178	repair set forth by s. 627.7072 shall be presumed correct.
3179	(2)(a)  An Any insurer that has paid a claim for a sinkhole
3180	loss shall file a copy of the report and certification, prepared
3181	pursuant to subsection (1), including the legal description of
3182	the real property and the name of the property owner, the
3183	neutral evaluator's report, if any, which indicates that
3184	sinkhole activity caused the damage claimed, a copy of the
3185	certification indicating that stabilization has been completed,
3186	if applicable, and the amount of the payment, with the county
3187	clerk of court, who shall record the report and certification.
3188	The insurer shall bear the cost of filing and recording one or
3189	more reports and certifications the report and certification.
3190	There shall be no cause of action or liability against an
3191	insurer for compliance with this section.
3192	(a)  The recording of the report and certification does
3193	not:
3194	1.  Constitute a lien, encumbrance, or restriction on the
3195	title to the real property or constitute a defect in the title
3196	to the real property;
3197	2.  Create any cause of action or liability against any
3198	grantor of the real property for breach of any warranty of good
3199	title or warranty against encumbrances; or
3200	3.  Create any cause of action or liability against any
3201	title insurer that insures the title to the real property.
3202	(b)  As a precondition to accepting payment for a sinkhole
3203	loss, the policyholder must file a copy of any sinkhole report
3204	regarding the insured property which was prepared on behalf or
3205	at the request of the policyholder. The policyholder shall bear
3206	the cost of filing and recording the sinkhole report. The
3207	recording of the report does not:
3208	1.  Constitute a lien, encumbrance, or restriction on the
3209	title to the real property or constitute a defect in the title
3210	to the real property;
3211	2.  Create any cause of action or liability against any
3212	grantor of the real property for breach of any warranty of good
3213	title or warranty against encumbrances; or
3214	3.  Create any cause of action or liability against a title
3215	insurer that insures the title to the real property.
3216	(c)(b)  The seller of real property upon which a sinkhole
3217	claim has been made by the seller and paid by the insurer must
3218	shall disclose to the buyer of such property, before the
3219	closing, that a claim has been paid and whether or not the full
3220	amount of the proceeds were used to repair the sinkhole damage.
3221	(3)  Upon completion of any building stabilization or
3222	foundation repairs for a verified sinkhole loss, the
3223	professional engineer responsible for monitoring the repairs
3224	shall issue a report to the property owner which specifies what
3225	repairs have been performed and certifies within a reasonable
3226	degree of professional probability that such repairs have been
3227	properly performed. The professional engineer issuing the report
3228	shall file a copy of the report and certification, which
3229	includes a legal description of the real property and the name
3230	of the property owner, with the county clerk of the court, who
3231	shall record the report and certification. This subsection does
3232	not create liability for an insurer based on any representation
3233	or certification by a professional engineer related to the
3234	stabilization or foundation repairs for the verified sinkhole
3235	loss.
3236	Section 28.  Section 627.7074, Florida Statutes, is amended
3237	to read:
3238	627.7074  Alternative procedure for resolution of disputed
3239	sinkhole insurance claims.-
3240	(1)  As used in this section, the term:
3241	(a)  "Neutral evaluation" means the alternative dispute
3242	resolution provided for in this section.
3243	(b)  "Neutral evaluator" means a professional engineer or a
3244	professional geologist who has completed a course of study in
3245	alternative dispute resolution designed or approved by the
3246	department for use in the neutral evaluation process, who is
3247	determined to be fair and impartial.
3248	(1)(2)(a)  The department shall:
3249	(a)  Certify and maintain a list of persons who are neutral
3250	evaluators.
3251	(b)  The department shall Prepare a consumer information
3252	pamphlet for distribution by insurers to policyholders which
3253	clearly describes the neutral evaluation process and includes
3254	information and forms necessary for the policyholder to request
3255	a neutral evaluation.
3256	(2)  Neutral evaluation is available to either party if a
3257	sinkhole report has been issued pursuant to s. 627.7073. At a
3258	minimum, neutral evaluation must determine:
3259	(a)  Causation;
3260	(b)  All methods of stabilization and repair both above and
3261	below ground;
3262	(c)  The costs for stabilization and all repairs; and
3263	(d)  Information necessary to carry out subsection (12).
3264	(3)  Following the receipt of the report provided under s.
3265	627.7073 or the denial of a claim for a sinkhole loss, the
3266	insurer shall notify the policyholder of his or her right to
3267	participate in the neutral evaluation program under this
3268	section. Neutral evaluation supersedes the alternative dispute
3269	resolution process under s. 627.7015, but does not invalidate
3270	the appraisal clause of the insurance policy. The insurer shall
3271	provide to the policyholder the consumer information pamphlet
3272	prepared by the department pursuant to subsection (1)
3273	electronically or by United States mail paragraph (2)(b).
3274	(4)  Neutral evaluation is nonbinding, but mandatory if
3275	requested by either party. A request for neutral evaluation may
3276	be filed with the department by the policyholder or the insurer
3277	on a form approved by the department. The request for neutral
3278	evaluation must state the reason for the request and must
3279	include an explanation of all the issues in dispute at the time
3280	of the request. Filing a request for neutral evaluation tolls
3281	the applicable time requirements for filing suit for a period of
3282	60 days following the conclusion of the neutral evaluation
3283	process or the time prescribed in s. 95.11, whichever is later.
3284	(5)  Neutral evaluation shall be conducted as an informal
3285	process in which formal rules of evidence and procedure need not
3286	be observed. A party to neutral evaluation is not required to
3287	attend neutral evaluation if a representative of the party
3288	attends and has the authority to make a binding decision on
3289	behalf of the party. All parties shall participate in the
3290	evaluation in good faith. The neutral evaluator must be allowed
3291	reasonable access to the interior and exterior of insured
3292	structures to be evaluated or for which a claim has been made.
3293	Any reports initiated by the policyholder, or an agent of the
3294	policyholder, confirming a sinkhole loss or disputing another
3295	sinkhole report regarding insured structures must be provided to
3296	the neutral evaluator before the evaluator's physical inspection
3297	of the insured property.
3298	(6)  The insurer shall pay reasonable the costs associated
3299	with the neutral evaluation. However, if a party chooses to hire
3300	a court reporter or stenographer to contemporaneously record and
3301	document the neutral evaluation, that party must bear such
3302	costs.
3303	(7)  Upon receipt of a request for neutral evaluation, the
3304	department shall provide the parties a list of certified neutral
3305	evaluators. The parties shall mutually select a neutral
3306	evaluator from the list and promptly inform the department. If
3307	the parties cannot agree to a neutral evaluator within 10
3308	business days, The department shall allow the parties to submit
3309	requests to disqualify evaluators on the list for cause.
3310	(a)  The department shall disqualify neutral evaluators for
3311	cause based only on any of the following grounds:
3312	1.  A familial relationship exists between the neutral
3313	evaluator and either party or a representative of either party
3314	within the third degree.
3315	2.  The proposed neutral evaluator has, in a professional
3316	capacity, previously represented either party or a
3317	representative of either party, in the same or a substantially
3318	related matter.
3319	3.  The proposed neutral evaluator has, in a professional
3320	capacity, represented another person in the same or a
3321	substantially related matter and that person's interests are
3322	materially adverse to the interests of the parties. The term
3323	"substantially related matter" means participation by the
3324	neutral evaluator on the same claim, property, or adjacent
3325	property.
3326	4.  The proposed neutral evaluator has, within the
3327	preceding 5 years, worked as an employer or employee of any
3328	party to the case.
3329	(b)  The parties shall appoint a neutral evaluator from the
3330	department list and promptly inform the department. If the
3331	parties cannot agree to a neutral evaluator within 14 business
3332	days, the department shall appoint a neutral evaluator from the
3333	list of certified neutral evaluators. The department shall allow
3334	each party to disqualify two neutral evaluators without cause.
3335	Upon selection or appointment, the department shall promptly
3336	refer the request to the neutral evaluator.
3337	(c)  Within 14 5 business days after the referral, the
3338	neutral evaluator shall notify the policyholder and the insurer
3339	of the date, time, and place of the neutral evaluation
3340	conference. The conference may be held by telephone, if feasible
3341	and desirable. The neutral evaluator shall make reasonable
3342	efforts to hold the neutral evaluation conference shall be held
3343	within 90 45 days after the receipt of the request by the
3344	department. Failure of the neutral evaluator to hold the
3345	conference within 90 days does not invalidate either party's
3346	right to neutral evaluation or to a neutral evaluation
3347	conference held outside this timeframe.
3348	(8)  The department shall adopt rules of procedure for the
3349	neutral evaluation process.
3350	(8)(9)  For policyholders not represented by an attorney, a
3351	consumer affairs specialist of the department or an employee
3352	designated as the primary contact for consumers on issues
3353	relating to sinkholes under s. 20.121 shall be available for
3354	consultation to the extent that he or she may lawfully do so.
3355	(9)(10)  Evidence of an offer to settle a claim during the
3356	neutral evaluation process, as well as any relevant conduct or
3357	statements made in negotiations concerning the offer to settle a
3358	claim, is inadmissible to prove liability or absence of
3359	liability for the claim or its value, except as provided in
3360	subsection (14) (13).
3361	(10)(11)  Regardless of when noticed, any court proceeding
3362	related to the subject matter of the neutral evaluation shall be
3363	stayed pending completion of the neutral evaluation and for 5
3364	days after the filing of the neutral evaluator's report with the
3365	court.
3366	(11)  If, based upon his or her professional training and
3367	credentials, a neutral evaluator is qualified to determine only
3368	disputes relating to causation or method of repair, the
3369	department shall allow the neutral evaluator to enlist the
3370	assistance of another professional from the neutral evaluators
3371	list not previously stricken, who, based upon his or her
3372	professional training and credentials, is able to provide an
3373	opinion as to other disputed issues. A professional who would be
3374	disqualified for any reason listed in subsection (7) must be
3375	disqualified. The neutral evaluator may also use the services of
3376	professional engineers and professional geologists who are not
3377	certified as neutral evaluators, as well as licensed building
3378	contractors, in order to ensure that all items in dispute are
3379	addressed and the neutral evaluation can be completed. Any
3380	professional engineer, professional geologist, or licensed
3381	building contractor retained may be disqualified for any of the
3382	reasons listed in subsection (7). The neutral evaluator may
3383	request the entity that performed the investigation pursuant to
3384	s. 627.7072 perform such additional and reasonable testing as
3385	deemed necessary in the professional opinion of the neutral
3386	evaluator.
3387	(12)  At For matters that are not resolved by the parties
3388	at the conclusion of the neutral evaluation, the neutral
3389	evaluator shall prepare a report describing all matters that are
3390	the subject of the neutral evaluation, including whether,
3391	stating that in his or her opinion, the sinkhole loss has been
3392	verified or eliminated within a reasonable degree of
3393	professional probability and, if verified, whether the sinkhole
3394	activity caused structural damage to the covered building, and
3395	if so, the need for and estimated costs of stabilizing the land
3396	and any covered structures or buildings and other appropriate
3397	remediation or necessary building structural repairs due to the
3398	sinkhole loss. The evaluator's report shall be sent to all
3399	parties in attendance at the neutral evaluation and to the
3400	department, within 14 days after completing the neutral
3401	evaluation conference.
3402	(13)  The recommendation of the neutral evaluator is not
3403	binding on any party, and the parties retain access to the
3404	court. The neutral evaluator's written recommendation is
3405	admissible in any subsequent action, litigation, or proceeding
3406	relating to the claim or to the cause of action giving rise to
3407	the claim.
3408	(14)  If the neutral evaluator first verifies the existence
3409	of a sinkhole that caused structural damage and, second,
3410	recommends the need for and estimates costs of stabilizing the
3411	land and any covered structures or buildings and other
3412	appropriate remediation or building structural repairs, which
3413	costs exceed the amount that the insurer has offered to pay the
3414	policyholder, the insurer is liable to the policyholder for up
3415	to $2,500 in attorney's fees for the attorney's participation in
3416	the neutral evaluation process. For purposes of this subsection,
3417	the term "offer to pay" means a written offer signed by the
3418	insurer or its legal representative and delivered to the
3419	policyholder within 10 days after the insurer receives notice
3420	that a request for neutral evaluation has been made under this
3421	section.
3422	(15)  If the insurer timely agrees in writing to comply and
3423	timely complies with the recommendation of the neutral
3424	evaluator, but the policyholder declines to resolve the matter
3425	in accordance with the recommendation of the neutral evaluator
3426	pursuant to this section:
3427	(a)  The insurer is not liable for extracontractual damages
3428	related to a claim for a sinkhole loss but only as related to
3429	the issues determined by the neutral evaluation process. This
3430	section does not affect or impair claims for extracontractual
3431	damages unrelated to the issues determined by the neutral
3432	evaluation process contained in this section; and
3433	(b)  The actions of the insurer are not a confession of
3434	judgment or admission of liability, and the insurer is not
3435	liable for attorney's fees under s. 627.428 or other provisions
3436	of the insurance code unless the policyholder obtains a judgment
3437	that is more favorable than the recommendation of the neutral
3438	evaluator.
3439	(16)  If the insurer agrees to comply with the neutral
3440	evaluator's report, payments shall be made in accordance with
3441	the terms and conditions of the applicable insurance policy
3442	pursuant to s. 627.707(5).
3443	(17)  Neutral evaluators are deemed to be agents of the
3444	department and have immunity from suit as provided in s. 44.107.
3445	(18)  The department shall adopt rules of procedure for the
3446	neutral evaluation process.
3447	Section 29.  Subsection (8) of section 627.711, Florida
3448	Statutes, is amended to read:
3449	627.711  Notice of premium discounts for hurricane loss
3450	mitigation; uniform mitigation verification inspection form.-
3451	(8)  At its expense, the insurer may require that a any
3452	uniform mitigation verification form provided by a policyholder,
3453	a policyholder's agent, or an authorized mitigation inspector or
3454	inspection company be independently verified by an inspector, an
3455	inspection company, or an independent third-party quality
3456	assurance provider which possesses does possess a quality
3457	assurance program before prior to accepting the uniform
3458	mitigation verification form as valid.
3459	Section 30.  Subsection (1) of section 627.712, Florida
3460	Statutes, is amended to read:
3461	627.712  Residential windstorm coverage required;
3462	availability of exclusions for windstorm or contents.-
3463	(1)  An insurer issuing a residential property insurance
3464	policy must provide windstorm coverage. Except as provided in
3465	paragraph (2)(c), this section does not apply with respect to
3466	risks that are eligible for wind-only coverage from Citizens
3467	Property Insurance Corporation under s. 627.351(6), and with
3468	respect to risks that are not eligible for coverage from
3469	Citizens Property Insurance Corporation under s. 627.351(6)(a)3.
3470	or 5. A risk ineligible for Citizens coverage by the corporation
3471	under s. 627.351(6)(a)3. or 5. is exempt from the requirements
3472	of this section only if the risk is located within the
3473	boundaries of the coastal high-risk account of the corporation.
3474	Section 31.  Subsection (3) of section 631.54, Florida
3475	Statutes, is amended to read:
3476	631.54  Definitions.-As used in this part:
3477	(3)  "Covered claim" means an unpaid claim, including one
3478	of unearned premiums, which arises out of, and is within the
3479	coverage, and not in excess of, the applicable limits of an
3480	insurance policy to which this part applies, issued by an
3481	insurer, if such insurer becomes an insolvent insurer and the
3482	claimant or insured is a resident of this state at the time of
3483	the insured event or the property from which the claim arises is
3484	permanently located in this state. For entities other than
3485	individuals, the residence of a claimant, insured, or
3486	policyholder is the state in which the entity's principal place
3487	of business is located at the time of the insured event. The
3488	term does "Covered claim" shall not include:
3489	(a)  Any amount due any reinsurer, insurer, insurance pool,
3490	or underwriting association, sought directly or indirectly
3491	through a third party, as subrogation, contribution,
3492	indemnification, or otherwise; or
3493	(b)  Any claim that would otherwise be a covered claim
3494	under this part that has been rejected by any other state
3495	guaranty fund on the grounds that an insured's net worth is
3496	greater than that allowed under that state's guaranty law.
3497	Member insurers shall have no right of subrogation,
3498	contribution, indemnification, or otherwise, sought directly or
3499	indirectly through a third party, against the insured of any
3500	insolvent member; or
3501	(c)  Any amount payable for a sinkhole loss other than
3502	testing deemed appropriate by the association or payable for the
3503	actual repair of the loss, except that the association may not
3504	pay for attorney's fees or public adjuster's fees in connection
3505	with a sinkhole loss or pay the policyholder. The association
3506	may pay for actual repairs to the property, but is not liable
3507	for amounts in excess of policy limits.
3508	Section 32.  If any provision of this act, or the
3509	application thereof to any person or circumstance is held
3510	invalid, such invalidity shall not affect other provisions or
3511	applications of this act which can be given effect without the
3512	invalid provision or application. It is the express intent of
3513	the Legislature to enact multiple important, but independent,
3514	reforms to Florida law relating to sinkhole insurance coverage
3515	and related claims. The Legislature further intends that the
3516	multiple reforms in the act could and should be enforced if one
3517	or more provisions are held invalid. To this end, the provisions
3518	of this act are declared to be severable.
3519	Section 33.  Except as otherwise expressly provided in this
3520	act, this act shall take effect upon becoming a law.
3521
3522
3523	-----------------------------------------------------
3524	T I T L E  A M E N D M E N T
3525	Remove the entire title and insert:
3526	A bill to be entitled
3527	An act relating to property and casualty insurance;
3528	amending s. 95.11, F.S.; specifying a statute of
3529	limitation for a breach of a property insurance contract
3530	runs from the date of loss; amending s. 215.555, F.S.;
3531	revising the definition of "losses," relating to the
3532	Florida Hurricane Catastrophe Fund, to exclude certain
3533	losses; providing applicability; amending s. 215.5595,
3534	F.S.; authorizing an insurer to renegotiate the terms a
3535	surplus note issued before a certain date; providing
3536	limitations; amending s. 624.407, F.S.; revising the
3537	amount of surplus funds required for domestic insurers
3538	applying for a certificate of authority; amending s.
3539	624.408, F.S.; revising the minimum surplus that must be
3540	maintained by certain insurers; authorizing the Office of
3541	Insurance Regulation to reduce the surplus requirement
3542	under specified circumstances; amending s. 626.852, F.S.;
3543	providing an exemption from licensure as an adjuster to
3544	persons who provide mortgage-related claims adjusting
3545	services to certain institutions; providing an exception
3546	to the exemption; amending s. 626.854, F.S.; providing
3547	limitations on the amount of compensation that may be
3548	received by a public adjuster for a reopened or
3549	supplemental claim; providing limitations on the amount of
3550	compensation that may be received by a public adjuster for
3551	a claim; applying specified provisions regulating the
3552	conduct of public adjusters to condominium unit owners
3553	rather than to condominium associations as is currently
3554	required; providing statements that may be considered
3555	deceptive or misleading if made in any public adjuster's
3556	advertisement or solicitation; providing a definition for
3557	the term "written advertisement"; requiring that a
3558	disclaimer be included in any public adjuster's written
3559	advertisement; providing requirements for such disclaimer;
3560	requiring certain persons who act on behalf of an insurer
3561	to provide notice to the insurer, claimant, public
3562	adjuster, or legal representative for an onsite inspection
3563	of the insured property; authorizing the insured or
3564	claimant to deny access to the property if notice is not
3565	provided; requiring the public adjuster to ensure prompt
3566	notice of certain property loss claims; providing that an
3567	insurer be allowed to interview the insured directly about
3568	the loss claim; prohibiting the insurer from obstructing
3569	or preventing the public adjuster from communicating with
3570	the insured; requiring that the insurer communicate with
3571	the public adjuster in an effort to reach an agreement as
3572	to the scope of the covered loss under the insurance
3573	policy; prohibiting a public adjuster from restricting or
3574	preventing persons acting on behalf of the insured from
3575	having reasonable access to the insured or the insured's
3576	property; prohibiting a public adjuster from restricting
3577	or preventing the insured's adjuster from having
3578	reasonable access to or inspecting the insured's property;
3579	authorizing the insured's adjuster to be present for the
3580	inspection; prohibiting a licensed contractor or
3581	subcontractor from adjusting a claim on behalf of an
3582	insured if such contractor or subcontractor is not a
3583	licensed public adjuster; providing an exception; amending
3584	s. 626.8796, F.S.; providing requirements for a public
3585	adjuster contract; creating s. 626.70132, F.S.; requiring
3586	that notice of a claim, supplemental claim, or reopened
3587	claim be given to the insurer within a specified period
3588	after a windstorm or hurricane occurs; providing a
3589	definition for the terms "supplemental claim" or "reopened
3590	claim"; providing applicability; repealing s. 627.0613(4),
3591	F.S., relating to the requirement that the consumer
3592	advocate for the Chief Financial Officer prepare an annual
3593	report card for each personal residential property
3594	insurer; amending s. 627.062, F.S.; extending the
3595	expiration date for making a "file and use" filing;
3596	prohibiting the Office of Insurance Regulation from,
3597	directly or indirectly, impeding the right of an insurer
3598	to acquire policyholders, advertise or appoint agents, or
3599	regulate agent commissions; revising the information that
3600	must be included in a rate filing relating to certain
3601	reinsurance or financing products; deleting a provision
3602	that prohibited an insurer from making certain rate
3603	filings within a certain period of time after a rate
3604	increase; deleting a provision prohibiting an insurer from
3605	filing for a rate increase within 6 months after it makes
3606	certain rate filings; deleting obsolete provisions
3607	relating to legislation enacted during the 2003 Special
3608	Session D of the Legislature; providing for the submission
3609	of additional or supplementary information pursuant to a
3610	rate filing; revising provisions relating to the
3611	certifications that are required to be made under oath by
3612	certain officers or actuaries of an insurer regarding
3613	information that must accompany a rate filing; amending s.
3614	627.06281, F.S.; providing limitations on fees charged for
3615	use of the public hurricane model; amending s. 627.0629,
3616	F.S.; deleting obsolete provisions; deleting a requirement
3617	that the Office of Insurance Regulation propose a method
3618	for establishing discounts, debits, credits, and other
3619	rate differentials for hurricane mitigation by a certain
3620	date; conforming provisions to changes made by the act;
3621	amending s. 627.351, F.S.; limiting an adjuster's fee for
3622	a claim against the corporation; renaming the "high-risk
3623	account" as the "coastal account"; revising the conditions
3624	under which the Citizens policyholder surcharge may be
3625	imposed; providing that members of the Citizens Property
3626	Insurance Corporation Board of Governors are not
3627	prohibited from practicing in a certain profession if not
3628	prohibited by law or ordinance; requiring the corporation
3629	to commission a consultant to prepare a report on
3630	outsourcing various functions and to submit such report to
3631	the Financial Services Commission by a certain date;
3632	limiting coverage for damage from sinkholes after a
3633	certain date; requiring the policyholders to sign a
3634	statement acknowledging that they may be assessed
3635	surcharges to cover corporate deficits; prohibiting board
3636	members from voting on certain measures; exempting
3637	sinkhole coverage from the corporation's annual rate
3638	increase requirements; deleting a requirement that the
3639	board provide an annual report to the Legislature relating
3640	to certain coverages; deleting a requirement that the
3641	board reduce the boundaries of certain high-risk areas
3642	eligible for wind-only coverages under certain
3643	circumstances; amending s. 627.3511, F.S.; conforming
3644	provisions to changes made by the act; amending s.
3645	627.4133, F.S.; revising the requirements for providing an
3646	insured with notice of nonrenewal, cancellation, or
3647	termination of personal lines or commercial residential
3648	property insurance; authorizing an insurer to cancel
3649	policies after 45 days' notice if the Office of Insurance
3650	Regulation determines that the cancellation of policies is
3651	necessary to protect the interests of the public or
3652	policyholders; authorizing the Office of Insurance
3653	Regulation to place an insurer under administrative
3654	supervision or appoint a receiver upon the consent of the
3655	insurer under certain circumstances; providing criteria
3656	and notice requirements relating to the nonrenewal of
3657	policy covering both a home and motor vehicle; creating s.
3658	627.43141, F.S.; providing definitions; requiring the
3659	delivery of a "Notice of Change in Policy Terms" under
3660	certain circumstances; specifying requirements for such
3661	notice; specifying actions constituting proof of notice;
3662	authorizing policy renewals to contain a change in policy
3663	terms; providing that receipt of payment by an insurer is
3664	deemed acceptance of new policy terms by an insured;
3665	providing that the original policy remains in effect until
3666	the occurrence of specified events if an insurer fails to
3667	provide notice; providing intent; amending s. 627.7011,
3668	F.S.; requiring the insurer to pay the actual cash value
3669	of an insured loss for a dwelling, less any applicable
3670	deductible; requiring the insurer to offer coverage under
3671	which the insurer is obligated to pay replacement costs;
3672	authorizing the insurer to offer coverage that limits the
3673	initial payment for personal property to the actual cash
3674	value of the property to be replaced and to require the
3675	insured to provide receipts for purchases; requiring the
3676	insurer to provide notice of this process before the
3677	policy is bound; requiring certain premium credits or
3678	discounts for such coverage; prohibiting an insurer from
3679	requiring the insured to advance payment; amending s.
3680	627.70131, F.S.; specifying application of certain time
3681	periods to initial or supplemental property insurance
3682	claim notices and payments; providing legislative findings
3683	with respect to 2005 statutory changes relating to
3684	sinkhole insurance coverage and statutory changes in this
3685	act; amending s. 627.706, F.S.; authorizing an insurer to
3686	limit coverage for catastrophic ground cover collapse to
3687	the principal building; authorizing an insurer to require
3688	an inspection before issuance of sinkhole loss coverage;
3689	revising definitions; defining the term "structural
3690	damage"; placing a 2-year statute of repose on claims for
3691	sinkhole coverage; amending s. 627.7061, F.S.; conforming
3692	provisions to changes made by the act; repealing s.
3693	627.7065, F.S., relating to the establishment of a
3694	sinkhole database; amending s. 627.707, F.S.; revising
3695	provisions relating to the investigation of sinkholes by
3696	insurers; providing a time limitation for demanding
3697	sinkhole testing by a policyholder and entering into a
3698	contract for repairs; requiring all repairs to be
3699	completed within a certain time; providing exceptions;
3700	providing criminal penalties for a person performing
3701	repairs who offers a rebate; amending s. 627.7073, F.S.;
3702	revising provisions relating to inspection reports;
3703	revising the reports that an insurer must file with the
3704	clerk of the court; requiring the policyholder to file
3705	certain reports as a precondition to accepting payment;
3706	requiring the professional engineer responsible for
3707	monitoring sinkhole repairs to issue a report and
3708	certification to the property owner and file such report
3709	with the court; providing that the act does not create
3710	liability for an insurer based on a representation or
3711	certification by the engineer; amending s. 627.7074, F.S.;
3712	revising provisions relating to neutral evaluation;
3713	requiring evaluation in order to make certain
3714	determinations; requiring that the neutral evaluator be
3715	allowed access to structures being evaluated; providing
3716	grounds for disqualifying an evaluator; allowing the
3717	Department of Financial Services to appoint an evaluator
3718	if the parties cannot come to agreement; revising the
3719	timeframes for scheduling a neutral evaluation conference;
3720	authorizing an evaluator to enlist another evaluator or
3721	other professionals; providing a time certain for issuing
3722	a report; revising provisions relating to compliance with
3723	the evaluator's recommendations; providing that the
3724	evaluator is an agent of the department for the purposes
3725	of immunity from suit; requiring the department to adopt
3726	rules; amending s. 627.711, F.S.; revising the requirement
3727	that the insurer pay for verification of a uniform
3728	mitigation verification form that the insurer requires;
3729	amending s. 627.712, F.S.; conforming provisions to
3730	changes made by the act; amending s. 631.54, F.S.;
3731	revising the definition of the term "covered claim" for
3732	purposes of the Florida Insurance Guaranty Association
3733	Act; providing for applicability; providing severability;
3734	providing effective dates.

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