Florida Senate - 2022                          SENATOR AMENDMENT
       Bill No. SB 2-A
       
       
       
       
       
       
                                Ì619600wÎ619600                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
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                Floor: 11/F/2R         .                                
             12/13/2022 03:07 PM       .                                
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       Senator Polsky moved the following:
       
       
    1         Senate Amendment (with title amendment)
    2  
    3  
    4         Between lines 2607 and 2608
    5  insert:
    6         Section 17. Section 627.7015, Florida Statutes, is amended
    7  to read:
    8         627.7015 Mandatory mediation Alternative procedure for
    9  resolution of disputed property insurance claims.—
   10         (1) This section sets forth a nonadversarial alternative
   11  dispute resolution procedure for a mediated claim resolution
   12  conference prompted by the need for effective, fair, and timely
   13  handling of property insurance claims. There is a particular
   14  need for an informal, nonthreatening forum for helping parties
   15  who elect this procedure to resolve their claims disputes
   16  because most homeowner and commercial residential insurance
   17  policies obligate policyholders to participate in a potentially
   18  expensive and time-consuming adversarial appraisal process
   19  before litigation. The procedure set forth in this section is
   20  designed to bring the parties together for a mediated claims
   21  settlement conference without any of the trappings or drawbacks
   22  of an adversarial process. Before resorting to these procedures,
   23  policyholders and insurers are encouraged to resolve claims as
   24  quickly and fairly as possible. This section applies is
   25  available with respect to claims under personal lines and
   26  commercial residential policies before commencing the appraisal
   27  process, or before commencing litigation. Mediation may be
   28  requested only by the policyholder, as a first-party claimant, a
   29  third-party, as an assignee of the policy benefits, or the
   30  insurer. However, an insurer is not required to participate in
   31  any mediation requested by a third-party assignee of the policy
   32  benefits. If requested by the policyholder, Participation by
   33  legal counsel is permitted. Mediation under this section is also
   34  required of available to litigants referred to the department by
   35  a county court or circuit court. This section does not apply to
   36  commercial coverages, to private passenger motor vehicle
   37  insurance coverages, or to disputes relating to liability
   38  coverages in policies of property insurance.
   39         (2) At the time of issuance and renewal of a policy or at
   40  the time a first-party claim within the scope of this section is
   41  filed by the policyholder, the insurer shall notify the
   42  policyholder of its right to participate in the mandatory
   43  mediation program under this section. The department shall
   44  prepare a consumer information pamphlet for distribution to
   45  persons participating in mediation.
   46         (3) If the parties mutually agree, mediation may be
   47  conducted by teleconference or by telephone in lieu of appearing
   48  in person. The costs of mediation must be reasonable, and the
   49  insurer must bear all of the cost of conducting mediation
   50  conferences, except as otherwise provided in this section. If a
   51  policyholder fails to appear at the conference, the conference
   52  must be rescheduled upon the policyholder’s payment of the costs
   53  of a rescheduled conference. If the insurer fails to appear at
   54  the conference, the insurer must pay the policyholder’s actual
   55  cash expenses incurred in attending the conference if the
   56  insurer’s failure to attend was not due to a good cause
   57  acceptable to the department. An insurer will be deemed to have
   58  failed to appear if the insurer’s representative lacks authority
   59  to settle the full value of the claim. The insurer shall incur
   60  an additional fee for a rescheduled conference necessitated by
   61  the insurer’s failure to appear at a scheduled conference. The
   62  fees assessed by the administrator must include a charge
   63  necessary to defray the expenses of the department related to
   64  its duties under this section and must be deposited in the
   65  Insurance Regulatory Trust Fund.
   66         (4) The department shall adopt by rule a property insurance
   67  mediation program to be administered by the department or its
   68  designee. The department shall may also adopt special rules
   69  which are applicable in cases of an emergency within the state,
   70  including emergency rules as necessary to establish physical
   71  addresses for the mediation program in areas affected by natural
   72  disasters. The rules shall be modeled after practices and
   73  procedures set forth in mediation rules of procedure adopted by
   74  the Supreme Court. The rules shall provide for:
   75         (a) Reasonable requirement for processing and scheduling of
   76  requests for mediation.
   77         (b) Qualifications, denial of application, suspension,
   78  revocation of approval, and other penalties for mediators as
   79  provided in s. 627.745 and the Florida Rules for Certified and
   80  Court-Appointed Mediators.
   81         (c) Provisions governing who may attend mediation
   82  conferences.
   83         (d) Selection of mediators.
   84         (e) Criteria for the conduct of mediation conferences.
   85         (f) Right to legal counsel.
   86         (5) All statements made and documents produced at a
   87  mediation conference shall be deemed to be settlement
   88  negotiations in anticipation of litigation within the scope of
   89  s. 90.408. All parties to the mediation must negotiate in good
   90  faith and must have the authority to immediately settle the
   91  claim. Mediators are deemed to be agents of the department and
   92  shall have the immunity from suit provided in s. 44.107.
   93         (6)(a) Mediation is nonbinding; however, if a written
   94  settlement is reached, the policyholder has 3 business days
   95  within which the policyholder may rescind the settlement unless
   96  the policyholder has cashed or deposited any check or draft
   97  disbursed to the policyholder for the disputed matters as a
   98  result of the conference. If a settlement agreement is reached
   99  and is not rescinded, it is binding and acts as a release of all
  100  specific claims that were presented in that mediation
  101  conference.
  102         (b) At the conclusion of the mediation, the mediator shall
  103  provide a written report of the results of mediation, including
  104  any settlement amount, to the insurer, the policyholder, and the
  105  policyholder’s representative if the policyholder is represented
  106  at the mediation.
  107         (7) If the insurer fails to comply with subsection (2) by
  108  failing to notify a policyholder of its right to participate in
  109  the mediation program under this section or if the insurer
  110  requests the mediation, and the mediation results are rejected
  111  by either party, the policyholder is not required to submit to
  112  or participate in any contractual loss appraisal process of the
  113  property loss damage as a precondition to legal action for
  114  breach of contract against the insurer for its failure to pay
  115  the policyholder’s claims covered by the policy.
  116         (8) The department may designate an entity or person to
  117  serve as administrator to carry out any of the provisions of
  118  this section and may take this action by means of a written
  119  contract or agreement.
  120         (9) For purposes of this section, the term “claim” refers
  121  to any dispute between an insurer and a policyholder relating to
  122  a material issue of fact other than a dispute:
  123         (a) With respect to which the insurer has a reasonable
  124  basis to suspect fraud;
  125         (b) When, based on agreed-upon facts as to the cause of
  126  loss, there is no coverage under the policy;
  127         (c) With respect to which the insurer has a reasonable
  128  basis to believe that the policyholder has intentionally made a
  129  material misrepresentation of fact which is relevant to the
  130  claim, and the entire request for payment of a loss has been
  131  denied on the basis of the material misrepresentation;
  132         (d) With respect to which the amount in controversy is less
  133  than $500, unless the parties agree to mediate a dispute
  134  involving a lesser amount; or
  135         (e) With respect to a loss that does not comply with s.
  136  627.70132.
  137         Section 18. For the 2022-2023 fiscal year, the sum of $1
  138  million in recurring funds is appropriated from the Insurance
  139  Regulatory Trust Fund to the Department of Financial Services
  140  for the purpose of administering the amendment made by this act
  141  to s. 627.7015, Florida Statutes.
  142  
  143  ================= T I T L E  A M E N D M E N T ================
  144  And the title is amended as follows:
  145         Delete line 119
  146  and insert:
  147         barred; amending s. 627.7015, F.S.; requiring, rather
  148         than authorizing, parties to a property insurance
  149         claims dispute to participate in mediation; providing
  150         that the parties may mutually agree to conduct the
  151         mediation by teleconference or by telephone;
  152         requiring, rather than authorizing, the Department of
  153         Financial Services to adopt certain rules; authorizing
  154         the department to adopt certain emergency rules;
  155         providing an appropriation; amending s. 627.70152,
  156         F.S.; revising