Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
CHAMBER ACTION
Senate House
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11 Senator Posey moved the following amendment to amendment
12 (974260):
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14 Senate Amendment (with title amendment)
15 On page 128, between lines 18 and 19,
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17 insert:
18 Section 42. Subsection (1) and paragraph (b) of
19 subsection (2) of section 627.4133, Florida Statutes, are
20 amended to read:
21 627.4133 Notice of cancellation, nonrenewal, or
22 renewal premium.--
23 (1) Except as provided in subsection (2):
24 (a) An insurer issuing a policy providing coverage for
25 workers' compensation and employer's liability insurance,
26 property, casualty, except mortgage guaranty, surety, or
27 marine insurance, other than motor vehicle insurance subject
28 to s. 627.728, shall give the named insured at least 45 days'
29 advance written notice of nonrenewal or of the renewal
30 premium. If the policy is not to be renewed, the written
31 notice shall state the reason or reasons as to why the policy
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 is not to be renewed. This requirement applies only if the
2 insured has furnished all of the necessary information so as
3 to enable the insurer to develop the renewal premium prior to
4 the expiration date of the policy to be renewed.
5 (b) An insurer issuing a policy providing coverage for
6 property, casualty, except mortgage guaranty, surety, or
7 marine insurance, other than motor vehicle insurance subject
8 to s. 627.728 or s. 627.7281, shall give the named insured
9 written notice of cancellation or termination other than
10 nonrenewal at least 45 days prior to the effective date of the
11 cancellation or termination, including in the written notice
12 the reason or reasons for the cancellation or termination,
13 except that:
14 1. When cancellation is for nonpayment of premium, at
15 least 10 days' written notice of cancellation accompanied by
16 the reason therefor shall be given. As used in this
17 subparagraph, the term "nonpayment of premium" means failure
18 of the named insured to discharge when due any of her or his
19 obligations in connection with the payment of premiums on a
20 policy or any installment of such premium, whether the premium
21 is payable directly to the insurer or its agent or indirectly
22 under any premium finance plan or extension of credit, or
23 failure to maintain membership in an organization if such
24 membership is a condition precedent to insurance coverage.
25 "Nonpayment of premium" also means the failure of a financial
26 institution to honor an insurance applicant's check after
27 delivery to a licensed agent for payment of a premium, even if
28 the agent has previously delivered or transferred the premium
29 to the insurer. If a dishonored check represents the initial
30 premium payment, the contract and all contractual obligations
31 shall be void ab initio unless the nonpayment is cured within
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 the earlier of 5 days after actual notice by certified mail is
2 received by the applicant or 15 days after notice is sent to
3 the applicant by certified mail or registered mail, and if the
4 contract is void, any premium received by the insurer from a
5 third party shall be refunded to that party in full; and
6 2. When such cancellation or termination occurs during
7 the first 90 days during which the insurance is in force and
8 the insurance is canceled or terminated for reasons other than
9 nonpayment of premium, at least 20 days' written notice of
10 cancellation or termination accompanied by the reason therefor
11 shall be given except where there has been a material
12 misstatement or misrepresentation or failure to comply with
13 the underwriting requirements established by the insurer.
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15 After the policy has been in effect for 90 days, no such
16 policy shall be canceled by the insurer except when there has
17 been a material misstatement, a nonpayment of premium, a
18 failure to comply with underwriting requirements established
19 by the insurer within 90 days of the date of effectuation of
20 coverage, or a substantial change in the risk covered by the
21 policy or when the cancellation is for all insureds under such
22 policies for a given class of insureds. The provisions of This
23 subsection does shall not apply to individually rated risks
24 having a policy term of less than 90 days.
25 (c) If an insurer fails to provide the 45-day or
26 20-day written notice required under this section, the
27 coverage provided to the named insured shall remain in effect
28 until 45 days after the notice is given or until the effective
29 date of replacement coverage obtained by the named insured,
30 whichever occurs first. The premium for the coverage shall
31 remain the same during any such extension period except that,
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 in the event of failure to provide notice of nonrenewal, if
2 the rate filing then in effect would have resulted in a
3 premium reduction, the premium during such extension of
4 coverage shall be calculated based upon the later rate filing.
5 (2) With respect to any personal lines or commercial
6 residential property insurance policy, including, but not
7 limited to, any homeowner's, mobile home owner's, farmowner's,
8 condominium association, condominium unit owner's, apartment
9 building, or other policy covering a residential structure or
10 its contents:
11 (b) The insurer shall give the named insured written
12 notice of nonrenewal, cancellation, or termination at least 90
13 days prior to the effective date of the nonrenewal,
14 cancellation, or termination. The notice must include the
15 reason or reasons for the nonrenewal, cancellation, or
16 termination, except that:
17 1. When cancellation is for nonpayment of premium, at
18 least 10 days' written notice of cancellation accompanied by
19 the reason therefor shall be given. As used in this
20 subparagraph, the term "nonpayment of premium" means failure
21 of the named insured to discharge when due any of her or his
22 obligations in connection with the payment of premiums on a
23 policy or any installment of such premium, whether the premium
24 is payable directly to the insurer or its agent or indirectly
25 under any premium finance plan or extension of credit, or
26 failure to maintain membership in an organization if such
27 membership is a condition precedent to insurance coverage.
28 "Nonpayment of premium" also means the failure of a financial
29 institution to honor an insurance applicant's check after
30 delivery to a licensed agent for payment of a premium, even if
31 the agent has previously delivered or transferred the premium
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 to the insurer. If a dishonored check represents the initial
2 premium payment, the contract and all contractual obligations
3 shall be void ab initio unless the nonpayment is cured within
4 the earlier of 5 days after actual notice by certified mail is
5 received by the applicant or 15 days after notice is sent to
6 the applicant by certified mail or registered mail, and if the
7 contract is void, any premium received by the insurer from a
8 third party shall be refunded to that party in full.
9 2. When such cancellation or termination occurs during
10 the first 90 days during which the insurance is in force and
11 the insurance is canceled or terminated for reasons other than
12 nonpayment of premium, at least 20 days' written notice of
13 cancellation or termination accompanied by the reason therefor
14 shall be given except where there has been a material
15 misstatement or misrepresentation or failure to comply with
16 the underwriting requirements established by the insurer.
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18 After the policy has been in effect for 90 days, the policy
19 shall not be canceled by the insurer except when there has
20 been a material misstatement, a nonpayment of premium, a
21 failure to comply with underwriting requirements established
22 by the insurer within 90 days of the date of effectuation of
23 coverage, or a substantial change in the risk covered by the
24 policy or when the cancellation is for all insureds under such
25 policies for a given class of insureds. This paragraph does
26 not apply to individually rated risks having a policy term of
27 less than 90 days.
28 Section 43. Paragraph (r) is added to subsection (1)
29 of section 624.605, Florida Statutes, to read:
30 624.605 "Casualty insurance" defined.--
31 (1) "Casualty insurance" includes:
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
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1 (r)1. Debt collection.--Insurance that a creditor may
2 purchase against the risk of financial loss from the use of
3 debt cancellation products with consumer loans and leases.
4 Debt cancellation products, such as debt cancellation
5 contracts, debt suspension agreements, and guaranteed asset
6 protection contracts, are loan and lease contract terms, or
7 modifications to loan or lease contracts, under which a
8 creditor agrees to cancel or suspend all or part of a
9 customer's obligation to make payments upon the occurrence of
10 specified adverse events.
11 2. Debt cancellation products may be offered by
12 financial institutions, as defined in s. 655.005(1)(h), under
13 the same terms and conditions as depository institutions, as
14 defined in 12 U.S.C. s. 1813(c), or federal credit unions, as
15 defined in 12 U.S.C. s. 1752(1), and such agreements do not
16 constitute insurance for purposes of the Florida Insurance
17 Code.
18 Section 44. Subsection (3) of section 627.553, Florida
19 Statutes, is amended to read:
20 627.553 Debtor groups.--The lives of a group of
21 individuals may be insured under a policy issued to a creditor
22 or its parent holding company, or to a trustee or trustees or
23 agent designated by two or more creditors, which creditor,
24 holding company, affiliate, trustee or trustees, or agent
25 shall be deemed the policyholder, to insure debtors of the
26 creditor or creditors, subject to the following requirements:
27 (3) The amount of insurance on the life of any debtor
28 shall at no time exceed the amount owed by her or him which is
29 repayable in installments to the creditor or $50,000,
30 whichever is less, except that loans not exceeding 1 year's
31 duration shall not be subject to such limits. However, on
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 such loans not exceeding 1 year's duration, the limit of
2 coverage shall not exceed $50,000 with any one insurer.
3 Section 45. Paragraph (b) of subsection (1) of section
4 627.679, Florida Statutes, is amended to read:
5 627.679 Amount of insurance; disclosure.--
6 (1)
7 (b) The total amount of credit life insurance on the
8 life of any debtor with respect to any loan or loans covered
9 in one or more insurance policies shall at no time exceed the
10 amount of the indebtedness $50,000 with any one creditor,
11 except that loans not exceeding 1 year's duration shall not be
12 subject to such limits, and on such loans not exceeding 1
13 year's duration, the limits of coverage shall not exceed
14 $50,000 with any one insurer.
15 Section 46. Subsection (2) of section 627.681, Florida
16 Statutes, is amended to read:
17 627.681 Term and evidence of insurance.--
18 (2) The term of credit disability insurance on any
19 debtor insured under this section shall not exceed the term of
20 indebtedness 10 years, and for credit transactions that exceed
21 60 months, coverage shall not exceed 60 monthly indemnities.
22 Section 47. Paragraph (c) of subsection (1) of section
23 627.728, Florida Statutes, is amended to read:
24 627.728 Cancellations; nonrenewals.--
25 (1) As used in this section, the term:
26 (c) "Nonpayment of premium" means failure of the named
27 insured to discharge when due any of her or his obligations in
28 connection with the payment of premiums on a policy or any
29 installment of such premium, whether the premium is payable
30 directly to the insurer or its agent or indirectly under any
31 premium finance plan or extension of credit, or failure to
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 maintain membership in an organization if such membership is a
2 condition precedent to insurance coverage. "Nonpayment of
3 premium" also means the failure of a financial institution to
4 honor an insurance applicant's check after delivery to a
5 licensed agent for payment of a premium, even if the agent has
6 previously delivered or transferred the premium to the
7 insurer.; further, If the dishonored check represents the
8 initial premium payment, the contract and all contractual
9 obligations shall be void ab initio unless the nonpayment is
10 cured within the earlier of 5 days after actual notice by
11 certified mail is received by the applicant or 15 days after
12 notice is sent to the applicant by certified mail or
13 registered mail, and if the contract is void, any premium
14 received by the insurer from a third party shall be refunded
15 to that party in full. If a dishonored check is made payable
16 to the insurer, the insurer may cancel the policy in
17 accordance with paragraph (3)(a).
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19 (Redesignate subsequent sections.)
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22 ================ T I T L E A M E N D M E N T ===============
23 And the title is amended as follows:
24 On page 140, line 25, after the semicolon,
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26 insert:
27 amending s. 627.4133, F.S.; defining the term
28 "nonpayment of premium" for purposes of
29 insurance contracts; amending s. 624.605, F.S.;
30 defining insurance for debt cancellation
31 products for purposes of the Florida Insurance
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Florida Senate - 2006 SENATOR AMENDMENT
Bill No. HB 7225, 2nd Eng.
Barcode 804122
1 Code; providing that debt cancellation products
2 offered by financial institutions do not
3 constitute insurance for purposes of the
4 insurance code; amending ss. 627.553 and
5 627.679, F.S.; revising limitations on certain
6 amounts of life insurance on a debtor; amending
7 s. 627.681, F.S.; revising a limitation on the
8 term of credit disability insurance; amending
9 s. 627.728, F.S.; redefining the term
10 "nonpayment of premium" for purposes of motor
11 vehicle and casualty insurance;
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