Amendment
Bill No. 7077

Amendment No. 695989

CHAMBER ACTION
Senate		House
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1	Representative(s) Reagan offered the following:
2
3	Amendment (with title amendment)
4	Remove everything after the enacting clause, and insert:
5	Section 1.  Paragraph (h) of subsection (7) of section
6	163.01, Florida Statutes, as amended by chapter 2007-1, Laws of
7	Florida, is amended to read:
8	163.01  Florida Interlocal Cooperation Act of 1969.--
9	(7)
10	(h)1.  Notwithstanding the provisions of paragraph (c), any
11	separate legal entity consisting of an alliance, as defined in
12	s. 395.106(2)(a), created pursuant to this paragraph and
13	controlled by and whose members consist of eligible entities
14	comprised of special districts created pursuant to a special act
15	and having the authority to own or operate one or more hospitals
16	licensed in this state or hospitals licensed in this state that
17	are owned, operated, or funded by a county or municipality, for
18	the purpose of providing property insurance coverage as defined
19	in s. 395.106(2)(b)(c), for such eligible entities, may exercise
20	all powers under this subsection in connection with borrowing
21	funds for such purposes, including, without limitation, the
22	authorization, issuance, and sale of bonds, notes, or other
23	obligations of indebtedness. Borrowed funds, including, but not
24	limited to, bonds issued by such alliance shall be deemed issued
25	on behalf of such eligible entities that enter into loan
26	agreements with such separate legal entity as provided in this
27	paragraph.
28	2.  Any such separate legal entity shall have all the
29	powers that are provided by the interlocal agreement under which
30	the entity is created or that are necessary to finance, operate,
31	or manage the alliance's property insurance coverage program.
32	Proceeds of bonds, notes, or other obligations issued by such an
33	entity may be loaned to any one or more eligible entities. Such
34	eligible entities are authorized to enter into loan agreements
35	with any separate legal entity created pursuant to this
36	paragraph for the purpose of obtaining moneys with which to
37	finance property insurance coverage or claims. Obligations of
38	any eligible entity pursuant to a loan agreement as described in
39	this paragraph may be validated as provided in chapter 75.
40	3.  Any bonds, notes, or other obligations to be issued or
41	incurred by a separate legal entity created pursuant to this
42	paragraph shall be authorized by resolution of the governing
43	body of such entity and bear the date or dates; mature at the
44	time or times, not exceeding 30 years from their respective
45	dates; bear interest at the rate or rates, which may be fixed or
46	vary at such time or times and in accordance with a specified
47	formula or method of determination; be payable at the time or
48	times; be in the denomination; be in the form; carry the
49	registration privileges; be executed in the manner; be payable
50	from the sources and in the medium of payment and at the place;
51	and be subject to redemption, including redemption prior to
52	maturity, as the resolution may provide. The bonds, notes, or
53	other obligations may be sold at public or private sale for such
54	price as the governing body of the separate legal entity shall
55	determine. The bonds may be secured by such credit enhancement,
56	if any, as the governing body of the separate legal entity deems
57	appropriate. The bonds may be secured by an indenture of trust
58	or trust agreement. In addition, the governing body of the
59	separate legal entity may delegate, to such officer or official
60	of such entity as the governing body may select, the power to
61	determine the time; manner of sale, public or private;
62	maturities; rate or rates of interest, which may be fixed or may
63	vary at such time or times and in accordance with a specified
64	formula or method of determination; and other terms and
65	conditions as may be deemed appropriate by the officer or
66	official so designated by the governing body of such separate
67	legal entity. However, the amounts and maturities of such bonds,
68	the interest rate or rates, and the purchase price of such bonds
69	shall be within the limits prescribed by the governing body of
70	such separate legal entity in its resolution delegating to such
71	officer or official the power to authorize the issuance and sale
72	of such bonds.
73	4.  Bonds issued pursuant to this paragraph may be
74	validated as provided in chapter 75. The complaint in any action
75	to validate such bonds shall be filed only in the Circuit Court
76	for Leon County. The notice required to be published by s. 75.06
77	shall be published in Leon County and in each county in which an
78	eligible entity that is a member of an alliance is located. The
79	complaint and order of the circuit court shall be served only on
80	the State Attorney of the Second Judicial Circuit and on the
81	state attorney of each circuit in each county in which an
82	eligible entity receiving bond proceeds is located.
83	5.  The accomplishment of the authorized purposes of a
84	separate legal entity created under this paragraph is deemed in
85	all respects for the benefit, increase of the commerce and
86	prosperity, and improvement of the health and living conditions
87	of the people of this state. Inasmuch as the separate legal
88	entity performs essential public functions in accomplishing its
89	purposes, the separate legal entity is not required to pay any
90	taxes or assessments of any kind upon any property acquired or
91	used by the entity for such purposes or upon any revenues at any
92	time received by the entity. The bonds, notes, and other
93	obligations of such separate legal entity, the transfer of and
94	income from such bonds, notes, and other obligations, including
95	any profits made on the sale of such bonds, notes, and other
96	obligations, are at all times free from taxation of any kind of
97	the state or by any political subdivision or other agency or
98	instrumentality of the state. The exemption granted in this
99	paragraph does not apply to any tax imposed by chapter 220 on
100	interest, income, or profits on debt obligations owned by
101	corporations.
102	6.  The participation by any eligible entity in an alliance
103	or a separate legal entity created pursuant to this paragraph
104	may not be deemed a waiver of immunity to the extent of
105	liability or any other coverage, and a contract entered
106	regarding such alliance is not required to contain any provision
107	for waiver.
108	Section 2.  Paragraph (b) of subsection (4), paragraph (e)
109	of subsection (5), paragraph (b) of subsection (6), and
110	subsection (16) of section 215.555, Florida Statutes, as amended
111	by chapter 2007-1, Laws of Florida, are amended to read:
112	215.555  Florida Hurricane Catastrophe Fund.--
113	(4)  REIMBURSEMENT CONTRACTS.--
114	(b)1.  The contract shall contain a promise by the board to
115	reimburse the insurer for 45 percent, 75 percent, or 90 percent
116	of its losses from each covered event in excess of the insurer's
117	retention, plus 5 percent of the reimbursed losses to cover loss
118	adjustment expenses.
119	2.  The insurer must elect one of the percentage coverage
120	levels specified in this paragraph and may, upon renewal of a
121	reimbursement contract, elect a lower percentage coverage level
122	if no revenue bonds issued under subsection (6) after a covered
123	event are outstanding, or elect a higher percentage coverage
124	level, regardless of whether or not revenue bonds are
125	outstanding. All members of an insurer group must elect the same
126	percentage coverage level. Any joint underwriting association,
127	risk apportionment plan, or other entity created under s.
128	627.351 must elect the 90-percent coverage level.
129	3.  The contract shall provide that reimbursement amounts
130	shall not be reduced by reinsurance paid or payable to the
131	insurer from other sources.
132	4.  Notwithstanding any other provision contained in this
133	section, the board shall make available to insurers that
134	purchased coverage provided by this subparagraph participated in
135	2006, insurers qualifying as limited apportionment companies
136	under s. 627.351(6)(c) which began writing property insurance in
137	2007, and insurers that were approved to participate in 2006 or
138	that are approved in 2007 for the Insurance Capital Build-Up
139	Incentive Program pursuant to s. 215.5595, a contract or
140	contract addendum that provides an additional amount of
141	reimbursement coverage of up to $10 million. The premium to be
142	charged for this additional reimbursement coverage shall be 50
143	percent of the additional reimbursement coverage provided, which
144	shall include one prepaid reinstatement. The minimum retention
145	level that an eligible participating insurer must retain
146	associated with this additional coverage layer is 30 percent of
147	the insurer's surplus as of December 31, 2006. This coverage
148	shall be in addition to all other coverage that may be provided
149	under this section. The coverage provided by the fund under this
150	subsection shall be in addition to the claims-paying capacity as
151	defined in subparagraph (c)1., but only with respect to those
152	insurers that select the additional coverage option and meet the
153	requirements of this subsection. The claims-paying capacity with
154	respect to all other participating insurers and limited
155	apportionment companies that do not select the additional
156	coverage option shall be limited to their reimbursement
157	premium's proportionate share of the actual claims-paying
158	capacity otherwise defined in subparagraph (c)1. and as provided
159	for under the terms of the reimbursement contract. Coverage
160	provided in the reimbursement contract will not be affected by
161	the additional premiums paid by participating insurers
162	exercising the additional coverage option allowed in this
163	subparagraph. This subparagraph expires on May 31, 2008.
164	(5)  REIMBURSEMENT PREMIUMS.--
165	(e)  If Citizens Property Insurance Corporation assumes or
166	otherwise provides coverage for policies of an insurer placed in
167	liquidation under chapter 631 pursuant to s. 627.351(6), the
168	corporation may, pursuant to conditions mutually agreed to
169	between the corporation and the State Board of Administration,
170	obtain coverage for such policies under its contract with the
171	fund or accept an assignment of the liquidated insurer's
172	contract with the fund. If Citizens Property Insurance
173	Corporation elects to cover these policies under the
174	corporation's contract with the fund, it shall notify the board
175	of its insured values with respect to such policies within a
176	specified time mutually agreed to between the corporation and
177	the board, after such assumption or other coverage transaction,
178	and the fund shall treat such policies as having been in effect
179	as of June 30 of that year. In the event of an assignment, the
180	fund shall apply that contract to such policies and treat
181	Citizens Property Insurance Corporation as if the corporation
182	were the liquidated insurer for the remaining term of the
183	contract, and the corporation shall have all rights and duties
184	of the liquidated insurer beginning on the date it provides
185	coverage for such policies, but the corporation is not subject
186	to any preexisting rights, liabilities, or duties of the
187	liquidated insurer. The assignment, including any unresolved
188	issues between the liquidated insurer and Citizens Property
189	Insurance Corporation under the contract, shall be provided for
190	in the liquidation order or otherwise determined by the court.
191	However, if a covered event occurs before the effective date of
192	the assignment, the corporation may not obtain coverage for such
193	policies under its contract with the fund and shall accept an
194	assignment of the liquidated insurer's contract as provided in
195	this paragraph. This paragraph expires on June 1, 2007.
196	(6)  REVENUE BONDS.--
197	(b)  Emergency assessments.--
198	1.  If the board determines that the amount of revenue
199	produced under subsection (5) is insufficient to fund the
200	obligations, costs, and expenses of the fund and the
201	corporation, including repayment of revenue bonds and that
202	portion of the debt service coverage not met by reimbursement
203	premiums, the board shall direct the Office of Insurance
204	Regulation to levy, by order, an emergency assessment on direct
205	premiums for all property and casualty lines of business in this
206	state, including property and casualty business of surplus lines
207	insurers regulated under part VIII of chapter 626, but not
208	including any workers' compensation premiums or medical
209	malpractice premiums. As used in this subsection, the term
210	"property and casualty business" includes all lines of business
211	identified on Form 2, Exhibit of Premiums and Losses, in the
212	annual statement required of authorized insurers by s. 624.424
213	and any rule adopted under this section, except for those lines
214	identified as accident and health insurance and except for
215	policies written under the National Flood Insurance Program. The
216	assessment shall be specified as a percentage of direct written
217	premium and is subject to annual adjustments by the board in
218	order to meet debt obligations. The same percentage shall apply
219	to all policies in lines of business subject to the assessment
220	issued or renewed during the 12-month period beginning on the
221	effective date of the assessment.
222	2.  A premium is not subject to an annual assessment under
223	this paragraph in excess of 6 percent of premium with respect to
224	obligations arising out of losses attributable to any one
225	contract year, and a premium is not subject to an aggregate
226	annual assessment under this paragraph in excess of 10 percent
227	of premium. An annual assessment under this paragraph shall
228	continue as long as the revenue bonds issued with respect to
229	which the assessment was imposed are outstanding, including any
230	bonds the proceeds of which were used to refund the revenue
231	bonds, unless adequate provision has been made for the payment
232	of the bonds under the documents authorizing issuance of the
233	bonds.
234	3.  Emergency assessments shall be collected from
235	policyholders. Emergency assessments shall be remitted by
236	insurers as a percentage of direct written premium for the
237	preceding calendar quarter as specified in the order from the
238	Office of Insurance Regulation. The office shall verify the
239	accurate and timely collection and remittance of emergency
240	assessments and shall report the information to the board in a
241	form and at a time specified by the board. Each insurer
242	collecting assessments shall provide the information with
243	respect to premiums and collections as may be required by the
244	office to enable the office to monitor and verify compliance
245	with this paragraph.
246	4.  With respect to assessments of surplus lines premiums,
247	each surplus lines agent shall collect the assessment at the
248	same time as the agent collects the surplus lines tax required
249	by s. 626.932, and the surplus lines agent shall remit the
250	assessment to the Florida Surplus Lines Service Office created
251	by s. 626.921 at the same time as the agent remits the surplus
252	lines tax to the Florida Surplus Lines Service Office. The
253	emergency assessment on each insured procuring coverage and
254	filing under s. 626.938 shall be remitted by the insured to the
255	Florida Surplus Lines Service Office at the time the insured
256	pays the surplus lines tax to the Florida Surplus Lines Service
257	Office. The Florida Surplus Lines Service Office shall remit the
258	collected assessments to the fund or corporation as provided in
259	the order levied by the Office of Insurance Regulation. The
260	Florida Surplus Lines Service Office shall verify the proper
261	application of such emergency assessments and shall assist the
262	board in ensuring the accurate and timely collection and
263	remittance of assessments as required by the board. The Florida
264	Surplus Lines Service Office shall annually calculate the
265	aggregate written premium on property and casualty business,
266	other than workers' compensation and medical malpractice,
267	procured through surplus lines agents and insureds procuring
268	coverage and filing under s. 626.938 and shall report the
269	information to the board in a form and at a time specified by
270	the board.
271	5.  Any assessment authority not used for a particular
272	contract year may be used for a subsequent contract year. If,
273	for a subsequent contract year, the board determines that the
274	amount of revenue produced under subsection (5) is insufficient
275	to fund the obligations, costs, and expenses of the fund and the
276	corporation, including repayment of revenue bonds and that
277	portion of the debt service coverage not met by reimbursement
278	premiums, the board shall direct the Office of Insurance
279	Regulation to levy an emergency assessment up to an amount not
280	exceeding the amount of unused assessment authority from a
281	previous contract year or years, plus an additional 4 percent
282	provided that the assessments in the aggregate do not exceed the
283	limits specified in subparagraph 2.
284	6.  The assessments otherwise payable to the corporation
285	under this paragraph shall be paid to the fund unless and until
286	the Office of Insurance Regulation and the Florida Surplus Lines
287	Service Office have received from the corporation and the fund a
288	notice, which shall be conclusive and upon which they may rely
289	without further inquiry, that the corporation has issued bonds
290	and the fund has no agreements in effect with local governments
291	under paragraph (c). On or after the date of the notice and
292	until the date the corporation has no bonds outstanding, the
293	fund shall have no right, title, or interest in or to the
294	assessments, except as provided in the fund's agreement with the
295	corporation.
296	7.  Emergency assessments are not premium and are not
297	subject to the premium tax, to the surplus lines tax, to any
298	fees, or to any commissions. An insurer is liable for all
299	assessments that it collects and must treat the failure of an
300	insured to pay an assessment as a failure to pay the premium. An
301	insurer is not liable for uncollectible assessments.
302	8.  When an insurer is required to return an unearned
303	premium, it shall also return any collected assessment
304	attributable to the unearned premium. A credit adjustment to the
305	collected assessment may be made by the insurer with regard to
306	future remittances that are payable to the fund or corporation,
307	but the insurer is not entitled to a refund.
308	9.  When a surplus lines insured or an insured who has
309	procured coverage and filed under s. 626.938 is entitled to the
310	return of an unearned premium, the Florida Surplus Lines Service
311	Office shall provide a credit or refund to the agent or such
312	insured for the collected assessment attributable to the
313	unearned premium prior to remitting the emergency assessment
314	collected to the fund or corporation.
315	10.  The exemption of medical malpractice insurance
316	premiums from emergency assessments under this paragraph is
317	repealed May 31, 2010 2007, and medical malpractice insurance
318	premiums shall be subject to emergency assessments attributable
319	to loss events occurring in the contract years commencing on
320	June 1, 2010 2007.
321	(16)  TEMPORARY EMERGENCY OPTIONS FOR ADDITIONAL
322	COVERAGE.--
323	(a)  Findings and intent.--
324	1.  The Legislature finds that:
325	a.  Because of temporary disruptions in the market for
326	catastrophic reinsurance, many property insurers were unable to
327	procure reinsurance for the 2006 hurricane season with an
328	attachment point below the insurers' respective Florida
329	Hurricane Catastrophe Fund attachment points, were unable to
330	procure sufficient amounts of such reinsurance, or were able to
331	procure such reinsurance only by incurring substantially higher
332	costs than in prior years.
333	b.  The reinsurance market problems were responsible, at
334	least in part, for substantial premium increases to many
335	consumers and increases in the number of policies issued by the
336	Citizens Property Insurance Corporation.
337	c.  It is likely that the reinsurance market disruptions
338	will not significantly abate prior to the 2007 hurricane season.
339	2.  It is the intent of the Legislature to create a
340	temporary emergency program, applicable to the 2007, 2008, and
341	2009 hurricane seasons, to address these market disruptions and
342	enable insurers, at their option, to procure additional coverage
343	from the Florida Hurricane Catastrophe Fund.
344	(b)  Applicability of other provisions of this
345	section.--All provisions of this section and the rules adopted
346	under this section apply to the program created by this
347	subsection unless specifically superseded by this subsection.
348	(c)  Optional coverage.--For the contract year commencing
349	June 1, 2007, and ending May 31, 2008, the contract year
350	commencing June 1, 2008, and ending May 31, 2009, and the
351	contract year commencing June 1, 2009, and ending May 31, 2010,
352	the board shall offer for each of such years the optional
353	coverage as provided in this subsection.
354	(d)  Additional definitions.--As used in this subsection,
355	the term:
356	1.  "TEACO options" means the temporary emergency
357	additional coverage options created under this subsection.
358	2.  "TEACO insurer" means an insurer that has opted to
359	obtain coverage under the TEACO options in addition to the
360	coverage provided to the insurer under its reimbursement
361	contract.
362	3.  "TEACO reimbursement premium" means the premium charged
363	by the fund for coverage provided under the TEACO options.
364	4.  "TEACO retention" means the amount of losses below
365	which a TEACO insurer is not entitled to reimbursement from the
366	fund under the TEACO option selected. A TEACO insurer's
367	retention options shall be calculated as follows:
368	a.  The board shall calculate and report to each TEACO
369	insurer the TEACO retention multiples. There shall be three
370	TEACO retention multiples for defining coverage. Each multiple
371	shall be calculated by dividing $3 billion, $4 billion, or $5
372	billion by the total estimated mandatory FHCF TEACO
373	reimbursement premium assuming all insurers selected that
374	option. Total estimated TEACO reimbursement premium for purposes
375	of the calculation under this sub-subparagraph shall be
376	calculated using the assumption that all insurers have selected
377	a specific TEACO retention multiple option and have selected the
378	90-percent coverage level.
379	b.  The TEACO retention multiples as determined under sub-
380	subparagraph a. shall be adjusted to reflect the coverage level
381	elected by the insurer. For insurers electing the 90-percent
382	coverage level, the adjusted retention multiple is 100 percent
383	of the amount determined under sub-subparagraph a. For insurers
384	electing the 75-percent coverage level, the retention multiple
385	is 120 percent of the amount determined under sub-subparagraph
386	a. For insurers electing the 45-percent coverage level, the
387	adjusted retention multiple is 200 percent of the amount
388	determined under sub-subparagraph a.
389	c.  An insurer shall determine its provisional TEACO
390	retention by multiplying its estimated mandatory FHCF
391	provisional TEACO reimbursement premium by the applicable
392	adjusted TEACO retention multiple and shall determine its actual
393	TEACO retention by multiplying its actual mandatory FHCF TEACO
394	reimbursement premium by the applicable adjusted TEACO retention
395	multiple.
396	d.  For TEACO insurers who experience multiple covered
397	events causing loss during the contract year, the insurer's full
398	TEACO retention shall be applied to each of the covered events
399	causing the two largest losses for that insurer. For other
400	covered events resulting in losses, the TEACO option does not
401	apply and the insurer's retention shall be one-third of the full
402	retention as calculated under paragraph (2)(e).
403	5.  "TEACO addendum" means an addendum to the reimbursement
404	contract reflecting the obligations of the fund and TEACO
405	insurers under the program created by this subsection.
406	6.  "FHCF" means the Florida Hurricane Catastrophe Fund.
407	(e)  TEACO addendum.--
408	1.  The TEACO addendum shall provide for reimbursement of
409	TEACO insurers for covered events occurring during the contract
410	year, in exchange for the TEACO reimbursement premium paid into
411	the fund under paragraph (f). Any insurer writing covered
412	policies has the option of choosing to accept the TEACO addendum
413	for any of the 3 contract years that the coverage is offered.
414	2.  The TEACO addendum shall contain a promise by the board
415	to reimburse the TEACO insurer for 45 percent, 75 percent, or 90
416	percent of its losses from each covered event in excess of the
417	insurer's TEACO retention, plus 5 percent of the reimbursed
418	losses to cover loss adjustment expenses. The percentage shall
419	be the same as the coverage level selected by the insurer under
420	paragraph (4)(b).
421	3.  The TEACO addendum shall provide that reimbursement
422	amounts shall not be reduced by reinsurance paid or payable to
423	the insurer from other sources.
424	4.  The TEACO addendum shall also provide that the
425	obligation of the board with respect to all TEACO addenda shall
426	not exceed an amount equal to two times the difference between
427	the industry retention level calculated under paragraph (2)(e)
428	and the $3 billion, $4 billion, or $5 billion industry TEACO
429	retention level options actually selected, but in no event may
430	the board's obligation exceed the actual claims-paying capacity
431	of the fund plus the additional capacity created in paragraph
432	(g). If the actual claims-paying capacity and the additional
433	capacity created under paragraph (g) fall short of the board's
434	obligations under the reimbursement contract, each insurer's
435	share of the fund's capacity shall be prorated based on the
436	premium an insurer pays for its mandatory normal reimbursement
437	coverage and the premium paid for its optional TEACO coverage as
438	each such premium bears to the total premiums paid to the fund
439	times the available capacity.
440	5.  The priorities, schedule, and method of reimbursements
441	under the TEACO addendum shall be the same as provided under
442	subsection (4).
443	6.  A TEACO insurer's maximum reimbursement for a single
444	event shall be equal to the product of multiplying its mandatory
445	FHCF premium by the difference between its FHCF retention
446	multiple and its TEACO retention multiple under the TEACO option
447	selected and by the coverage selected under paragraph (4)(b),
448	plus an additional 5 percent for loss adjustment expenses. A
449	TEACO insurer's maximum reimbursement under the TEACO option
450	selected for a TEACO insurer's two largest events addendum shall
451	be twice its maximum reimbursement for a single event calculated
452	by multiplying the insurer's share of the estimated total TEACO
453	reimbursement premium as calculated under sub-subparagraph
454	(d)4.a. by an amount equal to two times the difference between
455	the industry retention level calculated under paragraph (2)(e)
456	and the $3 billion, $4 billion, or $5 billion industry TEACO
457	retention level specified in sub-subparagraph (d)4.a. as
458	selected by the TEACO insurer.
459	(f)  TEACO reimbursement premiums.--
460	1.  Each TEACO insurer shall pay to the fund, in the manner
461	and at the time provided in the reimbursement contract for
462	payment of reimbursement premiums, a TEACO reimbursement premium
463	calculated as specified in this paragraph.
464	2.  The TEACO reimbursement premiums shall be calculated
465	based on the assumption that, if all insurers entering into
466	reimbursement contracts under subsection (4) also accepted the
467	TEACO option:
468	a.  The insurer's industry TEACO reimbursement premium
469	associated with the $3 billion retention option shall would be
470	equal to 85 percent of a TEACO insurer's maximum reimbursement
471	for a single event as calculated under subparagraph (e)6. the
472	difference between the industry retention level calculated under
473	paragraph (2)(e) and the $3 billion industry TEACO retention
474	level.
475	b.  The TEACO reimbursement premium associated with the $4
476	billion retention option shall would be equal to 80 percent of a
477	TEACO insurer's maximum reimbursement for a single event as
478	calculated under subparagraph (e)6. the difference between the
479	industry retention level calculated under paragraph (2)(e) and
480	the $4 billion industry TEACO retention level.
481	c.  The TEACO premium associated with the $5 billion
482	retention option shall would be equal to 75 percent of a TEACO
483	insurer's maximum reimbursement for a single event as calculated
484	under subparagraph (e)6. the difference between the industry
485	retention level calculated under paragraph (2)(e) and the $5
486	billion industry TEACO retention level.
487	3.  Each insurer's TEACO premium shall be calculated based
488	on its share of the total TEACO reimbursement premiums based on
489	its coverage selection under the TEACO addendum.
490	(g)  Effect on claims-paying capacity of the fund.--For the
491	contract term commencing June 1, 2007, the contract year
492	commencing June 1, 2008, and the contract term beginning June 1,
493	2009, the program created by this subsection shall increase the
494	claims-paying capacity of the fund as provided in subparagraph
495	(4)(c)1. by an amount equal to two times the difference between
496	the industry retention level calculated under paragraph (2)(e)
497	and the $3 billion industry TEACO retention level specified in
498	sub-subparagraph (d)4.a. The additional capacity shall apply
499	only to the additional coverage provided by the TEACO option and
500	shall not otherwise affect any insurer's reimbursement from the
501	fund.
502	Section 3.  Paragraph (b) of subsection (2) of section
503	215.5595, Florida Statutes, is amended to read:
504	215.5595  Insurance Capital Build-Up Incentive Program.--
505	(2)  The purpose of this section is to provide surplus
506	notes to new or existing authorized residential property
507	insurers under the Insurance Capital Build-Up Incentive Program
508	administered by the State Board of Administration, under the
509	following conditions:
510	(b)  The insurer must contribute an amount of new capital
511	to its surplus which is at least equal to the amount of the
512	surplus note and must apply to the board by July 1, 2006. If an
513	insurer applies after July 1, 2006, but before June 1, 2007, the
514	amount of the surplus note is limited to one-half of the new
515	capital that the insurer contributes to its surplus, except for
516	an insurer writing only manufactured housing policies, for which
517	the amount of the surplus note is equal to the amount of the new
518	capital that the insurer contributes to its surplus. For
519	purposes of this section, new capital must be in the form of
520	cash or cash equivalents as specified in s. 625.012(1).
521	Section 4.  Subsection (1) of section 624.407, Florida
522	Statutes, as amended by chapter 2007-1, Laws of Florida, is
523	amended to read:
524	624.407  Capital funds required; new insurers.--
525	(1)  To receive authority to transact any one kind or
526	combinations of kinds of insurance, as defined in part V of this
527	chapter, an insurer applying for its original certificate of
528	authority in this state after the effective date of this section
529	shall possess surplus as to policyholders not less than the
530	greater of:
531	(a)  Five million dollars for a property and casualty
532	insurer, or $2.5 million for any other insurer;
533	(b)  For life insurers, 4 percent of the insurer's total
534	liabilities;
535	(c)  For life and health insurers, 4 percent of the
536	insurer's total liabilities, plus 6 percent of the insurer's
537	liabilities relative to health insurance; or
538	(d)  For all insurers other than life insurers and life and
539	health insurers, 10 percent of the insurer's total liabilities;
540
541	however, a domestic insurer that transacts residential property
542	insurance and is a wholly owned subsidiary of an insurer
543	domiciled authorized to do business in any other state shall
544	possess surplus as to policyholders of at least $50 million, but
545	no insurer shall be required under this subsection to have
546	surplus as to policyholders greater than $100 million.
547	Section 5.  Paragraph (a) of subsection (1) of section
548	624.408, Florida Statutes, is amended to read:
549	624.408  Surplus as to policyholders required; new and
550	existing insurers.--
551	(1)(a)  To maintain a certificate of authority to transact
552	any one kind or combinations of kinds of insurance, as defined
553	in part V of this chapter, an insurer in this state shall at all
554	times maintain surplus as to policyholders not less than the
555	greater of:
556	1.  Except as provided in subparagraph 5. and paragraph
557	(b), $1.5 million;
558	2.  For life insurers, 4 percent of the insurer's total
559	liabilities;
560	3.  For life and health insurers, 4 percent of the
561	insurer's total liabilities plus 6 percent of the insurer's
562	liabilities relative to health insurance; or
563	4.  For all insurers other than mortgage guaranty insurers,
564	life insurers, and life and health insurers, 10 percent of the
565	insurer's total liabilities.
566	5.  For property and casualty insurers, $4 million;
567	however, a domestic insurer that transacts residential property
568	insurance and is a wholly owned subsidiary of an insurer
569	domiciled in any other state shall possess surplus as to
570	policyholders of at least $50 million.
571	Section 6.  Subsection (2) of section 626.9201, Florida
572	Statutes, is amended to read:
573	626.9201  Notice of cancellation or nonrenewal.--
574	(2)  An insurer issuing a policy providing coverage for
575	property, casualty, surety, or marine insurance shall give the
576	named insured written notice of cancellation or termination
577	other than nonrenewal at least 45 days prior to the effective
578	date of the cancellation or termination, including in the
579	written notice the reason or reasons for the cancellation or
580	termination, except that:
581	(a)  When cancellation is for nonpayment of premium, at
582	least 10 days' written notice of cancellation accompanied by the
583	reason therefor shall be given. As used in this paragraph, the
584	term "nonpayment of premium" means failure of the named insured
585	to discharge when due any of her or his obligations in
586	connection with the payment of premiums on a policy or any
587	installment of such premium, whether the premium is payable
588	directly to the insurer or its agent or indirectly under any
589	premium finance plan or extension of credit, or failure to
590	maintain membership in an organization if such membership is a
591	condition precedent to insurance coverage. The term "nonpayment
592	of premium" also means the failure of a financial institution to
593	honor an insurance applicant's check after delivery to a
594	licensed agent for payment of a premium, even if the agent has
595	previously delivered or transferred the premium to the insurer.
596	If a dishonored check represents the initial premium payment,
597	the contract and all contractual obligations shall be void ab
598	initio unless the nonpayment is cured within the earlier of 5
599	days after actual notice by certified mail is received by the
600	applicant or 15 days after notice is sent to the applicant by
601	certified mail or registered mail, and, if the contract is void,
602	any premium received by the insurer from a third party shall be
603	refunded to that party in full; and
604	(b)  When such cancellation or termination occurs during
605	the first 90 days during which the insurance is in force and the
606	insurance is canceled or terminated for reasons other than
607	nonpayment, at least 20 days' written notice of cancellation or
608	termination accompanied by the reason therefor shall be given
609	except where there has been a material misstatement or
610	misrepresentation or failure to comply with the underwriting
611	requirements established by the insurer.
612	Section 7.  Subsection (4) of section 627.0613, Florida
613	Statutes, as amended by chapter 2007-1, Laws of Florida, is
614	amended to read:
615	627.0613  Consumer advocate.--The Chief Financial Officer
616	must appoint a consumer advocate who must represent the general
617	public of the state before the department and the office. The
618	consumer advocate must report directly to the Chief Financial
619	Officer, but is not otherwise under the authority of the
620	department or of any employee of the department. The consumer
621	advocate has such powers as are necessary to carry out the
622	duties of the office of consumer advocate, including, but not
623	limited to, the powers to:
624	(4)  Prepare an annual report card for each authorized
625	personal residential property insurer, on a form and using a
626	letter-grade scale developed by the commission by rule, which
627	grades each insurer based on the following factors:
628	(a)  The number and nature of consumer complaints received
629	by the department against the insurer.
630	(b)  The disposition of all complaints received by the
631	department.
632	(c)  The average length of time for payment of claims by
633	the insurer.
634	(d)  Any other factors the commission identifies as
635	assisting policyholders in making informed choices about
636	homeowner's insurance.
637	Section 8.  Paragraph (a) of subsection (2) of section
638	627.062, Florida Statutes, as amended by chapter 2007-1, Laws of
639	Florida, is amended to read:
640	627.062  Rate standards.--
641	(2)  As to all such classes of insurance:
642	(a)  Insurers or rating organizations shall establish and
643	use rates, rating schedules, or rating manuals to allow the
644	insurer a reasonable rate of return on such classes of insurance
645	written in this state. A copy of rates, rating schedules, rating
646	manuals, premium credits or discount schedules, and surcharge
647	schedules, and changes thereto, shall be filed with the office
648	under one of the following procedures except as provided in
649	subparagraph 3.:
650	1.  If the filing is made at least 90 days before the
651	proposed effective date and the filing is not implemented during
652	the office's review of the filing and any proceeding and
653	judicial review, then such filing shall be considered a "file
654	and use" filing. In such case, the office shall finalize its
655	review by issuance of a notice of intent to approve or a notice
656	of intent to disapprove within 90 days after receipt of the
657	filing. The notice of intent to approve and the notice of intent
658	to disapprove constitute agency action for purposes of the
659	Administrative Procedure Act. Requests for supporting
660	information, requests for mathematical or mechanical
661	corrections, or notification to the insurer by the office of its
662	preliminary findings shall not toll the 90-day period during any
663	such proceedings and subsequent judicial review. The rate shall
664	be deemed approved if the office does not issue a notice of
665	intent to approve or a notice of intent to disapprove within 90
666	days after receipt of the filing.
667	2.  If the filing is not made in accordance with the
668	provisions of subparagraph 1., such filing shall be made as soon
669	as practicable, but no later than 30 days after the effective
670	date, and shall be considered a "use and file" filing. An
671	insurer making a "use and file" filing is potentially subject to
672	an order by the office to return to policyholders portions of
673	rates found to be excessive, as provided in paragraph (h).
674	3.  For all filings made or submitted after January 25,
675	2007, but on or before December 31, 2008, an insurer seeking a
676	rate that is greater than the rate most recently approved by the
677	office shall make a "file and use" filing. This subparagraph
678	applies to property insurance only. For purposes of this
679	subparagraph, motor vehicle collision and comprehensive
680	coverages are not considered to be property coverages.
681
682	The provisions of this subsection shall not apply to workers'
683	compensation and employer's liability insurance and to motor
684	vehicle insurance.
685	Section 9.  Section 627.0655, Florida Statutes, as created
686	by chapter 2007-1, Laws of Florida, is amended to read:
687	627.0655  Policyholder loss or expense-related premium
688	discounts.--An insurer or person authorized to engage in the
689	business of insurance in this state may include, in the premium
690	charged an insured for any policy, contract, or certificate of
691	insurance, a discount based on the fact that another policy,
692	contract, or certificate of any type has been purchased by the
693	insured from the same insurer or insurer group.
694	Section 10.  Paragraphs (a), (b), (c), (d), (j), (m), (n),
695	and (v) of subsection (6) of section 627.351, Florida Statutes,
696	as amended by chapter 2007-1, Laws of Florida, are amended to
697	read:
698	627.351  Insurance risk apportionment plans.--
699	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
700	(a)1.  It is the public purpose of this subsection to
701	ensure the existence of an orderly market for property insurance
702	for Florida's residents and businesses. The Legislature finds
703	that actual and threatened catastrophic losses to property in
704	this state from hurricanes have caused insurers are to be
705	unwilling or unable to provide affordable property insurance
706	coverage in this state to the extent sought and needed. The
707	absence of affordable property insurance threatens the public
708	health, safety, and welfare and likewise threatens the economic
709	health of this state. The state therefore has a compelling It is
710	in the public interest and a public purpose to assist in
711	assuring that property in the state is insured so as to
712	facilitate the remediation, reconstruction, and replacement of
713	damaged or destroyed property in order to reduce or avoid the
714	negative effects otherwise resulting to the public health,
715	safety, and welfare; to the economy of the state; and to the
716	revenues of the state and local governments needed to provide
717	for the public welfare. It is necessary, therefore, to provide
718	property insurance to applicants who are in good faith entitled
719	to procure insurance through the voluntary market but are unable
720	to do so. The Legislature intends by this subsection that
721	property insurance be provided and that it continues to be
722	provided, as long as necessary, through Citizens Property
723	Insurance Corporation, a government entity that is an integral
724	part of the state and that is not a private insurance company.
725	To that end, the corporation shall strive an entity organized to
726	achieve efficiencies and economies, while providing service to
727	policyholders, applicants, and agents that is no less than the
728	quality generally provided in the voluntary market, for all
729	toward the achievement of the foregoing public purposes. Because
730	it is essential for such government entity the corporation to
731	have the maximum financial resources to pay claims following a
732	catastrophic hurricane, it is the intent of the Legislature that
733	Citizens Property Insurance Corporation continues to be an
734	integral part of this state and that the income of the
735	corporation be exempt from federal income taxation and that
736	interest on the debt obligations issued by the corporation be
737	exempt from federal income taxation.
738	2.  The Residential Property and Casualty Joint
739	Underwriting Association originally created by this statute
740	shall be known, as of July 1, 2002, as the Citizens Property
741	Insurance Corporation. The corporation shall provide insurance
742	for residential and commercial property, for applicants who are
743	in good faith entitled, but are unable, to procure insurance
744	through the voluntary market. The corporation shall operate
745	pursuant to a plan of operation approved by order of the
746	Financial Services Commission. The plan is subject to continuous
747	review by the commission. The commission may, by order, withdraw
748	approval of all or part of a plan if the commission determines
749	that conditions have changed since approval was granted and that
750	the purposes of the plan require changes in the plan. The
751	corporation shall continue to operate pursuant to the plan of
752	operation approved by the Office of Insurance Regulation until
753	October 1, 2006. For the purposes of this subsection,
754	residential coverage includes both personal lines residential
755	coverage, which consists of the type of coverage provided by
756	homeowner's, mobile home owner's, dwelling, tenant's,
757	condominium unit owner's, and similar policies, and commercial
758	lines residential coverage, which consists of the type of
759	coverage provided by condominium association, apartment
760	building, and similar policies.
761	3.  For the purposes of this subsection, the term
762	"homestead property" means:
763	a.  Property that has been granted a homestead exemption
764	under chapter 196;
765	b.  Property for which the owner has a current, written
766	lease with a renter for a term of at least 7 months and for
767	which the dwelling is insured by the corporation for $200,000 or
768	less;
769	c.  An owner-occupied mobile home or manufactured home, as
770	defined in s. 320.01, which is permanently affixed to real
771	property, is owned by a Florida resident, and has been granted a
772	homestead exemption under chapter 196 or, if the owner does not
773	own the real property, the owner certifies that the mobile home
774	or manufactured home is his or her principal place of residence;
775	d.  Tenant's coverage;
776	e.  Commercial lines residential property; or
777	f.  Any county, district, or municipal hospital; a hospital
778	licensed by any not-for-profit corporation qualified under s.
779	501(c)(3) of the United States Internal Revenue Code; or a
780	continuing care retirement community that is certified under
781	chapter 651 and that receives an exemption from ad valorem taxes
782	under chapter 196.
783	4.  For the purposes of this subsection, the term
784	"nonhomestead property" means property that is not homestead
785	property.
786	5.  Effective July 1, 2008, a personal lines residential
787	structure that has a dwelling replacement cost of $1 million or
788	more, or a single condominium unit that has a combined dwelling
789	and content replacement cost of $1 million or more is not
790	eligible for coverage by the corporation. Such dwellings insured
791	by the corporation on June 30, 2008, may continue to be covered
792	by the corporation until the end of the policy term. However,
793	such dwellings that are insured by the corporation and become
794	ineligible for coverage due to the provisions of this
795	subparagraph may reapply and obtain coverage in the high-risk
796	account and be considered "nonhomestead property" if the
797	property owner provides the corporation with a sworn affidavit
798	from one or more insurance agents, on a form provided by the
799	corporation, stating that the agents have made their best
800	efforts to obtain coverage and that the property has been
801	rejected for coverage by at least one authorized insurer and at
802	least three surplus lines insurers. If such conditions are met,
803	the dwelling may be insured by the corporation for up to 3
804	years, after which time the dwelling is ineligible for coverage.
805	The office shall approve the method used by the corporation for
806	valuing the dwelling replacement cost for the purposes of this
807	subparagraph. If a policyholder is insured by the corporation
808	prior to being determined to be ineligible pursuant to this
809	subparagraph and such policyholder files a lawsuit challenging
810	the determination, the policyholder may remain insured by the
811	corporation until the conclusion of the litigation.
812	6.  For properties constructed on or after January 1, 2009,
813	the corporation may not insure any property located within 2,500
814	feet landward of the coastal construction control line created
815	pursuant to s. 161.053 unless the property meets the
816	requirements of the code-plus building standards developed by
817	the Florida Building Commission.
818	7.  It is the intent of the Legislature that policyholders,
819	applicants, and agents of the corporation receive service and
820	treatment of the highest possible level but never less than that
821	generally provided in the voluntary market. It also is intended
822	that the corporation be held to service standards no less than
823	those applied to insurers in the voluntary market by the office
824	with respect to responsiveness, timeliness, customer courtesy,
825	and overall dealings with policyholders, applicants, or agents
826	of the corporation.
827	(b)1.  All insurers authorized to write one or more subject
828	lines of business in this state are subject to assessment by the
829	corporation and, for the purposes of this subsection, are
830	referred to collectively as "assessable insurers." Insurers
831	writing one or more subject lines of business in this state
832	pursuant to part VIII of chapter 626 are not assessable
833	insurers, but insureds who procure one or more subject lines of
834	business in this state pursuant to part VIII of chapter 626 are
835	subject to assessment by the corporation and are referred to
836	collectively as "assessable insureds." An authorized insurer's
837	assessment liability shall begin on the first day of the
838	calendar year following the year in which the insurer was issued
839	a certificate of authority to transact insurance for subject
840	lines of business in this state and shall terminate 1 year after
841	the end of the first calendar year during which the insurer no
842	longer holds a certificate of authority to transact insurance
843	for subject lines of business in this state.
844	2.a.  All revenues, assets, liabilities, losses, and
845	expenses of the corporation shall be divided into three separate
846	accounts as follows:
847	(I)  A personal lines account for personal residential
848	policies issued by the corporation or issued by the Residential
849	Property and Casualty Joint Underwriting Association and renewed
850	by the corporation that provide comprehensive, multiperil
851	coverage on risks that are not located in areas eligible for
852	coverage in the Florida Windstorm Underwriting Association as
853	those areas were defined on January 1, 2002, and for such
854	policies that do not provide coverage for the peril of wind on
855	risks that are located in such areas;
856	(II)  A commercial lines account for commercial residential
857	and commercial nonresidential policies issued by the corporation
858	or issued by the Residential Property and Casualty Joint
859	Underwriting Association and renewed by the corporation that
860	provide coverage for basic property perils on risks that are not
861	located in areas eligible for coverage in the Florida Windstorm
862	Underwriting Association as those areas were defined on January
863	1, 2002, and for such policies that do not provide coverage for
864	the peril of wind on risks that are located in such areas; and
865	(III)  A high-risk account for personal residential
866	policies and commercial residential and commercial
867	nonresidential property policies issued by the corporation or
868	transferred to the corporation that provide coverage for the
869	peril of wind on risks that are located in areas eligible for
870	coverage in the Florida Windstorm Underwriting Association as
871	those areas were defined on January 1, 2002. Subject to the
872	approval of a business plan by the Financial Services Commission
873	and Legislative Budget Commission as provided in this sub-sub-
874	subparagraph, but no earlier than March 31, 2007, the
875	corporation may offer policies that provide multiperil coverage
876	and the corporation shall continue to offer policies that
877	provide coverage only for the peril of wind for risks located in
878	areas eligible for coverage in the high-risk account. In issuing
879	multiperil coverage, the corporation may use its approved policy
880	forms and rates for the personal lines account. An applicant or
881	insured who is eligible to purchase a multiperil policy from the
882	corporation may purchase a multiperil policy from an authorized
883	insurer without prejudice to the applicant's or insured's
884	eligibility to prospectively purchase a policy that provides
885	coverage only for the peril of wind from the corporation. An
886	applicant or insured who is eligible for a corporation policy
887	that provides coverage only for the peril of wind may elect to
888	purchase or retain such policy and also purchase or retain
889	coverage excluding wind from an authorized insurer without
890	prejudice to the applicant's or insured's eligibility to
891	prospectively purchase a policy that provides multiperil
892	coverage from the corporation. It is the goal of the Legislature
893	that there would be an overall average savings of 10 percent or
894	more for a policyholder who currently has a wind-only policy
895	with the corporation, and an ex-wind policy with a voluntary
896	insurer or the corporation, and who then obtains a multiperil
897	policy from the corporation. It is the intent of the Legislature
898	that the offer of multiperil coverage in the high-risk account
899	be made and implemented in a manner that does not adversely
900	affect the tax-exempt status of the corporation or
901	creditworthiness of or security for currently outstanding
902	financing obligations or credit facilities of the high-risk
903	account, the personal lines account, or the commercial lines
904	account. By March 1, 2007, the corporation shall prepare and
905	submit for approval by the Financial Services Commission and
906	Legislative Budget Commission a report detailing the
907	corporation's business plan for issuing multiperil coverage in
908	the high-risk account. The business plan shall be approved or
909	disapproved within 30 days after receipt, as submitted or
910	modified and resubmitted by the corporation. The business plan
911	must include: the impact of such multiperil coverage on the
912	corporation's financial resources, the impact of such multiperil
913	coverage on the corporation's tax-exempt status, the manner in
914	which the corporation plans to implement the processing of
915	applications and policy forms for new and existing
916	policyholders, the impact of such multiperil coverage on the
917	corporation's ability to deliver customer service at the high
918	level required by this subsection, the ability of the
919	corporation to process claims, the ability of the corporation to
920	quote and issue policies, the impact of such multiperil coverage
921	on the corporation's agents, the impact of such multiperil
922	coverage on the corporation's existing policyholders, and the
923	impact of such multiperil coverage on rates and premium. The
924	high-risk account must also include quota share primary
925	insurance under subparagraph (c)2. The area eligible for
926	coverage under the high-risk account also includes the area
927	within Port Canaveral, which is bordered on the south by the
928	City of Cape Canaveral, bordered on the west by the Banana
929	River, and bordered on the north by Federal Government property.
930	b.  The three separate accounts must be maintained as long
931	as financing obligations entered into by the Florida Windstorm
932	Underwriting Association or Residential Property and Casualty
933	Joint Underwriting Association are outstanding, in accordance
934	with the terms of the corresponding financing documents. When
935	the financing obligations are no longer outstanding, in
936	accordance with the terms of the corresponding financing
937	documents, the corporation may use a single account for all
938	revenues, assets, liabilities, losses, and expenses of the
939	corporation. Consistent with the requirement of this
940	subparagraph and prudent investment policies that minimize the
941	cost of carrying debt, the board shall exercise its best efforts
942	to retire existing debt or to obtain approval of necessary
943	parties to amend the terms of existing debt, so as to structure
944	the most efficient plan to consolidate the three separate
945	accounts into a single account. By February 1, 2007, the board
946	shall submit a report to the Financial Services Commission, the
947	President of the Senate, and the Speaker of the House of
948	Representatives which includes an analysis of consolidating the
949	accounts, the actions the board has taken to minimize the cost
950	of carrying debt, and its recommendations for executing the most
951	efficient plan.
952	c.  Creditors of the Residential Property and Casualty
953	Joint Underwriting Association shall have a claim against, and
954	recourse to, the accounts referred to in sub-sub-subparagraphs
955	a.(I) and (II) and shall have no claim against, or recourse to,
956	the account referred to in sub-sub-subparagraph a.(III).
957	Creditors of the Florida Windstorm Underwriting Association
958	shall have a claim against, and recourse to, the account
959	referred to in sub-sub-subparagraph a.(III) and shall have no
960	claim against, or recourse to, the accounts referred to in sub-
961	sub-subparagraphs a.(I) and (II).
962	d.  Revenues, assets, liabilities, losses, and expenses not
963	attributable to particular accounts shall be prorated among the
964	accounts.
965	e.  The Legislature finds that the revenues of the
966	corporation are revenues that are necessary to meet the
967	requirements set forth in documents authorizing the issuance of
968	bonds under this subsection.
969	f.  No part of the income of the corporation may inure to
970	the benefit of any private person.
971	3.  With respect to a deficit in an account:
972	a.  When the deficit incurred in a particular calendar year
973	is not greater than 10 percent of the aggregate statewide direct
974	written premium for the subject lines of business for the prior
975	calendar year, the entire deficit shall be recovered through
976	regular assessments of assessable insurers under paragraph (p)
977	and assessable insureds.
978	b.  When the deficit incurred in a particular calendar year
979	exceeds 10 percent of the aggregate statewide direct written
980	premium for the subject lines of business for the prior calendar
981	year, the corporation shall levy regular assessments on
982	assessable insurers under paragraph (p) and on assessable
983	insureds in an amount equal to the greater of 10 percent of the
984	deficit or 10 percent of the aggregate statewide direct written
985	premium for the subject lines of business for the prior calendar
986	year. Any remaining deficit shall be recovered through emergency
987	assessments under sub-subparagraph d.
988	c.  Each assessable insurer's share of the amount being
989	assessed under sub-subparagraph a. or sub-subparagraph b. shall
990	be in the proportion that the assessable insurer's direct
991	written premium for the subject lines of business for the year
992	preceding the assessment bears to the aggregate statewide direct
993	written premium for the subject lines of business for that year.
994	The assessment percentage applicable to each assessable insured
995	is the ratio of the amount being assessed under sub-subparagraph
996	a. or sub-subparagraph b. to the aggregate statewide direct
997	written premium for the subject lines of business for the prior
998	year. Assessments levied by the corporation on assessable
999	insurers under sub-subparagraphs a. and b. shall be paid as
1000	required by the corporation's plan of operation and paragraph
1001	(p). Notwithstanding any other provision of this subsection, the
1002	aggregate amount of a regular assessment for a deficit incurred
1003	in a particular calendar year shall be reduced by the estimated
1004	amount to be received by the corporation from the Citizens
1005	policyholder surcharge under subparagraph (c)10.11. and the
1006	amount collected or estimated to be collected from the
1007	assessment on Citizens policyholders pursuant to sub-
1008	subparagraph i. Assessments levied by the corporation on
1009	assessable insureds under sub-subparagraphs a. and b. shall be
1010	collected by the surplus lines agent at the time the surplus
1011	lines agent collects the surplus lines tax required by s.
1012	626.932 and shall be paid to the Florida Surplus Lines Service
1013	Office at the time the surplus lines agent pays the surplus
1014	lines tax to the Florida Surplus Lines Service Office. Upon
1015	receipt of regular assessments from surplus lines agents, the
1016	Florida Surplus Lines Service Office shall transfer the
1017	assessments directly to the corporation as determined by the
1018	corporation.
1019	d.  Upon a determination by the board of governors that a
1020	deficit in an account exceeds the amount that will be recovered
1021	through regular assessments under sub-subparagraph a. or sub-
1022	subparagraph b., the board shall levy, after verification by the
1023	office, emergency assessments, for as many years as necessary to
1024	cover the deficits, to be collected by assessable insurers and
1025	the corporation and collected from assessable insureds upon
1026	issuance or renewal of policies for subject lines of business,
1027	excluding National Flood Insurance policies. The amount of the
1028	emergency assessment collected in a particular year shall be a
1029	uniform percentage of that year's direct written premium for
1030	subject lines of business and all accounts of the corporation,
1031	excluding National Flood Insurance Program policy premiums, as
1032	annually determined by the board and verified by the office. The
1033	office shall verify the arithmetic calculations involved in the
1034	board's determination within 30 days after receipt of the
1035	information on which the determination was based.
1036	Notwithstanding any other provision of law, the corporation and
1037	each assessable insurer that writes subject lines of business
1038	shall collect emergency assessments from its policyholders
1039	without such obligation being affected by any credit,
1040	limitation, exemption, or deferment. Emergency assessments
1041	levied by the corporation on assessable insureds shall be
1042	collected by the surplus lines agent at the time the surplus
1043	lines agent collects the surplus lines tax required by s.
1044	626.932 and shall be paid to the Florida Surplus Lines Service
1045	Office at the time the surplus lines agent pays the surplus
1046	lines tax to the Florida Surplus Lines Service Office. The
1047	emergency assessments so collected shall be transferred directly
1048	to the corporation on a periodic basis as determined by the
1049	corporation and shall be held by the corporation solely in the
1050	applicable account. The aggregate amount of emergency
1051	assessments levied for an account under this sub-subparagraph in
1052	any calendar year may not exceed the greater of 10 percent of
1053	the amount needed to cover the original deficit, plus interest,
1054	fees, commissions, required reserves, and other costs associated
1055	with financing of the original deficit, or 10 percent of the
1056	aggregate statewide direct written premium for subject lines of
1057	business and for all accounts of the corporation for the prior
1058	year, plus interest, fees, commissions, required reserves, and
1059	other costs associated with financing the original deficit.
1060	e.  The corporation may pledge the proceeds of assessments,
1061	projected recoveries from the Florida Hurricane Catastrophe
1062	Fund, other insurance and reinsurance recoverables, policyholder
1063	surcharges and other surcharges, and other funds available to
1064	the corporation as the source of revenue for and to secure bonds
1065	issued under paragraph (p), bonds or other indebtedness issued
1066	under subparagraph (c)3., or lines of credit or other financing
1067	mechanisms issued or created under this subsection, or to retire
1068	any other debt incurred as a result of deficits or events giving
1069	rise to deficits, or in any other way that the board determines
1070	will efficiently recover such deficits. The purpose of the lines
1071	of credit or other financing mechanisms is to provide additional
1072	resources to assist the corporation in covering claims and
1073	expenses attributable to a catastrophe. As used in this
1074	subsection, the term "assessments" includes regular assessments
1075	under sub-subparagraph a., sub-subparagraph b., or subparagraph
1076	(p)1. and emergency assessments under sub-subparagraph d.
1077	Emergency assessments collected under sub-subparagraph d. are
1078	not part of an insurer's rates, are not premium, and are not
1079	subject to premium tax, fees, or commissions; however, failure
1080	to pay the emergency assessment shall be treated as failure to
1081	pay premium. The emergency assessments under sub-subparagraph d.
1082	shall continue as long as any bonds issued or other indebtedness
1083	incurred with respect to a deficit for which the assessment was
1084	imposed remain outstanding, unless adequate provision has been
1085	made for the payment of such bonds or other indebtedness
1086	pursuant to the documents governing such bonds or other
1087	indebtedness.
1088	f.  As used in this subsection for purposes of any deficit
1089	incurred on or after January 25, 2007, the term "subject lines
1090	of business" means insurance written by assessable insurers or
1091	procured by assessable insureds for all property and casualty
1092	lines of business in this state, but not including workers'
1093	compensation or medical malpractice. As used in the sub-
1094	subparagraph, the term "property and casualty lines of business"
1095	includes all lines of business identified on Form 2, Exhibit of
1096	Premiums and Losses, in the annual statement required of
1097	authorized insurers by s. 624.424 and any rule adopted under
1098	this section, except for those lines identified as accident and
1099	health insurance and except for policies written under the
1100	National Flood Insurance Program or the Federal Crop Insurance
1101	Program. For purposes of this sub-subparagraph, the term
1102	"workers' compensation" includes both workers' compensation
1103	insurance and excess workers' compensation insurance.
1104	g.  The Florida Surplus Lines Service Office shall
1105	determine annually the aggregate statewide written premium in
1106	subject lines of business procured by assessable insureds and
1107	shall report that information to the corporation in a form and
1108	at a time the corporation specifies to ensure that the
1109	corporation can meet the requirements of this subsection and the
1110	corporation's financing obligations.
1111	h.  The Florida Surplus Lines Service Office shall verify
1112	the proper application by surplus lines agents of assessment
1113	percentages for regular assessments and emergency assessments
1114	levied under this subparagraph on assessable insureds and shall
1115	assist the corporation in ensuring the accurate, timely
1116	collection and payment of assessments by surplus lines agents as
1117	required by the corporation.
1118	i.  If a deficit is incurred in any account in 2008 or
1119	thereafter, the board of governors shall levy an immediate
1120	assessment against the premium of each nonhomestead property
1121	policyholder in all accounts of the corporation, as a uniform
1122	percentage of the premium of the policy of up to 10 percent of
1123	such premium, which funds shall be used to offset the deficit.
1124	If this assessment is insufficient to eliminate the deficit, the
1125	board of governors shall levy an additional assessment against
1126	all policyholders of the corporation, which shall be collected
1127	at the time of issuance or renewal of a policy, as a uniform
1128	percentage of the premium for the policy of up to 10 percent of
1129	such premium, which funds shall be used to further offset the
1130	deficit.
1131	j.  The board of governors shall maintain separate
1132	accounting records that consolidate data for nonhomestead
1133	properties, including, but not limited to, number of policies,
1134	insured values, premiums written, and losses. The board of
1135	governors shall annually report to the office and the
1136	Legislature a summary of such data.
1137	(c)  The plan of operation of the corporation:
1138	1.  Must provide for adoption of residential property and
1139	casualty insurance policy forms and commercial residential and
1140	nonresidential property insurance forms, which forms must be
1141	approved by the office prior to use. The corporation shall adopt
1142	the following policy forms:
1143	a.  Standard personal lines policy forms that are
1144	comprehensive multiperil policies providing full coverage of a
1145	residential property equivalent to the coverage provided in the
1146	private insurance market under an HO-3, HO-4, or HO-6 policy.
1147	b.  Basic personal lines policy forms that are policies
1148	similar to an HO-8 policy or a dwelling fire policy that provide
1149	coverage meeting the requirements of the secondary mortgage
1150	market, but which coverage is more limited than the coverage
1151	under a standard policy.
1152	c.  Commercial lines residential and nonresidential policy
1153	forms that are generally similar to the basic perils of full
1154	coverage obtainable for commercial residential structures and
1155	commercial nonresidential structures in the admitted voluntary
1156	market.
1157	d.  Personal lines and commercial lines residential
1158	property insurance forms that cover the peril of wind only. The
1159	forms are applicable only to residential properties located in
1160	areas eligible for coverage under the high-risk account referred
1161	to in sub-subparagraph (b)2.a.
1162	e.  Commercial lines nonresidential property insurance
1163	forms that cover the peril of wind only. The forms are
1164	applicable only to nonresidential properties located in areas
1165	eligible for coverage under the high-risk account referred to in
1166	sub-subparagraph (b)2.a.
1167	f.  The corporation may adopt variations of the policy
1168	forms listed in sub-subparagraphs a.-e. that contain more
1169	restrictive coverage.
1170	2.a.  Must provide that the corporation adopt a program in
1171	which the corporation and authorized insurers enter into quota
1172	share primary insurance agreements for hurricane coverage, as
1173	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1174	property insurance forms for eligible risks which cover the
1175	peril of wind only. As used in this subsection, the term:
1176	(I)  "Quota share primary insurance" means an arrangement
1177	in which the primary hurricane coverage of an eligible risk is
1178	provided in specified percentages by the corporation and an
1179	authorized insurer. The corporation and authorized insurer are
1180	each solely responsible for a specified percentage of hurricane
1181	coverage of an eligible risk as set forth in a quota share
1182	primary insurance agreement between the corporation and an
1183	authorized insurer and the insurance contract. The
1184	responsibility of the corporation or authorized insurer to pay
1185	its specified percentage of hurricane losses of an eligible
1186	risk, as set forth in the quota share primary insurance
1187	agreement, may not be altered by the inability of the other
1188	party to the agreement to pay its specified percentage of
1189	hurricane losses. Eligible risks that are provided hurricane
1190	coverage through a quota share primary insurance arrangement
1191	must be provided policy forms that set forth the obligations of
1192	the corporation and authorized insurer under the arrangement,
1193	clearly specify the percentages of quota share primary insurance
1194	provided by the corporation and authorized insurer, and
1195	conspicuously and clearly state that neither the authorized
1196	insurer nor the corporation may be held responsible beyond its
1197	specified percentage of coverage of hurricane losses.
1198	(II)  "Eligible risks" means personal lines residential and
1199	commercial lines residential risks that meet the underwriting
1200	criteria of the corporation and are located in areas that were
1201	eligible for coverage by the Florida Windstorm Underwriting
1202	Association on January 1, 2002.
1203	b.  The corporation may enter into quota share primary
1204	insurance agreements with authorized insurers at corporation
1205	coverage levels of 90 percent and 50 percent.
1206	c.  If the corporation determines that additional coverage
1207	levels are necessary to maximize participation in quota share
1208	primary insurance agreements by authorized insurers, the
1209	corporation may establish additional coverage levels. However,
1210	the corporation's quota share primary insurance coverage level
1211	may not exceed 90 percent.
1212	d.  Any quota share primary insurance agreement entered
1213	into between an authorized insurer and the corporation must
1214	provide for a uniform specified percentage of coverage of
1215	hurricane losses, by county or territory as set forth by the
1216	corporation board, for all eligible risks of the authorized
1217	insurer covered under the quota share primary insurance
1218	agreement.
1219	e.  Any quota share primary insurance agreement entered
1220	into between an authorized insurer and the corporation is
1221	subject to review and approval by the office. However, such
1222	agreement shall be authorized only as to insurance contracts
1223	entered into between an authorized insurer and an insured who is
1224	already insured by the corporation for wind coverage.
1225	f.  For all eligible risks covered under quota share
1226	primary insurance agreements, the exposure and coverage levels
1227	for both the corporation and authorized insurers shall be
1228	reported by the corporation to the Florida Hurricane Catastrophe
1229	Fund. For all policies of eligible risks covered under quota
1230	share primary insurance agreements, the corporation and the
1231	authorized insurer shall maintain complete and accurate records
1232	for the purpose of exposure and loss reimbursement audits as
1233	required by Florida Hurricane Catastrophe Fund rules. The
1234	corporation and the authorized insurer shall each maintain
1235	duplicate copies of policy declaration pages and supporting
1236	claims documents.
1237	g.  The corporation board shall establish in its plan of
1238	operation standards for quota share agreements which ensure that
1239	there is no discriminatory application among insurers as to the
1240	terms of quota share agreements, pricing of quota share
1241	agreements, incentive provisions if any, and consideration paid
1242	for servicing policies or adjusting claims.
1243	h.  The quota share primary insurance agreement between the
1244	corporation and an authorized insurer must set forth the
1245	specific terms under which coverage is provided, including, but
1246	not limited to, the sale and servicing of policies issued under
1247	the agreement by the insurance agent of the authorized insurer
1248	producing the business, the reporting of information concerning
1249	eligible risks, the payment of premium to the corporation, and
1250	arrangements for the adjustment and payment of hurricane claims
1251	incurred on eligible risks by the claims adjuster and personnel
1252	of the authorized insurer. Entering into a quota sharing
1253	insurance agreement between the corporation and an authorized
1254	insurer shall be voluntary and at the discretion of the
1255	authorized insurer.
1256	3.  May provide that the corporation may employ or
1257	otherwise contract with individuals or other entities to provide
1258	administrative or professional services that may be appropriate
1259	to effectuate the plan. The corporation shall have the power to
1260	borrow funds, by issuing bonds or by incurring other
1261	indebtedness, and shall have other powers reasonably necessary
1262	to effectuate the requirements of this subsection, including,
1263	without limitation, the power to issue bonds and incur other
1264	indebtedness in order to refinance outstanding bonds or other
1265	indebtedness. The corporation may, but is not required to, seek
1266	judicial validation of its bonds or other indebtedness under
1267	chapter 75. The corporation may issue bonds or incur other
1268	indebtedness, or have bonds issued on its behalf by a unit of
1269	local government pursuant to subparagraph (g)2., in the absence
1270	of a hurricane or other weather-related event, upon a
1271	determination by the corporation, subject to approval by the
1272	office, that such action would enable it to efficiently meet the
1273	financial obligations of the corporation and that such
1274	financings are reasonably necessary to effectuate the
1275	requirements of this subsection. The corporation is authorized
1276	to take all actions needed to facilitate tax-free status for any
1277	such bonds or indebtedness, including formation of trusts or
1278	other affiliated entities. The corporation shall have the
1279	authority to pledge assessments, projected recoveries from the
1280	Florida Hurricane Catastrophe Fund, other reinsurance
1281	recoverables, market equalization and other surcharges, and
1282	other funds available to the corporation as security for bonds
1283	or other indebtedness. In recognition of s. 10, Art. I of the
1284	State Constitution, prohibiting the impairment of obligations of
1285	contracts, it is the intent of the Legislature that no action be
1286	taken whose purpose is to impair any bond indenture or financing
1287	agreement or any revenue source committed by contract to such
1288	bond or other indebtedness.
1289	4.a.  Must require that the corporation operate subject to
1290	the supervision and approval of a board of governors consisting
1291	of eight individuals who are residents of this state, from
1292	different geographical areas of this state. The Governor, the
1293	Chief Financial Officer, the President of the Senate, and the
1294	Speaker of the House of Representatives shall each appoint two
1295	members of the board. At least one of the two members appointed
1296	by each appointing officer must have demonstrated expertise in
1297	insurance. The Chief Financial Officer shall designate one of
1298	the appointees as chair. All board members serve at the pleasure
1299	of the appointing officer. All members of the board of governors
1300	are subject to removal at will by the officers who appointed
1301	them. All board members, including the chair, must be appointed
1302	to serve for 3-year terms beginning annually on a date
1303	designated by the plan. Any board vacancy shall be filled for
1304	the unexpired term by the appointing officer. The Chief
1305	Financial Officer shall appoint a technical advisory group to
1306	provide information and advice to the board of governors in
1307	connection with the board's duties under this subsection. The
1308	executive director and senior managers of the corporation shall
1309	be engaged by the board and serve at the pleasure of the board.
1310	Any executive director appointed on or after July 1, 2006, is
1311	subject to confirmation by the Senate. The executive director is
1312	responsible for employing other staff as the corporation may
1313	require, subject to review and concurrence by the board.
1314	b.  The board shall create a Market Accountability Advisory
1315	Committee to assist the corporation in developing awareness of
1316	its rates and its customer and agent service levels in
1317	relationship to the voluntary market insurers writing similar
1318	coverage. The members of the advisory committee shall consist of
1319	the following 11 persons, one of whom must be elected chair by
1320	the members of the committee: four representatives, one
1321	appointed by the Florida Association of Insurance Agents, one by
1322	the Florida Association of Insurance and Financial Advisors, one
1323	by the Professional Insurance Agents of Florida, and one by the
1324	Latin American Association of Insurance Agencies; three
1325	representatives appointed by the insurers with the three highest
1326	voluntary market share of residential property insurance
1327	business in the state; one representative from the Office of
1328	Insurance Regulation; one consumer appointed by the board who is
1329	insured by the corporation at the time of appointment to the
1330	committee; one representative appointed by the Florida
1331	Association of Realtors; and one representative appointed by the
1332	Florida Bankers Association. All members must serve for 3-year
1333	terms and may serve for consecutive terms. The committee shall
1334	report to the corporation at each board meeting on insurance
1335	market issues which may include rates and rate competition with
1336	the voluntary market; service, including policy issuance, claims
1337	processing, and general responsiveness to policyholders,
1338	applicants, and agents; and matters relating to depopulation.
1339	5.  Must provide a procedure for determining the
1340	eligibility of a risk for coverage, as follows:
1341	a.  Subject to the provisions of s. 627.3517, with respect
1342	to personal lines residential risks, if the risk is offered
1343	coverage from an authorized insurer at the insurer's approved
1344	rate under either a standard policy including wind coverage or,
1345	if consistent with the insurer's underwriting rules as filed
1346	with the office, a basic policy including wind coverage, for a
1347	new application to the corporation for coverage, the risk is not
1348	eligible for any policy issued by the corporation unless the
1349	premium for coverage from the authorized insurer is more than 25
1350	percent greater than the premium for comparable coverage from
1351	the corporation. If the risk is not able to obtain any such
1352	offer, the risk is eligible for either a standard policy
1353	including wind coverage or a basic policy including wind
1354	coverage issued by the corporation; however, if the risk could
1355	not be insured under a standard policy including wind coverage
1356	regardless of market conditions, the risk shall be eligible for
1357	a basic policy including wind coverage unless rejected under
1358	subparagraph 8. However, with regard to a policyholder of the
1359	corporation or a policyholder removed from the corporation
1360	through an assumption agreement until the end of the assumption
1361	period, the policyholder remains eligible for coverage from the
1362	corporation regardless of any offer of coverage from an
1363	authorized insurer or surplus lines insurer. The corporation
1364	shall determine the type of policy to be provided on the basis
1365	of objective standards specified in the underwriting manual and
1366	based on generally accepted underwriting practices.
1367	(I)  If the risk accepts an offer of coverage through the
1368	market assistance plan or an offer of coverage through a
1369	mechanism established by the corporation before a policy is
1370	issued to the risk by the corporation or during the first 30
1371	days of coverage by the corporation, and the producing agent who
1372	submitted the application to the plan or to the corporation is
1373	not currently appointed by the insurer, the insurer shall:
1374	(A)  Pay to the producing agent of record of the policy,
1375	for the first year, an amount that is the greater of the
1376	insurer's usual and customary commission for the type of policy
1377	written or a fee equal to the usual and customary commission of
1378	the corporation; or
1379	(B)  Offer to allow the producing agent of record of the
1380	policy to continue servicing the policy for a period of not less
1381	than 1 year and offer to pay the agent the greater of the
1382	insurer's or the corporation's usual and customary commission
1383	for the type of policy written.
1384
1385	If the producing agent is unwilling or unable to accept
1386	appointment, the new insurer shall pay the agent in accordance
1387	with sub-sub-sub-subparagraph (A).
1388	(II)  When the corporation enters into a contractual
1389	agreement for a take-out plan, the producing agent of record of
1390	the corporation policy is entitled to retain any unearned
1391	commission on the policy, and the insurer shall:
1392	(A)  Pay to the producing agent of record of the
1393	corporation policy, for the first year, an amount that is the
1394	greater of the insurer's usual and customary commission for the
1395	type of policy written or a fee equal to the usual and customary
1396	commission of the corporation; or
1397	(B)  Offer to allow the producing agent of record of the
1398	corporation policy to continue servicing the policy for a period
1399	of not less than 1 year and offer to pay the agent the greater
1400	of the insurer's or the corporation's usual and customary
1401	commission for the type of policy written.
1402
1403	If the producing agent is unwilling or unable to accept
1404	appointment, the new insurer shall pay the agent in accordance
1405	with sub-sub-sub-subparagraph (A).
1406	b.  With respect to commercial lines residential risks, for
1407	a new application to the corporation for coverage, if the risk
1408	is offered coverage under a policy including wind coverage from
1409	an authorized insurer at its approved rate, the risk is not
1410	eligible for any policy issued by the corporation unless the
1411	premium for coverage from the authorized insurer is more than 25
1412	percent greater than the premium for comparable coverage from
1413	the corporation. If the risk is not able to obtain any such
1414	offer, the risk is eligible for a policy including wind coverage
1415	issued by the corporation. However, with regard to a
1416	policyholder of the corporation or a policyholder removed from
1417	the corporation through an assumption agreement until the end of
1418	the assumption period, the policyholder remains eligible for
1419	coverage from the corporation regardless of any offer of
1420	coverage from an authorized insurer or surplus lines insurer.
1421	(I)  If the risk accepts an offer of coverage through the
1422	market assistance plan or an offer of coverage through a
1423	mechanism established by the corporation before a policy is
1424	issued to the risk by the corporation or during the first 30
1425	days of coverage by the corporation, and the producing agent who
1426	submitted the application to the plan or the corporation is not
1427	currently appointed by the insurer, the insurer shall:
1428	(A)  Pay to the producing agent of record of the policy,
1429	for the first year, an amount that is the greater of the
1430	insurer's usual and customary commission for the type of policy
1431	written or a fee equal to the usual and customary commission of
1432	the corporation; or
1433	(B)  Offer to allow the producing agent of record of the
1434	policy to continue servicing the policy for a period of not less
1435	than 1 year and offer to pay the agent the greater of the
1436	insurer's or the corporation's usual and customary commission
1437	for the type of policy written.
1438
1439	If the producing agent is unwilling or unable to accept
1440	appointment, the new insurer shall pay the agent in accordance
1441	with sub-sub-sub-subparagraph (A).
1442	(II)  When the corporation enters into a contractual
1443	agreement for a take-out plan, the producing agent of record of
1444	the corporation policy is entitled to retain any unearned
1445	commission on the policy, and the insurer shall:
1446	(A)  Pay to the producing agent of record of the
1447	corporation policy, for the first year, an amount that is the
1448	greater of the insurer's usual and customary commission for the
1449	type of policy written or a fee equal to the usual and customary
1450	commission of the corporation; or
1451	(B)  Offer to allow the producing agent of record of the
1452	corporation policy to continue servicing the policy for a period
1453	of not less than 1 year and offer to pay the agent the greater
1454	of the insurer's or the corporation's usual and customary
1455	commission for the type of policy written.
1456
1457	If the producing agent is unwilling or unable to accept
1458	appointment, the new insurer shall pay the agent in accordance
1459	with sub-sub-sub-subparagraph (A).
1460	c.  For purposes of determining comparable coverage under
1461	sub-subparagraphs a. and b., the comparison shall be based on
1462	those forms and coverages that are reasonably comparable. The
1463	corporation may rely on a determination of comparable coverage
1464	and premium made by the producing agent who submits the
1465	application to the corporation, which determination shall be
1466	presumed correct and deemed to be made in the agent's capacity
1467	as the corporation's agent. A comparison may be made solely of
1468	the premium with respect to the main building or structure only
1469	on the following basis: the same coverage A or other building
1470	limits; the same percentage hurricane deductible that applies on
1471	an annual basis or that applies to each hurricane for commercial
1472	residential property; the same percentage of ordinance and law
1473	coverage, if the same limit is offered by both the corporation
1474	and the authorized insurer; the same mitigation credits, to the
1475	extent the same types of credits are offered both by the
1476	corporation and the authorized insurer; the same method for loss
1477	payment, such as replacement cost or actual cash value, if the
1478	same method is offered both by the corporation and the
1479	authorized insurer in accordance with underwriting rules; and
1480	any other form or coverage that is reasonably comparable as
1481	determined by the board. Any other differences in coverage may
1482	be ignored. If an application is submitted to the corporation
1483	for wind-only coverage in the high-risk account, the premium for
1484	the corporation's wind-only policy plus the premium for the ex-
1485	wind policy that is offered by an authorized insurer to the
1486	applicant shall be compared to the premium for multiperil
1487	coverage offered by an authorized insurer, subject to the
1488	standards for comparison specified in this subparagraph. If the
1489	corporation or the applicant requests from the authorized
1490	insurer a breakdown of the premium of the offer by types of
1491	coverage so that a comparison may be made by the corporation or
1492	its agent and the authorized insurer refuses or is unable to
1493	provide such information, the corporation may treat the offer as
1494	not being an offer of coverage from an authorized insurer at the
1495	insurer's approved rate.
1496	6.  Must provide by July 1, 2007, that an application for
1497	coverage for a new policy is subject to a waiting period of 10
1498	days before coverage is effective, during which time the
1499	corporation shall make such application available for review by
1500	general lines agents and authorized property and casualty
1501	insurers. The board shall approve an exception that allows for
1502	coverage to be effective before the end of the 10-day waiting
1503	period, for coverage issued in conjunction with a real estate
1504	closing. The board may approve such other exceptions as the
1505	board determines are necessary to prevent lapses in coverage.
1506	6.7.  Must include rules for classifications of risks and
1507	rates therefor.
1508	7.8.  Must provide that if premium and investment income
1509	for an account attributable to a particular calendar year are in
1510	excess of projected losses and expenses for the account
1511	attributable to that year, such excess shall be held in surplus
1512	in the account. Such surplus shall be available to defray
1513	deficits in that account as to future years and shall be used
1514	for that purpose prior to assessing assessable insurers and
1515	assessable insureds as to any calendar year.
1516	8.9.  Must provide objective criteria and procedures to be
1517	uniformly applied for all applicants in determining whether an
1518	individual risk is so hazardous as to be uninsurable. In making
1519	this determination and in establishing the criteria and
1520	procedures, the following shall be considered:
1521	a.  Whether the likelihood of a loss for the individual
1522	risk is substantially higher than for other risks of the same
1523	class; and
1524	b.  Whether the uncertainty associated with the individual
1525	risk is such that an appropriate premium cannot be determined.
1526
1527	The acceptance or rejection of a risk by the corporation shall
1528	be construed as the private placement of insurance, and the
1529	provisions of chapter 120 shall not apply.
1530	9.10.  Must provide that the corporation shall make its
1531	best efforts to procure catastrophe reinsurance at reasonable
1532	rates, to cover its projected 100-year probable maximum loss as
1533	determined by the board of governors.
1534	10.11.  Must provide that in the event of regular deficit
1535	assessments under sub-subparagraph (b)3.a. or sub-subparagraph
1536	(b)3.b., in the personal lines account, the commercial lines
1537	residential account, or the high-risk account, the corporation
1538	shall levy upon corporation policyholders in its next rate
1539	filing, or by a separate rate filing solely for this purpose, a
1540	Citizens policyholder surcharge arising from a regular
1541	assessment in such account in a percentage equal to the total
1542	amount of such regular assessments divided by the aggregate
1543	statewide direct written premium for subject lines of business
1544	for the prior calendar year. For purposes of calculating the
1545	Citizens policyholder surcharge to be levied under this
1546	subparagraph, the total amount of the regular assessment to
1547	which this surcharge is related shall be determined as set forth
1548	in subparagraph (b)3., without deducting the estimated Citizens
1549	policyholder surcharge. Citizens policyholder surcharges under
1550	this subparagraph are not considered premium and are not subject
1551	to commissions, fees, or premium taxes; however, failure to pay
1552	a market equalization surcharge shall be treated as failure to
1553	pay premium.
1554	11.12.  The policies issued by the corporation must provide
1555	that, if the corporation or the market assistance plan obtains
1556	an offer from an authorized insurer to cover the risk at its
1557	approved rates, the risk is no longer eligible for renewal
1558	through the corporation, except as otherwise provided in this
1559	subsection.
1560	12.13.  Corporation policies and applications must include
1561	a notice that the corporation policy could, under this section,
1562	be replaced with a policy issued by an authorized insurer that
1563	does not provide coverage identical to the coverage provided by
1564	the corporation. The notice shall also specify that acceptance
1565	of corporation coverage creates a conclusive presumption that
1566	the applicant or policyholder is aware of this potential.
1567	13.14.  May establish, subject to approval by the office,
1568	different eligibility requirements and operational procedures
1569	for any line or type of coverage for any specified county or
1570	area if the board determines that such changes to the
1571	eligibility requirements and operational procedures are
1572	justified due to the voluntary market being sufficiently stable
1573	and competitive in such area or for such line or type of
1574	coverage and that consumers who, in good faith, are unable to
1575	obtain insurance through the voluntary market through ordinary
1576	methods would continue to have access to coverage from the
1577	corporation. When coverage is sought in connection with a real
1578	property transfer, such requirements and procedures shall not
1579	provide for an effective date of coverage later than the date of
1580	the closing of the transfer as established by the transferor,
1581	the transferee, and, if applicable, the lender.
1582	14.15.  Must provide that, with respect to the high-risk
1583	account, any assessable insurer with a surplus as to
1584	policyholders of $25 million or less writing 25 percent or more
1585	of its total countrywide property insurance premiums in this
1586	state may petition the office, within the first 90 days of each
1587	calendar year, to qualify as a limited apportionment company. A
1588	regular assessment levied by the corporation on a limited
1589	apportionment company for a deficit incurred by the corporation
1590	for the high-risk account in 2006 or thereafter may be paid to
1591	the corporation on a monthly basis as the assessments are
1592	collected by the limited apportionment company from its insureds
1593	pursuant to s. 627.3512, but the regular assessment must be paid
1594	in full within 12 months after being levied by the corporation.
1595	A limited apportionment company shall collect from its
1596	policyholders any emergency assessment imposed under sub-
1597	subparagraph (b)3.d. The plan shall provide that, if the office
1598	determines that any regular assessment will result in an
1599	impairment of the surplus of a limited apportionment company,
1600	the office may direct that all or part of such assessment be
1601	deferred as provided in subparagraph (g)4. However, there shall
1602	be no limitation or deferment of an emergency assessment to be
1603	collected from policyholders under sub-subparagraph (b)3.d.
1604	15.16.  Must provide that the corporation appoint as its
1605	licensed agents only those agents who also hold an appointment
1606	as defined in s. 626.015(3) with an insurer who at the time of
1607	the agent's initial appointment by the corporation is authorized
1608	to write and is actually writing personal lines residential
1609	property coverage, commercial residential property coverage, or
1610	commercial nonresidential property coverage within the state.
1611	16.17.  Must provide, by July 1, 2007, a premium payment
1612	plan option to its policyholders which allows at a minimum for
1613	quarterly and semiannual payment of premiums. A monthly payment
1614	plan may, but is not required to, be offered.
1615	17.18.  Must provide, effective June 1, 2007, that the
1616	corporation contract with each insurer providing the non-wind
1617	coverage for risks insured by the corporation in the high-risk
1618	account, requiring that the insurer provide claims adjusting
1619	services for the wind coverage provided by the corporation for
1620	such risks. An insurer is required to enter into this contract
1621	as a condition of providing non-wind coverage for a risk that is
1622	insured by the corporation in the high-risk account unless the
1623	board approves an exemption for good cause finds, after a
1624	hearing, that the insurer is not capable of providing adjusting
1625	services at an acceptable level of quality to corporation
1626	policyholders. The terms and conditions of such contracts must
1627	be substantially the same as the contracts that the corporation
1628	executed with insurers under the "adjust-your-own" program in
1629	2006, except as may be mutually agreed to by the parties and
1630	except for such changes that the board determines are necessary
1631	to ensure that claims are adjusted appropriately. The
1632	corporation shall provide a process for neutral arbitration of
1633	any dispute between the corporation and the insurer regarding
1634	the terms of the contract. The corporation shall review and
1635	monitor the performance of insurers under these contracts.
1636	18.19.  Must limit coverage on mobile homes or manufactured
1637	homes built prior to 1994 to actual cash value of the dwelling
1638	rather than replacement costs of the dwelling.
1639	19.20.  May provide such limits of coverage as the board
1640	determines, consistent with the requirements of this subsection.
1641	20.21.  May require commercial property to meet specified
1642	hurricane mitigation construction features as a condition of
1643	eligibility for coverage.
1644	(d)1.  All prospective employees for senior management
1645	positions, as defined by the plan of operation, are subject to
1646	background checks as a prerequisite for employment. The office
1647	shall conduct background checks on such prospective employees
1648	pursuant to ss. 624.34, 624.404(3), and 628.261.
1649	2.  On or before July 1 of each year, employees of the
1650	corporation are required to sign and submit a statement
1651	attesting that they do not have a conflict of interest, as
1652	defined in part III of chapter 112. As a condition of
1653	employment, all prospective employees are required to sign and
1654	submit to the corporation a conflict-of-interest statement.
1655	3.  Senior managers and members of the board of governors
1656	are subject to the provisions of ss. 112.313, 112.3135,
1657	112.3143, 112.3145, 112.316, and 112.317, which apply to
1658	political subdivisions of the state part III of chapter 112,
1659	including, but not limited to, the code of ethics and public
1660	disclosure and reporting of financial interests, pursuant to s.
1661	112.3145. For purposes of the filing requirements in s.
1662	112.3145, senior managers and board members are also required to
1663	file such disclosures with the Commission on Ethics and the
1664	Office of Insurance Regulation. The executive director of the
1665	corporation or his or her designee shall notify each newly
1666	appointed and existing appointed member of the board of
1667	governors and senior managers of their duty to comply with the
1668	reporting requirements of s. 112.3145 part III of chapter 112.
1669	At least quarterly, the executive director or his or her
1670	designee shall submit to the Commission on Ethics a list of
1671	names of the senior managers and members of the board of
1672	governors who are subject to the public disclosure requirements
1673	under s. 112.3145. Notwithstanding s. 112.313, if a member of
1674	the board of governors has been appointed by his or her
1675	appointing officer because of demonstrated expertise in
1676	insurance, such member may be an employee, officer, owner, or
1677	director of an insurance agency or insurance company or other
1678	insurance entity that has a contractual relationship with the
1679	corporation. Such board member may participate in and vote on a
1680	matter if the applicable provisions of s. 112.3143 are met and
1681	if the insurance entity would not obtain a special or unique
1682	benefit that would not apply to other similar insurance entities
1683	that have a contractual relationship with the corporation. For
1684	purposes of the applicable sections of chapter 112 cited in this
1685	subparagraph, senior managers of the corporation are subject to
1686	those provisions applicable to employees of political
1687	subdivisions of the state and board members are subject to those
1688	provisions applicable to appointed public officers or public
1689	officials of political subdivisions of the state and, for
1690	purposes of s. 112.3143(2), board members are considered state
1691	public officers.
1692	4.  Notwithstanding s. 112.3148 or s. 112.3149, or any
1693	other provision of law, an employee or board member may not
1694	knowingly accept, directly or indirectly, any gift or
1695	expenditure from a person or entity, or an employee or
1696	representative of such person or entity, that has a contractual
1697	relationship with the corporation or who is under consideration
1698	for a contract. An employee or board member who fails to comply
1699	with subparagraph 3. or this subparagraph is subject to
1700	penalties provided under s. ss. 112.317 and 112.3173.
1701	5.  Any senior manager of the corporation who is employed
1702	on or after January 1, 2007, regardless of the date of hire, who
1703	subsequently retires or terminates employment is prohibited from
1704	representing another person or entity before the corporation for
1705	2 years after retirement or termination of employment from the
1706	corporation.
1707	6.  Any senior manager employee of the corporation who is
1708	employed on or after January 1, 2007, regardless of the date of
1709	hire, who subsequently retires or terminates employment is
1710	prohibited from having any employment or contractual
1711	relationship for 2 years with an insurer that has entered into
1712	received a take-out bonus agreement with from the corporation.
1713	(j)1.  The corporation shall establish and maintain a unit
1714	or division to investigate possible fraudulent claims by
1715	insureds or by persons making claims for services or repairs
1716	against policies held by insureds; or it may contract with
1717	others to investigate possible fraudulent claims for services or
1718	repairs against policies held by the corporation pursuant to s.
1719	626.9891. The corporation must comply with reporting
1720	requirements of s. 626.9891. An employee of the corporation
1721	shall notify the corporation's Office of the Internal Auditor
1722	Division of Insurance Fraud within 48 hours after having
1723	information that would lead a reasonable person to suspect that
1724	fraud may have been committed by any employee of the
1725	corporation.
1726	2.  The corporation shall establish a unit or division
1727	responsible for receiving and responding to consumer complaints,
1728	which unit or division is the sole responsibility of a senior
1729	manager of the corporation.
1730	(m)1.  Rates for coverage provided by the corporation shall
1731	be actuarially sound and subject to the requirements of s.
1732	627.062, except as otherwise provided in this paragraph. The
1733	corporation shall file its recommended rates with the office at
1734	least annually. The corporation shall provide any additional
1735	information regarding the rates which the office requires. The
1736	office shall consider the recommendations of the board and issue
1737	a final order establishing the rates for the corporation within
1738	45 days after the recommended rates are filed. The corporation
1739	may not pursue an administrative challenge or judicial review of
1740	the final order of the office.
1741	2.  In addition to the rates otherwise determined pursuant
1742	to this paragraph, the corporation shall impose and collect an
1743	amount equal to the premium tax provided for in s. 624.509 to
1744	augment the financial resources of the corporation.
1745	3.  After the public hurricane loss-projection model under
1746	s. 627.06281 has been found to be accurate and reliable by the
1747	Florida Commission on Hurricane Loss Projection Methodology,
1748	that model shall serve as the minimum benchmark for determining
1749	the windstorm portion of the corporation's rates. This
1750	subparagraph does not require or allow the corporation to adopt
1751	rates lower than the rates otherwise required or allowed by this
1752	paragraph.
1753	4.  The rate filings for the corporation which were
1754	approved by the office and which took effect January 1, 2007,
1755	are rescinded, except for those rates that were lowered. As soon
1756	as possible, the corporation shall begin using the lower rates
1757	that were in effect on December 31, 2006, and shall provide
1758	refunds to policyholders who have paid higher rates as a result
1759	of that rate filing. The rates in effect on December 31, 2006,
1760	shall remain in effect through at least December 31, 2007, for
1761	the 2007 calendar year except for any rate change that results
1762	in a lower rate. The next rate change that may increase rates
1763	shall be filed with the office by take effect January 1, 2008,
1764	pursuant to a new rate filing recommended by the corporation and
1765	established by the office, subject to the requirements of this
1766	paragraph.
1767	(n)  If coverage in an account is deactivated pursuant to
1768	paragraph (f), coverage through the corporation shall be
1769	reactivated by order of the office only under one of the
1770	following circumstances:
1771	1.  If the market assistance plan receives a minimum of 100
1772	applications for coverage within a 3-month period, or 200
1773	applications for coverage within a 1-year period or less for
1774	residential coverage, unless the market assistance plan provides
1775	a quotation from admitted carriers at their filed rates for at
1776	least 90 percent of such applicants. Any market assistance plan
1777	application that is rejected because an individual risk is so
1778	hazardous as to be uninsurable using the criteria specified in
1779	subparagraph (c)7.8. shall not be included in the minimum
1780	percentage calculation provided herein. In the event that there
1781	is a legal or administrative challenge to a determination by the
1782	office that the conditions of this subparagraph have been met
1783	for eligibility for coverage in the corporation, any eligible
1784	risk may obtain coverage during the pendency of such challenge.
1785	2.  In response to a state of emergency declared by the
1786	Governor under s. 252.36, the office may activate coverage by
1787	order for the period of the emergency upon a finding by the
1788	office that the emergency significantly affects the availability
1789	of residential property insurance.
1790	(v)  Notwithstanding any other provision of law:
1791	1.  The pledge or sale of, the lien upon, and the security
1792	interest in any rights, revenues, or other assets of the
1793	corporation created or purported to be created pursuant to any
1794	financing documents to secure any bonds or other indebtedness of
1795	the corporation shall be and remain valid and enforceable,
1796	notwithstanding the commencement of and during the continuation
1797	of, and after, any rehabilitation, insolvency, liquidation,
1798	bankruptcy, receivership, conservatorship, reorganization, or
1799	similar proceeding against the corporation under the laws of
1800	this state.
1801	2.  No such proceeding shall relieve the corporation of its
1802	obligation, or otherwise affect its ability to perform its
1803	obligation, to continue to collect, or levy and collect,
1804	assessments, market equalization or other surcharges under
1805	subparagraph (c)9.10., or any other rights, revenues, or other
1806	assets of the corporation pledged pursuant to any financing
1807	documents.
1808	3.  Each such pledge or sale of, lien upon, and security
1809	interest in, including the priority of such pledge, lien, or
1810	security interest, any such assessments, market equalization or
1811	other surcharges, or other rights, revenues, or other assets
1812	which are collected, or levied and collected, after the
1813	commencement of and during the pendency of, or after, any such
1814	proceeding shall continue unaffected by such proceeding. As used
1815	in this subsection, the term "financing documents" means any
1816	agreement or agreements, instrument or instruments, or other
1817	document or documents now existing or hereafter created
1818	evidencing any bonds or other indebtedness of the corporation or
1819	pursuant to which any such bonds or other indebtedness has been
1820	or may be issued and pursuant to which any rights, revenues, or
1821	other assets of the corporation are pledged or sold to secure
1822	the repayment of such bonds or indebtedness, together with the
1823	payment of interest on such bonds or such indebtedness, or the
1824	payment of any other obligation or financial product, as defined
1825	in the plan of operation of the corporation related to such
1826	bonds or indebtedness.
1827	4.  Any such pledge or sale of assessments, revenues,
1828	contract rights, or other rights or assets of the corporation
1829	shall constitute a lien and security interest, or sale, as the
1830	case may be, that is immediately effective and attaches to such
1831	assessments, revenues, or contract rights or other rights or
1832	assets, whether or not imposed or collected at the time the
1833	pledge or sale is made. Any such pledge or sale is effective,
1834	valid, binding, and enforceable against the corporation or other
1835	entity making such pledge or sale, and valid and binding against
1836	and superior to any competing claims or obligations owed to any
1837	other person or entity, including policyholders in this state,
1838	asserting rights in any such assessments, revenues, or contract
1839	rights or other rights or assets to the extent set forth in and
1840	in accordance with the terms of the pledge or sale contained in
1841	the applicable financing documents, whether or not any such
1842	person or entity has notice of such pledge or sale and without
1843	the need for any physical delivery, recordation, filing, or
1844	other action.
1845	5.  As long as the corporation has any bonds outstanding,
1846	the corporation may not file a voluntary petition under chapter
1847	9 of the federal Bankruptcy Code or such corresponding chapter
1848	or sections as may be in effect, from time to time, and a public
1849	officer or any organization, entity, or other person may not
1850	authorize the corporation to be or become a debtor under chapter
1851	9 of the federal Bankruptcy Code or such corresponding chapter
1852	or sections as may be in effect, from time to time, during any
1853	such period.
1854	6.  If ordered by a court of competent jurisdiction, the
1855	corporation may assume policies or otherwise provide coverage
1856	for policyholders of an insurer placed in liquidation under
1857	chapter 631, under such forms, rates, terms, and conditions as
1858	the corporation deems appropriate, subject to approval by the
1859	office.
1860	Section 11.  Subsection (4) of section 627.3511, Florida
1861	Statutes, is amended to read:
1862	627.3511  Depopulation of Citizens Property Insurance
1863	Corporation.--
1864	(4)  AGENT BONUS.--When the corporation enters into a
1865	contractual agreement for a take-out plan that provides a bonus
1866	to the insurer, the producing agent of record of the corporation
1867	policy is entitled to retain any unearned commission on such
1868	policy, and the insurer shall either:
1869	(a)  Pay to the producing agent of record of the
1870	association policy, for the first year, an amount that is the
1871	greater of the insurer's usual and customary commission for the
1872	type of policy written or a fee equal to the usual and customary
1873	commission of the corporation; or
1874	(b)  Offer to allow the producing agent of record of the
1875	corporation policy to continue servicing the policy for a period
1876	of not less than 1 year and offer to pay the agent the greater
1877	of the insurer's or the corporation's usual and customary
1878	commission for the type of policy written.
1879
1880	If the producing agent is unwilling or unable to accept
1881	appointment, the new insurer shall pay the agent in accordance
1882	with paragraph (a). The requirement of this subsection that the
1883	producing agent of record is entitled to retain the unearned
1884	commission on an association policy does not apply to a policy
1885	for which coverage has been provided in the association for 30
1886	days or less or for which a cancellation notice has been issued
1887	pursuant to s. 627.351(6)(c)10.11. during the first 30 days of
1888	coverage.
1889	Section 12.  Paragraph (a) of subsection (3) of section
1890	627.3515, Florida Statutes, as amended by chapter 2007-1, Laws
1891	of Florida, is amended to read:
1892	627.3515  Market assistance plan; property and casualty
1893	risks.--
1894	(3)(a)  The plan and the corporation shall develop a
1895	business plan and present it to the Financial Services
1896	Commission for approval by September 1, 2007, to provide for the
1897	implementation of an electronic database for the purpose of
1898	confirming eligibility pursuant to s. 627.351(6). The business
1899	plan may provide that authorized insurers or agents of
1900	authorized insurers may submit to the plan or the corporation in
1901	electronic form, as determined by the plan or the corporation,
1902	information determined necessary by the plan or the corporation
1903	to deny coverage to risks ineligible for coverage by the
1904	corporation. Any authorized insurer submitting such information
1905	that results in a risk being denied coverage by the corporation
1906	is required to provide coverage to the risk at its approved
1907	rates, for the coverage and premium quoted, for at least 1 year.
1908	Section 13.  Section 627.3517, Florida Statutes, is amended
1909	to read:
1910	627.3517  Consumer choice.--
1911	(1)  Except as provided in subsection (2), No provision of
1912	s. 627.351, s. 627.3511, or s. 627.3515 shall be construed to
1913	impair the right of any insurance risk apportionment plan
1914	policyholder, upon receipt of any keepout or take-out offer, to
1915	retain his or her current agent, so long as that agent is duly
1916	licensed and appointed by the insurance risk apportionment plan
1917	or otherwise authorized to place business with the insurance
1918	risk apportionment plan. This right shall not be canceled,
1919	suspended, impeded, abridged, or otherwise compromised by any
1920	rule, plan of operation, or depopulation plan, whether through
1921	keepout, take-out, midterm assumption, or any other means, of
1922	any insurance risk apportionment plan or depopulation plan,
1923	including, but not limited to, those described in s. 627.351, s.
1924	627.3511, or s. 627.3515. The commission shall adopt any rules
1925	necessary to cause any insurance risk apportionment plan or
1926	market assistance plan under such sections to demonstrate that
1927	the operations of the plan do not interfere with, promote, or
1928	allow interference with the rights created under this section.
1929	If the policyholder's current agent is unable or unwilling to be
1930	appointed with the insurer making the take-out or keepout offer,
1931	the policyholder shall not be disqualified from participation in
1932	the appropriate insurance risk apportionment plan because of an
1933	offer of coverage in the voluntary market. An offer of full
1934	property insurance coverage by the insurer currently insuring
1935	either the ex-wind or wind-only coverage on the policy to which
1936	the offer applies shall not be considered a take-out or keepout
1937	offer. Any rule, plan of operation, or plan of depopulation,
1938	through keepout, take-out, midterm assumption, or any other
1939	means, of any property insurance risk apportionment plan under
1940	s. 627.351(2) or (6) is subject to ss. 627.351(2)(b) and (6)(c)
1941	and 627.3511(4).
1942	(2)  This section does not apply during the first 10 days
1943	after a new application for coverage has been submitted to
1944	Citizens Property Insurance Corporation under s. 627.351(6),
1945	whether or not coverage is bound during this period.
1946	Section 14.  Subsection (1) of section 627.4035, Florida
1947	Statutes, as amended by chapter 2007-1, Laws of Florida, is
1948	amended to read:
1949	627.4035  Cash payment of premiums; claims.--
1950	(1)  The premiums for insurance contracts issued in this
1951	state or covering risk located in this state shall be paid in
1952	cash consisting of coins, currency, checks, or money orders or
1953	by using a debit card, credit card, automatic electronic funds
1954	transfer, or payroll deduction plan. By July 1, 2007, insurers
1955	issuing personal lines residential and commercial property
1956	policies shall provide a premium payment plan option to their
1957	policyholders which allows for a minimum of quarterly and
1958	semiannual payment of premiums. Insurers may, but are not
1959	required to, offer monthly payment plans. Insurers issuing such
1960	policies must submit their premium payment plan option to the
1961	office for approval before use.
1962	Section 15.  Subsection (7) is added to section 627.4133,
1963	Florida Statutes, to read:
1964	627.4133  Notice of cancellation, nonrenewal, or renewal
1965	premium.--
1966	(7)(a)  Effective August 1, 2007, with respect to any
1967	residential property insurance policy, every notice of renewal
1968	premium must specify:
1969	1.  The dollar amounts recouped for assessments by the
1970	Florida Hurricane Catastrophe Fund, the Citizens Property
1971	Insurance Corporation, and the Florida Insurance Guaranty
1972	Association. The actual names of the entities must appear next
1973	to the dollar amounts.
1974	2.  The dollar amount of any premium increase that is due
1975	to an approved rate increase and the dollar amounts that are due
1976	to coverage changes.
1977	(b)  The Financial Services Commission may adopt rules
1978	pursuant to ss. 120.536(1) and 120.54 to implement this
1979	subsection.
1980	Section 16.  Paragraphs (a) and (c) of subsection (3) and
1981	paragraph (d) of subsection (4) of section 627.701, Florida
1982	Statutes, as amended by chapter 2007-1, Laws of Florida, are
1983	amended to read:
1984	627.701  Liability of insureds; coinsurance; deductibles.--
1985	(3)(a)  Except as otherwise provided in this subsection,
1986	prior to issuing a personal lines residential property insurance
1987	policy, the insurer must offer alternative deductible amounts
1988	applicable to hurricane losses equal to $500, 2 percent, 5
1989	percent, and 10 percent of the policy dwelling limits, unless
1990	the specific percentage deductible is less than $500. The
1991	written notice of the offer shall specify the hurricane or wind
1992	deductible to be applied in the event that the applicant or
1993	policyholder fails to affirmatively choose a hurricane
1994	deductible. The insurer must provide such policyholder with
1995	notice of the availability of the deductible amounts specified
1996	in this paragraph in a form approved by the office in
1997	conjunction with each renewal of the policy. The failure to
1998	provide such notice constitutes a violation of this code but
1999	does not affect the coverage provided under the policy.
2000	(c)  With respect to a policy covering a risk with dwelling
2001	limits of at least $100,000, but less than $250,000, the insurer
2002	may, in lieu of offering a policy with a $500 hurricane or wind
2003	deductible as required by paragraph (a), offer a policy that the
2004	insurer guarantees it will not nonrenew for reasons of reducing
2005	hurricane loss for one renewal period and that contains up to a
2006	2 percent hurricane or wind deductible as required by paragraph
2007	(a).
2008	(4)
2009	(d)1.  A personal lines residential property insurance
2010	policy covering a risk valued at less than $500,000 may not have
2011	a hurricane deductible in excess of 10 percent of the policy
2012	dwelling limits, unless the following conditions are met:
2013	a.  The policyholder must personally write and provide to
2014	the insurer the following statement in his or her own
2015	handwriting and sign his or her name, which must also be signed
2016	by every other named insured on the policy, and dated: "I do not
2017	want the insurance on my home to pay for the first (specify
2018	dollar value) of damage from hurricanes. I will pay those costs.
2019	My insurance will not."
2020	b.  If the structure insured by the policy is subject to a
2021	mortgage or lien, the policyholder must provide the insurer with
2022	a written statement from the mortgageholder or lienholder
2023	indicating that the mortgageholder or lienholder approves the
2024	policyholder electing to have the specified deductible.
2025	2.  A deductible subject to the requirements of this
2026	paragraph applies for the term of the policy and for each
2027	renewal thereafter unless the policyholder elects otherwise.
2028	Changes to the deductible percentage may be implemented only as
2029	of the date of renewal.
2030	3.  An insurer shall keep the original copy of the signed
2031	statement required by this paragraph, electronically or
2032	otherwise, and provide a copy to the policyholder providing the
2033	signed statement. A signed statement meeting the requirements of
2034	this paragraph creates a presumption that there was an informed,
2035	knowing election of coverage.
2036	4.  The commission shall adopt rules providing appropriate
2037	alternative methods for providing the statements required by
2038	this section for policyholders who have a handicapping or
2039	disabling condition that prevents them from providing a
2040	handwritten statement.
2041	Section 17.  Subsection (5) of section 627.70131, Florida
2042	Statutes, as amended by chapter 2007-1, Laws of Florida, is
2043	amended to read:
2044	627.70131  Insurer's duty to acknowledge communications
2045	regarding claims; investigation.--
2046	(5)  Within 90 days after an insurer receives notice of
2047	loss of a residential property insurance claim from a
2048	policyholder, the insurer shall pay or deny such claim unless
2049	the failure to pay such claim is caused by factors beyond the
2050	control of the insurer which reasonably prevent such payment.
2051	Within 90 days after an insurer receives notice of loss of a
2052	commercial property insurance claim from a policyholder, the
2053	insurer shall pay or deny such claim unless the insurer provides
2054	specific reasons to the policyholder why the claim cannot be
2055	paid within the 90-day period. Any overdue payment of a claim
2056	shall bear interest at the rate as set forth in s. 55.03.
2057	Interest on an overdue payment for a claim begins to accrue from
2058	the date the insurer receives notice of the claim. The interest
2059	is payable with the payment of the claim. The provisions of this
2060	subsection may not be waived, voided, or nullified by contract.
2061	The exclusive remedy for a violation of this subsection is a
2062	regulatory action under this code. Failure to comply with this
2063	subsection constitutes a violation of this code.
2064	Section 18.  Subsections (2), (4), and (5) of section
2065	627.712, Florida Statutes, as created by chapter 2007-1, Laws of
2066	Florida, are amended to read:
2067	627.712  Residential hurricane coverage required;
2068	availability of exclusions for windstorm or contents.--
2069	(1)  An insurer issuing a residential property insurance
2070	policy must provide hurricane or windstorm coverage as defined
2071	in s. 627.4025. This subsection does not apply with respect to
2072	risks that are eligible for wind-only coverage from Citizens
2073	Property Insurance Corporation under s. 627.351(6).
2074	(2)  A property An insurer that is subject to subsection
2075	(1) must make available, at the option of the policyholder, an
2076	exclusion of hurricane coverage or windstorm coverage as
2077	provided within the applicable policy. The coverage may be
2078	excluded only if:
2079	(a)1.  When the policyholder is a natural person, the
2080	policyholder personally writes and provides to the insurer the
2081	following statement in his or her own handwriting and signs his
2082	or her name, which must also be signed by every other named
2083	insured on the policy, and dated: "I do not want the insurance
2084	on my (home/mobile home/condominium unit) to pay for damage from
2085	windstorms or hurricanes. I will pay those costs. My insurance
2086	will not."
2087	2.  When the policyholder is other than a natural person,
2088	the policyholder provides to the insurer on the policyholder's
2089	letterhead the following statement that must be signed by the
2090	policyholder's authorized representative and dated: "(Name of
2091	entity) does not want the insurance on its (type of structure)
2092	to pay for damage from windstorms or hurricanes. (Name of
2093	entity) will be responsible for these costs. (Name of entity)'s
2094	insurance will not."
2095	(b)  If the structure insured by the policy is subject to a
2096	mortgage or lien, the policyholder must provide the insurer with
2097	a written statement from the mortgageholder or lienholder
2098	indicating that the mortgageholder or lienholder approves the
2099	policyholder electing to exclude windstorm coverage or hurricane
2100	coverage from his or her or its residential property insurance
2101	policy.
2102	(4)  An insurer shall keep the original copy of a signed
2103	statement required by this section, electronically or otherwise,
2104	and provide a copy to the policyholder providing the signed
2105	statement. A signed statement meeting the requirements of this
2106	section creates a presumption that there was an informed,
2107	knowing rejection of coverage.
2108	(5)  The exclusions authorized by this section apply for
2109	the term of the policy and for each renewal thereafter. Changes
2110	to the exclusions authorized by this section may be implemented
2111	only as of the date of renewal. The exclusions authorized by
2112	this section are valid for the term of the contract and for each
2113	renewal unless the policyholder elects otherwise.
2114	Section 19.  Section 627.713, Florida Statutes, as created
2115	by chapter 2007-1, Laws of Florida, is amended to read:
2116	627.713  Report of hurricane loss data.--
2117	(1)  The office may require property insurers to report
2118	data regarding hurricane claims and underwriting costs,
2119	including, but not limited to:
2120	(a)(1)  Number of claims.
2121	(b)(2)  Amount of claim payments made.
2122	(c)(3)  Number and amount of total-loss claims.
2123	(d)(4)  Amount and percentage of losses covered by
2124	reinsurance or other loss-transfer agreements.
2125	(e)(5)  Amount of losses covered under specified
2126	deductibles.
2127	(f)(6)  Claims and payments for specified insured values.
2128	(g)(7)  Claims and payments for specified dollar values.
2129	(h)(8)  Claims and payments for specified types of
2130	construction or mitigation features.
2131	(i)(9)  Claims and payments for policies under specified
2132	underwriting criteria.
2133	(j)(10)  Claims and payments for contents, additional
2134	living expense, and other specified coverages.
2135	(k)(11)  Claims and payments by county for the information
2136	specified in this section.
2137	(l)(12)  Any other data that the office requires.
2138	(2)  The office may not require a property insurer to
2139	report the data specified in paragraph (1)(f), paragraph (1)(g),
2140	paragraph (1)(h), paragraph (1)(i), or paragraph (1)(j) for a
2141	particular year until January of the following year or later.
2142	Section 20.  Subsections (4) and (5) of section 627.7277,
2143	Florida Statutes, as amended by chapter 2007-1, Laws of Florida,
2144	are amended to read:
2145	627.7277  Notice of renewal premium.--
2146	(4)  Every notice of renewal premium must specify:
2147	(a)  The dollar amounts recouped for assessments by the
2148	Florida Hurricane Catastrophe Fund, the Citizens Property
2149	Insurance Corporation, and the Florida Insurance Guaranty
2150	Association. The actual names of the entities must appear next
2151	to the dollar amounts.
2152	(b)  The dollar amount of any premium increase that is due
2153	to a rate increase and the dollar amounts that are due to
2154	coverage changes.
2155	(5)  The Financial Services Commission may adopt rules
2156	pursuant to ss. 120.536(1) and 120.54 to implement this section.
2157	Section 21.  Subsection (11) of section 631.52, Florida
2158	Statutes, is amended to read:
2159	631.52  Scope.--This part shall apply to all kinds of
2160	direct insurance, except:
2161	(11)  Self-insurance and any kind of self-insurance fund,
2162	liability pool, or risk management fund;
2163	Section 22.  Paragraph (e) of subsection (3) of section
2164	631.57, Florida Statutes, as amended by chapter 2007-1, Laws of
2165	Florida, is amended to read:
2166	631.57  Powers and duties of the association.--
2167	(3)
2168	(e)1.a.  In addition to assessments otherwise authorized in
2169	paragraph (a) and to the extent necessary to secure the funds
2170	for the account specified in s. 631.55(2)(c) for the direct
2171	payment of covered claims of insurers rendered insolvent by the
2172	effects of a hurricane homeowners' insurers and to pay the
2173	reasonable costs to administer such claims, or to retire
2174	indebtedness, including, without limitation, the principal,
2175	redemption premium, if any, and interest on, and related costs
2176	of issuance of, bonds issued under s. 631.695 and the funding of
2177	any reserves and other payments required under the bond
2178	resolution or trust indenture pursuant to which such bonds have
2179	been issued, the office, upon certification of the board of
2180	directors, shall levy emergency assessments upon insurers
2181	holding a certificate of authority. The emergency assessments
2182	payable under this paragraph by any insurer shall not exceed in
2183	any single year more than 2 percent of that insurer's direct
2184	written premiums, net of refunds, in this state during the
2185	preceding calendar year for the kinds of insurance within the
2186	account specified in s. 631.55(2)(c).
2187	b.  Any emergency assessments authorized under this
2188	paragraph shall be levied by the office upon insurers referred
2189	to in sub-subparagraph a., upon certification as to the need for
2190	such assessments by the board of directors. In the event the
2191	board of directors participates in the issuance of bonds in
2192	accordance with s. 631.695, emergency assessments shall be
2193	levied in each year that bonds issued under s. 631.695 and
2194	secured by such emergency assessments are outstanding, in such
2195	amounts up to such 2-percent limit as required in order to
2196	provide for the full and timely payment of the principal of,
2197	redemption premium, if any, and interest on, and related costs
2198	of issuance of, such bonds. The emergency assessments provided
2199	for in this paragraph are assigned and pledged to the
2200	municipality, county, or legal entity issuing bonds under s.
2201	631.695 for the benefit of the holders of such bonds, in order
2202	to enable such municipality, county, or legal entity to provide
2203	for the payment of the principal of, redemption premium, if any,
2204	and interest on such bonds, the cost of issuance of such bonds,
2205	and the funding of any reserves and other payments required
2206	under the bond resolution or trust indenture pursuant to which
2207	such bonds have been issued, without the necessity of any
2208	further action by the association, the office, or any other
2209	party. To the extent bonds are issued under s. 631.695 and the
2210	association determines to secure such bonds by a pledge of
2211	revenues received from the emergency assessments, such bonds,
2212	upon such pledge of revenues, shall be secured by and payable
2213	from the proceeds of such emergency assessments, and the
2214	proceeds of emergency assessments levied under this paragraph
2215	shall be remitted directly to and administered by the trustee or
2216	custodian appointed for such bonds.
2217	c.  Emergency assessments under this paragraph may be
2218	payable in a single payment or, at the option of the
2219	association, may be payable in 12 monthly installments with the
2220	first installment being due and payable at the end of the month
2221	after an emergency assessment is levied and subsequent
2222	installments being due not later than the end of each succeeding
2223	month.
2224	d.  If emergency assessments are imposed, the report
2225	required by s. 631.695(7) shall include an analysis of the
2226	revenues generated from the emergency assessments imposed under
2227	this paragraph.
2228	e.  If emergency assessments are imposed, the references in
2229	sub-subparagraph (1)(a)3.b. and s. 631.695(2) and (7) to
2230	assessments levied under paragraph (a) shall include emergency
2231	assessments imposed under this paragraph.
2232	2.  In order to ensure that insurers paying emergency
2233	assessments levied under this paragraph continue to charge rates
2234	that are neither inadequate nor excessive, within 90 days after
2235	being notified of such assessments, each insurer that is to be
2236	assessed pursuant to this paragraph shall submit a rate filing
2237	for coverage included within the account specified in s.
2238	631.55(2)(c) and for which rates are required to be filed under
2239	s. 627.062. If the filing reflects a rate change that, as a
2240	percentage, is equal to the difference between the rate of such
2241	assessment and the rate of the previous year's assessment under
2242	this paragraph, the filing shall consist of a certification so
2243	stating and shall be deemed approved when made. Any rate change
2244	of a different percentage shall be subject to the standards and
2245	procedures of s. 627.062.
2246	3.  In the event the board of directors participates in the
2247	issuance of bonds in accordance with s. 631.695, an annual
2248	assessment under this paragraph shall continue while the bonds
2249	issued with respect to which the assessment was imposed are
2250	outstanding, including any bonds the proceeds of which were used
2251	to refund bonds issued pursuant to s. 631.695, unless adequate
2252	provision has been made for the payment of the bonds in the
2253	documents authorizing the issuance of such bonds.
2254	4.  Emergency assessments under this paragraph are not
2255	premium and are not subject to the premium tax, to any fees, or
2256	to any commissions. An insurer is liable for all emergency
2257	assessments that the insurer collects and shall treat the
2258	failure of an insured to pay an emergency assessment as a
2259	failure to pay the premium. An insurer is not liable for
2260	uncollectible emergency assessments.
2261	Section 23.  Paragraphs (g), (h), and (i) of subsection (1)
2262	and subsections (2) and (6) of section 631.695, Florida
2263	Statutes, are amended to read:
2264	631.695  Revenue bond issuance through counties or
2265	municipalities.--
2266	(1)  The Legislature finds:
2267	(g)  To achieve the foregoing purposes, it is proper to
2268	authorize municipalities and counties of this state
2269	substantially affected by the landfall of a hurricane to issue
2270	bonds to assist the Florida Insurance Guaranty Association in
2271	expediting the handling and payment of covered claims of
2272	insolvent insurers.
2273	(h)  In order to avoid the needless and indiscriminate
2274	proliferation, duplication, and fragmentation of such assistance
2275	programs, it is in the best interests of the residents of this
2276	state to authorize municipalities and counties severely affected
2277	by a hurricane to provide for the payment of covered claims
2278	beyond their territorial limits in the implementation of such
2279	programs.
2280	(i)  It is a paramount public purpose for municipalities
2281	and counties substantially affected by the landfall of a
2282	hurricane to be able to issue bonds for the purposes described
2283	in this section. Such issuance shall provide assistance to
2284	residents of those municipalities and counties as well as to
2285	other residents of this state.
2286	(2)  The governing body of any municipality or county, the
2287	residents of which have been substantially affected by a
2288	hurricane, may issue bonds to fund an assistance program in
2289	conjunction with, and with the consent of, the Florida Insurance
2290	Guaranty Association for the purpose of paying claimants' or
2291	policyholders' covered claims, as defined in s. 631.54, arising
2292	through the insolvency of an insurer, which insolvency is
2293	determined by the Florida Insurance Guaranty Association to have
2294	been a result of a hurricane, regardless of whether the
2295	claimants or policyholders are residents of such municipality or
2296	county or the property to which the claim relates is located
2297	within or outside the territorial jurisdiction of the
2298	municipality or county. The power of a municipality or county to
2299	issue bonds, as described in this section, is in addition to any
2300	powers granted by law and may not be abrogated or restricted by
2301	any provisions in such municipality's or county's charter. A
2302	municipality or county issuing bonds for this purpose shall
2303	enter into such contracts with the Florida Insurance Guaranty
2304	Association or any entity acting on behalf of the Florida
2305	Insurance Guaranty Association as are necessary to implement the
2306	assistance program. Any bonds issued by a municipality or county
2307	or a combination thereof under this subsection shall be payable
2308	from and secured by moneys received by or on behalf of the
2309	municipality or county from assessments levied under s.
2310	631.57(3)(a) and assigned and pledged to or on behalf of the
2311	municipality or county for the benefit of the holders of the
2312	bonds in connection with the assistance program. The funds,
2313	credit, property, and taxing power of the state or any
2314	municipality or county shall not be pledged for the payment of
2315	such bonds.
2316	(6)  Two or more municipalities or counties, the residents
2317	of which have been substantially affected by a hurricane, may
2318	create a legal entity pursuant to s. 163.01(7)(g) to exercise
2319	the powers described in this section as well as those powers
2320	granted in s. 163.01(7)(g). References in this section to a
2321	municipality or county includes such legal entity.
2322	Section 24.  (1)  Notwithstanding section 9 of chapter
2323	2007-1, Laws of Florida, the internal design option provided in
2324	s. 1609.1.4.1. of the Florida Building Code shall remain in
2325	effect until June 1, 2007, for a building permit application
2326	made prior to that date.
2327	(2)  This section shall take effect upon this act becoming
2328	a law and shall apply retroactively to January 25, 2007. This
2329	section shall apply to any actions taken on any building permit
2330	affected by section 9 of chapter 2007-1, Laws of Florida,
2331	including any actions, legal or ministerial, pertaining to the
2332	issuance, revocation, or modifications of any building permit
2333	initiated or issued prior to, on, after, or pending as of
2334	January 25, 2007. If the retroactive application of any
2335	provision of this section is held invalid, the invalidity shall
2336	not affect the retroactive application of other provisions of
2337	this section.
2338	Section 25.  Except as otherwise expressly provided in this
2339	act, this act shall take effect July 1, 2007.
2340
2341	======= T I T L E  A M E N D M E N T =======
2342	Remove the entire title, and insert:
2343	A bill to be entitled
2344	An act relating to insurance; amending s. 163.01, F.S.;
2345	correcting a cross-reference; amending s. 215.555, F.S.;
2346	revising certain reimbursement contract requirements;
2347	deleting an expiration provision relating to obtaining
2348	coverage for liquidated insurers; delaying repeal of an
2349	exemption of medical malpractice insurance premiums from
2350	emergency assessments; revising criteria, requirements,
2351	and limitations on temporary emergency options for
2352	additional coverage under the Florida Hurricane
2353	Catastrophe Fund; amending s. 215.5595, F.S.; providing an
2354	exception to certain surplus note limitations for certain
2355	manufactured housing insurers; amending s. 624.407, F.S.;
2356	revising an insurer criterion for capital funds
2357	requirements for new insurers; amending s. 624.408, F.S.;
2358	specifying an additional surplus to policyholder amount
2359	requirement for certain insurers; amending s. 626.9201,
2360	F.S.; defining the term "nonpayment of premium"; providing
2361	additional criterion for cancellation for nonpayment of
2362	premium; amending s. 627.0613, F.S.; limiting application
2363	of certain annual report card preparation powers of the
2364	consumer advocate to personal residential property
2365	insurers; amending s. 627.062, F.S.; specifying
2366	application of certain "file and use" requirements to
2367	property insurance only; excluding certain motor vehicle
2368	coverages; amending s. 627.0655, F.S.; revising criteria
2369	for certain inclusion of discounts in certain premiums;
2370	amending s. 627.351, F.S.; revising legislative findings
2371	and intent; limiting application of the term "subject
2372	lines of business" to deficit assessments; revising a
2373	provision for determining eligibility of a risk for
2374	coverage; providing requirements for determining
2375	comparable coverage; revising requirements relating to
2376	senior management employees and members of the board of
2377	governors; revising provisions requiring the corporation
2378	to establish and maintain a fraudulent claims unit or
2379	division; revising rate filings provisions; amending s.
2380	627.3511, F.S.; correcting a cross-reference; amending s.
2381	627.3515, F.S.; revising criteria for an electronic
2382	database for a business plan; amending s. 627.3517, F.S.;
2383	deleting a provision specifying nonapplication for a
2384	certain period; amending s. 627.4035, F.S.; revising a
2385	premium payment plan option provision for certain
2386	insurers; amending s. 627.4133, F.S.; specifying
2387	requirements for notices of renewal premium of property
2388	insurance policies; authorizing the Financial Services
2389	Commission to adopt rules; amending s. 627.701, F.S.;
2390	revising requirements for deductibles for certain personal
2391	lines residential property insurance policies; amending s.
2392	627.70131, F.S.; revising certain payment or denial of
2393	claim requirements; requiring an insurer to pay or deny a
2394	claim within a certain time period; providing requirements
2395	for payment of interest on overdue claims; prohibiting
2396	contractual waivers, voidances, or nullifications;
2397	specifying regulatory action as an exclusive remedy for
2398	certain violations; amending s. 627.712, F.S.; limiting
2399	application of certain residential hurricane coverage
2400	requirements to property insurance policies; specifying
2401	separate coverage exclusion statements for policyholders
2402	that are natural persons and other than natural persons;
2403	specifying a period of application of certain exclusions;
2404	providing for implementation of changes to certain
2405	exclusions; amending s. 627.713, F.S.; prohibiting the
2406	office from requiring property insurers to report certain
2407	claims and payment data for a particular year until the
2408	following year; amending s. 627.7277, F.S.; deleting
2409	certain notice of renewal premium requirements; deleting
2410	authority of the commission to adopt rules; amending s.
2411	631.52, F.S.; expanding an exception to application to
2412	self insurance of provisions relating to Florida Insurance
2413	Guaranty of Payment; amending s. 631.57, F.S.; revising
2414	certain emergency assessment provisions relating to
2415	insurers rendered insolvent by the effects of hurricanes;
2416	amending s. 631.695, F.S.; deleting provisions limiting
2417	application of certain revenue bond issuance authority to
2418	certain counties; preserving certain Florida Building Code
2419	internal design options for certain building permits for a
2420	certain time; providing for retroactive application;
2421	providing severability; providing effective dates.

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