SENATE AMENDMENT
    Bill No. HB 1433, 1st Eng.
    Amendment No. ___   Barcode 780684
                            CHAMBER ACTION
              Senate                               House
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       03/31/2004 10:23 AM         .                    
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11  Senator Bennett moved the following amendment:
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13         Senate Amendment (with title amendment) 
14         Line 48 through Line 172, delete those lines
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16  and insert:  
17         Section 2.  Subsection (5) is added to section 634.271,
18  Florida Statutes, to read:
19         634.271  Civil remedy.--
20         (5)  The penalty provisions in ss. 520.12 and 521.006,
21  as well as the statutory penalty minimum recovery of $500 in
22  subsection (1), do not apply to any violation of this part or
23  chapters 520 and 521 relating to or in connection with the
24  issuance, purchase, or sale, before April 23, 2002, of a
25  vehicle protection product or contract, agreement, or product
26  that provides for payment of vehicle protection expenses as
27  defined in s. 634.011.
28         Section 3.  Section 634.3205, Florida Statutes, is
29  created to read:
30         634.3205  Rebating; when allowed.--
31         (1)  No sales representative shall rebate any portion
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SENATE AMENDMENT Bill No. HB 1433, 1st Eng. Amendment No. ___ Barcode 780684 1 of his or her commission except as follows: 2 (a) The rebate shall be available to all consumers in 3 the same actuarial class. 4 (b) The rebate shall be in accordance with a rebating 5 schedule filed by the sales representative with the home 6 warranty association issuing the home warranty to which the 7 rebate applies. The home warranty association shall maintain a 8 copy of all rebating schedules for a period of 3 years. 9 (c) The rebating schedule shall be uniformly applied 10 in that all consumers who purchase the same home warranty 11 through the sales representative for the same coverage receive 12 the same percentage rebate. 13 (d) The rebate schedule is prominently displayed in 14 public view in the sales representative's place of doing 15 business and a copy is available to consumers on request at no 16 charge. 17 (e) The age, sex, place of residence, race, 18 nationality, ethnic origin, marital status, or occupation of 19 the consumer is not used in determining the percentage of the 20 rebate or whether a rebate is available. 21 (2) No rebate shall be withheld or limited in amount 22 based on factors that are unfairly discriminatory. 23 (3) No rebate shall be given which is not reflected on 24 the rebate schedule. 25 (4) No rebate shall be refused or granted based upon 26 the purchase or failure to purchase collateral business. 27 Section 4. Subsection (8) is added to section 634.406, 28 Florida Statutes, to read: 29 634.406 Financial requirements.-- 30 (8) An association licensed under this part, and 31 holding no other license under part I or part II of chapter 2 4:18 PM 03/24/04 h1433c-21s27
SENATE AMENDMENT Bill No. HB 1433, 1st Eng. Amendment No. ___ Barcode 780684 1 634, is not required to establish an unearned premium reserve 2 or maintain contractual liability insurance and may allow its 3 premiums to exceed the ratio to net assets limitation of this 4 section if the association complies with the following: 5 (a) The association or, if the association is a direct 6 or indirect wholly owned subsidiary of a parent corporation, 7 its parent corporation has, and maintains at all times, a 8 minimum net worth of at least $100 million and provides the 9 office with the following: 10 1. A copy of the association's annual audited 11 financial statements or the audited consolidated financial 12 statements of the association's parent, prepared by an 13 independent certified public accountant in accordance with 14 generally accepted accounting principles, which clearly 15 demonstrate the net worth of the association or its parent 16 corporation to be $100 million and a quarterly written 17 certification to the office that such entity continues to 18 maintain the net worth required under this paragraph; and 19 2. The association's or its parent corporation's Form 20 10-K, Form 10-Q, or Form 20-F as filed with the United States 21 Securities and Exchange Commission or such other documents as 22 are required to be filed with a recognized stock exchange, 23 which shall be provided on a quarterly and annual basis within 24 10 days after the last date each such report must be filed 25 with the Securities and Exchange Commission, the National 26 Association of Security Dealers Automated Quotation system, or 27 other recognized stock exchange. 28 29 Failure to timely file the documents required under this 30 paragraph may, at the discretion of the office, subject the 31 association to suspension or revocation of its license under 3 4:18 PM 03/24/04 h1433c-21s27
SENATE AMENDMENT Bill No. HB 1433, 1st Eng. Amendment No. ___ Barcode 780684 1 this part. An association or parent corporation demonstrating 2 compliance with subparagraph 1. and subparagraph 2. must 3 maintain outstanding debt obligations, if any, rated in the 4 top four rating categories by a recognized rating service. 5 (b) If the net worth of a parent corporation is used 6 to satisfy the net worth provisions of paragraph (a), the 7 following provisions must be met: 8 1. The parent corporation must guarantee all service 9 warranty obligations of the association, wherever written, on 10 a form approved in advance by the office. No cancellation, 11 termination, or modification of the guarantee shall become 12 effective unless the parent corporation provides the office 13 written notice at least 90 days before the effective date of 14 the cancellation, termination, or modification and the office 15 approves the request in writing. Prior to the effective date 16 of cancellation, termination, or modification of the 17 guarantee, the association must demonstrate to the 18 satisfaction of the office compliance with all applicable 19 provisions of this part, including whether the association 20 will meet the requirements of this section by the purchase of 21 contractual liability insurance, establishing required 22 reserves, or other method allowed under this section. If the 23 association or parent corporation does not demonstrate to the 24 satisfaction of the office compliance with all applicable 25 provisions of this part, it shall immediately cease writing 26 new and renewal business upon the effective date of the 27 cancellation, termination, or modification. 28 2. The service warranty association must maintain at 29 all times net assets of at least $750,000. 30 Section 5. Section 634.4225, Florida Statutes, is 31 created to read: 4 4:18 PM 03/24/04 h1433c-21s27
SENATE AMENDMENT Bill No. HB 1433, 1st Eng. Amendment No. ___ Barcode 780684 1 634.4225 Rebating; when allowed.-- 2 (1) No sales representative shall rebate any portion 3 of his or her commission except as follows: 4 (a) The rebate shall be available to all consumers in 5 the same actuarial class. 6 (b) The rebate shall be in accordance with a rebating 7 schedule filed by the sales representative with the 8 association issuing the service warranty to which the rebate 9 applies. The association shall maintain a copy of all rebating 10 schedules for a period of 3 years. 11 (c) The rebating schedule shall be uniformly applied 12 in that all consumers who purchase the same service warranty 13 through the sales representative for the same coverage receive 14 the same percentage rebate. 15 (d) The rebate schedule is prominently displayed in 16 public view in the sales representative's place of doing 17 business and a copy is available to consumers on request at no 18 charge. 19 (e) The age, sex, place of residence, race, 20 nationality, ethnic origin, marital status, or occupation of 21 the consumer is not used in determing the percentage of the 22 rebate or whether a rebate is available. 23 (2) No rebate shall be withheld or limited in amount 24 on factors that are unfairly discriminatory. 25 (3) No rebate shall be given which is not reflected on 26 the rebate schedule. 27 (4) No rebate shall be refused or granted based upon 28 the purchase or failure to purchase collateral business. 29 Section 6. This act shall take effect upon becoming a 30 law and section 2 shall apply retroactively to January 1, 31 1998. 5 4:18 PM 03/24/04 h1433c-21s27
SENATE AMENDMENT Bill No. HB 1433, 1st Eng. Amendment No. ___ Barcode 780684 1 ================ T I T L E A M E N D M E N T =============== 2 And the title is amended as follows: 3 Line 5 through Line 14, delete those lines 4 5 and insert: 6 may rebate his or her commission; amending s. 7 634.271, F.S.; providing an exemption from 8 penalty provisions for certain service 9 warranties; creating s. 634.3205, F.S.; 10 providing conditions under which a sales 11 representative of a home warranty association 12 may rebate his or her commission; amending s. 13 634.406, F.S.; providing conditions under which 14 a service warranty association is exempt from 15 certain premium reserve and liability insurance 16 requirements and may allow premiums to exceed 17 certain limits; creating s. 634.4225, F.S.; 18 providing conditions under which a sales 19 representative of a service warranty 20 association may rebate his or her commission; 21 providing retroactive applicability; providing 22 an 23 24 25 26 27 28 29 30 31 6 4:18 PM 03/24/04 h1433c-21s27