Senate Bill 0994c1
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Florida Senate - 1998 CS for SB 994
By the Committee on Banking and Insurance and Senator Grant
311-2048-98
1 A bill to be entitled
2 An act relating to insurance; amending s.
3 624.316, F.S.; deleting certain rulemaking
4 authority of the Department of Insurance
5 relating to insurer compliance; amending s.
6 627.7275, F.S.; modifying coverage requirements
7 and premiums relating to motor vehicle property
8 damage liability; amending s. 624.426, F.S.;
9 providing that certain transferred policies are
10 exempt from the resident agent and
11 countersignature law; amending s. 627.9126,
12 F.S.; deleting the requirement that the
13 Department of Insurance conduct an annual
14 sampling of certain claims information required
15 to be maintained by liability insurers;
16 amending s. 627.913, F.S.; deleting the
17 requirement that insurers file product
18 liability insurance reports; authorizing the
19 department to require such reports upon
20 request; providing an effective date.
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22 Be It Enacted by the Legislature of the State of Florida:
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24 Section 1. Paragraph (f) of subsection (2) of section
25 624.316, Florida Statutes, is amended to read:
26 624.316 Examination of insurers.--
27 (2)
28 (f)1.a. An examination under this section must be
29 conducted at least once every year with respect to a domestic
30 insurer that has continuously held a certificate of authority
31 for less than 3 years. The examination must cover the
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Florida Senate - 1998 CS for SB 994
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1 preceding fiscal year or the period since the last examination
2 of the insurer. The department may limit the scope of the
3 examination if the insurer has demonstrated sufficient
4 compliance as determined under subparagraph 3.
5 b. The department may not accept an independent
6 certified public accountant's audit report in lieu of an
7 examination required by this subparagraph.
8 c. An insurer may not be required to pay more than
9 $25,000 to cover the costs of any one examination under this
10 subparagraph.
11 2. An examination under this section must be conducted
12 not less frequently than once every 5 years with respect to an
13 insurer that has continuously held a certificate of authority,
14 without a change in ownership subject to s. 624.4245 or s.
15 628.461, for more than 15 years and has demonstrated
16 sufficient compliance as determined under subparagraph 3. The
17 examination must cover the preceding 5 fiscal years of the
18 insurer or the period since the last examination of the
19 insurer. This subparagraph does not limit the ability of the
20 department to conduct more frequent examinations.
21 3. The department must, by rule, adopt procedures and
22 criteria for determining if an insurer has demonstrated
23 sufficient compliance with this code and cooperation with the
24 department. The rules must include consideration of such
25 factors as financial strength, timeliness, consumer service,
26 economic and community contributions and support,
27 responsiveness to department requests, and any other relevant
28 factors. The department must annually publish and disseminate
29 a listing of those insurers found to demonstrate sufficient
30 compliance under the rules, including special recognition for
31 community contributions and support.
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Florida Senate - 1998 CS for SB 994
311-2048-98
1 Section 2. Paragraph (a) of subsection (2) of section
2 627.7275, Florida Statutes, is amended to read:
3 627.7275 Motor vehicle property damage liability.--
4 (2)(a) Insurers writing motor vehicle insurance in
5 this state shall make available, subject to the insurers'
6 usual underwriting restrictions, coverage under policies as
7 described in subsection (1) of this section to any applicant
8 for private passenger motor vehicle insurance coverage who is
9 seeking the coverage in order to reinstate the applicant's
10 driving privileges in this state when the driving privileges
11 were revoked or suspended pursuant to s. 316.646 or s. 627.733
12 due to the failure of the applicant to maintain required
13 security. The policy shall be issued for a period of at least
14 6 months and as to the minimum coverages required under this
15 section shall not be cancelable by the insured for any reason
16 or by the insurer after a period not to exceed 30 days during
17 which the insurer must complete underwriting of the policy.
18 After the insurer has completed underwriting the policy within
19 the 30-day period, the insurer shall notify the Department of
20 Highway Safety and Motor Vehicles that the policy is in full
21 force and effect and the policy shall not be cancelable for
22 the remainder of the policy period. A premium shall be
23 collected and coverage shall be in effect for the 30-day
24 period during which the insurer is completing the underwriting
25 of the policy whether or not the person's driver license,
26 motor vehicle tag, and motor vehicle registration are in
27 effect. Once the noncancelable provisions of the policy
28 become effective, the coverage or risk shall not be changed
29 during the policy period and the premium shall be
30 nonrefundable fully earned. If, during the pendency of the
31 2-year proof of insurance period required under s. 627.733(7),
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Florida Senate - 1998 CS for SB 994
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1 the insured obtains additional coverage or coverage for an
2 additional risk or changes territories, the insured then she
3 or he must obtain a new 6-month noncancelable policy in
4 accordance with the provisions of this section. However, if
5 the insured must obtain a new 6-month policy and obtains the
6 policy from the same insurer, the policyholder shall receive
7 credit on the new policy for any premium paid on the
8 previously issued policy.
9 Section 3. Subsection (4) is added to s. 624.426,
10 Florida Statutes, to read:
11 624.426 Exceptions to resident agent and
12 countersignature law.--Section 624.425 does not apply to:
13 (4) Policies of insurance issued by insurers whose
14 agents represent only one company or group of companies under
15 common ownership if a company within one group is transferring
16 policies to another company within the same group and the
17 agent of record remains the same.
18 Section 4. Subsection (1) of section 627.9126, Florida
19 Statutes, is amended to read:
20 627.9126 Annual reports of information by liability
21 insurers required.--
22 (1) Each insurer transacting commercial multiperil,
23 products liability, commercial automobile liability, private
24 passenger automobile liability, or other line of liability
25 insurance shall maintain information as specified in this
26 section. Such information shall be maintained for each line of
27 insurance and for direct Florida business only. The department
28 may shall annually conduct a sampling of claims or actions for
29 damages for personal injury or property damage claimed to have
30 been caused by error, omission, or negligence of insureds if
31 the claim resulted in:
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Florida Senate - 1998 CS for SB 994
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1 (a) A final judgment in any amount.
2 (b) A settlement in any amount.
3 (c) A final disposition not resulting in payment on
4 behalf of the insured.
5 Section 5. Section 627.913, Florida Statutes, is
6 amended to read:
7 627.913 Reports of information by products liability
8 insurers required.--
9 (1) The department may require any insurer authorized
10 to write a policy of products liability insurance in the state
11 to shall transmit the following information specified in this
12 section, based on its statewide products liability insurance
13 writings. Upon request of the department, an insurer shall,
14 within 60 days, submit to the department a report that
15 contains the following information, to the department each
16 year in the annual report of such insurer:
17 (1)(a) Premiums written;
18 (2)(b) Premiums earned;
19 (3)(c) Unearned premiums;
20 (4)(d) The dollar amount of claims paid;
21 (5)(e) Incurred claims, not including claims incurred
22 but not reported;
23 (6)(f) Claims closed without payment, and the amount
24 reserved for such claims;
25 (7)(g) Loss reserves for all claims except claims
26 incurred but not reported;
27 (8)(h) Reserves for claims incurred but not reported;
28 (9)(i) Losses paid as a percentage of the amount
29 reserved for such losses;
30 (10)(j) Net investment gain or loss and other income
31 gain or loss allocated to products liability lines according
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Florida Senate - 1998 CS for SB 994
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1 to the allocation formula used in the annual insurance expense
2 exhibit;
3 (11)(k) Underwriting income or loss;
4 (12)(l) Actual expenses in detail, including, but not
5 limited to, loss adjustment expense; commissions; general
6 expense; and advertising, home office, and defense costs;
7 (13)(m) Claims settled after a suit was filed;
8 (14)(n) Claims paid based on a judgment; and
9 (15)(o) Judgments appealed by the insurer, together
10 with the total results of such appeals.
11 (2) The department shall provide a summary of
12 information provided pursuant to subsection (1) in its annual
13 report.
14 (3) In the first year that an insurer makes a report
15 pursuant to subsection (1), the insurer shall provide only the
16 information required by paragraphs (a) through (l) of
17 subsection (1) and shall provide such information for the
18 current year and the 3 previous years.
19 Section 6. This act shall take effect October 1, 1998.
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Florida Senate - 1998 CS for SB 994
311-2048-98
1 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
COMMITTEE SUBSTITUTE FOR
2 Senate Bill 994
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4 Removes the provision that civil remedy notices are not
complaints for purposes of records retention by insurers.
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Deletes the provision that an insurer's independent medical
6 examination (IME) pursuant to a disputed personal injury
protection (PIP) claim be conducted in a location reasonably
7 accessible to the insured.
8 Removes the repeal of PIP (personal injury protection)
provision relating to how medical payments insurance benefits
9 must be determined.
10 Removes the provision that an insurer place the entire amount
of insurance coverage into a court registry when there are
11 multiple claimants.
12 Deletes the countersignature requirement by the agent of
record when an insurance policy is transferred from one
13 company in an insurance company group to another in the same
group.
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Provides that the Department of Insurance may, rather than
15 shall, annually require that an insurer report certain
information relating to product liability insurance.
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