CS/HB 1223

1
A bill to be entitled
2An act relating to hurricane preparedness and insurance;
3creating the Citizens Property Insurance Corporation
4Mission Review Task Force; providing purposes; requiring a
5report; providing report requirements; providing for
6appointment of members; providing responsibilities;
7specifying service without compensation; providing for
8reimbursement of per diem and travel expenses; providing
9meeting requirements; requiring the corporation to assist
10the task force; providing for the expiration of the task
11force; exempting certain residential property insurance
12rate filings from being subject to determinations by the
13Office of Insurance Regulation of being excessive or
14unfairly discriminatory; authorizing the office to
15disapprove certain rates as inadequate or disapprove
16certain filings under certain circumstances; providing
17requirements and procedures for filing rates and review of
18rate filings by the office; providing for application only
19to residential property insurance; requiring the Chief
20Financial Officer to provide a report on the economic
21impact on the state of certain hurricanes; providing
22report requirements; amending s. 553.73, F.S.; limiting
23the authority of the Florida Building Commission to modify
24certain codes and standards under certain circumstances;
25requiring counties and municipalities to enforce certain
26windborne debris protections and structural guidelines;
27requiring the commission to amend the Florida Building
28Code to require application of certain standards and
29eliminate certain exceptions; prohibiting amendment of the
30Florida Building Code to diminish certain requirements;
31authorizing the commission to amend the code to enhance
32certain requirements; amending s. 10, ch. 2007-1, Laws of
33Florida; revising reporting requirements for the
34commission's voluntary "Code Plus" guidelines; repealing
35s. 9, ch. 2007-1, Laws of Florida, relating to certain
36windborne debris protection requirements enforcement;
37providing an appropriation; providing an effective date.
38
39Be It Enacted by the Legislature of the State of Florida:
40
41     Section 1.  (1)  The Citizens Property Insurance
42Corporation Mission Review Task Force is created to analyze and
43compile available data and to develop a report setting forth the
44statutory and operational changes needed to return Citizens
45Property Insurance Corporation to its former role as a state-
46created, noncompetitive residual market mechanism that provides
47property insurance coverage to risks that are otherwise entitled
48but unable to obtain such coverage in the private insurance
49market. The task force shall submit a report to the Governor,
50the President of the Senate, and the Speaker of the House of
51Representatives by January 31, 2008. At a minimum, the task
52force shall analyze and evaluate relevant and applicable
53information and data and develop recommendations concerning:
54     (a)  The nature of Citizens Property Insurance
55Corporation's role in providing property insurance coverage when
56and only if such coverage is not available from private
57insurers.
58     (b)  The ability of the admitted market to offer policies
59to those consumers formerly insured through Citizens Property
60Insurance Corporation. This consideration shall include, but not
61be limited to, the availability of private market reinsurance
62and coverage through the Florida Hurricane Catastrophe Fund, the
63general adequacy of the admitted market's current rates, and the
64capacity of the industry to offer policies to former Citizens
65Property Insurance Corporation policyholders within existing
66writing ratio limitations.
67     (c)  The appropriate relationship of rates charged by
68Citizens Property Insurance Corporation to rates charged by
69private insurers, with due consideration for the corporation's
70role as a noncompetitive residual market mechanism.
71     (d)  The relationships between the exposure of Citizens
72Property Insurance Corporation to catastrophic hurricane losses,
73the corporation's history of purchasing inadequate or no
74reinsurance coverage, and the corporation's lack of adequate
75capital to meet its potential claim obligations without
76incurring large deficits.
77     (e)  The adverse effects on the people and the economy of
78this state of the large, multiyear deficit assessments by
79Citizens Property Insurance Corporation that may be levied on
80businesses and households in this state, and steps that can be
81taken to reduce those effects.
82     (f)  The operational implications of the variation in the
83number of policies in force over time in Citizens Property
84Insurance Corporation and the merits of outsourcing some or all
85of its operational responsibilities.
86     (g)  Changes in the mission and operations of Citizens
87Property Insurance Corporation to reduce or eliminate any
88adverse effect such mission and operations may be having on the
89promotion of sound and economic growth and development of the
90coastal areas of this state.
91     (2)  The task force shall be composed of 17 members as
92follows:
93     (a)  Three members appointed by the Speaker of the House of
94Representatives.
95     (b)  Three members appointed by the President of the
96Senate.
97     (c)  Three members appointed by the Governor who are not
98employed by or professionally affiliated with an insurance
99company or a subsidiary of an insurance company.
100     (d)  Eight members appointed as representatives of private
101insurance companies as follows:
102     1.  Two members representing two separate insurance
103companies in this state that each provide at least 300,000
104property insurance policies statewide at the time of the
105creation of the task force.
106     2.  Two members representing two separate insurance
107companies in this state that each provide at least 100,000 but
108no more than 299,000 property insurance policies statewide at
109the time of the creation of the task force.
110     3.  Two members representing two separate insurance
111companies in this state that each provide fewer than 100,000
112property insurance policies statewide at the time of the
113creation of the task force.
114     4.  Two members appointed by the Chief Financial Officer
115representing insurance agents in this state, at least one of
116whom represents the largest property and casualty insurance
117agent's association in this state.
118
119Of each pair of members appointed under subparagraphs 1., 2.,
120and 3., one shall be appointed by the President of the Senate
121and one by the Speaker of the House of Representatives.
122     (3)  The task force shall conduct research, hold public
123meetings, receive testimony, employ consultants and
124administrative staff, and undertake other activities determined
125by its members to be necessary to complete its responsibilities.
126Citizens Property Insurance Corporation shall have appropriate
127senior staff attend task force meetings, shall respond to
128requests for testimony and data by the task force, and shall
129otherwise cooperate with the task force.
130     (4)  A member of the task force may not delegate his or her
131attendance or voting power to a designee.
132     (5)  Members of the task force shall serve without
133compensation but are entitled to receive reimbursement for
134travel and per diem as provided in s. 112.061, Florida Statutes.
135     (6)  The appointments to the task force must be completed
136within 30 calendar days after the effective date of this act,
137and the task force must hold its initial meeting within 1 month
138after appointment of all members. The task force shall expire no
139later than 60 calendar days after submission of the report
140required in subsection (1).
141     Section 2.  (1)  Effective January 1, 2008, notwithstanding
142any other provision of this section, with respect to any
143residential property insurance, a rate filing, including, but
144not limited to, any rate changes, rating factors, territories,
145classification, discounts, and credits, with respect to any
146policy form, including endorsements issued with the form, that
147results in an overall average statewide premium increase shall
148not be subject to a determination by the Office of Insurance
149Regulation that the rate is excessive or unfairly discriminatory
150or in violation of any other provision of law.
151     (2)  The Office of Insurance Regulation may disapprove a
152rate as inadequate or disapprove a filing for the use of rating
153factors prohibited by the laws of this state. An insurer
154electing to implement a rate change under subsection (1) shall
155submit a filing to the office at least 40 days prior to the
156effective date of the rate change. The office shall have 30 days
157after the submission of the filing to review the filing and
158determine whether the rate is inadequate or uses rating factors
159prohibited by the laws of this state. Absent a finding by the
160office within such 30-day period that the rate is inadequate or
161that the insurer has used rating factors prohibited by the laws
162of this state, the filing is deemed approved. If the office
163finds during the 30-day period that the filing will result in
164inadequate premiums or otherwise endanger the insurer's
165solvency, the office shall suspend the rate change. If the
166insurer is implementing an overall rate increase that would
167continue to produce an inadequate rate, such increase shall
168proceed pending additional action by the office to ensure the
169adequacy of the rate.
170     (3)  This section does not apply to rate filings for any
171insurance other than residential property insurance.
172     Section 3.  The Chief Financial Officer shall provide a
173report on the economic impact on the state of a 1-in-250-year
174hurricane to the Governor, the President of the Senate, and the
175Speaker of the House of Representatives by March 1 of each year.
176The report shall include an estimate of the short-term and long-
177term fiscal impacts of such a storm on Citizens Property
178Insurance Corporation, the Florida Hurricane Catastrophe Fund,
179the private insurance and reinsurance markets, the state
180economy, and the state debt. The report may also include
181recommendations by the Chief Financial Officer for preparing for
182such a hurricane and reducing the economic impact of such a
183hurricane on the state. In preparing the analysis, the Chief
184Financial Officer shall coordinate with and obtain data from the
185Office of Insurance Regulation, Citizens Property Insurance
186Corporation, the Florida Hurricane Catastrophe Fund, the Florida
187Commission on Hurricane Loss Projection Methodology, the State
188Board of Administration, the Office of Economic and Demographic
189Research, and other state agencies.
190     Section 4.  Subsection (3) of section 553.73, Florida
191Statutes, as amended by chapter 2007-1, Laws of Florida, is
192amended, and subsection (13) is added to that section, to read:
193     553.73  Florida Building Code.--
194     (3)  The commission shall select from available national or
195international model building codes, or other available building
196codes and standards currently recognized by the laws of this
197state, to form the foundation for the Florida Building Code. The
198commission may modify the selected model codes and standards as
199needed to accommodate the specific needs of this state, but only
200to the extent that any such modifications strengthen, not
201weaken, the structural integrity of buildings constructed in
202compliance with provisions of the Florida Building Code relating
203to wind protection. Standards or criteria referenced by the
204selected model codes shall be similarly incorporated by
205reference. If a referenced standard or criterion requires
206amplification or modification to be appropriate for use in this
207state, only the amplification or modification shall be
208specifically set forth in the Florida Building Code. The Florida
209Building Commission may approve technical amendments to the
210code, subject to the requirements of subsections (7) and (8),
211after the amendments have been subject to the following
212conditions:
213     (a)  The proposed amendment has been published on the
214commission's website for a minimum of 45 days and all the
215associated documentation has been made available to any
216interested party before any consideration by any Technical
217Advisory Committee;
218     (b)  In order for a Technical Advisory Committee to make a
219favorable recommendation to the commission, the proposal must
220receive a three-fourths vote of the members present at the
221Technical Advisory Committee meeting and at least half of the
222regular members must be present in order to conduct a meeting;
223     (c)  After Technical Advisory Committee consideration and a
224recommendation for approval of any proposed amendment, the
225proposal must be published on the commission's website for not
226less than 45 days before any consideration by the commission;
227and
228     (d)  Any proposal may be modified by the commission based
229on public testimony and evidence from a public hearing held in
230accordance with chapter 120.
231
232The commission shall incorporate within sections of the Florida
233Building Code provisions which address regional and local
234concerns and variations, but only to the extent that any such
235modifications strengthen, not weaken, the structural integrity
236of buildings constructed in compliance with provisions of the
237Florida Building Code relating to wind protection. The
238commission shall make every effort to minimize conflicts between
239the Florida Building Code, the Florida Fire Prevention Code, and
240the Life Safety Code.
241     (13)  Each county and municipality in this state shall, at
242a minimum, enforce the windborne debris protections and
243structural guidelines adopted by the American Society of Civil
244Engineers in the standard commonly referred to as ASCE 7-02.
245Notwithstanding s. 109, chapter 2000-141, Laws of Florida, the
246Florida Building Commission shall amend the Florida Building
247Code to require application of ASCE 7-02 throughout the state
248and to eliminate all exceptions providing less stringent
249requirements. Provisions of the Florida Building Code, including
250those contained in referenced standards and criteria, relating
251to wind resistance shall not be amended pursuant to this
252subsection to diminish construction requirements; however, the
253commission may amend the provisions to enhance those
254construction requirements.
255     Section 5.  Subsection (2) of section 10 of chapter 2007-1,
256Laws of Florida, is amended to read:
257     Section 10.
258     (2)  The Florida Building Commission shall develop
259voluntary "Code Plus" guidelines for increasing the hurricane
260resistance of buildings. The guidelines may be modeled on the
261requirements for the High Velocity Hurricane Zone and must
262identify products, systems, and methods of construction that the
263commission anticipates could result in stronger construction.
264The commission shall include these guidelines in its report to
265the President of the Senate and the Speaker of the House of
266Representatives during the 2008 Regular Session of the
267Legislature.
268     Section 6.  Section 9 of chapter 2007-1, Laws of Florida,
269is repealed.
270     Section 7.  For the 2007-2008 fiscal year, the nonrecurring
271sum of $250,000 is appropriated from the General Revenue Fund
272for the purpose of implementing the provisions of this act
273relating to the Citizens Property Insurance Corporation Mission
274Review Task Force.
275     Section 8.  This act shall take effect upon becoming a law.


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