HB 7225

CS

CHAMBER ACTION

1	The Fiscal Council recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to property and casualty insurance;
7	amending s. 215.555, F.S.; revising a definition; revising
8	certain reimbursement contract criteria; revising certain
9	reimbursement premium requirements; revising certain
10	revenue bond emergency assessment requirements; creating
11	s. 215.558, F.S.; creating the Florida Hurricane Damage
12	Prevention Endowment; providing a purpose and legislative
13	intent; providing definitions; providing requirements and
14	authority for investment of endowment assets by the State
15	Board of Administration; requiring a report to the
16	Legislature; providing for payment of the board's
17	investment services' costs and fees from the endowment;
18	providing requirements of the Department of Financial
19	Services in providing financial incentives for residential
20	hurricane damage prevention activities; providing for an
21	interest-free loan program; providing program criteria and
22	requirements; creating an advisory council for certain
23	purposes; providing for appointment of members; requiring
24	members to serve without compensation; providing for per
25	diem and travel expenses; creating s. 215.5586, F.S.;
26	establishing the Florida Comprehensive Hurricane Damage
27	Mitigation Program within the Department of Financial
28	Services; providing qualifications for the program
29	administrator; providing program components; requiring the
30	department to adopt rules; requiring the department to
31	adopt rules; creating s. 252.63, F.S.; providing purpose
32	and intent; providing powers of the Commissioner of
33	Insurance Regulation during a state of emergency;
34	providing a purpose and intent; authorizing the
35	commissioner to issue certain orders in a state of
36	emergency; providing for effect and duration of such
37	orders; providing for legislative termination of such
38	orders; requiring the commissioner to publish such orders
39	and an explanatory statement; amending s. 626.918, F.S.;
40	authorizing certain letters of credit to fund an insurer's
41	required policyholder protection trust fund; providing a
42	definition; amending s. 627.062, F.S.; specifying certain
43	rate filings as not subject to office determination as
44	excessive or unfairly discriminatory; providing
45	limitations; providing a definition; prohibiting certain
46	rate filings under certain circumstances; preserving the
47	office's authority to disapprove certain rate filings
48	under certain circumstances; providing procedures for
49	insurers submitting certain rate filings; specifying
50	nonapplication to certain types of insurance; specifying
51	approval of certain rate filings under certain
52	circumstances; providing an exception; requiring the
53	office to provide annual reports on the impact of certain
54	rate regulations; specifying report requirements; amending
55	s. 627.0628, F.S.; prohibiting certain office or consumer
56	advocate questions of certain models reviewed by the
57	commission; amending s. 627.06281, F.S.; prohibiting the
58	office from using certain hurricane loss projection models
59	under certain circumstances; amending s. 627.351, F.S.,
60	relating to the Citizens Property Insurance Corporation;
61	providing additional legislative intent; specifying
62	application to homestead property; specifying the existing
63	three separate accounts of the corporation as providing
64	coverage only for homestead property; providing a
65	definition; providing for an additional separate account
66	for nonhomestead property; requiring separate maintenance
67	of revenues, assets, liabilities, losses, and expenses
68	attributable to the nonhomestead account; providing
69	authority and requirements for coverage rates for
70	nonhomestead properties; providing for office review of
71	such rates or rating plans for being inadequate or
72	unfairly discriminatory; authorizing the office to order
73	discontinuance of certain policies under certain
74	circumstances; requiring insurers to maintain certain
75	records; providing for reducing regular assessments by the
76	Citizen policyholder surcharge under certain
77	circumstances; providing for deficit assessments against
78	nonhomestead account policyholders under certain
79	circumstances; authorizing the board of governors of the
80	corporation to make loans from the homestead accounts to
81	the nonhomestead account under certain circumstances;
82	specifying ineligibility of certain nonhomestead account
83	policyholders for certain coverage under certain
84	circumstances; revising the requirements of the plan of
85	operation of the corporation; requiring additional
86	procedures for determining eligibility of a risk for
87	coverage; providing for determination of regular
88	assessments to which the Citizen policyholder surcharge
89	applies; specifying a minimum requirement for a hurricane
90	deductible for certain property; specifying contents of
91	required statements in applications for nonhomestead and
92	homestead account coverage; requiring the corporation to
93	purchase certain catastrophe reinsurance; providing
94	additional legislative intent relating to rate adequacy in
95	the residual market; deleting provisions relating to a
96	rate methodology panel appointed by the corporation;
97	providing requirements and limitations for a corporation
98	adopted bonus payment program; providing a criterion for
99	calculating reduction or increase in probable maximum
100	loss; delaying application of certain high-risk area
101	boundary reduction provisions; providing for application
102	of provisions relating to homestead and nonhomestead
103	accounts to certain policies; requiring certain
104	corporation employees to comply with certain ethics code
105	requirements; requiring corporation employees to notify
106	the Division of Insurance Fraud of probable commissions of
107	fraud by corporation employees; requiring the corporation
108	to report on the feasibility of requiring authorized
109	insurers to issue and service specified policies of the
110	corporation; specifying report requirements; providing
111	immunity to producing agents and employees for specified
112	actions taken relating to removal of policies from the
113	corporation; providing a limitation; providing legislative
114	intent; creating a High Risk Eligibility Panel; providing
115	for appointment of panel members and member's terms;
116	providing for administration of the panel by the
117	corporation; prohibiting compensation and per diem and
118	travel expenses; providing an exception; requiring the
119	panel to report annually to the Legislature on the certain
120	areas that should be included in the Citizens Property
121	Insurance Corporation high risk account; specifying
122	factors to be considered by the panel; providing duties of
123	the office; authorizing the office to conduct public
124	hearings; requiring the panel to conduct an analysis of
125	property eligible for the high-risk account in specified
126	areas; requiring the panel to submit a report to the
127	office and corporation; providing requirements of the
128	report; amending s. 627.4035, F.S.; providing for a waiver
129	of a written authorization requirement to pay claims by
130	debit card or other electronic transfer; providing
131	construction relating to limiting the liability of an
132	insurer for certain replacement costs; amending s.
133	627.7011, F.S.; limiting certain law and ordinance
134	coverage; deleting application to personal property;
135	requiring insurers to issue separate checks for certain
136	expenses and requiring certain checks to be issued
137	directly to a policyholder; creating s. 627.7019, F.S.;
138	requiring the Financial Services Commission to adopt rules
139	imposing standardized requirements applicable to insurers
140	after certain natural events; providing criteria;
141	providing requirements of the Office of Insurance
142	Regulation; prohibiting certain conflicting emergency
143	rules; amending s. 627.727, F.S.; correcting a cross-
144	reference; amending s. 631.181, F.S.; providing an
145	exception to certain requirements for a signed statement
146	for certain claims; providing requirements; amending s.
147	631.54, F.S.; defining the term "homeowner's insurance";
148	amending s. 631.55, F.S.; correcting a cross-reference;
149	amending s. 631.57, F.S.; revising requirements and
150	limitations for obligations of the Florida Insurance
151	Guaranty Association for covered claims; authorizing the
152	association to contract with counties, municipalities, and
153	legal entities to issue revenue bonds for certain
154	purposes; authorizing the Office of Insurance Regulation
155	to levy assessments and emergency assessments on insurers
156	under certain circumstances for certain bond repayment
157	purposes; providing requirements for and limitations on
158	such assessments; providing for payment, collection, and
159	distribution of such assessments; requiring insurers to
160	include an analysis of revenues from such assessments in a
161	required report; providing rate filing requirements for
162	insurers relating to such assessments; providing for
163	continuing annual assessments under certain circumstances;
164	specifying emergency assessments as not premium and not
165	subject to certain taxes, fees, or commissions; specifying
166	insurer liability for emergency assessments; providing an
167	exception; creating s. 631.695, F.S.; providing
168	legislative findings and purposes; providing for issuance
169	of revenue bonds through counties and municipalities to
170	fund assistance programs for paying covered claims for
171	hurricane damage; providing procedures, requirements, and
172	limitations for counties, municipalities, and the Florida
173	Insurance Guaranty Association, Inc., relating to issuance
174	and validation of such bonds; prohibiting pledging the
175	funds, credit, property, and taxing power of the state,
176	counties, and municipalities for payment of bonds;
177	specifying authorized uses of bond proceeds; limiting the
178	term of bonds; specifying a state covenant to protect
179	bondholders from adverse actions relating to such bonds;
180	specifying exemptions for bonds, notes, and other
181	obligations of counties and municipalities from certain
182	taxes or assessments on property and revenues; authorizing
183	counties and municipalities to create a legal entity to
184	exercise certain powers; requiring the association to
185	issue an annual report on the status of certain uses of
186	bond proceeds; providing report requirements; requiring
187	the association to provide a copy of the report to the
188	Legislature and Chief Financial Officer; prohibiting
189	repeal of certain provisions relating to certain bonds
190	under certain circumstances; amending s. 817.234, F.S.;
191	providing an additional circumstance that constitutes
192	committing insurance fraud; creating the Task Force on
193	Hurricane Mitigation and Hurricane Insurance for Mobile
194	and Manufactured Homes; providing for administration by
195	the office; specifying additional agency administrative
196	staff; providing for appointment of task force members;
197	requiring members to serve without compensation; providing
198	for per diem and travel expenses; providing purpose and
199	intent; requiring the task force to address specified
200	issues; requiring a report to the Governor, Chief
201	Financial Officer, and Legislature; providing for
202	expiration of the task force; requiring the Office of
203	Insurance Regulation to submit reports to the Legislature
204	relating to the insurability of certain attached or free
205	standing structures and decreases in policyholder
206	hurricane deductibles based on policyholder hurricane
207	damage mitigation measures; providing report requirements;
208	providing duties of the office; providing appropriations;
209	specifying uses and purposes of appropriations; providing
210	effective dates.
211
212	Be It Enacted by the Legislature of the State of Florida:
213
214	Section 1.  Paragraph (d) of subsection (2), paragraphs (c)
215	and (d) of subsection (4), paragraph (b) of subsection (5), and
216	paragraph (b) of subsection (6) of section 215.555, Florida
217	Statutes, are amended to read:
218	215.555  Florida Hurricane Catastrophe Fund.--
219	(2)  DEFINITIONS.--As used in this section:
220	(d)  "Losses" means direct incurred losses under covered
221	policies, which shall include losses for additional living
222	expenses not to exceed 40 percent of the insured value of a
223	residential structure or its contents and shall exclude loss
224	adjustment expenses. "Losses" does not include losses for fair
225	rental value, loss of rent or rental income use, or business
226	interruption losses.
227	(4)  REIMBURSEMENT CONTRACTS.--
228	(c)1.  The contract shall also provide that the obligation
229	of the board with respect to all contracts covering a particular
230	contract year shall not exceed the actual claims-paying capacity
231	of the fund up to a limit of $15 billion for that contract year
232	adjusted based upon the reported exposure from the prior
233	contract year to reflect the percentage growth in exposure to
234	the fund for covered policies since 2003, provided the dollar
235	growth in the limit may not increase in any year by an amount
236	greater than the dollar growth of the cash balance of the fund
237	as of December 31 as defined by rule which occurred over the
238	prior calendar year.
239	2.  In May before the start of the upcoming contract year
240	and in October during the contract year, the board shall publish
241	in the Florida Administrative Weekly a statement of the fund's
242	estimated borrowing capacity and the projected balance of the
243	fund as of December 31. After the end of each calendar year, the
244	board shall notify insurers of the estimated borrowing capacity
245	and the balance of the fund as of December 31 to provide
246	insurers with data necessary to assist them in determining their
247	retention and projected payout from the fund for loss
248	reimbursement purposes. In conjunction with the development of
249	the premium formula, as provided for in subsection (5), the
250	board shall publish factors or multiples that assist insurers in
251	determining their retention and projected payout for the next
252	contract year. For all regulatory and reinsurance purposes, an
253	insurer may calculate its projected payout from the fund as its
254	share of the total fund premium for the current contract year
255	multiplied by the sum of the projected balance of the fund as of
256	December 31 and the estimated borrowing capacity for that
257	contract year as reported under this subparagraph.
258	(d)1.  For purposes of determining potential liability and
259	to aid in the sound administration of the fund, the contract
260	shall require each insurer to report such insurer's losses from
261	each covered event on an interim basis, as directed by the
262	board. The contract shall require the insurer to report to the
263	board no later than December 31 of each year, and quarterly
264	thereafter, its reimbursable losses from covered events for the
265	year. The contract shall require the board to determine and pay,
266	as soon as practicable after receiving these reports of
267	reimbursable losses, the initial amount of reimbursement due and
268	adjustments to this amount based on later loss information. The
269	adjustments to reimbursement amounts shall require the board to
270	pay, or the insurer to return, amounts reflecting the most
271	recent calculation of losses.
272	2.  In determining reimbursements pursuant to this
273	subsection, the contract shall provide that the board shall:
274	a.  First reimburse insurers writing covered policies,
275	which insurers are in full compliance with this section and have
276	petitioned the Office of Insurance Regulation and qualified as
277	limited apportionment companies under s. 627.351(2)(b)3. The
278	amount of such reimbursement shall be the lesser of $10 million
279	or an amount equal to 10 times the insurer's reimbursement
280	premium for the current year. The amount of reimbursement paid
281	under this sub-subparagraph may not exceed the full amount of
282	reimbursement promised in the reimbursement contract. This sub-
283	subparagraph does not apply with respect to any contract year in
284	which the year-end projected cash balance of the fund, exclusive
285	of any bonding capacity of the fund, exceeds $2 billion. Only
286	one member of any insurer group may receive reimbursement under
287	this sub-subparagraph.
288	a.b.  Next pay to each insurer such insurer's projected
289	payout, which is the amount of reimbursement it is owed, up to
290	an amount equal to the insurer's share of the actual premium
291	paid for that contract year, multiplied by the actual claims-
292	paying capacity available for that contract year; provided,
293	entities created pursuant to s. 627.351 shall be further
294	reimbursed in accordance with sub-subparagraph b. c.
295	b.c.  Thereafter, establish the prorated reimbursement
296	level at the highest level for which any remaining fund balance
297	or bond proceeds are sufficient to reimburse entities created
298	pursuant to s. 627.351 based on reimbursable losses exceeding
299	the amounts payable pursuant to sub-subparagraph a. b. for the
300	current contract year.
301	(5)  REIMBURSEMENT PREMIUMS.--
302	(b)  The State Board of Administration shall select an
303	independent consultant to develop a formula for determining the
304	actuarially indicated premium to be paid to the fund. The
305	formula shall specify, for each zip code or other limited
306	geographical area, the amount of premium to be paid by an
307	insurer for each $1,000 of insured value under covered policies
308	in that zip code or other area. In establishing premiums, the
309	board shall consider the coverage elected under paragraph (4)(b)
310	and any factors that tend to enhance the actuarial
311	sophistication of ratemaking for the fund, including
312	deductibles, type of construction, type of coverage provided,
313	relative concentration of risks, a factor providing for more
314	rapid cash buildup in the fund until the fund capacity for a
315	single hurricane season is fully funded, and other such factors
316	deemed by the board to be appropriate. The formula may provide
317	for a procedure to determine the premiums to be paid by new
318	insurers that begin writing covered policies after the beginning
319	of a contract year, taking into consideration when the insurer
320	starts writing covered policies, the potential exposure of the
321	insurer, the potential exposure of the fund, the administrative
322	costs to the insurer and to the fund, and any other factors
323	deemed appropriate by the board. The formula shall include a
324	factor of 25 percent of the fund's actuarially indicated premium
325	in order to provide for more rapid cash buildup in the fund. The
326	formula must be approved by unanimous vote of the board. The
327	board may, at any time, revise the formula pursuant to the
328	procedure provided in this paragraph.
329	(6)  REVENUE BONDS.--
330	(b)  Emergency assessments.--
331	1.  If the board determines that the amount of revenue
332	produced under subsection (5) is insufficient to fund the
333	obligations, costs, and expenses of the fund and the
334	corporation, including repayment of revenue bonds and that
335	portion of the debt service coverage not met by reimbursement
336	premiums, the board shall direct the Office of Insurance
337	Regulation to levy, by order, an emergency assessment on direct
338	premiums for all property and casualty lines of business in this
339	state, including property and casualty business of surplus lines
340	insurers regulated under part VIII of chapter 626, but not
341	including any workers' compensation premiums or medical
342	malpractice premiums. As used in this subsection, the term
343	"property and casualty business" includes all lines of business
344	identified on Form 2, Exhibit of Premiums and Losses, in the
345	annual statement required of authorized insurers by s. 624.424
346	and any rule adopted under this section, except for those lines
347	identified as accident and health insurance and except for
348	policies written under the National Flood Insurance Program. The
349	assessment shall be specified as a percentage of future premium
350	collections and is subject to annual adjustments by the board to
351	reflect changes in premiums subject to assessments collected
352	under this subparagraph in order to meet debt obligations. The
353	same percentage shall apply to all policies in lines of business
354	subject to the assessment issued or renewed during the 12-month
355	period beginning on the effective date of the assessment.
356	2.  A premium is not subject to an annual assessment under
357	this paragraph in excess of 6 percent of premium with respect to
358	obligations arising out of losses attributable to any one
359	contract year, and a premium is not subject to an aggregate
360	annual assessment under this paragraph in excess of 10 percent
361	of premium. An annual assessment under this paragraph shall
362	continue for as long as until the revenue bonds issued with
363	respect to which the assessment was imposed are outstanding,
364	including any bonds the proceeds of which were used to refund
365	the revenue bonds, unless adequate provision has been made for
366	the payment of the bonds under the documents authorizing
367	issuance of the bonds.
368	3.  With respect to each insurer collecting premiums that
369	are subject to the assessment, the insurer shall collect the
370	assessment at the same time as it collects the premium payment
371	for each policy and shall remit the assessment collected to the
372	fund or corporation as provided in the order issued by the
373	Office of Insurance Regulation. The office shall verify the
374	accurate and timely collection and remittance of emergency
375	assessments and shall report the information to the board in a
376	form and at a time specified by the board. Each insurer
377	collecting assessments shall provide the information with
378	respect to premiums and collections as may be required by the
379	office to enable the office to monitor and verify compliance
380	with this paragraph.
381	4.  With respect to assessments of surplus lines premiums,
382	each surplus lines agent shall collect the assessment at the
383	same time as the agent collects the surplus lines tax required
384	by s. 626.932, and the surplus lines agent shall remit the
385	assessment to the Florida Surplus Lines Service Office created
386	by s. 626.921 at the same time as the agent remits the surplus
387	lines tax to the Florida Surplus Lines Service Office. The
388	emergency assessment on each insured procuring coverage and
389	filing under s. 626.938 shall be remitted by the insured to the
390	Florida Surplus Lines Service Office at the time the insured
391	pays the surplus lines tax to the Florida Surplus Lines Service
392	Office. The Florida Surplus Lines Service Office shall remit the
393	collected assessments to the fund or corporation as provided in
394	the order levied by the Office of Insurance Regulation. The
395	Florida Surplus Lines Service Office shall verify the proper
396	application of such emergency assessments and shall assist the
397	board in ensuring the accurate and timely collection and
398	remittance of assessments as required by the board. The Florida
399	Surplus Lines Service Office shall annually calculate the
400	aggregate written premium on property and casualty business,
401	other than workers' compensation and medical malpractice,
402	procured through surplus lines agents and insureds procuring
403	coverage and filing under s. 626.938 and shall report the
404	information to the board in a form and at a time specified by
405	the board.
406	5.  Any assessment authority not used for a particular
407	contract year may be used for a subsequent contract year. If,
408	for a subsequent contract year, the board determines that the
409	amount of revenue produced under subsection (5) is insufficient
410	to fund the obligations, costs, and expenses of the fund and the
411	corporation, including repayment of revenue bonds and that
412	portion of the debt service coverage not met by reimbursement
413	premiums, the board shall direct the Office of Insurance
414	Regulation to levy an emergency assessment up to an amount not
415	exceeding the amount of unused assessment authority from a
416	previous contract year or years, plus an additional 4 percent
417	provided that the assessments in the aggregate do not exceed the
418	limits specified in subparagraph 2.
419	6.  The assessments otherwise payable to the corporation
420	under this paragraph shall be paid to the fund unless and until
421	the Office of Insurance Regulation and the Florida Surplus Lines
422	Service Office have received from the corporation and the fund a
423	notice, which shall be conclusive and upon which they may rely
424	without further inquiry, that the corporation has issued bonds
425	and the fund has no agreements in effect with local governments
426	under paragraph (c). On or after the date of the notice and
427	until the date the corporation has no bonds outstanding, the
428	fund shall have no right, title, or interest in or to the
429	assessments, except as provided in the fund's agreement with the
430	corporation.
431	7.  Emergency assessments are not premium and are not
432	subject to the premium tax, to the surplus lines tax, to any
433	fees, or to any commissions. An insurer is liable for all
434	assessments that it collects and must treat the failure of an
435	insured to pay an assessment as a failure to pay the premium. An
436	insurer is not liable for uncollectible assessments.
437	8.  When an insurer is required to return an unearned
438	premium, it shall also return any collected assessment
439	attributable to the unearned premium. A credit adjustment to the
440	collected assessment may be made by the insurer with regard to
441	future remittances that are payable to the fund or corporation,
442	but the insurer is not entitled to a refund.
443	9.  When a surplus lines insured or an insured who has
444	procured coverage and filed under s. 626.938 is entitled to the
445	return of an unearned premium, the Florida Surplus Lines Service
446	Office shall provide a credit or refund to the agent or such
447	insured for the collected assessment attributable to the
448	unearned premium prior to remitting the emergency assessment
449	collected to the fund or corporation.
450	10.  The exemption of medical malpractice insurance
451	premiums from emergency assessments under this paragraph is
452	repealed May 31, 2010 2007, and medical malpractice insurance
453	premiums shall be subject to emergency assessments attributable
454	to loss events occurring in the contract years commencing on
455	June 1, 2010 2007.
456	Section 2.  Section 215.558, Florida Statutes, is created
457	to read:
458	215.558  Florida Hurricane Damage Prevention Endowment.--
459	(1)  PURPOSE AND INTENT.--The purpose of this section is to
460	provide a continuing source of funding for financial incentives
461	to encourage residential property owners of this state to
462	retrofit their properties to make them less vulnerable to
463	hurricane damage, to help decrease the cost of residential
464	property and casualty insurance, and to provide matching funds
465	to local governments and nonprofit entities for projects that
466	will reduce hurricane damage to residential properties. It is
467	the intent of the Legislature that this section be construed
468	liberally to effectuate its purpose.
469	(2)  DEFINITIONS.--As used in this section:
470	(a)  "Board" means the State Board of Administration.
471	(b)  "Corpus" means the money that has been appropriated to
472	the endowment by the 2006 Legislature, together with any amounts
473	subsequently appropriated to the endowment that are specifically
474	designated as contributions to the corpus and any grants, gifts,
475	or donations to the endowment that are specifically designated
476	as contributions to the corpus.
477	(c)  "Earnings" means any money in the endowment in excess
478	of the corpus, including any income generated by investments,
479	any increase in the market value of investments net of decreases
480	in market value, and any appropriations, grants, gifts, or
481	donations to the endowment not specifically designated as
482	contributions to the corpus.
483	(d)  "Endowment" means the Florida Hurricane Damage
484	Prevention Endowment created by this section.
485	(e)  "Program administrator" means the Department of
486	Financial Services.
487	(3)  ADMINISTRATION.--
488	(a)  The board shall invest endowment assets as provided in
489	this section.
490	(b)  The board may invest and reinvest funds of the
491	endowment in accordance with s. 215.47 and consistent with board
492	policy.
493	(c)  The investment objective shall be long-term
494	preservation of the value of the corpus and a specified regular
495	annual cash outflow for appropriation, as nonrecurring revenue,
496	for the purposes specified in subsection (4).
497	(d)  In accordance with s. 215.44, the board shall report
498	on the financial status of the endowment in its annual
499	investment report to the Legislature.
500	(e)  Costs and fees of the board for investment services
501	shall be deducted from the assets of the endowment.
502	(4)  FINANCIAL INCENTIVES FOR RESIDENTIAL HURRICANE DAMAGE
503	PREVENTION ACTIVITIES.--
504	(a)  Not less than 80 percent of the net earnings of the
505	endowment shall be expended for financial incentives to
506	residential property owners as described in paragraph (b), and
507	no more than the remainder of the net earnings of the endowment
508	shall be expended for matching fund grants to local governments
509	and nonprofit entities for projects that will reduce hurricane
510	damage to residential properties as described in paragraph (c).
511	Any funds authorized for expenditure but not expended for these
512	purposes shall be returned to the endowment.
513	(b)1.  The program administrator, by rule, shall establish
514	a request for a proposal process to annually solicit proposals
515	from lending institutions under which the lending institution
516	will provide interest-free loans to homestead property owners to
517	pay for inspections of homestead property to determine what
518	mitigation measures are needed and for improvements to existing
519	residential properties intended to reduce the homestead
520	property's vulnerability to hurricane damage, in exchange for
521	funding from the endowment.
522	2.  In order to qualify for funding under this paragraph,
523	an interest-free loan program must include an inspection of
524	homestead property to determine what mitigation measures are
525	needed, a means for verifying that the improvements to be paid
526	for from loan proceeds have been demonstrated to reduce a
527	homestead property's vulnerability to hurricane damage, and a
528	means for verifying that the proceeds were actually spent on
529	such improvements. The program must include a method for
530	awarding loans according to the following priorities:
531	a.  The highest priority must be given to single-family
532	owner-occupied homestead dwellings, insured at $500,000 or less,
533	located in the areas designated as high-risk areas for purposes
534	of coverage by the Citizens Property Insurance Corporation.
535	b.  The next highest priority must be given to single-
536	family owner-occupied homestead dwellings, insured at $500,000
537	or less, covered by the Citizens Property Insurance Corporation,
538	wherever located.
539	c.  The next highest priority must be given to single-
540	family owner-occupied homestead dwellings, insured at $500,000
541	or less, that are more than 40 years old.
542	d.  The next highest priority must be given to all other
543	single-family owner-occupied homestead dwellings insured at
544	$500,000 or less.
545	3.  The program administrator shall evaluate proposals
546	based on the following factors:
547	a.  The degree to which the proposal meets the requirements
548	of subparagraph 2.
549	b.  The lending institution's plan for marketing the loans.
550	c.  The anticipated number of loans to be granted relative
551	to the total amount of funding sought.
552	4.  The program administrator shall annually solicit
553	proposals from local governments and nonprofit entities for
554	projects that will reduce hurricane damage to homestead
555	properties. The program administrator may provide up to 50
556	percent of the funding for such projects. The projects may
557	include educational programs, repair services, property
558	inspections, and hurricane vulnerability analyses and such other
559	projects as the program administrator determines to be
560	consistent with the purposes of this section.
561	(5)  ADVISORY COUNCIL.--There is created an advisory
562	council to provide advice and assistance to the program
563	administrator with regard to its administration of the
564	endowment. The advisory council shall consist of:
565	(a)  A representative of lending institutions, selected by
566	the Financial Services Commission from a list of at least three
567	persons recommended by the Florida Bankers Association.
568	(b)  A representative of residential property insurers,
569	selected by the Financial Services Commission from a list of at
570	least three persons recommended by the Florida Insurance
571	Council.
572	(c)  A representative of home builders, selected by the
573	Financial Services Commission from a list of at least three
574	persons recommended by the Florida Home Builders Association.
575	(d)  A faculty member of a state university selected by the
576	Financial Services Commission who is an expert in hurricane-
577	resistant construction methodologies and materials.
578	(e)  Two members of the House of Representatives selected
579	by the Speaker of the House of Representatives.
580	(f)  Two members of the Senate selected by the President of
581	the Senate.
582	(g)  The senior officer of the Florida Hurricane
583	Catastrophe Fund.
584	(h)  The executive director of Citizens Property Insurance
585	Corporation.
586	(i)  The director of the Division of Emergency Management
587	of the Department of Community Affairs.
588
589	Members appointed under paragraphs (a)-(d) shall serve at the
590	pleasure of the Financial Services Commission. Members appointed
591	under paragraphs (e) and (f) shall serve at the pleasure of the
592	appointing officer. All other members shall serve ex officio.
593	Members of the advisory council shall serve without compensation
594	but may receive reimbursement as provided in s. 112.061 for per
595	diem and travel expenses incurred in the performance of their
596	official duties.
597	Section 3.  Section 215.5586, Florida Statutes, is created
598	to read:
599	215.5586  Florida Comprehensive Hurricane Damage Mitigation
600	Program.--There is established within the Department of
601	Financial Services the Florida Comprehensive Hurricane Damage
602	Mitigation Program. The program shall be administered by an
603	individual with prior executive experience in the private sector
604	in the areas of insurance, business, or construction. The
605	program shall develop and implement a comprehensive and
606	coordinated approach for hurricane damage mitigation that shall
607	include the following:
608	(1)  WIND CERTIFICATION AND HURRICANE MITIGATION
609	INSPECTIONS.--Free home-retrofit inspections of single-family
610	site-built, owner-occupied, residential property shall be
611	offered to determine what mitigation measures are needed and
612	what improvements to existing residential properties are needed
613	to reduce the property's vulnerability to hurricane damage. The
614	Department of Financial Services shall establish a request for
615	proposals to solicit proposals from wind certification entities
616	to provide at no cost to homeowners wind certification and
617	hurricane mitigation inspections. The inspections provided to
618	homeowners, at a minimum, must include:
619	(a)  A home inspection and report that summarizes the
620	results and identifies corrective actions a homeowner may take
621	to mitigate hurricane damage.
622	(b)  A range of cost estimates regarding the mitigation
623	features.
624	(c)  Insurer-specific information regarding premium
625	discounts correlated to recommended mitigation features
626	identified by the inspection.
627	(d)  A hurricane resistance rating scale specifying the
628	home's current as well as projected wind resistance
629	capabilities.
630	(2)  GRANTS.--Financial grants shall be used to encourage
631	single-family, site-built, owner-occupied, residential property
632	owners to retrofit their properties to make them less vulnerable
633	to hurricane damage. The program shall create a process in which
634	mitigation contractors agree to participate and seek
635	reimbursement from the state and homeowners select from a list
636	of participating contractors. Matching fund grants shall also be
637	made available to local governments and nonprofit entities for
638	projects that will reduce hurricane damage to single-family,
639	site-built, owner-occupied, residential property.
640	(3)  LOANS.--Financial incentives shall be provided as
641	authorized by s. 215.558.
642	(4)  EDUCATION AND CONSUMER AWARENESS.--Multimedia public
643	education, awareness, and advertising efforts designed to
644	specifically address mitigation techniques shall be employed, as
645	well as a component to support ongoing consumer resources and
646	referral services.
647	(5)  RULES.--The Department of Financial Services shall
648	adopt rules pursuant to ss. 120.536(1) and 120.54 governing the
649	Florida Comprehensive Hurricane Damage Mitigation Program.
650	Section 4.  Section 252.63, Florida Statutes, is created to
651	read:
652	252.63  Commissioner of Insurance Regulation; powers in a
653	state of emergency.--
654	(1)  It is the purpose and intent of this section to
655	provide the Commissioner of Insurance Regulation the authority
656	to temporarily modify or suspend provisions of the Florida
657	Insurance Code in order to expedite the recovery of communities
658	affected by a disaster or other emergency and encourage
659	insurance companies, entities, and persons subject to the
660	Florida Insurance Code and the jurisdiction of the office to
661	meet the insurance needs of such communities.
662	(2)(a)  When the Governor declares a state of emergency
663	pursuant to s. 252.36, the commissioner may issue:
664	1.  One or more general orders applicable to all insurance
665	companies, entities, and persons, as defined in s. 624.04, that
666	are subject to the Florida Insurance Code and that serve any
667	portion of the area of the state under the state of emergency;
668	or
669	2.  One or more specific orders to particular insurance
670	companies, entities, and persons that are subject to the Florida
671	Insurance Code, as defined in s. 624.01, which orders may modify
672	or suspend, as to those companies, entities, and persons, all or
673	any part of the Florida Insurance Code, or any applicable rule,
674	consistent with the stated purposes of the Florida Insurance
675	Code.
676	(b)  An order issued by the commissioner under this section
677	becomes effective upon issuance and continues for 120 days
678	unless terminated sooner by the commissioner. The commissioner
679	may extend an order for one additional period of 120 days if he
680	or she determines that the emergency conditions that gave rise
681	to the initial order still exist. By concurrent resolution, the
682	Legislature may terminate any order issued under this section.
683	(3)  The commissioner shall publish in the next available
684	publication of the Florida Administrative Weekly a copy of the
685	text of any order issued under this section, together with a
686	statement describing the modification or suspension and
687	explaining how the modification or suspension will facilitate
688	recovery from the emergency.
689	Section 5.  Subsections (1) and (2) of section 626.918,
690	Florida Statutes, are amended to read:
691	626.918  Eligible surplus lines insurers.--
692	(1)  A No surplus lines agent may not shall place any
693	coverage with any unauthorized insurer which is not then an
694	eligible surplus lines insurer, except as permitted under
695	subsections (5) and (6).
696	(2)  An No unauthorized insurer may not shall be or become
697	an eligible surplus lines insurer unless made eligible by the
698	office in accordance with the following conditions:
699	(a)  Eligibility of the insurer must be requested in
700	writing by the Florida Surplus Lines Service Office.;
701	(b)  The insurer must be currently an authorized insurer in
702	the state or country of its domicile as to the kind or kinds of
703	insurance proposed to be so placed and must have been such an
704	insurer for not less than the 3 years next preceding or must be
705	the wholly owned subsidiary of such authorized insurer or must
706	be the wholly owned subsidiary of an already eligible surplus
707	lines insurer as to the kind or kinds of insurance proposed for
708	a period of not less than the 3 years next preceding. However,
709	the office may waive the 3-year requirement if the insurer
710	provides a product or service not readily available to the
711	consumers of this state or has operated successfully for a
712	period of at least 1 year next preceding and has capital and
713	surplus of not less than $25 million.;
714	(c)  Before granting eligibility, the requesting surplus
715	lines agent or the insurer shall furnish the office with a duly
716	authenticated copy of its current annual financial statement in
717	the English language and with all monetary values therein
718	expressed in United States dollars, at an exchange rate (in the
719	case of statements originally made in the currencies of other
720	countries) then-current and shown in the statement, and with
721	such additional information relative to the insurer as the
722	office may request.;
723	(d)1.a.  The insurer must have and maintain surplus as to
724	policyholders of not less than $15 million; in addition, an
725	alien insurer must also have and maintain in the United States a
726	trust fund for the protection of all its policyholders in the
727	United States under terms deemed by the office to be reasonably
728	adequate, in an amount not less than $5.4 million. Any such
729	surplus as to policyholders or trust fund shall be represented
730	by investments consisting of eligible investments for like funds
731	of like domestic insurers under part II of chapter 625 provided,
732	however, that in the case of an alien insurance company, any
733	such surplus as to policyholders may be represented by
734	investments permitted by the domestic regulator of such alien
735	insurance company if such investments are substantially similar
736	in terms of quality, liquidity, and security to eligible
737	investments for like funds of like domestic insurers under part
738	II of chapter 625. Clean, irrevocable, unconditional, and
739	evergreen letters of credit issued or confirmed by a qualified
740	United States financial institution, as defined in subparagraph
741	2., may be used to fund the trust.;
742	b.2.  For those surplus lines insurers that were eligible
743	on January 1, 1994, and that maintained their eligibility
744	thereafter, the required surplus as to policyholders shall be:
745	(I)a.  On December 31, 1994, and until December 30, 1995,
746	$2.5 million.
747	(II)b.  On December 31, 1995, and until December 30, 1996,
748	$3.5 million.
749	(III)c.  On December 31, 1996, and until December 30, 1997,
750	$4.5 million.
751	(IV)d.  On December 31, 1997, and until December 30, 1998,
752	$5.5 million.
753	(V)e.  On December 31, 1998, and until December 30, 1999,
754	$6.5 million.
755	(VI)f.  On December 31, 1999, and until December 30, 2000,
756	$8 million.
757	(VII)g.  On December 31, 2000, and until December 30, 2001,
758	$9.5 million.
759	(VIII)h.  On December 31, 2001, and until December 30,
760	2002, $11 million.
761	(IX)i.  On December 31, 2002, and until December 30, 2003,
762	$13 million.
763	(X)j.  On December 31, 2003, and thereafter, $15 million.
764	c.3.  The capital and surplus requirements as set forth in
765	sub-subparagraph b. subparagraph 2. do not apply in the case of
766	an insurance exchange created by the laws of individual states,
767	where the exchange maintains capital and surplus pursuant to the
768	requirements of that state, or maintains capital and surplus in
769	an amount not less than $50 million in the aggregate. For an
770	insurance exchange which maintains funds in the amount of at
771	least $12 million for the protection of all insurance exchange
772	policyholders, each individual syndicate shall maintain minimum
773	capital and surplus in an amount not less than $3 million. If
774	the insurance exchange does not maintain funds in the amount of
775	at least $12 million for the protection of all insurance
776	exchange policyholders, each individual syndicate shall meet the
777	minimum capital and surplus requirements set forth in sub-
778	subparagraph b. subparagraph 2.;
779	d.4.  A surplus lines insurer which is a member of an
780	insurance holding company that includes a member which is a
781	Florida domestic insurer as set forth in its holding company
782	registration statement, as set forth in s. 628.801 and rules
783	adopted thereunder, may elect to maintain surplus as to
784	policyholders in an amount equal to the requirements of s.
785	624.408, subject to the requirement that the surplus lines
786	insurer shall at all times be in compliance with the
787	requirements of chapter 625.
788
789	The election shall be submitted to the office and shall be
790	effective upon the office's being satisfied that the
791	requirements of sub-subparagraph d. subparagraph 4. have been
792	met. The initial date of election shall be the date of office
793	approval. The election approval application shall be on a form
794	adopted by commission rule. The office may approve an election
795	form submitted pursuant to sub-subparagraph d. subparagraph 4.
796	only if it was on file with the former Department of Insurance
797	before February 28, 1998.;
798	2.  For purposes of letters of credit under subparagraph
799	1., the term "qualified United States financial institution"
800	means an institution that:
801	a.  Is organized or, in the case of a United States office
802	of a foreign banking organization, is licensed under the laws of
803	the United States or any state.
804	b.  Is regulated, supervised, and examined by authorities
805	of the United States or any state having regulatory authority
806	over banks and trust companies.
807	c.  Has been determined by the office or the Securities
808	Valuation Office of the National Association of Insurance
809	Commissioners to meet such standards of financial condition and
810	standing as are considered necessary and appropriate to regulate
811	the quality of financial institutions whose letters of credit
812	are acceptable to the office.
813	(e)  The insurer must be of good reputation as to the
814	providing of service to its policyholders and the payment of
815	losses and claims.;
816	(f)  The insurer must be eligible, as for authority to
817	transact insurance in this state, under s. 624.404(3).; and
818	(g)  This subsection does not apply as to unauthorized
819	insurers made eligible under s. 626.917 as to wet marine and
820	aviation risks.
821	Section 6.  Paragraph (j) is added to subsection (2) of
822	section 627.062, Florida Statutes, and subsections (9) and (10)
823	are added to that section, to read:
824	627.062  Rate standards.--
825	(2)  As to all such classes of insurance:
826	(j)  Effective January 1, 2007, notwithstanding any other
827	provision of this section:
828	1.  With respect to any residential property insurance
829	subject to regulation under this section, a rate filing,
830	including, but not limited to, any rate changes, rating factors,
831	territories, classification, discounts, and credits, with
832	respect to any policy form, including endorsements issued with
833	the form, that results in an overall average statewide premium
834	increase or decrease of no more than 5 percent above or below
835	the premium that would result from the insurer's rates then in
836	effect shall not be subject to a determination by the office
837	that the rate is excessive or unfairly discriminatory except as
838	provided in subparagraph 3., or any other provision of law,
839	provided all changes specified in the filing do not result in an
840	overall premium increase of more than 10 percent for any one
841	territory, for reasons related solely to the rate change. As
842	used in this subparagraph, the term "insurer's rates then in
843	effect" includes only rates that have been lawfully in effect
844	under this section or rates that have been determined to be
845	lawful through administrative proceedings or judicial
846	proceedings.
847	2.  An insurer may not make filings under this paragraph
848	with respect to any policy form, including endorsements issued
849	with the form, if the overall premium changes resulting from
850	such filings exceed the amounts specified in this paragraph in
851	any 12-month period. An insurer may proceed under other
852	provisions of this section or other provisions of law if the
853	insurer seeks to exceed the premium or rate limitations of this
854	paragraph.
855	3.  This paragraph does not affect the authority of the
856	office to disapprove a rate as inadequate or to disapprove a
857	filing for the unlawful use of unfairly discriminatory rating
858	factors that are prohibited by the laws of this state. An
859	insurer electing to implement a rate change under this paragraph
860	shall submit a filing to the office at least 30 days prior to
861	the effective date of the rate change. The office shall have 30
862	days after the filing's submission to review the filing and
863	determine if the rate is inadequate or uses unfairly
864	discriminatory rating factors. Absent a finding by the office
865	within such 30-day period that the rate is inadequate or that
866	the insurer has used unfairly discriminatory rating factors, the
867	filing is deemed approved. If the office finds during the 30-day
868	period that the filing will result in inadequate premiums or
869	otherwise endanger the insurer's solvency, the office shall
870	suspend the rate decrease. If the insurer is implementing an
871	overall rate increase, the results of which continue to produce
872	an inadequate rate, such increase shall proceed pending
873	additional action by the office to ensure the adequacy of the
874	rate.
875	4.  This paragraph does not apply to rate filings for any
876	insurance other than residential property insurance.
877
878	The provisions of this subsection shall not apply to workers'
879	compensation and employer's liability insurance and to motor
880	vehicle insurance.
881	(9)  Notwithstanding any other provision of this section,
882	any rate filing or applicable portion of the rate filing that
883	includes the peril of wind in the high-risk account of the
884	Citizens Property Insurance Corporation shall be deemed approved
885	upon submission to the office if the filing or the applicable
886	portion of the filing requests approval of a rate that is less
887	than the approved rate for similar risks insured in the high-
888	risk account of the corporation unless the office determines
889	that such rate is inadequate or unfairly discriminatory as
890	provided in subsection (2).
891	(10)(a)  Beginning January 1, 2007, the office shall
892	annually provide a report to the President of the Senate, the
893	Speaker of the House of Representatives, the minority party
894	leader of each house of the Legislature, and the chairs of the
895	standing committees of each house of the Legislature having
896	jurisdiction over insurance issues, specifying the impact of
897	flexible rate regulation under paragraph (2)(j) on the degree of
898	competition in insurance markets in this state.
899	(b)  The report shall include a year-by-year comparison of
900	the number of companies participating in the market for each
901	class of insurance and the relative rate levels. The report
902	shall also specify:
903	1.  The number of rate filings made under paragraph (2)(j),
904	the rate levels under those filings, and the market share
905	affected by those filings.
906	2.  The number of filings made on a file and use basis, the
907	rate levels under those filings, and the market share affected
908	by those filings.
909	3.  The number of filings made on a use and file basis, the
910	rate levels under those filings, and the market share affected
911	by those filings.
912	4.  Recommendations to promote competition in the insurance
913	market and further protect insurance consumers.
914	Section 7.  Paragraph (c) of subsection (3) of section
915	627.0628, Florida Statutes, is amended to read:
916	627.0628  Florida Commission on Hurricane Loss Projection
917	Methodology; public records exemption; public meetings
918	exemption.--
919	(3)  ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES.--
920	(c)  With respect to a rate filing under s. 627.062, an
921	insurer may employ actuarial methods, principles, standards,
922	models, or output ranges found by the commission to be accurate
923	or reliable to determine hurricane loss factors for use in a
924	rate filing under s. 627.062. Such findings and factors are
925	admissible and relevant in consideration of a rate filing by the
926	office or in any arbitration or administrative or judicial
927	review only if the office and the consumer advocate appointed
928	pursuant to s. 627.0613 have a reasonable opportunity to review
929	access to all of the basic assumptions and factors that were
930	used in developing the actuarial methods, principles, standards,
931	models, or output ranges. After review of the specific models by
932	the commission, the office and the consumer advocate may not
933	pose any questions generated from their respective reviews that
934	duplicate or compromise the conclusions of the commission
935	relative to the accuracy or reliability of the models in
936	producing hurricane loss factors for use in a rate filing under
937	s. 627.062, and are not precluded from disclosing such
938	information in a rate proceeding.
939	Section 8.  Section 627.06281, Florida Statutes, is amended
940	to read:
941	627.06281  Public hurricane loss projection model;
942	reporting of data by insurers.--
943	(1)  Within 30 days after a written request for loss data
944	and associated exposure data by the office or a type I center
945	within the State University System established to study
946	mitigation, residential property insurers and licensed rating
947	and advisory organizations that compile residential property
948	insurance loss data shall provide loss data and associated
949	exposure data for residential property insurance policies to the
950	office or to a type I center within the State University System
951	established to study mitigation, as directed by the office, for
952	the purposes of developing, maintaining, and updating a public
953	model for hurricane loss projections. The loss data and
954	associated exposure data provided shall be in writing.
955	(2)  The office may not use the public model for hurricane
956	loss projection referred to in subsection (1) for any purpose
957	under s. 627.062 or s. 627.351 until the model has been
958	submitted to the Florida Commission on Hurricane Loss Projection
959	Methodology for review under s. 627.0628 and the commission has
960	found the model to be accurate and reliable pursuant to the same
961	process and standards as the commission uses for the review of
962	other hurricane loss projection models.
963	Section 9.  Subsection (6) of section 627.351, Florida
964	Statutes, is amended to read:
965	627.351  Insurance risk apportionment plans.--
966	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
967	(a)1.a.  The Legislature finds that actual and threatened
968	catastrophic losses to property in this state from hurricanes
969	have caused insurers to be unwilling or unable to provide
970	property insurance coverage to the extent sought and needed. It
971	is in the public interest and a public purpose to assist in
972	ensuring assuring that homestead property in the state is
973	insured so as to facilitate the remediation, reconstruction, and
974	replacement of damaged or destroyed property in order to reduce
975	or avoid the negative effects otherwise resulting to the public
976	health, safety, and welfare; to the economy of the state; and to
977	the revenues of the state and local governments needed to
978	provide for the public welfare. It is necessary, therefore, to
979	provide property insurance to applicants who are in good faith
980	entitled to procure insurance through the voluntary market but
981	are unable to do so. The Legislature intends by this subsection
982	that property insurance be provided and that it continues, as
983	long as necessary, through an entity organized to achieve
984	efficiencies and economies, while providing service to
985	policyholders, applicants, and agents that is no less than the
986	quality generally provided in the voluntary market, all toward
987	the achievement of the foregoing public purposes. Because it is
988	essential for the corporation to have the maximum financial
989	resources to pay claims following a catastrophic hurricane, it
990	is the intent of the Legislature that the income of the
991	corporation be exempt from federal income taxation and that
992	interest on the debt obligations issued by the corporation be
993	exempt from federal income taxation.
994	b.  The Legislature finds and declares that:
995	(I)  The commitment of the state, as expressed in sub-
996	subparagraph a., to providing a means of ensuring the
997	availability of property insurance through a residual market
998	mechanism is hereby reaffirmed.
999	(II)  Despite legislative efforts to ensure that the
1000	residual market for property insurance is self-supporting to the
1001	greatest reasonable extent, residual market policyholders are to
1002	some degree subsidized by the general public through assessments
1003	on owners of property insured in the voluntary market and their
1004	insurers and through the potential use of general revenues of
1005	the state to eliminate or reduce residual market deficits.
1006	(III)  The degree of such subsidy is a matter of public
1007	policy. It is the intent of the Legislature to better control
1008	the subsidy through at least the following means:
1009	(A)  Restructuring the residual market mechanism to provide
1010	separate treatment of homestead and nonhomestead properties,
1011	with the intent of continuing to provide an insurance program
1012	with limited subsidies for homestead properties while providing
1013	a nonsubsidized insurance program for nonhomestead properties.
1014	(B)  Redefining the concept of rate adequacy in the
1015	subsidized residual market with the intent of ensuring a rate
1016	structure that will enable the subsidized residual market to be
1017	self-supporting except in the event of hurricane losses of a
1018	legislatively specified magnitude. It is the intent of the
1019	Legislature that the funding of the subsidized residual market
1020	be structured to be self-supporting up to the point of its 100-
1021	year probable maximum loss and that the funding be structured to
1022	make reliance on assessments or other sources of public funding
1023	necessary only in the event of a 100-year probable maximum loss
1024	or larger loss.
1025	2.  The Residential Property and Casualty Joint
1026	Underwriting Association originally created by this statute
1027	shall be known, as of July 1, 2002, as the Citizens Property
1028	Insurance Corporation. The corporation shall provide insurance
1029	for homesteaded residential property and may provide insurance
1030	for residential and commercial property, for applicants who are
1031	in good faith entitled, but are unable, to procure insurance
1032	through the voluntary market. The corporation shall operate
1033	pursuant to a plan of operation approved by order of the office.
1034	The plan is subject to continuous review by the office. The
1035	office may, by order, withdraw approval of all or part of a plan
1036	if the office determines that conditions have changed since
1037	approval was granted and that the purposes of the plan require
1038	changes in the plan. For the purposes of this subsection,
1039	residential coverage includes both personal lines residential
1040	coverage, which consists of the type of coverage provided by
1041	homeowner's, mobile home owner's, dwelling, tenant's,
1042	condominium unit owner's, and similar policies, and commercial
1043	lines residential coverage, which consists of the type of
1044	coverage provided by condominium association, apartment
1045	building, and similar policies.
1046	3.  It is the intent of the Legislature that policyholders,
1047	applicants, and agents of the corporation receive service and
1048	treatment of the highest possible level but never less than that
1049	generally provided in the voluntary market. It also is intended
1050	that the corporation be held to service standards no less than
1051	those applied to insurers in the voluntary market by the office
1052	with respect to responsiveness, timeliness, customer courtesy,
1053	and overall dealings with policyholders, applicants, or agents
1054	of the corporation.
1055	(b)1.  All insurers authorized to write one or more subject
1056	lines of business in this state are subject to assessment by the
1057	corporation and, for the purposes of this subsection, are
1058	referred to collectively as "assessable insurers." Insurers
1059	writing one or more subject lines of business in this state
1060	pursuant to part VIII of chapter 626 are not assessable
1061	insurers, but insureds who procure one or more subject lines of
1062	business in this state pursuant to part VIII of chapter 626 are
1063	subject to assessment by the corporation and are referred to
1064	collectively as "assessable insureds." An authorized insurer's
1065	assessment liability shall begin on the first day of the
1066	calendar year following the year in which the insurer was issued
1067	a certificate of authority to transact insurance for subject
1068	lines of business in this state and shall terminate 1 year after
1069	the end of the first calendar year during which the insurer no
1070	longer holds a certificate of authority to transact insurance
1071	for subject lines of business in this state.
1072	2.a.  All revenues, assets, liabilities, losses, and
1073	expenses of the corporation shall be divided into four three
1074	separate accounts as follows:
1075	(I)  Three separate homestead accounts that may provide
1076	coverage only for homestead properties. The term "homestead
1077	property" means a residential property that has been granted a
1078	homestead exemption under chapter 196. The term also includes a
1079	property that is qualified for such exemption but has not
1080	applied for the exemption as of the date of issuance of the
1081	policy, provided the policyholder obtains the exemption within 1
1082	year after initial issuance of the policy. The term also
1083	includes an owner-occupied mobile or manufactured home as
1084	defined in s. 320.01 permanently affixed to real property
1085	regardless of whether the owner of the mobile or manufactured
1086	home is also the owner of the land on which the mobile or
1087	manufactured home is permanently affixed. However, the term does
1088	not include a mobile home that is being held for display by a
1089	licensed mobile home dealer or a licensed mobile home
1090	manufacturer and is not owner-occupied. For the purposes of this
1091	sub-sub-subparagraph, the term "homestead property" also
1092	includes property covered by tenant's insurance and commercial
1093	lines residential policies. The accounts providing coverage only
1094	for homestead properties are:
1095	(A)(I)  A personal lines account for personal residential
1096	policies issued by the corporation or issued by the Residential
1097	Property and Casualty Joint Underwriting Association and renewed
1098	by the corporation that provide comprehensive, multiperil
1099	coverage on risks that are not located in areas eligible for
1100	coverage in the Florida Windstorm Underwriting Association as
1101	those areas were defined on January 1, 2002, and for such
1102	policies that do not provide coverage for the peril of wind on
1103	risks that are located in such areas;
1104	(B)(II)  A commercial lines account for commercial
1105	residential policies issued by the corporation or issued by the
1106	Residential Property and Casualty Joint Underwriting Association
1107	and renewed by the corporation that provide coverage for basic
1108	property perils on risks that are not located in areas eligible
1109	for coverage in the Florida Windstorm Underwriting Association
1110	as those areas were defined on January 1, 2002, and for such
1111	policies that do not provide coverage for the peril of wind on
1112	risks that are located in such areas; and
1113	(C)(III)  A high-risk account for personal residential
1114	policies and commercial residential and commercial
1115	nonresidential property policies issued by the corporation or
1116	transferred to the corporation that provide coverage for the
1117	peril of wind on risks that are located in areas eligible for
1118	coverage in the Florida Windstorm Underwriting Association as
1119	those areas were defined on January 1, 2002. The high-risk
1120	account must also include quota share primary insurance under
1121	subparagraph (c)2. The area eligible for coverage under the
1122	high-risk account also includes the area within Port Canaveral,
1123	which is bordered on the south by the City of Cape Canaveral,
1124	bordered on the west by the Banana River, and bordered on the
1125	north by Federal Government property. The office may remove
1126	territory from the area eligible for wind-only and quota share
1127	coverage if, after a public hearing, the office finds that
1128	authorized insurers in the voluntary market are willing and able
1129	to write sufficient amounts of personal and commercial
1130	residential coverage for all perils in the territory, including
1131	coverage for the peril of wind, such that risks covered by wind-
1132	only policies in the removed territory could be issued a policy
1133	by the corporation in either the personal lines or commercial
1134	lines account without a significant increase in the
1135	corporation's probable maximum loss in such account. Removal of
1136	territory from the area eligible for wind-only or quota share
1137	coverage does not alter the assignment of wind coverage written
1138	in such areas to the high-risk account.
1139	(II)(A)  A separate nonhomestead account for all properties
1140	that otherwise meet all of the criteria for eligibility for
1141	coverage within one of the three homestead accounts described in
1142	sub-sub-subparagraph (I) but that do not meet the definition of
1143	homestead property specified in sub-sub-subparagraph (I). The
1144	nonhomestead account shall provide the same types of coverage as
1145	are provided by the three homestead accounts, including wind-
1146	only coverage in the high-risk account area. In order to be
1147	eligible for coverage in the nonhomestead account, at the
1148	initial issuance of the policy and at renewal the property owner
1149	shall provide the corporation with a sworn affidavit stating
1150	that the property has been rejected for coverage by at least
1151	three authorized insurers and at least three surplus lines
1152	insurers.
1153	(B)  An authorized insurer may provide coverage to a
1154	nonhomestead property owner on an individual risk rate basis.
1155	Rates and forms of an authorized insurer for nonhomestead
1156	properties are not subject to ss. 627.062 and 627.0629, except
1157	s. 627.0629(2)(b). Such rates and forms are subject to all other
1158	applicable provisions of this code and rules adopted under this
1159	code. During the course of an insurer's market conduct
1160	examination, the office may review the rate for any nonhomestead
1161	property to determine if such rate is inadequate or unfairly
1162	discriminatory. Rates on nonhomestead property may be found
1163	inadequate by the office if they are clearly insufficient,
1164	together with the investment income attributable to the insurer,
1165	to sustain projected losses and expenses in the class of
1166	business to which such rates apply. Rates on nonhomestead
1167	property may also be found inadequate as to the premium charged
1168	to a risk or group of risks if discounts or credits are allowed
1169	that exceed a reasonable reflection of expense savings and
1170	reasonably expected loss experience from the risk or group of
1171	risks. Rates on nonhomestead property may be found to be
1172	unfairly discriminatory as to a risk or group of risks by the
1173	office if the application of premium discounts, credits, or
1174	surcharges among such risks does not bear a reasonable
1175	relationship to the expected loss and expense experience among
1176	the various risks. A rating plan, including discounts, credits,
1177	or surcharges on nonhomestead property, may also be found to be
1178	unfairly discriminatory if the plan fails to clearly and
1179	equitably reflect consideration of the policyholder's
1180	participation in a risk management program adjusted pursuant to
1181	s. 627.0625. The office may order an insurer to discontinue
1182	using a rate for new policies or upon renewal of a policy if the
1183	office finds the rate to be inadequate or unfairly
1184	discriminatory. Insurers shall maintain records and
1185	documentation relating to rates and forms subject to this sub-
1186	sub-sub-subparagraph for a period of at least 5 years after the
1187	effective date of the policy.
1188	b.  The three separate homestead accounts must be
1189	maintained as long as financing obligations entered into by the
1190	Florida Windstorm Underwriting Association or Residential
1191	Property and Casualty Joint Underwriting Association are
1192	outstanding, in accordance with the terms of the corresponding
1193	financing documents. When the financing obligations are no
1194	longer outstanding, in accordance with the terms of the
1195	corresponding financing documents, the corporation may use a
1196	single homestead account for all revenues, assets, liabilities,
1197	losses, and expenses of the corporation. All revenues, assets,
1198	liabilities, losses, and expenses attributable to the
1199	nonhomestead account shall be maintained separately.
1200	c.  Creditors of the Residential Property and Casualty
1201	Joint Underwriting Association shall have a claim against, and
1202	recourse to, the accounts referred to in sub-sub-sub-
1203	subparagraphs sub-sub-subparagraphs a.(I)(A) and (B)(II) and
1204	shall have no claim against, or recourse to, the account
1205	referred to in sub-sub-sub-subparagraph sub-sub-subparagraph
1206	a.(I)(C)(III). Creditors of the Florida Windstorm Underwriting
1207	Association shall have a claim against, and recourse to, the
1208	account referred to in sub-sub-sub-subparagraph sub-sub-
1209	subparagraph a.(I)(C)(III) and shall have no claim against, or
1210	recourse to, the accounts referred to in sub-sub-sub-
1211	subparagraphs sub-sub-subparagraphs a.(I)(A) and (B)(II).
1212	d.  Revenues, assets, liabilities, losses, and expenses not
1213	attributable to particular accounts shall be prorated among the
1214	accounts.
1215	e.  The Legislature finds that the revenues of the
1216	corporation are revenues that are necessary to meet the
1217	requirements set forth in documents authorizing the issuance of
1218	bonds under this subsection.
1219	f.  No part of the income of the corporation may inure to
1220	the benefit of any private person.
1221	3.  With respect to a deficit in any of the homestead
1222	accounts an account:
1223	a.  When the deficit incurred in a particular calendar year
1224	is not greater than 10 percent of the aggregate statewide direct
1225	written premium for the subject lines of business for the prior
1226	calendar year, the entire deficit shall be recovered through
1227	regular assessments of assessable insurers under paragraph (g)
1228	and assessable insureds.
1229	b.  When the deficit incurred in a particular calendar year
1230	exceeds 10 percent of the aggregate statewide direct written
1231	premium for the subject lines of business for the prior calendar
1232	year, the corporation shall levy regular assessments on
1233	assessable insurers under paragraph (g) and on assessable
1234	insureds in an amount equal to the greater of 10 percent of the
1235	deficit or 10 percent of the aggregate statewide direct written
1236	premium for the subject lines of business for the prior calendar
1237	year. Any remaining deficit shall be recovered through emergency
1238	assessments under sub-subparagraph d.
1239	c.  Each assessable insurer's share of the amount being
1240	assessed under sub-subparagraph a. or sub-subparagraph b. shall
1241	be in the proportion that the assessable insurer's direct
1242	written premium for the subject lines of business for the year
1243	preceding the year in which the deficit is incurred assessment
1244	bears to the aggregate statewide direct written premium for the
1245	subject lines of business for that year. The assessment
1246	percentage applicable to each assessable insured is the ratio of
1247	the amount being assessed under sub-subparagraph a. or sub-
1248	subparagraph b. to the aggregate statewide direct written
1249	premium for the subject lines of business for the prior year.
1250	Assessments levied by the corporation on assessable insurers
1251	under sub-subparagraphs a. and b. shall be paid as required by
1252	the corporation's plan of operation and paragraph (g).
1253	Notwithstanding any other provision in this subsection, the
1254	aggregate amount of a regular assessment levied in connection
1255	with a deficit incurred in a particular calendar year shall be
1256	reduced by the aggregate amount of the Citizens Property
1257	Insurance Corporation policyholder surcharge imposed under
1258	subparagraph (c)10. Assessments levied by the corporation on
1259	assessable insureds under sub-subparagraphs a. and b. shall be
1260	collected by the surplus lines agent at the time the surplus
1261	lines agent collects the surplus lines tax required by s.
1262	626.932 and shall be paid to the Florida Surplus Lines Service
1263	Office at the time the surplus lines agent pays the surplus
1264	lines tax to the Florida Surplus Lines Service Office. Upon
1265	receipt of regular assessments from surplus lines agents, the
1266	Florida Surplus Lines Service Office shall transfer the
1267	assessments directly to the corporation as determined by the
1268	corporation.
1269	d.  Upon a determination by the board of governors that a
1270	deficit in an account exceeds the amount that will be recovered
1271	through regular assessments under sub-subparagraph a. or sub-
1272	subparagraph b., the board shall levy, after verification by the
1273	office, emergency assessments, for as many years as necessary to
1274	cover the deficits, to be collected by assessable insurers and
1275	the corporation and collected from assessable insureds upon
1276	issuance or renewal of policies for subject lines of business,
1277	excluding National Flood Insurance policies. The amount of the
1278	emergency assessment collected in a particular year shall be a
1279	uniform percentage of that year's direct written premium for
1280	subject lines of business and all accounts of the corporation,
1281	excluding National Flood Insurance Program policy premiums, as
1282	annually determined by the board and verified by the office. The
1283	office shall verify the arithmetic calculations involved in the
1284	board's determination within 30 days after receipt of the
1285	information on which the determination was based.
1286	Notwithstanding any other provision of law, the corporation and
1287	each assessable insurer that writes subject lines of business
1288	shall collect emergency assessments from its policyholders
1289	without such obligation being affected by any credit,
1290	limitation, exemption, or deferment. Emergency assessments
1291	levied by the corporation on assessable insureds shall be
1292	collected by the surplus lines agent at the time the surplus
1293	lines agent collects the surplus lines tax required by s.
1294	626.932 and shall be paid to the Florida Surplus Lines Service
1295	Office at the time the surplus lines agent pays the surplus
1296	lines tax to the Florida Surplus Lines Service Office. The
1297	emergency assessments so collected shall be transferred directly
1298	to the corporation on a periodic basis as determined by the
1299	corporation and shall be held by the corporation solely in the
1300	applicable account. The aggregate amount of emergency
1301	assessments levied for an account under this sub-subparagraph in
1302	any calendar year may not exceed the greater of 10 percent of
1303	the amount needed to cover the original deficit, plus interest,
1304	fees, commissions, required reserves, and other costs associated
1305	with financing of the original deficit, or 10 percent of the
1306	aggregate statewide direct written premium for subject lines of
1307	business and for all accounts of the corporation for the prior
1308	year, plus interest, fees, commissions, required reserves, and
1309	other costs associated with financing the original deficit.
1310	e.  The corporation may pledge the proceeds of assessments,
1311	projected recoveries from the Florida Hurricane Catastrophe
1312	Fund, other insurance and reinsurance recoverables, Citizens
1313	policyholder market equalization surcharges and other
1314	surcharges, and other funds available to the corporation as the
1315	source of revenue for and to secure bonds issued under paragraph
1316	(g), bonds or other indebtedness issued under subparagraph
1317	(c)3., or lines of credit or other financing mechanisms issued
1318	or created under this subsection, or to retire any other debt
1319	incurred as a result of deficits or events giving rise to
1320	deficits, or in any other way that the board determines will
1321	efficiently recover such deficits. The purpose of the lines of
1322	credit or other financing mechanisms is to provide additional
1323	resources to assist the corporation in covering claims and
1324	expenses attributable to a catastrophe. As used in this
1325	subsection, the term "assessments" includes regular assessments
1326	under sub-subparagraph a., sub-subparagraph b., or subparagraph
1327	(g)1. and emergency assessments under sub-subparagraph d.
1328	Emergency assessments collected under sub-subparagraph d. are
1329	not part of an insurer's rates, are not premium, and are not
1330	subject to premium tax, fees, or commissions; however, failure
1331	to pay the emergency assessment shall be treated as failure to
1332	pay premium. The emergency assessments under sub-subparagraph d.
1333	shall continue as long as any bonds issued or other indebtedness
1334	incurred with respect to a deficit for which the assessment was
1335	imposed remain outstanding, unless adequate provision has been
1336	made for the payment of such bonds or other indebtedness
1337	pursuant to the documents governing such bonds or other
1338	indebtedness.
1339	f.  As used in this subsection, the term "subject lines of
1340	business" means insurance written by assessable insurers or
1341	procured by assessable insureds on real or personal property, as
1342	defined in s. 624.604, including insurance for fire, industrial
1343	fire, allied lines, farmowners multiperil, homeowners
1344	multiperil, commercial multiperil, and mobile homes, and
1345	including liability coverage on all such insurance, but
1346	excluding inland marine as defined in s. 624.607(3) and
1347	excluding vehicle insurance as defined in s. 624.605(1) other
1348	than insurance on mobile homes used as permanent dwellings.
1349	g.  The Florida Surplus Lines Service Office shall
1350	determine annually the aggregate statewide written premium in
1351	subject lines of business procured by assessable insureds and
1352	shall report that information to the corporation in a form and
1353	at a time the corporation specifies to ensure that the
1354	corporation can meet the requirements of this subsection and the
1355	corporation's financing obligations.
1356	h.  The Florida Surplus Lines Service Office shall verify
1357	the proper application by surplus lines agents of assessment
1358	percentages for regular assessments and emergency assessments
1359	levied under this subparagraph on assessable insureds and shall
1360	assist the corporation in ensuring the accurate, timely
1361	collection and payment of assessments by surplus lines agents as
1362	required by the corporation.
1363	4.  With respect to a deficit in the nonhomestead account
1364	or to any cash flow shortfall that the board determines will
1365	create an inability for the nonhomestead account to pay claims
1366	when due:
1367	a.  The board shall levy an immediate assessment against
1368	the premium of each nonhomestead account policyholder, expressed
1369	as a uniform percentage of the premium for the policy then in
1370	effect. The maximum amount of such assessment is 100 percent of
1371	such premium.
1372	b.  If the assessment under sub-subparagraph a. is
1373	insufficient to enable the account to pay claims and eliminate
1374	the deficit in the account, the board may levy an additional
1375	assessment to be collected at the time of any issuance or
1376	renewal of a nonhomestead account policy during the 1-year
1377	period following the levy of the assessment under sub-
1378	subparagraph a., expressed as a uniform percentage of the
1379	premium for the policy for the forthcoming policy period. The
1380	maximum amount of such assessment is 100 percent of such
1381	premium.
1382	c.  If the assessments under sub-subparagraphs a. and b.
1383	are insufficient to enable the account to pay claims and
1384	eliminate the deficit in the account, the board may make a loan
1385	from any of the homestead accounts to the nonhomestead account,
1386	subject to approval by the office and provided that such loan
1387	does not impair the financial status of any of the homestead
1388	accounts.
1389	5.  A policyholder in a nonhomestead account who has not
1390	paid a deficit assessment levied by the corporation shall be
1391	ineligible for coverage by a surplus lines insurer or authorized
1392	insurer.
1393	(c)  The plan of operation of the corporation:
1394	1.  Must provide for adoption of residential property and
1395	casualty insurance policy forms, rates, and underwriting rules
1396	and commercial residential and nonresidential property insurance
1397	forms, rates, and underwriting rules which forms must be
1398	approved by the office prior to use. The corporation shall adopt
1399	the following policy forms:
1400	a.  Standard personal lines policy forms that are
1401	comprehensive multiperil policies providing full coverage of a
1402	residential property equivalent to the coverage provided in the
1403	private insurance market under an HO-3, HO-4, or HO-6 policy.
1404	b.  Basic personal lines policy forms that are policies
1405	similar to an HO-8 policy or a dwelling fire policy that provide
1406	coverage meeting the requirements of the secondary mortgage
1407	market, but which coverage is more limited than the coverage
1408	under a standard policy.
1409	c.  Commercial lines residential policy forms that are
1410	generally similar to the basic perils of full coverage
1411	obtainable for commercial residential structures in the admitted
1412	voluntary market.
1413	d.  Personal lines and commercial lines residential
1414	property insurance forms that cover the peril of wind only. The
1415	forms are applicable only to residential properties located in
1416	areas eligible for coverage under the high-risk account referred
1417	to in sub-subparagraph (b)2.a.
1418	e.  Commercial lines nonresidential property insurance
1419	forms that cover the peril of wind only. The forms are
1420	applicable only to nonresidential properties located in areas
1421	eligible for coverage under the high-risk account referred to in
1422	sub-subparagraph (b)2.a.
1423	f.  The corporation may adopt variations of the policy
1424	forms listed in sub-subparagraphs a.-e. that contain more
1425	restrictive coverage.
1426	2.a.  Must provide that the corporation adopt a program in
1427	which the corporation and authorized insurers enter into quota
1428	share primary insurance agreements for hurricane coverage, as
1429	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1430	property insurance forms for eligible risks which cover the
1431	peril of wind only. As used in this subsection, the term:
1432	(I)  "Quota share primary insurance" means an arrangement
1433	in which the primary hurricane coverage of an eligible risk is
1434	provided in specified percentages by the corporation and an
1435	authorized insurer. The corporation and authorized insurer are
1436	each solely responsible for a specified percentage of hurricane
1437	coverage of an eligible risk as set forth in a quota share
1438	primary insurance agreement between the corporation and an
1439	authorized insurer and the insurance contract. The
1440	responsibility of the corporation or authorized insurer to pay
1441	its specified percentage of hurricane losses of an eligible
1442	risk, as set forth in the quota share primary insurance
1443	agreement, may not be altered by the inability of the other
1444	party to the agreement to pay its specified percentage of
1445	hurricane losses. Eligible risks that are provided hurricane
1446	coverage through a quota share primary insurance arrangement
1447	must be provided policy forms that set forth the obligations of
1448	the corporation and authorized insurer under the arrangement,
1449	clearly specify the percentages of quota share primary insurance
1450	provided by the corporation and authorized insurer, and
1451	conspicuously and clearly state that neither the authorized
1452	insurer nor the corporation may be held responsible beyond its
1453	specified percentage of coverage of hurricane losses.
1454	(II)  "Eligible risks" means personal lines residential and
1455	commercial lines residential risks that meet the underwriting
1456	criteria of the corporation and are located in areas that were
1457	eligible for coverage by the Florida Windstorm Underwriting
1458	Association on January 1, 2002.
1459	b.  The corporation may enter into quota share primary
1460	insurance agreements with authorized insurers at corporation
1461	coverage levels of 90 percent and 50 percent.
1462	c.  If the corporation determines that additional coverage
1463	levels are necessary to maximize participation in quota share
1464	primary insurance agreements by authorized insurers, the
1465	corporation may establish additional coverage levels. However,
1466	the corporation's quota share primary insurance coverage level
1467	may not exceed 90 percent.
1468	d.  Any quota share primary insurance agreement entered
1469	into between an authorized insurer and the corporation must
1470	provide for a uniform specified percentage of coverage of
1471	hurricane losses, by county or territory as set forth by the
1472	corporation board, for all eligible risks of the authorized
1473	insurer covered under the quota share primary insurance
1474	agreement.
1475	e.  Any quota share primary insurance agreement entered
1476	into between an authorized insurer and the corporation is
1477	subject to review and approval by the office. However, such
1478	agreement shall be authorized only as to insurance contracts
1479	entered into between an authorized insurer and an insured who is
1480	already insured by the corporation for wind coverage.
1481	f.  For all eligible risks covered under quota share
1482	primary insurance agreements, the exposure and coverage levels
1483	for both the corporation and authorized insurers shall be
1484	reported by the corporation to the Florida Hurricane Catastrophe
1485	Fund. For all policies of eligible risks covered under quota
1486	share primary insurance agreements, the corporation and the
1487	authorized insurer shall maintain complete and accurate records
1488	for the purpose of exposure and loss reimbursement audits as
1489	required by Florida Hurricane Catastrophe Fund rules. The
1490	corporation and the authorized insurer shall each maintain
1491	duplicate copies of policy declaration pages and supporting
1492	claims documents.
1493	g.  The corporation board shall establish in its plan of
1494	operation standards for quota share agreements which ensure that
1495	there is no discriminatory application among insurers as to the
1496	terms of quota share agreements, pricing of quota share
1497	agreements, incentive provisions if any, and consideration paid
1498	for servicing policies or adjusting claims.
1499	h.  The quota share primary insurance agreement between the
1500	corporation and an authorized insurer must set forth the
1501	specific terms under which coverage is provided, including, but
1502	not limited to, the sale and servicing of policies issued under
1503	the agreement by the insurance agent of the authorized insurer
1504	producing the business, the reporting of information concerning
1505	eligible risks, the payment of premium to the corporation, and
1506	arrangements for the adjustment and payment of hurricane claims
1507	incurred on eligible risks by the claims adjuster and personnel
1508	of the authorized insurer. Entering into a quota sharing
1509	insurance agreement between the corporation and an authorized
1510	insurer shall be voluntary and at the discretion of the
1511	authorized insurer.
1512	3.  May provide that the corporation may employ or
1513	otherwise contract with individuals or other entities to provide
1514	administrative or professional services that may be appropriate
1515	to effectuate the plan. The corporation shall have the power to
1516	borrow funds, by issuing bonds or by incurring other
1517	indebtedness, and shall have other powers reasonably necessary
1518	to effectuate the requirements of this subsection, including,
1519	without limitation, the power to issue bonds and incur other
1520	indebtedness in order to refinance outstanding bonds or other
1521	indebtedness. The corporation may, but is not required to, seek
1522	judicial validation of its bonds or other indebtedness under
1523	chapter 75. The corporation may issue bonds or incur other
1524	indebtedness, or have bonds issued on its behalf by a unit of
1525	local government pursuant to subparagraph (g)2., in the absence
1526	of a hurricane or other weather-related event, upon a
1527	determination by the corporation, subject to approval by the
1528	office, that such action would enable it to efficiently meet the
1529	financial obligations of the corporation and that such
1530	financings are reasonably necessary to effectuate the
1531	requirements of this subsection. The corporation is authorized
1532	to take all actions needed to facilitate tax-free status for any
1533	such bonds or indebtedness, including formation of trusts or
1534	other affiliated entities. The corporation shall have the
1535	authority to pledge assessments, projected recoveries from the
1536	Florida Hurricane Catastrophe Fund, other reinsurance
1537	recoverables, market equalization and other surcharges, and
1538	other funds available to the corporation as security for bonds
1539	or other indebtedness. In recognition of s. 10, Art. I of the
1540	State Constitution, prohibiting the impairment of obligations of
1541	contracts, it is the intent of the Legislature that no action be
1542	taken whose purpose is to impair any bond indenture or financing
1543	agreement or any revenue source committed by contract to such
1544	bond or other indebtedness.
1545	4.a.  Must require that the corporation operate subject to
1546	the supervision and approval of a board of governors consisting
1547	of 8 individuals who are residents of this state, from different
1548	geographical areas of this state. The Governor, the Chief
1549	Financial Officer, the President of the Senate, and the Speaker
1550	of the House of Representatives shall each appoint two members
1551	of the board, effective August 1, 2005. At least one of the two
1552	members appointed by each appointing officer must have
1553	demonstrated expertise in insurance. The Chief Financial Officer
1554	shall designate one of the appointees as chair. All board
1555	members serve at the pleasure of the appointing officer. All
1556	board members, including the chair, must be appointed to serve
1557	for 3-year terms beginning annually on a date designated by the
1558	plan. Any board vacancy shall be filled for the unexpired term
1559	by the appointing officer. The Chief Financial Officer shall
1560	appoint a technical advisory group to provide information and
1561	advice to the board of governors in connection with the board's
1562	duties under this subsection. The executive director and senior
1563	managers of the corporation shall be engaged by the board, as
1564	recommended by the Chief Financial Officer, and serve at the
1565	pleasure of the board. The executive director is responsible for
1566	employing other staff as the corporation may require, subject to
1567	review and concurrence by the board and the Chief Financial
1568	Officer.
1569	b.  The board shall create a Market Accountability Advisory
1570	Committee to assist the corporation in developing awareness of
1571	its rates and its customer and agent service levels in
1572	relationship to the voluntary market insurers writing similar
1573	coverage. The members of the advisory committee shall consist of
1574	the following 11 persons, one of whom must be elected chair by
1575	the members of the committee: four representatives, one
1576	appointed by the Florida Association of Insurance Agents, one by
1577	the Florida Association of Insurance and Financial Advisors, one
1578	by the Professional Insurance Agents of Florida, and one by the
1579	Latin American Association of Insurance Agencies; three
1580	representatives appointed by the insurers with the three highest
1581	voluntary market share of residential property insurance
1582	business in the state; one representative from the Office of
1583	Insurance Regulation; one consumer appointed by the board who is
1584	insured by the corporation at the time of appointment to the
1585	committee; one representative appointed by the Florida
1586	Association of Realtors; and one representative appointed by the
1587	Florida Bankers Association. All members must serve for 3-year
1588	terms and may serve for consecutive terms. The committee shall
1589	report to the corporation at each board meeting on insurance
1590	market issues which may include rates and rate competition with
1591	the voluntary market; service, including policy issuance, claims
1592	processing, and general responsiveness to policyholders,
1593	applicants, and agents; and matters relating to depopulation.
1594	5.  Must provide a procedure for determining the
1595	eligibility of a risk for coverage, as follows:
1596	a.  Subject to the provisions of s. 627.3517, with respect
1597	to personal lines residential risks, if the risk is offered
1598	coverage from an authorized insurer at the insurer's approved
1599	rate under either a standard policy including wind coverage or,
1600	if consistent with the insurer's underwriting rules as filed
1601	with the office, a basic policy including wind coverage, the
1602	risk is not eligible for any policy issued by the corporation.
1603	If the risk is not able to obtain any such offer, the risk is
1604	eligible for either a standard policy including wind coverage or
1605	a basic policy including wind coverage issued by the
1606	corporation; however, if the risk could not be insured under a
1607	standard policy including wind coverage regardless of market
1608	conditions, the risk shall be eligible for a basic policy
1609	including wind coverage unless rejected under subparagraph 8.
1610	The corporation shall determine the type of policy to be
1611	provided on the basis of objective standards specified in the
1612	underwriting manual and based on generally accepted underwriting
1613	practices.
1614	(I)  If the risk accepts an offer of coverage through the
1615	market assistance plan or an offer of coverage through a
1616	mechanism established by the corporation before a policy is
1617	issued to the risk by the corporation or during the first 30
1618	days of coverage by the corporation, and the producing agent who
1619	submitted the application to the plan or to the corporation is
1620	not currently appointed by the insurer, the insurer shall:
1621	(A)  Pay to the producing agent of record of the policy,
1622	for the first year, an amount that is the greater of the
1623	insurer's usual and customary commission for the type of policy
1624	written or a fee equal to the usual and customary commission of
1625	the corporation; or
1626	(B)  Offer to allow the producing agent of record of the
1627	policy to continue servicing the policy for a period of not less
1628	than 1 year and offer to pay the agent the greater of the
1629	insurer's or the corporation's usual and customary commission
1630	for the type of policy written.
1631
1632	If the producing agent is unwilling or unable to accept
1633	appointment, the new insurer shall pay the agent in accordance
1634	with sub-sub-sub-subparagraph (A).
1635	(II)  When the corporation enters into a contractual
1636	agreement for a take-out plan, the producing agent of record of
1637	the corporation policy is entitled to retain any unearned
1638	commission on the policy, and the insurer shall:
1639	(A)  Pay to the producing agent of record of the
1640	corporation policy, for the first year, an amount that is the
1641	greater of the insurer's usual and customary commission for the
1642	type of policy written or a fee equal to the usual and customary
1643	commission of the corporation; or
1644	(B)  Offer to allow the producing agent of record of the
1645	corporation policy to continue servicing the policy for a period
1646	of not less than 1 year and offer to pay the agent the greater
1647	of the insurer's or the corporation's usual and customary
1648	commission for the type of policy written.
1649
1650	If the producing agent is unwilling or unable to accept
1651	appointment, the new insurer shall pay the agent in accordance
1652	with sub-sub-sub-subparagraph (A).
1653	b.  With respect to commercial lines residential risks, if
1654	the risk is offered coverage under a policy including wind
1655	coverage from an authorized insurer at its approved rate, the
1656	risk is not eligible for any policy issued by the corporation.
1657	If the risk is not able to obtain any such offer, the risk is
1658	eligible for a policy including wind coverage issued by the
1659	corporation.
1660	(I)  If the risk accepts an offer of coverage through the
1661	market assistance plan or an offer of coverage through a
1662	mechanism established by the corporation before a policy is
1663	issued to the risk by the corporation or during the first 30
1664	days of coverage by the corporation, and the producing agent who
1665	submitted the application to the plan or the corporation is not
1666	currently appointed by the insurer, the insurer shall:
1667	(A)  Pay to the producing agent of record of the policy,
1668	for the first year, an amount that is the greater of the
1669	insurer's usual and customary commission for the type of policy
1670	written or a fee equal to the usual and customary commission of
1671	the corporation; or
1672	(B)  Offer to allow the producing agent of record of the
1673	policy to continue servicing the policy for a period of not less
1674	than 1 year and offer to pay the agent the greater of the
1675	insurer's or the corporation's usual and customary commission
1676	for the type of policy written.
1677
1678	If the producing agent is unwilling or unable to accept
1679	appointment, the new insurer shall pay the agent in accordance
1680	with sub-sub-sub-subparagraph (A).
1681	(II)  When the corporation enters into a contractual
1682	agreement for a take-out plan, the producing agent of record of
1683	the corporation policy is entitled to retain any unearned
1684	commission on the policy, and the insurer shall:
1685	(A)  Pay to the producing agent of record of the
1686	corporation policy, for the first year, an amount that is the
1687	greater of the insurer's usual and customary commission for the
1688	type of policy written or a fee equal to the usual and customary
1689	commission of the corporation; or
1690	(B)  Offer to allow the producing agent of record of the
1691	corporation policy to continue servicing the policy for a period
1692	of not less than 1 year and offer to pay the agent the greater
1693	of the insurer's or the corporation's usual and customary
1694	commission for the type of policy written.
1695
1696	If the producing agent is unwilling or unable to accept
1697	appointment, the new insurer shall pay the agent in accordance
1698	with sub-sub-sub-subparagraph (A).
1699	c.  To preserve existing incentives for carriers to write
1700	dwellings in the voluntary market and not in the corporation,
1701	the corporation shall continue to offer authorized insurers,
1702	including insurers writing dwellings valued at $1 million or
1703	more, the same voluntary writing credits that were available on
1704	January 1, 2006, to carriers writing wind coverage for dwellings
1705	in the areas eligible for coverage in the high-risk account.
1706	d.  With respect to personal lines residential risks, if
1707	the risk is a dwelling with an insured value of $1 million or
1708	more, or if the risk is one that is excluded from the coverage
1709	to be provided by the condominium association under s.
1710	718.111(11)(b) and that is insured by the condominium unit owner
1711	for a combined dwelling and contents replacement cost of $1
1712	million or more, the risk is not eligible for any policy issued
1713	by the corporation. Rates and forms for personal lines
1714	residential risks not eligible for coverage by the corporation
1715	specified by this sub-subparagraph are not subject to ss.
1716	627.062 and 627.0629. Such rates and forms are subject to all
1717	other applicable provisions of this code and rules adopted under
1718	this code. During the course of an insurer's market conduct
1719	examination, the office may review the rate for any risk to
1720	which the provisions of this sub-subparagraph are applicable to
1721	determine if such rate is inadequate or unfairly discriminatory.
1722	Rates on personal lines residential risks not eligible for
1723	coverage by the corporation may be found inadequate by the
1724	office if they are clearly insufficient, together with the
1725	investment income attributable to such risks, to sustain
1726	projected losses and expenses in the class of business to which
1727	such rates apply. Rates on personal lines residential risks not
1728	eligible for coverage by the corporation may also be found
1729	inadequate as to the premium charged to a risk or group of risks
1730	if discounts or credits are allowed that exceed a reasonable
1731	reflection of expense savings and reasonably expected loss
1732	experience from the risk or group of risks. Rates on personal
1733	lines residential risks not eligible for coverage by the
1734	corporation may be found to be unfairly discriminatory as to a
1735	risk or group of risks by the office if the application of
1736	premium discounts, credits, or surcharges among such risks does
1737	not bear a reasonable relationship to the expected loss and
1738	expense experience among the various risks. A rating plan,
1739	including discounts, credits, or surcharges on personal lines
1740	residential risks not eligible for coverage by the corporation
1741	may also be found to be unfairly discriminatory if the plan
1742	fails to clearly and equitably reflect consideration of the
1743	policyholder's participation in a risk management program
1744	adjusted pursuant to s. 627.0625. The office may order an
1745	insurer to discontinue using a rate for new policies or upon
1746	renewal of a policy if the office finds the rate to be
1747	inadequate or unfairly discriminatory. Insurers must maintain
1748	records and documentation relating to rates and forms subject to
1749	this sub-subparagraph for a period of at least 5 years after the
1750	effective date of the policy.
1751	e.  For policies subject to nonrenewal as a result of the
1752	risk being no longer eligible for coverage pursuant to sub-
1753	subparagraph d., the corporation shall, directly or through the
1754	market assistance plan, make information from confidential
1755	underwriting and claims files of policyholders available only to
1756	licensed general lines agents who register with the corporation
1757	to receive such information according to the following
1758	procedures:
1759	(I)  By August 1, 2006, the corporation shall provide
1760	policyholders who are not eligible for renewal pursuant to sub-
1761	subparagraph d. the opportunity to request in writing, within 30
1762	days after the notification is sent, that information from their
1763	confidential underwriting and claims files not be released to
1764	licensed general lines agents registered pursuant to sub-sub-
1765	subparagraph e.(II);
1766	(II)  By August 1, 2006, the corporation shall make
1767	available to licensed general lines agents the registration
1768	procedures to be used to obtain confidential information from
1769	underwriting and claims files for policies not eligible for
1770	renewal pursuant to sub-subparagraph d. As a condition of
1771	registration, the corporation shall require the licensed general
1772	lines agent to attest that the agent has the experience and
1773	relationships with authorized or surplus lines carriers to
1774	attempt to offer replacement coverage for policies not eligible
1775	for renewal pursuant to sub-subparagraph d.
1776	(III)  By September 1, 2006, the corporation shall make
1777	available through a secured website to licensed general lines
1778	agents registered pursuant to sub-sub-subparagraph e.(II)
1779	application, rating, loss history, mitigation, and policy type
1780	information relating to all policies not eligible for renewal
1781	pursuant to sub-subparagraph d. and for which the policyholder
1782	has not requested the corporation withhold such information
1783	pursuant to sub-sub-subparagraph e.(I). The licensed general
1784	lines agent registered pursuant to sub-sub-subparagraph e.(II)
1785	may use such information to contact and assist the policyholder
1786	in securing replacement policies and the agent may disclose to
1787	the policyholder such information was obtained from the
1788	corporation.
1789	f.  With respect to nonhomestead property, eligibility must
1790	be determined in accordance with sub-sub-sub-subparagraph
1791	(b)2.a.(II)(A).
1792	6.  Must include rules for classifications of risks and
1793	rates therefor.
1794	7.  Must provide that if premium and investment income for
1795	an account attributable to a particular calendar year are in
1796	excess of projected losses and expenses for the account
1797	attributable to that year, such excess shall be held in surplus
1798	in the account. Such surplus shall be available to defray
1799	deficits in that account as to future years and shall be used
1800	for that purpose prior to assessing assessable insurers and
1801	assessable insureds as to any calendar year.
1802	8.  Must provide objective criteria and procedures to be
1803	uniformly applied for all applicants in determining whether an
1804	individual risk is so hazardous as to be uninsurable. In making
1805	this determination and in establishing the criteria and
1806	procedures, the following shall be considered:
1807	a.  Whether the likelihood of a loss for the individual
1808	risk is substantially higher than for other risks of the same
1809	class; and
1810	b.  Whether the uncertainty associated with the individual
1811	risk is such that an appropriate premium cannot be determined.
1812
1813	The acceptance or rejection of a risk by the corporation shall
1814	be construed as the private placement of insurance, and the
1815	provisions of chapter 120 shall not apply.
1816	9.  Must provide that the corporation shall make its best
1817	efforts to procure catastrophe reinsurance at reasonable rates,
1818	to cover its projected 100-year probable maximum loss in the
1819	homestead accounts as determined by the board of governors.
1820	10.  Must provide that in the event of regular deficit
1821	assessments under sub-subparagraph (b)3.a. or sub-subparagraph
1822	(b)3.b., in the personal lines homestead account, the commercial
1823	lines residential homestead account, or the high-risk homestead
1824	account, the corporation shall levy upon corporation homestead
1825	account policyholders in its next rate filing, or by a separate
1826	rate filing solely for this purpose, a Citizens policyholder
1827	market equalization surcharge arising from a regular assessment
1828	in such account in a percentage equal to the total amount of
1829	such regular assessments divided by the aggregate statewide
1830	direct written premium for subject lines of business for the
1831	prior calendar year preceding the year in which the deficit to
1832	which the regular assessment related is incurred. Citizens
1833	policyholder Market equalization surcharges under this
1834	subparagraph are not considered premium and are not subject to
1835	commissions, fees, or premium taxes; however, failure to pay the
1836	Citizens policyholder a market equalization surcharge shall be
1837	treated as failure to pay premium. Notwithstanding any other
1838	provision of this section, for purposes of the Citizens
1839	policyholder surcharges to be levied pursuant to this
1840	subparagraph, the total amount of the regular assessment to
1841	which such Citizens policyholder surcharge relates shall be
1842	determined as set forth in sub-subparagraphs (b)3.a., b., and c.
1843	11.  The policies issued by the corporation must provide
1844	that, if the corporation or the market assistance plan obtains
1845	an offer from an authorized insurer to cover the risk at its
1846	approved rates, the risk is no longer eligible for renewal
1847	through the corporation.
1848	12.  Corporation policies and applications must include a
1849	notice that the corporation policy could, under this section, be
1850	replaced with a policy issued by an authorized insurer that does
1851	not provide coverage identical to the coverage provided by the
1852	corporation or an insurer writing coverage pursuant to part VIII
1853	of chapter 626. The notice shall also specify that acceptance of
1854	corporation coverage creates a conclusive presumption that the
1855	applicant or policyholder is aware of this potential.
1856	13.  May establish, subject to approval by the office,
1857	different eligibility requirements and operational procedures
1858	for any line or type of coverage for any specified county or
1859	area if the board determines that such changes to the
1860	eligibility requirements and operational procedures are
1861	justified due to the voluntary market being sufficiently stable
1862	and competitive in such area or for such line or type of
1863	coverage and that consumers who, in good faith, are unable to
1864	obtain insurance through the voluntary market through ordinary
1865	methods would continue to have access to coverage from the
1866	corporation. When coverage is sought in connection with a real
1867	property transfer, such requirements and procedures shall not
1868	provide for an effective date of coverage later than the date of
1869	the closing of the transfer as established by the transferor,
1870	the transferee, and, if applicable, the lender.
1871	14.  Must provide that, with respect to the high-risk
1872	homestead account, any assessable insurer with a surplus as to
1873	policyholders of $25 million or less writing 25 percent or more
1874	of its total countrywide property insurance premiums in this
1875	state may petition the office, within the first 90 days of each
1876	calendar year, to qualify as a limited apportionment company. In
1877	no event shall a limited apportionment company be required to
1878	participate in the portion of any assessment, within the high-
1879	risk account, pursuant to sub-subparagraph (b)3.a. or sub-
1880	subparagraph (b)3.b. in the aggregate which exceeds $50 million
1881	after payment of available high-risk account funds in any
1882	calendar year. However, a limited apportionment company shall
1883	collect from its policyholders any emergency assessment imposed
1884	under sub-subparagraph (b)3.d. The plan shall provide that, if
1885	the office determines that any regular assessment will result in
1886	an impairment of the surplus of a limited apportionment company,
1887	the office may direct that all or part of such assessment be
1888	deferred as provided in subparagraph (g)4. However, there shall
1889	be no limitation or deferment of an emergency assessment to be
1890	collected from policyholders under sub-subparagraph (b)3.d.
1891	15.  Must provide that the corporation appoint as its
1892	licensed agents only those agents who also hold an appointment
1893	as defined in s. 626.015(3) with an insurer who at the time of
1894	the agent's initial appointment by the corporation is authorized
1895	to write and is actually writing personal lines residential
1896	property coverage, commercial residential property coverage, or
1897	commercial nonresidential property coverage within the state.
1898	16.  Must provide that the hurricane deductible for any
1899	property in the nonhomestead account with an insured value of
1900	$250,000 or more must be at least 5 percent of the insured
1901	value.
1902	17.  Must provide that the application for coverage under
1903	the nonhomestead account and the declaration page of each
1904	nonhomestead account policy include a statement in boldface 12-
1905	point type specifying that public subsidies do not support the
1906	corporation's coverage of nonhomestead property; that if the
1907	nonhomestead account of the corporation sustains a deficit or is
1908	unable to pay claims, the nonhomestead policyholder shall be
1909	subject to an immediate assessment in an amount up to 100
1910	percent of the premium and a further assessment upon renewal of
1911	the policy; and that the applicant or policyholder may wish to
1912	seek alternative coverage from an authorized insurer or surplus
1913	lines insurer that will not be subject to such potential
1914	assessments.
1915	18.  Must provide that the application for coverage under
1916	any of the homestead accounts and the declaration page of each
1917	homestead account policy include a statement in boldface 12-
1918	point type specifying that a false declaration of homestead
1919	status for purposes of obtaining coverage in any of the
1920	homestead accounts may constitute the offense of insurance
1921	fraud, as prohibited and punishable as a felony under s.
1922	817.234.
1923	19.  Must provide for purchase by the corporation of
1924	catastrophe reinsurance on the nonhomestead account in amounts
1925	sufficient, together with coverage under the Florida Hurricane
1926	Catastrophe Fund, to cover the account's 250-year probable
1927	maximum loss.
1928	(d)1.a.  It is the intent of the Legislature that the rates
1929	for coverage provided by the corporation be actuarially sound
1930	and not competitive with approved rates charged in the admitted
1931	voluntary market, so that the corporation functions as a
1932	residual market mechanism to provide insurance only when the
1933	insurance cannot be procured in the voluntary market. Rates
1934	shall include a residual market risk load that reflects the
1935	concentrated exposure of the corporation and the impact of
1936	adverse selection as well as an appropriate catastrophe loading
1937	factor that reflects the actual catastrophic exposure of the
1938	corporation.
1939	b.  It is the intent of the Legislature to reaffirm the
1940	requirement of rate adequacy in the residual market. Recognizing
1941	that rates may comply with the intent expressed in sub-
1942	subparagraph a. and yet be inadequate and recognizing the public
1943	need to limit subsidies within the residual market, it is the
1944	further intent of the Legislature to establish statutory
1945	standards for rate adequacy. Such standards are intended to
1946	supplement the standard specified in s. 627.062(2)(e)3.,
1947	providing that rates are inadequate if they are clearly
1948	insufficient to sustain projected losses and expenses in the
1949	class of business to which they apply.
1950	2.  For each county, the average rates of the corporation
1951	for each line of business for personal lines residential
1952	policies excluding rates for wind-only policies shall be no
1953	lower than the average rates charged by the insurer that had the
1954	highest average rate in that county among the 20 insurers with
1955	the greatest total direct written premium in the state for that
1956	line of business in the preceding year, except that with respect
1957	to mobile home coverages, the average rates of the corporation
1958	shall be no lower than the average rates charged by the insurer
1959	that had the highest average rate in that county among the 5
1960	insurers with the greatest total written premium for mobile home
1961	owner's policies in the state in the preceding year.
1962	3.  Rates for personal lines residential wind-only policies
1963	must be actuarially sound and not competitive with approved
1964	rates charged by authorized insurers. Corporation rate manuals
1965	shall include a rate surcharge for seasonal occupancy. To ensure
1966	that personal lines residential wind-only rates are not
1967	competitive with approved rates charged by authorized insurers,
1968	the corporation, in conjunction with the office, shall develop a
1969	wind-only ratemaking methodology, which methodology shall be
1970	contained in each rate filing made by the corporation with the
1971	office. If the office determines that the wind-only rates or
1972	rating factors filed by the corporation fail to comply with the
1973	wind-only ratemaking methodology provided for in this
1974	subsection, it shall so notify the corporation and require the
1975	corporation to amend its rates or rating factors to come into
1976	compliance within 90 days of notice from the office.
1977	4.  For the purposes of establishing a pilot program to
1978	evaluate issues relating to the availability and affordability
1979	of insurance in an area where historically there has been little
1980	market competition, the provisions of subparagraph 2. do not
1981	apply to coverage provided by the corporation in Monroe County
1982	if the office determines that a reasonable degree of competition
1983	does not exist for personal lines residential policies. The
1984	provisions of subparagraph 3. do not apply to coverage provided
1985	by the corporation in Monroe County if the office determines
1986	that a reasonable degree of competition does not exist for
1987	personal lines residential policies in the area of that county
1988	which is eligible for wind-only coverage. In this county, the
1989	rates for personal lines residential coverage shall be
1990	actuarially sound and not excessive, inadequate, or unfairly
1991	discriminatory and are subject to the other provisions of the
1992	paragraph and s. 627.062. The commission shall adopt rules
1993	establishing the criteria for determining whether a reasonable
1994	degree of competition exists for personal lines residential
1995	policies in Monroe County. By March 1, 2006, the office shall
1996	submit a report to the Legislature providing an evaluation of
1997	the implementation of the pilot program affecting Monroe County.
1998	5.  Rates for commercial lines coverage shall not be
1999	subject to the requirements of subparagraph 2., but shall be
2000	subject to all other requirements of this paragraph and s.
2001	627.062.
2002	6.a.  Nothing in this paragraph shall require or allow the
2003	corporation to adopt a rate that is inadequate under s. 627.062
2004	or under sub-subparagraph b. or sub-subparagraph c.
2005	b.  With respect to rates for coverage in any homestead
2006	account, a rate is deemed inadequate if the rate is not
2007	sufficient to generate, by means of cash flow, procurement of
2008	coverage under the Florida Hurricane Catastrophe Fund;
2009	procurement of reinsurance; and investment income, moneys
2010	sufficient to pay all claims and expenses reasonably expected to
2011	result from a 100-year probable maximum loss event without
2012	resort to any regular or emergency assessments, long-term debt,
2013	state revenues, or other funding sources that reflect any
2014	subsidy from persons or entities other than corporation
2015	homestead accounts policyholders.
2016	c.  With respect to rates for coverage in the nonhomestead
2017	account, a rate is deemed inadequate if the rate is not
2018	sufficient to generate, by means of cash flow, procurement of
2019	coverage under the Florida Hurricane Catastrophe Fund;
2020	procurement of reinsurance; and investment income, moneys
2021	sufficient to pay all claims and expenses reasonably expected to
2022	result from a 250-year probable maximum loss event without
2023	resort to any assessments, debt, state revenues, or other
2024	funding sources that reflect any subsidy from persons or
2025	entities other than corporation nonhomestead account
2026	policyholders.
2027	7.  The corporation shall certify to the office at least
2028	twice annually that its personal lines rates comply with the
2029	requirements of subparagraphs 1., and 2., and 6. If any
2030	adjustment in the rates or rating factors of the corporation is
2031	necessary to ensure such compliance, the corporation shall make
2032	and implement such adjustments and file its revised rates and
2033	rating factors with the office. If the office thereafter
2034	determines that the revised rates and rating factors fail to
2035	comply with the provisions of subparagraphs 1. and 2., it shall
2036	notify the corporation and require the corporation to amend its
2037	rates or rating factors in conjunction with its next rate
2038	filing. The office must notify the corporation by electronic
2039	means of any rate filing it approves for any insurer among the
2040	insurers referred to in subparagraph 2.
2041	8.  In addition to the rates otherwise determined pursuant
2042	to this paragraph, the corporation shall impose and collect an
2043	amount equal to the premium tax provided for in s. 624.509 to
2044	augment the financial resources of the corporation.
2045	9.a.  To assist the corporation in developing additional
2046	ratemaking methods to assure compliance with subparagraphs 1.
2047	and 4., the corporation shall appoint a rate methodology panel
2048	consisting of one person recommended by the Florida Association
2049	of Insurance Agents, one person recommended by the Professional
2050	Insurance Agents of Florida, one person recommended by the
2051	Florida Association of Insurance and Financial Advisors, one
2052	person recommended by the insurer with the highest voluntary
2053	market share of residential property insurance business in the
2054	state, one person recommended by the insurer with the second-
2055	highest voluntary market share of residential property insurance
2056	business in the state, one person recommended by an insurer
2057	writing commercial residential property insurance in this state,
2058	one person recommended by the Office of Insurance Regulation,
2059	and one board member designated by the board chairman, who shall
2060	serve as chairman of the panel.
2061	b.  By January 1, 2004, the rate methodology panel shall
2062	provide a report to the corporation of its findings and
2063	recommendations for the use of additional ratemaking methods and
2064	procedures, including the use of a rate equalization surcharge
2065	in an amount sufficient to assure that the total cost of
2066	coverage for policyholders or applicants to the corporation is
2067	sufficient to comply with subparagraph 1.
2068	c.  Within 30 days after such report, the corporation shall
2069	present to the President of the Senate, the Speaker of the House
2070	of Representatives, the minority party leaders of each house of
2071	the Legislature, and the chairs of the standing committees of
2072	each house of the Legislature having jurisdiction of insurance
2073	issues, a plan for implementing the additional ratemaking
2074	methods and an outline of any legislation needed to facilitate
2075	use of the new methods.
2076	d.  The plan must include a provision that producer
2077	commissions paid by the corporation shall not be calculated in
2078	such a manner as to include any rate equalization surcharge.
2079	However, without regard to the plan to be developed or its
2080	implementation, producer commissions paid by the corporation for
2081	each account, other than the quota share primary program, shall
2082	remain fixed as to percentage, effective rate, calculation, and
2083	payment method until January 1, 2004.
2084	9.10.  By January 1, 2004, The corporation shall provide
2085	develop a notice to policyholders or applicants that the rates
2086	of Citizens Property Insurance Corporation are intended to be
2087	higher than the rates of any admitted carrier and providing
2088	other information the corporation deems necessary to assist
2089	consumers in finding other voluntary admitted insurers willing
2090	to insure their property.
2091	(e)  If coverage in an account is deactivated pursuant to
2092	paragraph (f), coverage through the corporation shall be
2093	reactivated by order of the office only under one of the
2094	following circumstances:
2095	1.  If the market assistance plan receives a minimum of 100
2096	applications for coverage within a 3-month period, or 200
2097	applications for coverage within a 1-year period or less for
2098	residential coverage, unless the market assistance plan provides
2099	a quotation from admitted carriers at their filed rates for at
2100	least 90 percent of such applicants. Any market assistance plan
2101	application that is rejected because an individual risk is so
2102	hazardous as to be uninsurable using the criteria specified in
2103	subparagraph (c)8. shall not be included in the minimum
2104	percentage calculation provided herein. In the event that there
2105	is a legal or administrative challenge to a determination by the
2106	office that the conditions of this subparagraph have been met
2107	for eligibility for coverage in the corporation, any eligible
2108	risk may obtain coverage during the pendency of such challenge.
2109	2.  In response to a state of emergency declared by the
2110	Governor under s. 252.36, the office may activate coverage by
2111	order for the period of the emergency upon a finding by the
2112	office that the emergency significantly affects the availability
2113	of residential property insurance.
2114	(f)1.  The corporation shall file with the office quarterly
2115	statements of financial condition, an annual statement of
2116	financial condition, and audited financial statements in the
2117	manner prescribed by law. In addition, the corporation shall
2118	report to the office monthly on the types, premium, exposure,
2119	and distribution by county of its policies in force, and shall
2120	submit other reports as the office requires to carry out its
2121	oversight of the corporation.
2122	2.  The activities of the corporation shall be reviewed at
2123	least annually by the office to determine whether coverage shall
2124	be deactivated in an account on the basis that the conditions
2125	giving rise to its activation no longer exist.
2126	(g)1.  The corporation shall certify to the office its
2127	needs for annual assessments as to a particular calendar year,
2128	and for any interim assessments that it deems to be necessary to
2129	sustain operations as to a particular year pending the receipt
2130	of annual assessments. Upon verification, the office shall
2131	approve such certification, and the corporation shall levy such
2132	annual or interim assessments. Such assessments shall be
2133	prorated as provided in paragraph (b). The corporation shall
2134	take all reasonable and prudent steps necessary to collect the
2135	amount of assessment due from each assessable insurer,
2136	including, if prudent, filing suit to collect such assessment.
2137	If the corporation is unable to collect an assessment from any
2138	assessable insurer, the uncollected assessments shall be levied
2139	as an additional assessment against the assessable insurers and
2140	any assessable insurer required to pay an additional assessment
2141	as a result of such failure to pay shall have a cause of action
2142	against such nonpaying assessable insurer. Assessments shall be
2143	included as an appropriate factor in the making of rates. The
2144	failure of a surplus lines agent to collect and remit any
2145	regular or emergency assessment levied by the corporation is
2146	considered to be a violation of s. 626.936 and subjects the
2147	surplus lines agent to the penalties provided in that section.
2148	2.  The governing body of any unit of local government, any
2149	residents of which are insured by the corporation, may issue
2150	bonds as defined in s. 125.013 or s. 166.101 from time to time
2151	to fund an assistance program, in conjunction with the
2152	corporation, for the purpose of defraying deficits of the
2153	corporation. In order to avoid needless and indiscriminate
2154	proliferation, duplication, and fragmentation of such assistance
2155	programs, any unit of local government, any residents of which
2156	are insured by the corporation, may provide for the payment of
2157	losses, regardless of whether or not the losses occurred within
2158	or outside of the territorial jurisdiction of the local
2159	government. Revenue bonds under this subparagraph may not be
2160	issued until validated pursuant to chapter 75, unless a state of
2161	emergency is declared by executive order or proclamation of the
2162	Governor pursuant to s. 252.36 making such findings as are
2163	necessary to determine that it is in the best interests of, and
2164	necessary for, the protection of the public health, safety, and
2165	general welfare of residents of this state and declaring it an
2166	essential public purpose to permit certain municipalities or
2167	counties to issue such bonds as will permit relief to claimants
2168	and policyholders of the corporation. Any such unit of local
2169	government may enter into such contracts with the corporation
2170	and with any other entity created pursuant to this subsection as
2171	are necessary to carry out this paragraph. Any bonds issued
2172	under this subparagraph shall be payable from and secured by
2173	moneys received by the corporation from emergency assessments
2174	under sub-subparagraph (b)3.d., and assigned and pledged to or
2175	on behalf of the unit of local government for the benefit of the
2176	holders of such bonds. The funds, credit, property, and taxing
2177	power of the state or of the unit of local government shall not
2178	be pledged for the payment of such bonds. If any of the bonds
2179	remain unsold 60 days after issuance, the office shall require
2180	all insurers subject to assessment to purchase the bonds, which
2181	shall be treated as admitted assets; each insurer shall be
2182	required to purchase that percentage of the unsold portion of
2183	the bond issue that equals the insurer's relative share of
2184	assessment liability under this subsection. An insurer shall not
2185	be required to purchase the bonds to the extent that the office
2186	determines that the purchase would endanger or impair the
2187	solvency of the insurer.
2188	3.a.  The corporation shall adopt one or more programs
2189	subject to approval by the office for the reduction of both new
2190	and renewal writings in the corporation. Any program the
2191	corporation adopts for the payment of bonuses to an insurer for
2192	each risk the insurer removes from the corporation shall comply
2193	with s. 627.3511(2) and may not exceed the amount referenced in
2194	s. 627.3511(2) for each risk removed. The corporation may
2195	consider any prudent and not unfairly discriminatory approach to
2196	reducing corporation writings, and may adopt a credit against
2197	assessment liability or other liability that provides an
2198	incentive for insurers to take risks out of the corporation and
2199	to keep risks out of the corporation by maintaining or
2200	increasing voluntary writings in counties or areas in which
2201	corporation risks are highly concentrated and a program to
2202	provide a formula under which an insurer voluntarily taking
2203	risks out of the corporation by maintaining or increasing
2204	voluntary writings will be relieved wholly or partially from
2205	assessments under sub-subparagraphs (b)3.a. and b. When the
2206	corporation enters into a contractual agreement for a take-out
2207	plan, the producing agent of record of the corporation policy is
2208	entitled to retain any unearned commission on such policy, and
2209	the insurer shall either:
2210	(I)  Pay to the producing agent of record of the policy,
2211	for the first year, an amount which is the greater of the
2212	insurer's usual and customary commission for the type of policy
2213	written or a policy fee equal to the usual and customary
2214	commission of the corporation; or
2215	(II)  Offer to allow the producing agent of record of the
2216	policy to continue servicing the policy for a period of not less
2217	than 1 year and offer to pay the agent the insurer's usual and
2218	customary commission for the type of policy written. If the
2219	producing agent is unwilling or unable to accept appointment by
2220	the new insurer, the new insurer shall pay the agent in
2221	accordance with sub-sub-subparagraph (I).
2222	b.  Any credit or exemption from regular assessments
2223	adopted under this subparagraph shall last no longer than the 3
2224	years following the cancellation or expiration of the policy by
2225	the corporation. With the approval of the office, the board may
2226	extend such credits for an additional year if the insurer
2227	guarantees an additional year of renewability for all policies
2228	removed from the corporation, or for 2 additional years if the
2229	insurer guarantees 2 additional years of renewability for all
2230	policies so removed.
2231	c.  There shall be no credit, limitation, exemption, or
2232	deferment from emergency assessments to be collected from
2233	policyholders pursuant to sub-subparagraph (b)3.d.
2234	4.  The plan shall provide for the deferment, in whole or
2235	in part, of the assessment of an assessable insurer, other than
2236	an emergency assessment collected from policyholders pursuant to
2237	sub-subparagraph (b)3.d., if the office finds that payment of
2238	the assessment would endanger or impair the solvency of the
2239	insurer. In the event an assessment against an assessable
2240	insurer is deferred in whole or in part, the amount by which
2241	such assessment is deferred may be assessed against the other
2242	assessable insurers in a manner consistent with the basis for
2243	assessments set forth in paragraph (b).
2244	(h)  Nothing in this subsection shall be construed to
2245	preclude the issuance of residential property insurance coverage
2246	pursuant to part VIII of chapter 626.
2247	(i)  There shall be no liability on the part of, and no
2248	cause of action of any nature shall arise against, any
2249	assessable insurer or its agents or employees, the corporation
2250	or its agents or employees, members of the board of governors or
2251	their respective designees at a board meeting, corporation
2252	committee members, or the office or its representatives, for any
2253	action taken by them in the performance of their duties or
2254	responsibilities under this subsection. Such immunity does not
2255	apply to:
2256	1.  Any of the foregoing persons or entities for any
2257	willful tort;
2258	2.  The corporation or its producing agents for breach of
2259	any contract or agreement pertaining to insurance coverage;
2260	3.  The corporation with respect to issuance or payment of
2261	debt; or
2262	4.  Any assessable insurer with respect to any action to
2263	enforce an assessable insurer's obligations to the corporation
2264	under this subsection.
2265	(j)  For the purposes of s. 199.183(1), the corporation
2266	shall be considered a political subdivision of the state and
2267	shall be exempt from the corporate income tax. The premiums,
2268	assessments, investment income, and other revenue of the
2269	corporation are funds received for providing property insurance
2270	coverage as required by this subsection, paying claims for
2271	Florida citizens insured by the corporation, securing and
2272	repaying debt obligations issued by the corporation, and
2273	conducting all other activities of the corporation, and shall
2274	not be considered taxes, fees, licenses, or charges for services
2275	imposed by the Legislature on individuals, businesses, or
2276	agencies outside state government. Bonds and other debt
2277	obligations issued by or on behalf of the corporation are not to
2278	be considered "state bonds" within the meaning of s. 215.58(8).
2279	The corporation is not subject to the procurement provisions of
2280	chapter 287, and policies and decisions of the corporation
2281	relating to incurring debt, levying of assessments and the sale,
2282	issuance, continuation, terms and claims under corporation
2283	policies, and all services relating thereto, are not subject to
2284	the provisions of chapter 120. The corporation is not required
2285	to obtain or to hold a certificate of authority issued by the
2286	office, nor is it required to participate as a member insurer of
2287	the Florida Insurance Guaranty Association. However, the
2288	corporation is required to pay, in the same manner as an
2289	authorized insurer, assessments pledged by the Florida Insurance
2290	Guaranty Association to secure bonds issued or other
2291	indebtedness incurred to pay covered claims arising from insurer
2292	insolvencies caused by, or proximately related to, hurricane
2293	losses. It is the intent of the Legislature that the tax
2294	exemptions provided in this paragraph will augment the financial
2295	resources of the corporation to better enable the corporation to
2296	fulfill its public purposes. Any debt obligations bonds issued
2297	by the corporation, their transfer, and the income therefrom,
2298	including any profit made on the sale thereof, shall at all
2299	times be free from taxation of every kind by the state and any
2300	political subdivision or local unit or other instrumentality
2301	thereof; however, this exemption does not apply to any tax
2302	imposed by chapter 220 on interest, income, or profits on debt
2303	obligations owned by corporations other than the corporation.
2304	(k)  Upon a determination by the office that the conditions
2305	giving rise to the establishment and activation of the
2306	corporation no longer exist, the corporation is dissolved. Upon
2307	dissolution, the assets of the corporation shall be applied
2308	first to pay all debts, liabilities, and obligations of the
2309	corporation, including the establishment of reasonable reserves
2310	for any contingent liabilities or obligations, and all remaining
2311	assets of the corporation shall become property of the state and
2312	shall be deposited in the Florida Hurricane Catastrophe Fund.
2313	However, no dissolution shall take effect as long as the
2314	corporation has bonds or other financial obligations outstanding
2315	unless adequate provision has been made for the payment of the
2316	bonds or other financial obligations pursuant to the documents
2317	authorizing the issuance of the bonds or other financial
2318	obligations.
2319	(l)1.  Effective July 1, 2002, policies of the Residential
2320	Property and Casualty Joint Underwriting Association shall
2321	become policies of the corporation. All obligations, rights,
2322	assets and liabilities of the Residential Property and Casualty
2323	Joint Underwriting Association, including bonds, note and debt
2324	obligations, and the financing documents pertaining to them
2325	become those of the corporation as of July 1, 2002. The
2326	corporation is not required to issue endorsements or
2327	certificates of assumption to insureds during the remaining term
2328	of in-force transferred policies.
2329	2.  Effective July 1, 2002, policies of the Florida
2330	Windstorm Underwriting Association are transferred to the
2331	corporation and shall become policies of the corporation. All
2332	obligations, rights, assets, and liabilities of the Florida
2333	Windstorm Underwriting Association, including bonds, note and
2334	debt obligations, and the financing documents pertaining to them
2335	are transferred to and assumed by the corporation on July 1,
2336	2002. The corporation is not required to issue endorsement or
2337	certificates of assumption to insureds during the remaining term
2338	of in-force transferred policies.
2339	3.  The Florida Windstorm Underwriting Association and the
2340	Residential Property and Casualty Joint Underwriting Association
2341	shall take all actions as may be proper to further evidence the
2342	transfers and shall provide the documents and instruments of
2343	further assurance as may reasonably be requested by the
2344	corporation for that purpose. The corporation shall execute
2345	assumptions and instruments as the trustees or other parties to
2346	the financing documents of the Florida Windstorm Underwriting
2347	Association or the Residential Property and Casualty Joint
2348	Underwriting Association may reasonably request to further
2349	evidence the transfers and assumptions, which transfers and
2350	assumptions, however, are effective on the date provided under
2351	this paragraph whether or not, and regardless of the date on
2352	which, the assumptions or instruments are executed by the
2353	corporation. Subject to the relevant financing documents
2354	pertaining to their outstanding bonds, notes, indebtedness, or
2355	other financing obligations, the moneys, investments,
2356	receivables, choses in action, and other intangibles of the
2357	Florida Windstorm Underwriting Association shall be credited to
2358	the high-risk account of the corporation, and those of the
2359	personal lines residential coverage account and the commercial
2360	lines residential coverage account of the Residential Property
2361	and Casualty Joint Underwriting Association shall be credited to
2362	the personal lines account and the commercial lines account,
2363	respectively, of the corporation.
2364	4.  Effective July 1, 2002, a new applicant for property
2365	insurance coverage who would otherwise have been eligible for
2366	coverage in the Florida Windstorm Underwriting Association is
2367	eligible for coverage from the corporation as provided in this
2368	subsection.
2369	4.5.  The transfer of all policies, obligations, rights,
2370	assets, and liabilities from the Florida Windstorm Underwriting
2371	Association to the corporation and the renaming of the
2372	Residential Property and Casualty Joint Underwriting Association
2373	as the corporation shall in no way affect the coverage with
2374	respect to covered policies as defined in s. 215.555(2)(c)
2375	provided to these entities by the Florida Hurricane Catastrophe
2376	Fund. The coverage provided by the Florida Hurricane Catastrophe
2377	Fund to the Florida Windstorm Underwriting Association based on
2378	its exposures as of June 30, 2002, and each June 30 thereafter
2379	shall be redesignated as coverage for the high-risk account of
2380	the corporation. Notwithstanding any other provision of law, the
2381	coverage provided by the Florida Hurricane Catastrophe Fund to
2382	the Residential Property and Casualty Joint Underwriting
2383	Association based on its exposures as of June 30, 2002, and each
2384	June 30 thereafter shall be transferred to the personal lines
2385	account and the commercial lines account of the corporation.
2386	Notwithstanding any other provision of law, the high-risk
2387	account shall be treated, for all Florida Hurricane Catastrophe
2388	Fund purposes, as if it were a separate participating insurer
2389	with its own exposures, reimbursement premium, and loss
2390	reimbursement. Likewise, the personal lines and commercial lines
2391	accounts shall be viewed together, for all Florida Hurricane
2392	Catastrophe Fund purposes, as if the two accounts were one and
2393	represent a single, separate participating insurer with its own
2394	exposures, reimbursement premium, and loss reimbursement. The
2395	coverage provided by the Florida Hurricane Catastrophe Fund to
2396	the corporation shall constitute and operate as a full transfer
2397	of coverage from the Florida Windstorm Underwriting Association
2398	and Residential Property and Casualty Joint Underwriting to the
2399	corporation.
2400	(m)  Notwithstanding any other provision of law:
2401	1.  The pledge or sale of, the lien upon, and the security
2402	interest in any rights, revenues, or other assets of the
2403	corporation created or purported to be created pursuant to any
2404	financing documents to secure any bonds or other indebtedness of
2405	the corporation shall be and remain valid and enforceable,
2406	notwithstanding the commencement of and during the continuation
2407	of, and after, any rehabilitation, insolvency, liquidation,
2408	bankruptcy, receivership, conservatorship, reorganization, or
2409	similar proceeding against the corporation under the laws of
2410	this state.
2411	2.  No such proceeding shall relieve the corporation of its
2412	obligation, or otherwise affect its ability to perform its
2413	obligation, to continue to collect, or levy and collect,
2414	assessments, market equalization or other surcharges under
2415	subparagraph (c)10., or any other rights, revenues, or other
2416	assets of the corporation pledged pursuant to any financing
2417	documents.
2418	3.  Each such pledge or sale of, lien upon, and security
2419	interest in, including the priority of such pledge, lien, or
2420	security interest, any such assessments, market equalization or
2421	other surcharges, or other rights, revenues, or other assets
2422	which are collected, or levied and collected, after the
2423	commencement of and during the pendency of, or after, any such
2424	proceeding shall continue unaffected by such proceeding. As used
2425	in this subsection, the term "financing documents" means any
2426	agreement or agreements, instrument or instruments, or other
2427	document or documents now existing or hereafter created
2428	evidencing any bonds or other indebtedness of the corporation or
2429	pursuant to which any such bonds or other indebtedness has been
2430	or may be issued and pursuant to which any rights, revenues, or
2431	other assets of the corporation are pledged or sold to secure
2432	the repayment of such bonds or indebtedness, together with the
2433	payment of interest on such bonds or such indebtedness, or the
2434	payment of any other obligation or financial product, as defined
2435	in the plan of operation of the corporation related to such
2436	bonds or indebtedness.
2437	4.  Any such pledge or sale of assessments, revenues,
2438	contract rights, or other rights or assets of the corporation
2439	shall constitute a lien and security interest, or sale, as the
2440	case may be, that is immediately effective and attaches to such
2441	assessments, revenues, or contract rights or other rights or
2442	assets, whether or not imposed or collected at the time the
2443	pledge or sale is made. Any such pledge or sale is effective,
2444	valid, binding, and enforceable against the corporation or other
2445	entity making such pledge or sale, and valid and binding against
2446	and superior to any competing claims or obligations owed to any
2447	other person or entity, including policyholders in this state,
2448	asserting rights in any such assessments, revenues, or contract
2449	rights or other rights or assets to the extent set forth in and
2450	in accordance with the terms of the pledge or sale contained in
2451	the applicable financing documents, whether or not any such
2452	person or entity has notice of such pledge or sale and without
2453	the need for any physical delivery, recordation, filing, or
2454	other action.
2455	(n)1.  The following records of the corporation are
2456	confidential and exempt from the provisions of s. 119.07(1) and
2457	s. 24(a), Art. I of the State Constitution:
2458	a.  Underwriting files, except that a policyholder or an
2459	applicant shall have access to his or her own underwriting
2460	files.
2461	b.  Claims files, until termination of all litigation and
2462	settlement of all claims arising out of the same incident,
2463	although portions of the claims files may remain exempt, as
2464	otherwise provided by law. Confidential and exempt claims file
2465	records may be released to other governmental agencies upon
2466	written request and demonstration of need; such records held by
2467	the receiving agency remain confidential and exempt as provided
2468	for herein.
2469	c.  Records obtained or generated by an internal auditor
2470	pursuant to a routine audit, until the audit is completed, or if
2471	the audit is conducted as part of an investigation, until the
2472	investigation is closed or ceases to be active. An investigation
2473	is considered "active" while the investigation is being
2474	conducted with a reasonable, good faith belief that it could
2475	lead to the filing of administrative, civil, or criminal
2476	proceedings.
2477	d.  Matters reasonably encompassed in privileged attorney-
2478	client communications.
2479	e.  Proprietary information licensed to the corporation
2480	under contract and the contract provides for the confidentiality
2481	of such proprietary information.
2482	f.  All information relating to the medical condition or
2483	medical status of a corporation employee which is not relevant
2484	to the employee's capacity to perform his or her duties, except
2485	as otherwise provided in this paragraph. Information which is
2486	exempt shall include, but is not limited to, information
2487	relating to workers' compensation, insurance benefits, and
2488	retirement or disability benefits.
2489	g.  Upon an employee's entrance into the employee
2490	assistance program, a program to assist any employee who has a
2491	behavioral or medical disorder, substance abuse problem, or
2492	emotional difficulty which affects the employee's job
2493	performance, all records relative to that participation shall be
2494	confidential and exempt from the provisions of s. 119.07(1) and
2495	s. 24(a), Art. I of the State Constitution, except as otherwise
2496	provided in s. 112.0455(11).
2497	h.  Information relating to negotiations for financing,
2498	reinsurance, depopulation, or contractual services, until the
2499	conclusion of the negotiations.
2500	i.  Minutes of closed meetings regarding underwriting
2501	files, and minutes of closed meetings regarding an open claims
2502	file until termination of all litigation and settlement of all
2503	claims with regard to that claim, except that information
2504	otherwise confidential or exempt by law will be redacted.
2505
2506	When an authorized insurer is considering underwriting a risk
2507	insured by the corporation, relevant underwriting files and
2508	confidential claims files may be released to the insurer
2509	provided the insurer agrees in writing, notarized and under
2510	oath, to maintain the confidentiality of such files. When a file
2511	is transferred to an insurer that file is no longer a public
2512	record because it is not held by an agency subject to the
2513	provisions of the public records law. Underwriting files and
2514	confidential claims files may also be released to staff of and
2515	the board of governors of the market assistance plan established
2516	pursuant to s. 627.3515, who must retain the confidentiality of
2517	such files, except such files may be released to authorized
2518	insurers that are considering assuming the risks to which the
2519	files apply, provided the insurer agrees in writing, notarized
2520	and under oath, to maintain the confidentiality of such files.
2521	Finally, the corporation or the board or staff of the market
2522	assistance plan may make the following information obtained from
2523	underwriting files and confidential claims files available to
2524	licensed general lines insurance agents: name, address, and
2525	telephone number of the residential property owner or insured;
2526	location of the risk; rating information; loss history; and
2527	policy type. The receiving licensed general lines insurance
2528	agent must retain the confidentiality of the information
2529	received.
2530	2.  Portions of meetings of the corporation are exempt from
2531	the provisions of s. 286.011 and s. 24(b), Art. I of the State
2532	Constitution wherein confidential underwriting files or
2533	confidential open claims files are discussed. All portions of
2534	corporation meetings which are closed to the public shall be
2535	recorded by a court reporter. The court reporter shall record
2536	the times of commencement and termination of the meeting, all
2537	discussion and proceedings, the names of all persons present at
2538	any time, and the names of all persons speaking. No portion of
2539	any closed meeting shall be off the record. Subject to the
2540	provisions hereof and s. 119.07(1)(b)-(d), the court reporter's
2541	notes of any closed meeting shall be retained by the corporation
2542	for a minimum of 5 years. A copy of the transcript, less any
2543	exempt matters, of any closed meeting wherein claims are
2544	discussed shall become public as to individual claims after
2545	settlement of the claim.
2546	(o)  It is the intent of the Legislature that the
2547	amendments to this subsection enacted in 2002 should, over time,
2548	reduce the probable maximum windstorm losses in the residual
2549	markets and should reduce the potential assessments to be levied
2550	on property insurers and policyholders statewide. In furtherance
2551	of this intent:
2552	1.  The board shall, on or before February 1 of each year,
2553	provide a report to the President of the Senate and the Speaker
2554	of the House of Representatives showing the reduction or
2555	increase in the 100-year probable maximum loss attributable to
2556	wind-only coverages and the quota share program under this
2557	subsection combined, as compared to the benchmark 100-year
2558	probable maximum loss of the Florida Windstorm Underwriting
2559	Association. For purposes of this paragraph, the benchmark 100-
2560	year probable maximum loss of the Florida Windstorm Underwriting
2561	Association shall be the calculation dated February 2001 and
2562	based on November 30, 2000, exposures. In order to ensure
2563	comparability of data, the board shall use the same methods for
2564	calculating its probable maximum loss as were used to calculate
2565	the benchmark probable maximum loss. The reduction or increase
2566	in probable maximum loss shall be calculated without taking into
2567	account the probable maximum loss attributable to the
2568	nonhomestead account.
2569	2.  Beginning February 1, 2013 2007, if the report under
2570	subparagraph 1. for any year indicates that the 100-year
2571	probable maximum loss attributable to wind-only coverages and
2572	the quota share program combined does not reflect a reduction of
2573	at least 25 percent from the benchmark, the board shall reduce
2574	the boundaries of the high-risk area eligible for wind-only
2575	coverages under this subsection in a manner calculated to reduce
2576	such probable maximum loss to an amount at least 25 percent
2577	below the benchmark.
2578	3.  Beginning February 1, 2018 2012, if the report under
2579	subparagraph 1. for any year indicates that the 100-year
2580	probable maximum loss attributable to wind-only coverages and
2581	the quota share program combined does not reflect a reduction of
2582	at least 50 percent from the benchmark, the boundaries of the
2583	high-risk area eligible for wind-only coverages under this
2584	subsection shall be reduced by the elimination of any area that
2585	is not seaward of a line 1,000 feet inland from the Intracoastal
2586	Waterway.
2587	(p)  In enacting the provisions of this section, the
2588	Legislature recognizes that both the Florida Windstorm
2589	Underwriting Association and the Residential Property and
2590	Casualty Joint Underwriting Association have entered into
2591	financing arrangements that obligate each entity to service its
2592	debts and maintain the capacity to repay funds secured under
2593	these financing arrangements. It is the intent of the
2594	Legislature that nothing in this section be construed to
2595	compromise, diminish, or interfere with the rights of creditors
2596	under such financing arrangements. It is further the intent of
2597	the Legislature to preserve the obligations of the Florida
2598	Windstorm Underwriting Association and Residential Property and
2599	Casualty Joint Underwriting Association with regard to
2600	outstanding financing arrangements, with such obligations
2601	passing entirely and unchanged to the corporation and,
2602	specifically, to the applicable account of the corporation. So
2603	long as any bonds, notes, indebtedness, or other financing
2604	obligations of the Florida Windstorm Underwriting Association or
2605	the Residential Property and Casualty Joint Underwriting
2606	Association are outstanding, under the terms of the financing
2607	documents pertaining to them, the governing board of the
2608	corporation shall have and shall exercise the authority to levy,
2609	charge, collect, and receive all premiums, assessments,
2610	surcharges, charges, revenues, and receipts that the
2611	associations had authority to levy, charge, collect, or receive
2612	under the provisions of subsection (2) and this subsection,
2613	respectively, as they existed on January 1, 2002, to provide
2614	moneys, without exercise of the authority provided by this
2615	subsection, in at least the amounts, and by the times, as would
2616	be provided under those former provisions of subsection (2) or
2617	this subsection, respectively, so that the value, amount, and
2618	collectability of any assets, revenues, or revenue source
2619	pledged or committed to, or any lien thereon securing such
2620	outstanding bonds, notes, indebtedness, or other financing
2621	obligations will not be diminished, impaired, or adversely
2622	affected by the amendments made by this act and to permit
2623	compliance with all provisions of financing documents pertaining
2624	to such bonds, notes, indebtedness, or other financing
2625	obligations, or the security or credit enhancement for them, and
2626	any reference in this subsection to bonds, notes, indebtedness,
2627	financing obligations, or similar obligations, of the
2628	corporation shall include like instruments or contracts of the
2629	Florida Windstorm Underwriting Association and the Residential
2630	Property and Casualty Joint Underwriting Association to the
2631	extent not inconsistent with the provisions of the financing
2632	documents pertaining to them.
2633	(q)  The corporation shall not require the securing of
2634	flood insurance as a condition of coverage if the insured or
2635	applicant executes a form approved by the office affirming that
2636	flood insurance is not provided by the corporation and that if
2637	flood insurance is not secured by the applicant or insured in
2638	addition to coverage by the corporation, the risk will not be
2639	covered for flood damage. A corporation policyholder electing
2640	not to secure flood insurance and executing a form as provided
2641	herein making a claim for water damage against the corporation
2642	shall have the burden of proving the damage was not caused by
2643	flooding. Notwithstanding other provisions of this subsection,
2644	the corporation may deny coverage to an applicant or insured who
2645	refuses to execute the form described herein.
2646	(r)  A salaried employee of the corporation who performs
2647	policy administration services subsequent to the effectuation of
2648	a corporation policy is not required to be licensed as an agent
2649	under the provisions of s. 626.112.
2650	(s)  The transition to homestead and nonhomestead accounts
2651	shall begin on October 1, 2006. A policy issued on or after that
2652	date shall be issued in the applicable homestead account or the
2653	nonhomestead account, based upon whether the property
2654	constitutes homestead property as provided in subparagraph (b)2.
2655	A policy in effect on October 1, 2006, shall be placed in the
2656	applicable homestead account or the nonhomestead account, based
2657	upon whether the property constitutes homestead property as
2658	provided in subparagraph (b)2., upon the first renewal of such
2659	policy after October 1, 2006.
2660	(t)  Any employee of the corporation whose position is
2661	managerial, policymaking, or professional in nature and all
2662	members of the corporation's board of governors shall comply
2663	with the Code of Ethics for public officers and employers found
2664	in ss. 112.311-112.326.
2665	(u)  An employee of the corporation shall notify the
2666	Division of Insurance Fraud within 48 hours after having
2667	information that would lead a reasonable person to suspect that
2668	fraud may have been committed by any employee of the
2669	corporation.
2670	(v)  By February 1, 2007, the corporation shall submit a
2671	report to the President of the Senate, the Speaker of the House
2672	of Representatives, the minority party leaders of the Senate and
2673	the House of Representatives, and the chairs of the standing
2674	committees of the Senate and the House of Representatives having
2675	jurisdiction over matters relating to property and casualty
2676	insurance. In preparing the report, the corporation shall
2677	consult with the Office of Insurance Regulation, the Department
2678	of Financial Services, and any other party the corporation
2679	determines is appropriate. The report shall include findings and
2680	recommendations on the feasibility of requiring authorized
2681	insurers that issue and service personal and commercial
2682	residential policies and commercial nonresidential policies that
2683	provide coverage for basic property perils except for the peril
2684	of wind to issue and service for a fee personal and commercial
2685	residential policies and commercial nonresidential policies
2686	providing coverage for the peril of wind issued by the
2687	corporation. The report shall include:
2688	1.  The expense savings to the corporation of issuing and
2689	servicing such policies as determined through a cost benefit
2690	analysis.
2691	2.  The expenses and liability to authorized insurers
2692	associated with issuing and servicing such policies.
2693	3.  The impact on service to policyholders of the
2694	corporation relating to issuing and servicing such policies.
2695	4.  The impact on the producing agent of the corporation of
2696	issuing and servicing such policies.
2697	5.  Recommendations as to the amount of the fee that should
2698	be paid to authorized insurers for issuing and servicing such
2699	policies.
2700	6.  The impact issuing and servicing such policies will
2701	have on the corporation's number of policies, total insured
2702	value, and probable maximum loss.
2703	(w)  There shall be no liability on the part of, and no
2704	cause of action of any nature shall arise against, producing
2705	agents of record or their employees for any action taken by them
2706	in the performance of their duties or responsibilities relating
2707	to the removal of policies from the corporation. Such immunity
2708	only applies to actions that may arise due to differences in
2709	coverage or procedures between any take-out insurer and the
2710	corporation or for insolvency of any take-out insurer.
2711	(x)  The Legislature finds that the total area eligible for
2712	the high-risk account of the corporation has a material impact
2713	on the availability of wind coverage from the voluntary admitted
2714	market, deficits of the corporation, assessments to be levied on
2715	property insurers and policyholders statewide, the ability and
2716	willingness of authorized insurers to write wind coverage in the
2717	high-risk areas, the probable maximum windstorm losses of the
2718	corporation, general commerce in coastal areas, and the overall
2719	financial condition of the state. Therefore, in furtherance of
2720	these findings and intent:
2721	1.  The High Risk Eligibility Panel is created.
2722	2.  The members of the panel shall be appointed as follows:
2723	a.  The board shall appoint two board members.
2724	b.  The Governor shall appoint one member.
2725	c.  The Chief Financial Officer shall appoint one member.
2726	d.  The Commissioner of Insurance Regulation shall appoint
2727	a representative of the office to serve as a member.
2728	e.  The President of the Senate shall appoint one member.
2729	f.  The Speaker of the House of Representatives shall
2730	appoint one member.
2731
2732	Members of the panel must be residents of this state with
2733	insurance expertise. Members shall elect a chair and shall serve
2734	3-year terms each. The panel shall operate independently of any
2735	state agency and shall be administered by the corporation. The
2736	panel shall make an annual report to the President of the Senate
2737	and the Speaker of the House of Representatives on or before
2738	February 1 of each year recommending the areas that should be
2739	eligible for the high-risk account of the corporation. Members
2740	shall not receive compensation and are not entitled to receive
2741	reimbursement for per diem and travel expenses as provided in s.
2742	112.061, except for any panel member who is a state employee.
2743	3.  The Legislature's intent provided in subparagraphs
2744	(a)1. and 2. shall provide guidance for the panel to use in the
2745	panel's recommendations to the Legislature required in
2746	subparagraph 1. The panel shall consider the following factors
2747	in fulfilling its responsibilities under this paragraph:
2748	a.  The number of commercial risks in a given area that are
2749	unable to find wind coverage from the voluntary admitted market.
2750	b.  Reports from members of the mortgage industry
2751	indicating difficulty in finding forced placed policies for
2752	commercial wind coverage.
2753	c.  The number of approved excess and surplus lines
2754	carriers certifying an unwillingness to provide commercial wind
2755	coverage similar to that approved for use by the office for the
2756	voluntary admitted market.
2757	d.  Other relevant factors.
2758
2759	The office and the corporation shall provide the panel with any
2760	information the panel considers necessary to determine areas
2761	eligible for the high-risk account of the corporation. For the
2762	purpose of making accurate determinations for areas eligible for
2763	the high-risk account of the corporation, the panel may
2764	interview and request and receive information from residents of
2765	this state in areas impacted by this paragraph, including, but
2766	not limited to, insurance agents, insurance companies,
2767	actuaries, and other insurance professionals. Upon request of
2768	the panel, the office may conduct public hearings in areas that
2769	may be impacted by the panel's recommendations.
2770	4.  Notwithstanding other provisions of this paragraph, the
2771	panel shall conduct an analysis to determine the areas to be
2772	eligible for the high-risk account of the corporation for any
2773	county that contains an eligible area extending more than 2
2774	miles from the coast, any coastal county that does not have
2775	areas designated as eligible for the high-risk account, and
2776	counties with barrier islands whether or not such islands or
2777	portions of such islands are currently eligible for the high
2778	risk account. The panel shall submit a report, including its
2779	analysis, to the office and to the corporation by November 30,
2780	2006. The report shall specify changes to the areas eligible for
2781	the high-risk account for such affected counties based on its
2782	analysis.
2783	Section 10.  Paragraph (b) of subsection (3) of section
2784	627.4035, Florida Statutes, is amended, and subsection (4) is
2785	added to that section, to read:
2786	627.4035  Cash payment of premiums; claims.--
2787	(3)  All payments of claims made in this state under any
2788	contract of insurance shall be paid:
2789	(b)  If authorized in writing by the recipient or the
2790	recipient's representative, by debit card or any other form of
2791	electronic transfer. Any fees or costs to be charged against the
2792	recipient must be disclosed in writing to the recipient or the
2793	recipient's representative at the time of written authorization.
2794	However, the written authorization requirement may be waived by
2795	the recipient or the recipient's representative if the insurer
2796	verifies the identity of the insured or the insured's recipient
2797	and does not charge a fee for the transaction. If the funds are
2798	misdirected, the insurer would remain liable for the payment of
2799	the claim.
2800	(4)  Nothing in this section shall be construed as
2801	prohibiting an insurer from limiting its liability under a
2802	policy or endorsement providing that loss will be adjusted on
2803	the basis of replacement costs to the lesser of:
2804	(a)  The limit of liability shown on the policy
2805	declarations page;
2806	(b)  The reasonable and necessary cost to repair the
2807	damaged, destroyed, or stolen covered property; or
2808	(c)  The reasonable and necessary cost to replace the
2809	damaged, destroyed, or stolen covered property.
2810	Section 11.  Subsections (2) and (3) of section 627.7011,
2811	Florida Statutes, are amended, and subsection (6) is added to
2812	that section, to read:
2813	627.7011  Homeowners' policies; offer of replacement cost
2814	coverage and law and ordinance coverage.--
2815	(2)  Unless the insurer obtains the policyholder's written
2816	refusal of the policies or endorsements specified in subsection
2817	(1), any policy covering the dwelling is deemed to include the
2818	law and ordinance coverage limited to 25 percent of the dwelling
2819	limit specified in paragraph (1)(b). The rejection or selection
2820	of alternative coverage shall be made on a form approved by the
2821	office. The form shall fully advise the applicant of the nature
2822	of the coverage being rejected. If this form is signed by a
2823	named insured, it will be conclusively presumed that there was
2824	an informed, knowing rejection of the coverage or election of
2825	the alternative coverage on behalf of all insureds. Unless the
2826	policyholder requests in writing the coverage specified in this
2827	section, it need not be provided in or supplemental to any other
2828	policy that renews, insures, extends, changes, supersedes, or
2829	replaces an existing policy when the policyholder has rejected
2830	the coverage specified in this section or has selected
2831	alternative coverage. The insurer must provide such policyholder
2832	with notice of the availability of such coverage in a form
2833	approved by the office at least once every 3 years. The failure
2834	to provide such notice constitutes a violation of this code, but
2835	does not affect the coverage provided under the policy.
2836	(3)  In the event of a loss for which a dwelling or
2837	personal property is insured on the basis of replacement costs,
2838	the insurer shall pay the replacement cost without reservation
2839	or holdback of any depreciation in value, whether or not the
2840	insured replaces or repairs the dwelling or property.
2841	(6)  Insurers shall issue separate checks for living
2842	expenses, contents, and casualty proceeds. Checks for living
2843	expenses and contents should be issued directly to the
2844	policyholder.
2845	Section 12.  Effective upon this act becoming a law,
2846	section 627.7019, Florida Statutes, is created to read:
2847	627.7019  Standardization of requirements applicable to
2848	insurers after natural disasters.--
2849	(1)  The commission shall adopt by rule, pursuant to s.
2850	120.54(1)-(3), standardized requirements that may be applied to
2851	insurers as a consequence of a hurricane or other natural
2852	disaster. The rules shall address the following areas:
2853	(a)  Claims reporting requirements.
2854	(b)  Grace periods for payment of premiums and performance
2855	of other duties by insureds.
2856	(c)  Temporary postponement of cancellations and
2857	nonrenewals.
2858	(2)  The rules adopted pursuant to this section shall
2859	require the office to issue an order within 72 hours after the
2860	occurrence of a hurricane or other natural disaster specifying,
2861	by line of insurance, which of the standardized requirements
2862	apply, the geographic areas in which they apply, the time at
2863	which applicability commences, and the time at which
2864	applicability terminates.
2865	(3)  The commission and the office may not adopt an
2866	emergency rule under s. 120.54(4) in conflict with any provision
2867	of the rules adopted under this section.
2868	(4)  The commission shall initiate rulemaking under this
2869	section no later than June 1, 2006.
2870	Section 13.  Subsection (5) of section 627.727, Florida
2871	Statutes, is amended to read:
2872	627.727  Motor vehicle insurance; uninsured and
2873	underinsured vehicle coverage; insolvent insurer protection.--
2874	(5)  Any person having a claim against an insolvent insurer
2875	as defined in s. 631.54(6)(5) under the provisions of this
2876	section shall present such claim for payment to the Florida
2877	Insurance Guaranty Association only. In the event of a payment
2878	to any person in settlement of a claim arising under the
2879	provisions of this section, the association is not subrogated or
2880	entitled to any recovery against the claimant's insurer. The
2881	association, however, has the rights of recovery as set forth in
2882	chapter 631 in the proceeds recoverable from the assets of the
2883	insolvent insurer.
2884	Section 14.  Paragraph (f) is added to subsection (2) of
2885	section 631.181, Florida Statutes, to read:
2886	631.181  Filing and proof of claim.--
2887	(2)
2888	(f)  The signed statement required by this section shall
2889	not be required on claims for which adequate claims file
2890	documentation exists within the records of the insolvent
2891	insurer. Claims for payment of unearned premium shall not be
2892	required to use the signed statement required by this section if
2893	the receiver certifies to the guaranty fund that the records of
2894	the insolvent insurer are sufficient to determine the amount of
2895	unearned premium owed to each policyholder of the insurer and
2896	such information is remitted to the guaranty fund by the
2897	receiver in electronic or other mutually agreed-upon format.
2898	Section 15.  Subsections (5), (6), (7), and (8) of section
2899	631.54, Florida Statutes, are renumbered as subsections (6),
2900	(7), (8), and (9), respectively, and a new subsection (5) is
2901	added to that section, to read:
2902	631.54  Definitions.--As used in this part:
2903	(5)  "Homeowner's insurance" means personal lines
2904	residential property insurance coverage that consists of the
2905	type of coverage provided under homeowner's, dwelling, and
2906	similar policies for repair or replacement of the insured
2907	structure and contents, which policies are written directly to
2908	the individual homeowner. Residential coverage for personal
2909	lines as set forth in this section includes policies that
2910	provide coverage for particular perils such as windstorm and
2911	hurricane coverage but excludes all coverage for mobile homes,
2912	renter's insurance, or tenant's coverage. The term "homeowner's
2913	insurance" excludes commercial residential policies covering
2914	condominium associations or homeowners' associations, which
2915	associations have a responsibility to provide insurance coverage
2916	on residential units within the association, and also excludes
2917	coverage for the common elements of a homeowners' association.
2918	Section 16.  Subsection (1) of section 631.55, Florida
2919	Statutes, is amended to read:
2920	631.55  Creation of the association.--
2921	(1)  There is created a nonprofit corporation to be known
2922	as the "Florida Insurance Guaranty Association, Incorporated."
2923	All insurers defined as member insurers in s. 631.54(7)(6) shall
2924	be members of the association as a condition of their authority
2925	to transact insurance in this state, and, further, as a
2926	condition of such authority, an insurer shall agree to reimburse
2927	the association for all claim payments the association makes on
2928	said insurer's behalf if such insurer is subsequently
2929	rehabilitated. The association shall perform its functions under
2930	a plan of operation established and approved under s. 631.58 and
2931	shall exercise its powers through a board of directors
2932	established under s. 631.56. The corporation shall have all
2933	those powers granted or permitted nonprofit corporations, as
2934	provided in chapter 617.
2935	Section 17.  Paragraph (a) of subsection (1), paragraph (d)
2936	of subsection (2), and paragraph (a) of subsection (3) of
2937	section 631.57, Florida Statutes, are amended, and paragraph (e)
2938	is added to subsection (3) of that section, to read:
2939	631.57  Powers and duties of the association.--
2940	(1)  The association shall:
2941	(a)1.  Be obligated to the extent of the covered claims
2942	existing:
2943	a.  Prior to adjudication of insolvency and arising within
2944	30 days after the determination of insolvency;
2945	b.  Before the policy expiration date if less than 30 days
2946	after the determination; or
2947	c.  Before the insured replaces the policy or causes its
2948	cancellation, if she or he does so within 30 days of the
2949	determination.
2950	2.  The obligation under subparagraph 1. shall include only
2951	the amount of each covered claim that is in excess of $100 and
2952	is less than $300,000, except policies providing coverage for
2953	homeowner's insurance shall provide for an additional $200,000
2954	for the portion of a covered claim that relates only to the
2955	damage to the structure and contents.
2956	3.a.2.  Notwithstanding subparagraph 2., the obligation
2957	under subparagraph 1. for shall include only that amount of each
2958	covered claim which is in excess of $100 and is less than
2959	$300,000, except with respect to policies covering condominium
2960	associations or homeowners' associations, which associations
2961	have a responsibility to provide insurance coverage on
2962	residential units within the association, the obligation shall
2963	include that amount of each covered property insurance claim
2964	which is less than $100,000 multiplied by the number of
2965	condominium units or other residential units; however, as to
2966	homeowners' associations, this sub-subparagraph subparagraph
2967	applies only to claims for damage or loss to residential units
2968	and structures attached to residential units.
2969	b.  Notwithstanding sub-subparagraph a., the association
2970	has no obligation to pay covered claims that are to be paid from
2971	the proceeds of bonds issued under s. 631.695. However, the
2972	association shall assign and pledge the first available moneys
2973	from all or part of the assessments to be made under paragraph
2974	(3)(a) to or on behalf of the issuer of such bonds for the
2975	benefit of the holders of such bonds. The association shall
2976	administer any such covered claims and present valid covered
2977	claims for payment in accordance with the provisions of the
2978	assistance program in connection with which such bonds have been
2979	issued.
2980	3.  In no event shall the association be obligated to a
2981	policyholder or claimant in an amount in excess of the
2982	obligation of the insolvent insurer under the policy from which
2983	the claim arises.
2984	(2)  The association may:
2985	(d)  Negotiate and become a party to such contracts as are
2986	necessary to carry out the purpose of this part. Additionally,
2987	the association may enter into such contracts with a
2988	municipality, a county, or a legal entity created pursuant to s.
2989	163.01(7)(g) as are necessary in order for the municipality,
2990	county, or legal entity to issue bonds under s. 631.695. In
2991	connection with the issuance of any such bonds and the entering
2992	into of any such necessary contracts, the association may agree
2993	to such terms and conditions as the association deems necessary
2994	and proper.
2995	(3)(a)  To the extent necessary to secure the funds for the
2996	respective accounts for the payment of covered claims, and also
2997	to pay the reasonable costs to administer the same, and to the
2998	extent necessary to secure the funds for the account specified
2999	in s. 631.55(2)(c) or to retire indebtedness, including, without
3000	limitation, the principal, redemption premium, if any, and
3001	interest on, and related costs of issuance of, bonds issued
3002	under s. 631.695 and the funding of any reserves and other
3003	payments required under the bond resolution or trust indenture
3004	pursuant to which such bonds have been issued, the office, upon
3005	certification of the board of directors, shall levy assessments
3006	in the proportion that each insurer's net direct written
3007	premiums in this state in the classes protected by the account
3008	bears to the total of said net direct written premiums received
3009	in this state by all such insurers for the preceding calendar
3010	year for the kinds of insurance included within such account.
3011	Assessments shall be remitted to and administered by the board
3012	of directors in the manner specified by the approved plan. Each
3013	insurer so assessed shall have at least 30 days' written notice
3014	as to the date the assessment is due and payable. Every
3015	assessment shall be made as a uniform percentage applicable to
3016	the net direct written premiums of each insurer in the kinds of
3017	insurance included within the account in which the assessment is
3018	made. The assessments levied against any insurer shall not
3019	exceed in any one year more than 2 percent of that insurer's net
3020	direct written premiums in this state for the kinds of insurance
3021	included within such account during the calendar year next
3022	preceding the date of such assessments.
3023	(e)1.a.  In addition to assessments otherwise authorized in
3024	paragraph (a) and to the extent necessary to secure the funds
3025	for the account specified in s. 631.55(2)(c) or to retire
3026	indebtedness, including, without limitation, the principal,
3027	redemption premium, if any, and interest on, and related costs
3028	of issuance of, bonds issued under s. 631.695 and the funding of
3029	any reserves and other payments required under the bond
3030	resolution or trust indenture pursuant to which such bonds have
3031	been issued, the office, upon certification of the board of
3032	directors, shall levy emergency assessments upon insurers
3033	holding a certificate of authority. The emergency assessments
3034	payable under this paragraph by any insurer shall not exceed in
3035	any single year more than 2 percent of that insurer's direct
3036	written premiums, net of refunds, in this state during the
3037	preceding calendar year for the kinds of insurance within the
3038	account specified in s. 631.55(2)(c).
3039	b.  Any emergency assessments authorized under this
3040	paragraph shall be levied by the office upon insurers referred
3041	to in sub-subparagraph a., upon certification as to the need for
3042	such assessments by the board of directors, in each year that
3043	bonds issued under s. 631.695 and secured by such emergency
3044	assessments are outstanding, in such amounts up to such 2-
3045	percent limit as required in order to provide for the full and
3046	timely payment of the principal of, redemption premium, if any,
3047	and interest on, and related costs of issuance of, such bonds.
3048	The emergency assessments provided for in this paragraph are
3049	assigned and pledged to the municipality, county, or legal
3050	entity issuing bonds under s. 631.695 for the benefit of the
3051	holders of such bonds, in order to enable such municipality,
3052	county, or legal entity to provide for the payment of the
3053	principal of, redemption premium, if any, and interest on such
3054	bonds, the cost of issuance of such bonds, and the funding of
3055	any reserves and other payments required under the bond
3056	resolution or trust indenture pursuant to which such bonds have
3057	been issued, without the necessity of any further action by the
3058	association, the office, or any other party. To the extent bonds
3059	are issued under s. 631.695 and the association determines to
3060	secure such bonds by a pledge of revenues received from the
3061	emergency assessments, such bonds, upon such pledge of revenues,
3062	shall be secured by and payable from the proceeds of such
3063	emergency assessments, and the proceeds of emergency assessments
3064	levied under this paragraph shall be remitted directly to and
3065	administered by the trustee or custodian appointed for such
3066	bonds.
3067	c.  Emergency assessments under this paragraph may be
3068	payable in a single payment or, at the option of the
3069	association, may be payable in 12 monthly installments with the
3070	first installment being due and payable at the end of the month
3071	after an emergency assessment is levied and subsequent
3072	installments being due not later than the end of each succeeding
3073	month.
3074	d.  If emergency assessments are imposed, the report
3075	required by s. 631.695(7) shall include an analysis of the
3076	revenues generated from the emergency assessments imposed under
3077	this paragraph.
3078	e.  If emergency assessments are imposed, the references in
3079	sub-subparagraph (1)(a)3.b. and s. 631.695(2) and (7) to
3080	assessments levied under paragraph (a) shall include emergency
3081	assessments imposed under this paragraph.
3082	2.  In order to ensure that insurers paying emergency
3083	assessments levied under this paragraph continue to charge rates
3084	that are neither inadequate nor excessive, within 90 days after
3085	being notified of such assessments, each insurer that is to be
3086	assessed pursuant to this paragraph shall submit a rate filing
3087	for coverage included within the account specified in s.
3088	631.55(2)(c) and for which rates are required to be filed under
3089	s. 627.062. If the filing reflects a rate change that, as a
3090	percentage, is equal to the difference between the rate of such
3091	assessment and the rate of the previous year's assessment under
3092	this paragraph, the filing shall consist of a certification so
3093	stating and shall be deemed approved when made. Any rate change
3094	of a different percentage shall be subject to the standards and
3095	procedures of s. 627.062.
3096	3.  An annual assessment under this paragraph shall
3097	continue while the bonds issued with respect to which the
3098	assessment was imposed are outstanding, including any bonds the
3099	proceeds of which were used to refund bonds issued pursuant to
3100	s. 631.695, unless adequate provision has been made for the
3101	payment of the bonds in the documents authorizing the issuance
3102	of such bonds.
3103	4.  Emergency assessments under this paragraph are not
3104	premium and are not subject to the premium tax, to any fees, or
3105	to any commissions. An insurer is liable for all emergency
3106	assessments that the insurer collects and shall treat the
3107	failure of an insured to pay an emergency assessment as a
3108	failure to pay the premium. An insurer is not liable for
3109	uncollectible emergency assessments.
3110	Section 18.  Section 631.695, Florida Statutes, is created
3111	to read:
3112	631.695  Revenue bond issuance through counties or
3113	municipalities.--
3114	(1)  The Legislature finds:
3115	(a)  The potential for widespread and massive damage to
3116	persons and property caused by hurricanes making landfall in
3117	this state can generate insurance claims of such a number as to
3118	render numerous insurers operating within this state insolvent
3119	and therefore unable to satisfy covered claims.
3120	(b)  The inability of insureds within this state to receive
3121	payment of covered claims or to timely receive such payment
3122	creates financial and other hardships for such insureds and
3123	places undue burdens on the state, the affected units of local
3124	government, and the community at large.
3125	(c)  In addition, the failure of insurers to pay covered
3126	claims or to timely pay such claims due to the insolvency of
3127	such insurers can undermine the public's confidence in insurers
3128	operating within this state, thereby adversely affecting the
3129	stability of the insurance industry in this state.
3130	(d)  The state has previously taken action to address these
3131	problems by adopting the Florida Insurance Guaranty Association
3132	Act, which, among other things, provides a mechanism for the
3133	payment of covered claims under certain insurance policies to
3134	avoid excessive delay in payment and to avoid financial loss to
3135	claimants or policyholders because of the insolvency of an
3136	insurer.
3137	(e)  In the wake of the unprecedented destruction caused by
3138	various hurricanes that have made landfall in this state, the
3139	resultant covered claims, and the number of insurers rendered
3140	insolvent thereby, make it evident that alternative programs
3141	must be developed to allow the Florida Insurance Guaranty
3142	Association to more expeditiously and effectively provide for
3143	the payment of covered claims.
3144	(f)  It is therefore determined to be in the best interests
3145	of, and necessary for, the protection of the public health,
3146	safety, and general welfare of the residents of this state and
3147	for the protection and preservation of the economic stability of
3148	insurers operating in this state and it is declared to be an
3149	essential public purpose to permit certain municipalities and
3150	counties to take such actions as will provide relief to
3151	claimants and policyholders having covered claims against
3152	insolvent insurers operating in this state by expediting the
3153	handling and payment of covered claims.
3154	(g)  To achieve the foregoing purposes, it is proper to
3155	authorize municipalities and counties of this state
3156	substantially affected by the landfall of a hurricane to issue
3157	bonds to assist the Florida Insurance Guaranty Association in
3158	expediting the handling and payment of covered claims of
3159	insolvent insurers.
3160	(h)  In order to avoid the needless and indiscriminate
3161	proliferation, duplication, and fragmentation of such assistance
3162	programs, it is in the best interests of the residents of this
3163	state to authorize municipalities and counties severely affected
3164	by a hurricane to provide for the payment of covered claims
3165	beyond their territorial limits in the implementation of such
3166	programs.
3167	(i)  It is a paramount public purpose for municipalities
3168	and counties substantially affected by the landfall of a
3169	hurricane to be able to issue bonds for the purposes described
3170	in this section. Such issuance shall provide assistance to
3171	residents of those municipalities and counties as well as to
3172	other residents of this state.
3173	(2)  The governing body of any municipality or county, the
3174	residents of which have been substantially affected by a
3175	hurricane, may issue bonds to fund an assistance program in
3176	conjunction with, and with the consent of, the Florida Insurance
3177	Guaranty Association for the purpose of paying claimants' or
3178	policyholders' covered claims, as defined in s. 631.54, arising
3179	through the insolvency of an insurer, which insolvency is
3180	determined by the Florida Insurance Guaranty Association to have
3181	been a result of a hurricane, regardless of whether the
3182	claimants or policyholders are residents of such municipality or
3183	county or the property to which the claim relates is located
3184	within or outside the territorial jurisdiction of the
3185	municipality or county. The power of a municipality or county to
3186	issue bonds, as described in this section, is in addition to any
3187	powers granted by law and may not be abrogated or restricted by
3188	any provisions in such municipality's or county's charter. A
3189	municipality or county issuing bonds for this purpose shall
3190	enter into such contracts with the Florida Insurance Guaranty
3191	Association or any entity acting on behalf of the Florida
3192	Insurance Guaranty Association as are necessary to implement the
3193	assistance program. Any bonds issued by a municipality or county
3194	or a combination thereof under this subsection shall be payable
3195	from and secured by moneys received by or on behalf of the
3196	municipality or county from assessments levied under s.
3197	631.57(3)(a) and assigned and pledged to or on behalf of the
3198	municipality or county for the benefit of the holders of the
3199	bonds in connection with the assistance program. The funds,
3200	credit, property, and taxing power of the state or any
3201	municipality or county shall not be pledged for the payment of
3202	such bonds.
3203	(3)  Bonds may be validated by the municipality or county
3204	pursuant to chapter 75. The proceeds of the bonds may be used to
3205	pay covered claims of insolvent insurers; to refinance or
3206	replace previously existing borrowings or financial
3207	arrangements; to pay interest on bonds; to fund reserves for the
3208	bonds; to pay expenses incident to the issuance or sale of any
3209	bond issued under this section, including costs of validating,
3210	printing, and delivering the bonds, costs of printing the
3211	official statement, costs of publishing notices of sale of the
3212	bonds, costs of obtaining credit enhancement or liquidity
3213	support, and related administrative expenses; or for such other
3214	purposes related to the financial obligations of the fund as the
3215	association may determine. The term of the bonds may not exceed
3216	30 years.
3217	(4)  The state covenants with holders of bonds of the
3218	assistance program that the state will not take any action that
3219	will have a material adverse effect on the holders and will not
3220	repeal or abrogate the power of the board of directors of the
3221	association to direct the Office of Insurance Regulation to levy
3222	the assessments and to collect the proceeds of the revenues
3223	pledged to the payment of the bonds as long as any of the bonds
3224	remain outstanding, unless adequate provision has been made for
3225	the payment of the bonds in the documents authorizing the
3226	issuance of the bonds.
3227	(5)  The accomplishment of the authorized purposes of such
3228	municipality or county under this section is in all respects for
3229	the benefit of the people of the state, for the increase of
3230	their commerce and prosperity, and for the improvement of their
3231	health and living conditions. The municipality or county, in
3232	performing essential governmental functions in accomplishing its
3233	purposes, is not required to pay any taxes or assessments of any
3234	kind whatsoever upon any property acquired or used by the county
3235	or municipality for such purposes or upon any revenues at any
3236	time received by the county or municipality. The bonds, notes,
3237	and other obligations of the municipality or county and the
3238	transfer of and income from such bonds, notes, and other
3239	obligations, including any profits made on the sale of such
3240	bonds, notes, and other obligations, are exempt from taxation of
3241	any kind by the state or by any political subdivision or other
3242	agency or instrumentality of the state. The exemption granted in
3243	this subsection is not applicable to any tax imposed by chapter
3244	220 on interest, income, or profits on debt obligations owned by
3245	corporations.
3246	(6)  Two or more municipalities or counties, the residents
3247	of which have been substantially affected by a hurricane, may
3248	create a legal entity pursuant to s. 163.01(7)(g) to exercise
3249	the powers described in this section as well as those powers
3250	granted in s. 163.01(7)(g). References in this section to a
3251	municipality or county includes such legal entity.
3252	(7)  The association shall issue an annual report on the
3253	status of the use of bond proceeds as related to insolvencies
3254	caused by hurricanes. The report must contain the number and
3255	amount of claims paid. The association shall also include an
3256	analysis of the revenue generated from the assessment levied
3257	under s. 631.57(3)(a) to pay such bonds. The association shall
3258	submit a copy of the report to the President of the Senate, the
3259	Speaker of the House of Representatives, and the Chief Financial
3260	Officer within 90 days after the end of each calendar year in
3261	which bonds were outstanding.
3262	Section 19.  No provision of s. 631.57 or s. 631.695,
3263	Florida Statutes, shall be repealed until such time as the
3264	principal, redemption premium, if any, and interest on all bonds
3265	issued under s. 631.695, Florida Statutes, payable and secured
3266	from assessments levied under s. 631.57(3)(a), Florida Statutes,
3267	have been paid in full or adequate provision for such payment
3268	has been made in accordance with the bond resolution or trust
3269	indenture pursuant to which the bonds were issued.
3270	Section 20.  Paragraph (a) of subsection (1) of section
3271	817.234, Florida Statutes, is amended to read:
3272	817.234  False and fraudulent insurance claims.--
3273	(1)(a)  A person commits insurance fraud punishable as
3274	provided in subsection (11) if that person, with the intent to
3275	injure, defraud, or deceive any insurer:
3276	1.  Presents or causes to be presented any written or oral
3277	statement as part of, or in support of, a claim for payment or
3278	other benefit pursuant to an insurance policy or a health
3279	maintenance organization subscriber or provider contract,
3280	knowing that such statement contains any false, incomplete, or
3281	misleading information concerning any fact or thing material to
3282	such claim;
3283	2.  Prepares or makes any written or oral statement that is
3284	intended to be presented to any insurer in connection with, or
3285	in support of, any claim for payment or other benefit pursuant
3286	to an insurance policy or a health maintenance organization
3287	subscriber or provider contract, knowing that such statement
3288	contains any false, incomplete, or misleading information
3289	concerning any fact or thing material to such claim; or
3290	3.a.  Knowingly presents, causes to be presented, or
3291	prepares or makes with knowledge or belief that it will be
3292	presented to any insurer, purported insurer, servicing
3293	corporation, insurance broker, or insurance agent, or any
3294	employee or agent thereof, any false, incomplete, or misleading
3295	information or written or oral statement as part of, or in
3296	support of, an application for the issuance of, or the rating
3297	of, any insurance policy, or a health maintenance organization
3298	subscriber or provider contract, including any false declaration
3299	of homestead status for the purpose of obtaining coverage in a
3300	homestead account under s. 627.351(6); or
3301	b.  Who knowingly conceals information concerning any fact
3302	material to such application.
3303	Section 21.  Task Force on Hurricane Mitigation and
3304	Hurricane Insurance for Mobile and Manufactured Homes.--
3305	(1)  TASK FORCE CREATED.--There is created the Task Force
3306	on Hurricane Mitigation and Hurricane Insurance for Mobile and
3307	Manufactured Homes.
3308	(2)  ADMINISTRATION.--The task force shall be
3309	administratively housed within the Office of Insurance
3310	Regulation but shall operate independently of any state officer
3311	or agency. The office shall provide such administrative support
3312	as the task force deems necessary to accomplish its mission and
3313	shall provide necessary funding for the task force within the
3314	office's existing resources. The Executive Office of the
3315	Governor, the Department of Financial Services, the Office of
3316	Insurance Regulation, the Department of Highway Safety and Motor
3317	Vehicles, and the Department of Community Affairs shall provide
3318	substantive staff support for the task force.
3319	(3)  MEMBERSHIP.--The members of the task force shall be
3320	appointed as follows:
3321	(a)  The Governor shall appoint two members who have
3322	expertise in financial matters, one of whom is a representative
3323	of the mobile or manufactured home industry and one of whom is a
3324	representative of insurance consumers.
3325	(b)  The Chief Financial Officer shall appoint two members
3326	who have expertise in financial matters, one of whom is a
3327	representative of a property insurer writing mobile or
3328	manufactured homeowners insurance in this state and one of whom
3329	is a representative of insurance agents.
3330	(c)  The President of the Senate shall appoint one member.
3331	(d)  The Speaker of the House of Representatives shall
3332	appoint one member.
3333	(e)  The Commissioner of Insurance Regulation or his or her
3334	designee shall serve as an ex officio voting member of the task
3335	force.
3336	(f)  The Executive Director of Citizens Property Insurance
3337	or his or her designee shall serve as an ex officio voting
3338	member of the task force.
3339	(g)  The Chief Executive Officer of the Federal Alliance
3340	for Safe Homes, Incorporated or his or her designee shall serve
3341	as an ex officio voting member of the task force.
3342
3343	Members of the task force shall serve without compensation but
3344	may receive reimbursement for per diem and travel expenses as
3345	provided in s. 112.061, Florida Statutes.
3346	(4)  PURPOSE AND INTENT.--The Legislature recognizes the
3347	continued availability of hurricane insurance coverage for
3348	mobile and manufactured home owners in this state is essential
3349	to the state's economic survival. The Legislature further
3350	recognizes hurricane mitigation measures and building codes may
3351	reduce the likelihood or amount of damage to mobile or
3352	manufactured homes in the event of a hurricane. The Legislature
3353	further recognizes mobile and manufactured homes provide safe
3354	and affordable housing to many residents of this state. The
3355	purpose of the task force is to make recommendations to the
3356	legislative and executive branches of this state's government
3357	relating to the creation and maintenance of insurance capacity
3358	in the private sector and public sector that is sufficient to
3359	ensure that all mobile and manufactured home owners in this
3360	state are able to obtain appropriate insurance coverage for
3361	hurricane losses and relating to the effectiveness of hurricane
3362	mitigation measures for mobile or manufactured homes as further
3363	described in this section.
3364	(5)  SPECIFIC TASKS.--The task force shall conduct such
3365	research and hearings as the task force deems necessary to
3366	achieve the purposes specified in subsection (4) and shall
3367	develop information on relevant issues, including, but not
3368	limited to, the following issues:
3369	(a)  Whether this state currently has sufficient hurricane
3370	insurance capacity for mobile and manufactured homes to ensure
3371	the continuation of a healthy, competitive marketplace, taking
3372	into consideration private-sector and public-sector resources.
3373	(b)  Identifying the future demands on the hurricane
3374	insurance capacity of this state, taking into account population
3375	growth, coastal growth, and anticipated future hurricane
3376	activity.
3377	(c)  Identifying how many mobile or manufactured homes are
3378	occupied in this state, how many mobile or manufactured homes
3379	are occupied by owners who also own the land to which the unit
3380	is attached, the age or average age of mobile or manufactured
3381	homes, the location of such homes, and the size of such homes.
3382	(d)  The extent to which the growth in insurance on mobile
3383	or manufactured homes in Citizens Property Insurance Corporation
3384	is attributable to insufficient insurance capacity.
3385	(e)  The extent to which the growth trends of Citizens
3386	Property Insurance Corporation create long-term problems for
3387	mobile and manufactured home owners in this state and for other
3388	persons and businesses that depend on a viable market.
3389	(f)  The extent to which insurance discounts, credits, or
3390	other rate differentials or reductions in the hurricane
3391	insurance deductible for a mobile or manufactured homeowner who
3392	takes mitigative measures would increase hurricane insurance
3393	capacity for mobile or manufactured homeowners.
3394	(g)  The extent hurricane mitigation enhancements to mobile
3395	or manufactured homes decreases the likelihood of damage from a
3396	hurricane or decreases the amount of damage from a hurricane.
3397	(h)  The extent to which the building codes reduce the
3398	likelihood of damage or amount of damage to mobile or
3399	manufactured homes.
3400	(6)  REPORT AND RECOMMENDATIONS.--By January 1, 2007, the
3401	task force shall provide a report containing findings relating
3402	to the tasks identified in subsection (5) and recommendations
3403	consistent with the purposes of this section and also consistent
3404	with such findings. The task force shall submit the report to
3405	the Governor, the Chief Financial Officer, the President of the
3406	Senate, and the Speaker of the House of Representatives. The
3407	task force may also submit such interim reports as the task
3408	force deems appropriate.
3409	(7)  EXPIRATION.--The task force shall expire on January 2,
3410	2007.
3411	Section 22.  By January 1, 2007, the Office of Insurance
3412	Regulation shall submit a report to the President of the Senate,
3413	the Speaker of the House of Representatives, the minority party
3414	leaders of the Senate and the House of Representatives, and the
3415	chairs of the standing committees of the Senate and the House of
3416	Representatives having jurisdiction over matters relating to
3417	property and casualty insurance. In preparing the report, the
3418	office shall consult with the Department of Highway Safety and
3419	Motor Vehicles, the Department of Community Affairs, the Florida
3420	Building Commission, the Florida Home Builders Association,
3421	representatives of the mobile and manufactured home industry,
3422	representatives of the property and casualty insurance industry,
3423	and any other party the office determines is appropriate. The
3424	report shall include findings and recommendations on the
3425	insurability of attached or free standing structures to
3426	residential homes, mobile, or manufactured homes, such as
3427	carports or pool enclosures; the increase or decrease in
3428	insurance costs associated with insuring such structures; the
3429	feasibility of insuring such structures; the impact on
3430	homeowners of not having insurance coverage for such structures;
3431	the ability of mitigation measures relating to such structures
3432	to reduce risk and loss; and such other related information as
3433	the office determines is appropriate for the Legislature to
3434	consider.
3435	Section 23.  (1)  By January 15, 2007, the Office of
3436	Insurance Regulation shall submit a report to the President of
3437	the Senate, the Speaker of the House of Representatives, the
3438	minority party leaders of the Senate and the House of
3439	Representatives, and the chairs of the standing committees of
3440	the Senate and the House of Representatives having jurisdiction
3441	over matters relating to property and casualty insurance. The
3442	report shall include findings and recommendations on requiring
3443	residential property insurers to provide an opportunity for
3444	policyholders to decrease the monetary amount of a hurricane
3445	deductible predicated upon the policyholder demonstrating
3446	certifiable and verifiable mitigation measures that reduce
3447	hurricane damage. As a part of the report, the office shall
3448	address the feasibility of such a requirement and the specific
3449	procedures necessary for implementation and include suggested
3450	legislation. The report may also include other related
3451	information as the office determines is appropriate for the
3452	Legislature to consider.
3453	(2)  In conducting such research and offering
3454	recommendations for the report, the office shall consult with
3455	consumers, insurers, builders, wind certification inspectors,
3456	organizations dedicated to promoting disaster safety and
3457	property loss mitigation, counties, municipalities, and state
3458	agencies as well as any other entity that the office determines
3459	could provide relevant information.
3460	Section 24.  (1)  For fiscal year 2006-2007, the sum of
3461	$100 million is appropriated from the General Revenue Fund to
3462	the Department of Financial Services for the Florida Hurricane
3463	Damage Prevention Endowment as a nonrecurring appropriation for
3464	the purposes specified in s. 215.558, Florida Statutes.
3465	(2)  The sum of $400 million is appropriated from the
3466	General Revenue Fund to the Department of Financial Services as
3467	a nonrecurring appropriation for the purposes specified in s.
3468	215.5586, Florida Statutes.
3469	(3)  Funds provided in subsections (1) and (2) shall be
3470	transferred by the department to the Florida Hurricane Damage
3471	Prevention Trust Fund, as created in s. 215.5585, Florida
3472	Statutes.
3473	(4)  For fiscal year 2006-2007, the recurring sum of $5
3474	million is appropriated to the Department of Financial Services
3475	from the Florida Hurricane Damage Prevention Trust Fund, Special
3476	Category ? Financial Incentives for Hurricane Damage Prevention.
3477	(5)  For fiscal year 2006-2007, the nonrecurring sum of
3478	$400 million is appropriated to the Department of Financial
3479	Services from the Florida Hurricane Damage Prevention Trust
3480	Fund, Special Category ? Florida Comprehensive Hurricane Damage
3481	Mitigation Program. The department may spend up to 1 percent of
3482	the funds appropriated to administer the program.
3483	Notwithstanding s. 216.301, Florida Statutes, and pursuant to s.
3484	216.351, Florida Statutes, any unexpended balance from this
3485	appropriation shall be carried forward at the end of each fiscal
3486	year until the 2010-2011 fiscal year. At the end of the 2010-
3487	2011 fiscal year, any obligated funds for qualified projects
3488	that are not yet disbursed shall remain with the department to
3489	be used for the purposes of this act. Any unobligated funds of
3490	this appropriation shall revert to the Florida Hurricane Damage
3491	Prevention Trust Fund at the end of the 2010-2011 fiscal year.
3492	Section 25.  (1)  For fiscal year 2006-2007, the sum of
3493	$920 million in nonrecurring funds is appropriated from the
3494	General Revenue Fund to the Department of Financial Services for
3495	transfer to the Citizens Property Insurance Corporation to avoid
3496	regular assessments on assessable insurers, as authorized under
3497	s. 627.351(6)(b)3.b., Florida Statutes, for the 2005 Plan Year
3498	deficit. The board of governors of the corporation shall use
3499	appropriated state moneys to fund that portion of the 2005 Plan
3500	Year deficit which would result in the levying of regular
3501	assessments in the commercial lines, personal lines, and high-
3502	risk accounts. The transfer made by the department to the
3503	corporation shall be limited to the amount of the total regular
3504	assessments that were authorized by law to cover the 2005 Plan
3505	Year deficit. Any unused and remaining funds in this
3506	appropriation shall revert to the General Revenue Fund.
3507	(2)  The corporation shall amortize over a 10-year period
3508	any emergency assessments resulting from the 2005 Plan Year
3509	deficit.
3510	Section 26.  For fiscal year 2006-2007, the sums of
3511	$250,000 in recurring funds and $425,000 in nonrecurring funds
3512	are appropriated from the Insurance Regulatory Trust Fund in the
3513	Department of Financial Services to the Office of Insurance
3514	Regulation for the purpose of carrying out reporting and
3515	administrative responsibilities of this act.
3516	Section 27.  Except as otherwise expressly provided in this
3517	act, this act shall take effect July 1, 2006.

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