| 1 | A bill to be entitled | 
| 2 | An act relating to insurers; amending s. 626.854, F.S.;  | 
| 3 | limiting the scope of a public adjuster?s authority;  | 
| 4 | requiring public adjusters to provide certain information  | 
| 5 | and make certain disclosures; prohibiting a public  | 
| 6 | adjuster from restricting access to certain entities and  | 
| 7 | communications with certain entities; requiring public  | 
| 8 | adjusters to submit certain recorded statements and sworn  | 
| 9 | examinations under certain circumstances; amending s.  | 
| 10 | 631.021, F.S.; authorizing certain domiciliary courts to  | 
| 11 | exercise exclusive jurisdiction over certain persons under  | 
| 12 | certain circumstances; specifying the Circuit Court of  | 
| 13 | Leon County as having exclusive jurisdiction over certain  | 
| 14 | proceedings and claims; amending s. 631.041, F.S.;  | 
| 15 | entitling the estates of certain injured insurers to  | 
| 16 | actual damages; authorizing a receivership court to impose  | 
| 17 | additional sanctions; amending s. 631.0515, F.S.;  | 
| 18 | subjecting certain managing general agents or holding  | 
| 19 | companies to court jurisdiction under certain  | 
| 20 | circumstances; amending s. 631.141, F.S.; specifying  | 
| 21 | certain expenses as administrative and recoverable by a  | 
| 22 | receiver in certain proceedings; amending s. 631.205,  | 
| 23 | F.S.; specifying that entry of certain orders does not  | 
| 24 | constitute anticipatory breach of certain contracts or  | 
| 25 | serve as grounds for certain adverse contract actions by a  | 
| 26 | reinsurer; creating s. 631.206, F.S.; voiding certain  | 
| 27 | contractual arbitration provisions by insurers in  | 
| 28 | receivership; specifying a replacement arbitration  | 
| 29 | provision; amending s. 631.261, F.S.; voiding certain  | 
| 30 | transfers or liens made by certain persons prior to  | 
| 31 | certain delinquency proceedings; specifying a criterion  | 
| 32 | for making certain transfers; amending ss. 631.262 and  | 
| 33 | 631.263, F.S.; specifying a criterion for making certain  | 
| 34 | transfers; creating s. 631.400, F.S.; requiring a receiver  | 
| 35 | to deposit certain estate funds of a liquidated insurance  | 
| 36 | company into a separate closed estate account under  | 
| 37 | certain circumstances; specifying use of such funds by the  | 
| 38 | Division of Rehabilitation and Liquidation of the  | 
| 39 | Department of Financial Services for certain purposes;  | 
| 40 | specifying nonreversion of certain funds to the state but  | 
| 41 | retention for certain uses; providing an effective date. | 
| 42 | 
  | 
| 43 | Be It Enacted by the Legislature of the State of Florida: | 
| 44 | 
  | 
| 45 |      Section 1.  Section 626.854, Florida Statutes, is amended  | 
| 46 | to read: | 
| 47 |      626.854  "Public adjuster" defined; prohibitions;  | 
| 48 | disclosure requirements.--The Legislature finds that it is  | 
| 49 | necessary for the protection of the public to regulate public  | 
| 50 | insurance adjusters and to prevent the unauthorized practice of  | 
| 51 | law. | 
| 52 |      (1)  A "public adjuster" is any person, except a duly  | 
| 53 | licensed attorney at law as hereinafter in s. 626.860 provided,  | 
| 54 | who, for money, commission, or any other thing of value,  | 
| 55 | prepares, completes, or files an insurance claim form for an  | 
| 56 | insured or third-party claimant or who, for money, commission,  | 
| 57 | or any other thing of value, acts or aids in any manner on  | 
| 58 | behalf of an insured or third-party claimant in negotiating for  | 
| 59 | or effecting the settlement of a claim or claims for loss or  | 
| 60 | damage covered by an insurance contract or who advertises for  | 
| 61 | employment as an adjuster of such claims, and also includes any  | 
| 62 | person who, for money, commission, or any other thing of value,  | 
| 63 | solicits, investigates, or adjusts such claims on behalf of any  | 
| 64 | such public adjuster. | 
| 65 |      (2)  This definition does not apply to: | 
| 66 |      (a)  A licensed health care provider or employee thereof  | 
| 67 | who prepares or files a health insurance claim form on behalf of  | 
| 68 | a patient. | 
| 69 |      (b)  A person who files a health claim on behalf of another  | 
| 70 | and does so without compensation. | 
| 71 |      (3)(a)  A public adjuster may not give legal advice. A  | 
| 72 | public adjuster may not act on behalf of or aid any person in  | 
| 73 | negotiating or settling a claim relating to bodily injury,  | 
| 74 | death, or noneconomic damages, or issues relating to extra- | 
| 75 | contractual damages, violations of part IX, tort claims,  | 
| 76 | statutory interest, or costs and attorney?s fees. | 
| 77 |      (b)  A public adjuster must provide to the insurer and its  | 
| 78 | representatives, together with the notice of representation, a  | 
| 79 | complete copy of any contract between the public adjuster and  | 
| 80 | the insured or claimant. The public adjuster must also provide  | 
| 81 | the insurer and its representatives with a copy of any amended,  | 
| 82 | revised, or supplemental contract entered into at any point  | 
| 83 | during the claims handling process immediately upon entering  | 
| 84 | into such amended, revised, or supplemental contract.  | 
| 85 | Disclosures under this paragraph shall be in a form specified by  | 
| 86 | rule of the Financial Services Commission. | 
| 87 |      (c)  A public adjuster must disclose to his or her client  | 
| 88 | and to the insurer any direct or indirect interest the public  | 
| 89 | adjuster may have, and any compensation, referral fee, or other  | 
| 90 | consideration the public adjuster may receive from any person  | 
| 91 | performing services in connection with the adjustment of a claim  | 
| 92 | or the repair or replacement of insured property. | 
| 93 |      (d)  A public adjuster may not at any time restrict access  | 
| 94 | to an insured, a claimant, or insured property by an insurer,  | 
| 95 | company adjuster, independent adjuster, attorney, or other  | 
| 96 | person acting on behalf of the insurer. | 
| 97 |      (e)  A public adjuster may not, in connection with any  | 
| 98 | claim, refuse to speak with an insurer, company adjuster,  | 
| 99 | independent adjuster, attorney, or other person acting on behalf  | 
| 100 | of the insurer. A public adjuster shall provide a recorded  | 
| 101 | statement and an examination under oath upon request of an  | 
| 102 | insurer, company adjuster, independent adjuster, attorney, or  | 
| 103 | other person acting on behalf of the insurer. | 
| 104 |      (4)  For purposes of this section, the term "insured"  | 
| 105 | includes only the policyholder and any beneficiaries named or  | 
| 106 | similarly identified in the policy. | 
| 107 |      Section 2.  Subsection (6) is added to section 631.021,  | 
| 108 | Florida Statutes, to read: | 
| 109 |      631.021  Jurisdiction of delinquency proceeding; venue;  | 
| 110 | change of venue; exclusiveness of remedy; appeal.-- | 
| 111 |      (6)  The domiciliary court acquiring jurisdiction over  | 
| 112 | persons subject to this section may exercise exclusive  | 
| 113 | jurisdiction to the exclusion of all other courts, except as  | 
| 114 | limited by the provisions of this section. Upon the issuance of  | 
| 115 | an order of conservation, rehabilitation, or liquidation, the  | 
| 116 | Circuit Court of Leon County shall have exclusive jurisdiction  | 
| 117 | with respect to assets or property of any insurer subject to  | 
| 118 | such proceedings and claims against said insurer's assets or  | 
| 119 | property. | 
| 120 |      Section 3.  Subsection (6) is added to section 631.041,  | 
| 121 | Florida Statutes, to read: | 
| 122 |      631.041  Automatic stay; relief from stay; injunctions.-- | 
| 123 |      (6)  The estate of an insurer in rehabilitation or  | 
| 124 | liquidation which is injured by any willful violation of an  | 
| 125 | applicable stay or injunction shall be entitled to actual  | 
| 126 | damages, including costs and attorney's fees, and, in  | 
| 127 | appropriate circumstances, the receivership court may impose  | 
| 128 | additional sanctions. | 
| 129 |      Section 4.  Section 631.0515, Florida Statutes, is amended  | 
| 130 | to read: | 
| 131 |      631.0515  Appointment of receiver; insurance holding  | 
| 132 | company.--A delinquency proceeding pursuant to this chapter  | 
| 133 | constitutes the sole and exclusive method of dissolving,  | 
| 134 | liquidating, rehabilitating, reorganizing, conserving, or  | 
| 135 | appointing a receiver of a Florida corporation which is not  | 
| 136 | insolvent as defined by s. 607.01401(16); which through its  | 
| 137 | shareholders, board of directors, or governing body is  | 
| 138 | deadlocked in the management of its affairs; and which directly  | 
| 139 | or indirectly owns all of the stock of a Florida domestic  | 
| 140 | insurer. The department may petition for an order directing it  | 
| 141 | to rehabilitate such corporation if the interests of  | 
| 142 | policyholders or the public will be harmed as a result of the  | 
| 143 | deadlock. The department shall use due diligence to resolve the  | 
| 144 | deadlock. Whether or not the department petitions for an order,  | 
| 145 | the circuit court shall not have jurisdiction pursuant to s.  | 
| 146 | 607.271, s. 607.274, or s. 607.277 to dissolve, liquidate, or  | 
| 147 | appoint receivers with respect to, a Florida corporation which  | 
| 148 | directly or indirectly owns all of the stock of a Florida  | 
| 149 | domestic insurer and which is not insolvent as defined by s.  | 
| 150 | 607.01401(16). However, a managing general agent or holding  | 
| 151 | company with a controlling interest in a domestic insurer in  | 
| 152 | this state is subject to jurisdiction of the court under the  | 
| 153 | provisions of s. 631.025. | 
| 154 |      Section 5.  Paragraph (a) of subsection (7) of section  | 
| 155 | 631.141, Florida Statutes, is amended to read: | 
| 156 |      631.141  Conduct of delinquency proceeding; domestic and  | 
| 157 | alien insurers.-- | 
| 158 |      (7)(a)  In connection with a delinquency proceeding, the  | 
| 159 | department may appoint one or more special agents to act for it,  | 
| 160 | and it may employ such counsel, clerks, and assistants as it  | 
| 161 | deems necessary. The compensation of the special agents,  | 
| 162 | counsel, clerks, or assistants and all expenses of taking  | 
| 163 | possession of the insurer and of conducting the proceeding shall  | 
| 164 | be fixed by the receiver, subject to the approval of the court,  | 
| 165 | and shall be paid out of the funds or assets of the insurer.  | 
| 166 | Such expenses are administrative expenses and are recoverable by  | 
| 167 | the receiver in any actions in which the receiver is authorized  | 
| 168 | or entitled to recover its administrative expenses. Within the  | 
| 169 | limits of duties imposed upon them, special agents shall possess  | 
| 170 | all the powers given to and, in the exercise of those powers,  | 
| 171 | shall be subject to all duties imposed upon the receiver with  | 
| 172 | respect to such proceeding. | 
| 173 |      Section 6.  Section 631.205, Florida Statutes, is amended  | 
| 174 | to read: | 
| 175 |      631.205  Reinsurance proceeds.--All reinsurance proceeds  | 
| 176 | payable under a contract of reinsurance to which the insolvent  | 
| 177 | insurer is a party are to be paid directly to the domiciliary  | 
| 178 | receiver as general assets of the receivership estate unless the  | 
| 179 | reinsurance contract contains a clause which specifically names  | 
| 180 | the insolvent insurer's insured as a direct beneficiary of the  | 
| 181 | reinsurance contract. The entry of an order of conservation,  | 
| 182 | rehabilitation, or liquidation shall not be deemed an  | 
| 183 | anticipatory breach of any reinsurance contract, nor shall it be  | 
| 184 | grounds for retroactive revocation or retroactive cancellation  | 
| 185 | of any reinsurance contracts by the reinsurer. | 
| 186 |      Section 7.  Section 631.206, Florida Statutes, is created  | 
| 187 | to read: | 
| 188 |      631.206  Arbitration.--If an insurer in receivership has  | 
| 189 | entered into an agreement containing an arbitration provision  | 
| 190 | for resolution of disputes, that provision is void and shall be  | 
| 191 | replaced by operation of law with the following provision: | 
| 192 | 
  | 
| 193 | Any controversy or claim arising out of or relating to  | 
| 194 | this contract, or the breach thereof, shall be settled  | 
| 195 | by arbitration pursuant to the American Arbitration  | 
| 196 | Association Commercial Arbitration Rules and chapter  | 
| 197 | 682, Florida Statutes, and judgment on the award  | 
| 198 | rendered by the arbitrators shall be entered by the  | 
| 199 | receivership court. Venue shall be in Leon County,  | 
| 200 | Florida. Disputes shall be submitted to a panel of  | 
| 201 | three arbitrators, one to be chosen by each party and  | 
| 202 | the third by the two so chosen. Arbitrators shall be  | 
| 203 | selected from a list of potential qualified  | 
| 204 | arbitrators with 10 years' experience involving the  | 
| 205 | insurance industry. If the parties do not agree upon  | 
| 206 | the qualifications of a mediator, each party shall  | 
| 207 | select its mediator from a list of potential mediators  | 
| 208 | approved by the receivership court. | 
| 209 | 
  | 
| 210 |      Section 8.  Subsection (1) of section 631.261, Florida  | 
| 211 | Statutes, is amended, and subsection (4) is added to said  | 
| 212 | section, to read: | 
| 213 |      631.261  Voidable transfers.-- | 
| 214 |      (1)(a)  Any transfer of, or lien upon, the property of an  | 
| 215 | insurer or affiliate which is made or created within 4 months  | 
| 216 | prior to the commencement of any delinquency proceeding under  | 
| 217 | this chapter which gives with the intent of giving to any  | 
| 218 | creditor of the insurer a preference or enables of enabling the  | 
| 219 | creditor to obtain a greater percentage of her or his debt than  | 
| 220 | any other creditor of the same class, and which is accepted by  | 
| 221 | such creditor having reasonable cause to believe that such  | 
| 222 | preference will occur, shall be voidable. | 
| 223 |      (b)  Any transfer of, or lien upon, the property of an  | 
| 224 | insurer or affiliate which is made or created between 4 months  | 
| 225 | and 1 year prior to the commencement of any delinquency  | 
| 226 | proceeding under this chapter is void if such transfer or lien  | 
| 227 | inured to the benefit of a director, officer, employee,  | 
| 228 | stockholder, member, subscriber, affiliate, managing general  | 
| 229 | agent, or insider or any relative of any director, officer,  | 
| 230 | employee, stockholder, member, subscriber, affiliate, managing  | 
| 231 | general agent, or insider. | 
| 232 |      (4)  For purposes of this section, a transfer is not made  | 
| 233 | or created until the insurer or affiliate has acquired rights in  | 
| 234 | the property transferred. | 
| 235 |      Section 9.  Paragraph (e) of subsection (2) of section  | 
| 236 | 631.262, Florida Statutes, is redesignated as paragraph (f) and  | 
| 237 | amended, and new paragraph (e) is added to said subsection, to  | 
| 238 | read: | 
| 239 |      631.262  Transfers prior to petition.-- | 
| 240 |      (2)  Transfers shall be deemed to have been made or  | 
| 241 | suffered, or obligations incurred, when perfected according to  | 
| 242 | the following criteria: | 
| 243 |      (a)  A transfer of property other than real property shall  | 
| 244 | be deemed to be made or suffered when it becomes so far  | 
| 245 | perfected that no subsequent lien obtainable by legal or  | 
| 246 | equitable proceedings on a simple contract could become superior  | 
| 247 | to the rights of the transferee.; | 
| 248 |      (b)  A transfer of real property shall be deemed to be made  | 
| 249 | or suffered when it becomes so far perfected that no subsequent  | 
| 250 | bona fide purchaser from the insurer could obtain rights  | 
| 251 | superior to the rights of the transferee.; | 
| 252 |      (c)  A transfer which creates an equitable lien shall not  | 
| 253 | be deemed to be perfected if there are available means by which  | 
| 254 | a legal lien could be created.; | 
| 255 |      (d)  Any transfer not perfected prior to the filing of a  | 
| 256 | petition in a delinquency proceeding shall be deemed to be made  | 
| 257 | immediately before the filing of a successful petition.; | 
| 258 |      (e)  For the purposes of this section, a transfer is not  | 
| 259 | made until the insurer or affiliate has acquired rights in the  | 
| 260 | property transferred. | 
| 261 |      (f)(e)  Paragraphs (a)-(e)(d) apply whether or not there  | 
| 262 | are or were creditors who might have obtained any liens or  | 
| 263 | persons who might have become bona fide purchasers. | 
| 264 |      Section 10.  Subsection (6) is added to section 631.263,  | 
| 265 | Florida Statutes, to read: | 
| 266 |      631.263  Transfers after petition.-- | 
| 267 |      (6)  For the purposes of this section, a transfer is not  | 
| 268 | made until the insurer or affiliate has acquired rights in the  | 
| 269 | property transferred. | 
| 270 |      Section 11.  Section 631.400, Florida Statutes, is created  | 
| 271 | to read: | 
| 272 |      631.400  Closed estate account.-- | 
| 273 |      (1)  If unclaimed funds remain in the estate of a liquidated  | 
| 274 | insurance company after the estate is closed or a receiver  | 
| 275 | recovers funds in an estate of a liquidated insurance company  | 
| 276 | after the estate is closed, the receiver shall deposit those  | 
| 277 | funds when received into a separate closed estate account. | 
| 278 |      (2)  Funds received and deposited in the account pursuant to  | 
| 279 | subsection (1) shall be used by the Division of Rehabilitation  | 
| 280 | and Liquidation of the Department of Financial Services to defray  | 
| 281 | the division?s expenses in the discharge of its duties as  | 
| 282 | prescribed by law, including the initiation of delinquency  | 
| 283 | proceedings and all other legitimate expenses relating to the  | 
| 284 | discharge of the duties imposed in and charged to the division. | 
| 285 |      (3)  If, at the end of any fiscal year, a balance of funds  | 
| 286 | remains in a closed estate account, such balance shall not  | 
| 287 | revert to the general fund of the state but shall be retained in  | 
| 288 | the closed estate account to be used for the purposes set forth  | 
| 289 | in subsection (2). | 
| 290 |      Section 12.  This act shall take effect upon becoming a  | 
| 291 | law. |