Senate Bill 0822c1

    Florida Senate - 2000                            CS for SB 822

    By the Committee on Banking and Insurance; and Senator Webster





    311-841-00

  1                      A bill to be entitled

  2         An act relating to premium security deposits;

  3         creating s. 627.4045, F.S.; authorizing

  4         insurers to accept and hold premium security

  5         deposits for certain purposes; authorizing an

  6         insurer to pay interest on such deposits;

  7         specifying conditions under which such deposits

  8         are considered premium; providing that such

  9         deposits are considered unearned premium for

10         certain purposes; providing an effective date.

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12  Be It Enacted by the Legislature of the State of Florida:

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14         Section 1.  Section 627.4045, Florida Statutes, is

15  created to read:

16         627.4045  Premium security deposits.--

17         (1)  An insurer may accept and hold a premium security

18  deposit made by an insured. As used in this section, the term

19  "premium security deposit" means moneys that are deposited

20  with an insurer to secure payment of premium under an

21  insurance contract or agreement to provide commercial property

22  and casualty insurance, including workers' compensation and

23  employers' liability coverage.

24         (2)  An insurer may pay interest to an insured on a

25  premium security deposit. The interest may be a fixed or

26  variable amount or may be expressed as a fixed or variable

27  rate.

28         (3)  For purposes of s. 624.509, a premium security

29  deposit is not to be considered as premium received until the

30  deposit is used by an insurer to pay any earned premium

31  obligation of the insured.

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






    Florida Senate - 2000                            CS for SB 822
    311-841-00




  1         (4)  Any premium security deposit given to an insurer

  2  by an insured is considered an unearned premium for purposes

  3  of parts II and V of chapter 631.

  4         Section 2.  This act shall take effect upon becoming a

  5  law.

  6

  7          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  8                         Senate Bill 822

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10  The committee substitute provides that a premium security
    deposit is considered, for purposes of ch. 631, F.S., an
11  "unearned premium," instead of a "covered claim," for purposes
    of prioritization and recovery of the claim, in the event an
12  insurer becomes insolvent.

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