Skip to Navigation | Skip to Main Content | Skip to Site Map

MyFloridaHouse.gov | Mobile Site

Senate Tracker: Sign Up | Login

The Florida Senate

2014 Florida Statutes

Title XXXVII INSURANCE
Chapter 631 INSURER INSOLVENCY; GUARANTY OF PAYMENT Entire Chapter
SECTION 718
Assessments.
F.S. 631.718
631.718 Assessments.—
(1) For the purpose of providing the funds necessary to carry out the powers and duties of the association, the board of directors shall assess the member insurers separately, for each of the accounts referred to in s. 631.715 at such time and for such amounts as the board finds necessary. Assessments shall be due not less than 30 days after written notice to the member insurers.
(2) There shall be two classes of assessments, as follows:
(a) Class A assessments shall be made by the board of directors for the purpose of meeting administrative costs and other general expenses and for examinations conducted under the authority of s. 631.723(3) which are not related to a particular impaired or insolvent insurer.
(b) Class B assessments shall be made by the board of directors for the purpose of carrying out the powers and duties of the association under s. 631.717 relating to an impaired or insolvent domestic, foreign, or alien insurer.
(3)(a) The amount of any Class A assessment shall be determined by the board and may be made on a non-pro rata basis. The assessment may not be credited against future insolvency assessments and may not exceed $250 per member insurer in any one calendar year.
(b) The amount of any Class B assessment shall be allocated for assessment purposes among the accounts pursuant to an allocation formula, which may be based on the premiums or reserves of the impaired or insolvent insurer.
(c) Class B assessments against member insurers for each account must be based upon the premiums received on business in this state by each assessed member insurer on policies or contracts covered by each account for the 3 most recent calendar years for which information is available preceding the year of the assessment in proportion to premiums received on business in this state for those calendar years by all assessed member insurers. If the most recent 3 years of premium information is not available for each member insurer, the board of directors may use the premium information that is reasonably available.
(d) Assessments for funds to meet the requirements of the association with respect to an impaired or insolvent insurer may not be made until necessary to implement the purposes of this part.
(e) Classification of assessments under subsection (2) and computation of assessments under this subsection must be made with a reasonable degree of accuracy, recognizing that exact determinations are not always possible.
(4) The association may abate or defer, in whole or in part, the assessment of a member insurer if, in the opinion of the board, payment of the assessment would endanger the ability of the member insurer to fulfill its contractual obligations. In the event an assessment against a member insurer is abated, or deferred in whole or in part, the amount by which such assessment is abated or deferred may be assessed against the other member insurers in a manner consistent with the basis for assessments set forth in this section.
(5)(a) The total of all assessments upon a member insurer for each account may not in any one calendar year exceed 1 percent of the sum of the insurer’s premiums written in this state regarding business covered by the account received during the 3 calendar years preceding the year in which the assessment is made, divided by three. If premium information for the 3-year period is not reasonably available for each member insurer, the association may use any reasonably available premium information.
(b) The provisions of this subsection apply to any assessments made on or after October 1, 1995, without regard to the date of the impairment or insolvency.
(c) If the maximum assessment, together with the other assets of the association in its nonadministrative accounts, does not provide in any one year in any account an amount sufficient to carry out the responsibilities of the association, the necessary additional funds must be assessed as soon thereafter as permitted by this part.
(6) The board may, by an equitable method as established in the plan of operation, refund to member insurers, in proportion to the contribution of each insurer to an account, the amount by which the assets of such account exceed the amount the board finds is necessary to carry out during the coming year the obligations of the association with regard to that account, including assets accruing from net realized gains and income from investments. A reasonable amount may be retained in any account to provide funds for the continuing expenses of the association and for future losses if refunds are impractical.
(7) It shall be proper for any member insurer, in determining its premium rates and policyowner dividends as to any kind of insurance within the scope of this part, to consider the amount reasonably necessary to meet its assessment obligations under this part.
(8) The association shall issue to each insurer paying an assessment under this part, other than a Class A assessment, a certificate of contribution, in a form prescribed by the department, for the amount of the assessment so paid. All outstanding certificates are of equal dignity and priority without reference to amounts or dates of issue. A certificate of contribution may be shown by the insurer in its financial statement as an asset in such form and for such amount, if any, and period of time as the department approves. However, any amount offset pursuant to s. 631.72 may not be shown as an asset of the insurer on any of its financial statements.
(9) Notwithstanding any provision to the contrary, no member insurer that is a nonprofit insurance company which issues annuity contracts or group annuity contracts pursuant to s. 121.35, or for the benefit of employees of educational institutions situated in this state may be assessed in any one calendar year an amount greater than the amount which it paid to this state in the previous year as premium tax and corporate tax on the business to which this part applies or 0.1 percent of written premium on such business in this state, whichever is greater.
History.—s. 8, ch. 79-189; s. 434, ch. 81-259; s. 809(1st), ch. 82-243; s. 35, ch. 83-38; s. 16, ch. 89-360; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 13, ch. 92-328; s. 6, ch. 93-149; s. 5, ch. 95-213; s. 2, ch. 96-346; s. 68, ch. 2001-63.