Senate Bill sb2234
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Florida Senate - 2001 SB 2234
By Senator Garcia
39-1236-01
1 A bill to be entitled
2 An act relating to insurance; amending s.
3 627.351, F.S.; renaming the Residential
4 Property and Casualty Joint Underwriting
5 Association as the Citizens Property Insurance
6 Corporation to provide residential and
7 commercial property insurance through a public
8 benefits corporation; requiring insurers
9 writing property insurance to participate in
10 the corporation; providing for dividing the
11 revenues, assets, liabilities, losses, and
12 expenses of the corporation into three
13 accounts; providing for emergency assessments
14 for policyholders of participating insurers;
15 providing a plan of operation; providing for a
16 board of governors; providing that the
17 corporation is not required to obtain a
18 certificate of authority from the Department of
19 Insurance; providing that the corporation is
20 not required to be a member of the Florida
21 Insurance Guaranty Association; requiring the
22 corporation to pay assessments pledged by the
23 association to secure bonds to pay covered
24 claims arising from insurer insolvencies caused
25 by hurricane losses; providing for transfer of
26 policies of the association and the Florida
27 Windstorm Underwriting Association to the
28 corporation; providing for a transfer of assets
29 and liabilities; requiring the associations to
30 take actions necessary to further such
31 transfers; providing that such transfers do not
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1 affect the coverage of "covered policies;"
2 providing for the redesignation of certain
3 coverage as the high-risk account of the
4 corporation; providing that such account be
5 treated as if it were a separate participating
6 insurer for certain purposes; providing that
7 the personal lines and commercial lines
8 accounts be treated as a single participating
9 insurer for certain purposes; providing that
10 the department may postpone the October 1,
11 2001, effective date of transfer under the act;
12 providing legislative intent not to interfere
13 with the rights of creditors, to preserve the
14 obligation of the association, and to assure
15 that outstanding financing agreements pass
16 unchanged to the corporation; providing an
17 effective date.
18
19 Be It Enacted by the Legislature of the State of Florida:
20
21 Section 1. Subsection (6) of section 627.351, Florida
22 Statutes, is amended to read:
23 627.351 Insurance risk apportionment plans.--
24 (6) CITIZENS RESIDENTIAL PROPERTY INSURANCE
25 CORPORATION AND CASUALTY JOINT UNDERWRITING ASSOCIATION.--
26 (a)1. The Legislature finds that actual and threatened
27 catastrophic losses to property in this state from hurricanes
28 have caused insurers to be unwilling or unable to provide
29 property insurance coverage to the extent sought and needed.
30 It is in the public interest and a public purpose to assist in
31 assuring that property in the state is insured so as to
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1 facilitate the remediation, reconstruction, and replacement of
2 damaged or destroyed property in order to reduce or avoid the
3 negative effects otherwise resulting to the public health,
4 safety, and welfare; to the economy of the state; and to the
5 revenues of the state and local governments needed to provide
6 for the public welfare. It is necessary, therefore, to provide
7 property insurance to applicants who are in good faith
8 entitled to procure insurance through the voluntary market but
9 are unable to do so. The Legislature intends by this
10 subsection that such insurance be provided and continues, as
11 long as necessary, through a public-benefits corporation which
12 is organized to achieve efficiencies and economies, all toward
13 the achievement of the foregoing public purposes.
14 2. The Residential Property and Casualty Joint
15 Underwriting Association originally created by this statute
16 shall be known, as of October 1, 2001, as the Citizens
17 Property Insurance Corporation. The Corporation shall operate
18 as
19 (a) There is created a public benefits corporation
20 joint underwriting association for insuring residential and
21 commercial equitable apportionment or sharing among insurers
22 of property and casualty insurance covering residential
23 property, for applicants who are in good faith entitled, but
24 are unable, to procure insurance through the voluntary market.
25 The corporation association shall operate pursuant to a plan
26 of operation approved by order of the department. The plan is
27 subject to continuous review by the department. The department
28 may, by order, withdraw approval of all or part of a plan if
29 the department determines that conditions have changed since
30 approval was granted and that the purposes of the plan require
31 changes in the plan. For the purposes of this subsection,
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1 residential coverage includes both personal lines residential
2 coverage, which consists of the type of coverage provided by
3 homeowner's, mobile home owner's, dwelling, tenant's,
4 condominium unit owner's, and similar policies, and commercial
5 lines residential coverage, which consists of the type of
6 coverage provided by condominium association, apartment
7 building, and similar policies.
8 (b)1. All insurers authorized to write one or more
9 subject lines of business in this state and insurers writing
10 one or more subject lines of business pursuant to part VIII of
11 chapter 626, other than underwriting associations or other
12 entities created under this section, must participate in and
13 be members of the corporation, collectively referred to as
14 "participating insurers" Residential Property and Casualty
15 Joint Underwriting Association. An authorized insurer's A
16 member's participation shall begin on the first day of the
17 calendar year following the year in which the insurer member
18 was issued a certificate of authority to transact insurance
19 for subject lines of business in this state and shall
20 terminate 1 year after the end of the first calendar year
21 during which the insurer member no longer holds a certificate
22 of authority to transact insurance for subject lines of
23 business in this state. For insurers transacting insurance for
24 subject lines of business in this state pursuant to part VIII
25 of chapter 626, the insurer's participating shall begin on the
26 first day of the calendar year following the year in which the
27 insurer began transacting insurance for subject lines of
28 business in this state and shall terminate 1 year after the
29 corporation no longer has any liabilities in this state for
30 the subject lines of business.
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1 2.a. All revenues, assets, liabilities, losses, and
2 expenses of the corporation association shall be divided into
3 three two separate accounts, as follows:
4 (I) A personal lines account for personal residential
5 policies issued by the corporation or issued by the
6 Residential Property and Casualty Joint Underwriting
7 Association and renewed by the corporation on risks which are
8 not located in areas eligible for coverage in the Florida
9 Windstorm Underwriting Association as those areas were defined
10 on January 1, 2001;
11 (II) A commercial lines account for commercial
12 residential policies issued by the corporation or issued by
13 the Residential Property and Casualty Joint Underwriting
14 Association and renewed by the corporation on risks which are
15 not located in areas eligible for coverage in the Florida
16 Windstorm Underwriting Association as those areas were defined
17 on January 1, 2001; and
18 (III) A high-risk account for personal residential
19 policies and commercial residential and commercial
20 nonresidential property policies issued by the corporation or
21 transferred to the corporation on risks which are located in
22 areas eligible for coverage in the Florida Windstorm
23 Underwriting Association as those areas were defined on
24 January 1, 2001. one of which is for personal lines
25 residential coverages and the other of which is for commercial
26 lines residential coverages.
27 b. Revenues, assets, liabilities, losses, and expenses
28 not attributable to particular coverages shall be prorated
29 among between the accounts.
30 3. With respect to a deficit in an account:
31
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1 a. When the deficit incurred in a particular calendar
2 year is not greater than 10 percent of the aggregate statewide
3 direct written premium for the subject lines of business for
4 the prior calendar year for all participating member insurers,
5 the entire deficit shall be recovered through assessments of
6 participating member insurers under paragraph (g).
7 b. When the deficit incurred in a particular calendar
8 year exceeds 10 percent of the aggregate statewide direct
9 written premium for the subject lines of business for the
10 prior calendar year for all participating member insurers, the
11 corporation association shall levy an assessment on
12 participating member insurers in an amount equal to the
13 greater of 10 percent of the deficit or 10 percent of the
14 aggregate statewide direct written premium for the subject
15 lines of business for the prior calendar year for all member
16 insurers. Any remaining deficit shall be recovered through
17 emergency assessments under sub-subparagraph d.
18 c. Each participating member insurer's share of the
19 total assessment under sub-subparagraph a. or sub-subparagraph
20 b. shall be in the proportion that the participating member
21 insurer's direct written premium for the subject lines of
22 business for the year preceding the assessment bears to the
23 aggregate statewide direct written premium for the subject
24 lines of business for that year for all participating member
25 insurers.
26 d. Upon a determination by the board of governors that
27 a deficit in an account exceeds the amount that will be
28 recovered through regular assessments on participating member
29 insurers under sub-subparagraph a. or sub-subparagraph b., the
30 board shall levy, after verification by the department,
31 emergency assessments to be collected by participating member
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1 insurers and the corporation by underwriting associations
2 created under this section which write subject lines of
3 business upon issuance or renewal of policies for subject
4 lines of business, excluding National Flood Insurance
5 policies, in the year or years following levy of the regular
6 assessments. The amount of the emergency assessment collected
7 in a particular year shall be a uniform percentage of that
8 year's direct written premium for subject lines of business
9 for all participating member insurers and all accounts of the
10 corporation underwriting associations, excluding National
11 Flood Insurance Program policy premiums, as annually
12 determined by the board and verified by the department. The
13 department shall verify the arithmetic calculations involved
14 in the board's determination within 30 days after receipt of
15 the information on which the determination was based.
16 Notwithstanding any other provision of law, each participating
17 member insurer that and each underwriting association created
18 under this section which writes subject lines of business and
19 the corporation shall collect emergency assessments from its
20 policyholders without such obligation being affected by any
21 credit, limitation, exemption, or deferment. The emergency
22 assessments so collected shall be transferred directly to the
23 corporation association on a periodic basis as determined by
24 the corporation association. The aggregate amount of emergency
25 assessments levied under this sub-subparagraph in any calendar
26 year may not exceed the greater of 10 percent of the amount
27 needed to cover the original deficit, plus interest, fees,
28 commissions, required reserves, and other costs associated
29 with financing of the original deficit, or 10 percent of the
30 aggregate statewide direct written premium for subject lines
31 of business written by participating member insurers and for
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1 all accounts of the corporation underwriting associations for
2 the prior year, plus interest, fees, commissions, required
3 reserves, and other costs associated with financing the
4 original deficit. For participating insurers writing one or
5 more subject lines of business pursuant to part VIII of
6 chapter 626, the Florida Surplus Lines Service Office shall
7 verify and collect emergency assessments for policyholders of
8 such insurers and remit as instructed by the corporation. The
9 Florida Surplus Lines Service Office shall also require
10 insurers transacting business in this state pursuant to part
11 VIII of chapter 626 to identify those premiums which are
12 attributable to the subject lines of business.
13 e. The board may pledge the proceeds of assessments,
14 projected recoveries from the Florida Hurricane Catastrophe
15 Fund, other insurance and reinsurance recoverables, market
16 equalization surcharges and other surcharges, and other funds
17 available to the corporation association as the source of
18 revenue for and to secure bonds issued under paragraph (g),
19 bonds or other indebtedness issued under subparagraph (c)2.
20 (c)3., or lines of credit or other financing mechanisms issued
21 or created under this subsection, or to retire any other debt
22 incurred as a result of deficits or events giving rise to
23 deficits, or in any other way that the board determines will
24 efficiently recover such deficits. The purpose of the lines of
25 credit or other financing mechanisms is to provide additional
26 resources to assist the corporation association in covering
27 claims and expenses attributable to a catastrophe. As used in
28 this subsection, the term "assessments" includes regular
29 assessments under sub-subparagraph a., sub-subparagraph b., or
30 subparagraph (g)1. and emergency assessments under
31 sub-subparagraph d. Emergency assessments collected under
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1 sub-subparagraph d. are not part of an insurer's rates, are
2 not premium, and are not subject to premium tax, fees, or
3 commissions; however, failure to pay the emergency assessment
4 shall be treated as failure to pay premium. The emergency
5 assessments under sub-subparagraph d. shall continue as long
6 as any bonds issued or other indebtedness incurred with
7 respect to a deficit for which the assessment was imposed
8 remain outstanding, unless adequate provision has been made
9 for the payment of such bonds or other indebtedness pursuant
10 to the documents governing such bonds or other indebtedness.
11 f. As used in this subsection, the term "subject lines
12 of business" means insurance on real or personal property, as
13 defined in s. 624.604, including insurance for fire,
14 industrial fire, allied lines, farmowners multiperil,
15 homeowners multiperil, commercial multiperil, and mobile
16 homes, including liability coverage on all such insurance but
17 excluding inland marine as defined in s. 624.607(3) and
18 excluding vehicle insurance as defined in s. 624.605(1) other
19 than insurance on mobile homes used as permanent dwellings.
20 g. The procedures to be used by the corporation to
21 determine the statewide direct written premium for the subject
22 lines of business shall be included in the plan of operation,
23 with respect to the personal lines account, any personal lines
24 policy defined in s. 627.4025, and means, with respect to the
25 commercial lines account, all commercial property and
26 commercial fire insurance.
27 (c) The plan of operation of the corporation
28 association:
29 1. May provide for one or more designated insurers,
30 able and willing to provide policy and claims service, to act
31 on behalf of the association to provide such service. Each
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1 licensed agent shall be entitled to indicate the order of
2 preference regarding who will service the business placed by
3 the agent. The association shall adhere to each agent's
4 preferences unless after consideration of other factors in
5 assigning agents, including, but not limited to, servicing
6 capacity and fee arrangements, the association has reason to
7 believe it is in the best interest of the association to make
8 a different assignment.
9 1.2. Must provide for adoption of residential property
10 and casualty insurance policy forms and commercial residential
11 and nonresidential property insurance forms, which forms must
12 be approved by the department prior to use. The corporation
13 association shall adopt the following policy forms:
14 a. Standard personal lines policy forms including wind
15 coverage, which are multiperil policies providing what is
16 generally considered to be full coverage of a residential
17 property similar to the coverage provided under an HO-2, HO-3,
18 HO-4, or HO-6 policy.
19 b. Standard personal lines policy forms without wind
20 coverage, which are the same as the policies described in
21 sub-subparagraph a. except that they do not include wind
22 coverage.
23 b.c. Basic personal lines policy forms including wind
24 coverage, which are policies similar to an HO-8 policy or a
25 dwelling fire policy that provide coverage meeting the
26 requirements of the secondary mortgage market, but which
27 coverage is more limited than the coverage under a standard
28 policy.
29 d. Basic personal lines policy forms without wind
30 coverage, which are the same as the policies described in
31 sub-subparagraph c. except they do not include wind coverage.
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1 c.e. Commercial lines residential policy forms
2 including wind coverage that are generally similar to the
3 basic perils of full coverage obtainable for commercial
4 residential structures in the admitted voluntary market.
5 d. Commercial nonresidential property insurance forms
6 that cover the peril of wind only. Such form is applicable
7 only to commercial nonresidential properties located in areas
8 eligible for coverage in the Florida Windstorm Underwriting
9 Association as those areas were defined on January 1, 2001.
10 f. Commercial lines residential policy forms without
11 wind coverage, which are the same as the policies described in
12 sub-subparagraph e. except that they do not include wind
13 coverage.
14 2.3. May provide that the corporation association may
15 employ or otherwise contract with individuals or other
16 entities to provide administrative or professional services
17 that may be appropriate to effectuate the plan. The
18 corporation association shall have the power to borrow funds,
19 by issuing bonds or by incurring other indebtedness, and shall
20 have other powers reasonably necessary to effectuate the
21 requirements of this subsection. The corporation is
22 authorized, but is not required, to seek judicial validation
23 of its bonds or other indebtedness under chapter 75. The
24 corporation association may issue bonds or incur other
25 indebtedness, or have bonds issued on its behalf by a unit of
26 local government pursuant to subparagraph (g)2., in the
27 absence of a hurricane or other weather-related event, upon a
28 determination by the corporation association, subject to
29 approval by the department, that such action would enable it
30 to efficiently meet the financial obligations of the
31 corporation association and that such financings are
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1 reasonably necessary to effectuate the requirements of this
2 subsection. The corporation association is authorized to take
3 all actions needed to facilitate tax-free status for any such
4 bonds or indebtedness, including formation of trusts or other
5 affiliated entities. The corporation association shall have
6 the authority to pledge assessments, projected recoveries from
7 the Florida Hurricane Catastrophe Fund, other reinsurance
8 recoverables, market equalization and other surcharges, and
9 other funds available to the corporation association as
10 security for bonds or other indebtedness. In recognition of s.
11 10, Art. I of the State Constitution, prohibiting the
12 impairment of obligations of contracts, it is the intent of
13 the Legislature that no action be taken whose purpose is to
14 impair any bond indenture or financing agreement or any
15 revenue source committed by contract to such bond or other
16 indebtedness.
17 3.4. Must require that the corporation association
18 operate subject to the supervision and approval of a board of
19 governors consisting of 7 13 individuals appointed by the
20 Insurance Commissioner. The Insurance Commissioner shall
21 designate one of the appointees, including 1 who is elected as
22 chair. The board shall consist of:
23 a. The insurance consumer advocate appointed under s.
24 627.0613.
25 b. Five members designated by the insurance industry.
26 c. Five consumer representatives appointed by the
27 Insurance Commissioner. Two of the consumer representatives
28 must, at the time of appointment, be holders of policies
29 issued by the association, who are selected with consideration
30 given to reflecting the geographic balance of association
31 policyholders. Two of the consumer members must be individuals
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1 who are minority persons as defined in s. 288.703(3). One of
2 the consumer members shall have expertise in the field of
3 mortgage lending.
4 d. Two representatives of the insurance industry
5 appointed by the Insurance Commissioner. Of the two insurance
6 industry representatives appointed by the Insurance
7 Commissioner, at least one must be an individual who is a
8 minority person as defined in s. 288.703(3).
9
10 Any board member may be disapproved or removed and replaced by
11 the commissioner at any time for cause. All board members,
12 including the chair, must be appointed to serve for 3-year
13 terms beginning annually on a date designated by the plan. Any
14 board vacancy must be filled for the unexpired term of such
15 board member by appointment by the Insurance Commissioner.
16 4.5. Must provide a procedure for determining the
17 eligibility of a risk for coverage, as follows:
18 a. With respect to personal lines residential risks,
19 if the risk is offered full coverage from an authorized
20 insurer at the insurer's approved rate under either a standard
21 policy including wind coverage or, if consistent with the
22 insurer's underwriting rules as filed with the department, a
23 basic policy including wind coverage, the risk is not eligible
24 for any policy issued by the corporation association. If the
25 risk accepts an offer of coverage through the market
26 assistance plan or an offer of coverage through a mechanism
27 established by the corporation association before a policy is
28 issued to the risk by the corporation association or during
29 the first 30 days of coverage by the corporation association,
30 and the producing agent who submitted the application to the
31
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1 plan or to the corporation association is not currently
2 appointed by the insurer, the insurer shall: either
3 (I) Pay to the producing agent of record of the
4 policy, for the first year, an amount which is the greater of
5 the insurer's usual and customary commission for the type of
6 policy written or a policy fee equal to the usual and
7 customary commission of the corporation;
8 (II) Offer to allow the producing agent of record of
9 the policy to continue servicing the policy for a period of
10 not less than 1 year and offer to pay the agent the insurer's
11 usual and customary commission for the type of policy written;
12 or
13 (III) If the new or producing agent is an employee or
14 exclusive agent of the insurer, the new insurer shall pay the
15 agent in accordance with sub-sub-subparagraph (I). appoint the
16 agent to service the risk or, if the insurer places the
17 coverage through a new agent, require the new agent who then
18 writes the policy to pay not less than 50 percent of the first
19 year's commission to the producing agent who submitted the
20 application to the plan or the association, except that if the
21 new agent is an employee or exclusive agent of the insurer,
22 the new agent shall pay a policy fee of $50 to the producing
23 agent in lieu of splitting the commission.
24
25 If the risk is not able to obtain any such offer, the risk is
26 eligible for either a standard policy including wind coverage
27 or a basic policy including wind coverage issued by the
28 corporation association; however, if the risk could not be
29 insured under a standard policy including wind coverage
30 regardless of market conditions, the risk shall be eligible
31 for a basic policy including wind coverage unless rejected
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1 under subparagraph 7. 8. The corporation association shall
2 determine the type of policy to be provided on the basis of
3 objective standards specified in the underwriting manual and
4 based on generally accepted underwriting practices.
5 b. With respect to commercial lines residential risks,
6 if the risk is offered coverage under a policy including wind
7 coverage from an authorized insurer at its approved rate, the
8 risk is not eligible for any policy issued by the corporation
9 association. If the risk accepts an offer of coverage through
10 the market assistance plan or an offer of coverage through a
11 mechanism established by the corporation association before a
12 policy is issued to the risk by the corporation association,
13 and the producing agent who submitted the application to the
14 plan or the corporation association is not currently appointed
15 by the insurer, the insurer shall: either
16 (I) Pay to the producing agent of record of the
17 policy, for the first year, an amount which is the greater of
18 the insurer's usual and customary commission for the type of
19 policy written or a policy fee equal to the usual and
20 customary commission of the corporation;
21 (II) Offer to allow the producing agent of record of
22 the policy to continue servicing the policy for a period of
23 not less than one year and offer to pay the agent the
24 insurer's usual and customary commission for the type of
25 policy written; or
26 (III) If the new or producing agent is an employee or
27 exclusive agent of the insurer, the new insurer shall pay the
28 agent in accordance with sub-sub-subparagraph (I). appoint the
29 agent to service the risk or, if the insurer places the
30 coverage through a new agent, require the new agent who then
31 writes the policy to pay not less than 50 percent of the first
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1 year's commission to the producing agent who submitted the
2 application to the plan, except that if the new agent is an
3 employee or exclusive agent of the insurer, the new agent
4 shall pay a policy fee of $50 to the producing agent in lieu
5 of splitting the commission.
6
7 If the risk is not able to obtain any such offer, the risk is
8 eligible for a policy including wind coverage issued by the
9 corporation association.
10 c. This subparagraph does not require the association
11 to provide wind coverage or hurricane coverage in any area in
12 which such coverage is available through the Florida Windstorm
13 Underwriting Association.
14 5.6. Must include rules for classifications of risks
15 and rates therefor.
16 6.7. Must provide that if premium and investment
17 income attributable to a particular calendar plan year are in
18 excess of projected losses and expenses for an account of the
19 plan attributable to that year, such excess shall be held in
20 surplus in the account. Such surplus shall be available to
21 defray deficits as to future years and shall be used for that
22 purpose prior to assessing participating member insurers as to
23 any calendar plan year.
24 7.8. Must provide objective criteria and procedures to
25 be uniformly applied for all applicants in determining whether
26 an individual risk is so hazardous as to be uninsurable. In
27 making this determination and in establishing the criteria and
28 procedures, the following shall be considered:
29 a. Whether the likelihood of a loss for the individual
30 risk is substantially higher than for other risks of the same
31 class; and
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1 b. Whether the uncertainty associated with the
2 individual risk is such that an appropriate premium cannot be
3 determined.
4
5 The acceptance or rejection of a risk by the corporation
6 association shall be construed as the private placement of
7 insurance, and the provisions of chapter 120 shall not apply.
8 8.9. Must provide that the corporation association
9 shall make its best efforts to procure catastrophe reinsurance
10 at reasonable rates, as determined by the board of governors.
11 9.10. Must provide that in the event of regular
12 deficit assessments under sub-subparagraph (b)3.a. or
13 sub-subparagraph (b)3.b., in the personal lines account, the
14 commercial lines residential account, or the high-risk account
15 or by the Florida Windstorm Underwriting Association under
16 sub-sub-subparagraph (2)(b)2.d.(I) or sub-sub-subparagraph
17 (2)(b)2.d.(II), the corporation association shall levy upon
18 corporation association policyholders in such account in its
19 next rate filing, or by a separate rate filing solely for this
20 purpose, a market equalization surcharge in a percentage equal
21 to the total amount of such regular assessments divided by the
22 aggregate statewide direct written premium for subject lines
23 of business for participating member insurers for the prior
24 calendar year. Market equalization surcharges under this
25 subparagraph are not considered premium and are not subject to
26 commissions, fees, or premium taxes; however, failure to pay a
27 market equalization surcharge shall be treated as failure to
28 pay premium.
29 10.11. The policies issued by the corporation
30 association must provide that, if the corporation association
31 or the market assistance plan obtains an offer from an
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1 authorized insurer to cover the risk at its approved rates
2 under either a standard policy including wind coverage or a
3 basic policy including wind coverage, the risk is no longer
4 eligible for renewal coverage through the corporation
5 association. However, if the risk is located in an area in
6 which Florida Windstorm Underwriting Association coverage is
7 available, such an offer of a standard or basic policy
8 terminates eligibility regardless of whether or not the offer
9 includes wind coverage. Upon termination of eligibility, the
10 association shall provide written notice to the policyholder
11 and agent of record stating that the association policy shall
12 be canceled as of 60 days after the date of the notice because
13 of the offer of coverage from an authorized insurer. Other
14 provisions of the insurance code relating to cancellation and
15 notice of cancellation do not apply to actions under this
16 subparagraph.
17 11.12. Corporation Association policies and
18 applications must include a notice that the corporation
19 association policy could, under this section or s. 627.3511,
20 be replaced with a policy issued by an authorized admitted
21 insurer that does not provide coverage identical to the
22 coverage provided by the corporation association. The notice
23 shall also specify that acceptance of corporation association
24 coverage creates a conclusive presumption that the applicant
25 or policyholder is aware of this potential.
26 12.13. May establish, subject to approval by the
27 department, different eligibility requirements and operational
28 procedures for any line or type of coverage for any specified
29 county or area if the board determines that such changes to
30 the eligibility requirements and operational procedures are
31 justified due to the voluntary market being sufficiently
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1 stable and competitive in such area or for such line or type
2 of coverage and that consumers who, in good faith, are unable
3 to obtain insurance through the voluntary market through
4 ordinary methods would continue to have access to coverage
5 from the corporation association. When coverage is sought in
6 connection with a real property transfer, such requirements
7 and procedures shall not provide for an effective date of
8 coverage later than the date of the closing of the transfer as
9 established by the transferor, the transferee, and, if
10 applicable, the lender.
11 13. Shall provide that, with respect to the high-risk
12 account, any participating insurer with a surplus as to
13 policyholders of $20 million or less writing 25 percent or
14 more of its total countrywide property insurance premiums in
15 this state may petition the department, within the first 90
16 days of each calendar year, to qualify as a limited
17 apportionment corporation. In no event shall a limited
18 apportionment corporation be required to participate in any
19 assessment, within the high-risk account, pursuant to
20 sub-subparagraph (b)3.a. or sub-subparagraph (b)3.b. in the
21 aggregate which exceeds $50 million after payment of available
22 high-risk account funds in any calendar year. However, a
23 limited apportionment corporation shall collect from its
24 policyholders any emergency assessment imposed under
25 sub-subparagraph (b)3.d. The plan shall provide that, if the
26 department determines that any regular assessment will result
27 in an impairment of the surplus of a limited apportionment
28 corporation, the department may direct that all or part of
29 such assessment be deferred. However, there shall be no
30 limitation or deferment of an emergency assessment to be
31 collected from policyholders under sub-subparagraph (b)3.d.
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1 (d)1. It is the intent of the Legislature that the
2 rates for coverage provided by the corporation association be
3 actuarially sound and not competitive with approved rates
4 charged in the admitted voluntary market, so that the
5 corporation association functions as a residual market
6 mechanism to provide insurance only when the insurance cannot
7 be procured in the voluntary market. Rates shall include an
8 appropriate catastrophe loading factor that reflects the
9 actual catastrophic exposure of the corporation association
10 and recognizes that the association has little or no capital
11 or surplus; and the association shall carefully review each
12 rate filing to assure that provider compensation is not
13 excessive.
14 2. For each county, the average rates of the
15 corporation association for each line of business for personal
16 lines residential policies shall be no lower than the average
17 rates charged by the insurer that had the highest average rate
18 in that county among the 20 insurers with the greatest total
19 direct written premium in the state for that line of business
20 in the preceding year, except that with respect to mobile home
21 coverages, the average rates of the corporation association
22 shall be no lower than the average rates charged by the
23 insurer that had the highest average rate in that county among
24 the 5 insurers with the greatest total written premium for
25 mobile home owner's policies in the state in the preceding
26 year.
27 3. Rates for commercial residential coverage shall not
28 be subject to the requirements of subparagraph 2., but shall
29 be subject to all other requirements of this paragraph and s.
30 627.062.
31
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1 4. Nothing in this paragraph shall require or allow
2 the corporation association to adopt a rate that is inadequate
3 under s. 627.062 or to reduce rates approved under s. 627.062.
4 5. The association may require arbitration of a filing
5 pursuant to s. 627.062(6). Rate filings of the association
6 under this paragraph shall be made on a use and file basis
7 under s. 627.062(2)(a)2. The corporation association shall
8 make a rate filing at least once a year, but no more often
9 than quarterly.
10 (e) If coverage in an account through the association
11 is hereby activated effective upon approval of the plan, and
12 shall remain activated until coverage is deactivated pursuant
13 to paragraph (f). Thereafter, coverage through the corporation
14 association shall be reactivated by order of the department
15 only under one of the following circumstances:
16 1. If the market assistance plan receives a minimum of
17 100 applications for coverage within a 3-month period, or 200
18 applications for coverage within a 1-year period or less for
19 residential coverage, unless the market assistance plan
20 provides a quotation from admitted carriers at their filed
21 rates for at least 90 percent of such applicants. Any market
22 assistance plan application that is rejected because an
23 individual risk is so hazardous as to be uninsurable using the
24 criteria specified in subparagraph (c)8. shall not be included
25 in the minimum percentage calculation provided herein. In the
26 event that there is a legal or administrative challenge to a
27 determination by the department that the conditions of this
28 subparagraph have been met for eligibility for coverage in the
29 corporation association, any eligible risk may obtain coverage
30 during the pendency of such challenge.
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1 2. In response to a state of emergency declared by the
2 Governor under s. 252.36, the department may activate coverage
3 by order for the period of the emergency upon a finding by the
4 department that the emergency significantly affects the
5 availability of residential property insurance.
6 (f) The activities of the corporation association
7 shall be reviewed at least annually by the department to
8 determine whether board and, upon recommendation by the board
9 or petition of any interested party, coverage shall be
10 deactivated in an account on the basis if the department finds
11 that the conditions giving rise to its activation no longer
12 exist.
13 (g)1. The board shall certify to the department its
14 needs for annual assessments as to a particular calendar year,
15 and for any startup or interim assessments that it deems to be
16 necessary to sustain operations as to a particular year
17 pending the receipt of annual assessments. Upon verification,
18 the department shall approve such certification, and the board
19 shall levy such annual, startup, or interim assessments. Such
20 assessments shall be prorated as provided in paragraph (b).
21 The board shall take all reasonable and prudent steps
22 necessary to collect the amount of assessment due from each
23 participating member insurer, including, if prudent, filing
24 suit to collect such assessment. If the board is unable to
25 collect an assessment from any participating member insurer,
26 the uncollected assessments shall be levied as an additional
27 assessment against the participating member insurers and any
28 participating member insurer required to pay an additional
29 assessment as a result of such failure to pay shall have a
30 cause of action against such nonpaying participating member
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1 insurer. Assessments shall be included as an appropriate
2 factor in the making of rates.
3 2. The governing body of any unit of local government,
4 any residents of which are insured by the corporation
5 association, may issue bonds as defined in s. 125.013 or s.
6 166.101 from time to time to fund an assistance program, in
7 conjunction with the corporation association, for the purpose
8 of defraying deficits of the corporation association. In order
9 to avoid needless and indiscriminate proliferation,
10 duplication, and fragmentation of such assistance programs,
11 any unit of local government, any residents of which are
12 insured by the corporation association, may provide for the
13 payment of losses, regardless of whether or not the losses
14 occurred within or outside of the territorial jurisdiction of
15 the local government. Revenue bonds may not be issued until
16 validated pursuant to chapter 75, unless a state of emergency
17 is declared by executive order or proclamation of the Governor
18 pursuant to s. 252.36 making such findings as are necessary to
19 determine that it is in the best interests of, and necessary
20 for, the protection of the public health, safety, and general
21 welfare of residents of this state and the protection and
22 preservation of the economic stability of insurers operating
23 in this state, and declaring it an essential public purpose to
24 permit certain municipalities or counties to issue such bonds
25 as will permit relief to claimants and policyholders of the
26 corporation joint underwriting association and insurers
27 responsible for apportionment of corporation association
28 losses. Any such unit of local government may enter into such
29 contracts with the corporation association and with any other
30 entity created pursuant to this subsection as are necessary to
31 carry out this paragraph. Any bonds issued under this
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1 subparagraph shall be payable from and secured by moneys
2 received by the corporation association from emergency
3 assessments under sub-subparagraph (b)3.d., and assigned and
4 pledged to or on behalf of the unit of local government for
5 the benefit of the holders of such bonds. The funds, credit,
6 property, and taxing power of the state or of the unit of
7 local government shall not be pledged for the payment of such
8 bonds. If any of the bonds remain unsold 60 days after
9 issuance, the department shall require all insurers subject to
10 assessment to purchase the bonds, which shall be treated as
11 admitted assets; each insurer shall be required to purchase
12 that percentage of the unsold portion of the bond issue that
13 equals the insurer's relative share of assessment liability
14 under this subsection. An insurer shall not be required to
15 purchase the bonds to the extent that the department
16 determines that the purchase would endanger or impair the
17 solvency of the insurer.
18 3.a. In addition to any credits, bonuses, or
19 exemptions provided under s. 627.3511, The board shall adopt a
20 program subject to approval by the department for the
21 reduction of both new and renewal writings in the corporation
22 association. The board may consider any prudent and not
23 unfairly discriminatory approach to reducing corporation
24 association writings, and may but must adopt at least a credit
25 against assessment liability or other liability that provides
26 an incentive for insurers to take risks out of the corporation
27 association and to keep risks out of the corporation
28 association by maintaining or increasing voluntary writings in
29 counties or areas in which corporation association risks are
30 highly concentrated and a program to provide a formula under
31 which an insurer voluntarily taking risks out of the
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1 corporation association by maintaining or increasing voluntary
2 writings will be relieved wholly or partially from assessments
3 under sub-subparagraphs (b)3.a. and b. When the corporation
4 enters into a contractual agreement for a take-out plan, the
5 producing agent of record of the corporation policy is
6 entitled to retain any unearned commission on such policy, and
7 the insurer shall:
8 (I) Pay to the producing agent of record of the
9 policy, for the first year, an amount which is the greater of
10 the insurer's usual and customary commission for the type of
11 policy written or a policy fee equal to the usual and
12 customary commission of the corporation;
13 (II) Offer to allow the producing agent of record of
14 the policy to continue servicing the policy for a period of
15 not less than one year and offer to pay the agent the
16 insurer's usual and customary commission for the type of
17 policy written; or
18 (III) If the new or producing agent is an employee or
19 exclusive agent of the insurer, the new insurer shall pay the
20 agent in accordance with sub-sub-subparagraph (I).
21 b. Any credit or exemption from regular assessments
22 adopted under this subparagraph shall last no longer than the
23 3 years following the cancellation or expiration of the policy
24 by the corporation association. With the approval of the
25 department, the board may extend such credits for an
26 additional year if the insurer guarantees an additional year
27 of renewability for all policies removed from the corporation
28 association, or for 2 additional years if the insurer
29 guarantees 2 additional years of renewability for all policies
30 so removed.
31
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1 c. There shall be no credit, limitation, exemption, or
2 deferment from emergency assessments to be collected from
3 policyholders pursuant to sub-subparagraph (b)3.d.
4 4. The plan shall provide for the deferment, in whole
5 or in part, of the assessment of a participating member
6 insurer, other than an emergency assessment collected from
7 policyholders pursuant to sub-subparagraph (b)3.d., if the
8 department finds that payment of the assessment would endanger
9 or impair the solvency of the insurer. In the event an
10 assessment against a participating member insurer is deferred
11 in whole or in part, the amount by which such assessment is
12 deferred may be assessed against the other participating
13 member insurers in a manner consistent with the basis for
14 assessments set forth in paragraph (b).
15 (h) Nothing in this subsection shall be construed to
16 preclude the issuance of residential property insurance
17 coverage pursuant to part VIII of chapter 626.
18 (i) There shall be no liability on the part of, and no
19 cause of action of any nature shall arise against, any
20 participating member insurer or its agents or employees, the
21 corporation association or its agents or employees, members of
22 the board of governors or their respective designees at a
23 board meeting, corporation association committee members, or
24 the department or its representatives, for any action taken by
25 them in the performance of their duties or responsibilities
26 under this subsection. Such immunity does not apply to:
27 1. Any of the foregoing persons or entities for any
28 willful tort;
29 2. The corporation association or its servicing or
30 producing agents for breach of any contract or agreement
31 pertaining to insurance coverage;
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1 3. The corporation association with respect to
2 issuance or payment of debt; or
3 4. Any participating member insurer with respect to
4 any action to enforce a participating member insurer's
5 obligations to the corporation association under this
6 subsection.
7 (j) The corporation Residential Property and Casualty
8 Joint Underwriting Association is not a state agency, board,
9 or commission, but is a legislatively created public benefits
10 corporation serving a public purpose. However, For the
11 purposes of s. 199.183(1), the corporation Residential
12 Property and Casualty Joint Underwriting Association shall be
13 considered a political subdivision of the state and shall be
14 exempt from the corporate income tax and the state premium
15 tax. The corporation is not required to obtain or to hold a
16 certificate of authority issued by the department, nor is it
17 required to participate as a member insurer of the Florida
18 Insurance Guaranty Association. However, the corporation shall
19 pay assessments pledged by the Florida Insurance Guaranty
20 Association to secure bonds issued or other indebtedness
21 incurred to pay covered claims arising from insurer
22 insolvencies caused by, or proximately related to, hurricane
23 losses.
24 (k) Upon a determination by the department board of
25 governors that the conditions giving rise to the establishment
26 and activation of the corporation association no longer exist,
27 and upon the consent thereto by order of the department, the
28 corporation association is dissolved. Upon dissolution, the
29 assets of the association shall be applied first to pay all
30 debts, liabilities, and obligations of the corporation
31 association, including the establishment of reasonable
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1 reserves for any contingent liabilities or obligations, and
2 all remaining assets of the corporation association shall
3 become property of the state and deposited in the Florida
4 Hurricane Catastrophe Fund.
5 (l)1. Effective October 1, 2001, policies of the
6 Residential Property and Casualty Joint Underwriting
7 Association shall become policies of the corporation. All
8 obligations, rights, assets and liabilities of the Residential
9 Property and Casualty Joint Underwriting Association,
10 including bonds, note and debt obligations, and the financing
11 documents pertaining to them become those of the corporation
12 as of October 1, 2001. The corporation is not required to
13 issue endorsements or certificates of assumption to insureds
14 during the remaining term of in-force transferred policies.
15 2. Effective October 1, 2001, policies of the Florida
16 Windstorm Underwriting Association are transferred to the
17 corporation and shall become policies of the corporation. All
18 obligations, rights, assets and liabilities of the Florida
19 Windstorm Underwriting Association, including bonds, note, and
20 debt obligations, and the financing documents pertaining to
21 them are transferred to and assumed by the corporation on
22 October 1, 2001. The corporation is not required to issue
23 endorsement or certificates of assumption to insureds during
24 the remaining term of in-force transferred policies.
25 3. For policies transferred to the corporation from
26 the Florida Windstorm Underwriting Association with an
27 expiration date on or after January 1, 2002, notices of
28 nonrenewal shall be timely issued in accordance with s.
29 627.4133(2)(b). When the policyholder's wind-only policy is
30 nonrenewed, the corporation shall offer coverage under an
31 appropriate policy, covering the perils described in paragraph
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1 (c), if the policyholder is otherwise eligible for coverage
2 from the corporation.
3 4. The Florida Windstorm Underwriting Association and
4 the Residential Property and Casualty Joint Underwriting
5 Association shall take all actions as may be proper to further
6 evidence such transfers and shall provide such documents and
7 instruments of further assurance as may reasonably be
8 requested by the corporation for such purpose. The corporation
9 shall execute such assumptions and instruments as the trustees
10 or other parties to the financing documents of the Florida
11 Windstorm Underwriting Association or the Residential Property
12 and Casualty Joint Underwriting Association may reasonably
13 request to further evidence such transfers and assumptions,
14 which transfers and assumptions, however, shall be effective
15 as of the date provided under this paragraph whether or not,
16 and regardless of the date on which, such assumptions or
17 instruments are executed by the corporation. Subject to the
18 relevant financing documents pertaining to their outstanding
19 bonds, notes, indebtedness, or other financing obligations,
20 the moneys, investments, receivables, choses in action, and
21 other intangibles of the Florida Windstorm Underwriting
22 Association shall be credited to the high-risk account of the
23 corporation, and the personal lines residential coverage
24 account and the commercial lines residential coverage account
25 of the Residential Property and Casualty Joint Underwriting
26 Association shall be credited to the personal lines account
27 and the commercial lines account, respectively, of the
28 corporation.
29 5. Effective October 1, 2001, a new applicant for
30 property insurance coverage who would have otherwise been
31 eligible for coverage in the Florida Windstorm Underwriting
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1 Association shall be eligible for coverage from the
2 corporation as provided in this paragraph.
3 6. The transfer of all policies, obligations, rights,
4 assets, and liabilities from the Florida Windstorm
5 Underwriting Association to the corporation and the renaming
6 of the Residential Property and Casualty Joint Underwriting
7 Association as the corporation shall in no way affect the
8 coverage with respect to covered policies as defined in s.
9 215.555(2)(c) provided to these entities by the Florida
10 Hurricane Catastrophe Fund. The coverage provided by the
11 Florida Hurricane Catastrophe Fund to the Florida Windstorm
12 Underwriting Association based on its exposures as of June 30,
13 2001, and each June 30 thereafter shall be redesignated as
14 coverage for the high-risk account of the corporation. The
15 coverage provided by the Florida Hurricane Catastrophe Fund to
16 the Residential Property and Casualty Joint Underwriting
17 Association based on its exposures as of June 30, 2001, and
18 each June 30 thereafter shall be transferred to the personal
19 lines account and the commercial lines account of the
20 corporation. The high-risk account shall be treated, for all
21 Florida Hurricane Catastrophe Fund purposes, as if it were a
22 separate participating insurer with its own exposures,
23 reimbursement premium, and loss reimbursement. Likewise, the
24 personal lines and commercial lines accounts shall be viewed
25 together, for all Florida Hurricane Catastrophe Fund purposes,
26 as if the two accounts were one and represent a single,
27 separate participating insurer with its own exposures,
28 reimbursement premium, and loss reimbursement. The coverage
29 provided by the Florida Hurricane Catastrophe Fund to the
30 corporation shall constitute and operate as a full transfer of
31 coverage from the Florida Windstorm Underwriting Association
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1 and Residential Property and Casualty Joint Underwriting to
2 the corporation.
3 7. The department may, by order, postpone the October
4 1, 2001, effective dates set forth in this paragraph if the
5 department finds that effectuation of these dates cannot be
6 accomplished due to emergency conditions. All obligations,
7 rights, assets, and liabilities of the Florida Property and
8 Casualty Joint Underwriting Association created by subsection
9 (5), which obligations, rights, assets, or liabilities relate
10 to the provision of commercial lines residential property
11 insurance coverage as described in this section are hereby
12 transferred to the Residential Property and Casualty Joint
13 Underwriting Association. The Residential Property and
14 Casualty Joint Underwriting Association is not required to
15 issue endorsements or certificates of assumption to insureds
16 during the remaining term of in-force transferred policies.
17 (m) Notwithstanding any other provision of law:
18 1. The pledge or sale of, the lien upon, and the
19 security interest in any rights, revenues, or other assets of
20 the corporation association created or purported to be created
21 pursuant to any financing documents to secure any bonds or
22 other indebtedness of the corporation association shall be and
23 remain valid and enforceable, notwithstanding the commencement
24 of and during the continuation of, and after, any
25 rehabilitation, insolvency, liquidation, bankruptcy,
26 receivership, conservatorship, reorganization, or similar
27 proceeding against the corporation association under the laws
28 of this state.
29 2. No such proceeding shall relieve the corporation
30 association of its obligation, or otherwise affect its ability
31 to perform its obligation, to continue to collect, or levy and
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1 collect, assessments, market equalization or other surcharges
2 under subparagraph (c)9. (c)10., or any other rights,
3 revenues, or other assets of the corporation association
4 pledged pursuant to any financing documents.
5 3. Each such pledge or sale of, lien upon, and
6 security interest in, including the priority of such pledge,
7 lien, or security interest, any such assessments, market
8 equalization or other surcharges, or other rights, revenues,
9 or other assets which are collected, or levied and collected,
10 after the commencement of and during the pendency of, or
11 after, any such proceeding shall continue unaffected by such
12 proceeding. As used in this subsection, the term "financing
13 documents" means any agreement or agreements, instrument or
14 instruments, or other document or documents now existing or
15 hereafter created evidencing any bonds or other indebtedness
16 of the corporation association or pursuant to which any such
17 bonds or other indebtedness has been or may be issued and
18 pursuant to which any rights, revenues, or other assets of the
19 corporation association are pledged or sold to secure the
20 repayment of such bonds or indebtedness, together with the
21 payment of interest on such bonds or such indebtedness, or the
22 payment of any other obligation or financial product, as
23 defined in the plan of operation of the corporation
24 association related to such bonds or indebtedness.
25 4. Any such pledge or sale of assessments, revenues,
26 contract rights, or other rights or assets of the corporation
27 association shall constitute a lien and security interest, or
28 sale, as the case may be, that is immediately effective and
29 attaches to such assessments, revenues, or contract rights or
30 other rights or assets, whether or not imposed or collected at
31 the time the pledge or sale is made. Any such pledge or sale
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1 is effective, valid, binding, and enforceable against the
2 corporation association or other entity making such pledge or
3 sale, and valid and binding against and superior to any
4 competing claims or obligations owed to any other person or
5 entity, including policyholders in this state, asserting
6 rights in any such assessments, revenues, or contract rights
7 or other rights or assets to the extent set forth in and in
8 accordance with the terms of the pledge or sale contained in
9 the applicable financing documents, whether or not any such
10 person or entity has notice of such pledge or sale and without
11 the need for any physical delivery, recordation, filing, or
12 other action.
13 (n)1. The following records of the corporation
14 Residential Property and Casualty Joint Underwriting
15 Association are confidential and exempt from the provisions of
16 s. 119.07(1) and s. 24(a), Art. I of the State Constitution:
17 a. Underwriting files, except that a policyholder or
18 an applicant shall have access to his or her own underwriting
19 files.
20 b. Claims files, until termination of all litigation
21 and settlement of all claims arising out of the same incident,
22 although portions of the claims files may remain exempt, as
23 otherwise provided by law. Confidential and exempt claims file
24 records may be released to other governmental agencies upon
25 written request and demonstration of need; such records held
26 by the receiving agency remain confidential and exempt as
27 provided for herein.
28 c. Records obtained or generated by an internal
29 auditor pursuant to a routine audit, until the audit is
30 completed, or if the audit is conducted as part of an
31 investigation, until the investigation is closed or ceases to
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1 be active. An investigation is considered "active" while the
2 investigation is being conducted with a reasonable, good faith
3 belief that it could lead to the filing of administrative,
4 civil, or criminal proceedings.
5 d. Matters reasonably encompassed in privileged
6 attorney-client communications.
7 e. Proprietary information licensed to the corporation
8 association under contract and the contract provides for the
9 confidentiality of such proprietary information.
10 f. All information relating to the medical condition
11 or medical status of a corporation an association employee
12 which is not relevant to the employee's capacity to perform
13 his or her duties, except as otherwise provided in this
14 paragraph. Information which is exempt shall include, but is
15 not limited to, information relating to workers' compensation,
16 insurance benefits, and retirement or disability benefits.
17 g. Upon an employee's entrance into the employee
18 assistance program, a program to assist any employee who has a
19 behavioral or medical disorder, substance abuse problem, or
20 emotional difficulty which affects the employee's job
21 performance, all records relative to that participation shall
22 be confidential and exempt from the provisions of s. 119.07(1)
23 and s. 24(a), Art. I of the State Constitution, except as
24 otherwise provided in s. 112.0455(11).
25 h. Information relating to negotiations for financing,
26 reinsurance, depopulation, or contractual services, until the
27 conclusion of the negotiations.
28 i. Minutes of closed meetings regarding underwriting
29 files, and minutes of closed meetings regarding an open claims
30 file until termination of all litigation and settlement of all
31
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1 claims with regard to that claim, except that information
2 otherwise confidential or exempt by law will be redacted.
3
4 When an authorized insurer is considering underwriting a risk
5 insured by the corporation association, relevant underwriting
6 files and confidential claims files may be released to the
7 insurer provided the insurer agrees in writing, notarized and
8 under oath, to maintain the confidentiality of such files.
9 When a file is transferred to an insurer that file is no
10 longer a public record because it is not held by an agency
11 subject to the provisions of the public records law.
12 Underwriting files and confidential claims files may also be
13 released to staff of and the board of governors of the market
14 assistance plan established pursuant to s. 627.3515, who must
15 retain the confidentiality of such files, except such files
16 may be released to authorized insurers that are considering
17 assuming the risks to which the files apply, provided the
18 insurer agrees in writing, notarized and under oath, to
19 maintain the confidentiality of such files. Finally, the
20 corporation association or the board or staff of the market
21 assistance plan may make the following information obtained
22 from underwriting files and confidential claims files
23 available to licensed general lines insurance agents: name,
24 address, and telephone number of the residential property
25 owner or insured; location of the risk; rating information;
26 loss history; and policy type. The receiving licensed general
27 lines insurance agent must retain the confidentiality of the
28 information received.
29 2. Portions of meetings of the corporation Residential
30 Property and Casualty Joint Underwriting Association are
31 exempt from the provisions of s. 286.011 and s. 24(b), Art. I
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1 of the State Constitution wherein confidential underwriting
2 files or confidential open claims files are discussed. All
3 portions of corporation association meetings which are closed
4 to the public shall be recorded by a court reporter. The
5 court reporter shall record the times of commencement and
6 termination of the meeting, all discussion and proceedings,
7 the names of all persons present at any time, and the names of
8 all persons speaking. No portion of any closed meeting shall
9 be off the record. Subject to the provisions hereof and s.
10 119.07(2)(a), the court reporter's notes of any closed meeting
11 shall be retained by the corporation association for a minimum
12 of 5 years. A copy of the transcript, less any exempt matters,
13 of any closed meeting wherein claims are discussed shall
14 become public as to individual claims after settlement of the
15 claim.
16 (o) In enacting the provisions of this act, the
17 Legislature recognizes that both the Florida Windstorm
18 Underwriting Association and the Residential Property and
19 Casualty Joint Underwriting Association have entered into
20 financing arrangements that obligate each entity to service
21 its debts and maintain the capacity to repay funds secured
22 under these financing arrangements. It is the intent of the
23 Legislature that nothing herein be construed to compromise,
24 diminish, or interfere with the rights of creditors under such
25 financing arrangements. It is further the intent of the
26 Legislature to preserve the obligations of the Florida
27 Windstorm Underwriting Association and Residential Property
28 and Casualty Joint Underwriting Association with regard to
29 outstanding financing arrangements, with such obligations
30 passing entirely and unchanged to the corporation. So long as
31 any bonds, notes, indebtedness, or other financing obligations
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1 of the Florida Windstorm Underwriting Association or the
2 Residential Property and Casualty Joint Underwriting
3 Association are outstanding, under the terms of the financing
4 documents pertaining to them, the governing board of the
5 corporation shall have and shall exercise the authority to
6 levy, charge, collect, and receive all premiums, assessments,
7 surcharges, charges, revenues and receipts that such
8 associations had authority to levy, charge, collect, or
9 receive under the provisions of subsection (2) and subsection
10 (6), respectively, as they existed on January 1, 2001, to the
11 extent necessary to provide moneys, together with other
12 available moneys of the corporation without exercise of the
13 authority provided by this paragraph, in at least the amounts,
14 and by the times, as would be provided under those former
15 provisions of subsection (2) or subsection (6), respectively,
16 so that the value, amount, and collectability of any assets,
17 revenues, or revenue source pledged or committed to, or any
18 lien thereon securing such outstanding bonds, notes,
19 indebtedness, or other financing obligations will not be
20 diminished, impaired, or adversely affected by the amendments
21 made by this act and to permit compliance with all provisions
22 of financing documents pertaining to such bonds, notes,
23 indebtedness, or other financing obligations, or the security
24 or credit enhancement for them, and any reference in this
25 subsection to bonds, notes, indebtedness, financing
26 obligations, or similar obligations, of the corporation shall
27 include like instruments or contracts of the Florida Windstorm
28 Underwriting Association and the Residential Property and
29 Casualty Joint Underwriting Association to the extent not
30 inconsistent with the provisions of the financing documents
31 pertaining to them.
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Florida Senate - 2001 SB 2234
39-1236-01
1 Section 2. This act shall take effect July 1, 2001.
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4 SENATE SUMMARY
5 Renames the Residential Property and Casualty Joint
Underwriting Association as the Citizens Property
6 Insurance Corporation to provide residential and
commercial property insurance through a public benefits
7 corporation. Requires insurers selling property insurance
in this state to participate in the corporation. Provides
8 a plan of operation and a board of governors. Divides the
revenues, assets, liabilities, losses, and expenses of
9 the corporation into three accounts and provides for
emergency assessments for policyholders of participating
10 insurers. Provides that the corporation need not obtain a
certificate of authority from the Department of Insurance
11 or be a member of the Florida Insurance Guaranty
Association. Requires the corporation to pay assessments
12 pledged to secure bonds to pay covered claims arising
from insurer insolvencies caused by hurricane losses.
13 Provides for the transfer of policies, assets, and
liabilities of the association and the Florida Windstorm
14 Underwriting Association to the corporation. (See bill
for details.)
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