Amendment
Bill No. 1267

Amendment No. 218561

CHAMBER ACTION
Senate		House
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1	Representative Ross offered the following:
2
3	Amendment (with title amendment)
4	Remove lines 62-728 and insert:
5	Section 2.  Present paragraphs (s) through (ee) of
6	subsection (6) of section 627.351, Florida Statutes, as amended
7	by section 21 of chapter 2007-1, Laws of Florida, are
8	redesignated as paragraphs (r) through (dd), and present
9	paragraphs (a), (b), (c), (m), and (r) of subsection (6) of that
10	section are amended, to read:
11	627.351  Insurance risk apportionment plans.--
12	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
13	(a)1.  It is the public purpose of this subsection to
14	ensure the existence of an orderly market for property insurance
15	for citizens of this state and businesses in this state. The
16	Legislature finds that private insurers are unwilling or unable
17	to provide affordable property insurance coverage in this state
18	to the extent sought and needed. The absence of affordable
19	property insurance threatens the public health, safety, and
20	welfare and likewise threatens the economic health of the state.
21	The state therefore has a compelling public interest and a
22	public purpose to assist in ensuring that property in the state
23	is insured and that property is insured at affordable rates so
24	as to facilitate the remediation, reconstruction, and
25	replacement of damaged or destroyed property in order to reduce
26	or avoid the negative effects otherwise resulting to the public
27	health, safety, and welfare, to the economy of the state, and to
28	the revenues of the state and local governments which are needed
29	to provide for the public welfare. It is necessary, therefore,
30	to provide affordable property insurance to applicants who are
31	in good faith entitled to procure insurance through the
32	voluntary market but are unable to do so. The Legislature
33	intends by this subsection that affordable property insurance be
34	provided and that such insurance continue to be provided, as
35	long as necessary, through Citizens Property Insurance
36	Corporation, a government entity that is an integral part of the
37	state and that is not a private insurance company. To that end,
38	Citizens Property Insurance Company shall strive to increase the
39	availability of affordable property insurance in this state,
40	while achieving efficiencies and economies and while providing
41	service to policyholders, applicants, and agents which is no
42	less than the quality generally provided in the voluntary
43	market, for the achievement of the foregoing public purposes.
44	Because it is essential for this government entity to have the
45	maximum financial resources to pay claims following a
46	catastrophic hurricane, it is the intent of the Legislature that
47	Citizens Property Insurance Corporation continue to be an
48	integral part of the state and that the income of the
49	corporation be exempt from federal income taxation and that
50	interest on the debt obligations issued by the corporation be
51	exempt from federal income taxation. The Legislature finds that
52	actual and threatened catastrophic losses to property in this
53	state from hurricanes have caused insurers to be unwilling or
54	unable to provide property insurance coverage to the extent
55	sought and needed. It is in the public interest and a public
56	purpose to assist in assuring that property in the state is
57	insured so as to facilitate the remediation, reconstruction, and
58	replacement of damaged or destroyed property in order to reduce
59	or avoid the negative effects otherwise resulting to the public
60	health, safety, and welfare; to the economy of the state; and to
61	the revenues of the state and local governments needed to
62	provide for the public welfare. It is necessary, therefore, to
63	provide property insurance to applicants who are in good faith
64	entitled to procure insurance through the voluntary market but
65	are unable to do so. The Legislature intends by this subsection
66	that property insurance be provided and that it continues, as
67	long as necessary, through an entity organized to achieve
68	efficiencies and economies, while providing service to
69	policyholders, applicants, and agents that is no less than the
70	quality generally provided in the voluntary market, all toward
71	the achievement of the foregoing public purposes. Because it is
72	essential for the corporation to have the maximum financial
73	resources to pay claims following a catastrophic hurricane, it
74	is the intent of the Legislature that the income of the
75	corporation be exempt from federal income taxation and that
76	interest on the debt obligations issued by the corporation be
77	exempt from federal income taxation.
78	2.  The Residential Property and Casualty Joint
79	Underwriting Association originally created by this statute
80	shall be known, as of July 1, 2002, as the Citizens Property
81	Insurance Corporation. The corporation shall provide insurance
82	for residential and commercial property, for applicants who are
83	in good faith entitled, but are unable, to procure insurance
84	through the voluntary market. The corporation shall operate
85	pursuant to a plan of operation approved by order of the
86	Financial Services Commission. The plan is subject to continuous
87	review by the commission. The commission may, by order, withdraw
88	approval of all or part of a plan if the commission determines
89	that conditions have changed since approval was granted and that
90	the purposes of the plan require changes in the plan. The
91	corporation shall continue to operate pursuant to the plan of
92	operation approved by the Office of Insurance Regulation until
93	October 1, 2006. For the purposes of this subsection,
94	residential coverage includes both personal lines residential
95	coverage, which consists of the type of coverage provided by
96	homeowner's, mobile home owner's, dwelling, tenant's,
97	condominium unit owner's, and similar policies, and commercial
98	lines residential coverage, which consists of the type of
99	coverage provided by condominium association, apartment
100	building, and similar policies.
101	3.  For the purposes of this subsection, the term
102	"homestead property" means:
103	a.  Property that has been granted a homestead exemption
104	under chapter 196;
105	b.  Property for which the owner has a current, written
106	lease with a renter for a term of at least 7 months and for
107	which the dwelling is insured by the corporation for $200,000 or
108	less;
109	c.  An owner-occupied mobile home or manufactured home, as
110	defined in s. 320.01, which is permanently affixed to real
111	property, is owned by a Florida resident, and has been granted a
112	homestead exemption under chapter 196 or, if the owner does not
113	own the real property, the owner certifies that the mobile home
114	or manufactured home is his or her principal place of residence;
115	d.  Tenant's coverage;
116	e.  Commercial lines residential property; or
117	f.  Any county, district, or municipal hospital; a hospital
118	licensed by any not-for-profit corporation qualified under s.
119	501(c)(3) of the United States Internal Revenue Code; or a
120	continuing care retirement community that is certified under
121	chapter 651 and that receives an exemption from ad valorem taxes
122	under chapter 196.
123	4.  For the purposes of this subsection, the term
124	"nonhomestead property" means property that is not homestead
125	property.
126	5.  Effective July 1, 2008, a personal lines residential
127	structure that has a dwelling replacement cost of $1 million or
128	more, or a single condominium unit that has a combined dwelling
129	and content replacement cost of $1 million or more is not
130	eligible for coverage by the corporation. Such dwellings insured
131	by the corporation on June 30, 2008, may continue to be covered
132	by the corporation until the end of the policy term. However,
133	such dwellings that are insured by the corporation and become
134	ineligible for coverage due to the provisions of this
135	subparagraph may reapply and obtain coverage in the high-risk
136	account and be considered "nonhomestead property" if the
137	property owner provides the corporation with a sworn affidavit
138	from one or more insurance agents, on a form provided by the
139	corporation, stating that the agents have made their best
140	efforts to obtain coverage and that the property has been
141	rejected for coverage by at least one authorized insurer and at
142	least three surplus lines insurers. If such conditions are met,
143	the dwelling may be insured by the corporation for up to 3
144	years, after which time the dwelling is ineligible for coverage.
145	The office shall approve the method used by the corporation for
146	valuing the dwelling replacement cost for the purposes of this
147	subparagraph. If a policyholder is insured by the corporation
148	prior to being determined to be ineligible pursuant to this
149	subparagraph and such policyholder files a lawsuit challenging
150	the determination, the policyholder may remain insured by the
151	corporation until the conclusion of the litigation.
152	6.  For properties constructed on or after January 1, 2009,
153	the corporation may not insure any property located within 2,500
154	feet landward of the coastal construction control line created
155	pursuant to s. 161.053 unless the property meets the
156	requirements of the code-plus building standards developed by
157	the Florida Building Commission.
158	7.  It is the intent of the Legislature that policyholders,
159	applicants, and agents of the corporation receive service and
160	treatment of the highest possible level but never less than that
161	generally provided in the voluntary market. It also is intended
162	that the corporation be held to service standards no less than
163	those applied to insurers in the voluntary market by the office
164	with respect to responsiveness, timeliness, customer courtesy,
165	and overall dealings with policyholders, applicants, or agents
166	of the corporation.
167	(b)1.  All insurers authorized to write one or more subject
168	lines of business in this state are subject to assessment by the
169	corporation and, for the purposes of this subsection, are
170	referred to collectively as "assessable insurers." Insurers
171	writing one or more subject lines of business in this state
172	pursuant to part VIII of chapter 626 are not assessable
173	insurers, but insureds who procure one or more subject lines of
174	business in this state pursuant to part VIII of chapter 626 are
175	subject to assessment by the corporation and are referred to
176	collectively as "assessable insureds." An authorized insurer's
177	assessment liability shall begin on the first day of the
178	calendar year following the year in which the insurer was issued
179	a certificate of authority to transact insurance for subject
180	lines of business in this state and shall terminate 1 year after
181	the end of the first calendar year during which the insurer no
182	longer holds a certificate of authority to transact insurance
183	for subject lines of business in this state.
184	1.a. 2.a.  All revenues, assets, liabilities, losses, and
185	expenses of the corporation shall be divided into three separate
186	accounts as follows:
187	(I)  A personal lines account for personal residential
188	policies issued by the corporation or issued by the Residential
189	Property and Casualty Joint Underwriting Association and renewed
190	by the corporation that provide comprehensive, multiperil
191	coverage on risks that are not located in areas eligible for
192	coverage in the Florida Windstorm Underwriting Association as
193	those areas were defined on January 1, 2002, and for such
194	policies that do not provide coverage for the peril of wind on
195	risks that are located in such areas;
196	(II)  A commercial lines account for commercial residential
197	and commercial nonresidential policies issued by the corporation
198	or issued by the Residential Property and Casualty Joint
199	Underwriting Association and renewed by the corporation that
200	provide coverage for basic property perils on risks that are not
201	located in areas eligible for coverage in the Florida Windstorm
202	Underwriting Association as those areas were defined on January
203	1, 2002, and for such policies that do not provide coverage for
204	the peril of wind on risks that are located in such areas; and
205	(III)  A high-risk account for personal residential
206	policies and commercial residential and commercial
207	nonresidential property policies issued by the corporation or
208	transferred to the corporation that provide coverage for the
209	peril of wind on risks that are located in areas eligible for
210	coverage in the Florida Windstorm Underwriting Association as
211	those areas were defined on January 1, 2002. Subject to the
212	approval of a business plan by the Financial Services Commission
213	and Legislative Budget Commission as provided in this sub-sub-
214	subparagraph, but no earlier than March 31, 2007, the
215	corporation may offer policies that provide multiperil coverage
216	and the corporation shall continue to offer policies that
217	provide coverage only for the peril of wind for risks located in
218	areas eligible for coverage in the high-risk account. In issuing
219	multiperil coverage, the corporation may use its approved policy
220	forms and rates for the personal lines account. An applicant or
221	insured who is eligible to purchase a multiperil policy from the
222	corporation may purchase a multiperil policy from an authorized
223	insurer without prejudice to the applicant's or insured's
224	eligibility to prospectively purchase a policy that provides
225	coverage only for the peril of wind from the corporation. An
226	applicant or insured who is eligible for a corporation policy
227	that provides coverage only for the peril of wind may elect to
228	purchase or retain such policy and also purchase or retain
229	coverage excluding wind from an authorized insurer without
230	prejudice to the applicant's or insured's eligibility to
231	prospectively purchase a policy that provides multiperil
232	coverage from the corporation. It is the goal of the Legislature
233	that there would be an overall average savings of 10 percent or
234	more for a policyholder who currently has a wind-only policy
235	with the corporation, and an ex-wind policy with a voluntary
236	insurer or the corporation, and who then obtains a multiperil
237	policy from the corporation. It is the intent of the Legislature
238	that the offer of multiperil coverage in the high-risk account
239	be made and implemented in a manner that does not adversely
240	affect the tax-exempt status of the corporation or
241	creditworthiness of or security for currently outstanding
242	financing obligations or credit facilities of the high-risk
243	account, the personal lines account, or the commercial lines
244	account. By March 1, 2007, the corporation shall prepare and
245	submit for approval by the Financial Services Commission and
246	Legislative Budget Commission a report detailing the
247	corporation's business plan for issuing multiperil coverage in
248	the high-risk account. The business plan shall be approved or
249	disapproved within 30 days after receipt, as submitted or
250	modified and resubmitted by the corporation. The business plan
251	must include: the impact of such multiperil coverage on the
252	corporation's financial resources, the impact of such multiperil
253	coverage on the corporation's tax-exempt status, the manner in
254	which the corporation plans to implement the processing of
255	applications and policy forms for new and existing
256	policyholders, the impact of such multiperil coverage on the
257	corporation's ability to deliver customer service at the high
258	level required by this subsection, the ability of the
259	corporation to process claims, the ability of the corporation to
260	quote and issue policies, the impact of such multiperil coverage
261	on the corporation's agents, the impact of such multiperil
262	coverage on the corporation's existing policyholders, and the
263	impact of such multiperil coverage on rates and premium. The
264	high-risk account must also include quota share primary
265	insurance under subparagraph (c)2. The area eligible for
266	coverage under the high-risk account also includes the area
267	within Port Canaveral, which is bordered on the south by the
268	City of Cape Canaveral, bordered on the west by the Banana
269	River, and bordered on the north by Federal Government property.
270	b.  The three separate accounts must be maintained as long
271	as financing obligations entered into by the Florida Windstorm
272	Underwriting Association or Residential Property and Casualty
273	Joint Underwriting Association are outstanding, in accordance
274	with the terms of the corresponding financing documents. When
275	the financing obligations are no longer outstanding, in
276	accordance with the terms of the corresponding financing
277	documents, the corporation may use a single account for all
278	revenues, assets, liabilities, losses, and expenses of the
279	corporation. Consistent with the requirement of this
280	subparagraph and prudent investment policies that minimize the
281	cost of carrying debt, the board shall exercise its best efforts
282	to retire existing debt or to obtain approval of necessary
283	parties to amend the terms of existing debt, so as to structure
284	the most efficient plan to consolidate the three separate
285	accounts into a single account. By February 1, 2007, the board
286	shall submit a report to the Financial Services Commission, the
287	President of the Senate, and the Speaker of the House of
288	Representatives which includes an analysis of consolidating the
289	accounts, the actions the board has taken to minimize the cost
290	of carrying debt, and its recommendations for executing the most
291	efficient plan.
292	c.  Creditors of the Residential Property and Casualty
293	Joint Underwriting Association shall have a claim against, and
294	recourse to, the accounts referred to in sub-sub-subparagraphs
295	a.(I) and (II) and shall have no claim against, or recourse to,
296	the account referred to in sub-sub-subparagraph a.(III).
297	Creditors of the Florida Windstorm Underwriting Association
298	shall have a claim against, and recourse to, the account
299	referred to in sub-sub-subparagraph a.(III) and shall have no
300	claim against, or recourse to, the accounts referred to in sub-
301	sub-subparagraphs a.(I) and (II).
302	d.  Revenues, assets, liabilities, losses, and expenses not
303	attributable to particular accounts shall be prorated among the
304	accounts.
305	e.  The Legislature finds that the revenues of the
306	corporation are revenues that are necessary to meet the
307	requirements set forth in documents authorizing the issuance of
308	bonds under this subsection.
309	f.  No part of the income of the corporation may inure to
310	the benefit of any private person.
311	2. 3.  With respect to a deficit in an account:
312	a.  When the deficit incurred in a particular calendar year
313	is not greater than 10 percent of the aggregate statewide direct
314	written premium for the subject lines of business for the prior
315	calendar year, the entire deficit shall be recovered through
316	regular assessments of assessable insurers under paragraph (p)
317	and assessable insureds.
318	b.  When the deficit incurred in a particular calendar year
319	exceeds 10 percent of the aggregate statewide direct written
320	premium for the subject lines of business for the prior calendar
321	year, the corporation shall levy regular assessments on
322	assessable insurers under paragraph (p) and on assessable
323	insureds in an amount equal to the greater of 10 percent of the
324	deficit or 10 percent of the aggregate statewide direct written
325	premium for the subject lines of business for the prior calendar
326	year. Any remaining deficit shall be recovered through emergency
327	assessments under sub-subparagraph d.
328	c.  Each assessable insurer's share of the amount being
329	assessed under sub-subparagraph a. or sub-subparagraph b. shall
330	be in the proportion that the assessable insurer's direct
331	written premium for the subject lines of business for the year
332	preceding the assessment bears to the aggregate statewide direct
333	written premium for the subject lines of business for that year.
334	The assessment percentage applicable to each assessable insured
335	is the ratio of the amount being assessed under sub-subparagraph
336	a. or sub-subparagraph b. to the aggregate statewide direct
337	written premium for the subject lines of business for the prior
338	year. Assessments levied by the corporation on assessable
339	insurers under sub-subparagraphs a. and b. shall be paid as
340	required by the corporation's plan of operation and paragraph
341	(p). Notwithstanding any other provision of this subsection, the
342	aggregate amount of a regular assessment for a deficit incurred
343	in a particular calendar year shall be reduced by the estimated
344	amount to be received by the corporation from the Citizens
345	policyholder surcharge under subparagraph (c)11. and the amount
346	collected or estimated to be collected from the assessment on
347	Citizens policyholders pursuant to sub-subparagraph i.
348	Assessments levied by the corporation on assessable insureds
349	under sub-subparagraphs a. and b. shall be collected by the
350	surplus lines agent at the time the surplus lines agent collects
351	the surplus lines tax required by s. 626.932 and shall be paid
352	to the Florida Surplus Lines Service Office at the time the
353	surplus lines agent pays the surplus lines tax to the Florida
354	Surplus Lines Service Office. Upon receipt of regular
355	assessments from surplus lines agents, the Florida Surplus Lines
356	Service Office shall transfer the assessments directly to the
357	corporation as determined by the corporation.
358	d.  Upon a determination by the board of governors that a
359	deficit in an account exceeds the amount that will be recovered
360	through regular assessments under sub-subparagraph a. or sub-
361	subparagraph b., the board shall levy, after verification by the
362	office, emergency assessments, for as many years as necessary to
363	cover the deficits, to be collected by assessable insurers and
364	the corporation and collected from assessable insureds upon
365	issuance or renewal of policies for subject lines of business,
366	excluding National Flood Insurance policies. The amount of the
367	emergency assessment collected in a particular year shall be a
368	uniform percentage of that year's direct written premium for
369	subject lines of business and all accounts of the corporation,
370	excluding National Flood Insurance Program policy premiums, as
371	annually determined by the board and verified by the office. The
372	office shall verify the arithmetic calculations involved in the
373	board's determination within 30 days after receipt of the
374	information on which the determination was based.
375	Notwithstanding any other provision of law, the corporation and
376	each assessable insurer that writes subject lines of business
377	shall collect emergency assessments from its policyholders
378	without such obligation being affected by any credit,
379	limitation, exemption, or deferment. Emergency assessments
380	levied by the corporation on assessable insureds shall be
381	collected by the surplus lines agent at the time the surplus
382	lines agent collects the surplus lines tax required by s.
383	626.932 and shall be paid to the Florida Surplus Lines Service
384	Office at the time the surplus lines agent pays the surplus
385	lines tax to the Florida Surplus Lines Service Office. The
386	emergency assessments so collected shall be transferred directly
387	to the corporation on a periodic basis as determined by the
388	corporation and shall be held by the corporation solely in the
389	applicable account. The aggregate amount of emergency
390	assessments levied for an account under this sub-subparagraph in
391	any calendar year may not exceed the greater of 10 percent of
392	the amount needed to cover the original deficit, plus interest,
393	fees, commissions, required reserves, and other costs associated
394	with financing of the original deficit, or 10 percent of the
395	aggregate statewide direct written premium for subject lines of
396	business and for all accounts of the corporation for the prior
397	year, plus interest, fees, commissions, required reserves, and
398	other costs associated with financing the original deficit.
399	e.  The corporation may pledge the proceeds of assessments,
400	projected recoveries from the Florida Hurricane Catastrophe
401	Fund, other insurance and reinsurance recoverables, policyholder
402	surcharges and other surcharges, and other funds available to
403	the corporation as the source of revenue for and to secure bonds
404	issued under paragraph (p), bonds or other indebtedness issued
405	under subparagraph (c)3., or lines of credit or other financing
406	mechanisms issued or created under this subsection, or to retire
407	any other debt incurred as a result of deficits or events giving
408	rise to deficits, or in any other way that the board determines
409	will efficiently recover such deficits. The purpose of the lines
410	of credit or other financing mechanisms is to provide additional
411	resources to assist the corporation in covering claims and
412	expenses attributable to a catastrophe. As used in this
413	subsection, the term "assessments" includes regular assessments
414	under sub-subparagraph a., sub-subparagraph b., or subparagraph
415	(p)1. and emergency assessments under sub-subparagraph d.
416	Emergency assessments collected under sub-subparagraph d. are
417	not part of an insurer's rates, are not premium, and are not
418	subject to premium tax, fees, or commissions; however, failure
419	to pay the emergency assessment shall be treated as failure to
420	pay premium. The emergency assessments under sub-subparagraph d.
421	shall continue as long as any bonds issued or other indebtedness
422	incurred with respect to a deficit for which the assessment was
423	imposed remain outstanding, unless adequate provision has been
424	made for the payment of such bonds or other indebtedness
425	pursuant to the documents governing such bonds or other
426	indebtedness.
427	f.  As used in this subsection, the term "subject lines of
428	business" means insurance written by assessable insurers or
429	procured by assessable insureds for all property and casualty
430	lines of business in this state, but not including workers'
431	compensation or medical malpractice. As used in the sub-
432	subparagraph, the term "property and casualty lines of business"
433	includes all lines of business identified on Form 2, Exhibit of
434	Premiums and Losses, in the annual statement required of
435	authorized insurers by s. 624.424 and any rule adopted under
436	this section, except for those lines identified as accident and
437	health insurance and except for policies written under the
438	National Flood Insurance program or the Federal Crop Insurance
439	Program. For purposes of this sub-subparagraph, the term
440	"workers' compensation" includes both workers' compensation
441	insurance and excess workers' compensation insurance.
442	g.  The Florida Surplus Lines Service Office shall
443	determine annually the aggregate statewide written premium in
444	subject lines of business procured by assessable insureds and
445	shall report that information to the corporation in a form and
446	at a time the corporation specifies to ensure that the
447	corporation can meet the requirements of this subsection and the
448	corporation's financing obligations.
449	h.  The Florida Surplus Lines Service Office shall verify
450	the proper application by surplus lines agents of assessment
451	percentages for regular assessments and emergency assessments
452	levied under this subparagraph on assessable insureds and shall
453	assist the corporation in ensuring the accurate, timely
454	collection and payment of assessments by surplus lines agents as
455	required by the corporation.
456	b. i.  If a deficit is incurred in any account in 2008 or
457	thereafter, the board of governors shall levy an immediate
458	assessment against the premium of each nonhomestead property
459	policyholder in all accounts of the corporation, as a uniform
460	percentage of the premium of the policy of up to 10 percent of
461	such premium, which funds shall be used to offset the deficit.
462	If this assessment is insufficient to eliminate the deficit, the
463	board of governors shall levy an additional assessment against
464	all policyholders of the corporation, which shall be collected
465	at the time of issuance or renewal of a policy, as a uniform
466	percentage of the premium for the policy of up to 10 percent of
467	such premium, which funds shall be used to further offset the
468	deficit.
469	c. j.  The board of governors shall maintain separate
470	accounting records that consolidate data for nonhomestead
471	properties, including, but not limited to, number of policies,
472	insured values, premiums written, and losses. The board of
473	governors shall annually report to the office and the
474	Legislature a summary of such data.
475	(c)  The plan of operation of the corporation:
476	1.  Must provide for adoption of residential property and
477	casualty insurance policy forms and commercial residential and
478	nonresidential property insurance forms, which forms must be
479	approved by the office prior to use. The corporation shall adopt
480	the following policy forms:
481	a.  Standard personal lines policy forms that are
482	comprehensive multiperil policies providing full coverage of a
483	residential property equivalent to the coverage provided in the
484	private insurance market under an HO-3, HO-4, or HO-6 policy.
485	b.  Basic personal lines policy forms that are policies
486	similar to an HO-8 policy or a dwelling fire policy that provide
487	coverage meeting the requirements of the secondary mortgage
488	market, but which coverage is more limited than the coverage
489	under a standard policy.
490	c.  Commercial lines residential and nonresidential policy
491	forms that are generally similar to the basic perils of full
492	coverage obtainable for commercial residential structures and
493	commercial nonresidential structures in the admitted voluntary
494	market.
495	d.  Personal lines and commercial lines residential
496	property insurance forms that cover the peril of wind only. The
497	forms are applicable only to residential properties located in
498	areas eligible for coverage under the high-risk account referred
499	to in sub-subparagraph (b)2.a.
500	e.  Commercial lines nonresidential property insurance
501	forms that cover the peril of wind only. The forms are
502	applicable only to nonresidential properties located in areas
503	eligible for coverage under the high-risk account referred to in
504	sub-subparagraph (b)2.a.
505	f.  The corporation may adopt variations of the policy
506	forms listed in sub-subparagraphs a.-e. that contain more
507	restrictive coverage.
508	2.a.  Must provide that the corporation adopt a program in
509	which the corporation and authorized insurers enter into quota
510	share primary insurance agreements for hurricane coverage, as
511	defined in s. 627.4025(2)(a), for eligible risks, and adopt
512	property insurance forms for eligible risks which cover the
513	peril of wind only. As used in this subsection, the term:
514	(I)  "Quota share primary insurance" means an arrangement
515	in which the primary hurricane coverage of an eligible risk is
516	provided in specified percentages by the corporation and an
517	authorized insurer. The corporation and authorized insurer are
518	each solely responsible for a specified percentage of hurricane
519	coverage of an eligible risk as set forth in a quota share
520	primary insurance agreement between the corporation and an
521	authorized insurer and the insurance contract. The
522	responsibility of the corporation or authorized insurer to pay
523	its specified percentage of hurricane losses of an eligible
524	risk, as set forth in the quota share primary insurance
525	agreement, may not be altered by the inability of the other
526	party to the agreement to pay its specified percentage of
527	hurricane losses. Eligible risks that are provided hurricane
528	coverage through a quota share primary insurance arrangement
529	must be provided policy forms that set forth the obligations of
530	the corporation and authorized insurer under the arrangement,
531	clearly specify the percentages of quota share primary insurance
532	provided by the corporation and authorized insurer, and
533	conspicuously and clearly state that neither the authorized
534	insurer nor the corporation may be held responsible beyond its
535	specified percentage of coverage of hurricane losses.
536	(II)  "Eligible risks" means personal lines residential and
537	commercial lines residential risks that meet the underwriting
538	criteria of the corporation and are located in areas that were
539	eligible for coverage by the Florida Windstorm Underwriting
540	Association on January 1, 2002.
541	b.  The corporation may enter into quota share primary
542	insurance agreements with authorized insurers at corporation
543	coverage levels of 90 percent and 50 percent.
544	c.  If the corporation determines that additional coverage
545	levels are necessary to maximize participation in quota share
546	primary insurance agreements by authorized insurers, the
547	corporation may establish additional coverage levels. However,
548	the corporation's quota share primary insurance coverage level
549	may not exceed 90 percent.
550	d.  Any quota share primary insurance agreement entered
551	into between an authorized insurer and the corporation must
552	provide for a uniform specified percentage of coverage of
553	hurricane losses, by county or territory as set forth by the
554	corporation board, for all eligible risks of the authorized
555	insurer covered under the quota share primary insurance
556	agreement.
557	e.  Any quota share primary insurance agreement entered
558	into between an authorized insurer and the corporation is
559	subject to review and approval by the office. However, such
560	agreement shall be authorized only as to insurance contracts
561	entered into between an authorized insurer and an insured who is
562	already insured by the corporation for wind coverage.
563	f.  For all eligible risks covered under quota share
564	primary insurance agreements, the exposure and coverage levels
565	for both the corporation and authorized insurers shall be
566	reported by the corporation to the Florida Hurricane Catastrophe
567	Fund. For all policies of eligible risks covered under quota
568	share primary insurance agreements, the corporation and the
569	authorized insurer shall maintain complete and accurate records
570	for the purpose of exposure and loss reimbursement audits as
571	required by Florida Hurricane Catastrophe Fund rules. The
572	corporation and the authorized insurer shall each maintain
573	duplicate copies of policy declaration pages and supporting
574	claims documents.
575	g.  The corporation board shall establish in its plan of
576	operation standards for quota share agreements which ensure that
577	there is no discriminatory application among insurers as to the
578	terms of quota share agreements, pricing of quota share
579	agreements, incentive provisions if any, and consideration paid
580	for servicing policies or adjusting claims.
581	h.  The quota share primary insurance agreement between the
582	corporation and an authorized insurer must set forth the
583	specific terms under which coverage is provided, including, but
584	not limited to, the sale and servicing of policies issued under
585	the agreement by the insurance agent of the authorized insurer
586	producing the business, the reporting of information concerning
587	eligible risks, the payment of premium to the corporation, and
588	arrangements for the adjustment and payment of hurricane claims
589	incurred on eligible risks by the claims adjuster and personnel
590	of the authorized insurer. Entering into a quota sharing
591	insurance agreement between the corporation and an authorized
592	insurer shall be voluntary and at the discretion of the
593	authorized insurer.
594	3.  May provide that the corporation may employ or
595	otherwise contract with individuals or other entities to provide
596	administrative or professional services that may be appropriate
597	to effectuate the plan. The corporation shall have the power to
598	borrow funds, by issuing bonds or by incurring other
599	indebtedness, and shall have other powers reasonably necessary
600	to effectuate the requirements of this subsection, including,
601	without limitation, the power to issue bonds and incur other
602	indebtedness in order to refinance outstanding bonds or other
603	indebtedness. The corporation may, but is not required to, seek
604	judicial validation of its bonds or other indebtedness under
605	chapter 75. The corporation may issue bonds or incur other
606	indebtedness, or have bonds issued on its behalf by a unit of
607	local government pursuant to subparagraph (g)2., in the absence
608	of a hurricane or other weather-related event, upon a
609	determination by the corporation, subject to approval by the
610	office, that such action would enable it to efficiently meet the
611	financial obligations of the corporation and that such
612	financings are reasonably necessary to effectuate the
613	requirements of this subsection. The corporation is authorized
614	to take all actions needed to facilitate tax-free status for any
615	such bonds or indebtedness, including formation of trusts or
616	other affiliated entities. The corporation shall have the
617	authority to pledge assessments, projected recoveries from the
618	Florida Hurricane Catastrophe Fund, other reinsurance
619	recoverables, market equalization and other surcharges, and
620	other funds available to the corporation as security for bonds
621	or other indebtedness. In recognition of s. 10, Art. I of the
622	State Constitution, prohibiting the impairment of obligations of
623	contracts, it is the intent of the Legislature that no action be
624	taken whose purpose is to impair any bond indenture or financing
625	agreement or any revenue source committed by contract to such
626	bond or other indebtedness.
627	4.a.  Must require that the corporation operate subject to
628	the supervision and approval of a board of governors consisting
629	of nine eight individuals who are residents of this state, from
630	different geographical areas of this state. The Governor shall
631	appoint three members of the board., The Chief Financial
632	Officer, the President of the Senate, and the Speaker of the
633	House of Representatives shall each appoint two members of the
634	board. All board members shall possess demonstrated expertise or
635	knowledge in insurance, bond financing, business management or
636	corporate board membership. At least one of the two members
637	appointed by each appointing officer must have demonstrated
638	expertise in insurance. The Chief Financial Officer shall
639	designate one of the appointees as chair. All board members
640	serve at the pleasure of the appointing officer. All members of
641	the board of governors are subject to removal at will by the
642	officers who appointed them. All board members, including the
643	chair, must be appointed to serve for 3-year terms beginning
644	annually on a date designated by the plan. Any board vacancy
645	shall be filled for the unexpired term by the appointing
646	officer. The Governor shall designate one of the nine board
647	members as chair. The Chief Financial Officer shall appoint a
648	technical advisory group to provide information and advice to
649	the board of governors in connection with the board's duties
650	under this subsection. The executive director of the corporation
651	must have substantial insurance and managerial expertise and
652	senior managers of the corporation shall be engaged by the board
653	and serve at the pleasure of the board. Any executive director
654	appointed on or after July 1, 2006, is subject to confirmation
655	by the Senate. The executive director is responsible for
656	employing other staff as the corporation may require, subject to
657	review and concurrence by the board.
658	b.  The board shall create a Market Accountability Advisory
659	Committee to assist the corporation in developing awareness of
660	its rates and its customer and agent service levels in
661	relationship to the voluntary market insurers writing similar
662	coverage. The members of the advisory committee shall consist of
663	the following 11 persons, one of whom must be elected chair by
664	the members of the committee: four representatives, one
665	appointed by the Florida Association of Insurance Agents, one by
666	the Florida Association of Insurance and Financial Advisors, one
667	by the Professional Insurance Agents of Florida, and one by the
668	Latin American Association of Insurance Agencies; three
669	representatives appointed by the insurers with the three highest
670	voluntary market share of residential property insurance
671	business in the state; one representative from the Office of
672	Insurance Regulation; one consumer appointed by the board who is
673	insured by the corporation at the time of appointment to the
674	committee; one representative appointed by the Florida
675	Association of Realtors; and one representative appointed by the
676	Florida Bankers Association. All members must serve for 3-year
677	terms and may serve for consecutive terms. The committee shall
678	report to the corporation at each board meeting on insurance
679	market issues which may include rates and rate competition with
680	the voluntary market; service, including policy issuance, claims
681	processing, and general responsiveness to policyholders,
682	applicants, and agents; and matters relating to depopulation.
683	5.  Must provide a procedure for determining the
684	eligibility of a risk for coverage, as follows:
685	a.  Subject to the provisions of s. 627.3517, with respect
686	to personal lines residential risks, if the risk is offered
687	coverage from an authorized insurer at the insurer's approved
688	rate under either a standard policy including wind coverage or,
689	if consistent with the insurer's underwriting rules as filed
690	with the office, a basic policy including wind coverage, for a
691	new application to the corporation for coverage, the risk is not
692	eligible for any policy issued by the corporation unless the
693	premium for coverage from the authorized insurer is more than 25
694	percent greater than the premium for comparable coverage from
695	the corporation. If the risk is not able to obtain any such
696	offer, the risk is eligible for either a standard policy
697	including wind coverage or a basic policy including wind
698	coverage issued by the corporation; however, if the risk could
699	not be insured under a standard policy including wind coverage
700	regardless of market conditions, the risk shall be eligible for
701	a basic policy including wind coverage unless rejected under
702	subparagraph 8. However, with regard to a policyholder of the
703	corporation, the policyholder remains eligible for coverage from
704	the corporation regardless of any offer of coverage from an
705	authorized insurer or surplus lines insurer. The corporation
706	shall determine the type of policy to be provided on the basis
707	of objective standards specified in the underwriting manual and
708	based on generally accepted underwriting practices.
709	(I)  If the risk accepts an offer of coverage through the
710	market assistance plan or an offer of coverage through a
711	mechanism established by the corporation before a policy is
712	issued to the risk by the corporation or during the first 30
713	days of coverage by the corporation, and the producing agent who
714	submitted the application to the plan or to the corporation is
715	not currently appointed by the insurer, the insurer shall:
716	(A)  Pay to the producing agent of record of the policy,
717	for the first year, an amount that is the greater of the
718	insurer's usual and customary commission for the type of policy
719	written or a fee equal to the usual and customary commission of
720	the corporation; or
721	(B)  Offer to allow the producing agent of record of the
722	policy to continue servicing the policy for a period of not less
723	than 1 year and offer to pay the agent the greater of the
724	insurer's or the corporation's usual and customary commission
725	for the type of policy written.
726
727	If the producing agent is unwilling or unable to accept
728	appointment, the new insurer shall pay the agent in accordance
729	with sub-sub-sub-subparagraph (A).
730	(II)  When the corporation enters into a contractual
731	agreement for a take-out plan, the producing agent of record of
732	the corporation policy is entitled to retain any unearned
733	commission on the policy, and the insurer shall:
734	(A)  Pay to the producing agent of record of the
735	corporation policy, for the first year, an amount that is the
736	greater of the insurer's usual and customary commission for the
737	type of policy written or a fee equal to the usual and customary
738	commission of the corporation; or
739	(B)  Offer to allow the producing agent of record of the
740	corporation policy to continue servicing the policy for a period
741	of not less than 1 year and offer to pay the agent the greater
742	of the insurer's or the corporation's usual and customary
743	commission for the type of policy written.
744
745	If the producing agent is unwilling or unable to accept
746	appointment, the new insurer shall pay the agent in accordance
747	with sub-sub-sub-subparagraph (A).
748	b.  With respect to commercial lines residential risks, for
749	a new application to the corporation for coverage, if the risk
750	is offered coverage under a policy including wind coverage from
751	an authorized insurer at its approved rate, the risk is not
752	eligible for any policy issued by the corporation unless the
753	premium for coverage from the authorized insurer is more than 25
754	percent greater than the premium for comparable coverage from
755	the corporation. If the risk is not able to obtain any such
756	offer, the risk is eligible for a policy including wind coverage
757	issued by the corporation. However, with regard to a
758	policyholder of the corporation, the policyholder remains
759	eligible for coverage from the corporation regardless of any
760	offer of coverage from an authorized insurer or surplus lines
761	insurer.
762	(I)  If the risk accepts an offer of coverage through the
763	market assistance plan or an offer of coverage through a
764	mechanism established by the corporation before a policy is
765	issued to the risk by the corporation or during the first 30
766	days of coverage by the corporation, and the producing agent who
767	submitted the application to the plan or the corporation is not
768	currently appointed by the insurer, the insurer shall:
769	(A)  Pay to the producing agent of record of the policy,
770	for the first year, an amount that is the greater of the
771	insurer's usual and customary commission for the type of policy
772	written or a fee equal to the usual and customary commission of
773	the corporation; or
774	(B)  Offer to allow the producing agent of record of the
775	policy to continue servicing the policy for a period of not less
776	than 1 year and offer to pay the agent the greater of the
777	insurer's or the corporation's usual and customary commission
778	for the type of policy written.
779
780	If the producing agent is unwilling or unable to accept
781	appointment, the new insurer shall pay the agent in accordance
782	with sub-sub-sub-subparagraph (A).
783	(II)  When the corporation enters into a contractual
784	agreement for a take-out plan, the producing agent of record of
785	the corporation policy is entitled to retain any unearned
786	commission on the policy, and the insurer shall:
787	(A)  Pay to the producing agent of record of the
788	corporation policy, for the first year, an amount that is the
789	greater of the insurer's usual and customary commission for the
790	type of policy written or a fee equal to the usual and customary
791	commission of the corporation; or
792	(B)  Offer to allow the producing agent of record of the
793	corporation policy to continue servicing the policy for a period
794	of not less than 1 year and offer to pay the agent the greater
795	of the insurer's or the corporation's usual and customary
796	commission for the type of policy written.
797
798	If the producing agent is unwilling or unable to accept
799	appointment, the new insurer shall pay the agent in accordance
800	with sub-sub-sub-subparagraph (A).
801	6.  Must provide by July 1, 2007, that an application for
802	coverage for a new policy is subject to a waiting period of 10
803	days before coverage is effective, during which time the
804	corporation shall make such application available for review by
805	general lines agents and authorized property and casualty
806	insurers. The board shall approve an exception that allows for
807	coverage to be effective before the end of the 10-day waiting
808	period, for coverage issued in conjunction with a real estate
809	closing. The board may approve such other exceptions as the
810	board determines are necessary to prevent lapses in coverage.
811	7.  Must include rules for classifications of risks and
812	rates therefor.
813	8.  Must provide that if premium and investment income for
814	an account attributable to a particular calendar year are in
815	excess of projected losses and expenses for the account
816	attributable to that year, such excess shall be held in surplus
817	in the account. Such surplus shall be available to defray
818	deficits in that account as to future years and shall be used
819	for that purpose prior to assessing assessable insurers and
820	assessable insureds as to any calendar year.
821	9.  Must provide objective criteria and procedures to be
822	uniformly applied for all applicants in determining whether an
823	individual risk is so hazardous as to be uninsurable. In making
824	this determination and in establishing the criteria and
825	procedures, the following shall be considered:
826	a.  Whether the likelihood of a loss for the individual
827	risk is substantially higher than for other risks of the same
828	class; and
829	b.  Whether the uncertainty associated with the individual
830	risk is such that an appropriate premium cannot be determined.
831
832	The acceptance or rejection of a risk by the corporation shall
833	be construed as the private placement of insurance, and the
834	provisions of chapter 120 shall not apply.
835	10.  Must provide that the corporation shall make its best
836	efforts to procure catastrophe reinsurance at reasonable rates,
837	to cover its projected 100-year probable maximum loss as
838	determined by the board of governors.
839	11.  Must provide that in the event of regular deficit
840	assessments under sub-subparagraph (b)3.a. or sub-subparagraph
841	(b)3.b., in the personal lines account, the commercial lines
842	residential account, or the high-risk account, the corporation
843	shall levy upon corporation policyholders in its next rate
844	filing, or by a separate rate filing solely for this purpose, a
845	Citizens policyholder surcharge arising from a regular
846	assessment in such account in a percentage equal to the total
847	amount of such regular assessments divided by the aggregate
848	statewide direct written premium for subject lines of business
849	for the prior calendar year. For purposes of calculating the
850	Citizens policyholder surcharge to be levied under this
851	subparagraph, the total amount of the regular assessment to
852	which this surcharge is related shall be determined as set forth
853	in subparagraph (b)3., without deducting the estimated Citizens
854	policyholder surcharge. Citizens policyholder surcharges under
855	this subparagraph are not considered premium and are not subject
856	to commissions, fees, or premium taxes; however, failure to pay
857	a market equalization surcharge shall be treated as failure to
858	pay premium.
859	12.  The policies issued by the corporation must provide
860	that, if the corporation or the market assistance plan obtains
861	an offer from an authorized insurer to cover the risk at its
862	approved rates, the risk is no longer eligible for renewal
863	through the corporation, except as otherwise provided in this
864	subsection.
865	13.  Corporation policies and applications must include a
866	notice that the corporation policy could, under this section, be
867	replaced with a policy issued by an authorized insurer that does
868	not provide coverage identical to the coverage provided by the
869	corporation. The notice shall also specify that acceptance of
870	corporation coverage creates a conclusive presumption that the
871	applicant or policyholder is aware of this potential.
872	14.  May establish, subject to approval by the office,
873	different eligibility requirements and operational procedures
874	for any line or type of coverage for any specified county or
875	area if the board determines that such changes to the
876	eligibility requirements and operational procedures are
877	justified due to the voluntary market being sufficiently stable
878	and competitive in such area or for such line or type of
879	coverage and that consumers who, in good faith, are unable to
880	obtain insurance through the voluntary market through ordinary
881	methods would continue to have access to coverage from the
882	corporation. When coverage is sought in connection with a real
883	property transfer, such requirements and procedures shall not
884	provide for an effective date of coverage later than the date of
885	the closing of the transfer as established by the transferor,
886	the transferee, and, if applicable, the lender.
887	15.  Must provide that, with respect to the high-risk
888	account, any assessable insurer with a surplus as to
889	policyholders of $25 million or less writing 25 percent or more
890	of its total countrywide property insurance premiums in this
891	state may petition the office, within the first 90 days of each
892	calendar year, to qualify as a limited apportionment company. A
893	regular assessment levied by the corporation on a limited
894	apportionment company for a deficit incurred by the corporation
895	for the high-risk account in 2006 or thereafter may be paid to
896	the corporation on a monthly basis as the assessments are
897	collected by the limited apportionment company from its insureds
898	pursuant to s. 627.3512, but the regular assessment must be paid
899	in full within 12 months after being levied by the corporation.
900	A limited apportionment company shall collect from its
901	policyholders any emergency assessment imposed under sub-
902	subparagraph (b)3.d. The plan shall provide that, if the office
903	determines that any regular assessment will result in an
904	impairment of the surplus of a limited apportionment company,
905	the office may direct that all or part of such assessment be
906	deferred as provided in subparagraph (g)4. However, there shall
907	be no limitation or deferment of an emergency assessment to be
908	collected from policyholders under sub-subparagraph (b)3.d.
909	16.  Must provide that the corporation appoint as its
910	licensed agents only those agents who also hold an appointment
911	as defined in s. 626.015(3) with an insurer who at the time of
912	the agent's initial appointment by the corporation is authorized
913	to write and is actually writing personal lines residential
914	property coverage, commercial residential property coverage, or
915	commercial nonresidential property coverage within the state.
916	17.  Must provide, by July 1, 2007, a premium payment plan
917	option to its policyholders which allows for quarterly and
918	semiannual payment of premiums.
919	18.  Must provide, effective June 1, 2007, that the
920	corporation contract with each insurer providing the non-wind
921	coverage for risks insured by the corporation in the high-risk
922	account, requiring that the insurer provide claims adjusting
923	services for the wind coverage provided by the corporation for
924	such risks. An insurer is required to enter into this contract
925	as a condition of providing non-wind coverage for a risk that is
926	insured by the corporation in the high-risk account unless the
927	board finds, after a hearing, that the insurer is not capable of
928	providing adjusting services at an acceptable level of quality
929	to corporation policyholders. The terms and conditions of such
930	contracts must be substantially the same as the contracts that
931	the corporation executed with insurers under the "adjust-your-
932	own" program in 2006, except as may be mutually agreed to by the
933	parties and except for such changes that the board determines
934	are necessary to ensure that claims are adjusted appropriately.
935	The corporation shall provide a process for neutral arbitration
936	of any dispute between the corporation and the insurer regarding
937	the terms of the contract. The corporation shall review and
938	monitor the performance of insurers under these contracts.
939	19.  Must limit coverage on mobile homes or manufactured
940	homes built prior to 1994 to actual cash value of the dwelling
941	rather than replacement costs of the dwelling.
942	20.  May provide such limits of coverage as the board
943	determines, consistent with the requirements of this subsection.
944	21.  May require commercial property to meet specified
945	hurricane mitigation construction features as a condition of
946	eligibility for coverage.
947	(m)1.  Rates for coverage provided by the corporation shall
948	be actuarially sound and subject to the requirements of s.
949	627.062, except as otherwise provided in this paragraph. The
950	corporation shall file its recommended rates with the office at
951	least annually. The corporation shall provide any additional
952	information regarding the rates which the office requires. The
953	office shall consider the recommendations of the board and issue
954	a final order establishing the rates for the corporation within
955	45 days after the recommended rates are filed. The corporation
956	may not pursue an administrative challenge or judicial review of
957	the final order of the office.
958	2.  In addition to the rates otherwise determined pursuant
959	to this paragraph, the corporation shall impose and collect an
960	amount equal to the premium tax provided for in s. 624.509 to
961	augment the financial resources of the corporation.
962	3.  After the public hurricane loss-projection model under
963	s. 627.06281 has been found to be accurate and reliable by the
964	Florida Commission on Hurricane Loss Projection Methodology,
965	that model shall serve as the minimum benchmark for determining
966	the windstorm portion of the corporation's rates. This
967	subparagraph does not require or allow the corporation to adopt
968	rates lower than the rates otherwise required or allowed by this
969	paragraph.
970	4.  The rate filings for the corporation which were
971	approved by the office and which took effect January 1, 2007,
972	are rescinded, except for those rates that were lowered. As soon
973	as possible, the corporation shall begin using the lower rates
974	that were in effect on December 31, 2006, and shall provide
975	refunds to policyholders who have paid higher rates as a result
976	of that rate filing. The rates in effect on December 31, 2006,
977	shall remain in effect until January 1, 2008, for the 2007
978	calendar year except for any rate change that results in a lower
979	rate. The next rate change that may increase rates shall take
980	effect January 1, 2008, pursuant to a new rate filing
981	recommended by the corporation and established by the office,
982	subject to the requirements of this paragraph.
983	(p)1.  The corporation shall certify to the office its
984	needs for annual assessments as to a particular calendar year,
985	and for any interim assessments that it deems to be necessary to
986	sustain operations as to a particular year pending the receipt
987	of annual assessments. Upon verification, the office shall
988	approve such certification, and the corporation shall levy such
989	annual or interim assessments. Such assessments shall be
990	prorated as provided in paragraph (b). The corporation shall
991	take all reasonable and prudent steps necessary to collect the
992	amount of assessment due from each assessable insured insurer,
993	including, if prudent, filing suit to collect such assessment.
994	If the corporation is unable to collect an assessment from any
995	assessable insurer, the uncollected assessments shall be levied
996	as an additional assessment against the assessable insurers and
997	any assessable insurer required to pay an additional assessment
998	as a result of such failure to pay shall have a cause of action
999	against such nonpaying assessable insurer. Assessments shall be
1000	included as an appropriate factor in the making of rates. The
1001	failure of a surplus lines agent to collect and remit any
1002	regular or emergency assessment levied by the corporation is
1003	considered to be a violation of s. 626.936 and subjects the
1004	surplus lines agent to the penalties provided in that section.
1005	2.  The governing body of any unit of local government, any
1006	residents of which are insured by the corporation, may issue
1007	bonds as defined in s. 125.013 or s. 166.101 from time to time
1008	to fund an assistance program, in conjunction with the
1009	corporation, for the purpose of defraying deficits of the
1010	corporation. In order to avoid needless and indiscriminate
1011	proliferation, duplication, and fragmentation of such assistance
1012	programs, any unit of local government, any residents of which
1013	are insured by the corporation, may provide for the payment of
1014	losses, regardless of whether or not the losses occurred within
1015	or outside of the territorial jurisdiction of the local
1016	government. Revenue bonds under this subparagraph may not be
1017	issued until validated pursuant to chapter 75, unless a state of
1018	emergency is declared by executive order or proclamation of the
1019	Governor pursuant to s. 252.36 making such findings as are
1020	necessary to determine that it is in the best interests of, and
1021	necessary for, the protection of the public health, safety, and
1022	general welfare of residents of this state and declaring it an
1023	essential public purpose to permit certain municipalities or
1024	counties to issue such bonds as will permit relief to claimants
1025	and policyholders of the corporation. Any such unit of local
1026	government may enter into such contracts with the corporation
1027	and with any other entity created pursuant to this subsection as
1028	are necessary to carry out this paragraph. Any bonds issued
1029	under this subparagraph shall be payable from and secured by
1030	moneys received by the corporation from emergency assessments
1031	under sub-subparagraph (b)3.b.d., and assigned and pledged to or
1032	on behalf of the unit of local government for the benefit of the
1033	holders of such bonds. The funds, credit, property, and taxing
1034	power of the state or of the unit of local government shall not
1035	be pledged for the payment of such bonds. If any of the bonds
1036	remain unsold 60 days after issuance, the office shall require
1037	all insurers subject to assessment to purchase the bonds, which
1038	shall be treated as admitted assets; each insurer shall be
1039	required to purchase that percentage of the unsold portion of
1040	the bond issue that equals the insurer's relative share of
1041	assessment liability under this subsection. An insurer shall not
1042	be required to purchase the bonds to the extent that the office
1043	determines that the purchase would endanger or impair the
1044	solvency of the insurer.
1045	2. 3.a.  The corporation shall adopt one or more programs
1046	subject to approval by the office for the reduction of both new
1047	and renewal writings in the corporation. Beginning January 1,
1048	2008, any program the corporation adopts for the payment of
1049	bonuses to an insurer for each risk the insurer removes from the
1050	corporation shall comply with s. 627.3511(2) and may not exceed
1051	the amount referenced in s. 627.3511(2) for each risk removed.
1052	The corporation may consider any prudent and not unfairly
1053	discriminatory approach to reducing corporation writings, and
1054	may adopt a credit against assessment liability or other
1055	liability that provides an incentive for insurers to take risks
1056	out of the corporation and to keep risks out of the corporation
1057	by maintaining or increasing voluntary writings in counties or
1058	areas in which corporation risks are highly concentrated and a
1059	program to provide a formula under which an insurer voluntarily
1060	taking risks out of the corporation by maintaining or increasing
1061	voluntary writings will be relieved wholly or partially from
1062	assessments under sub-subparagraphs (b)3.a. and b. However, any
1063	"take-out bonus" or payment to an insurer must be conditioned on
1064	the property being insured for at least 5 years by the insurer,
1065	unless canceled or nonrenewed by the policyholder. If the policy
1066	is canceled or nonrenewed by the policyholder before the end of
1067	the 5-year period, the amount of the take-out bonus must be
1068	prorated for the time period the policy was insured. When the
1069	corporation enters into a contractual agreement for a take-out
1070	plan, the producing agent of record of the corporation policy is
1071	entitled to retain any unearned commission on such policy, and
1072	the insurer shall either:
1073	(I)  Pay to the producing agent of record of the policy,
1074	for the first year, an amount which is the greater of the
1075	insurer's usual and customary commission for the type of policy
1076	written or a policy fee equal to the usual and customary
1077	commission of the corporation; or
1078	(II)  Offer to allow the producing agent of record of the
1079	policy to continue servicing the policy for a period of not less
1080	than 1 year and offer to pay the agent the insurer's usual and
1081	customary commission for the type of policy written. If the
1082	producing agent is unwilling or unable to accept appointment by
1083	the new insurer, the new insurer shall pay the agent in
1084	accordance with sub-sub-subparagraph (I).
1085	b.  Any credit or exemption from regular assessments
1086	adopted under this subparagraph shall last no longer than the 3
1087	years following the cancellation or expiration of the policy by
1088	the corporation. With the approval of the office, the board may
1089	extend such credits for an additional year if the insurer
1090	guarantees an additional year of renewability for all policies
1091	removed from the corporation, or for 2 additional years if the
1092	insurer guarantees 2 additional years of renewability for all
1093	policies so removed.
1094	c.  There shall be no credit, limitation, exemption, or
1095	deferment from emergency assessments to be collected from
1096	policyholders pursuant to sub-subparagraph (b)3.d.
1097	4.  The plan shall provide for the deferment, in whole or
1098	in part, of the assessment of an assessable insurer, other than
1099	an emergency assessment collected from policyholders pursuant to
1100	sub-subparagraph (b)3.d., if the office finds that payment of
1101	the assessment would endanger or impair the solvency of the
1102	insurer. In the event an assessment against an assessable
1103	insurer is deferred in whole or in part, the amount by which
1104	such assessment is deferred may be assessed against the other
1105	assessable insurers in a manner consistent with the basis for
1106	assessments set forth in paragraph (b).
1107	3. 5.  Effective July 1, 2007, in order to evaluate the
1108	costs and benefits of approved take-out plans, if the
1109	corporation pays a bonus or other payment to an insurer for an
1110	approved take-out plan, it shall maintain a record of the
1111	address or such other identifying information on the property or
1112	risk removed in order to track if and when the property or risk
1113	is later insured by the corporation.
1114	4. 6.  Any policy taken out, assumed, or removed from the
1115	corporation is, as of the effective date of the take-out,
1116	assumption, or removal, direct insurance issued by the insurer
1117	and not by the corporation, even if the corporation continues to
1118	service the policies. This subparagraph applies to policies of
1119	the corporation and not policies taken out, assumed, or removed
1120	from any other entity.
1121	(r)  There shall be no liability on the part of, and no
1122	cause of action of any nature shall arise against, any
1123	assessable insurer or its agents or employees, the corporation
1124	or its agents or employees, members of the board of governors or
1125	their respective designees at a board meeting, corporation
1126	committee members, or the office or its representatives, for any
1127	action taken by them in the performance of their duties or
1128	responsibilities under this subsection. Such immunity does not
1129	apply to:
1130	1.  Any of the foregoing persons or entities for any
1131	willful tort;
1132	2.  The corporation or its producing agents for breach of
1133	any contract or agreement pertaining to insurance coverage;
1134	3.  The corporation with respect to issuance or payment of
1135	debt; or
1136	4.  Any assessable insurer with respect to any action to
1137	enforce an assessable insurer's obligations to the corporation
1138	under this subsection.
1139
1140	======= T I T L E  A M E N D M E N T =======
1141	Remove lines 18-22 and insert:
1142	and threatens the economic health of the state; revising
1143	membership of the corporation's board of governors; deleting
1144	provisions relating to assessable insurers; deleting provisions
1145	relating to who constitutes an assessable insurer; deleting
1146	provisions relating to deficit in an account; revising the
1147	definition of the term "assessments"; deleting provisions
1148	relating to subject lines of business; revising powers of the
1149	corporation to levy certain assessments; deleting provisions
1150	relating to unsold bonds; revising powers of the corporation;
1151	deleting provisions relating to credits and exemptions from
1152	assessments; revising provisions for determining eligibility for
1153	coverage under the corporation; reinstating certain rate filings
1154	by the corporation; deleting provisions relating to the
1155	uncollected assessments; deleting provisions relieving
1156	assessable insurers of liability under certain circumstances;
1157	prohibiting issuance of new

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