House Bill hb0679c1
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Florida House of Representatives - 2002 CS/HB 679
By the Committee on Insurance and Representatives Brown
and Melvin
1 A bill to be entitled
2 An act relating to insurance; amending s.
3 627.7295, F.S.; clarifying an exception;
4 providing an additional exception to a
5 requirement that a minimum of 2 months' premium
6 be collected to issue a policy or binder for
7 motor vehicle insurance; amending s. 627.901,
8 F.S.; authorizing insurance agents and insurers
9 that finance premiums for certain policies to
10 bill in a certain manner; providing an
11 effective date.
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13 Be It Enacted by the Legislature of the State of Florida:
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15 Section 1. Subsection (7) of section 627.7295, Florida
16 Statutes, is amended to read:
17 627.7295 Motor vehicle insurance contracts.--
18 (7) A policy of private passenger motor vehicle
19 insurance or a binder for such a policy may be initially
20 issued in this state only if the insurer or agent has
21 collected from the insured an amount equal to 2 months'
22 premium. An insurer, agent, or premium finance company may
23 not directly or indirectly take any action resulting in the
24 insured having paid from the insured's own funds an amount
25 less than the 2 months' premium required by this subsection.
26 This subsection applies without regard to whether the premium
27 is financed by a premium finance company or is paid pursuant
28 to a periodic payment plan of an insurer or an insurance
29 agent. This subsection does not apply if an insured or member
30 of the insured's family is renewing or replacing a policy or a
31 binder for such policy written by the same insurer or a member
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Florida House of Representatives - 2002 CS/HB 679
200-570-02
1 of the same insurer group. This subsection does not apply to
2 an insurer that issues private passenger motor vehicle
3 coverage primarily to active duty or former military personnel
4 or their dependents. This subsection does not apply if all
5 policy payments are paid pursuant to a payroll deduction plan
6 or an automatic electronic funds transfer payment plan from
7 the policyholder, provided that the first policy payment may
8 be is made by cash, cashier's check, check, or a money order.
9 This subsection and subsection (4) do not apply if all policy
10 payments to an insurer are paid pursuant to an automatic
11 electronic funds transfer payment plan from an agent or a
12 managing general agent, or if the policy is issued pursuant to
13 the transfer of a private passenger motor vehicle insurance
14 book of business by an agent from one insurer to another,
15 provided that and if the policy includes, at a minimum,
16 personal injury protection pursuant to ss. 627.730-627.7405;
17 motor vehicle property damage liability pursuant to s.
18 627.7275; and bodily injury liability in at least the amount
19 of $10,000 because of bodily injury to, or death of, one
20 person in any one accident and in the amount of $20,000
21 because of bodily injury to, or death of, two or more persons
22 in any one accident. This subsection and subsection (4) do not
23 apply if an insured has had a policy in effect for at least 6
24 months, the insured's agent is terminated by the insurer that
25 issued the policy, and the insured obtains coverage on the
26 policy's renewal date with a new company through the
27 terminated agent.
28 Section 2. Subsection (1) of section 627.901, Florida
29 Statutes, is amended to read:
30 627.901 Premium financing by an insurance agent or
31 agency.--
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Florida House of Representatives - 2002 CS/HB 679
200-570-02
1 (1) A general lines agent may make reasonable service
2 charges for financing insurance premiums on policies issued or
3 business produced by such an agent or agency, s. 626.9541
4 notwithstanding. The service charge shall not exceed $1 per
5 installment, or a $6 total service charge per year, for any
6 premium balance of $120 or less. For any premium balance
7 greater than $120 but not more than $220, the service charge
8 shall not exceed $9 per year. The maximum service charge for
9 any premium balance greater than $220 shall not exceed $12 per
10 year. In lieu of such service charges, an insurance agent or
11 agency may charge a rate of interest not to exceed 18 percent
12 simple interest per year on the average unpaid balance as
13 billed over the term of the policy and subject to endorsement
14 changes. The interest authorized by this section may be billed
15 in equal installments.
16 Section 3. This act shall take effect July 1, 2002.
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