Florida Senate - 2021                        COMMITTEE AMENDMENT
       Bill No. CS for SB 1574
       
       
       
       
       
       
                                Ì610716"Î610716                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  04/08/2021           .                                
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       Appropriations Subcommittee on Agriculture, Environment, and
       General Government (Brandes) recommended the following:
       
    1         Senate Substitute for Amendment (133436) (with title
    2  amendment)
    3  
    4         Delete lines 370 - 977
    5  and insert:
    6         (c) The corporation’s plan of operation:
    7         1. Must provide for adoption of residential property and
    8  casualty insurance policy forms and commercial residential and
    9  nonresidential property insurance forms, which must be approved
   10  by the office before use. The corporation shall adopt the
   11  following policy forms:
   12         a. Standard personal lines policy forms that are
   13  comprehensive multiperil policies providing full coverage of a
   14  residential property equivalent to the coverage provided in the
   15  private insurance market under an HO-3, HO-4, or HO-6 policy.
   16         b. Basic personal lines policy forms that are policies
   17  similar to an HO-8 policy or a dwelling fire policy that provide
   18  coverage meeting the requirements of the secondary mortgage
   19  market, but which is more limited than the coverage under a
   20  standard policy.
   21         c. Commercial lines residential and nonresidential policy
   22  forms that are generally similar to the basic perils of full
   23  coverage obtainable for commercial residential structures and
   24  commercial nonresidential structures in the admitted voluntary
   25  market.
   26         d. Personal lines and commercial lines residential property
   27  insurance forms that cover the peril of wind only. The forms are
   28  applicable only to residential properties located in areas
   29  eligible for coverage under the coastal account referred to in
   30  sub-subparagraph (b)2.a.
   31         e. Commercial lines nonresidential property insurance forms
   32  that cover the peril of wind only. The forms are applicable only
   33  to nonresidential properties located in areas eligible for
   34  coverage under the coastal account referred to in sub
   35  subparagraph (b)2.a.
   36         f. The corporation may adopt variations of the policy forms
   37  listed in sub-subparagraphs a.-e. which contain more restrictive
   38  coverage.
   39         g. Effective January 1, 2013, the corporation shall offer a
   40  basic personal lines policy similar to an HO-8 policy with
   41  dwelling repair based on common construction materials and
   42  methods.
   43         2. Must provide that the corporation adopt a program in
   44  which the corporation and authorized insurers enter into quota
   45  share primary insurance agreements for hurricane coverage, as
   46  defined in s. 627.4025(2)(a), for eligible risks, and adopt
   47  property insurance forms for eligible risks which cover the
   48  peril of wind only.
   49         a. As used in this subsection, the term:
   50         (II)“Primary residence” means the dwelling that the
   51  insured has represented as their permanent home on the insurance
   52  application or otherwise to the corporation.
   53         (III)(I) “Quota share primary insurance” means an
   54  arrangement in which the primary hurricane coverage of an
   55  eligible risk is provided in specified percentages by the
   56  corporation and an authorized insurer. The corporation and
   57  authorized insurer are each solely responsible for a specified
   58  percentage of hurricane coverage of an eligible risk as set
   59  forth in a quota share primary insurance agreement between the
   60  corporation and an authorized insurer and the insurance
   61  contract. The responsibility of the corporation or authorized
   62  insurer to pay its specified percentage of hurricane losses of
   63  an eligible risk, as set forth in the agreement, may not be
   64  altered by the inability of the other party to pay its specified
   65  percentage of losses. Eligible risks that are provided hurricane
   66  coverage through a quota share primary insurance arrangement
   67  must be provided policy forms that set forth the obligations of
   68  the corporation and authorized insurer under the arrangement,
   69  clearly specify the percentages of quota share primary insurance
   70  provided by the corporation and authorized insurer, and
   71  conspicuously and clearly state that the authorized insurer and
   72  the corporation may not be held responsible beyond their
   73  specified percentage of coverage of hurricane losses.
   74         (I)(II) “Eligible risks” means personal lines residential
   75  and commercial lines residential risks that meet the
   76  underwriting criteria of the corporation and are located in
   77  areas that were eligible for coverage by the Florida Windstorm
   78  Underwriting Association on January 1, 2002.
   79         b. The corporation may enter into quota share primary
   80  insurance agreements with authorized insurers at corporation
   81  coverage levels of 90 percent and 50 percent.
   82         c. If the corporation determines that additional coverage
   83  levels are necessary to maximize participation in quota share
   84  primary insurance agreements by authorized insurers, the
   85  corporation may establish additional coverage levels. However,
   86  the corporation’s quota share primary insurance coverage level
   87  may not exceed 90 percent.
   88         d. Any quota share primary insurance agreement entered into
   89  between an authorized insurer and the corporation must provide
   90  for a uniform specified percentage of coverage of hurricane
   91  losses, by county or territory as set forth by the corporation
   92  board, for all eligible risks of the authorized insurer covered
   93  under the agreement.
   94         e. Any quota share primary insurance agreement entered into
   95  between an authorized insurer and the corporation is subject to
   96  review and approval by the office. However, such agreement shall
   97  be authorized only as to insurance contracts entered into
   98  between an authorized insurer and an insured who is already
   99  insured by the corporation for wind coverage.
  100         f. For all eligible risks covered under quota share primary
  101  insurance agreements, the exposure and coverage levels for both
  102  the corporation and authorized insurers shall be reported by the
  103  corporation to the Florida Hurricane Catastrophe Fund. For all
  104  policies of eligible risks covered under such agreements, the
  105  corporation and the authorized insurer must maintain complete
  106  and accurate records for the purpose of exposure and loss
  107  reimbursement audits as required by fund rules. The corporation
  108  and the authorized insurer shall each maintain duplicate copies
  109  of policy declaration pages and supporting claims documents.
  110         g. The corporation board shall establish in its plan of
  111  operation standards for quota share agreements which ensure that
  112  there is no discriminatory application among insurers as to the
  113  terms of the agreements, pricing of the agreements, incentive
  114  provisions if any, and consideration paid for servicing policies
  115  or adjusting claims.
  116         h. The quota share primary insurance agreement between the
  117  corporation and an authorized insurer must set forth the
  118  specific terms under which coverage is provided, including, but
  119  not limited to, the sale and servicing of policies issued under
  120  the agreement by the insurance agent of the authorized insurer
  121  producing the business, the reporting of information concerning
  122  eligible risks, the payment of premium to the corporation, and
  123  arrangements for the adjustment and payment of hurricane claims
  124  incurred on eligible risks by the claims adjuster and personnel
  125  of the authorized insurer. Entering into a quota sharing
  126  insurance agreement between the corporation and an authorized
  127  insurer is voluntary and at the discretion of the authorized
  128  insurer.
  129         3. May provide that the corporation may employ or otherwise
  130  contract with individuals or other entities to provide
  131  administrative or professional services that may be appropriate
  132  to effectuate the plan. The corporation may borrow funds by
  133  issuing bonds or by incurring other indebtedness, and shall have
  134  other powers reasonably necessary to effectuate the requirements
  135  of this subsection, including, without limitation, the power to
  136  issue bonds and incur other indebtedness in order to refinance
  137  outstanding bonds or other indebtedness. The corporation may
  138  seek judicial validation of its bonds or other indebtedness
  139  under chapter 75. The corporation may issue bonds or incur other
  140  indebtedness, or have bonds issued on its behalf by a unit of
  141  local government pursuant to subparagraph (q)2. in the absence
  142  of a hurricane or other weather-related event, upon a
  143  determination by the corporation, subject to approval by the
  144  office, that such action would enable it to efficiently meet the
  145  financial obligations of the corporation and that such
  146  financings are reasonably necessary to effectuate the
  147  requirements of this subsection. The corporation may take all
  148  actions needed to facilitate tax-free status for such bonds or
  149  indebtedness, including formation of trusts or other affiliated
  150  entities. The corporation may pledge assessments, projected
  151  recoveries from the Florida Hurricane Catastrophe Fund, other
  152  reinsurance recoverables, policyholder surcharges and other
  153  surcharges, and other funds available to the corporation as
  154  security for bonds or other indebtedness. In recognition of s.
  155  10, Art. I of the State Constitution, prohibiting the impairment
  156  of obligations of contracts, it is the intent of the Legislature
  157  that no action be taken whose purpose is to impair any bond
  158  indenture or financing agreement or any revenue source committed
  159  by contract to such bond or other indebtedness.
  160         4. Must require that the corporation operate subject to the
  161  supervision and approval of a board of governors consisting of
  162  nine individuals who are residents of this state and who are
  163  from different geographical areas of this the state, one of whom
  164  is appointed by the Governor and serves solely to advocate on
  165  behalf of the consumer. The appointment of a consumer
  166  representative by the Governor is deemed to be within the scope
  167  of the exemption provided in s. 112.313(7)(b) and is in addition
  168  to the appointments authorized under sub-subparagraph a.
  169         a. The Governor, the Chief Financial Officer, the President
  170  of the Senate, and the Speaker of the House of Representatives
  171  shall each appoint two members of the board. At least one of the
  172  two members appointed by each appointing officer must have
  173  demonstrated expertise in insurance and be deemed to be within
  174  the scope of the exemption provided in s. 112.313(7)(b). The
  175  Chief Financial Officer shall designate one of the appointees as
  176  chair. All board members serve at the pleasure of the appointing
  177  officer. All members of the board are subject to removal at will
  178  by the officers who appointed them. All board members, including
  179  the chair, must be appointed to serve for 3-year terms beginning
  180  annually on a date designated by the plan. However, for the
  181  first term beginning on or after July 1, 2009, each appointing
  182  officer shall appoint one member of the board for a 2-year term
  183  and one member for a 3-year term. A board vacancy shall be
  184  filled for the unexpired term by the appointing officer. The
  185  Chief Financial Officer shall appoint a technical advisory group
  186  to provide information and advice to the board in connection
  187  with the board’s duties under this subsection. The executive
  188  director and senior managers of the corporation shall be engaged
  189  by the board and serve at the pleasure of the board. Any
  190  executive director appointed on or after July 1, 2006, is
  191  subject to confirmation by the Senate. The executive director is
  192  responsible for employing other staff as the corporation may
  193  require, subject to review and concurrence by the board.
  194         b. The board shall create a Market Accountability Advisory
  195  Committee to assist the corporation in developing awareness of
  196  its rates and its customer and agent service levels in
  197  relationship to the voluntary market insurers writing similar
  198  coverage.
  199         (I) The members of the advisory committee consist of the
  200  following 11 persons, one of whom must be elected chair by the
  201  members of the committee: four representatives, one appointed by
  202  the Florida Association of Insurance Agents, one by the Florida
  203  Association of Insurance and Financial Advisors, one by the
  204  Professional Insurance Agents of Florida, and one by the Latin
  205  American Association of Insurance Agencies; three
  206  representatives appointed by the insurers with the three highest
  207  voluntary market share of residential property insurance
  208  business in this the state; one representative from the Office
  209  of Insurance Regulation; one consumer appointed by the board who
  210  is insured by the corporation at the time of appointment to the
  211  committee; one representative appointed by the Florida
  212  Association of Realtors; and one representative appointed by the
  213  Florida Bankers Association. All members shall be appointed to
  214  3-year terms and may serve for consecutive terms.
  215         (II) The committee shall report to the corporation at each
  216  board meeting on insurance market issues that which may include
  217  rates and rate competition with the voluntary market; service,
  218  including policy issuance, claims processing, and general
  219  responsiveness to policyholders, applicants, and agents; and
  220  matters relating to depopulation.
  221         5. Must provide a procedure for determining the eligibility
  222  of a risk for coverage, as follows:
  223         a. Subject to s. 627.3517, with respect to personal lines
  224  residential risks, if the risk is offered coverage from an
  225  authorized insurer at the insurer’s approved rate under a
  226  standard policy including wind coverage or, if consistent with
  227  the insurer’s underwriting rules as filed with the office, a
  228  basic policy including wind coverage, for a new application to
  229  the corporation for coverage, the risk is not eligible for any
  230  policy issued by the corporation unless the premium for coverage
  231  from the authorized insurer is more than 15 percent greater than
  232  the premium for comparable coverage from the corporation.
  233  Whenever an offer of coverage for a personal lines residential
  234  risk is received for a policyholder of the corporation at
  235  renewal from an authorized insurer, if the offer is equal to or
  236  less than the corporation’s renewal premium for comparable
  237  coverage, the risk is not eligible for coverage with the
  238  corporation unless the premium for comparable coverage from the
  239  authorized insurer is more than 15 percent greater than the
  240  premium under subparagraph (n)1. for personal residential
  241  properties that are not the insured’s primary residence. If the
  242  risk is not able to obtain such offer, the risk is eligible for
  243  a standard policy including wind coverage or a basic policy
  244  including wind coverage issued by the corporation; however, if
  245  the risk could not be insured under a standard policy including
  246  wind coverage regardless of market conditions, the risk is
  247  eligible for a basic policy including wind coverage unless
  248  rejected under subparagraph 8. However, a policyholder removed
  249  from the corporation through an assumption agreement remains
  250  eligible for coverage from the corporation until the end of the
  251  assumption period. The corporation shall determine the type of
  252  policy to be provided on the basis of objective standards
  253  specified in the underwriting manual and based on generally
  254  accepted underwriting practices.
  255         (I) If the risk accepts an offer of coverage through the
  256  market assistance plan or through a mechanism established by the
  257  corporation other than a plan established by s. 627.3518, before
  258  a policy is issued to the risk by the corporation or during the
  259  first 30 days of coverage by the corporation, and the producing
  260  agent who submitted the application to the plan or to the
  261  corporation is not currently appointed by the insurer, the
  262  insurer shall:
  263         (A) Pay to the producing agent of record of the policy for
  264  the first year, an amount that is the greater of the insurer’s
  265  usual and customary commission for the type of policy written or
  266  a fee equal to the usual and customary commission of the
  267  corporation; or
  268         (B) Offer to allow the producing agent of record of the
  269  policy to continue servicing the policy for at least 1 year and
  270  offer to pay the agent the greater of the insurer’s or the
  271  corporation’s usual and customary commission for the type of
  272  policy written.
  273  
  274  If the producing agent is unwilling or unable to accept
  275  appointment, the new insurer shall pay the agent in accordance
  276  with sub-sub-sub-subparagraph (A).
  277         (II) If the corporation enters into a contractual agreement
  278  for a take-out plan, the producing agent of record of the
  279  corporation policy is entitled to retain any unearned commission
  280  on the policy, and the insurer shall:
  281         (A) Pay to the producing agent of record, for the first
  282  year, an amount that is the greater of the insurer’s usual and
  283  customary commission for the type of policy written or a fee
  284  equal to the usual and customary commission of the corporation;
  285  or
  286         (B) Offer to allow the producing agent of record to
  287  continue servicing the policy for at least 1 year and offer to
  288  pay the agent the greater of the insurer’s or the corporation’s
  289  usual and customary commission for the type of policy written.
  290  
  291  If the producing agent is unwilling or unable to accept
  292  appointment, the new insurer shall pay the agent in accordance
  293  with sub-sub-sub-subparagraph (A).
  294         b. With respect to commercial lines residential risks, for
  295  a new application to the corporation for coverage, if the risk
  296  is offered coverage under a policy including wind coverage from
  297  an authorized insurer at its approved rate, the risk is not
  298  eligible for a policy issued by the corporation unless the
  299  premium for coverage from the authorized insurer is more than 15
  300  percent greater than the premium for comparable coverage from
  301  the corporation. Whenever an offer of coverage for a commercial
  302  lines residential risk is received for a policyholder of the
  303  corporation at renewal from an authorized insurer, if the offer
  304  is equal to or less than the corporation’s renewal premium for
  305  comparable coverage, the risk is not eligible for coverage with
  306  the corporation. If the risk is not able to obtain any such
  307  offer, the risk is eligible for a policy including wind coverage
  308  issued by the corporation. However, a policyholder removed from
  309  the corporation through an assumption agreement remains eligible
  310  for coverage from the corporation until the end of the
  311  assumption period.
  312         (I) If the risk accepts an offer of coverage through the
  313  market assistance plan or through a mechanism established by the
  314  corporation other than a plan established by s. 627.3518, before
  315  a policy is issued to the risk by the corporation or during the
  316  first 30 days of coverage by the corporation, and the producing
  317  agent who submitted the application to the plan or the
  318  corporation is not currently appointed by the insurer, the
  319  insurer shall:
  320         (A) Pay to the producing agent of record of the policy, for
  321  the first year, an amount that is the greater of the insurer’s
  322  usual and customary commission for the type of policy written or
  323  a fee equal to the usual and customary commission of the
  324  corporation; or
  325         (B) Offer to allow the producing agent of record of the
  326  policy to continue servicing the policy for at least 1 year and
  327  offer to pay the agent the greater of the insurer’s or the
  328  corporation’s usual and customary commission for the type of
  329  policy written.
  330  
  331  If the producing agent is unwilling or unable to accept
  332  appointment, the new insurer shall pay the agent in accordance
  333  with sub-sub-sub-subparagraph (A).
  334         (II) If the corporation enters into a contractual agreement
  335  for a take-out plan, the producing agent of record of the
  336  corporation policy is entitled to retain any unearned commission
  337  on the policy, and the insurer shall:
  338         (A) Pay to the producing agent of record, for the first
  339  year, an amount that is the greater of the insurer’s usual and
  340  customary commission for the type of policy written or a fee
  341  equal to the usual and customary commission of the corporation;
  342  or
  343         (B) Offer to allow the producing agent of record to
  344  continue servicing the policy for at least 1 year and offer to
  345  pay the agent the greater of the insurer’s or the corporation’s
  346  usual and customary commission for the type of policy written.
  347  
  348  If the producing agent is unwilling or unable to accept
  349  appointment, the new insurer shall pay the agent in accordance
  350  with sub-sub-sub-subparagraph (A).
  351         c. For purposes of determining comparable coverage under
  352  sub-subparagraphs a. and b., the comparison must be based on
  353  those forms and coverages that are reasonably comparable. The
  354  corporation may rely on a determination of comparable coverage
  355  and premium made by the producing agent who submits the
  356  application to the corporation, made in the agent’s capacity as
  357  the corporation’s agent. A comparison may be made solely of the
  358  premium with respect to the main building or structure only on
  359  the following basis: the same coverage A or other building
  360  limits; the same percentage hurricane deductible that applies on
  361  an annual basis or that applies to each hurricane for commercial
  362  residential property; the same percentage of ordinance and law
  363  coverage, if the same limit is offered by both the corporation
  364  and the authorized insurer; the same mitigation credits, to the
  365  extent the same types of credits are offered both by the
  366  corporation and the authorized insurer; the same method for loss
  367  payment, such as replacement cost or actual cash value, if the
  368  same method is offered both by the corporation and the
  369  authorized insurer in accordance with underwriting rules; and
  370  any other form or coverage that is reasonably comparable as
  371  determined by the board. If an application is submitted to the
  372  corporation for wind-only coverage in the coastal account, the
  373  premium for the corporation’s wind-only policy plus the premium
  374  for the ex-wind policy that is offered by an authorized insurer
  375  to the applicant must be compared to the premium for multiperil
  376  coverage offered by an authorized insurer, subject to the
  377  standards for comparison specified in this subparagraph. If the
  378  corporation or the applicant requests from the authorized
  379  insurer a breakdown of the premium of the offer by types of
  380  coverage so that a comparison may be made by the corporation or
  381  its agent and the authorized insurer refuses or is unable to
  382  provide such information, the corporation may treat the offer as
  383  not being an offer of coverage from an authorized insurer at the
  384  insurer’s approved rate.
  385         6. Must include rules for classifications of risks and
  386  rates.
  387         7. Must provide that if premium and investment income for
  388  an account attributable to a particular calendar year are in
  389  excess of projected losses and expenses for the account
  390  attributable to that year, such excess shall be held in surplus
  391  in the account. Such surplus must be available to defray
  392  deficits in that account as to future years and used for that
  393  purpose before assessing assessable insurers and assessable
  394  insureds as to any calendar year.
  395         8. Must provide objective criteria and procedures to be
  396  uniformly applied to all applicants in determining whether an
  397  individual risk is so hazardous as to be uninsurable. In making
  398  this determination and in establishing the criteria and
  399  procedures, the following must be considered:
  400         a. Whether the likelihood of a loss for the individual risk
  401  is substantially higher than for other risks of the same class;
  402  and
  403         b. Whether the uncertainty associated with the individual
  404  risk is such that an appropriate premium cannot be determined.
  405  
  406  The acceptance or rejection of a risk by the corporation shall
  407  be construed as the private placement of insurance, and the
  408  provisions of chapter 120 does do not apply.
  409         9. Must provide that the corporation make its best efforts
  410  to procure catastrophe reinsurance at reasonable rates, to cover
  411  its projected 100-year probable maximum loss as determined by
  412  the board of governors.
  413         10. The policies issued by the corporation must provide
  414  that if the corporation or the market assistance plan obtains an
  415  offer from an authorized insurer to cover the risk at its
  416  approved rates, the risk is no longer eligible for renewal
  417  through the corporation, except as otherwise provided in this
  418  subsection.
  419         11. Corporation policies and applications must include a
  420  notice that the corporation policy could, under this section, be
  421  replaced with a policy issued by an authorized insurer which
  422  does not provide coverage identical to the coverage provided by
  423  the corporation. The notice must also specify that acceptance of
  424  corporation coverage creates a conclusive presumption that the
  425  applicant or policyholder is aware of this potential.
  426         12. May establish, subject to approval by the office,
  427  different eligibility requirements and operational procedures
  428  for any line or type of coverage for any specified county or
  429  area if the board determines that such changes are justified due
  430  to the voluntary market being sufficiently stable and
  431  competitive in such area or for such line or type of coverage
  432  and that consumers who, in good faith, are unable to obtain
  433  insurance through the voluntary market through ordinary methods
  434  continue to have access to coverage from the corporation. If
  435  coverage is sought in connection with a real property transfer,
  436  the requirements and procedures may not provide an effective
  437  date of coverage later than the date of the closing of the
  438  transfer as established by the transferor, the transferee, and,
  439  if applicable, the lender.
  440         13. Must provide that, with respect to the coastal account,
  441  any assessable insurer with a surplus as to policyholders of $25
  442  million or less writing 25 percent or more of its total
  443  countrywide property insurance premiums in this state may
  444  petition the office, within the first 90 days of each calendar
  445  year, to qualify as a limited apportionment company. A regular
  446  assessment levied by the corporation on a limited apportionment
  447  company for a deficit incurred by the corporation for the
  448  coastal account may be paid to the corporation on a monthly
  449  basis as the assessments are collected by the limited
  450  apportionment company from its insureds, but a limited
  451  apportionment company must begin collecting the regular
  452  assessments not later than 90 days after the regular assessments
  453  are levied by the corporation, and the regular assessments must
  454  be paid in full within 15 months after being levied by the
  455  corporation. A limited apportionment company shall collect from
  456  its policyholders any emergency assessment imposed under sub
  457  subparagraph (b)3.d. The plan must provide that, if the office
  458  determines that any regular assessment will result in an
  459  impairment of the surplus of a limited apportionment company,
  460  the office may direct that all or part of such assessment be
  461  deferred as provided in subparagraph (q)4. However, an emergency
  462  assessment to be collected from policyholders under sub
  463  subparagraph (b)3.d. may not be limited or deferred.
  464         14. Must provide that the corporation appoint as its
  465  licensed agents only those agents who throughout such
  466  appointments also hold an appointment as defined in s. 626.015
  467  by an insurer who is authorized to write and is actually writing
  468  or renewing personal lines residential property coverage,
  469  commercial residential property coverage, or commercial
  470  nonresidential property coverage within this the state.
  471         15. Must provide a premium payment plan option to its
  472  policyholders which, at a minimum, allows for quarterly and
  473  semiannual payment of premiums. A monthly payment plan may, but
  474  is not required to, be offered.
  475         16. Must limit coverage on mobile homes or manufactured
  476  homes built before 1994 to actual cash value of the dwelling
  477  rather than replacement costs of the dwelling.
  478         17. Must provide coverage for manufactured or mobile home
  479  dwellings. Such coverage must also include the following
  480  attached structures:
  481         a. Screened enclosures that are aluminum framed or screened
  482  enclosures that are not covered by the same or substantially the
  483  same materials as those of the primary dwelling;
  484         b. Carports that are aluminum or carports that are not
  485  covered by the same or substantially the same materials as those
  486  of the primary dwelling; and
  487         c. Patios that have a roof covering that is constructed of
  488  materials that are not the same or substantially the same
  489  materials as those of the primary dwelling.
  490  
  491  The corporation shall make available a policy for mobile homes
  492  or manufactured homes for a minimum insured value of at least
  493  $3,000.
  494         18. May provide such limits of coverage as the board
  495  determines, consistent with the requirements of this subsection.
  496         19. May require commercial property to meet specified
  497  hurricane mitigation construction features as a condition of
  498  eligibility for coverage.
  499         20. Must provide that new or renewal policies issued by the
  500  corporation on or after January 1, 2012, which cover sinkhole
  501  loss do not include coverage for any loss to appurtenant
  502  structures, driveways, sidewalks, decks, or patios that are
  503  directly or indirectly caused by sinkhole activity. The
  504  corporation shall exclude such coverage using a notice of
  505  coverage change, which may be included with the policy renewal,
  506  and not by issuance of a notice of nonrenewal of the excluded
  507  coverage upon renewal of the current policy.
  508         21. As of January 1, 2012, must require that the agent
  509  obtain from an applicant for coverage from the corporation an
  510  acknowledgment signed by the applicant, which includes, at a
  511  minimum, the following statement:
  512  
  513                ACKNOWLEDGMENT OF POTENTIAL SURCHARGE              
  514                      AND ASSESSMENT LIABILITY:                    
  515  
  516         1. AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE
  517  CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A
  518  DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON,
  519  MY POLICY COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND
  520  PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF THE
  521  POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH AS 45 PERCENT
  522  OF MY PREMIUM, OR A DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA
  523  LEGISLATURE.
  524         2. I UNDERSTAND THAT I CAN AVOID THE CITIZENS POLICYHOLDER
  525  SURCHARGE, WHICH COULD BE AS HIGH AS 45 PERCENT OF MY PREMIUM,
  526  BY OBTAINING COVERAGE FROM A PRIVATE MARKET INSURER AND THAT TO
  527  BE ELIGIBLE FOR COVERAGE BY CITIZENS, I MUST FIRST TRY TO OBTAIN
  528  PRIVATE MARKET COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE
  529  WITH CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES
  530  ARE REGULATED AND APPROVED BY THE STATE.
  531         3. I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY
  532  ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER
  533  INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE
  534  FLORIDA LEGISLATURE.
  535         4. I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE
  536  CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
  537  STATE OF FLORIDA.
  538  
  539         a. The corporation shall maintain, in electronic format or
  540  otherwise, a copy of the applicant’s signed acknowledgment and
  541  provide a copy of the statement to the policyholder as part of
  542  the first renewal after the effective date of this subparagraph.
  543         b. The signed acknowledgment form creates a conclusive
  544  presumption that the policyholder understood and accepted his or
  545  her potential surcharge and assessment liability as a
  546  policyholder of the corporation.
  547         22.The corporation shall pay a producing agent of record a
  548  reasonable commission not to exceed the average of commissions
  549  paid in the preceding year by the 20 admitted insurers writing
  550  the greatest market share of property insurance in this state.
  551         (n)1. Rates for coverage provided by the corporation must
  552  be actuarially sound and subject to s. 627.062, except as
  553  otherwise provided in this paragraph. The corporation shall file
  554  its recommended rates with the office at least annually. The
  555  corporation shall provide any additional information regarding
  556  the rates which the office requires. The office shall consider
  557  the recommendations of the board and issue a final order
  558  establishing the rates for the corporation within 45 days after
  559  the recommended rates are filed. The corporation may not pursue
  560  an administrative challenge or judicial review of the final
  561  order of the office.
  562         2. In addition to the rates otherwise determined pursuant
  563  to this paragraph, the corporation shall impose and collect an
  564  amount equal to the premium tax provided in s. 624.509 to
  565  augment the financial resources of the corporation.
  566         3. After The public hurricane loss-projection model under
  567  s. 627.06281, if has been found to be accurate and reliable by
  568  the Florida Commission on Hurricane Loss Projection Methodology,
  569  the model shall be considered when establishing the windstorm
  570  portion of the corporation’s rates. The corporation may use the
  571  public model results in combination with the results of private
  572  models to calculate rates for the windstorm portion of the
  573  corporation’s rates. This subparagraph does not require or allow
  574  the corporation to adopt rates lower than the rates otherwise
  575  required or allowed by this paragraph.
  576         4. The rate filings for the corporation which were approved
  577  by the office and took effect January 1, 2007, are rescinded,
  578  except for those rates that were lowered. As soon as possible,
  579  the corporation shall begin using the lower rates that were in
  580  effect on December 31, 2006, and provide refunds to
  581  policyholders who paid higher rates as a result of that rate
  582  filing. The rates in effect on December 31, 2006, remain in
  583  effect for the 2007 and 2008 calendar years except for any rate
  584  change that results in a lower rate. The next rate change that
  585  may increase rates shall take effect pursuant to a new rate
  586  filing recommended by the corporation and established by the
  587  office, subject to this paragraph.
  588         5. Beginning on July 15, 2009, and annually thereafter, the
  589  corporation must make a recommended actuarially sound rate
  590  filing for each personal and commercial line of business it
  591  writes, to be effective no earlier than January 1, 2010.
  592         6. Beginning on or after January 1, 2022 January 1, 2010,
  593  and notwithstanding the board’s recommended rates and the
  594  office’s final order regarding the corporation’s filed rates
  595  under subparagraph 1., the corporation shall annually implement
  596  a rate increase which, except for sinkhole coverage, does not
  597  exceed 10 percent for any single policy renewed issued by the
  598  corporation covering a personal residential property that is
  599  used as the primary residence of the insured which has a
  600  dwelling replacement cost less than $700,000 or that is a single
  601  condominium unit that has a combined dwelling and contents
  602  replacement cost less than $700,000, excluding coverage changes
  603  and surcharges, if the policy was initially issued by the
  604  corporation before January 1, 2022.
  605  
  606  ================= T I T L E  A M E N D M E N T ================
  607  And the title is amended as follows:
  608         Delete lines 7 - 8
  609  and insert:
  610         certain circumstances; defining the term “primary
  611         residence”; revising