Senate Bill sb2696c1

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    Florida Senate - 2004                           CS for SB 2696

    By the Committee on Banking and Insurance; and Senator Atwater





    311-2307-04

  1                      A bill to be entitled

  2         An act relating to insurance; creating s.

  3         255.0517, F.S.; defining terms; limiting the

  4         authority of certain public agencies to

  5         purchase owner-controlled insurance programs

  6         for public construction projects; establishing

  7         purchase requirements; providing exemptions;

  8         creating s. 627.441, F.S.; defining terms;

  9         requiring insurers issuing commercial general

10         liability policies to offer coverage for

11         completed operations liability for certain

12         contractors to the extent that coverage is not

13         provided under an owner-controlled insurance

14         program; providing an effective date.

15  

16  Be It Enacted by the Legislature of the State of Florida:

17  

18         Section 1.  Section 255.0517, Florida Statutes, is

19  created to read:

20         255.0517  Owner-controlled insurance programs for

21  public construction projects.--

22         (1)  DEFINITIONS.--As used in this section, the term:

23         (a)  "Owner-controlled insurance program" means a

24  consolidated insurance program or series of insurance policies

25  issued to a public agency that may provide one or more of the

26  following types of insurance coverage for any contractor or

27  subcontractor working at specified or multiple contracted work

28  sites of a public construction project: general liability,

29  property damage, workers' compensation, employer's liability,

30  builder's risk, or pollution liability coverage.

31  

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    Florida Senate - 2004                           CS for SB 2696
    311-2307-04




 1         (b)  "Specified contracted work site" means

 2  construction being performed during one or more fiscal years

 3  at one site or a series of contiguous sites separated only by

 4  a street, roadway, waterway, or railroad right-of-way or along

 5  a continuous system for the provision for water and power.

 6         (c)  "Multiple contracted work site" means construction

 7  being performed at multiple sites during one or more fiscal

 8  years that is part of an ongoing capital infrastructure

 9  improvement program or involves the construction of one or

10  more public schools.

11         (2)  PURCHASE REQUIREMENTS.--A state agency, political

12  subdivision, state university, community college, airport

13  authority, or other public agency in this state, or any

14  instrumentality thereof, may only purchase an owner-controlled

15  insurance program in connection with a public construction

16  project if it is determined necessary and in the best interest

17  of the public agency and if all of the following conditions

18  are met:

19         (a)  The estimated total cost of the project is:

20         1.  Seventy-five million dollars or more;

21         2.  Thirty million dollars or more, if the project is

22  for the construction or renovation of two or more public

23  schools during a fiscal year; or

24         3.  Ten million dollars or more, if the project is for

25  the construction or renovation of one public school,

26  regardless of whether the project's duration extends beyond a

27  fiscal year.

28         (b)  The program maintains completed operations

29  insurance coverage for a term during which the coverage is

30  reasonably commercially available, as determined by the public

31  agency, but for no less than 5 years.

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    Florida Senate - 2004                           CS for SB 2696
    311-2307-04




 1         (c)  The bid or proposal specifications for the project

 2  clearly specify, for all bidders or proposers, the insurance

 3  coverage provided under the program and the minimum safety

 4  requirements that must be met.

 5         (d)  The program does not prohibit a contractor or

 6  subcontractor from purchasing any additional insurance

 7  coverage that the contractor or subcontractor believes is

 8  necessary for protection against any liability arising out of

 9  the contract. The cost of the additional insurance must be

10  disclosed to the public agency.

11         (e)  The program does not include surety insurance.

12         (f)  The public agency may only purchase an

13  owner-controlled insurance policy that has a deductible or

14  self-insured retention if the deductible or self-insured

15  retention does not exceed $1 million per occurrence.

16         (g)  The public agency is responsible for payment of

17  the applicable deductibles of all claims.

18         (3)  EXEMPTIONS.--This section does not apply to the

19  following projects:

20         (a)  Any project of the Department of Transportation

21  which is authorized under s. 337.11;

22         (b)  Any existing project or projects of a public

23  agency which are the subject of an ongoing, owner-controlled

24  insurance program issued before October 1, 2004; or

25         (c)  Any project of a public agency which is advertised

26  by the public agency before October 1, 2004, for the purpose

27  of receiving bids or proposals for the project.

28         Section 2.  Section 627.441, Florida Statutes, is

29  created to read:

30         627.441  Commercial general liability policies;

31  coverage to contractors for completed operations.--

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    Florida Senate - 2004                           CS for SB 2696
    311-2307-04




 1         (1)  As used in this section, the term:

 2         (a)  "Contractor" means a contractor or subcontractor

 3  performing work on a public construction project under

 4  contract with a public agency, as described in s. 255.0517(2).

 5         (b)  "Liability insurer" means an insurer issuing a

 6  commercial general liability insurance policy in this state to

 7  a contractor that provides coverage for liability arising out

 8  of completed operations performed by the contractor or on the

 9  contractor's behalf.

10         (2)  A liability insurer must offer coverage at an

11  appropriate additional premium for liability arising out of

12  current or completed operations under an owner-controlled

13  insurance program for any period beyond the period for which

14  the program provides liability coverage, as specified in s.

15  255.0517(2)(b). The period of such coverage must be sufficient

16  to protect against liability arising out of an action brought

17  within the time limits provided in s. 95.11(3)(c).

18         Section 3.  This act shall take effect October 1, 2004.

19  

20          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
21                         Senate Bill 2696

22                                 

23  Exempts architects and engineers from the provisions of the
    bill.
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