HB 1251

1
A bill to be entitled
2An act relating to a joint underwriting plan of insurers;
3amending s. 627.311, F.S.; revising provisions requiring
4the Office of Insurance Regulation to approve a joint
5underwriting plan for workers' compensation and employer's
6liability insurers; requiring plan rates to be
7noncompetitive with the voluntary market for certain
8purposes; deleting authorization for insureds to select
9certain alternative coverages; requiring the plan of
10operation to establish three tiers for eligible employers;
11specifying criteria and rates for each tier; providing for
12an Assigned Risk Adjustment Program for certain employers;
13deleting provisions requiring establishment of certain
14subplans; providing policyholder choice under certain
15circumstances; providing requirements for premiums under
16such tiers; revising criteria, requirements, and
17limitations for a required depopulation program to reduce
18numbers of insureds under the tiers; providing an
19application fee for administration and fraud prevention;
20revising certain tier notice requirements; providing for
21funding of the plan through deficit funding; providing for
22a one-time capital contribution from the Workers'
23Compensation Administration Trust Fund to defray deficits
24prior to certain assessments; providing a mechanism for
25collecting deficit assessments; providing duties of the
26office; providing requirements, procedures, and
27limitations for collecting and enforcing deficit
28assessments; providing for transfers of funds from the
29Workers' Compensation Administration Trust Fund to the
30plan under certain circumstances; providing an exclusion
31for deficit assessments from certain taxes; specifying
32that deficit assessments are plan funds when collected;
33providing notice requirements for certain policies;
34providing for liability of certain insureds for certain
35additional deficit assessments; specifying venue for
36proceedings to enforce or collect assessments; expanding a
37prohibition against providing certain persons with
38workers' compensation and employers' liability insurance;
39providing an exclusion for the plan from certain taxes and
40assessments; providing an effective date.
41
42Be It Enacted by the Legislature of the State of Florida:
43
44     Section 1.  Paragraphs (a), (c), (d), (e), (g), and (p) of
45subsection (5) of section 627.311, Florida Statutes, are
46amended, and paragraph (q) is added to said subsection, to read:
47     627.311  Joint underwriters and joint reinsurers; public
48records and public meetings exemptions.--
49     (5)(a)  The office shall, after consultation with insurers,
50approve a joint underwriting plan of insurers which shall
51operate as a nonprofit entity. For the purposes of this
52subsection, the term "insurer" includes group self-insurance
53funds authorized by s. 624.4621, commercial self-insurance funds
54authorized by s. 624.462, assessable mutual insurers authorized
55under s. 628.6011, and insurers licensed to write workers'
56compensation and employer's liability insurance in this state.
57The purpose of the plan is to provide workers' compensation and
58employer's liability insurance to applicants who are required by
59law to maintain workers' compensation and employer's liability
60insurance and who are in good faith entitled to but who are
61unable to procure purchase such insurance through the voluntary
62market. The plan must have actuarially sound rates that ensure
63assure that the plan is self-supporting.
64     (c)  The operation of the plan shall be governed by a plan
65of operation that is prepared at the direction of the board of
66governors. The plan of operation may be changed at any time by
67the board of governors or upon request of the office. The plan
68of operation and all changes thereto are subject to the approval
69of the office. The plan of operation shall:
70     1.  Authorize the board to engage in the activities
71necessary to implement this subsection, including, but not
72limited to, borrowing money.
73     2.  Develop criteria for eligibility for coverage by the
74plan, including, but not limited to, documented rejection by at
75least two insurers which reasonably assures that insureds
76covered under the plan are unable to acquire coverage in the
77voluntary market. Any insured may voluntarily elect to accept
78coverage from an insurer for a premium equal to or greater than
79the plan premium if the insurer writing the coverage adheres to
80the provisions of s. 627.171.
81     3.  Require notice from the agent to the insured at the
82time of the application for coverage that the application is for
83coverage with the plan and that coverage may be available
84through an insurer, group self-insurers' fund, commercial self-
85insurance fund, or assessable mutual insurer through another
86agent at a lower cost.
87     4.  Establish programs to encourage insurers to provide
88coverage to applicants of the plan in the voluntary market and
89to insureds of the plan, including, but not limited to:
90     a.  Establishing procedures for an insurer to use in
91notifying the plan of the insurer's desire to provide coverage
92to applicants to the plan or existing insureds of the plan and
93in describing the types of risks in which the insurer is
94interested. The description of the desired risks must be on a
95form developed by the plan.
96     b.  Developing forms and procedures that provide an insurer
97with the information necessary to determine whether the insurer
98wants to write particular applicants to the plan or insureds of
99the plan.
100     c.  Developing procedures for notice to the plan and the
101applicant to the plan or insured of the plan that an insurer
102will insure the applicant or the insured of the plan, and notice
103of the cost of the coverage offered; and developing procedures
104for the selection of an insuring entity by the applicant or
105insured of the plan.
106     d.  Provide for a market-assistance plan to assist in the
107placement of employers. All applications for coverage in the
108plan received 45 days before the effective date for coverage
109shall be processed through the market-assistance plan. A market-
110assistance plan specifically designed to serve the needs of
111small, good policyholders as defined by the board must be
112finalized by January 1, 1994.
113     5.  Provide for policy and claims services to the insureds
114of the plan of the nature and quality provided for insureds in
115the voluntary market.
116     6.  Provide for the review of applications for coverage
117with the plan for reasonableness and accuracy, using any
118available historic information regarding the insured.
119     7.  Provide for procedures for auditing insureds of the
120plan which are based on reasonable business judgment and are
121designed to maximize the likelihood that the plan will collect
122the appropriate premiums.
123     8.  Authorize the plan to terminate the coverage of and
124refuse future coverage for any insured that submits a fraudulent
125application to the plan or provides fraudulent or grossly
126erroneous records to the plan or to any service provider of the
127plan in conjunction with the activities of the plan.
128     9.  Establish service standards for agents who submit
129business to the plan.
130     10.  Establish criteria and procedures to prohibit any
131agent who does not adhere to the established service standards
132from placing business with the plan or receiving, directly or
133indirectly, any commissions for business placed with the plan.
134     11.  Provide for the establishment of reasonable safety
135programs for all insureds in the plan. All insureds of the plan
136must participate in the safety program.
137     12.  Authorize the plan to terminate the coverage of and
138refuse future coverage to any insured who fails to pay premiums
139or surcharges when due; who, at the time of application, is
140delinquent in payments of workers' compensation or employer's
141liability insurance premiums or surcharges owed to an insurer,
142group self-insurers' fund, commercial self-insurance fund, or
143assessable mutual insurer licensed to write such coverage in
144this state; or who refuses to substantially comply with any
145safety programs recommended by the plan.
146     13.  Authorize the board of governors to provide the
147services required by the plan through staff employed by the
148plan, through reasonably compensated service providers who
149contract with the plan to provide services as specified by the
150board of governors, or through a combination of employees and
151service providers.
152     14.  Provide for service standards for service providers,
153methods of determining adherence to those service standards,
154incentives and disincentives for service, and procedures for
155terminating contracts for service providers that fail to adhere
156to service standards.
157     15.  Provide procedures for selecting service providers and
158standards for qualification as a service provider that
159reasonably assure that any service provider selected will
160continue to operate as an ongoing concern and is capable of
161providing the specified services in the manner required.
162     16.  Provide for reasonable accounting and data-reporting
163practices.
164     17.  Provide for annual review of costs associated with the
165administration and servicing of the policies issued by the plan
166to determine alternatives by which costs can be reduced.
167     18.  Authorize the acquisition of such excess insurance or
168reinsurance as is consistent with the purposes of the plan.
169     19.  Provide for an annual report to the office on a date
170specified by the office and containing such information as the
171office reasonably requires.
172     20.  Establish multiple rating plans for various
173classifications of risk which reflect risk of loss, hazard
174grade, actual losses, size of premium, and compliance with loss
175control. At least one of such plans must be a preferred-rating
176plan to accommodate small-premium policyholders with good
177experience as defined in sub-subparagraph 22.a.
178     21.  Establish agent commission schedules.
179     22.  For employers otherwise eligible for coverage under
180the plan, establish three tiers of employers meeting the
181criteria and subject to the rate limitations specified in this
182subparagraph. Establish four subplans as follows:
183     a.  Tier One.--
184     (I)  Criteria; rated employers.--An employer that has an
185experience modification rating shall be included in Tier One if
186the employer meets all of the following:
187     (A)  The experience modification is below 1.00.
188     (B)  The employer had no lost-time claims subsequent to the
189applicable experience modification rating period.
190     (C)  The total of the employer's medical-only claims
191subsequent to the applicable experience modification rating
192period did not exceed 20 percent of premium.
193     (II)  Criteria; non-rated employers.--An employer that does
194not have an experience modification rating shall be included in
195Tier One if the employer meets all of the following:
196     (A)  The employer had no lost-time claims for the 3-year
197period immediately preceding the inception date or renewal date
198of the employer's coverage under the plan.
199     (B)  The total of the employer's medical-only claims for
200the 3-year period immediately preceding the inception date or
201renewal date of the employer's coverage under the plan did not
202exceed 20 percent of premium.
203     (C)  The employer has secured workers' compensation
204coverage for the entire 3-year period immediately preceding the
205inception date or renewal date of the employer's coverage under
206the plan.
207     (D)  The employer is able to provide the plan with a loss
208history generated by the employer's prior workers' compensation
209insurer, except if the employer is not able to produce a loss
210history due to the insolvency of an insurer, the receiver shall
211provide to the plan, upon the request of the employer or the
212employer's agent, a copy of the employer's loss history from the
213records of the insolvent insurer if the loss history is
214contained in records of the insurer which are in the possession
215of the receiver. If the receiver is unable to produce the loss
216history, the employer may, in lieu of the loss history, submit
217an affidavit from the employer and the employer's insurance
218agent setting forth the loss history.
219     (E)  The employer is not a new business.
220     (III)  Premiums.--The premiums for Tier One insureds shall
221be set at a premium level 25 percent above the comparable
222voluntary market premiums until the plan has sufficient
223experience as determined by the board to establish an
224actuarially sound rate for Tier One, at which point the board
225shall, subject to paragraph (e), adjust the rates, if necessary,
226to produce actuarially sound rates, provided such rate
227adjustment shall not take effect prior to January 1, 2007.
228Subplan "A" must include those insureds whose annual premium
229does not exceed $2,500 and who have neither incurred any lost-
230time claims nor incurred medical-only claims exceeding 50
231percent of their premium for the immediate 2 years.
232     b.  Tier Two.--
233     (I)  Criteria; rated employers.--An employer that has an
234experience modification rating shall be included in Tier Two if
235the employer meets all of the following:
236     (A)  The experience modification is equal to or greater
237than 1.00 but not greater than 1.10.
238     (B)  The employer had no lost-time claims subsequent to the
239applicable experience modification rating period.
240     (C)  The total of the employer's medical-only claims
241subsequent to the applicable experience modification rating
242period did not exceed 20 percent of premium.
243     (II)  Criteria; non-rated employers.--An employer that does
244not have any experience modification rating shall be included in
245Tier Two if the employer is a new business. An employer shall be
246included in Tier Two if the employer has less than 3 years of
247loss experience in the 3-year period immediately preceding the
248inception date or renewal date of the employer's coverage under
249the plan and the employer meets all of the following:
250     (A)  The employer had no lost-time claims for the 3-year
251period immediately preceding the inception date or renewal date
252of the employer's coverage under the plan.
253     (B)  The total of the employer's medical-only claims for
254the 3-year period immediately preceding the inception date or
255renewal date of the employer's coverage under the plan did not
256exceed 20 percent of premium.
257     (C)  The employer is able to provide the plan with a loss
258history generated by the workers' compensation insurer that
259provided coverage for the portion or portions of such period
260during which the employer had secured workers' compensation
261coverage, except if the employer is not able to produce a loss
262history due to the insolvency of an insurer, the receiver shall
263provide to the plan, upon the request of the employer or the
264employer's agent, a copy of the employer's loss history from the
265records of the insolvent insurer if the loss history is
266contained in records of the insurer which are in the possession
267of the receiver. If the receiver is unable to produce the loss
268history, the employer may, in lieu of the loss history, submit
269an affidavit from the employer and the employer's insurance
270agent setting forth the loss history.
271     (III)  Premiums.--The premiums for Tier Two insureds shall
272be set at a rate level 50 percent above the comparable voluntary
273market premiums until the plan has sufficient experience as
274determined by the board to establish an actuarially sound rate
275for Tier Two, at which point the board shall, subject to
276paragraph (e), adjust the rates, if necessary, to produce
277actuarially sound rates, provided such rate adjustment shall not
278take effect prior to January 1, 2007.
279     (IV)  Assigned Risk Adjustment Program.--Employers assigned
280to Tier Two shall be subject to the Assigned Risk Adjustment
281Program, as applicable. Subplan "B" must include insureds that
282are employers identified by the board of governors as high-risk
283employers due solely to the nature of the operations being
284performed by those insureds and for whom no market exists in the
285voluntary market, and whose experience modifications are less
286than 1.00.
287     c.  Tier Three.--
288     (I)  Eligibility.--An employer shall be included in Tier
289Three if the employer does not meet the criteria for Tier One or
290Tier Two.
291     (II)  Rates.--The board shall establish, subject to
292paragraph (e), and the plan shall charge, actuarially sound
293rates for Tier Three insureds.
294     (III)  Assigned Risk Adjustment Program.--Employers
295assigned to Tier Three shall be subject to the Assigned Risk
296Adjustment Program, as applicable. Subplan "C" must include all
297insureds within the plan that are not eligible for subplan "A,"
298subplan "B," or subplan "D."
299     d.  Subplan "D" must include any employer, regardless of
300the length of time for which it has conducted business
301operations, which has an experience modification factor of 1.10
302or less and either employs 15 or fewer employees or is an
303organization that is exempt from federal income tax pursuant to
304s. 501(c)(3) of the Internal Revenue Code and receives more than
30550 percent of its funding from gifts, grants, endowments, or
306federal or state contracts. The rate plan for subplan "D" shall
307be the same rate plan as the plan approved under ss. 627.091-
308627.151, and each participant in subplan "D" shall pay the
309premium determined under such rate plan, plus a surcharge
310determined by the board to be sufficient to ensure that the plan
311does not compete with the voluntary market rate for any
312participant, but not to exceed 25 percent. However, the
313surcharge shall not exceed 10 percent for an organization that
314is exempt from federal income tax pursuant to s. 501(c)(3) of
315the Internal Revenue Code.
316     23.  For Tier One or Tier Two employers in construction
317class codes which employ no nonexempt employees or which report
318payroll that is insufficient to develop premiums in excess of
319$2,500, establish premiums of $2,500, which shall be in addition
320to the fee specified in subparagraph 26. When the board
321establishes actuarially sound rates for Tier One and Tier Two,
322the board shall also establish actuarially sound rates for
323minimum premium policies in those tiers.
324     24.23.  Provide for a depopulation program to reduce the
325number of insureds in the plan subplan "D." If an employer
326insured through the plan subplan "D" is offered coverage from a
327voluntary market carrier:
328     a.  During the first 30 days of coverage under the plan
329subplan;
330     b.  Before a policy is issued under the plan subplan;
331     c.  By issuance of a policy upon expiration or cancellation
332of the policy under the plan subplan; or
333     d.  By assumption of the plan's subplan's obligation with
334respect to an in-force policy,
335
336that employer is no longer eligible for coverage through the
337plan. The premium for risks assumed by the voluntary market
338carrier must be the same premium plus, for the first 2 years,
339the surcharge as the insured would have paid under the plan, and
340shall be adjusted upon renewal to reflect changes in the plan
341rates and the tier for which the insured would qualify as of the
342time of renewal. Such premium change shall occur upon renewal,
343but in no event more than once annually determined in sub-
344subparagraph 22.d. A premium under this subparagraph, including
345surcharge, is deemed approved and is not an excess premium for
346purposes of s. 627.171.
347     25.24.  Require that policies issued under subplan "D" and
348applications for such policies must include a notice that the
349policy issued under subplan "D" could be replaced by a policy
350issued from a voluntary market carrier and that, if an offer of
351coverage is obtained from a voluntary market carrier, the
352policyholder is no longer eligible for coverage through the plan
353subplan "D." The notice must also specify that acceptance of
354coverage under the plan subplan "D" creates a conclusive
355presumption that the applicant or policyholder is aware of this
356potential.
357     26.  Require that each application for coverage and each
358renewal premium be accompanied by a nonrefundable fee of $475 to
359cover costs of administration and fraud prevention. The board
360may, with the approval of the office, increase the amount of the
361fee pursuant to a rate filing to reflect increased costs of
362administration and fraud prevention. The fee is not subject to
363commission and is fully earned upon commencement of coverage.
364     (d)1.  The funding of the plan shall include premiums as
365provided in subparagraph (c)22. and assessments as provided in
366this paragraph. The plan must be funded through actuarially
367sound premiums charged to insureds of the plan.
368     2.a.  If the board determines that a deficit exists in Tier
369One or Tier Two or that there is any deficit remaining
370attributable to any of the plan's former subplans and that the
371deficit cannot be funded without the use of deficit assessments,
372the board shall request the office to levy, by order, a deficit
373assessment against premiums charged to insureds for workers'
374compensation insurance by insurers as defined in s. 631.904(5).
375The office shall issue the order after verifying the amount of
376the deficit. The assessment shall be specified as a percentage
377of future premium collections, as recommended by the board and
378approved by the office. The same percentage shall apply to
379premiums on all workers' compensation policies issued or renewed
380during the 12-month period beginning on the effective date of
381the assessment, as specified in the order.
382     b.  With respect to each insurer collecting premiums that
383are subject to the assessment, the insurer shall collect the
384assessment at the same time as the insurer collects the premium
385payment for each policy and shall remit the assessments
386collected to the plan as provided in the order issued by the
387office. The office shall verify the accurate and timely
388collection and remittance of deficit assessments and shall
389report such information to the board. Each insurer collecting
390assessments shall provide such information with respect to
391premiums and collections as may be required by the office to
392enable the office to monitor and audit compliance with this
393paragraph.
394     c.  Deficit assessments are not considered part of an
395insurer's rate, are not premium, and are not subject to the
396premium tax, to the assessments under ss. 440.49 and 440.51, to
397the surplus lines tax, to any fees, or to any commissions. The
398deficit assessment imposed shall become plan funds at the moment
399of collection and shall not constitute income to the insurer for
400any purpose, including financial reporting on the insurer's
401income statement. An insurer is liable for all assessments that
402the insurer collects and must treat the failure of an insured to
403pay an assessment as a failure to pay premium. An insurer is not
404liable for uncollectible assessments.
405     d.  When an insurer is required to return unearned premium,
406the insurer shall also return any collected assessments
407attributable to the unearned premium. The plan may issue
408assessable policies only to those insureds in subplans "C" and
409"D." Subject to verification by the department, the board may
410levy assessments against insureds in subplan "C" or subplan "D,"
411on a pro rata earned premium basis, to fund any deficits that
412exist in those subplans. Assessments levied against subplan "C"
413participants shall cover only the deficits attributable to
414subplan "C," and assessments levied against subplan "D"
415participants shall cover only the deficits attributable to
416subplan "D." In no event may the plan levy assessments against
417any person or entity, except as authorized by this paragraph.
418Those assessable policies must be clearly identified as
419assessable by containing, in contrasting color and in not less
420than 10-point type, the following statements: "This is an
421assessable policy. If the plan is unable to pay its obligations,
422policyholders will be required to contribute on a pro rata
423earned premium basis the money necessary to meet any assessment
424levied."
425     3.a.  All policies issued to Tier Three insureds shall be
426assessable. All Tier Three assessable policies must be clearly
427identified as assessable by containing, in contrasting color and
428in not less than 10-point type, the following statement:
429
430"This is an assessable policy. If the plan is unable to
431pay its obligations, policyholders will be required to
432contribute on a pro rata earned premium basis the money
433necessary to meet any assessment levied."
434
435     b.  The board may from time to time assess Tier Three
436insureds to whom the plan has issued assessable policies for the
437purpose of funding plan deficits. Any such assessment shall be
438based upon a reasonable actuarial estimate of the amount of the
439deficit, taking into account the amount needed to fund medical
440and indemnity reserves and reserves for incurred but not
441reported claims, and allowing for general administrative
442expenses, the cost of levying and collecting the assessment, a
443reasonable allowance for estimated uncollectible assessments,
444and allocated and unallocated loss adjustment expenses.
445     c.  Each Tier Three insured's share of a deficit shall be
446computed by applying to the premium earned on the insured's
447policy or policies during the period to be covered by the
448assessment the ratio of the total deficit to the total premiums
449earned during such period upon all policies subject to the
450assessment. If one or more Tier Three insureds fail to pay an
451assessment, the other Tier Three insureds shall be liable on a
452proportionate basis for additional assessments to fund the
453deficit. The plan may compromise and settle individual
454assessment claims without affecting the validity of or amounts
455due on assessments levied against other insureds. The plan may
456offer and accept discounted payments for assessments which are
457promptly paid. The plan may offset the amount of any unpaid
458assessment against unearned premiums which may otherwise be due
459to an insured. The plan shall institute legal action when
460necessary and appropriate to collect the assessment from any
461insured who fails to pay an assessment when due.
462     d.  The venue of a proceeding to enforce or collect an
463assessment or to contest the validity or amount of an assessment
464shall be in the Circuit Court of Leon County.
465     e.  If the board finds that a deficit in Tier Three exists
466for any period and that an assessment is necessary, the board
467shall certify to the office the need for an assessment. No
468sooner than 30 days after the date of such certification, the
469board shall notify in writing each insured who is to be assessed
470that an assessment is being levied against the insured, and
471informing the insured of the amount of the assessment, the
472period for which the assessment is being levied, and the date by
473which payment of the assessment is due. The board shall
474establish a date by which payment of the assessment is due,
475which shall be no sooner than 30 days nor later than 120 days
476after the date on which notice of the assessment is mailed to
477the insured.
478     f.  Whenever the board makes a determination that the plan
479does not have a sufficient cash basis to meet 3 months of
480projected cash needs due to a deficit in Tier Three, the board
481may request the department to transfer funds from the Workers'
482Compensation Administration Trust Fund to the plan in an amount
483sufficient to fund the difference between the amount available
484and the amount needed to meet a 3-month projected cash need as
485determined by the board and verified by the office, subject to
486the approval of the Legislative Budget Commission. If the
487Legislative Budget Commission approves a transfer of funds under
488this sub-subparagraph, the plan shall report to the Legislature
489the transfer of funds and the Legislature shall review the plan
490during the next legislative session or the current legislative
491session, if the transfer occurs during a legislative session.
492This sub-subparagraph shall not apply until the plan determines
493and the office verifies that assessments collected by the plan
494pursuant to sub-subparagraph b. are insufficient to fund the
495deficit in Tier Three and to meet 3 months of projected cash
496needs. The plan may issue assessable policies with differing
497terms and conditions to different groups within subplans "C" and
498"D" when a reasonable basis exists for the differentiation.
499     4.  The plan may offer rating, dividend plans, and other
500plans to encourage loss prevention programs.
501     (e)  The plan shall establish and use its rates and rating
502plans, and the plan may establish and use changes in rating
503plans at any time, but no more frequently than two times per any
504rating class for any calendar year. By December 1, 1993, and
505December 1 of each year thereafter, except as provided in
506subparagraph (c)22., the board shall establish and use
507actuarially sound rates for use by the plan to assure that the
508plan is self-funding while those rates are in effect. Such rates
509and rating plans must be filed with the office within 30
510calendar days after their effective dates, and shall be
511considered a "use and file" filing. Any disapproval by the
512office must have an effective date that is at least 60 days from
513the date of disapproval of the rates and rating plan and must
514have prospective effect only. The plan may not be subject to any
515order by the office to return to policyholders any portion of
516the rates disapproved by the office. The office may not
517disapprove any rates or rating plans unless it demonstrates that
518such rates and rating plans are excessive, inadequate, or
519unfairly discriminatory.
520     (g)  Whenever a deficit exists, the plan shall, within 90
521days, provide the office with a program to eliminate the deficit
522within a reasonable time. The deficit may be funded through
523increased premiums charged to insureds of the plan for
524subsequent years, through the use of policyholder surplus
525attributable to any year, through the use of assessments as
526provided in subparagraph (d)2., and through assessments on
527insureds in the plan if the plan uses assessable policies as
528provided in subparagraph (d)3.
529     (p)  No insurer shall provide workers' compensation and
530employer's liability insurance to any person who is delinquent
531in the payment of premiums, assessments, penalties, or
532surcharges owed to the plan or to any person who is an
533affiliated person of a person who is delinquent in the payment
534of premiums, assessments, penalties, or surcharges owed to the
535plan. For purposes of this paragraph, the term "affiliated
536person" of another person means:
537     1.  The spouse of such other natural person;
538     2.  Any person who directly or indirectly owns or controls,
539or holds with the power to vote, 5 percent or more of the
540outstanding voting securities of such other person;
541     3.  Any person who directly or indirectly owns 5 percent or
542more of the outstanding voting securities that are directly or
543indirectly owned or controlled, or held with the power to vote,
544by such other person;
545     4.  Any person or group of persons who directly or
546indirectly control, are controlled by, or are under common
547control with such other person;
548     5.  Any officer, director, trustee, partner, owner,
549manager, joint venturer, or employee, or other person performing
550duties similar to persons in those positions, of such other
551persons; or
552     6.  Any person who has an officer, director, trustee,
553partner, or joint venturer in common with such other person.
554     (q)  Effective July 1, 2004, the plan is exempt from the
555premium tax under s. 624.509 and any assessments under ss.
556440.49 and 440.51.
557     Section 2.  Notwithstanding the provisions of ss. 440.50
558and 440.51, Florida Statutes, for the 2004-2005 fiscal year the
559sum of $25 million is appropriated from the Workers'
560Compensation Administration Trust Fund in the Department of
561Financial Services for transfer to the workers' compensation
562joint underwriting plan provided in s. 627.311(5), Florida
563Statutes, as a capital contribution to fund any deficit in the
564plan. The Chief Financial Officer shall transfer such funds to
565the plan no later than July 31, 2004. An additional amount not
566to exceed $10 million is appropriated from the Workers'
567Compensation Administration Trust Fund for transfer to the
568workers' compensation joint underwriting plan provided in s.
569627.311(5), Florida Statutes, subject to the approval of the
570Legislative Budget Commission, if the Board of Governors and the
571Office of Insurance Regulation determine that a deficit exists
572in Tier One or Tier Two or that there is any deficit remaining
573attributable to the former Subplan "D" under former s.
574627.311(5)(c)22., Florida Statutes, and that the deficit cannot
575be funded without the use of deficit assessments as authorized
576by s. 627.351(5)(d), Florida Statutes.
577     Section 3.  Except as otherwise provided herein, this act
578shall take effect July 1, 2004.


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