1 | A bill to be entitled |
2 | An act relating to property insurance; authorizing the |
3 | State Board of Administration to sell reinsurance to |
4 | private insurance companies taking insurance policies from |
5 | Citizens Property Insurance Corporation under certain |
6 | circumstances; providing for a discount to policyholders |
7 | of Citizens Property Insurance Corporation; authorizing |
8 | the State Board of Administration to offer discounted |
9 | reinsurance rates to private insurance companies under |
10 | certain circumstances; authorizing the State Board of |
11 | Administration to determine the number of policies taken |
12 | from Citizens Property Insurance Corporation to get |
13 | discounted reinsurance; providing requirements for private |
14 | insurance companies to get a discounted reinsurance rate; |
15 | providing an effective date. |
16 |
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17 | WHEREAS, in the 2007A Special Session, the Legislature |
18 | enacted HB 1A, which will result in only modest rate reductions |
19 | for Citizens Property Insurance Corporation's customers on a |
20 | short-term, nonpermanent basis, and the corporation was not |
21 | relieved of its overly large population, and |
22 | WHEREAS, more reforms must be enacted using market forces |
23 | by providing incentives to private carriers to offer affordable |
24 | insurance to the corporation's customers in return for |
25 | inexpensive reinsurance from the state, so that the corporation |
26 | would return to being an insurance company of last resort, NOW, |
27 | THEREFORE, |
28 |
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29 | Be It Enacted by the Legislature of the State of Florida: |
30 |
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31 | Section 1. (1) The State Board of Administration may sell |
32 | reinsurance below the $6 billion retention level in the Florida |
33 | Hurricane Catastrophe Fund within the range of 30 to 60 percent |
34 | online to private insurance companies that agree to take out of |
35 | Citizens Property Insurance Corporation a specified number of |
36 | individual policies held by Citizens Property Insurance |
37 | Corporation on a geographically diverse basis. |
38 | (2) Policyholders of Citizens Property Insurance |
39 | Corporation must receive a discount no less than a rate |
40 | specified by the State Board of Administration, which must be no |
41 | less than 10 percent. |
42 | (3) The State Board of Administration may offer discounted |
43 | reinsurance rates to private insurance companies through offers |
44 | to negotiate via auction, individual negotiation, or any method |
45 | designed to achieve the best discounted rate for policyholders |
46 | of Citizens Property Insurance Corporation. |
47 | (4) The State Board of Administration may determine how |
48 | many policies a private company must assume from Citizens |
49 | Property Insurance Corporation in order to purchase reinsurance |
50 | from the state at the discounted rate. |
51 | (5) Private insurance companies must assume 100 percent of |
52 | each policy taken from Citizens Property Insurance Corporation |
53 | in exchange for the discounted reinsurance rate. |
54 | Section 2. This act shall take effect upon becoming a law. |