HB 0105

1
A bill to be entitled
2An act relating to life insurance and annuity contracts;
3amending s. 624.402, F.S.; providing that a certificate of
4authority is not required of insurers domiciled outside
5the United States for certain life insurance policies or
6annuity contracts covering only persons who are not
7residents of the United States and are not nonresidents
8illegally residing in the United States; providing
9criteria, requirements, and limitations; requiring the
10insurer to disclose certain information; providing for the
11Office of Insurance Regulation to determine when the
12insurer is no longer eligible for the exemption; providing
13an exemption from certain taxes; requiring life insurance
14applications and policies and annuity contracts to provide
15certain disclosure statements; specifying application of
16certain provisions to single-premium life insurance
17policies and single-premium annuity contracts issued to
18certain nonresidents; providing an effective date.
19
20Be It Enacted by the Legislature of the State of Florida:
21
22     Section 1.  Subsection (8) is added to section 624.402,
23Florida Statutes, to read:
24     624.402  Exceptions, certificate of authority required.--A
25certificate of authority shall not be required of an insurer
26with respect to:
27     (8)(a)  Life insurance policies or annuity contracts issued
28by an insurer domiciled outside the United States covering only
29persons who, at the time of issuance, are not residents of the
30United States and are not nonresidents illegally residing in the
31United States, provided:
32     1.  The insurer must currently be an authorized insurer in
33its country of domicile as to the kind or kinds of insurance
34proposed to be offered and must have been such an insurer for
35not fewer than the immediately preceding 3 years, or must be the
36wholly owned subsidiary of such authorized insurer or must be
37the wholly owned subsidiary of an already eligible authorized
38insurer as to the kind or kinds of insurance proposed for a
39period of not fewer than the immediately preceding 3 years.
40However, the office may waive the 3-year requirement if the
41insurer has operated successfully for a period of at least the
42immediately preceding year and has capital and surplus of not
43less than $25 million.
44     2.  Before the office may grant eligibility, the requesting
45insurer shall furnish the office with a duly authenticated copy
46of its current annual financial statement, in English, and with
47all monetary values therein expressed in United States dollars,
48at an exchange rate then current and shown in the statement, in
49the case of statements originally made in the currencies of
50other countries, and with such additional information relative
51to the insurer as the office may request.
52     3.  The insurer must have and maintain surplus as to
53policyholders of not less than $15 million. Any such surplus as
54to policyholders shall be represented by investments consisting
55of eligible investments for like funds of like domestic insurers
56under part II of chapter 625; however, any such surplus as to
57policyholders may be represented by investments permitted by the
58domestic regulator of such alien insurance company if such
59investments are substantially similar in terms of quality,
60liquidity, and security to eligible investments for like funds
61of like domestic insurers under part II of chapter 625.
62     4.  The insurer must be of good reputation as to the
63providing of service to its policyholders and the payment of
64losses and claims.
65     5.  To maintain eligibility, the insurer shall furnish the
66office within the time period specified in s. 624.424(1)(a) a
67duly authenticated copy of its current annual and quarterly
68financial statements, in English, and with all monetary values
69therein expressed in United States dollars, at an exchange rate
70then current and shown in the statement, in the case of
71statements originally made in the currencies of other countries,
72and with such additional information relative to the insurer as
73the office may request.
74     6.  An insurer receiving eligibility under this subsection
75shall agree to make its books and records pertaining to its
76operations in this state available for inspection during normal
77business hours upon request of the office.
78     7.  The insurer shall provide to the applicant for the
79policy or contract a copy of the most recent quarterly financial
80statements of the insurer providing, in clear and conspicuous
81language:
82     a.  The date of organization of the insurer.
83     b.  The identity of and rating assigned by each recognized
84insurance company rating organization that has rated the insurer
85or, if applicable, that the insurer is unrated.
86     c.  That the insurer does not hold a certificate of
87authority issued in this state and that the office does not
88exercise regulatory oversight over the insurer.
89     d.  The identity and address of the regulatory authority
90exercising oversight of the insurer.
91
92This paragraph does not impose upon the office any duty or
93responsibility to determine the actual financial condition or
94claims practices of any unauthorized insurer, and the status of
95eligibility, if granted by the office, indicates only that the
96insurer appears to be financially sound and to have satisfactory
97claims practices and that the office has no credible evidence to
98the contrary.
99     (b)  If at any time the office has reason to believe that
100an insurer issuing policies or contracts pursuant to this
101subsection is insolvent or is in unsound financial condition,
102does not make reasonable prompt payment of benefits, or is no
103longer eligible under the conditions specified in this
104subsection, the office may conduct an examination or
105investigation in accordance with s. 624.316, s. 624.3161, or s.
106624.320 and, if the findings of such examination or
107investigation warrant, may withdraw the eligibility of the
108insurer to issue policies or contracts pursuant to this
109subsection without having a certificate of authority issued by
110the office.
111     (c)  This subsection does not provide an exception to the
112agent licensure requirements of chapter 626. Any insurer issuing
113policies or contracts pursuant to this subsection shall appoint
114the agents that the insurer uses to sell such policies or
115contracts as provided in chapter 626.
116     (d)  An insurer issuing policies or contracts pursuant to
117this subsection is subject to part IX of chapter 626, Unfair
118Insurance Trade Practices, and the office may take such actions
119against the insurer for a violation as are provided in that
120part.
121     (e)  Policies and contracts issued pursuant to this
122subsection are not subject to the premium tax specified in s.
123624.509.
124     (f)  Applications for life insurance coverage offered under
125this subsection must contain, in contrasting color and not less
126than 12-point type, the following statement on the same page as
127the applicant's signature:
128
129This policy is primarily governed by the laws of a foreign
130country. As a result, all of the rating and underwriting
131laws applicable to policies filed in this state do not
132apply to this coverage, which may result in your premiums
133being higher than would be permissible under a Florida-
134approved policy. Any purchase of individual life insurance
135should be considered carefully, as future medical
136conditions may make it impossible to qualify for another
137individual life policy. If the insurer issuing your policy
138becomes insolvent, this policy is not covered by the
139Florida Life and Health Insurance Guaranty Association. For
140information concerning individual life coverage under a
141Florida-approved policy, consult your agent or the Florida
142Department of Financial Services.
143
144     (g)  All life insurance policies and annuity contracts
145issued pursuant to this subsection must contain on the first
146page of the policy or contract, in contrasting color and not
147less than 10-point type, the following statement:
148
149The benefits of the policy providing your coverage are
150governed primarily by the law of a country other than the
151United States.
152
153     (h)  All single-premium life insurance policies and single-
154premium annuity contracts issued to persons who are not
155residents of the United States and are not nonresidents
156illegally residing in the United States pursuant to this
157subsection shall be subject to the provisions of chapter 896.
158     Section 2.  This act shall take effect July 1, 2005.


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