CS/HB 1A

1	A bill to be entitled
2	An act relating to hurricane preparedness and insurance;
3	amending s. 163.01, F.S., relating to the Florida
4	Interlocal Cooperation Act; redefining the term "public
5	agency" to include certain legal or administrative
6	entities; authorizing such entities to finance the
7	provision of property coverage contracts for or from local
8	government property insurance pools or property coverage
9	contracts; providing a definition; authorizing certain
10	hospitals to jointly issue bonds to finance windstorm
11	coverages and claims; granting authority to individual
12	hospitals and teaching hospitals to jointly issue bond
13	anticipation notes; authorizing validation of bonds issued
14	to certain hospital entities; specifying that a hospital's
15	immunity caps are not waived through issuance of bonds to
16	pay windstorm coverage or claims; amending s. 215.555,
17	F.S., relating to the Florida Hurricane Catastrophe Fund;
18	revising certain provisions of the reimbursement contracts
19	for insurers; deleting a rapid cash buildup requirement
20	from a reimbursement premium formula factor; expanding the
21	State Board of Administration's reinsurance procurement
22	powers and duties for certain purposes; providing for
23	temporary emergency options for additional coverage and
24	for temporary increase in coverage limit options;
25	providing legislative findings and intent; providing for
26	application of certain provisions; providing additional
27	definitions; providing for a reimbursement contract
28	addendum for certain insurers; providing requirements and
29	procedures under the addendum; providing for certain
30	reimbursement premiums for such insurers; providing for
31	calculation of such premiums; providing for effect on
32	claims-paying capacity of fund; requiring insurers
33	electing optional coverages offered by the Florida
34	Hurricane Catastrophe Fund to make rate filings that
35	reflect savings or reduction in loss exposure; requiring
36	that the Office of Insurance Regulation specify, by order,
37	the dates on which such filings must be made; requiring
38	certain insurers to make additional rate filings;
39	specifying rate filing requirements; amending s. 215.5586,
40	F.S.; revising criteria for wind certification and
41	hurricane mitigation inspectors; requiring a level 2
42	background check for wind certification and hurricane
43	mitigation inspectors; authorizing the Department of
44	Financial Services to conduct criminal records checks of
45	inspectors; requiring payment of fingerprint processing
46	fees; revising certain financial wind certification and
47	mitigation grant criteria and use provisions; providing
48	additional uses for grant funding for certain homeowners;
49	authorizing the department to contract with not-for-profit
50	corporations to conduct the Florida Comprehensive
51	Hurricane Damage Mitigation Program and enhance awareness
52	of the benefits of mitigation; requiring the department to
53	develop and maintain a list of wind certification and
54	hurricane mitigation inspectors; amending s. 215.5595,
55	F.S.; including manufactured housing insurers in the
56	Insurance Capital Build-Up Incentive Program; providing
57	manufactured housing insurer program contribution
58	requirements; providing surplus requirements; prioritizing
59	funding for manufactured housing insurers; providing
60	premium to surplus ratio requirements for certain
61	manufactured housing insurers; creating s. 395.106, F.S.;
62	authorizing certain hospitals and hospital systems to pool
63	and spread windstorm property exposure risk among members;
64	providing criteria for participation; providing
65	definitions; subjecting alliances not in compliance with
66	risk-pooling requirements to the Insurance Code; excluding
67	an alliance meeting provision requirements from
68	participation in or coverage by an insurance guaranty
69	association established by ch. 631, F.S.; amending s.
70	553.73, F.S.; prohibiting the Florida Building Commission
71	from modifying certain foundation codes relating to wind
72	resistance or the prevention of water intrusion unless the
73	modification enhances such provisions; amending s.
74	553.775, F.S., relating to interpretations of the Florida
75	Building Code; conforming a cross-reference; requiring
76	jurisdictions having authority to enforce the Florida
77	Building Code to require wind-borne-debris protection
78	according to specified requirements; requiring that the
79	Florida Building Commission amend the Florida Building
80	Code to reflect the requirements of the act and eliminate
81	certain less stringent requirements; providing an
82	exception; requiring the commission to develop voluntary
83	guidelines for increasing the hurricane resistance of
84	buildings; requiring that the guidelines be included in
85	the commission's report to the 2008 Legislature; amending
86	s. 624.407, F.S., relating to capitalization requirements
87	for insurers writing property insurance; specifying
88	certain minimum surplus amounts; prohibiting insurers
89	writing private passenger automobile insurance from
90	writing such insurance under certain circumstances;
91	amending s. 624.462, F.S.; revising requirements for the
92	establishment of a commercial self-insurance fund by a
93	not-for-profit group; amending s. 624.4622, F.S.;
94	authorizing local government self-insurance funds to
95	insure or self-insure real or personal property against
96	loss or damage; creating s. 624.4625, F.S.; authorizing
97	two or more corporations not for profit to form a self-
98	insurance fund for certain purposes; providing specific
99	requirements; providing a definition; providing
100	limitations; providing for application of certain
101	provisions to certain premiums, contributions, and
102	assessments; providing for payment of insurance premium
103	tax at a reduced rate by corporation not-for-profit self-
104	insurance funds; subjecting a corporation not for profit
105	self-insurance fund to certain group self-insurance fund
106	provisions under certain circumstances; amending s.
107	624.610, F.S.; prescribing responsibilities of the
108	Commissioner of Insurance Regulation relating to allowing
109	credit for reinsurance; amending s. 626.2815, F.S.;
110	requiring continuing education for certain agents and
111	customer representatives on the subject of premium
112	discounts for hurricane mitigation options; amending s.
113	627.0613, F.S.; providing additional duties of the
114	consumer advocate; amending s. 627.062, F.S.; requiring
115	that an insurer make a "file and use" filing under certain
116	circumstances; deleting provisions exempting certain rate
117	filings from review by the Office of Insurance Regulation;
118	requiring certain rate filings to account for certain
119	mitigation measures; requiring the chief executive
120	officer, chief financial officer, or chief actuary of a
121	property insurer to certify the information contained in a
122	rate filing; providing penalties for knowingly making a
123	false certification; authorizing the Financial Services
124	Commission to adopt rules; amending s. 627.0629, F.S.;
125	providing legislative intent relating to savings to
126	customers for windstorm mitigation efforts; providing for
127	reductions in deductibles for mitigation measures;
128	creating s. 627.0655, F.S.; authorizing insurers to
129	provide certain premium discounts under certain
130	circumstances; amending s. 627.351, F.S., relating to the
131	Citizens Property Insurance Corporation; deleting
132	provisions that deny certain nonhomestead property
133	eligibility for coverage by the corporation; including
134	commercial nonresidential policies into an account of the
135	corporation; authorizing the corporation to issue
136	multiperil coverage and continue to offer wind-only
137	coverage in the high-risk account after a specified date;
138	deleting provisions authorizing the Office of Insurance
139	Regulation to remove territory from the area eligible for
140	wind-only and quota share coverage; requiring the board of
141	governors of the corporation to levy an assessment against
142	nonhomestead property policyholders if certain deficits
143	occur after a specified date; restricting the eligibility
144	of a risk for a policy issued by the corporation under
145	certain circumstances; authorizing the plan of operation
146	to establish limits of coverage and to require commercial
147	property to meet specified hurricane-mitigation features;
148	requiring that the corporation annually file recommended
149	rates; requiring that the office issue a final order
150	establishing the rates within a specified period;
151	prohibiting the corporation from pursuing administrative
152	or judicial review of such order; deleting provisions
153	specifying circumstances under which a rate is deemed
154	inadequate; deleting legislative intent concerning rate
155	adequacy in the residual market; deleting provisions
156	providing requirements for personal lines residential
157	policies and residential wind-only policies; deleting an
158	exemption provided for coverage provided by the
159	corporation in Monroe County under certain circumstances;
160	deleting a requirement that the corporation certify to the
161	office that its rates comply with certain requirements;
162	deleting a requirement for a notice to policyholders and
163	applicants; rescinding certain rate filings by the
164	corporation which took effect January 1, 2007; reinstating
165	certain rates in effect on December 31, 2006; clarifying
166	the effect of a policy that is taken out, assumed, or
167	removed from the corporation; providing legislative intent
168	that commercial nonresidential property insurance be made
169	available from Citizens Property Insurance Corporation;
170	requiring that Citizens Property Insurance Corporation
171	adopt a plan providing for the transition of such coverage
172	from the Property and Casualty Joint Underwriting
173	Association to Citizens; providing requirements for the
174	plan; amending s. 627.3515, F.S.; requiring Citizens
175	Property Insurance Corporation to develop a business plan,
176	which must be approved by the commission; providing that
177	an insurer is not liable and there is no cause of action
178	against an insurer acting within the scope of its
179	authority; amending s. 627.4035, F.S.; requiring insurers
180	to provide certain premium payment plan options to
181	policyholders; requiring prior approval of such plans by
182	the office; amending s. 627.4133, F.S.; increasing a
183	period of notice for nonrenewals, cancellations, and
184	terminations; requiring residential property insurers to
185	return excess profits to policyholders except as directed
186	by the Office of Insurance Regulation; providing a formula
187	for determining excess profits; transferring, renumbering,
188	and amending s. 627.4261, F.S.; requiring insurers to pay
189	or deny certain claims within a time certain; providing an
190	exception; providing penalties; amending s. 627.701, F.S.;
191	requiring insurers to provide insureds options for certain
192	deductibles, credits, or rate differentials; creating s.
193	627.7018, F.S.; providing a prohibition and requirements
194	for insurers in denying coverage; amending s. 627.706,
195	F.S., relating to sinkhole insurance; defining the term
196	"catastrophic ground cover collapse"; requiring property
197	insurers to provide coverage for catastrophic ground cover
198	collapse; allowing property insurers to charge an
199	appropriate additional premium for coverage for sinkhole
200	loss; specifying the date on which coverage for
201	catastrophic ground cover collapse may take effect;
202	requiring insurers offering policies that exclude coverage
203	for sinkhole losses to provide notice to policyholders;
204	amending s. 627.711, F.S.; requiring certain notices to
205	specify combinations of discounts, credits, rate
206	differentials, and reductions in deductibles; requiring
207	the Financial Services Commission to develop uniform
208	mitigation verification inspection forms; providing duties
209	of the commission; creating s. 627.712, F.S.; requiring
210	insurers issuing residential property insurance to provide
211	hurricane or windstorm coverage; authorizing a
212	policyholder to make a written rejection of such coverage
213	by signing a statement acknowledging the lack of insurance
214	or providing a statement from the mortgageholder or
215	lienholder; requiring insurers issuing residential
216	property insurance to make available an exclusion of
217	coverage for contents; providing for the policyholder to
218	make a written rejection of such coverage; requiring that
219	the insurer keep documentation of such statements;
220	requiring the Financial Services Commission to adopt
221	rules; creating s. 627.713, F.S.; authorizing the office
222	to require property insurers to report data regarding
223	hurricane claims and underwriting costs; amending s.
224	627.7277, F.S.; requiring certain information to be
225	included in notices of renewal premium; providing for
226	rules; amending s. 631.57, F.S.; revising criteria and
227	requirements for levy of emergency assessments by the
228	Florida Insurance Guaranty Association; revising
229	characterizations of emergency assessments; providing
230	legislative intent; amending s. 718.111, F.S.; providing
231	for windstorm insurance for condominium associations;
232	creating the Task Force on Citizens Property Insurance
233	Claims Handling and Resolution; providing for
234	administration of the task force; providing for
235	membership; providing for reimbursement of expenses but no
236	compensation; providing purpose and intent; requiring the
237	task force to address certain issues; requiring reports
238	and recommendations; providing additional responsibilities
239	of the task force; providing for expiration of the task
240	force; creating the Windstorm Mitigation Study Committee
241	for the purpose of analyzing solutions and programs that
242	could address the state's need to mitigate the effects of
243	windstorms on structures; providing for membership and
244	qualifications; providing that the members are entitled to
245	reimbursement for expenses incurred in connection with
246	their duties; providing for reimbursement of travel
247	expenses; requiring the Department of Financial Services,
248	the Office of Insurance Regulation, the Citizens Property
249	Insurance Corporation, and other state agencies to supply
250	information, assistance, and facilities to the committee;
251	requiring the department to provide staff assistance;
252	specifying duties of the committee; requiring the
253	committee to report to the Governor, the Legislature, the
254	Chief Financial Officer, and the Commissioner of Insurance
255	Regulation by a specified date; providing for expiration
256	of the committee; requiring the Financial Services
257	Commission to adopt a uniform home grading scale for
258	certain purposes; providing criteria; requiring the
259	Department of Community Affairs to implement the 2006
260	Disaster Recovery Program for the purpose of assisting
261	local governments in hardening low-income housing against
262	the effects of hurricanes; specifying that the act does
263	not create an entitlement or obligate the state; providing
264	for program administration; specifying the entities that
265	are eligible to apply for funding; providing for the use
266	of funds under the program; prohibiting insurers writing
267	private passenger automobile insurance from writing such
268	insurance under certain circumstances; expressing the
269	intent of the Legislature to create a grant program to
270	assist low-income persons in purchasing property
271	insurance; repealing s. 627.0629(6), F.S., relating to
272	certain limitations on writing residential property
273	insurance; providing appropriations; providing for
274	severability; providing effective dates.
275	WHEREAS, homeowners in the State of Florida are
276	struggling under increased insurance costs and increased
277	housing prices as a result of damage caused by hurricanes
278	and tropical storms, and
279	WHEREAS, this increase in the cost of property
280	insurance for the state's residents demands immediate
281	attention, and
282	WHEREAS, the affordability of property insurance
283	creates financial burdens for Florida's residents and
284	financial crises for some property owners, and
285	WHEREAS, in addition to affordability, the
286	availability and stability of property insurance rates are
287	critical issues to the residents of this state, and
288	WHEREAS, because there is no single, quick, or easy
289	solution to the current crisis, a comprehensive and
290	creative approach is required, and
291	WHEREAS, property insurance is so interwoven with
292	other forms of insurance, through business, regulation,
293	advocacy, purchasing, and other interactions, that the
294	viability of the insurance market in Florida is at risk,
295	and
296	WHEREAS, expanding coverage offered by the Florida
297	Hurricane Catastrophe Fund can help to address this
298	crisis, and
299	WHEREAS, taking steps to control or reduce the
300	premiums charged by Citizens Property Insurance
301	Corporation can help to address this crisis, and
302	WHEREAS, strengthening the Florida Building Code and
303	providing for voluntary guidelines in addition to the
304	requirements of the code can help to address this crisis,
305	and
306	WHEREAS, sinkhole coverage is a critical part of the
307	crisis in certain areas of the state and must be addressed
308	as part of any comprehensive solution, and
309	WHEREAS, requiring property insurers to offer
310	additional deductibles and exclusions that apply at the
311	option of the property owner can help to address this
312	crisis, and
313	WHEREAS, authorizing various groups of public and
314	private entities to enter into forms of self-insurance or
315	guaranty groups can help to address this crisis, and
316	WHEREAS, strengthening the processes for establishing
317	property insurance rates can help to address this crisis,
318	and
319	WHEREAS, the role of consumer advocacy is a critical
320	part of addressing this crisis and consumer advocacy for
321	property insurance is a critical, if not the predominant,
322	part of consumer advocacy regarding insurance, and
323	WHEREAS, promoting, through financial and regulatory
324	methods, the ability of property insurers and reinsurers
325	to do business in Florida can help to address this crisis,
326	and
327	WHEREAS, promoting, through financial and regulatory
328	incentives for property owners, the strengthening of
329	property to withstand the effects of windstorm damage can
330	help to address this crisis, NOW, THEREFORE,
331
332	Be It Enacted by the Legislature of the State of Florida:
333
334	Section 1.  Paragraph (b) of subsection (3) and paragraph
335	(e) of subsection (7) of section 163.01, Florida Statutes, are
336	amended, and paragraph (h) is added to subsection (7) of that
337	section, to read:
338	163.01  Florida Interlocal Cooperation Act of 1969.--
339	(3)  As used in this section:
340	(b)  "Public agency" means a political subdivision, agency,
341	or officer of this state or of any state of the United States,
342	including, but not limited to, state government, county, city,
343	school district, single and multipurpose special district,
344	single and multipurpose public authority, metropolitan or
345	consolidated government, a separate legal entity or
346	administrative entity created under subsection (7), an
347	independently elected county officer, any agency of the United
348	States Government, a federally recognized Native American tribe,
349	and any similar entity of any other state of the United States.
350	(7)
351	(e)1.  Notwithstanding the provisions of paragraph (c), any
352	separate legal entity, created pursuant to the provisions of
353	this section and controlled by counties or municipalities of
354	this state, the membership of which consists or is to consist
355	only of public agencies of this state, may, for the purpose of
356	financing the provision or acquisition of liability or property
357	coverage contracts for or from one or more local government
358	liability or property pools to provide liability or property
359	coverage for counties, municipalities, or other public agencies
360	of this state, exercise all powers in connection with the
361	authorization, issuance, and sale of bonds. All of the
362	privileges, benefits, powers, and terms of s. 125.01 relating to
363	counties and s. 166.021 relating to municipalities shall be
364	fully applicable to such entity and such entity shall be
365	considered a unit of local government for all of the privileges,
366	benefits, powers, and terms of part I of chapter 159.  Bonds
367	issued by such entity shall be deemed issued on behalf of
368	counties, municipalities, or public agencies which enter into
369	loan agreements with such entity as provided in this paragraph.
370	Proceeds of bonds issued by such entity may be loaned to
371	counties, municipalities, or other public agencies of this
372	state, whether or not such counties, municipalities, or other
373	public agencies are also members of the entity issuing the
374	bonds, and such counties, municipalities, or other public
375	agencies may in turn deposit such loan proceeds with a separate
376	local government liability or property pool for purposes of
377	providing or acquiring liability or property coverage contracts.
378	2.  Counties or municipalities of this state are authorized
379	pursuant to this section, in addition to the authority provided
380	by s. 125.01, part II of chapter 166, and other applicable law,
381	to issue bonds for the purpose of acquiring liability coverage
382	contracts from a local government liability pool. Any individual
383	county or municipality may, by entering into interlocal
384	agreements with other counties, municipalities, or public
385	agencies of this state, issue bonds on behalf of itself and
386	other counties, municipalities, or other public agencies, for
387	purposes of acquiring a liability coverage contract or contracts
388	from a local government liability pool. Counties,
389	municipalities, or other public agencies are also authorized to
390	enter into loan agreements with any entity created pursuant to
391	subparagraph 1., or with any county or municipality issuing
392	bonds pursuant to this subparagraph, for the purpose of
393	obtaining bond proceeds with which to acquire liability coverage
394	contracts from a local government liability pool. No county,
395	municipality, or other public agency shall at any time have more
396	than one loan agreement outstanding for the purpose of obtaining
397	bond proceeds with which to acquire liability coverage contracts
398	from a local government liability pool. Obligations of any
399	county, municipality, or other public agency of this state
400	pursuant to a loan agreement as described above may be validated
401	as provided in chapter 75.  Prior to the issuance of any bonds
402	pursuant to subparagraph 1. or this subparagraph for the purpose
403	of acquiring liability coverage contracts from a local
404	government liability pool, the reciprocal insurer or the manager
405	of any self-insurance program shall demonstrate to the
406	satisfaction of the Office of Insurance Regulation of the
407	Financial Services Commission that excess liability coverage for
408	counties, municipalities, or other public agencies is reasonably
409	unobtainable in the amounts provided by such pool or that the
410	liability coverage obtained through acquiring contracts from a
411	local government liability pool, after taking into account costs
412	of issuance of bonds and any other administrative fees, is less
413	expensive to counties, municipalities, or special districts than
414	similar commercial coverage then reasonably available.
415	3.  Any entity created pursuant to this section or any
416	county or municipality may also issue bond anticipation notes,
417	as provided by s. 215.431, in connection with the authorization,
418	issuance, and sale of such bonds.  In addition, the governing
419	body of such legal entity or the governing body of such county
420	or municipality may also authorize bonds to be issued and sold
421	from time to time and may delegate, to such officer, official,
422	or agent of such legal entity as the governing body of such
423	legal entity may select, the power to determine the time; manner
424	of sale, public or private; maturities; rate or rates of
425	interest, which may be fixed or may vary at such time or times
426	and in accordance with a specified formula or method of
427	determination; and other terms and conditions as may be deemed
428	appropriate by the officer, official, or agent so designated by
429	the governing body of such legal entity. However, the amounts
430	and maturities of such bonds and the interest rate or rates of
431	such bonds shall be within the limits prescribed by the
432	governing body of such legal entity and its resolution
433	delegating to such officer, official, or agent the power to
434	authorize the issuance and sale of such bonds.  Any series of
435	bonds issued pursuant to this paragraph for liability coverage
436	shall mature no later than 7 years following the date of
437	issuance thereof. A series of bonds issued pursuant to this
438	paragraph for property coverage shall mature no later than 30
439	years following the date of issuance.
440	4.  Bonds issued pursuant to subparagraph 1. may be
441	validated as provided in chapter 75.  The complaint in any
442	action to validate such bonds shall be filed only in the Circuit
443	Court for Leon County.  The notice required to be published by
444	s. 75.06 shall be published in Leon County and in each county
445	which is an owner of the entity issuing the bonds, or in which a
446	member of the entity is located, and the complaint and order of
447	the circuit court shall be served only on the State Attorney of
448	the Second Judicial Circuit and on the state attorney of each
449	circuit in each county or municipality which is an owner of the
450	entity issuing the bonds or in which a member of the entity is
451	located.
452	5.  Bonds issued pursuant to subparagraph 2. may be
453	validated as provided in chapter 75. The complaint in any action
454	to validate such bonds shall be filed in the circuit court of
455	the county or municipality which will issue the bonds.  The
456	notice required to be published by s. 75.06 shall be published
457	only in the county where the complaint is filed, and the
458	complaint and order of the circuit court shall be served only on
459	the state attorney of the circuit in the county or municipality
460	which will issue the bonds.
461	6.  The participation by any county, municipality, or other
462	public agency of this state in a local government liability pool
463	shall not be deemed a waiver of immunity to the extent of
464	liability coverage, nor shall any contract entered regarding
465	such a local government liability pool be required to contain
466	any provision for waiver.
467	(h)1.  Notwithstanding the provisions of paragraph (c), any
468	separate legal entity consisting of an alliance, as defined in
469	s. 395.106(2)(a), created pursuant to this paragraph and
470	controlled by and whose members consist of eligible entities
471	comprised of special districts created pursuant to a special act
472	and having the authority to own or operate one or more hospitals
473	licensed in this state or hospitals licensed in this state that
474	are owned, operated, or funded by a county or municipality, for
475	the purpose of providing property insurance coverage as defined
476	in s. 395.106(2)(c), for such eligible entities, may exercise
477	all powers under this subsection in connection with borrowing
478	funds for such purposes, including, without limitation, the
479	authorization, issuance, and sale of bonds, notes, or other
480	obligations of indebtedness. Borrowed funds, including, but not
481	limited to, bonds issued by such alliance shall be deemed issued
482	on behalf of such eligible entities that enter into loan
483	agreements with such separate legal entity as provided in this
484	paragraph.
485	2.  Any such separate legal entity shall have all the
486	powers that are provided by the interlocal agreement under which
487	the entity is created or that are necessary to finance, operate,
488	or manage the alliance's property insurance coverage program.
489	Proceeds of bonds, notes, or other obligations issued by such an
490	entity may be loaned to any one or more eligible entities. Such
491	eligible entities are authorized to enter into loan agreements
492	with any separate legal entity created pursuant to this
493	paragraph for the purpose of obtaining moneys with which to
494	finance property insurance coverage or claims. Obligations of
495	any eligible entity pursuant to a loan agreement as described in
496	this paragraph may be validated as provided in chapter 75.
497	3.  Any bonds, notes, or other obligations to be issued or
498	incurred by a separate legal entity created pursuant to this
499	paragraph shall be authorized by resolution of the governing
500	body of such entity and bear the date or dates; mature at the
501	time or times, not exceeding 30 years from their respective
502	dates; bear interest at the rate or rates, which may be fixed or
503	vary at such time or times and in accordance with a specified
504	formula or method of determination; be payable at the time or
505	times; be in the denomination; be in the form; carry the
506	registration privileges; be executed in the manner; be payable
507	from the sources and in the medium of payment and at the place;
508	and be subject to redemption, including redemption prior to
509	maturity, as the resolution may provide. The bonds, notes, or
510	other obligations may be sold at public or private sale for such
511	price as the governing body of the separate legal entity shall
512	determine. The bonds may be secured by such credit enhancement,
513	if any, as the governing body of the separate legal entity deems
514	appropriate. The bonds may be secured by an indenture of trust
515	or trust agreement. In addition, the governing body of the
516	separate legal entity may delegate, to such officer or official
517	of such entity as the governing body may select, the power to
518	determine the time; manner of sale, public or private;
519	maturities; rate or rates of interest, which may be fixed or may
520	vary at such time or times and in accordance with a specified
521	formula or method of determination; and other terms and
522	conditions as may be deemed appropriate by the officer or
523	official so designated by the governing body of such separate
524	legal entity. However, the amounts and maturities of such bonds,
525	the interest rate or rates, and the purchase price of such bonds
526	shall be within the limits prescribed by the governing body of
527	such separate legal entity in its resolution delegating to such
528	officer or official the power to authorize the issuance and sale
529	of such bonds.
530	4.  Bonds issued pursuant to this paragraph may be
531	validated as provided in chapter 75. The complaint in any action
532	to validate such bonds shall be filed only in the Circuit Court
533	for Leon County. The notice required to be published by s. 75.06
534	shall be published in Leon County and in each county in which an
535	eligible entity that is a member of an alliance is located. The
536	complaint and order of the circuit court shall be served only on
537	the state attorney of the Second Judicial Circuit and on the
538	state attorney of each circuit in each county in which an
539	eligible entity receiving bond proceeds is located.
540	5.  The accomplishment of the authorized purposes of a
541	separate legal entity created under this paragraph is deemed in
542	all respects for the benefit, increase of the commerce and
543	prosperity, and improvement of the health and living conditions
544	of the people of this state. Inasmuch as the separate legal
545	entity performs essential public functions in accomplishing its
546	purposes, the separate legal entity is not required to pay any
547	taxes or assessments of any kind upon any property acquired or
548	used by the entity for such purposes or upon any revenues at any
549	time received by the entity. The bonds, notes, and other
550	obligations of such separate legal entity, the transfer of and
551	income from such bonds, notes, and other obligations, including
552	any profits made on the sale of such bonds, notes, and other
553	obligations, are at all times free from taxation of any kind of
554	the state or by any political subdivision or other agency or
555	instrumentality if the state. The exemption granted in this
556	paragraph does not apply to any tax imposed by chapter 220 on
557	interest, income, or profits on debt obligations owned by
558	corporations.
559	6.  The participation by any eligible entity in an alliance
560	or a separate legal entity created pursuant to this paragraph
561	may not be deemed a waiver of immunity to the extent of
562	liability or any other coverage and a contract entered regarding
563	such alliance is not required to contain any provision for
564	waiver.
565	Section 2.  Paragraphs (b), (c), and (d) of subsection (4),
566	paragraph (b) of subsection (5), and paragraph (a) of subsection
567	(7) of section 215.555, Florida Statutes, are amended, and
568	subsections (16) and (17) are added to that section, to read:
569	215.555  Florida Hurricane Catastrophe Fund.--
570	(4)  REIMBURSEMENT CONTRACTS.--
571	(b)1.  The contract shall contain a promise by the board to
572	reimburse the insurer for 45 percent, 75 percent, or 90 percent
573	of its losses from each covered event in excess of the insurer's
574	retention, plus 5 percent of the reimbursed losses to cover loss
575	adjustment expenses.
576	2.  The insurer must elect one of the percentage coverage
577	levels specified in this paragraph and may, upon renewal of a
578	reimbursement contract, elect a lower percentage coverage level
579	if no revenue bonds issued under subsection (6) after a covered
580	event are outstanding, or elect a higher percentage coverage
581	level, regardless of whether or not revenue bonds are
582	outstanding. All members of an insurer group must elect the same
583	percentage coverage level.  Any joint underwriting association,
584	risk apportionment plan, or other entity created under s.
585	627.351 must elect the 90-percent coverage level.
586	3.  The contract shall provide that reimbursement amounts
587	shall not be reduced by reinsurance paid or payable to the
588	insurer from other sources.
589	4.  Notwithstanding any other provision contained in this
590	section, the board shall make available to insurers that
591	participated in 2006, insurers qualifying as limited
592	apportionment companies under s. 627.351(6)(c) which began
593	writing property insurance in 2007, and insurers that were
594	approved to participate in 2006 or that are approved in 2007 for
595	the Insurance Capital Build-Up Incentive Program pursuant to s.
596	215.5595, a contract or contract addendum that provides an
597	additional amount of reimbursement coverage of up to $10
598	million. The premium to be charged for this additional
599	reimbursement coverage shall be 50 percent of the additional
600	reimbursement coverage provided, which shall include one prepaid
601	reinstatement. The minimum retention level that an eligible
602	participating insurer must retain associated with this
603	additional coverage layer is 30 percent of the insurer's surplus
604	as of December March 31, 2006. This coverage shall be in
605	addition to all other coverage that may be provided under this
606	section. The coverage provided by the fund under this subsection
607	shall be in addition to the claims-paying capacity as defined in
608	subparagraph (c)1., but only with respect to those insurers that
609	select the additional coverage option and meet the requirements
610	of this subsection. The claims-paying capacity with respect to
611	all other participating insurers and limited apportionment
612	companies that do not select the additional coverage option
613	shall be limited to their reimbursement premium's proportionate
614	share of the actual claims-paying capacity otherwise defined in
615	subparagraph (c)1. and as provided for under the terms of the
616	reimbursement contract. Coverage provided in the reimbursement
617	contract for participating insurers will not be affected by the
618	additional premiums paid by participating insurers limited
619	apportionment companies exercising the additional coverage
620	option allowed in this subparagraph. This subparagraph expires
621	on May 31, 2008 2007.
622	(c)1.  The contract shall also provide that the obligation
623	of the board with respect to all contracts covering a particular
624	contract year shall not exceed the actual claims-paying capacity
625	of the fund up to a limit of $15 billion for that contract year
626	adjusted based upon the reported exposure from the prior
627	contract year to reflect the percentage growth in exposure to
628	the fund for covered policies since 2003, provided the dollar
629	growth in the limit may not increase in any year by an amount
630	greater than the dollar growth of the balance of the fund as of
631	December 31, less any premiums or interest attributable to
632	optional coverage, as defined by rule which occurred over the
633	prior calendar year.
634	2.  In May before the start of the upcoming contract year
635	and in October during the contract year, the board shall publish
636	in the Florida Administrative Weekly a statement of the fund's
637	estimated borrowing capacity and the projected balance of the
638	fund as of December 31. After the end of each calendar year, the
639	board shall notify insurers of the estimated borrowing capacity
640	and the balance of the fund as of December 31 to provide
641	insurers with data necessary to assist them in determining their
642	retention and projected payout from the fund for loss
643	reimbursement purposes. In conjunction with the development of
644	the premium formula, as provided for in subsection (5), the
645	board shall publish factors or multiples that assist insurers in
646	determining their retention and projected payout for the next
647	contract year. For all regulatory and reinsurance purposes, an
648	insurer may calculate its projected payout from the fund as its
649	share of the total fund premium for the current contract year
650	multiplied by the sum of the projected balance of the fund as of
651	December 31 and the estimated borrowing capacity for that
652	contract year as reported under this subparagraph.
653	(d)1.  For purposes of determining potential liability and
654	to aid in the sound administration of the fund, the contract
655	shall require each insurer to report such insurer's losses from
656	each covered event on an interim basis, as directed by the
657	board. The contract shall require the insurer to report to the
658	board no later than December 31 of each year, and quarterly
659	thereafter, its reimbursable losses from covered events for the
660	year. The contract shall require the board to determine and pay,
661	as soon as practicable after receiving these reports of
662	reimbursable losses, the initial amount of reimbursement due and
663	adjustments to this amount based on later loss information. The
664	adjustments to reimbursement amounts shall require the board to
665	pay, or the insurer to return, amounts reflecting the most
666	recent calculation of losses.
667	2.  In determining reimbursements pursuant to this
668	subsection, the contract shall provide that the board shall:
669	a.  Next pay to each insurer such insurer's projected
670	payout, which is the amount of reimbursement it is owed, up to
671	an amount equal to the insurer's share of the actual premium
672	paid for that contract year, multiplied by the actual claims-
673	paying capacity available for that contract year; provided,
674	entities created pursuant to s. 627.351 shall be further
675	reimbursed in accordance with sub-subparagraph b.
676	b.  Thereafter, establish the prorated reimbursement level
677	at the highest level for which any remaining fund balance or
678	bond proceeds are sufficient to reimburse entities created
679	pursuant to s. 627.351 based on reimbursable losses exceeding
680	the amounts payable pursuant to sub-subparagraph a. for the
681	current contract year.
682	(5)  REIMBURSEMENT PREMIUMS.--
683	(b)  The State Board of Administration shall select an
684	independent consultant to develop a formula for determining the
685	actuarially indicated premium to be paid to the fund. The
686	formula shall specify, for each zip code or other limited
687	geographical area, the amount of premium to be paid by an
688	insurer for each $1,000 of insured value under covered policies
689	in that zip code or other area. In establishing premiums, the
690	board shall consider the coverage elected under paragraph (4)(b)
691	and any factors that tend to enhance the actuarial
692	sophistication of ratemaking for the fund, including
693	deductibles, type of construction, type of coverage provided,
694	relative concentration of risks, and other such factors deemed
695	by the board to be appropriate. The formula may provide for a
696	procedure to determine the premiums to be paid by new insurers
697	that begin writing covered policies after the beginning of a
698	contract year, taking into consideration when the insurer starts
699	writing covered policies, the potential exposure of the insurer,
700	the potential exposure of the fund, the administrative costs to
701	the insurer and to the fund, and any other factors deemed
702	appropriate by the board. The formula shall include a factor of
703	25 percent of the fund's actuarially indicated premium in order
704	to provide for more rapid cash buildup in the fund. The formula
705	must be approved by unanimous vote of the board. The board may,
706	at any time, revise the formula pursuant to the procedure
707	provided in this paragraph.
708	(7)  ADDITIONAL POWERS AND DUTIES.--
709	(a)  The board may procure reinsurance from reinsurers
710	acceptable to the Office of Insurance Regulation for the purpose
711	of maximizing the capacity of the fund and may enter into
712	capital market transactions, including, but not limited to,
713	industry loss warranties, catastrophe bonds, side-car
714	arrangements, or financial contracts permissible for the board's
715	usage under s. 215.47(10) and (11), consistent with prudent
716	management of the fund.
717	(16) TEMPORARY EMERGENCY OPTIONS FOR ADDITIONAL COVERAGE.--
718	(a) Findings and intent.--
719	1. The Legislature finds that:
720	a. Because of temporary disruptions in the market for
721	catastrophic reinsurance, many property insurers were unable to
722	procure reinsurance for the 2006 hurricane season with an
723	attachment point below the insurers' respective Florida
724	Hurricane Catastrophe Fund attachment points, were unable to
725	procure sufficient amounts of such reinsurance, or were able to
726	procure such reinsurance only by incurring substantially higher
727	costs than in prior years.
728	b. The reinsurance market problems were responsible, at
729	least in part, for substantial premium increases to many
730	consumers and increases in the number of policies issued by the
731	Citizens Property Insurance Corporation.
732	c.  It is likely that the reinsurance market disruptions
733	will not significantly abate prior to the 2007 hurricane season.
734	2.  It is the intent of the Legislature to create a
735	temporary emergency program, applicable to the 2007, 2008, and
736	2009 hurricane seasons, to address these market disruptions and
737	enable insurers, at their option, to procure additional coverage
738	from the Florida Hurricane Catastrophe Fund.
739	(b)  Applicability of other provisions of this section.--
740	All provisions of this section and the rules adopted under this
741	section apply to the program created by this subsection unless
742	specifically superseded by this subsection.
743	(c)  Optional coverage.--For the contract year commencing
744	June 1, 2007, and ending May 31, 2008, the contract year
745	commencing June 1, 2008, and ending May 31, 2009, and the
746	contract year commending June 1, 2009, and ending May 31, 2010,
747	the board shall offer for each of such years the optional
748	coverage as provided in this subsection.
749	(d)  Additional definitions.--As used in this subsection,
750	the term:
751	1.  "TEACO options" means the temporary emergency
752	additional coverage options created under this subsection.
753	2.  "TEACO insurer" means an insurer that has opted to
754	obtain coverage under the TEACO options in addition to the
755	coverage provided to the insurer under its reimbursement
756	contract.
757	3.  "TEACO reimbursement premium" means the premium charged
758	by the fund for coverage provided under the TEACO options.
759	4.  "TEACO retention" means the amount of losses below
760	which a TEACO insurer is not entitled to reimbursement from the
761	fund under the TEACO option selected. A TEACO insurer's
762	retention options shall be calculated as follows:
763	a.  The board shall calculate and report to each TEACO
764	insurer the TEACO retention multiples. There shall be three
765	TEACO retention multiples for defining coverage. Each multiple
766	shall be calculated by dividing $3 billion, $4 billion, or $5
767	billion by the total estimated TEACO reimbursement premium
768	assuming all insurers selected that option. Total estimated
769	TEACO reimbursement premium for purposes of the calculation
770	under this sub-subparagraph shall be calculated using the
771	assumption that all insurers have selected a specific TEACO
772	retention multiple option and have selected the 90-percent
773	coverage level.
774	b.  The TEACO retention multiples as determined under sub-
775	subparagraph a. shall be adjusted to reflect the coverage level
776	elected by the insurer. For insurers electing the 90-percent
777	coverage level, the adjusted retention multiple is 100 percent
778	of the amount determined under sub-subparagraph a. For insurers
779	electing the 75-percent coverage level, the retention multiple
780	is 120 percent of the amount determined under sub-subparagraph
781	a. For insurers electing the 45-percent coverage level, the
782	adjusted retention multiple is 200 percent of the amount
783	determined under sub-subparagraph a.
784	c.  An insurer shall determine its provisional TEACO
785	retention by multiplying its provisional TEACO reimbursement
786	premium by the applicable adjusted TEACO retention multiple and
787	shall determine its actual TEACO retention by multiplying its
788	actual TEACO reimbursement premium by the applicable adjusted
789	TEACO retention multiple.
790	d.  For TEACO insurers who experience multiple covered
791	events causing loss during the contract year, the insurer's full
792	TEACO retention shall be applied to each of the covered events
793	causing the two largest losses for that insurer. For other
794	covered events resulting in losses, the TEACO option does not
795	apply and the insurer's retention shall be one-third of the full
796	retention as calculated under paragraph (2)(e).
797	5.  "TEACO addendum" means an addendum to the reimbursement
798	contract reflecting the obligations of the fund and TEACO
799	insurers under the program created by this subsection.
800	(e)  TEACO addendum.--
801	1.  The TEACO addendum shall provide for reimbursement of
802	TEACO insurers for covered events occurring during the contract
803	year, in exchange for the TEACO reimbursement premium paid into
804	the fund under paragraph (f). Any insurer writing covered
805	policies has the option of choosing to accept the TEACO addendum
806	for any of the three contract years that the coverage is
807	offered.
808	2.  The TEACO addendum shall contain a promise by the board
809	to reimburse the TEACO insurer for 45 percent, 75 percent, or 90
810	percent of its losses from each covered event in excess of the
811	insurer's TEACO retention, plus 5 percent of the reimbursed
812	losses to cover loss adjustment expenses. The percentage shall
813	be the same as the coverage level selected by the insurer under
814	paragraph (4)(b).
815	3.  The TEACO addendum shall provide that reimbursement
816	amounts shall not be reduced by reinsurance paid or payable to
817	the insurer from other sources.
818	4.  The TEACO addendum shall also provide that the
819	obligation of the board with respect to all TEACO addenda shall
820	not exceed an amount equal to two times the difference between
821	the industry retention level calculated under paragraph (2)(e)
822	and the $3 billion, $4 billion, or $5 billion industry TEACO
823	retention level options actually selected, but in no event may
824	the board's obligation exceed the actual claims-paying capacity
825	of the fund plus the additional capacity created in paragraph
826	(g). If the actual claims-paying capacity and the additional
827	capacity created under paragraph (g) fall short of the board's
828	obligations under the reimbursement contract, each insurer's
829	share of the fund's capacity shall be pro rated based on the
830	premium an insurer pays for its normal reimbursement coverage
831	and the premium paid for its optional TEACO coverage as each
832	such premium bears to the total premiums paid to the fund times
833	the available capacity.
834	5.  The priorities, schedule, and method of reimbursements
835	under the TEACO addendum shall be the same as provided under
836	subsection (4).
837	6.  A TEACO insurer's maximum reimbursement under the TEACO
838	addendum shall be calculated by multiplying the insurer's share
839	of the estimated total TEACO reimbursement premium as calculated
840	under sub-subparagraph (d)4.a. by an amount equal to two times
841	the difference between the industry retention level calculated
842	under paragraph (2)(e) and the $3 billion, $4 billion, or $5
843	billion industry TEACO retention level specified in sub-
844	subparagraph (d)4.a. as selected by the TEACO insurer.
845	(f)  TEACO reimbursement premiums.--
846	1.  Each TEACO insurer shall pay to the fund, in the manner
847	and at the time provided in the reimbursement contract for
848	payment of reimbursement premiums, a TEACO reimbursement premium
849	calculated as specified in this paragraph.
850	2.  The TEACO reimbursement premiums shall be calculated
851	based on the assumption that, if all insurers entering into
852	reimbursement contracts under subsection (4) also accepted the
853	TEACO option:
854	a.  The industry TEACO reimbursement premium associated
855	with the $3 billion retention option would be equal to 85
856	percent of the difference between the industry retention level
857	calculated under paragraph (2)(e) and the $3 billion industry
858	TEACO retention level.
859	b.  The TEACO reimbursement premium associated with the $4
860	billion retention option would be equal to 80 percent of the
861	difference between the industry retention level calculated under
862	paragraph (2)(e) and the $4 billion industry TEACO retention
863	level.
864	c.  The TEACO premium associated with the $5 billion
865	retention option would be equal to 75 percent of the difference
866	between the industry retention level calculated under paragraph
867	(2)(e) and the $5 billion industry TEACO retention level.
868	3.  Each insurer's TEACO premium shall be calculated based
869	on its share of the total TEACO reimbursement premiums based on
870	its coverage selection under the TEACO addendum.
871	(g)  Effect on claims-paying capacity of the fund.--For the
872	contract term commencing June 1, 2007, the contract year
873	commencing June 1, 2008, and the contract term beginning June 1,
874	2009, the program created by this subsection shall increase the
875	claims-paying capacity of the fund as provided in subparagraph
876	(4)(c)1. by an amount equal to two times the difference between
877	the industry retention level calculated under paragraph (2)(e)
878	and the $3 billion industry TEACO retention level specified in
879	sub-subparagraph (d)4.a. The additional capacity shall apply
880	only to the additional coverage provided by the TEACO option and
881	shall not otherwise affect any insurer's reimbursement from the
882	fund.
883	(17)  TEMPORARY INCREASE IN COVERAGE LIMIT OPTIONS.--
884	(a)  Findings and intent.--
885	1.  The Legislature finds that:
886	a.  Because of temporary disruptions in the market for
887	catastrophic reinsurance, many property insurers were unable to
888	procure sufficient amounts of reinsurance for the 2006 hurricane
889	season or were able to procure such reinsurance only by
890	incurring substantially higher costs than in prior years.
891	b.  The reinsurance market problems were responsible, at
892	least in part, for substantial premium increases to many
893	consumers and increases in the number of policies issued by
894	Citizens Property Insurance Corporation.
895	c.  It is likely that the reinsurance market disruptions
896	will not significantly abate prior to the 2007 hurricane season.
897	2.  It is the intent of the Legislature to create options
898	for insurers to purchase a temporary increased coverage limit
899	above the statutorily determined limit in subparagraph (4)(c)1.,
900	applicable for the 2007, 2008, and 2009 hurricane seasons, to
901	address market disruptions and enable insurers, at their option,
902	to procure additional coverage from the Florida Hurricane
903	Catastrophe Fund.
904	(b)  Applicability of other provisions of this section.--
905	All provisions of this section and the rules adopted under this
906	section apply to the coverage created by this subsection unless
907	specifically superseded by provisions in this subsection.
908	(c)  Optional coverage.--For the contract year commencing
909	June 1, 2007, and ending May 31, 2008, the contract year
910	commending June 1, 2008, and ending May 31, 2009, the contract
911	year commencing June 1, 2009, and ending May 31, 2010, the board
912	shall offer, for each of such years, the optional coverage as
913	provided in this subsection.
914	(d)  Additional definitions.--As used in this subsection,
915	the term:
916	1.  "FHCF" means Florida Hurricane Catastrophe Fund.
917	2.  "FHCF reimbursement premium" means the premium paid by
918	an insurer for its coverage as a mandatory participant in the
919	FHCF, but does not include additional premiums for optional
920	coverages.
921	3.  "Payout multiple" means the number or multiple created
922	by dividing the statutorily defined claims-paying capacity as
923	determined in subparagraph (4)(c)1. by the aggregate
924	reimbursement premiums paid by all insurers estimated or
925	projected as of calendar year-end.
926	4.  "TICL" means the temporary increase in coverage limit.
927	5.  "TICL options" means the temporary increase in coverage
928	options created under this subsection.
929	6.  "TICL insurer" means an insurer that has opted to
930	obtain coverage under the TICL options addendum in addition to
931	the coverage provided to the insurer under its FHCF
932	reimbursement contract.
933	7.  "TICL reimbursement premium" means the premium charged
934	by the fund for coverage provided under the TICL option.
935	8.  "TICL coverage multiple" means the coverage multiple
936	when multiplied by an insurer's reimbursement premium that
937	defines the temporary increase in coverage limit.
938	9.  "TICL coverage" means the coverage for an insurer's
939	losses above the insurer's statutorily determined claims-paying
940	capacity based on the claims-paying limit in subparagraph
941	(4)(c)1., which an insurer selects as its temporary increase in
942	coverage from the fund under the TICL options selected. A TICL
943	insurer's increased coverage limit options shall be calculated
944	as follows:
945	a.  The board shall calculate and report to each TICL
946	insurer the TICL coverage multiples based on twelve options for
947	increasing the insurer's FHCF coverage limit. Each TICL coverage
948	multiple shall be calculated by dividing $1 billion, $2 billion,
949	$3 billion, $4 billion, $5 billion, $6 billion, $7 billion, $8
950	billion, $9 billion, $10 billion, $11 billion, or $12 billion by
951	the total estimated aggregate FHCF reimbursement premiums for
952	the 2007-2008 contract year, the 2008-2009 contract year, and
953	the 2009-2010 contract year.
954	b.  The TICL insurer's increased coverage shall be the FHCF
955	reimbursement premium multiplied by the TICL coverage multiple.
956	In order to determine an insurer's total limit of coverage, an
957	insurer shall add its TICL coverage multiple to its payout
958	multiple. The total shall represent a number that, when
959	multiplied by an insurer's FHCF reimbursement premium for a
960	given reimbursement contract year, defines an insurer's total
961	limit of FHCF reimbursement coverage for that reimbursement
962	contract year.
963	10.  "TICL options addendum" means an addendum to the
964	reimbursement contract reflecting the obligations of the fund
965	and insurers selecting an option to increase an insurer's FHCF
966	coverage limit.
967	(e)  TICL options addendum.--
968	1.  The TICL options addendum shall provide for
969	reimbursement of TICL insurers for covered events occurring
970	between June 1, 2007, May 31, 2008, and between June 1, 2008,
971	and May 31, 2009, or between June 1, 2009, and May 31, 2010, in
972	exchange for the TICL reimbursement premium paid into the fund
973	under paragraph (e). Any insurer writing covered policies has
974	the option of selecting an increased limit of coverage under the
975	TICL options addendum and shall select such coverage at the time
976	that it executes the FHCF reimbursement contract.
977	2.  The TICL addendum shall contain a promise by the board
978	to reimburse the TICL insurer for 45 percent, 75 percent, or 90
979	percent of its losses from each covered event in excess of the
980	insurer's retention, plus 5 percent of the reimbursed losses to
981	cover loss adjustment expenses. The percentage shall be the same
982	as the coverage level selected by the insurer under paragraph
983	(4)(b).
984	3.  The TICL addendum shall provide that reimbursement
985	amounts shall not be reduced by reinsurance paid or payable to
986	the insurer from other sources.
987	4.  The priorities, schedule, and method of reimbursements
988	under the TICL addendum shall be the same as provided under
989	subsection (4).
990	(f)  TICL reimbursement premiums.--Each TICL insurer shall
991	pay to the fund, in the manner and at the time provided in the
992	reimbursement contract for payment of reimbursement premiums, a
993	TICL reimbursement premium determined as specified in subsection
994	(5).
995	(g)  Effect on claims-paying capacity of the fund.--For the
996	contract terms commencing June 1, 2007, June 1, 2008, and June
997	1, 2009, the program created by this subsection shall increase
998	the claims-paying capacity of the fund as provided in
999	subparagraph (4)(c)1. by an amount not to exceed $12 billion
1000	dollars and shall depend on the TICL coverage options selected
1001	and the number of insurers that select the TICL optional
1002	coverage. The additional capacity shall apply only to the
1003	additional coverage provided under the TICL options and shall
1004	not otherwise affect any insurer's reimbursement from the fund
1005	if the insurer chooses not to select the temporary option to
1006	increase its limit of coverage under the FHCF.
1007	(h)  Increasing the claims-paying capacity of the fund.--
1008	For the contract years commencing June 1, 2007, June 1, 2008,
1009	and June 1, 2009, the board may increase the claims-paying
1010	capacity of the fund as provided in paragraph (g) by an amount
1011	not to exceed $4 billion in four $1 billion options and shall
1012	depend on the TICL coverage options selected and the number of
1013	insurers that select the TICL optional coverage. Each insurer's
1014	TICL premium shall be calculated based upon the additional limit
1015	of increased coverage that the insurer selects. Such limit is
1016	determined by multiplying the TICL multiple associated with one
1017	of the four options times the insurer's FHCF reimbursement
1018	premium. The reimbursement premium associated with the
1019	additional coverage provided in this paragraph shall be
1020	determined as specified in subsection (5).
1021	Section 3.  (1)  Every residential property insurer must
1022	make a rate filing with the Office of Insurance Regulation,
1023	pursuant to the "file and use" provisions of s. 627.062(2)(a)1.,
1024	Florida Statutes, which reflects the savings or reduction in
1025	loss exposure to the insurer due to the provisions of section 2
1026	of this act. An insurer may not obtain a rate increase due to
1027	the election of coverage options from the Florida Hurricane
1028	Catastrophe Fund pursuant to s. 215.555(4), (16), or (17),
1029	Florida Statutes.
1030	(2)  The office shall specify, by order, the date or dates
1031	on which the rate filings required by this section must be made
1032	and be effective in order to provide rate relief to
1033	policyholders a soon as practicable.
1034	(3)  By March 15, 2007, the Office of Insurance Regulation
1035	shall calculate a presumed factor or factors to be used in the
1036	rate filings required by this section to reflect the impact to
1037	rates of the changes made by section 2 of this act and this
1038	section.
1039	(4)  In determining the presumed factor, the Office of
1040	Insurance Regulation shall use generally accepted actuarial
1041	techniques and standards in determining the expected impact on
1042	losses, expenses, and investment income of insurers.
1043	(5)  The office may contract with an appropriate vendor to
1044	advise the office in determining the presumed factor or factors.
1045	(6)  Each residential property insurer shall reflect a rate
1046	change that takes into account the presumed factor determined
1047	under subsection (3) for any policy written or renewed on or
1048	after June 1, 2007. Such factor must be taken into account for
1049	the coverage options offered pursuant to s. 215.555(4), (16),
1050	and (17), Florida Statutes, for an insurer eligible to elect
1051	such optional coverage, whether or not the insurer purchases
1052	that coverage. Any additional cost for private reinsurance or
1053	loss exposure that duplicates such coverage options may not be
1054	factored in the rate, whether or not such coverage options are
1055	purchased.
1056	(7)  The sum of $250,000 in nonrecurring funds is
1057	appropriated from the Insurance Regulatory Trust Fund in the
1058	Department of Financial Services to the Office of Insurance
1059	Regulation for the 2006-2007 fiscal year for the purpose of
1060	implementing this section.
1061	Section 4.  Paragraph (b) of subsection (1) and subsection
1062	(2) of section 215.5586, Florida Statutes, are amended, and
1063	subsections (7) and (8) are added to that section, to read:
1064	215.5586  Florida Comprehensive Hurricane Damage Mitigation
1065	Program.--There is established within the Department of
1066	Financial Services the Florida Comprehensive Hurricane Damage
1067	Mitigation Program. This section does not create an entitlement
1068	for property owners or obligate the state in any way to fund the
1069	inspection or retrofitting of residential property in this
1070	state. Implementation of this program is subject to annual
1071	legislative appropriations. The program shall be administered by
1072	an individual with prior executive experience in the private
1073	sector in the areas of insurance, business, or construction. The
1074	program shall develop and implement a comprehensive and
1075	coordinated approach for hurricane damage mitigation that shall
1076	include the following:
1077	(1)  WIND CERTIFICATION AND HURRICANE MITIGATION
1078	INSPECTIONS.--
1079	(b)  To qualify for selection by the department as a
1080	provider of wind certification and hurricane mitigation
1081	inspections, the entity shall, at a minimum:
1082	1.  Use wind certification and hurricane mitigation
1083	inspectors who:
1084	a.  Have prior experience in residential construction or
1085	inspection and have received specialized training in hurricane
1086	mitigation procedures.
1087	b.  Have undergone drug testing and level 2 background
1088	checks pursuant to s. 435.04. The department is authorized to
1089	conduct criminal record checks of inspectors. Inspectors must
1090	submit a set of the fingerprints to the department for state and
1091	national criminal history checks and must pay the fingerprint
1092	processing fee set forth in s. 624.501. The fingerprints shall
1093	be sent by the department to the Department of Law Enforcement
1094	and forwarded to the Federal Bureau of Investigation for
1095	processing. The results shall be returned to the department for
1096	screening. The fingerprints shall be taken by a law enforcement
1097	agency, designated examination center, or other department-
1098	approved entity. Wind certification and hurricane mitigation
1099	inspectors participating in the program on the effective date of
1100	this act shall have until June 1, 2007, to meet the requirements
1101	for a criminal record check.
1102	c.  Have been certified, in a manner satisfactory to the
1103	department, to conduct the inspections.
1104	2.  Provide a quality assurance program including a
1105	reinspection component.
1106	(2)  GRANTS.--Financial grants shall be used to encourage
1107	single-family, site-built, owner-occupied, residential property
1108	owners to retrofit their properties to make them less vulnerable
1109	to hurricane damage.
1110	(a)  To be eligible for a grant, a residential property
1111	must:
1112	1.  Have been granted a homestead exemption under chapter
1113	196.
1114	2.  Be a dwelling with an insured value of $500,000 or
1115	less. Homeowners who are low-income persons, as defined in s.
1116	420.0004(10), are exempt from this requirement.
1117	3.  Have undergone an acceptable wind certification and
1118	hurricane mitigation inspection, if the property is an existing
1119	structure.
1120
1121	A residential property which is part of a multifamily
1122	residential unit may receive a grant only if all homeowners
1123	participate and the total number of units does not exceed four.
1124	(b)  All grants must be matched on a dollar-for-dollar
1125	basis for a total of $10,000 for the mitigation project with the
1126	state's contribution not to exceed $5,000.
1127	(c)  The program shall create a process in which mitigation
1128	contractors agree to participate and seek reimbursement from the
1129	state and homeowners select from a list of participating
1130	contractors. All mitigation must be based upon the securing of
1131	all required local permits and inspections. Mitigation projects
1132	are subject to random reinspection of up to at least 10 percent
1133	of all projects.
1134	(d)  Matching fund grants shall also be made available to
1135	local governments and nonprofit entities for projects that will
1136	reduce hurricane damage to single-family, site-built, owner-
1137	occupied, residential property.
1138	(e)  Grants may be used for the following improvements:
1139	1.  Roof deck attachment.;
1140	2.  Secondary water barrier.;
1141	3.  Roof covering.;
1142	4.  Brace gable ends.;
1143	5.  Reinforce roof-to-wall connections.;
1144	6.  Opening protection.; and
1145	7.  Exterior doors, including garage doors.
1146	(f)  Grants may be used on a previously inspected existing
1147	structure or on a rebuild. A rebuild is defined as a site-built,
1148	single-family dwelling under construction to replace a home that
1149	was destroyed or significantly damaged by a hurricane and deemed
1150	unlivable by a regulatory authority. The homeowner must have had
1151	a homestead exemption prior to the hurricane and maintained the
1152	homestead exemption.
1153	(g)(f)  Low-income homeowners, as defined in s.
1154	420.0004(10)(9), who otherwise meet the requirements of
1155	paragraphs (a), and (c), (e), and (f) are eligible for a grant
1156	of up to $5,000 and are not required to provide a matching
1157	amount to receive the grant. Additionally, for low-income
1158	homeowners, grant funding may be used for repair to existing
1159	structures leading to any of the mitigation improvements
1160	provided in paragraph (e), limited to 20 percent of the grant
1161	value. Such grants shall be used to retrofit single-family,
1162	site-built, owner-occupied, residential properties in order to
1163	make them less vulnerable to hurricane damage.
1164	(7)  CONTRACTS WITH NOT-FOR-PROFIT CORPORATIONS.--The
1165	Department of Financial Services is authorized to contract with
1166	not-for-profit corporations to conduct all or portions of the
1167	program and to increase the awareness of the benefits of
1168	mitigation among homeowners in this state. The department shall
1169	consider the not-for-profit corporation's ability to raise funds
1170	from the private sector to provide for mitigation grants, as
1171	well as administrative capabilities for conducting other
1172	business related to the program.
1173	(8)  WIND CERTIFICATION AND HURRICANE MITIGATION INSPECTOR
1174	LIST.--The department shall develop and maintain as a public
1175	record a current list of wind certification and hurricane
1176	mitigation inspectors authorized to conduct wind certification
1177	and hurricane mitigation inspections pursuant to this section.
1178	Section 5.  Paragraphs (a), (c), and (g) of subsection (2)
1179	of section 215.5595, Florida Statutes, are amended, and
1180	paragraph (i) is added to that subsection, to read:
1181	215.5595  Insurance Capital Build-Up Incentive Program.--
1182	(2)  The purpose of this section is to provide surplus
1183	notes to new or existing authorized residential property
1184	insurers under the Insurance Capital Build-Up Incentive Program
1185	administered by the State Board of Administration, under the
1186	following conditions:
1187	(a)  The amount of the surplus note for any insurer or
1188	insurer group, other than an insurer writing only manufactured
1189	housing policies, may not exceed $25 million or 20 percent of
1190	the total amount of funds available under the program, whichever
1191	is greater. The amount of the surplus note for any insurer or
1192	insurer group writing residential property insurance covering
1193	only manufactured housing may not exceed $7 million.
1194	(c)  The insurer's surplus, new capital, and the surplus
1195	note must total at least $50 million, except for insurers
1196	writing residential property insurance covering only
1197	manufactured housing. The insurer's surplus, new capital, and
1198	the surplus note must total at least $14 million for insurers
1199	writing only residential property insurance covering
1200	manufactured housing policies as provided in paragraph (a).
1201	(g)  The total amount of funds available for the program is
1202	limited to the amount appropriated by the Legislature for this
1203	purpose. If the amount of surplus notes requested by insurers
1204	exceeds the amount of funds available, the board may prioritize
1205	insurers that are eligible and approved, with priority for
1206	funding given to insurers writing only manufactured housing
1207	policies, regardless of the date of application, based on the
1208	financial strength of the insurer, the viability of its proposed
1209	business plan for writing additional residential property
1210	insurance in the state, and the effect on competition in the
1211	residential property insurance market.
1212	(i)  Notwithstanding paragraph (d), a newly formed
1213	manufactured housing insurer that is eligible for a surplus note
1214	under this section shall meet the premium to surplus ratio
1215	provisions of s. 624.4095.
1216	Section 6.  Section 395.106, Florida Statutes, is created
1217	to read:
1218	395.106  Risk pooling by certain hospitals and hospital
1219	systems.--
1220	(1)  Notwithstanding any other provision of law, any two or
1221	more hospitals licensed in this state and located in this state
1222	may form an alliance for the purpose of pooling and spreading
1223	liabilities of its members relative to property exposure or
1224	securing such property insurance coverage for the benefit of its
1225	members, provided an alliance that is created:
1226	(a)  Has annual premiums in excess of $3 million.
1227	(b)  Maintains a continuing program of premium calculation
1228	and evaluation and reserve evaluation to protect the financial
1229	stability of the alliance in an amount and manner determined by
1230	consultants using catastrophic (CAT) modeling criteria or other
1231	risk-estimating methodologies, including those used by qualified
1232	and independent actuaries.
1233	(c)  Causes to be prepared annually a fiscal year-end
1234	financial statement based upon generally accepted accounting
1235	principles and audited by an independent certified public
1236	accountant within 6 months after the end of the fiscal year.
1237	(d)  Has a governing body comprised entirely of member
1238	entities whose representatives on such governing body are
1239	specified by the organizational documents of the alliance.
1240	(2)  For purposes of this section, the term:
1241	(a)  "Alliance" means a corporation, association, limited
1242	liability company, or partnership or any other legal entity
1243	formed by a group of eligible entities.
1244	(b)  "Property coverage" means property coverage provided
1245	by self-insurance or insurance for real or personal property of
1246	every kind and every interest in such property against loss or
1247	damage from any hazard or cause and against any loss
1248	consequential to such loss or damage.
1249	(3)  An alliance that meets the requirements of this
1250	section is not subject to any provision of the Insurance Code.
1251	(4)  An alliance that meets the requirements of this
1252	section is not an insurer for purposes of participation in or
1253	coverage by the Florida Insurance Guaranty Association
1254	established in part II of chapter 631. Alliance self-insured
1255	coverage is not subject to insurance premium tax, and any such
1256	alliance formed pursuant to this section may not be assessed for
1257	purposes of s. 627.351 or s. 215.555.
1258	Section 7.  Section 553.73, Florida Statutes, is amended to
1259	read:
1260	553.73  Florida Building Code.--
1261	(1)(a)  The commission shall adopt, by rule pursuant to ss.
1262	120.536(1) and 120.54, the Florida Building Code which shall
1263	contain or incorporate by reference all laws and rules which
1264	pertain to and govern the design, construction, erection,
1265	alteration, modification, repair, and demolition of public and
1266	private buildings, structures, and facilities and enforcement of
1267	such laws and rules, except as otherwise provided in this
1268	section.
1269	(b)  The technical portions of the Florida Accessibility
1270	Code for Building Construction shall be contained in their
1271	entirety in the Florida Building Code. The civil rights portions
1272	and the technical portions of the accessibility laws of this
1273	state shall remain as currently provided by law. Any revision or
1274	amendments to the Florida Accessibility Code for Building
1275	Construction pursuant to part II shall be considered adopted by
1276	the commission as part of the Florida Building Code. Neither the
1277	commission nor any local government shall revise or amend any
1278	standard of the Florida Accessibility Code for Building
1279	Construction except as provided for in part II.
1280	(c)  The Florida Fire Prevention Code and the Life Safety
1281	Code shall be referenced in the Florida Building Code, but shall
1282	be adopted, modified, revised, or amended, interpreted, and
1283	maintained by the Department of Financial Services by rule
1284	adopted pursuant to ss. 120.536(1) and 120.54. The Florida
1285	Building Commission may not adopt a fire prevention or
1286	lifesafety code, and nothing in the Florida Building Code shall
1287	affect the statutory powers, duties, and responsibilities of any
1288	fire official or the Department of Financial Services.
1289	(d)  Conflicting requirements between the Florida Building
1290	Code and the Florida Fire Prevention Code and Life Safety Code
1291	of the state established pursuant to ss. 633.022 and 633.025
1292	shall be resolved by agreement between the commission and the
1293	State Fire Marshal in favor of the requirement that offers the
1294	greatest degree of lifesafety or alternatives that would provide
1295	an equivalent degree of lifesafety and an equivalent method of
1296	construction. If the commission and State Fire Marshal are
1297	unable to agree on a resolution, the question shall be referred
1298	to a mediator, mutually agreeable to both parties, to resolve
1299	the conflict in favor of the provision that offers the greatest
1300	lifesafety, or alternatives that would provide an equivalent
1301	degree of lifesafety and an equivalent method of construction.
1302	(e)  Subject to the provisions of this act, responsibility
1303	for enforcement, interpretation, and regulation of the Florida
1304	Building Code shall be vested in a specified local board or
1305	agency, and the words "local government" and "local governing
1306	body" as used in this part shall be construed to refer
1307	exclusively to such local board or agency.
1308	(2)  The Florida Building Code shall contain provisions or
1309	requirements for public and private buildings, structures, and
1310	facilities relative to structural, mechanical, electrical,
1311	plumbing, energy, and gas systems, existing buildings,
1312	historical buildings, manufactured buildings, elevators, coastal
1313	construction, lodging facilities, food sales and food service
1314	facilities, health care facilities, including assisted living
1315	facilities, adult day care facilities, hospice residential and
1316	inpatient facilities and units, and facilities for the control
1317	of radiation hazards, public or private educational facilities,
1318	swimming pools, and correctional facilities and enforcement of
1319	and compliance with such provisions or requirements. Further,
1320	the Florida Building Code must provide for uniform
1321	implementation of ss. 515.25, 515.27, and 515.29 by including
1322	standards and criteria for residential swimming pool barriers,
1323	pool covers, latching devices, door and window exit alarms, and
1324	other equipment required therein, which are consistent with the
1325	intent of s. 515.23. Technical provisions to be contained within
1326	the Florida Building Code are restricted to requirements related
1327	to the types of materials used and construction methods and
1328	standards employed in order to meet criteria specified in the
1329	Florida Building Code. Provisions relating to the personnel,
1330	supervision or training of personnel, or any other professional
1331	qualification requirements relating to contractors or their
1332	workforce may not be included within the Florida Building Code,
1333	and subsections (4), (5), (6), and (7), and (8) are not to be
1334	construed to allow the inclusion of such provisions within the
1335	Florida Building Code by amendment. This restriction applies to
1336	both initial development and amendment of the Florida Building
1337	Code.
1338	(3)  The commission shall select from available national or
1339	international model building codes, or other available building
1340	codes and standards currently recognized by the laws of this
1341	state, to form the foundation for the Florida Building Code. The
1342	commission may modify the selected model codes and standards as
1343	needed to accommodate the specific needs of this state.
1344	Standards or criteria referenced by the selected model codes
1345	shall be similarly incorporated by reference.  If a referenced
1346	standard or criterion requires amplification or modification to
1347	be appropriate for use in this state, only the amplification or
1348	modification shall be specifically set forth in the Florida
1349	Building Code. The Florida Building Commission may approve
1350	technical amendments to the code, subject to the requirements of
1351	subsections (7) and (8), after the amendments have been subject
1352	to the following conditions:
1353	(a)  The proposed amendment has been published on the
1354	commission's website for a minimum of 45 days and all the
1355	associated documentation has been made available to any
1356	interested party before any consideration by any Technical
1357	Advisory Committee;
1358	(b)  In order for a Technical Advisory Committee to make a
1359	favorable recommendation to the commission, the proposal must
1360	receive a three-fourths vote of the members present at the
1361	Technical Advisory Committee meeting and at least half of the
1362	regular members must be present in order to conduct a meeting;
1363	(c)  After Technical Advisory Committee consideration and a
1364	recommendation for approval of any proposed amendment, the
1365	proposal must be published on the commission's website for not
1366	less than 45 days before any consideration by the commission;
1367	and
1368	(d)  Any proposal may be modified by the commission based
1369	on public testimony and evidence from a public hearing held in
1370	accordance with chapter 120.
1371
1372	The commission shall incorporate within sections of the Florida
1373	Building Code provisions which address regional and local
1374	concerns and variations. The commission shall make every effort
1375	to minimize conflicts between the Florida Building Code, the
1376	Florida Fire Prevention Code, and the Life Safety Code.
1377	(4)(a)  All entities authorized to enforce the Florida
1378	Building Code pursuant to s. 553.80 shall comply with applicable
1379	standards for issuance of mandatory certificates of occupancy,
1380	minimum types of inspections, and procedures for plans review
1381	and inspections as established by the commission by rule. Local
1382	governments may adopt amendments to the administrative
1383	provisions of the Florida Building Code, subject to the
1384	limitations of this paragraph. Local amendments shall be more
1385	stringent than the minimum standards described herein and shall
1386	be transmitted to the commission within 30 days after enactment.
1387	The local government shall make such amendments available to
1388	the general public in a usable format.  The State Fire Marshal
1389	is responsible for establishing the standards and procedures
1390	required in this paragraph for governmental entities with
1391	respect to applying the Florida Fire Prevention Code and the
1392	Life Safety Code.
1393	(b)  Local governments may, subject to the limitations of
1394	this section, adopt amendments to the technical provisions of
1395	the Florida Building Code which apply solely within the
1396	jurisdiction of such government and which provide for more
1397	stringent requirements than those specified in the Florida
1398	Building Code, not more than once every 6 months. A local
1399	government may adopt technical amendments that address local
1400	needs if:
1401	1.  The local governing body determines, following a public
1402	hearing which has been advertised in a newspaper of general
1403	circulation at least 10 days before the hearing, that there is a
1404	need to strengthen the requirements of the Florida Building
1405	Code. The determination must be based upon a review of local
1406	conditions by the local governing body, which review
1407	demonstrates by evidence or data that the geographical
1408	jurisdiction governed by the local governing body exhibits a
1409	local need to strengthen the Florida Building Code beyond the
1410	needs or regional variation addressed by the Florida Building
1411	Code, that the local need is addressed by the proposed local
1412	amendment, and that the amendment is no more stringent than
1413	necessary to address the local need.
1414	2.  Such additional requirements are not discriminatory
1415	against materials, products, or construction techniques of
1416	demonstrated capabilities.
1417	3.  Such additional requirements may not introduce a new
1418	subject not addressed in the Florida Building Code.
1419	4.  The enforcing agency shall make readily available, in a
1420	usable format, all amendments adopted pursuant to this section.
1421	5.  Any amendment to the Florida Building Code shall be
1422	transmitted within 30 days by the adopting local government to
1423	the commission.  The commission shall maintain copies of all
1424	such amendments in a format that is usable and obtainable by the
1425	public. Local technical amendments shall not become effective
1426	until 30 days after the amendment has been received and
1427	published by the commission.
1428	6.  Any amendment to the Florida Building Code adopted by a
1429	local government pursuant to this paragraph shall be effective
1430	only until the adoption by the commission of the new edition of
1431	the Florida Building Code every third year. At such time, the
1432	commission shall review such amendment for consistency with the
1433	criteria in paragraph (8)(a) (7)(a) and adopt such amendment as
1434	part of the Florida Building Code or rescind the amendment. The
1435	commission shall immediately notify the respective local
1436	government of the rescission of any amendment. After receiving
1437	such notice, the respective local government may readopt the
1438	rescinded amendment pursuant to the provisions of this
1439	paragraph.
1440	7.  Each county and municipality desiring to make local
1441	technical amendments to the Florida Building Code shall by
1442	interlocal agreement establish a countywide compliance review
1443	board to review any amendment to the Florida Building Code,
1444	adopted by a local government within the county pursuant to this
1445	paragraph, that is challenged by any substantially affected
1446	party for purposes of determining the amendment's compliance
1447	with this paragraph. If challenged, the local technical
1448	amendments shall not become effective until time for filing an
1449	appeal pursuant to subparagraph 8. has expired or, if there is
1450	an appeal, until the commission issues its final order
1451	determining the adopted amendment is in compliance with this
1452	subsection.
1453	8.  If the compliance review board determines such
1454	amendment is not in compliance with this paragraph, the
1455	compliance review board shall notify such local government of
1456	the noncompliance and that the amendment is invalid and
1457	unenforceable until the local government corrects the amendment
1458	to bring it into compliance. The local government may appeal the
1459	decision of the compliance review board to the commission. If
1460	the compliance review board determines such amendment to be in
1461	compliance with this paragraph, any substantially affected party
1462	may appeal such determination to the commission. Any such appeal
1463	shall be filed with the commission within 14 days of the board's
1464	written determination. The commission shall promptly refer the
1465	appeal to the Division of Administrative Hearings for the
1466	assignment of an administrative law judge. The administrative
1467	law judge shall conduct the required hearing within 30 days, and
1468	shall enter a recommended order within 30 days of the conclusion
1469	of such hearing. The commission shall enter a final order within
1470	30 days thereafter. The provisions of chapter 120 and the
1471	uniform rules of procedure shall apply to such proceedings. The
1472	local government adopting the amendment that is subject to
1473	challenge has the burden of proving that the amendment complies
1474	with this paragraph in proceedings before the compliance review
1475	board and the commission, as applicable. Actions of the
1476	commission are subject to judicial review pursuant to s. 120.68.
1477	The compliance review board shall determine whether its
1478	decisions apply to a respective local jurisdiction or apply
1479	countywide.
1480	9.  An amendment adopted under this paragraph shall include
1481	a fiscal impact statement which documents the costs and benefits
1482	of the proposed amendment.  Criteria for the fiscal impact
1483	statement shall include the impact to local government relative
1484	to enforcement, the impact to property and building owners, as
1485	well as to industry, relative to the cost of compliance. The
1486	fiscal impact statement may not be used as a basis for
1487	challenging the amendment for compliance.
1488	10.  In addition to subparagraphs 7. and 9., the
1489	commission may review any amendments adopted pursuant to this
1490	subsection and make nonbinding recommendations related to
1491	compliance of such amendments with this subsection.
1492	(c)  Any amendment adopted by a local enforcing agency
1493	pursuant to this subsection shall not apply to state or school
1494	district owned buildings, manufactured buildings or factory-
1495	built school buildings approved by the commission, or prototype
1496	buildings approved pursuant to s. 553.77(3). The respective
1497	responsible entities shall consider the physical performance
1498	parameters substantiating such amendments when designing,
1499	specifying, and constructing such exempt buildings.
1500	(5)  The initial adoption of, and any subsequent update or
1501	amendment to, the Florida Building Code by the commission is
1502	deemed adopted for use statewide without adoptions by local
1503	government. For a building permit for which an application is
1504	submitted prior to the effective date of the Florida Building
1505	Code, the state minimum building code in effect in the
1506	permitting jurisdiction on the date of the application governs
1507	the permitted work for the life of the permit and any extension
1508	granted to the permit.
1509	(6)(a)  The commission, by rule adopted pursuant to ss.
1510	120.536(1) and 120.54, shall update the Florida Building Code
1511	every 3 years. When updating the Florida Building Code, the
1512	commission shall select the most current version of the
1513	International Building Code, the International Fuel Gas Code,
1514	the International Mechanical Code, the International Plumbing
1515	Code, and the International Residential Code, all of which are
1516	adopted by the International Code Council, and the National
1517	Electrical Code, which is adopted by the National Fire
1518	Protection Association, to form the foundation codes of the
1519	updated Florida Building Code, if the version has been adopted
1520	by the applicable model code entity and made available to the
1521	public at least 6 months prior to its selection by the
1522	commission.
1523	(b)  Codes regarding noise contour lines shall be reviewed
1524	annually, and the most current federal guidelines shall be
1525	adopted.
1526	(c)  The commission may modify any portion of the
1527	foundation codes only as needed to accommodate the specific
1528	needs of this state, maintaining Florida-specific amendments
1529	previously adopted by the commission and not addressed by the
1530	updated foundation code. Standards or criteria referenced by the
1531	codes shall be incorporated by reference. If a referenced
1532	standard or criterion requires amplification or modification to
1533	be appropriate for use in this state, only the amplification or
1534	modification shall be set forth in the Florida Building Code.
1535	The commission may approve technical amendments to the updated
1536	Florida Building Code after the amendments have been subject to
1537	the conditions set forth in paragraphs (3)(a)-(d). Amendments to
1538	the foundation codes which are adopted in accordance with this
1539	subsection shall be clearly marked in printed versions of the
1540	Florida Building Code so that the fact that the provisions are
1541	Florida-specific amendments to the foundation codes is readily
1542	apparent.
1543	(d)  The commission shall further consider the commission's
1544	own interpretations, declaratory statements, appellate
1545	decisions, and approved statewide and local technical amendments
1546	and shall incorporate such interpretations, statements,
1547	decisions, and amendments into the updated Florida Building Code
1548	only to the extent that they are needed to modify the foundation
1549	codes to accommodate the specific needs of the state. A change
1550	made by an institute or standards organization to any standard
1551	or criterion that is adopted by reference in the Florida
1552	Building Code does not become effective statewide until it has
1553	been adopted by the commission. Furthermore, the edition of the
1554	Florida Building Code which is in effect on the date of
1555	application for any permit authorized by the code governs the
1556	permitted work for the life of the permit and any extension
1557	granted to the permit.
1558	(e)  A rule updating the Florida Building Code in
1559	accordance with this subsection shall take effect no sooner than
1560	6 months after publication of the updated code. Any amendment to
1561	the Florida Building Code which is adopted upon a finding by the
1562	commission that the amendment is necessary to protect the public
1563	from immediate threat of harm takes effect immediately.
1564	(f)  Provisions of the foundation codes, including those
1565	contained in referenced standards and criteria, relating to wind
1566	resistance or the prevention of water intrusion may not be
1567	modified to diminish those construction requirements; however,
1568	the commission may, subject to conditions in this subsection,
1569	modify the provisions to enhance those construction
1570	requirements.
1571	(7)(f)  Upon the conclusion of a triennial update to the
1572	Florida Building Code, notwithstanding the provisions of this
1573	subsection or subsection (3) or subsection (6), the commission
1574	may address issues identified in this subsection paragraph by
1575	amending the code pursuant only to the rule adoption procedures
1576	contained in chapter 120. Provisions of the Florida Building
1577	Code, including those contained in referenced standards and
1578	criteria, relating to wind resistance or the prevention of water
1579	intrusion may not be amended pursuant to this subsection to
1580	diminish those construction requirements; however, the
1581	commission may, subject to conditions in this subsection, amend
1582	the provisions to enhance those construction requirements.
1583	Following the approval of any amendments to the Florida Building
1584	Code by the commission and publication of the amendments on the
1585	commission's website, authorities having jurisdiction to enforce
1586	the Florida Building Code may enforce the amendments. The
1587	commission may approve amendments that are needed to address:
1588	(a)1.  Conflicts within the updated code;
1589	(b)2.  Conflicts between the updated code and the Florida
1590	Fire Prevention Code adopted pursuant to chapter 633;
1591	(c)3.  The omission of previously adopted Florida-specific
1592	amendments to the updated code if such omission is not supported
1593	by a specific recommendation of a technical advisory committee
1594	or particular action by the commission; or
1595	(d)4.  Unintended results from the integration of
1596	previously adopted Florida-specific amendments with the model
1597	code.
1598	(8)(7)(a)  The commission may approve technical amendments
1599	to the Florida Building Code once each year for statewide or
1600	regional application upon a finding that the amendment:
1601	1.  Is needed in order to accommodate the specific needs of
1602	this state.
1603	2.  Has a reasonable and substantial connection with the
1604	health, safety, and welfare of the general public.
1605	3.  Strengthens or improves the Florida Building Code, or
1606	in the case of innovation or new technology, will provide
1607	equivalent or better products or methods or systems of
1608	construction.
1609	4.  Does not discriminate against materials, products,
1610	methods, or systems of construction of demonstrated
1611	capabilities.
1612	5.  Does not degrade the effectiveness of the Florida
1613	Building Code.
1614
1615	Furthermore, the Florida Building Commission may approve
1616	technical amendments to the code once each year to incorporate
1617	into the Florida Building Code its own interpretations of the
1618	code which are embodied in its opinions, final orders,
1619	declaratory statements, and interpretations of hearing officer
1620	panels under s. 553.775(3)(c), but shall do so only to the
1621	extent that incorporation of interpretations is needed to modify
1622	the foundation codes to accommodate the specific needs of this
1623	state. Amendments approved under this paragraph shall be adopted
1624	by rule pursuant to ss. 120.536(1) and 120.54, after the
1625	amendments have been subjected to the provisions of subsection
1626	(3).
1627	(b)  A proposed amendment shall include a fiscal impact
1628	statement which documents the costs and benefits of the proposed
1629	amendment.  Criteria for the fiscal impact statement shall be
1630	established by rule by the commission and shall include the
1631	impact to local government relative to enforcement, the impact
1632	to property and building owners, as well as to industry,
1633	relative to the cost of compliance.
1634	(c)  The commission may not approve any proposed amendment
1635	that does not accurately and completely address all requirements
1636	for amendment which are set forth in this section. The
1637	commission shall require all proposed amendments and information
1638	submitted with proposed amendments to be reviewed by commission
1639	staff prior to consideration by any technical advisory
1640	committee. These reviews shall be for sufficiency only and are
1641	not intended to be qualitative in nature. Staff members shall
1642	reject any proposed amendment that fails to include a fiscal
1643	impact statement. Proposed amendments rejected by members of the
1644	staff may not be considered by the commission or any technical
1645	advisory committee.
1646	(d)  Provisions of the Florida Building Code, including
1647	those contained in referenced standards and criteria, relating
1648	to wind resistance or the prevention of water intrusion may not
1649	be amended pursuant to this subsection to diminish those
1650	construction requirements; however, the commission may, subject
1651	to conditions in this subsection, amend the provisions to
1652	enhance those construction requirements.
1653	(9)(8)  The following buildings, structures, and facilities
1654	are exempt from the Florida Building Code as provided by law,
1655	and any further exemptions shall be as determined by the
1656	Legislature and provided by law:
1657	(a)  Buildings and structures specifically regulated and
1658	preempted by the Federal Government.
1659	(b)  Railroads and ancillary facilities associated with the
1660	railroad.
1661	(c)  Nonresidential farm buildings on farms.
1662	(d)  Temporary buildings or sheds used exclusively for
1663	construction purposes.
1664	(e)  Mobile or modular structures used as temporary
1665	offices, except that the provisions of part II relating to
1666	accessibility by persons with disabilities shall apply to such
1667	mobile or modular structures.
1668	(f)  Those structures or facilities of electric utilities,
1669	as defined in s. 366.02, which are directly involved in the
1670	generation, transmission, or distribution of electricity.
1671	(g)  Temporary sets, assemblies, or structures used in
1672	commercial motion picture or television production, or any
1673	sound-recording equipment used in such production, on or off the
1674	premises.
1675	(h)  Storage sheds that are not designed for human
1676	habitation and that have a floor area of 720 square feet or less
1677	are not required to comply with the mandatory wind-borne-debris-
1678	impact standards of the Florida Building Code.
1679	(i)  Chickees constructed by the Miccosukee Tribe of
1680	Indians of Florida or the Seminole Tribe of Florida. As used in
1681	this paragraph, the term "chickee" means an open-sided wooden
1682	hut that has a thatched roof of palm or palmetto or other
1683	traditional materials, and that does not incorporate any
1684	electrical, plumbing, or other nonwood features.
1685
1686	With the exception of paragraphs (a), (b), (c), and (f), in
1687	order to preserve the health, safety, and welfare of the public,
1688	the Florida Building Commission may, by rule adopted pursuant to
1689	chapter 120, provide for exceptions to the broad categories of
1690	buildings exempted in this section, including exceptions for
1691	application of specific sections of the code or standards
1692	adopted therein. The Department of Agriculture and Consumer
1693	Services shall have exclusive authority to adopt by rule,
1694	pursuant to chapter 120, exceptions to nonresidential farm
1695	buildings exempted in paragraph (c) when reasonably necessary to
1696	preserve public health, safety, and welfare. The exceptions must
1697	be based upon specific criteria, such as under-roof floor area,
1698	aggregate electrical service capacity, HVAC system capacity, or
1699	other building requirements. Further, the commission may
1700	recommend to the Legislature additional categories of buildings,
1701	structures, or facilities which should be exempted from the
1702	Florida Building Code, to be provided by law.
1703	(10)(9)(a)  In the event of a conflict between the Florida
1704	Building Code and the Florida Fire Prevention Code and the Life
1705	Safety Code as applied to a specific project, the conflict shall
1706	be resolved by agreement between the local building code
1707	enforcement official and the local fire code enforcement
1708	official in favor of the requirement of the code which offers
1709	the greatest degree of lifesafety or alternatives which would
1710	provide an equivalent degree of lifesafety and an equivalent
1711	method of construction.
1712	(b)  Any decision made by the local fire official and the
1713	local building official may be appealed to a local
1714	administrative board designated by the municipality, county, or
1715	special district having firesafety responsibilities. If the
1716	decision of the local fire official and the local building
1717	official is to apply the provisions of either the Florida
1718	Building Code or the Florida Fire Prevention Code and the Life
1719	Safety Code, the board may not alter the decision unless the
1720	board determines that the application of such code is not
1721	reasonable.  If the decision of the local fire official and the
1722	local building official is to adopt an alternative to the codes,
1723	the local administrative board shall give due regard to the
1724	decision rendered by the local officials and may modify that
1725	decision if the administrative board adopts a better
1726	alternative, taking into consideration all relevant
1727	circumstances.  In any case in which the local administrative
1728	board adopts alternatives to the decision rendered by the local
1729	fire official and the local building official, such alternatives
1730	shall provide an equivalent degree of lifesafety and an
1731	equivalent method of construction as the decision rendered by
1732	the local officials.
1733	(c)  If the local building official and the local fire
1734	official are unable to agree on a resolution of the conflict
1735	between the Florida Building Code and the Florida Fire
1736	Prevention Code and the Life Safety Code, the local
1737	administrative board shall resolve the conflict in favor of the
1738	code which offers the greatest degree of lifesafety or
1739	alternatives which would provide an equivalent degree of
1740	lifesafety and an equivalent method of construction.
1741	(d)  All decisions of the local administrative board, or if
1742	none exists, the decisions of the local building official and
1743	the local fire official, are subject to review by a joint
1744	committee composed of members of the Florida Building Commission
1745	and the Fire Code Advisory Council. If the joint committee is
1746	unable to resolve conflicts between the codes as applied to a
1747	specific project, the matter shall be resolved pursuant to the
1748	provisions of paragraph (1)(d).
1749	(e)  The local administrative board shall, to the greatest
1750	extent possible, be composed of members with expertise in
1751	building construction and firesafety standards.
1752	(f)  All decisions of the local building official and local
1753	fire official and all decisions of the administrative board
1754	shall be in writing and shall be binding upon all persons but
1755	shall not limit the authority of the State Fire Marshal or the
1756	Florida Building Commission pursuant to paragraph (1)(d) and ss.
1757	663.01 and 633.161. Decisions of general application shall be
1758	indexed by building and fire code sections and shall be
1759	available for inspection during normal business hours.
1760	(11)(10)  Except within coastal building zones as defined
1761	in s. 161.54, specification standards developed by nationally
1762	recognized code promulgation organizations to determine
1763	compliance with engineering criteria of the Florida Building
1764	Code for wind load design shall not apply to one or two family
1765	dwellings which are two stories or less in height unless
1766	approved by the commission for use or unless expressly made
1767	subject to said standards and criteria by local ordinance
1768	adopted in accordance with the provisions of subsection (4).
1769	(12)(11)  The Florida Building Code does not apply to, and
1770	no code enforcement action shall be brought with respect to,
1771	zoning requirements, land use requirements, and owner
1772	specifications or programmatic requirements which do not pertain
1773	to and govern the design, construction, erection, alteration,
1774	modification, repair, or demolition of public or private
1775	buildings, structures, or facilities or to programmatic
1776	requirements that do not pertain to enforcement of the Florida
1777	Building Code.  Additionally, a local code enforcement agency
1778	may not administer or enforce the Florida Building Code to
1779	prevent the siting of any publicly owned facility, including,
1780	but not limited to, correctional facilities, juvenile justice
1781	facilities, or state universities, community colleges, or public
1782	education facilities, as provided by law.
1783	Section 8.  Subsection (2) of section 553.775, Florida
1784	Statutes, is amended to read:
1785	553.775  Interpretations.--
1786	(2)  Local enforcement agencies, local building officials,
1787	state agencies, and the commission shall interpret provisions of
1788	the Florida Building Code in a manner that is consistent with
1789	declaratory statements and interpretations entered by the
1790	commission, except that conflicts between the Florida Fire
1791	Prevention Code and the Florida Building Code shall be resolved
1792	in accordance with s. 553.73(10)(c) and (d) s. 553.73(9)(c) and
1793	(d).
1794	Section 9.  Upon the effective date of this act, each
1795	jurisdiction having authority to enforce the Florida Building
1796	Code shall, at a minimum, require wind-borne-debris protection
1797	in accordance with s. 1609.1, International Building Code (2006)
1798	and the International Residential Code (2006) within the "wind-
1799	borne-debris region" as that term is defined in s. 1609.2,
1800	International Building Code (2006), and s. R301.2, International
1801	Residential Code (2006).
1802	Section 10.  (1)  The Florida Building Commission shall
1803	amend the Florida Building Code to reflect the application of
1804	provisions identified in section 9 of this act, and to eliminate
1805	all exceptions that provide less stringent requirements. The
1806	amendments by the commission shall apply throughout the state
1807	with the exception of the High Velocity Hurricane Zone, which
1808	shall be governed as currently provided within the Florida
1809	Building Code. The commission shall fulfill these obligations
1810	before July 1, 2007, pursuant only to the provisions of chapter
1811	120, Florida Statutes.
1812	(2)  The Florida Building Commission shall develop
1813	voluntary "Code Plus" guidelines for increasing the hurricane
1814	resistance of buildings. The guidelines may be modeled on the
1815	requirements for the High Velocity Hurricane Zone and must
1816	identify products, systems, and methods of construction that the
1817	commission anticipates could result in stronger construction.
1818	The commission shall include these guidelines in its report to
1819	the 2008 Legislature.
1820	Section 11.  Subsection (1) of section 624.407, Florida
1821	Statutes, is amended to read:
1822	624.407  Capital funds required; new insurers.--
1823	(1)  To receive authority to transact any one kind or
1824	combinations of kinds of insurance, as defined in part V of this
1825	chapter, an insurer applying for its original certificate of
1826	authority in this state after the effective date of this section
1827	shall possess surplus as to policyholders not less than the
1828	greater of:
1829	(a)  Five million dollars for a property and casualty
1830	insurer, or $2.5 million for any other insurer;
1831	(b)  For life insurers, 4 percent of the insurer's total
1832	liabilities;
1833	(c)  For life and health insurers, 4 percent of the
1834	insurer's total liabilities, plus 6 percent of the insurer's
1835	liabilities relative to health insurance; or
1836	(d)  For all insurers other than life insurers and life and
1837	health insurers, 10 percent of the insurer's total liabilities;
1838
1839	however, a domestic insurer that transacts residential property
1840	insurance and is a wholly owned subsidiary of an insurer
1841	authorized to do business in any other state shall possess
1842	surplus as to policyholders of at least $50 million, but no
1843	insurer shall be required under this subsection to have surplus
1844	as to policyholders greater than $100 million.
1845	Section 12.  Paragraph (a) of subsection (2) of section
1846	624.462, Florida Statutes, is amended to read:
1847	624.462  Commercial self-insurance funds.--
1848	(2)  As used in ss. 624.460-624.488, "commercial self-
1849	insurance fund" or "fund" means a group of members, operating
1850	individually and collectively through a trust or corporation,
1851	that must be:
1852	(a)  Established by:
1853	1.  A not-for-profit trade association, industry
1854	association, or professional association of employers or
1855	professionals which has a constitution or bylaws, which is
1856	incorporated under the laws of this state, and which has been
1857	organized for purposes other than that of obtaining or providing
1858	insurance and operated in good faith for a continuous period of
1859	1 year;
1860	2.  A self-insurance trust fund organized pursuant to s.
1861	627.357 and maintained in good faith for a continuous period of
1862	1 year for purposes other than that of obtaining or providing
1863	insurance pursuant to this section. Each member of a commercial
1864	self-insurance trust fund established pursuant to this
1865	subsection must maintain membership in the self-insurance trust
1866	fund organized pursuant to s. 627.357;
1867	3.  A group of 10 or more health care providers, as defined
1868	in s. 627.351(4)(h), for purposes of providing medical
1869	malpractice coverage; or
1870	4.  A not-for-profit group comprised of one or more
1871	community no less than 10 condominium associations responsible
1872	for operating at least 50 residential parcels or units created
1873	and operating under chapter 718, chapter 719, chapter 720,
1874	chapter 721, or chapter 723 as defined in s. 718.103(2), which
1875	is incorporated under the laws of this state, which restricts
1876	its membership to community condominium associations only, and
1877	which has been organized and maintained in good faith for the
1878	purpose of pooling and spreading the liabilities of its group
1879	members relating to property or casualty risk or surety a
1880	continuous period of 1 year for purposes other than that of
1881	obtaining or providing insurance.
1882	Section 13.  Subsection (1) of section 624.4622, Florida
1883	Statutes, is amended to read:
1884	624.4622  Local government self-insurance funds.--
1885	(1)  Any two or more local governmental entities may enter
1886	into interlocal agreements for the purpose of securing the
1887	payment of benefits under chapter 440, or insuring or self-
1888	insuring real or personal property of every kind and every
1889	interest in such property against loss or damage from any hazard
1890	or cause and against any loss consequential to such loss or
1891	damage, provided the local government self-insurance fund that
1892	is created must:
1893	(a)  Have annual normal premiums in excess of $5 million;
1894	(b)  Maintain a continuing program of excess insurance
1895	coverage and reserve evaluation to protect the financial
1896	stability of the fund in an amount and manner determined by a
1897	qualified and independent actuary;
1898	(c)  Submit annually an audited fiscal year-end financial
1899	statement by an independent certified public accountant within 6
1900	months after the end of the fiscal year to the office; and
1901	(d)  Have a governing body which is comprised entirely of
1902	local elected officials.
1903	Section 14.  Section 624.4625, Florida Statutes, is created
1904	to read:
1905	624.4625 Corporation not-for-profit self-insurance funds.--
1906	(1) Notwithstanding any other provision of law, any two or
1907	more corporations not for profit located in and organized under
1908	the laws of this state may form a self-insurance fund for the
1909	purpose of pooling and spreading liabilities of its group
1910	members in any one or combination of property or casualty risk,
1911	provided the corporation not for profit self-insurance fund that
1912	is created:
1913	(a) Has annual normal premiums in excess of $5 million.
1914	(b) Requires for qualification that each participating
1915	member receive at least 75 percent of its revenues from local,
1916	state, or federal governmental sources or a combination of such
1917	sources.
1918	(c) Uses a qualified actuary to determine rates using
1919	accepted actuarial principles and annually submits to the office
1920	a certification by the actuary that the rates are actuarially
1921	sound and are not inadequate, as defined in s. 627.062.
1922	(d) Uses a qualified actuary to establish reserves for loss
1923	and loss adjustment expenses and annually submits to the office
1924	a certification by the actuary that the loss and loss adjustment
1925	expense reserves are adequate. If the actuary determines that
1926	reserves are not adequate, the fund shall file with the office a
1927	remedial plan for increasing the reserves or otherwise
1928	addressing the financial condition of the fund, subject to a
1929	determination by the office that the fund will operate on an
1930	actuarially sound basis and the fund does not pose a significant
1931	risk of insolvency.
1932	(e) Maintains a continuing program of excess insurance
1933	coverage and reserve evaluation to protect the financial
1934	stability of the fund in an amount and manner determined by a
1935	qualified actuary. At a minimum, this program must:
1936	1.  Purchase excess insurance from authorized insurance
1937	carriers.
1938	2.  Retain a per-loss occurrence that does not exceed
1939	$350,000.
1940	(f)  Submits to the office annually an audited fiscal year-
1941	end financial statement by an independent certified public
1942	accountant within 6 months after the end of the fiscal year.
1943	(g)  Has a governing body that is comprised entirely of
1944	officials from corporations not for profit that are members of
1945	the corporation not-for-profit self-insurance fund.
1946	(h)  Uses knowledgeable persons or business entities to
1947	administer or service the fund in the areas of claims
1948	administration, claims adjusting, underwriting, risk management,
1949	loss control, policy administration, financial audit, and legal
1950	areas. Such persons must meet all applicable requirements of law
1951	for state licensure and must have at least 5 years' experience
1952	with commercial self-insurance funds formed under s. 624.462,
1953	self-insurance funds formed under s. 624.4622, or domestic
1954	insurers.
1955	(i)  Submits to the office copies of contracts used for its
1956	members that clearly establish the liability of each member for
1957	the obligations of the fund.
1958	(j)  Annually submits to the office a certification by the
1959	governing body of the fund that, to the best of its knowledge,
1960	the requirements of this section are met.
1961	(2)  As used in this section, the term "qualified actuary"
1962	means an actuary that is a member of the Casualty Actuarial
1963	Society or the American Academy of Actuaries.
1964	(3)  A corporation not-for-profit self-insurance fund that
1965	meets the requirements of this section is not:
1966	(a)  An insurer for purposes of participation in or
1967	coverage by any insurance guaranty association established by
1968	chapter 631; or
1969	(b)  Subject to s. 624.4621 and is not required to file any
1970	report with the department under s. 440.38(2)(b) that is
1971	uniquely required of group self-insurer funds qualified under s.
1972	624.4621.
1973	(4)  Premiums, contributions, and assessments received by a
1974	corporation not-for-profit self-insurance fund are subject to
1975	ss. 624.509(1) and (2) and 624.5092, except that the tax rate
1976	shall be 1.6 percent of the gross amount of such premiums,
1977	contributions, and assessments.
1978	(5)  If any of the requirements of subsection (1) are not
1979	met, a corporation not-for-profit self-insurance fund is subject
1980	to the requirements of s. 624.4621 if the fund provides only
1981	workers' compensation coverage or is subject to the requirements
1982	of ss. 624.460-624.488 if the fund provides coverage for other
1983	property, casualty, or surety risks.
1984	Section 15.  Subsection (3) of section 624.610, Florida
1985	Statutes, is amended to read:
1986	624.610  Reinsurance.--
1987	(3)(a)  Credit must be allowed when the reinsurance is
1988	ceded to an assuming insurer that is authorized to transact
1989	insurance or reinsurance in this state.
1990	(b)1.  Credit must be allowed when the reinsurance is ceded
1991	to an assuming insurer that is accredited as a reinsurer in this
1992	state. An accredited reinsurer is one that:
1993	a.  Files with the office evidence of its submission to
1994	this state's jurisdiction;
1995	b.  Submits to this state's authority to examine its books
1996	and records;
1997	c.  Is licensed or authorized to transact insurance or
1998	reinsurance in at least one state or, in the case of a United
1999	States branch of an alien assuming insurer, is entered through,
2000	licensed, or authorized to transact insurance or reinsurance in
2001	at least one state;
2002	d.  Files annually with the office a copy of its annual
2003	statement filed with the insurance department of its state of
2004	domicile any quarterly statements if required by its state of
2005	domicile or such quarterly statements if specifically requested
2006	by the office, and a copy of its most recent audited financial
2007	statement; and
2008	(I)  Maintains a surplus as regards policyholders in an
2009	amount not less than $20 million and whose accreditation has not
2010	been denied by the office within 90 days after its submission;
2011	or
2012	(II)  Maintains a surplus as regards policyholders in an
2013	amount not less than $20 million and whose accreditation has
2014	been approved by the office.
2015	2.  The office may deny or revoke an assuming insurer's
2016	accreditation if the assuming insurer does not submit the
2017	required documentation pursuant to subparagraph 1., if the
2018	assuming insurer fails to meet all of the standards required of
2019	an accredited reinsurer, or if the assuming insurer's
2020	accreditation would be hazardous to the policyholders of this
2021	state. In determining whether to deny or revoke accreditation,
2022	the office may consider the qualifications of the assuming
2023	insurer with respect to all the following subjects:
2024	a.  Its financial stability;
2025	b.  The lawfulness and quality of its investments;
2026	c.  The competency, character, and integrity of its
2027	management;
2028	d.  The competency, character, and integrity of persons who
2029	own or have a controlling interest in the assuming insurer; and
2030	e.  Whether claims under its contracts are promptly and
2031	fairly adjusted and are promptly and fairly paid in accordance
2032	with the law and the terms of the contracts.
2033	3.  Credit must not be allowed a ceding insurer if the
2034	assuming insurer's accreditation has been revoked by the office
2035	after notice and the opportunity for a hearing.
2036	4.  The actual costs and expenses incurred by the office to
2037	review a reinsurer's request for accreditation and subsequent
2038	reviews must be charged to and collected from the requesting
2039	reinsurer. If the reinsurer fails to pay the actual costs and
2040	expenses promptly when due, the office may refuse to accredit
2041	the reinsurer or may revoke the reinsurer's accreditation.
2042	(c)1.  Credit must be allowed when the reinsurance is ceded
2043	to an assuming insurer that maintains a trust fund in a
2044	qualified United States financial institution, as defined in
2045	paragraph (5)(b), for the payment of the valid claims of its
2046	United States ceding insurers and their assigns and successors
2047	in interest. To enable the office to determine the sufficiency
2048	of the trust fund, the assuming insurer shall report annually to
2049	the office information substantially the same as that required
2050	to be reported on the NAIC Annual Statement form by authorized
2051	insurers. The assuming insurer shall submit to examination of
2052	its books and records by the office and bear the expense of
2053	examination.
2054	2.a.  Credit for reinsurance must not be granted under this
2055	subsection unless the form of the trust and any amendments to
2056	the trust have been approved by:
2057	(I)  The insurance regulator of the state in which the
2058	trust is domiciled; or
2059	(II)  The insurance regulator of another state who,
2060	pursuant to the terms of the trust instrument, has accepted
2061	principal regulatory oversight of the trust.
2062	b.  The form of the trust and any trust amendments must be
2063	filed with the insurance regulator of every state in which the
2064	ceding insurer beneficiaries of the trust are domiciled. The
2065	trust instrument must provide that contested claims are valid
2066	and enforceable upon the final order of any court of competent
2067	jurisdiction in the United States. The trust must vest legal
2068	title to its assets in its trustees for the benefit of the
2069	assuming insurer's United States ceding insurers and their
2070	assigns and successors in interest. The trust and the assuming
2071	insurer are subject to examination as determined by the
2072	insurance regulator.
2073	c.  The trust remains in effect for as long as the assuming
2074	insurer has outstanding obligations due under the reinsurance
2075	agreements subject to the trust. No later than February 28 of
2076	each year, the trustee of the trust shall report to the
2077	insurance regulator in writing the balance of the trust and list
2078	the trust's investments at the preceding year end, and shall
2079	certify that the trust will not expire prior to the following
2080	December 31.
2081	3.  The following requirements apply to the following
2082	categories of assuming insurer:
2083	a.  The trust fund for a single assuming insurer consists
2084	of funds in trust in an amount not less than the assuming
2085	insurer's liabilities attributable to reinsurance ceded by
2086	United States ceding insurers, and, in addition, the assuming
2087	insurer shall maintain a trusteed surplus of not less than $20
2088	million. Not less than 50 percent of the funds in the trust
2089	covering the assuming insurer's liabilities attributable to
2090	reinsurance ceded by United States ceding insurers and trusteed
2091	surplus shall consist of assets of a quality substantially
2092	similar to that required in part II of chapter 625. Clean,
2093	irrevocable, unconditional, and evergreen letters of credit,
2094	issued or confirmed by a qualified United States financial
2095	institution, as defined in paragraph (5)(a), effective no later
2096	than December 31 of the year for which the filing is made and in
2097	the possession of the trust on or before the filing date of its
2098	annual statement, may be used to fund the remainder of the trust
2099	and trusteed surplus.
2100	b.(I)  In the case of a group including incorporated and
2101	individual unincorporated underwriters:
2102	(A)  For reinsurance ceded under reinsurance agreements
2103	with an inception, amendment, or renewal date on or after August
2104	1, 1995, the trust consists of a trusteed account in an amount
2105	not less than the group's several liabilities attributable to
2106	business ceded by United States domiciled ceding insurers to any
2107	member of the group;
2108	(B)  For reinsurance ceded under reinsurance agreements
2109	with an inception date on or before July 31, 1995, and not
2110	amended or renewed after that date, notwithstanding the other
2111	provisions of this section, the trust consists of a trusteed
2112	account in an amount not less than the group's several insurance
2113	and reinsurance liabilities attributable to business written in
2114	the United States; and
2115	(C)  In addition to these trusts, the group shall maintain
2116	in trust a trusteed surplus of which $100 million must be held
2117	jointly for the benefit of the United States domiciled ceding
2118	insurers of any member of the group for all years of account.
2119	(II)  The incorporated members of the group must not be
2120	engaged in any business other than underwriting of a member of
2121	the group, and are subject to the same level of regulation and
2122	solvency control by the group's domiciliary regulator as the
2123	unincorporated members.
2124	(III)  Within 90 days after its financial statements are
2125	due to be filed with the group's domiciliary regulator, the
2126	group shall provide to the insurance regulator an annual
2127	certification by the group's domiciliary regulator of the
2128	solvency of each underwriter member or, if a certification is
2129	unavailable, financial statements, prepared by independent
2130	public accountants, of each underwriter member of the group.
2131	(d)  Credit must be allowed when the reinsurance is ceded
2132	to an assuming insurer not meeting the requirements of paragraph
2133	(a), paragraph (b), or paragraph (c), but only as to the
2134	insurance of risks located in jurisdictions in which the
2135	reinsurance is required to be purchased by a particular entity
2136	by applicable law or regulation of that jurisdiction.
2137	(e)  If the reinsurance is ceded to an assuming insurer not
2138	meeting the requirements of paragraph (a), paragraph (b),
2139	paragraph (c), or paragraph (d), the commissioner may allow
2140	credit, but only if the assuming insurer holds surplus in excess
2141	of $100 million and has a secure financial strength rating from
2142	at least two nationally recognized statistical rating
2143	organizations deemed acceptable by the commissioner. In
2144	determining whether credit should be allowed, the commissioner
2145	shall consider the following:
2146	1.  The domiciliary regulatory jurisdiction of the assuming
2147	insurer.
2148	2.  The structure and authority of the domiciliary
2149	regulator with regard to solvency regulation requirements and
2150	the financial surveillance of the reinsurer.
2151	3.  The substance of financial and operating standards for
2152	reinsurers in the domiciliary jurisdiction.
2153	4.  The form and substance of financial reports required to
2154	be filed by the reinsurers in the domiciliary jurisdiction or
2155	other public financial statements filed in accordance with
2156	generally accepted accounting principles.
2157	5.  The domiciliary regulator's willingness to cooperate
2158	with United States regulators in general and the office in
2159	particular.
2160	6.  The history of performance by reinsurers in the
2161	domiciliary jurisdiction.
2162	7.  Any documented evidence of substantial problems with
2163	the enforcement of valid United States judgments in the
2164	domiciliary jurisdiction.
2165	8.  Any other matters deemed relevant by the commissioner.
2166	The commissioner shall give appropriate consideration to insurer
2167	group ratings that may have been issued. The commissioner may,
2168	in lieu of granting full credit under this subsection, reduce
2169	the amount required to be held in trust under paragraph (c).
2170	(f)(e)  If the assuming insurer is not authorized or
2171	accredited to transact insurance or reinsurance in this state
2172	pursuant to paragraph (a) or paragraph (b), the credit permitted
2173	by paragraph (c) or paragraph (d) must not be allowed unless the
2174	assuming insurer agrees in the reinsurance agreements:
2175	1.a.  That in the event of the failure of the assuming
2176	insurer to perform its obligations under the terms of the
2177	reinsurance agreement, the assuming insurer, at the request of
2178	the ceding insurer, shall submit to the jurisdiction of any
2179	court of competent jurisdiction in any state of the United
2180	States, will comply with all requirements necessary to give the
2181	court jurisdiction, and will abide by the final decision of the
2182	court or of any appellate court in the event of an appeal; and
2183	b.  To designate the Chief Financial Officer, pursuant to
2184	s. 48.151, or a designated attorney as its true and lawful
2185	attorney upon whom may be served any lawful process in any
2186	action, suit, or proceeding instituted by or on behalf of the
2187	ceding company.
2188	2.  This paragraph is not intended to conflict with or
2189	override the obligation of the parties to a reinsurance
2190	agreement to arbitrate their disputes, if this obligation is
2191	created in the agreement.
2192	(g)(f)  If the assuming insurer does not meet the
2193	requirements of paragraph (a) or paragraph (b), the credit
2194	permitted by paragraph (c) or paragraph (d) is not allowed
2195	unless the assuming insurer agrees in the trust agreements, in
2196	substance, to the following conditions:
2197	1.  Notwithstanding any other provisions in the trust
2198	instrument, if the trust fund is inadequate because it contains
2199	an amount less than the amount required by paragraph (c), or if
2200	the grantor of the trust has been declared insolvent or placed
2201	into receivership, rehabilitation, liquidation, or similar
2202	proceedings under the laws of its state or country of domicile,
2203	the trustee shall comply with an order of the insurance
2204	regulator with regulatory oversight over the trust or with an
2205	order of a United States court of competent jurisdiction
2206	directing the trustee to transfer to the insurance regulator
2207	with regulatory oversight all of the assets of the trust fund.
2208	2.  The assets must be distributed by and claims must be
2209	filed with and valued by the insurance regulator with regulatory
2210	oversight in accordance with the laws of the state in which the
2211	trust is domiciled which are applicable to the liquidation of
2212	domestic insurance companies.
2213	3.  If the insurance regulator with regulatory oversight
2214	determines that the assets of the trust fund or any part thereof
2215	are not necessary to satisfy the claims of the United States
2216	ceding insurers of the grantor of the trust, the assets or part
2217	thereof must be returned by the insurance regulator with
2218	regulatory oversight to the trustee for distribution in
2219	accordance with the trust agreement.
2220	4.  The grantor shall waive any right otherwise available
2221	to it under United States law which is inconsistent with this
2222	provision.
2223	Section 16.  Paragraph (a) of subsection (3) of section
2224	626.2815, Florida Statutes, is amended to read:
2225	626.2815  Continuing education required; application;
2226	exceptions; requirements; penalties.--
2227	(3)(a)  Each person subject to the provisions of this
2228	section must, except as set forth in paragraphs (b), (c), and
2229	(d), complete a minimum of 24 hours of continuing education
2230	courses every 2 years in basic or higher-level courses
2231	prescribed by this section or in other courses approved by the
2232	department. Each person subject to the provisions of this
2233	section must complete, as part of his or her required number of
2234	continuing education hours, 3 hours of continuing education,
2235	approved by the department, every 2 years on the subject matter
2236	of ethics. Each licensed general lines agent and customer
2237	representative subject to this section must complete, as part of
2238	his or her required number of continuing education hours, 1 hour
2239	of continuing education, approved by the department, every 2
2240	years on the subject matter of premium discounts available on
2241	property insurance policies based on various hurricane
2242	mitigation options and the means for obtaining the discounts.
2243	Section 17.  Section 627.0613, Florida Statutes, is amended
2244	to read:
2245	627.0613  Consumer advocate.--The Chief Financial Officer
2246	must appoint a consumer advocate who must represent the general
2247	public of the state before the department and the office. The
2248	consumer advocate must report directly to the Chief Financial
2249	Officer, but is not otherwise under the authority of the
2250	department or of any employee of the department. The consumer
2251	advocate has such powers as are necessary to carry out the
2252	duties of the office of consumer advocate, including, but not
2253	limited to, the powers to:
2254	(1)  Recommend to the department or office, by petition,
2255	the commencement of any proceeding or action; appear in any
2256	proceeding or action before the department or office; or appear
2257	in any proceeding before the Division of Administrative Hearings
2258	or arbitration panel specified in s. 627.062(6) relating to
2259	subject matter under the jurisdiction of the department or
2260	office.
2261	(2)  Have access to and use of all files, records, and data
2262	of the department or office.
2263	(3)  Examine rate and form filings submitted to the office,
2264	hire consultants as necessary to aid in the review process, and
2265	recommend to the department or office any position deemed by the
2266	consumer advocate to be in the public interest.
2267	(4)  Prepare an annual report card for each authorized
2268	property insurer, on a form and using a letter-grade scale
2269	developed by the commission by rule, which grades each insurer
2270	based on the following factors:
2271	1.  The number and nature of consumer complaints received
2272	by the department against the insurer.
2273	2.  The disposition of all complaints received by the
2274	department.
2275	3.  The average length of time for payment of claims by the
2276	insurer.
2277	4.  Any other factors the commission identifies as
2278	assisting policyholders in making informed choices about
2279	homeowner's insurance.
2280	(5)(4)  Prepare an annual budget for presentation to the
2281	Legislature by the department, which budget must be adequate to
2282	carry out the duties of the office of consumer advocate.
2283	Section 18.  Subsection (2) and paragraph (a) of subsection
2284	(6) of section 627.062, Florida Statutes, are amended, present
2285	subsection (9) of that section is redesignated as subsection
2286	(10), and a new subsection (9) is added to that section, to
2287	read:
2288	627.062  Rate standards.--
2289	(2)  As to all such classes of insurance:
2290	(a)  Insurers or rating organizations shall establish and
2291	use rates, rating schedules, or rating manuals to allow the
2292	insurer a reasonable rate of return on such classes of insurance
2293	written in this state.  A copy of rates, rating schedules,
2294	rating manuals, premium credits or discount schedules, and
2295	surcharge schedules, and changes thereto, shall be filed with
2296	the office under one of the following procedures except as
2297	provided in subparagraph 3.:
2298	1.  If the filing is made at least 90 days before the
2299	proposed effective date and the filing is not implemented during
2300	the office's review of the filing and any proceeding and
2301	judicial review, then such filing shall be considered a "file
2302	and use" filing.  In such case, the office shall finalize its
2303	review by issuance of a notice of intent to approve or a notice
2304	of intent to disapprove within 90 days after receipt of the
2305	filing. The notice of intent to approve and the notice of intent
2306	to disapprove constitute agency action for purposes of the
2307	Administrative Procedure Act. Requests for supporting
2308	information, requests for mathematical or mechanical
2309	corrections, or notification to the insurer by the office of its
2310	preliminary findings shall not toll the 90-day period during any
2311	such proceedings and subsequent judicial review. The rate shall
2312	be deemed approved if the office does not issue a notice of
2313	intent to approve or a notice of intent to disapprove within 90
2314	days after receipt of the filing.
2315	2.  If the filing is not made in accordance with the
2316	provisions of subparagraph 1., such filing shall be made as soon
2317	as practicable, but no later than 30 days after the effective
2318	date, and shall be considered a "use and file" filing.  An
2319	insurer making a "use and file" filing is potentially subject to
2320	an order by the office to return to policyholders portions of
2321	rates found to be excessive, as provided in paragraph (h).
2322	3.  For all filings made on or before December 31, 2008, an
2323	insurer seeking a rate that is greater than the rate most
2324	recently approved by the office shall make a "file and use"
2325	filing.
2326	(b)  Upon receiving a rate filing, the office shall review
2327	the rate filing to determine if a rate is excessive, inadequate,
2328	or unfairly discriminatory.  In making that determination, the
2329	office shall, in accordance with generally accepted and
2330	reasonable actuarial techniques, consider the following factors:
2331	1.  Past and prospective loss experience within and without
2332	this state.
2333	2.  Past and prospective expenses.
2334	3.  The degree of competition among insurers for the risk
2335	insured.
2336	4.  Investment income reasonably expected by the insurer,
2337	consistent with the insurer's investment practices, from
2338	investable premiums anticipated in the filing, plus any other
2339	expected income from currently invested assets representing the
2340	amount expected on unearned premium reserves and loss reserves.
2341	The commission may adopt rules utilizing reasonable techniques
2342	of actuarial science and economics to specify the manner in
2343	which insurers shall calculate investment income attributable to
2344	such classes of insurance written in this state and the manner
2345	in which such investment income shall be used in the calculation
2346	of insurance rates.  Such manner shall contemplate allowances
2347	for an underwriting profit factor and full consideration of
2348	investment income which produce a reasonable rate of return;
2349	however, investment income from invested surplus shall not be
2350	considered.
2351	5.  The reasonableness of the judgment reflected in the
2352	filing.
2353	6.  Dividends, savings, or unabsorbed premium deposits
2354	allowed or returned to Florida policyholders, members, or
2355	subscribers.
2356	7.  The adequacy of loss reserves.
2357	8.  The cost of reinsurance.
2358	9.  Trend factors, including trends in actual losses per
2359	insured unit for the insurer making the filing.
2360	10.  Conflagration and catastrophe hazards, if applicable.
2361	11.  A reasonable margin for underwriting profit and
2362	contingencies. For that portion of the rate covering the risk of
2363	hurricanes and other catastrophic losses for which the insurer
2364	has not purchased reinsurance and has exposed its capital and
2365	surplus to such risk, the office must approve a rating factor
2366	that provides the insurer a reasonable rate of return that is
2367	commensurate with such risk.
2368	12.  The cost of medical services, if applicable.
2369	13.  Other relevant factors which impact upon the frequency
2370	or severity of claims or upon expenses.
2371	(c)  In the case of fire insurance rates, consideration
2372	shall be given to the availability of water supplies and the
2373	experience of the fire insurance business during a period of not
2374	less than the most recent 5-year period for which such
2375	experience is available.
2376	(d)  If conflagration or catastrophe hazards are given
2377	consideration by an insurer in its rates or rating plan,
2378	including surcharges and discounts, the insurer shall establish
2379	a reserve for that portion of the premium allocated to such
2380	hazard and shall maintain the premium in a catastrophe reserve.
2381	Any removal of such premiums from the reserve for purposes other
2382	than paying claims associated with a catastrophe or purchasing
2383	reinsurance for catastrophes shall be subject to approval of the
2384	office.  Any ceding commission received by an insurer purchasing
2385	reinsurance for catastrophes shall be placed in the catastrophe
2386	reserve.
2387	(e)  After consideration of the rate factors provided in
2388	paragraphs (b), (c), and (d), a rate may be found by the office
2389	to be excessive, inadequate, or unfairly discriminatory based
2390	upon the following standards:
2391	1.  Rates shall be deemed excessive if they are likely to
2392	produce a profit from Florida business that is unreasonably high
2393	in relation to the risk involved in the class of business or if
2394	expenses are unreasonably high in relation to services rendered.
2395	2.  Rates shall be deemed excessive if, among other things,
2396	the rate structure established by a stock insurance company
2397	provides for replenishment of surpluses from premiums, when the
2398	replenishment is attributable to investment losses.
2399	3.  Rates shall be deemed inadequate if they are clearly
2400	insufficient, together with the investment income attributable
2401	to them, to sustain projected losses and expenses in the class
2402	of business to which they apply.
2403	4.  A rating plan, including discounts, credits, or
2404	surcharges, shall be deemed unfairly discriminatory if it fails
2405	to clearly and equitably reflect consideration of the
2406	policyholder's participation in a risk management program
2407	adopted pursuant to s. 627.0625.
2408	5.  A rate shall be deemed inadequate as to the premium
2409	charged to a risk or group of risks if discounts or credits are
2410	allowed which exceed a reasonable reflection of expense savings
2411	and reasonably expected loss experience from the risk or group
2412	of risks.
2413	6.  A rate shall be deemed unfairly discriminatory as to a
2414	risk or group of risks if the application of premium discounts,
2415	credits, or surcharges among such risks does not bear a
2416	reasonable relationship to the expected loss and expense
2417	experience among the various risks.
2418	(f)  In reviewing a rate filing, the office may require the
2419	insurer to provide at the insurer's expense all information
2420	necessary to evaluate the condition of the company and the
2421	reasonableness of the filing according to the criteria
2422	enumerated in this section.
2423	(g)  The office may at any time review a rate, rating
2424	schedule, rating manual, or rate change; the pertinent records
2425	of the insurer; and market conditions.  If the office finds on a
2426	preliminary basis that a rate may be excessive, inadequate, or
2427	unfairly discriminatory, the office shall initiate proceedings
2428	to disapprove the rate and shall so notify the insurer. However,
2429	the office may not disapprove as excessive any rate for which it
2430	has given final approval or which has been deemed approved for a
2431	period of 1 year after the effective date of the filing unless
2432	the office finds that a material misrepresentation or material
2433	error was made by the insurer or was contained in the filing.
2434	Upon being so notified, the insurer or rating organization
2435	shall, within 60 days, file with the office all information
2436	which, in the belief of the insurer or organization, proves the
2437	reasonableness, adequacy, and fairness of the rate or rate
2438	change.  The office shall issue a notice of intent to approve or
2439	a notice of intent to disapprove pursuant to the procedures of
2440	paragraph (a) within 90 days after receipt of the insurer's
2441	initial response.  In such instances and in any administrative
2442	proceeding relating to the legality of the rate, the insurer or
2443	rating organization shall carry the burden of proof by a
2444	preponderance of the evidence to show that the rate is not
2445	excessive, inadequate, or unfairly discriminatory.  After the
2446	office notifies an insurer that a rate may be excessive,
2447	inadequate, or unfairly discriminatory, unless the office
2448	withdraws the notification, the insurer shall not alter the rate
2449	except to conform with the office's notice until the earlier of
2450	120 days after the date the notification was provided or 180
2451	days after the date of the implementation of the rate.  The
2452	office may, subject to chapter 120, disapprove without the 60-
2453	day notification any rate increase filed by an insurer within
2454	the prohibited time period or during the time that the legality
2455	of the increased rate is being contested.
2456	(h)  In the event the office finds that a rate or rate
2457	change is excessive, inadequate, or unfairly discriminatory, the
2458	office shall issue an order of disapproval specifying that a new
2459	rate or rate schedule which responds to the findings of the
2460	office be filed by the insurer.  The office shall further order,
2461	for any "use and file" filing made in accordance with
2462	subparagraph (a)2., that premiums charged each policyholder
2463	constituting the portion of the rate above that which was
2464	actuarially justified be returned to such policyholder in the
2465	form of a credit or refund. If the office finds that an
2466	insurer's rate or rate change is inadequate, the new rate or
2467	rate schedule filed with the office in response to such a
2468	finding shall be applicable only to new or renewal business of
2469	the insurer written on or after the effective date of the
2470	responsive filing.
2471	(i)  Except as otherwise specifically provided in this
2472	chapter, the office shall not prohibit any insurer, including
2473	any residual market plan or joint underwriting association, from
2474	paying acquisition costs based on the full amount of premium, as
2475	defined in s. 627.403, applicable to any policy, or prohibit any
2476	such insurer from including the full amount of acquisition costs
2477	in a rate filing.
2478	(j)  With respect to residential property insurance rate
2479	filings, the rate filing must account for mitigation measures
2480	undertaken by policyholders to reduce hurricane losses.
2481	(j)  Effective July 1, 2007, notwithstanding any other
2482	provision of this section:
2483	1.  With respect to any residential property insurance
2484	subject to regulation under this section for any area for which
2485	the office determines a reasonable degree of competition exists,
2486	a rate filing, including, but not limited to, any rate changes,
2487	rating factors, territories, classification, discounts, and
2488	credits, with respect to any policy form, including endorsements
2489	issued with the form, that results in an overall average
2490	statewide premium increase or decrease of no more than 5 percent
2491	above or below the premium that would result from the insurer's
2492	rates then in effect shall not be subject to a determination by
2493	the office that the rate is excessive or unfairly discriminatory
2494	except as provided in subparagraph 3., or any other provision of
2495	law, provided all changes specified in the filing do not result
2496	in an overall premium increase of more than 10 percent for any
2497	one territory, for reasons related solely to the rate change. As
2498	used in this subparagraph, the term "insurer's rates then in
2499	effect" includes only rates that have been lawfully in effect
2500	under this section or rates that have been determined to be
2501	lawful through administrative proceedings or judicial
2502	proceedings.
2503	2.  An insurer may not make filings under this paragraph
2504	with respect to any policy form, including endorsements issued
2505	with the form, if the overall premium changes resulting from
2506	such filings exceed the amounts specified in this paragraph in
2507	any 12-month period. An insurer may proceed under other
2508	provisions of this section or other provisions of law if the
2509	insurer seeks to exceed the premium or rate limitations of this
2510	paragraph.
2511	3.  This paragraph does not affect the authority of the
2512	office to disapprove a rate as inadequate or to disapprove a
2513	filing for the unlawful use of unfairly discriminatory rating
2514	factors that are prohibited by the laws of this state. An
2515	insurer electing to implement a rate change under this paragraph
2516	shall submit a filing to the office at least 40 days prior to
2517	the effective date of the rate change. The office shall have 30
2518	days after the filing's submission to review the filing and
2519	determine if the rate is inadequate or uses unfairly
2520	discriminatory rating factors. Absent a finding by the office
2521	within such 30-day period that the rate is inadequate or that
2522	the insurer has used unfairly discriminatory rating factors, the
2523	filing is deemed approved. If the office finds during the 30-day
2524	period that the filing will result in inadequate premiums or
2525	otherwise endanger the insurer's solvency, the office shall
2526	suspend the rate decrease. If the insurer is implementing an
2527	overall rate increase, the results of which continue to produce
2528	an inadequate rate, such increase shall proceed pending
2529	additional action by the office to ensure the adequacy of the
2530	rate.
2531	4.  This paragraph does not apply to rate filings for any
2532	insurance other than residential property insurance.
2533
2534	The provisions of this subsection shall not apply to workers'
2535	compensation and employer's liability insurance and to motor
2536	vehicle insurance.
2537
2538	The provisions of this subsection shall not apply to workers'
2539	compensation and employer's liability insurance and to motor
2540	vehicle insurance.
2541	(6)(a)  After any action with respect to a rate filing that
2542	constitutes agency action for purposes of the Administrative
2543	Procedure Act, except for a rate filing for medical malpractice,
2544	an insurer may, in lieu of demanding a hearing under s. 120.57,
2545	require arbitration of the rate filing. However, the arbitration
2546	option provision in this subsection does not apply to a rate
2547	filing that is made on or after the effective date of this act
2548	until January 1, 2009. Arbitration shall be conducted by a board
2549	of arbitrators consisting of an arbitrator selected by the
2550	office, an arbitrator selected by the insurer, and an arbitrator
2551	selected jointly by the other two arbitrators. Each arbitrator
2552	must be certified by the American Arbitration Association. A
2553	decision is valid only upon the affirmative vote of at least two
2554	of the arbitrators. No arbitrator may be an employee of any
2555	insurance regulator or regulatory body or of any insurer,
2556	regardless of whether or not the employing insurer does business
2557	in this state. The office and the insurer must treat the
2558	decision of the arbitrators as the final approval of a rate
2559	filing. Costs of arbitration shall be paid by the insurer.
2560	(9)(a)  Effective March 1, 2007, the chief executive
2561	officer or chief financial officer of a property insurer and the
2562	chief actuary of a property insurer must certify under oath and
2563	subject to the penalty of perjury, on a form approved by the
2564	commission, the following information, which must accompany a
2565	rate filing:
2566	1.  The signing officer and actuary have reviewed the rate
2567	filing;
2568	2.  Based on the signing officer's and actuary's knowledge,
2569	the rate filing does not contain any untrue statement of a
2570	material fact or omit to state a material fact necessary in
2571	order to make the statements made, in light of the circumstances
2572	under which such statements were made, not misleading;
2573	3.  Based on the signing officer's and actuary's knowledge,
2574	the information and other factors described in s. 627.062(2)(b),
2575	including, but not limited to, investment income, fairly present
2576	in all material respects the basis of the rate filing for the
2577	periods presented in the filing; and
2578	4.  Based on the signing officer's and actuary's knowledge,
2579	the rate filing reflects all premium savings that are reasonably
2580	expected to result from legislative enactments and are in
2581	accordance with generally accepted and reasonable actuarial
2582	techniques.
2583	(b)  A signing officer or actuary knowingly making a false
2584	certification under this subsection commits a violation of s.
2585	626.9541(1)(e) and is subject to the penalties under s.
2586	626.9521.
2587	(c)  Failure to provide such certification by the officer
2588	and actuary shall result in the rate filing being disapproved
2589	without prejudice to be refiled.
2590	(d)  The commission may adopt rules and forms pursuant to
2591	ss. 120.536(1) and 120.54 to administer this subsection.
2592	Section 19.  Subsection (1) of section 627.0629, Florida
2593	Statutes, is amended to read:
2594	627.0629  Residential property insurance; rate filings.--
2595	(1)  It is the intent of the Legislature that insurers must
2596	provide savings to consumers who install or implement windstorm
2597	damage mitigation techniques, alterations, or solutions to their
2598	properties to prevent windstorm losses. Effective June 1, 2002,
2599	A rate filing for residential property insurance must include
2600	actuarially reasonable discounts, credits, or other rate
2601	differentials, or appropriate reductions in deductibles, for
2602	properties on which fixtures or construction techniques
2603	demonstrated to reduce the amount of loss in a windstorm have
2604	been installed or implemented. The fixtures or construction
2605	techniques shall include, but not be limited to, fixtures or
2606	construction techniques which enhance roof strength, roof
2607	covering performance, roof-to-wall strength, wall-to-floor-to-
2608	foundation strength, opening protection, and window, door, and
2609	skylight strength. Credits, discounts, or other rate
2610	differentials, or appropriate reductions in deductibles, for
2611	fixtures and construction techniques which meet the minimum
2612	requirements of the Florida Building Code must be included in
2613	the rate filing. All insurance companies must make a rate filing
2614	which includes the credits, discounts, or other rate
2615	differentials or reductions in deductibles by February 28, 2003.
2616	By July 1, 2007, the office shall reevaluate the discounts,
2617	credits, other rate differentials, and appropriate reductions in
2618	deductibles for fixtures and construction techniques that meet
2619	the minimum requirements of the Florida Building Code, based
2620	upon actual experience or any other loss relativity studies
2621	available to the office. The office shall determine the
2622	discounts, credits, other rate differentials, and appropriate
2623	reductions in deductibles that reflect the full actuarial value
2624	of such revaluation, which may be used by insurers in rate
2625	filings.
2626	Section 20.  Section 627.0655, Florida Statutes, is created
2627	to read:
2628	627.0655  Policyholder loss or expense-related premium
2629	discounts.--An insurer or person authorized to engage in the
2630	business of insurance in this state may include, in the premium
2631	charged an insured for any policy, contract, or certificate of
2632	insurance, a discount based on the fact that another policy,
2633	contract, or certificate of any type has been purchased by the
2634	insured.
2635	Section 21.  Paragraphs (a), (b), (c), (m), (p), and (s) of
2636	subsection (6) of section 627.351, Florida Statutes, are
2637	amended, and paragraph (ee) is added to that subsection, to
2638	read:
2639	627.351  Insurance risk apportionment plans.--
2640	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
2641	(a)1.  The Legislature finds that actual and threatened
2642	catastrophic losses to property in this state from hurricanes
2643	have caused insurers to be unwilling or unable to provide
2644	property insurance coverage to the extent sought and needed. It
2645	is in the public interest and a public purpose to assist in
2646	assuring that property in the state is insured so as to
2647	facilitate the remediation, reconstruction, and replacement of
2648	damaged or destroyed property in order to reduce or avoid the
2649	negative effects otherwise resulting to the public health,
2650	safety, and welfare; to the economy of the state; and to the
2651	revenues of the state and local governments needed to provide
2652	for the public welfare. It is necessary, therefore, to provide
2653	property insurance to applicants who are in good faith entitled
2654	to procure insurance through the voluntary market but are unable
2655	to do so. The Legislature intends by this subsection that
2656	property insurance be provided and that it continues, as long as
2657	necessary, through an entity organized to achieve efficiencies
2658	and economies, while providing service to policyholders,
2659	applicants, and agents that is no less than the quality
2660	generally provided in the voluntary market, all toward the
2661	achievement of the foregoing public purposes. Because it is
2662	essential for the corporation to have the maximum financial
2663	resources to pay claims following a catastrophic hurricane, it
2664	is the intent of the Legislature that the income of the
2665	corporation be exempt from federal income taxation and that
2666	interest on the debt obligations issued by the corporation be
2667	exempt from federal income taxation.
2668	2.  The Residential Property and Casualty Joint
2669	Underwriting Association originally created by this statute
2670	shall be known, as of July 1, 2002, as the Citizens Property
2671	Insurance Corporation. The corporation shall provide insurance
2672	for residential and commercial property, for applicants who are
2673	in good faith entitled, but are unable, to procure insurance
2674	through the voluntary market. The corporation shall operate
2675	pursuant to a plan of operation approved by order of the
2676	Financial Services Commission. The plan is subject to continuous
2677	review by the commission. The commission may, by order, withdraw
2678	approval of all or part of a plan if the commission determines
2679	that conditions have changed since approval was granted and that
2680	the purposes of the plan require changes in the plan. The
2681	corporation shall continue to operate pursuant to the plan of
2682	operation approved by the Office of Insurance Regulation until
2683	October 1, 2006. For the purposes of this subsection,
2684	residential coverage includes both personal lines residential
2685	coverage, which consists of the type of coverage provided by
2686	homeowner's, mobile home owner's, dwelling, tenant's,
2687	condominium unit owner's, and similar policies, and commercial
2688	lines residential coverage, which consists of the type of
2689	coverage provided by condominium association, apartment
2690	building, and similar policies.
2691	3.  For the purposes of this subsection, the term
2692	"homestead property" means:
2693	a.  Property that has been granted a homestead exemption
2694	under chapter 196;
2695	b.  Property for which the owner has a current, written
2696	lease with a renter for a term of at least 7 months and for
2697	which the dwelling is insured by the corporation for $200,000 or
2698	less;
2699	c.  An owner-occupied mobile home or manufactured home, as
2700	defined in s. 320.01, which is permanently affixed to real
2701	property, is owned by a Florida resident, and has been granted a
2702	homestead exemption under chapter 196 or, if the owner does not
2703	own the real property, the owner certifies that the mobile home
2704	or manufactured home is his or her principal place of
2705	residence;.
2706	d.  Tenant's coverage;
2707	e.  Commercial lines residential property; or
2708	f.  Any county, district, or municipal hospital; a hospital
2709	licensed by any not-for-profit corporation qualified under s.
2710	501(c)(3) of the United States Internal Revenue Code; or a
2711	continuing care retirement community that is certified under
2712	chapter 651 and that receives an exemption from ad valorem taxes
2713	under chapter 196.
2714	4.  For the purposes of this subsection, the term
2715	"nonhomestead property" means property that is not homestead
2716	property.
2717	5.  Effective July 1, 2008, a personal lines residential
2718	structure that has a dwelling replacement cost of $1 million or
2719	more, or a single condominium unit that has a combined dwelling
2720	and content replacement cost of $1 million or more is not
2721	eligible for coverage by the corporation. Such dwellings insured
2722	by the corporation on June 30, 2008, may continue to be covered
2723	by the corporation until the end of the policy term. However,
2724	such dwellings that are insured by the corporation and become
2725	ineligible for coverage due to the provisions of this
2726	subparagraph may reapply and obtain coverage in the high-risk
2727	account and be considered "nonhomestead property" if the
2728	property owner provides the corporation with a sworn affidavit
2729	from one or more insurance agents, on a form provided by the
2730	corporation, stating that the agents have made their best
2731	efforts to obtain coverage and that the property has been
2732	rejected for coverage by at least one authorized insurer and at
2733	least three surplus lines insurers. If such conditions are met,
2734	the dwelling may be insured by the corporation for up to 3
2735	years, after which time the dwelling is ineligible for coverage.
2736	The office shall approve the method used by the corporation for
2737	valuing the dwelling replacement cost for the purposes of this
2738	subparagraph. If a policyholder is insured by the corporation
2739	prior to being determined to be ineligible pursuant to this
2740	subparagraph and such policyholder files a lawsuit challenging
2741	the determination, the policyholder may remain insured by the
2742	corporation until the conclusion of the litigation.
2743	6.  For properties constructed on or after January 1,2009,
2744	the corporation may not insure any property located within 2,500
2745	feet landward of the coastal construction control line created
2746	pursuant to s. 161.053 unless the property meets the
2747	requirements of the code-plus building standards developed by
2748	the Florida Building Commission.
2749	6.  Effective March 1, 2007, nonhomestead property is not
2750	eligible for coverage by the corporation and is not eligible for
2751	renewal of such coverage unless the property owner provides the
2752	corporation with a sworn affidavit from one or more insurance
2753	agents, on a form provided by the corporation, stating that the
2754	agents have made their best efforts to obtain coverage and that
2755	the property has been rejected for coverage by at least one
2756	authorized insurer and at least three surplus lines insurers.
2757	7.  It is the intent of the Legislature that policyholders,
2758	applicants, and agents of the corporation receive service and
2759	treatment of the highest possible level but never less than that
2760	generally provided in the voluntary market. It also is intended
2761	that the corporation be held to service standards no less than
2762	those applied to insurers in the voluntary market by the office
2763	with respect to responsiveness, timeliness, customer courtesy,
2764	and overall dealings with policyholders, applicants, or agents
2765	of the corporation.
2766	(b)1.  All insurers authorized to write one or more subject
2767	lines of business in this state are subject to assessment by the
2768	corporation and, for the purposes of this subsection, are
2769	referred to collectively as "assessable insurers." Insurers
2770	writing one or more subject lines of business in this state
2771	pursuant to part VIII of chapter 626 are not assessable
2772	insurers, but insureds who procure one or more subject lines of
2773	business in this state pursuant to part VIII of chapter 626 are
2774	subject to assessment by the corporation and are referred to
2775	collectively as "assessable insureds." An authorized insurer's
2776	assessment liability shall begin on the first day of the
2777	calendar year following the year in which the insurer was issued
2778	a certificate of authority to transact insurance for subject
2779	lines of business in this state and shall terminate 1 year after
2780	the end of the first calendar year during which the insurer no
2781	longer holds a certificate of authority to transact insurance
2782	for subject lines of business in this state.
2783	2.a.  All revenues, assets, liabilities, losses, and
2784	expenses of the corporation shall be divided into three separate
2785	accounts as follows:
2786	(I)  A personal lines account for personal residential
2787	policies issued by the corporation or issued by the Residential
2788	Property and Casualty Joint Underwriting Association and renewed
2789	by the corporation that provide comprehensive, multiperil
2790	coverage on risks that are not located in areas eligible for
2791	coverage in the Florida Windstorm Underwriting Association as
2792	those areas were defined on January 1, 2002, and for such
2793	policies that do not provide coverage for the peril of wind on
2794	risks that are located in such areas;
2795	(II)  A commercial lines account for commercial residential
2796	and commercial nonresidential policies issued by the corporation
2797	or issued by the Residential Property and Casualty Joint
2798	Underwriting Association and renewed by the corporation that
2799	provide coverage for basic property perils on risks that are not
2800	located in areas eligible for coverage in the Florida Windstorm
2801	Underwriting Association as those areas were defined on January
2802	1, 2002, and for such policies that do not provide coverage for
2803	the peril of wind on risks that are located in such areas; and
2804	(III)  A high-risk account for personal residential
2805	policies and commercial residential and commercial
2806	nonresidential property policies issued by the corporation or
2807	transferred to the corporation that provide coverage for the
2808	peril of wind on risks that are located in areas eligible for
2809	coverage in the Florida Windstorm Underwriting Association as
2810	those areas were defined on January 1, 2002. Subject to the
2811	approval of a business plan by the Financial Services Commission
2812	and Legislative Budget Commission as provided in this sub-sub-
2813	subparagraph, but no earlier than March 31, 2007, the
2814	corporation may offer policies that provide multiperil coverage
2815	and the corporation shall continue to offer policies that
2816	provide coverage only for the peril of wind for risks located in
2817	areas eligible for coverage in the high-risk account. In issuing
2818	multiperil coverage, the corporation may use its approved policy
2819	forms and rates for the personal lines account. An applicant or
2820	insured who is eligible to purchase a multiperil policy from the
2821	corporation may purchase a multiperil policy from an authorized
2822	insurer without prejudice to the applicant's or insured's
2823	eligibility to prospectively purchase a policy that provides
2824	coverage only for the peril of wind from the corporation. An
2825	applicant or insured who is eligible for a corporation policy
2826	that provides coverage only for the peril of wind may elect to
2827	purchase or retain such policy and also purchase or retain
2828	coverage excluding wind from an authorized insurer without
2829	prejudice to the applicant's or insured's eligibility to
2830	prospectively purchase a policy that provides multiperil
2831	coverage from the corporation. It is the goal of the Legislature
2832	that there would be an overall average savings of 10 percent or
2833	more for a policyholder who currently has a wind-only policy
2834	with the corporation, and an ex-wind policy with a voluntary
2835	insurer or the corporation, and who then obtains a multiperil
2836	policy from the corporation. It is the intent of the Legislature
2837	that the offer of multiperil coverage in the high-risk account
2838	be made and implemented in a manner that does not adversely
2839	affect the tax-exempt status of the corporation or
2840	creditworthiness of or security for currently outstanding
2841	financing obligations or credit facilities of the high-risk
2842	account, the personal lines account, or the commercial lines
2843	account. By March 1, 2007, the corporation shall prepare and
2844	submit for approval by the Financial Services Commission and
2845	Legislative Budget Commission a report detailing the
2846	corporation's business plan for issuing multiperil coverage in
2847	the high-risk account. The business plan shall be approved or
2848	disapproved within 30 days after receipt, as submitted or
2849	modified and resubmitted by the corporation. The business plan
2850	must include: the impact of such multiperil coverage on the
2851	corporation's financial resources, the impact of such multiperil
2852	coverage on the corporation's tax-exempt status, the manner in
2853	which the corporation plans to implement the processing of
2854	applications and policy forms for new and existing
2855	policyholders, the impact of such multiperil coverage on the
2856	corporation's ability to deliver customer service at the high
2857	level required by this subsection, the ability of the
2858	corporation to process claims, the ability of the corporation to
2859	quote and issue policies, the impact of such multiperil coverage
2860	on the corporation's agents, the impact of such multiperil
2861	coverage on the corporation's existing policyholders, and the
2862	impact of such multiperil coverage on rates and premium. The
2863	high-risk account must also include quota share primary
2864	insurance under subparagraph (c)2. The area eligible for
2865	coverage under the high-risk account also includes the area
2866	within Port Canaveral, which is bordered on the south by the
2867	City of Cape Canaveral, bordered on the west by the Banana
2868	River, and bordered on the north by Federal Government property.
2869	The office may remove territory from the area eligible for wind-
2870	only and quota share coverage if, after a public hearing, the
2871	office finds that authorized insurers in the voluntary market
2872	are willing and able to write sufficient amounts of personal and
2873	commercial residential coverage for all perils in the territory,
2874	including coverage for the peril of wind, such that risks
2875	covered by wind-only policies in the removed territory could be
2876	issued a policy by the corporation in either the personal lines
2877	or commercial lines account without a significant increase in
2878	the corporation's probable maximum loss in such account. Removal
2879	of territory from the area eligible for wind-only or quota share
2880	coverage does not alter the assignment of wind coverage written
2881	in such areas to the high-risk account.
2882	b.  The three separate accounts must be maintained as long
2883	as financing obligations entered into by the Florida Windstorm
2884	Underwriting Association or Residential Property and Casualty
2885	Joint Underwriting Association are outstanding, in accordance
2886	with the terms of the corresponding financing documents. When
2887	the financing obligations are no longer outstanding, in
2888	accordance with the terms of the corresponding financing
2889	documents, the corporation may use a single account for all
2890	revenues, assets, liabilities, losses, and expenses of the
2891	corporation. Consistent with the requirement of this
2892	subparagraph and prudent investment policies that minimize the
2893	cost of carrying debt, the board shall exercise its best efforts
2894	to retire existing debt or to obtain approval of necessary
2895	parties to amend the terms of existing debt, so as to structure
2896	the most efficient plan to consolidate the three separate
2897	accounts into a single account. By February 1, 2007, the board
2898	shall submit a report to the Financial Services Commission, the
2899	President of the Senate, and the Speaker of the House of
2900	Representatives which includes an analysis of consolidating the
2901	accounts, the actions the board has taken to minimize the cost
2902	of carrying debt, and its recommendations for executing the most
2903	efficient plan.
2904	c.  Creditors of the Residential Property and Casualty
2905	Joint Underwriting Association shall have a claim against, and
2906	recourse to, the accounts referred to in sub-sub-subparagraphs
2907	a.(I) and (II) and shall have no claim against, or recourse to,
2908	the account referred to in sub-sub-subparagraph a.(III).
2909	Creditors of the Florida Windstorm Underwriting Association
2910	shall have a claim against, and recourse to, the account
2911	referred to in sub-sub-subparagraph a.(III) and shall have no
2912	claim against, or recourse to, the accounts referred to in sub-
2913	sub-subparagraphs a.(I) and (II).
2914	d.  Revenues, assets, liabilities, losses, and expenses not
2915	attributable to particular accounts shall be prorated among the
2916	accounts.
2917	e.  The Legislature finds that the revenues of the
2918	corporation are revenues that are necessary to meet the
2919	requirements set forth in documents authorizing the issuance of
2920	bonds under this subsection.
2921	f.  No part of the income of the corporation may inure to
2922	the benefit of any private person.
2923	3.  With respect to a deficit in an account:
2924	a.  When the deficit incurred in a particular calendar year
2925	is not greater than 10 percent of the aggregate statewide direct
2926	written premium for the subject lines of business for the prior
2927	calendar year, the entire deficit shall be recovered through
2928	regular assessments of assessable insurers under paragraph (p)
2929	and assessable insureds.
2930	b.  When the deficit incurred in a particular calendar year
2931	exceeds 10 percent of the aggregate statewide direct written
2932	premium for the subject lines of business for the prior calendar
2933	year, the corporation shall levy regular assessments on
2934	assessable insurers under paragraph (p) and on assessable
2935	insureds in an amount equal to the greater of 10 percent of the
2936	deficit or 10 percent of the aggregate statewide direct written
2937	premium for the subject lines of business for the prior calendar
2938	year. Any remaining deficit shall be recovered through emergency
2939	assessments under sub-subparagraph d.
2940	c.  Each assessable insurer's share of the amount being
2941	assessed under sub-subparagraph a. or sub-subparagraph b. shall
2942	be in the proportion that the assessable insurer's direct
2943	written premium for the subject lines of business for the year
2944	preceding the assessment bears to the aggregate statewide direct
2945	written premium for the subject lines of business for that year.
2946	The assessment percentage applicable to each assessable insured
2947	is the ratio of the amount being assessed under sub-subparagraph
2948	a. or sub-subparagraph b. to the aggregate statewide direct
2949	written premium for the subject lines of business for the prior
2950	year. Assessments levied by the corporation on assessable
2951	insurers under sub-subparagraphs a. and b. shall be paid as
2952	required by the corporation's plan of operation and paragraph
2953	(p). Notwithstanding any other provision of this subsection, the
2954	aggregate amount of a regular assessment for a deficit incurred
2955	in a particular calendar year shall be reduced by the estimated
2956	amount to be received by the corporation from the Citizens
2957	policyholder surcharge under subparagraph (c)11. and the amount
2958	collected or estimated to be collected from the assessment on
2959	Citizens policyholders pursuant to sub-subparagraph i.
2960	Assessments levied by the corporation on assessable insureds
2961	under sub-subparagraphs a. and b. shall be collected by the
2962	surplus lines agent at the time the surplus lines agent collects
2963	the surplus lines tax required by s. 626.932 and shall be paid
2964	to the Florida Surplus Lines Service Office at the time the
2965	surplus lines agent pays the surplus lines tax to the Florida
2966	Surplus Lines Service Office. Upon receipt of regular
2967	assessments from surplus lines agents, the Florida Surplus Lines
2968	Service Office shall transfer the assessments directly to the
2969	corporation as determined by the corporation.
2970	d.  Upon a determination by the board of governors that a
2971	deficit in an account exceeds the amount that will be recovered
2972	through regular assessments under sub-subparagraph a. or sub-
2973	subparagraph b., the board shall levy, after verification by the
2974	office, emergency assessments, for as many years as necessary to
2975	cover the deficits, to be collected by assessable insurers and
2976	the corporation and collected from assessable insureds upon
2977	issuance or renewal of policies for subject lines of business,
2978	excluding National Flood Insurance policies. The amount of the
2979	emergency assessment collected in a particular year shall be a
2980	uniform percentage of that year's direct written premium for
2981	subject lines of business and all accounts of the corporation,
2982	excluding National Flood Insurance Program policy premiums, as
2983	annually determined by the board and verified by the office. The
2984	office shall verify the arithmetic calculations involved in the
2985	board's determination within 30 days after receipt of the
2986	information on which the determination was based.
2987	Notwithstanding any other provision of law, the corporation and
2988	each assessable insurer that writes subject lines of business
2989	shall collect emergency assessments from its policyholders
2990	without such obligation being affected by any credit,
2991	limitation, exemption, or deferment. Emergency assessments
2992	levied by the corporation on assessable insureds shall be
2993	collected by the surplus lines agent at the time the surplus
2994	lines agent collects the surplus lines tax required by s.
2995	626.932 and shall be paid to the Florida Surplus Lines Service
2996	Office at the time the surplus lines agent pays the surplus
2997	lines tax to the Florida Surplus Lines Service Office. The
2998	emergency assessments so collected shall be transferred directly
2999	to the corporation on a periodic basis as determined by the
3000	corporation and shall be held by the corporation solely in the
3001	applicable account. The aggregate amount of emergency
3002	assessments levied for an account under this sub-subparagraph in
3003	any calendar year may not exceed the greater of 10 percent of
3004	the amount needed to cover the original deficit, plus interest,
3005	fees, commissions, required reserves, and other costs associated
3006	with financing of the original deficit, or 10 percent of the
3007	aggregate statewide direct written premium for subject lines of
3008	business and for all accounts of the corporation for the prior
3009	year, plus interest, fees, commissions, required reserves, and
3010	other costs associated with financing the original deficit.
3011	e.  The corporation may pledge the proceeds of assessments,
3012	projected recoveries from the Florida Hurricane Catastrophe
3013	Fund, other insurance and reinsurance recoverables, policyholder
3014	surcharges and other surcharges, and other funds available to
3015	the corporation as the source of revenue for and to secure bonds
3016	issued under paragraph (p), bonds or other indebtedness issued
3017	under subparagraph (c)3., or lines of credit or other financing
3018	mechanisms issued or created under this subsection, or to retire
3019	any other debt incurred as a result of deficits or events giving
3020	rise to deficits, or in any other way that the board determines
3021	will efficiently recover such deficits. The purpose of the lines
3022	of credit or other financing mechanisms is to provide additional
3023	resources to assist the corporation in covering claims and
3024	expenses attributable to a catastrophe. As used in this
3025	subsection, the term "assessments" includes regular assessments
3026	under sub-subparagraph a., sub-subparagraph b., or subparagraph
3027	(p)1. and emergency assessments under sub-subparagraph d.
3028	Emergency assessments collected under sub-subparagraph d. are
3029	not part of an insurer's rates, are not premium, and are not
3030	subject to premium tax, fees, or commissions; however, failure
3031	to pay the emergency assessment shall be treated as failure to
3032	pay premium. The emergency assessments under sub-subparagraph d.
3033	shall continue as long as any bonds issued or other indebtedness
3034	incurred with respect to a deficit for which the assessment was
3035	imposed remain outstanding, unless adequate provision has been
3036	made for the payment of such bonds or other indebtedness
3037	pursuant to the documents governing such bonds or other
3038	indebtedness.
3039	f.  As used in this subsection, the term "subject lines of
3040	business" means insurance written by assessable insurers or
3041	procured by assessable insureds for all property and casualty
3042	lines of business in this state, but not including workers'
3043	compensation or medical malpractice. As used in the sub-
3044	subparagraph, the term "property and casualty lines of business"
3045	includes all lines of business identified on Form 2, Exhibit of
3046	Premiums and Losses, in the annual statement required of
3047	authorized insurers by s. 624.424 and any rule adopted under
3048	this section, except for those lines identified as accident and
3049	health insurance and except for policies written under the
3050	National Flood Insurance program or the Federal Crop Insurance
3051	Program. For purposes of this sub-subparagraph, the term
3052	"workers' compensation" includes both workers' compensation
3053	insurance and excess workers' compensation insurance. on real or
3054	personal property, as defined in s. 624.604, including insurance
3055	for fire, industrial fire, allied lines, farmowners multiperil,
3056	homeowners multiperil, commercial multiperil, and mobile homes,
3057	and including liability coverage on all such insurance, but
3058	excluding inland marine as defined in s. 624.607(3) and
3059	excluding vehicle insurance as defined in s. 624.605(1) other
3060	than insurance on mobile homes used as permanent dwellings.
3061	g.  The Florida Surplus Lines Service Office shall
3062	determine annually the aggregate statewide written premium in
3063	subject lines of business procured by assessable insureds and
3064	shall report that information to the corporation in a form and
3065	at a time the corporation specifies to ensure that the
3066	corporation can meet the requirements of this subsection and the
3067	corporation's financing obligations.
3068	h.  The Florida Surplus Lines Service Office shall verify
3069	the proper application by surplus lines agents of assessment
3070	percentages for regular assessments and emergency assessments
3071	levied under this subparagraph on assessable insureds and shall
3072	assist the corporation in ensuring the accurate, timely
3073	collection and payment of assessments by surplus lines agents as
3074	required by the corporation.
3075	i.  If a deficit is incurred in any account in 2008 or
3076	thereafter, the board of governors shall levy an immediate
3077	assessment against the premium of each nonhomestead property
3078	policyholder in all accounts of the corporation, as a uniform
3079	percentage of the premium of the policy of up to 10 percent of
3080	such premium, which funds shall be used to offset the deficit.
3081	If this assessment is insufficient to eliminate the deficit, the
3082	board of governors shall levy an additional assessment against
3083	all policyholders of the corporation, which shall be collected
3084	at the time of issuance or renewal of a policy, as a uniform
3085	percentage of the premium for the policy of up to 10 percent of
3086	such premium, which funds shall be used to further offset the
3087	deficit.
3088	j.  The board of governors shall maintain separate
3089	accounting records that consolidate data for nonhomestead
3090	properties, including, but not limited to, number of policies,
3091	insured values, premiums written, and losses. The board of
3092	governors shall annually report to the office and the
3093	Legislature a summary of such data.
3094	(c)  The plan of operation of the corporation:
3095	1.  Must provide for adoption of residential property and
3096	casualty insurance policy forms and commercial residential and
3097	nonresidential property insurance forms, which forms must be
3098	approved by the office prior to use. The corporation shall adopt
3099	the following policy forms:
3100	a.  Standard personal lines policy forms that are
3101	comprehensive multiperil policies providing full coverage of a
3102	residential property equivalent to the coverage provided in the
3103	private insurance market under an HO-3, HO-4, or HO-6 policy.
3104	b.  Basic personal lines policy forms that are policies
3105	similar to an HO-8 policy or a dwelling fire policy that provide
3106	coverage meeting the requirements of the secondary mortgage
3107	market, but which coverage is more limited than the coverage
3108	under a standard policy.
3109	c.  Commercial lines residential and nonresidential policy
3110	forms that are generally similar to the basic perils of full
3111	coverage obtainable for commercial residential structures and
3112	commercial nonresidential structures in the admitted voluntary
3113	market.
3114	d.  Personal lines and commercial lines residential
3115	property insurance forms that cover the peril of wind only. The
3116	forms are applicable only to residential properties located in
3117	areas eligible for coverage under the high-risk account referred
3118	to in sub-subparagraph (b)2.a.
3119	e.  Commercial lines nonresidential property insurance
3120	forms that cover the peril of wind only. The forms are
3121	applicable only to nonresidential properties located in areas
3122	eligible for coverage under the high-risk account referred to in
3123	sub-subparagraph (b)2.a.
3124	f.  The corporation may adopt variations of the policy
3125	forms listed in sub-subparagraphs a.-e. that contain more
3126	restrictive coverage.
3127	2.a.  Must provide that the corporation adopt a program in
3128	which the corporation and authorized insurers enter into quota
3129	share primary insurance agreements for hurricane coverage, as
3130	defined in s. 627.4025(2)(a), for eligible risks, and adopt
3131	property insurance forms for eligible risks which cover the
3132	peril of wind only. As used in this subsection, the term:
3133	(I)  "Quota share primary insurance" means an arrangement
3134	in which the primary hurricane coverage of an eligible risk is
3135	provided in specified percentages by the corporation and an
3136	authorized insurer. The corporation and authorized insurer are
3137	each solely responsible for a specified percentage of hurricane
3138	coverage of an eligible risk as set forth in a quota share
3139	primary insurance agreement between the corporation and an
3140	authorized insurer and the insurance contract. The
3141	responsibility of the corporation or authorized insurer to pay
3142	its specified percentage of hurricane losses of an eligible
3143	risk, as set forth in the quota share primary insurance
3144	agreement, may not be altered by the inability of the other
3145	party to the agreement to pay its specified percentage of
3146	hurricane losses. Eligible risks that are provided hurricane
3147	coverage through a quota share primary insurance arrangement
3148	must be provided policy forms that set forth the obligations of
3149	the corporation and authorized insurer under the arrangement,
3150	clearly specify the percentages of quota share primary insurance
3151	provided by the corporation and authorized insurer, and
3152	conspicuously and clearly state that neither the authorized
3153	insurer nor the corporation may be held responsible beyond its
3154	specified percentage of coverage of hurricane losses.
3155	(II)  "Eligible risks" means personal lines residential and
3156	commercial lines residential risks that meet the underwriting
3157	criteria of the corporation and are located in areas that were
3158	eligible for coverage by the Florida Windstorm Underwriting
3159	Association on January 1, 2002.
3160	b.  The corporation may enter into quota share primary
3161	insurance agreements with authorized insurers at corporation
3162	coverage levels of 90 percent and 50 percent.
3163	c.  If the corporation determines that additional coverage
3164	levels are necessary to maximize participation in quota share
3165	primary insurance agreements by authorized insurers, the
3166	corporation may establish additional coverage levels. However,
3167	the corporation's quota share primary insurance coverage level
3168	may not exceed 90 percent.
3169	d.  Any quota share primary insurance agreement entered
3170	into between an authorized insurer and the corporation must
3171	provide for a uniform specified percentage of coverage of
3172	hurricane losses, by county or territory as set forth by the
3173	corporation board, for all eligible risks of the authorized
3174	insurer covered under the quota share primary insurance
3175	agreement.
3176	e.  Any quota share primary insurance agreement entered
3177	into between an authorized insurer and the corporation is
3178	subject to review and approval by the office. However, such
3179	agreement shall be authorized only as to insurance contracts
3180	entered into between an authorized insurer and an insured who is
3181	already insured by the corporation for wind coverage.
3182	f.  For all eligible risks covered under quota share
3183	primary insurance agreements, the exposure and coverage levels
3184	for both the corporation and authorized insurers shall be
3185	reported by the corporation to the Florida Hurricane Catastrophe
3186	Fund. For all policies of eligible risks covered under quota
3187	share primary insurance agreements, the corporation and the
3188	authorized insurer shall maintain complete and accurate records
3189	for the purpose of exposure and loss reimbursement audits as
3190	required by Florida Hurricane Catastrophe Fund rules. The
3191	corporation and the authorized insurer shall each maintain
3192	duplicate copies of policy declaration pages and supporting
3193	claims documents.
3194	g.  The corporation board shall establish in its plan of
3195	operation standards for quota share agreements which ensure that
3196	there is no discriminatory application among insurers as to the
3197	terms of quota share agreements, pricing of quota share
3198	agreements, incentive provisions if any, and consideration paid
3199	for servicing policies or adjusting claims.
3200	h.  The quota share primary insurance agreement between the
3201	corporation and an authorized insurer must set forth the
3202	specific terms under which coverage is provided, including, but
3203	not limited to, the sale and servicing of policies issued under
3204	the agreement by the insurance agent of the authorized insurer
3205	producing the business, the reporting of information concerning
3206	eligible risks, the payment of premium to the corporation, and
3207	arrangements for the adjustment and payment of hurricane claims
3208	incurred on eligible risks by the claims adjuster and personnel
3209	of the authorized insurer. Entering into a quota sharing
3210	insurance agreement between the corporation and an authorized
3211	insurer shall be voluntary and at the discretion of the
3212	authorized insurer.
3213	3.  May provide that the corporation may employ or
3214	otherwise contract with individuals or other entities to provide
3215	administrative or professional services that may be appropriate
3216	to effectuate the plan. The corporation shall have the power to
3217	borrow funds, by issuing bonds or by incurring other
3218	indebtedness, and shall have other powers reasonably necessary
3219	to effectuate the requirements of this subsection, including,
3220	without limitation, the power to issue bonds and incur other
3221	indebtedness in order to refinance outstanding bonds or other
3222	indebtedness. The corporation may, but is not required to, seek
3223	judicial validation of its bonds or other indebtedness under
3224	chapter 75. The corporation may issue bonds or incur other
3225	indebtedness, or have bonds issued on its behalf by a unit of
3226	local government pursuant to subparagraph (g)2., in the absence
3227	of a hurricane or other weather-related event, upon a
3228	determination by the corporation, subject to approval by the
3229	office, that such action would enable it to efficiently meet the
3230	financial obligations of the corporation and that such
3231	financings are reasonably necessary to effectuate the
3232	requirements of this subsection. The corporation is authorized
3233	to take all actions needed to facilitate tax-free status for any
3234	such bonds or indebtedness, including formation of trusts or
3235	other affiliated entities. The corporation shall have the
3236	authority to pledge assessments, projected recoveries from the
3237	Florida Hurricane Catastrophe Fund, other reinsurance
3238	recoverables, market equalization and other surcharges, and
3239	other funds available to the corporation as security for bonds
3240	or other indebtedness. In recognition of s. 10, Art. I of the
3241	State Constitution, prohibiting the impairment of obligations of
3242	contracts, it is the intent of the Legislature that no action be
3243	taken whose purpose is to impair any bond indenture or financing
3244	agreement or any revenue source committed by contract to such
3245	bond or other indebtedness.
3246	4.a.  Must require that the corporation operate subject to
3247	the supervision and approval of a board of governors consisting
3248	of eight individuals who are residents of this state, from
3249	different geographical areas of this state. The Governor, the
3250	Chief Financial Officer, the President of the Senate, and the
3251	Speaker of the House of Representatives shall each appoint two
3252	members of the board. At least one of the two members appointed
3253	by each appointing officer must have demonstrated expertise in
3254	insurance. The Chief Financial Officer shall designate one of
3255	the appointees as chair. All board members serve at the pleasure
3256	of the appointing officer. All members of the board of governors
3257	are subject to removal at will by the officers who appointed
3258	them. All board members, including the chair, must be appointed
3259	to serve for 3-year terms beginning annually on a date
3260	designated by the plan. Any board vacancy shall be filled for
3261	the unexpired term by the appointing officer. The Chief
3262	Financial Officer shall appoint a technical advisory group to
3263	provide information and advice to the board of governors in
3264	connection with the board's duties under this subsection. The
3265	executive director and senior managers of the corporation shall
3266	be engaged by the board and serve at the pleasure of the board.
3267	Any executive director appointed on or after July 1, 2006, is
3268	subject to confirmation by the Senate. The executive director is
3269	responsible for employing other staff as the corporation may
3270	require, subject to review and concurrence by the board.
3271	b.  The board shall create a Market Accountability Advisory
3272	Committee to assist the corporation in developing awareness of
3273	its rates and its customer and agent service levels in
3274	relationship to the voluntary market insurers writing similar
3275	coverage. The members of the advisory committee shall consist of
3276	the following 11 persons, one of whom must be elected chair by
3277	the members of the committee: four representatives, one
3278	appointed by the Florida Association of Insurance Agents, one by
3279	the Florida Association of Insurance and Financial Advisors, one
3280	by the Professional Insurance Agents of Florida, and one by the
3281	Latin American Association of Insurance Agencies; three
3282	representatives appointed by the insurers with the three highest
3283	voluntary market share of residential property insurance
3284	business in the state; one representative from the Office of
3285	Insurance Regulation; one consumer appointed by the board who is
3286	insured by the corporation at the time of appointment to the
3287	committee; one representative appointed by the Florida
3288	Association of Realtors; and one representative appointed by the
3289	Florida Bankers Association. All members must serve for 3-year
3290	terms and may serve for consecutive terms. The committee shall
3291	report to the corporation at each board meeting on insurance
3292	market issues which may include rates and rate competition with
3293	the voluntary market; service, including policy issuance, claims
3294	processing, and general responsiveness to policyholders,
3295	applicants, and agents; and matters relating to depopulation.
3296	5.  Must provide a procedure for determining the
3297	eligibility of a risk for coverage, as follows:
3298	a.  Subject to the provisions of s. 627.3517, with respect
3299	to personal lines residential risks, if the risk is offered
3300	coverage from an authorized insurer at the insurer's approved
3301	rate under either a standard policy including wind coverage or,
3302	if consistent with the insurer's underwriting rules as filed
3303	with the office, a basic policy including wind coverage, for a
3304	new application to the corporation for coverage, the risk is not
3305	eligible for any policy issued by the corporation unless the
3306	premium for coverage from the authorized insurer is more than 25
3307	percent greater than the premium for comparable coverage from
3308	the corporation. If the risk is not able to obtain any such
3309	offer, the risk is eligible for either a standard policy
3310	including wind coverage or a basic policy including wind
3311	coverage issued by the corporation; however, if the risk could
3312	not be insured under a standard policy including wind coverage
3313	regardless of market conditions, the risk shall be eligible for
3314	a basic policy including wind coverage unless rejected under
3315	subparagraph 8. However, with regard to a policyholder of the
3316	corporation, the policyholder remains eligible for coverage from
3317	the corporation regardless of any offer of coverage from an
3318	authorized insurer or surplus lines insurer. The corporation
3319	shall determine the type of policy to be provided on the basis
3320	of objective standards specified in the underwriting manual and
3321	based on generally accepted underwriting practices.
3322	(I)  If the risk accepts an offer of coverage through the
3323	market assistance plan or an offer of coverage through a
3324	mechanism established by the corporation before a policy is
3325	issued to the risk by the corporation or during the first 30
3326	days of coverage by the corporation, and the producing agent who
3327	submitted the application to the plan or to the corporation is
3328	not currently appointed by the insurer, the insurer shall:
3329	(A)  Pay to the producing agent of record of the policy,
3330	for the first year, an amount that is the greater of the
3331	insurer's usual and customary commission for the type of policy
3332	written or a fee equal to the usual and customary commission of
3333	the corporation; or
3334	(B)  Offer to allow the producing agent of record of the
3335	policy to continue servicing the policy for a period of not less
3336	than 1 year and offer to pay the agent the greater of the
3337	insurer's or the corporation's usual and customary commission
3338	for the type of policy written.
3339
3340	If the producing agent is unwilling or unable to accept
3341	appointment, the new insurer shall pay the agent in accordance
3342	with sub-sub-sub-subparagraph (A).
3343	(II)  When the corporation enters into a contractual
3344	agreement for a take-out plan, the producing agent of record of
3345	the corporation policy is entitled to retain any unearned
3346	commission on the policy, and the insurer shall:
3347	(A)  Pay to the producing agent of record of the
3348	corporation policy, for the first year, an amount that is the
3349	greater of the insurer's usual and customary commission for the
3350	type of policy written or a fee equal to the usual and customary
3351	commission of the corporation; or
3352	(B)  Offer to allow the producing agent of record of the
3353	corporation policy to continue servicing the policy for a period
3354	of not less than 1 year and offer to pay the agent the greater
3355	of the insurer's or the corporation's usual and customary
3356	commission for the type of policy written.
3357
3358	If the producing agent is unwilling or unable to accept
3359	appointment, the new insurer shall pay the agent in accordance
3360	with sub-sub-sub-subparagraph (A).
3361	b.  With respect to commercial lines residential risks, for
3362	a new application to the corporation for coverage, if the risk
3363	is offered coverage under a policy including wind coverage from
3364	an authorized insurer at its approved rate, the risk is not
3365	eligible for any policy issued by the corporation unless the
3366	premium for coverage from the authorized insurer is more than 25
3367	percent greater than the premium for comparable coverage from
3368	the corporation. If the risk is not able to obtain any such
3369	offer, the risk is eligible for a policy including wind coverage
3370	issued by the corporation. However, with regard to a
3371	policyholder of the corporation, the policyholder remains
3372	eligible for coverage from the corporation regardless of any
3373	offer of coverage from an authorized insurer or surplus lines
3374	insurer.
3375	(I)  If the risk accepts an offer of coverage through the
3376	market assistance plan or an offer of coverage through a
3377	mechanism established by the corporation before a policy is
3378	issued to the risk by the corporation or during the first 30
3379	days of coverage by the corporation, and the producing agent who
3380	submitted the application to the plan or the corporation is not
3381	currently appointed by the insurer, the insurer shall:
3382	(A)  Pay to the producing agent of record of the policy,
3383	for the first year, an amount that is the greater of the
3384	insurer's usual and customary commission for the type of policy
3385	written or a fee equal to the usual and customary commission of
3386	the corporation; or
3387	(B)  Offer to allow the producing agent of record of the
3388	policy to continue servicing the policy for a period of not less
3389	than 1 year and offer to pay the agent the greater of the
3390	insurer's or the corporation's usual and customary commission
3391	for the type of policy written.
3392
3393	If the producing agent is unwilling or unable to accept
3394	appointment, the new insurer shall pay the agent in accordance
3395	with sub-sub-sub-subparagraph (A).
3396	(II)  When the corporation enters into a contractual
3397	agreement for a take-out plan, the producing agent of record of
3398	the corporation policy is entitled to retain any unearned
3399	commission on the policy, and the insurer shall:
3400	(A)  Pay to the producing agent of record of the
3401	corporation policy, for the first year, an amount that is the
3402	greater of the insurer's usual and customary commission for the
3403	type of policy written or a fee equal to the usual and customary
3404	commission of the corporation; or
3405	(B)  Offer to allow the producing agent of record of the
3406	corporation policy to continue servicing the policy for a period
3407	of not less than 1 year and offer to pay the agent the greater
3408	of the insurer's or the corporation's usual and customary
3409	commission for the type of policy written.
3410
3411	If the producing agent is unwilling or unable to accept
3412	appointment, the new insurer shall pay the agent in accordance
3413	with sub-sub-sub-subparagraph (A).
3414	6.  Must provide by July 1, 2007, that an application for
3415	coverage for a new policy is subject to a waiting period of 10
3416	days before coverage is effective, during which time the
3417	corporation shall make such application available for review by
3418	general lines agents and authorized property and casualty
3419	insurers. The board shall may approve an exception exceptions
3420	that allows allow for coverage to be effective before the end of
3421	the 10-day waiting period, for coverage issued in conjunction
3422	with a real estate closing. The board may approve, and for such
3423	other exceptions as the board determines are necessary to
3424	prevent lapses in coverage.
3425	7.  Must include rules for classifications of risks and
3426	rates therefor.
3427	8.  Must provide that if premium and investment income for
3428	an account attributable to a particular calendar year are in
3429	excess of projected losses and expenses for the account
3430	attributable to that year, such excess shall be held in surplus
3431	in the account. Such surplus shall be available to defray
3432	deficits in that account as to future years and shall be used
3433	for that purpose prior to assessing assessable insurers and
3434	assessable insureds as to any calendar year.
3435	9.  Must provide objective criteria and procedures to be
3436	uniformly applied for all applicants in determining whether an
3437	individual risk is so hazardous as to be uninsurable. In making
3438	this determination and in establishing the criteria and
3439	procedures, the following shall be considered:
3440	a.  Whether the likelihood of a loss for the individual
3441	risk is substantially higher than for other risks of the same
3442	class; and
3443	b.  Whether the uncertainty associated with the individual
3444	risk is such that an appropriate premium cannot be determined.
3445
3446	The acceptance or rejection of a risk by the corporation shall
3447	be construed as the private placement of insurance, and the
3448	provisions of chapter 120 shall not apply.
3449	10.  Must provide that the corporation shall make its best
3450	efforts to procure catastrophe reinsurance at reasonable rates,
3451	to cover its projected 100-year probable maximum loss as
3452	determined by the board of governors.
3453	11.  Must provide that in the event of regular deficit
3454	assessments under sub-subparagraph (b)3.a. or sub-subparagraph
3455	(b)3.b., in the personal lines account, the commercial lines
3456	residential account, or the high-risk account, the corporation
3457	shall levy upon corporation policyholders in its next rate
3458	filing, or by a separate rate filing solely for this purpose, a
3459	Citizens policyholder surcharge arising from a regular
3460	assessment in such account in a percentage equal to the total
3461	amount of such regular assessments divided by the aggregate
3462	statewide direct written premium for subject lines of business
3463	for the prior calendar year. For purposes of calculating the
3464	Citizens policyholder surcharge to be levied under this
3465	subparagraph, the total amount of the regular assessment to
3466	which this surcharge is related shall be determined as set forth
3467	in subparagraph (b)3., without deducting the estimated Citizens
3468	policyholder surcharge. Citizens policyholder surcharges under
3469	this subparagraph are not considered premium and are not subject
3470	to commissions, fees, or premium taxes; however, failure to pay
3471	a market equalization surcharge shall be treated as failure to
3472	pay premium.
3473	12.  The policies issued by the corporation must provide
3474	that, if the corporation or the market assistance plan obtains
3475	an offer from an authorized insurer to cover the risk at its
3476	approved rates, the risk is no longer eligible for renewal
3477	through the corporation, except as otherwise provided in this
3478	subsection.
3479	13.  Corporation policies and applications must include a
3480	notice that the corporation policy could, under this section, be
3481	replaced with a policy issued by an authorized insurer that does
3482	not provide coverage identical to the coverage provided by the
3483	corporation. The notice shall also specify that acceptance of
3484	corporation coverage creates a conclusive presumption that the
3485	applicant or policyholder is aware of this potential.
3486	14.  May establish, subject to approval by the office,
3487	different eligibility requirements and operational procedures
3488	for any line or type of coverage for any specified county or
3489	area if the board determines that such changes to the
3490	eligibility requirements and operational procedures are
3491	justified due to the voluntary market being sufficiently stable
3492	and competitive in such area or for such line or type of
3493	coverage and that consumers who, in good faith, are unable to
3494	obtain insurance through the voluntary market through ordinary
3495	methods would continue to have access to coverage from the
3496	corporation. When coverage is sought in connection with a real
3497	property transfer, such requirements and procedures shall not
3498	provide for an effective date of coverage later than the date of
3499	the closing of the transfer as established by the transferor,
3500	the transferee, and, if applicable, the lender.
3501	15.  Must provide that, with respect to the high-risk
3502	account, any assessable insurer with a surplus as to
3503	policyholders of $25 million or less writing 25 percent or more
3504	of its total countrywide property insurance premiums in this
3505	state may petition the office, within the first 90 days of each
3506	calendar year, to qualify as a limited apportionment company. A
3507	regular assessment levied by the corporation on a limited
3508	apportionment company for a deficit incurred by the corporation
3509	for the high-risk account in 2006 or thereafter may be paid to
3510	the corporation on a monthly basis as the assessments are
3511	collected by the limited apportionment company from its insureds
3512	pursuant to s. 627.3512, but the regular assessment must be paid
3513	in full within 12 months after being levied by the corporation.
3514	A limited apportionment company shall collect from its
3515	policyholders any emergency assessment imposed under sub-
3516	subparagraph (b)3.d. The plan shall provide that, if the office
3517	determines that any regular assessment will result in an
3518	impairment of the surplus of a limited apportionment company,
3519	the office may direct that all or part of such assessment be
3520	deferred as provided in subparagraph (g)4. However, there shall
3521	be no limitation or deferment of an emergency assessment to be
3522	collected from policyholders under sub-subparagraph (b)3.d.
3523	16.  Must provide that the corporation appoint as its
3524	licensed agents only those agents who also hold an appointment
3525	as defined in s. 626.015(3) with an insurer who at the time of
3526	the agent's initial appointment by the corporation is authorized
3527	to write and is actually writing personal lines residential
3528	property coverage, commercial residential property coverage, or
3529	commercial nonresidential property coverage within the state.
3530	17.  Must provide, by July 1, 2007, a premium payment plan
3531	option to its policyholders which allows for quarterly and
3532	semiannual payment of premiums.
3533	18.  Must provide, effective June 1, 2007, that the
3534	corporation contract with each insurer providing the non-wind
3535	coverage for risks insured by the corporation in the high-risk
3536	account, requiring that the insurer provide claims adjusting
3537	services for the wind coverage provided by the corporation for
3538	such risks. An insurer is required to enter into this contract
3539	as a condition of providing non-wind coverage for a risk that is
3540	insured by the corporation in the high-risk account unless the
3541	board finds, after a hearing, that the insurer is not capable of
3542	providing adjusting services at an acceptable level of quality
3543	to corporation policyholders. The terms and conditions of such
3544	contracts must be substantially the same as the contracts that
3545	the corporation executed with insurers under the "adjust-your-
3546	own" program in 2006, except as may be mutually agreed to by the
3547	parties and except for such changes that the board determines
3548	are necessary to ensure that claims are adjusted appropriately.
3549	The corporation shall provide a process for neutral arbitration
3550	of any dispute between the corporation and the insurer regarding
3551	the terms of the contract. The corporation shall review and
3552	monitor the performance of insurers under these contracts.
3553	19.  Must limit coverage on mobile homes or manufactured
3554	homes built prior to 1994 to actual cash value of the dwelling
3555	rather than replacement costs of the dwelling.
3556	20.  May provide such limits of coverage as the board
3557	determines, consistent with the requirements of this subsection.
3558	21.  May require commercial property to meet specified
3559	hurricane mitigation construction features as a condition of
3560	eligibility for coverage.
3561	(m)1.
3562	a.  Rates for coverage provided by the corporation shall be
3563	actuarially sound and subject to the requirements of s. 627.062,
3564	except as otherwise provided in this paragraph. The corporation
3565	shall file its recommended rates with the office at least
3566	annually. The corporation shall provide any additional
3567	information regarding the rates which the office requires. The
3568	office shall consider the recommendations of the board and issue
3569	a final order establishing the rates for the corporation within
3570	45 days after the recommended rates are filed. The corporation
3571	may not pursue an administrative challenge or judicial review of
3572	the final order of the office. not competitive with approved
3573	rates charged in the admitted voluntary market, so that the
3574	corporation functions as a residual market mechanism to provide
3575	insurance only when the insurance cannot be procured in the
3576	voluntary market. Rates shall include an appropriate catastrophe
3577	loading factor that reflects the actual catastrophic exposure of
3578	the corporation. For policies in the personal lines account and
3579	the commercial lines account issued or renewed on or after March
3580	1, 2007, a rate is deemed inadequate if the rate, including
3581	investment income, is not sufficient to provide for the
3582	procurement of coverage under the Florida Hurricane Catastrophe
3583	Fund and private reinsurance costs, whether or not reinsurance
3584	is procured, and to pay all claims and expenses reasonably
3585	expected to result from a 100-year probable maximum loss event
3586	without resort to any regular or emergency assessments, long-
3587	term debt, state revenues, or other funding sources. For
3588	policies in the high-risk account issued or renewed on or after
3589	March 1, 2007, a rate is deemed inadequate if the rate,
3590	including investment income, is not sufficient to provide for
3591	the procurement of coverage under the Florida Hurricane
3592	Catastrophe Fund and private reinsurance costs, whether or not
3593	reinsurance is procured, and to pay all claims and expenses
3594	reasonably expected to result from a 70-year probable maximum
3595	loss event with resort to any regular or emergency assessments,
3596	long-term debt, state revenues, or other funding sources. For
3597	policies in the high-risk account issued or renewed in 2008 and
3598	2009, the rate must be based upon an 85-year and 100-year
3599	probable maximum loss event, respectively.
3600	b.  It is the intent of the Legislature to reaffirm the
3601	requirement of rate adequacy in the residual market. Recognizing
3602	that rates may comply with the intent expressed in sub-
3603	subparagraph a. and yet be inadequate and recognizing the public
3604	need to limit subsidies within the residual market, it is the
3605	further intent of the Legislature to establish statutory
3606	standards for rate adequacy. Such standards are intended to
3607	supplement the standard specified in s. 627.062(2)(e)3.,
3608	providing that rates are inadequate if they are clearly
3609	insufficient to sustain projected losses and expenses in the
3610	class of business to which they apply.
3611	2.  For each county, the average rates of the corporation
3612	for each line of business for personal lines residential
3613	policies excluding rates for wind-only policies shall be no
3614	lower than the average rates charged by the insurer that had the
3615	highest average rate in that county among the 20 insurers with
3616	the greatest total direct written premium in the state for that
3617	line of business in the preceding year, except that with respect
3618	to mobile home coverages, the average rates of the corporation
3619	shall be no lower than the average rates charged by the insurer
3620	that had the highest average rate in that county among the 5
3621	insurers with the greatest total written premium for mobile home
3622	owner's policies in the state in the preceding year.
3623	3.  Rates for personal lines residential wind-only policies
3624	must be actuarially sound and not competitive with approved
3625	rates charged by authorized insurers. If the filing under this
3626	subparagraph is made at least 90 days before the proposed
3627	effective date and the filing is not implemented during the
3628	office's review of the filing and any proceeding and judicial
3629	review, such filing shall be considered a "file and use" filing.
3630	In such case, the office shall finalize its review by issuance
3631	of a notice of intent to approve or a notice of intent to
3632	disapprove within 90 days after receipt of the filing. The
3633	notice of intent to approve and the notice of intent to
3634	disapprove constitute agency action for purposes of the
3635	Administrative Procedure Act. Requests for supporting
3636	information, requests for mathematical or mechanical
3637	corrections, or notification to the insurer by the office of its
3638	preliminary findings shall not toll the 90-day period during any
3639	such proceedings and subsequent judicial review. The rate shall
3640	be deemed approved if the office does not issue a notice of
3641	intent to approve or a notice of intent to disapprove within 90
3642	days after receipt of the filing. Corporation rate manuals shall
3643	include a rate surcharge for seasonal occupancy. To ensure that
3644	personal lines residential wind-only rates are not competitive
3645	with approved rates charged by authorized insurers, the
3646	corporation, in conjunction with the office, shall develop a
3647	wind-only ratemaking methodology, which methodology shall be
3648	contained in each rate filing made by the corporation with the
3649	office. If the office determines that the wind-only rates or
3650	rating factors filed by the corporation fail to comply with the
3651	wind-only ratemaking methodology provided for in this
3652	subsection, it shall so notify the corporation and require the
3653	corporation to amend its rates or rating factors to come into
3654	compliance within 90 days of notice from the office.
3655	4.  The requirements of this paragraph that rates not be
3656	competitive with approved rates charged by authorized insurers
3657	do not apply in a county or area for which the office determines
3658	that no authorized insurer is offering coverage. The corporation
3659	shall amend its rates or rating factors for the affected county
3660	or area in conjunction with its next rate filing after such
3661	determination is made.
3662	5.  For the purposes of establishing a pilot program to
3663	evaluate issues relating to the availability and affordability
3664	of insurance in an area where historically there has been little
3665	market competition, the provisions of subparagraph 2. do not
3666	apply to coverage provided by the corporation in Monroe County
3667	if the office determines that a reasonable degree of competition
3668	does not exist for personal lines residential policies. The
3669	provisions of subparagraph 3. do not apply to coverage provided
3670	by the corporation in Monroe County if the office determines
3671	that a reasonable degree of competition does not exist for
3672	personal lines residential policies in the area of that county
3673	which is eligible for wind-only coverage. In this county, the
3674	rates for personal lines residential coverage shall be
3675	actuarially sound and not excessive, inadequate, or unfairly
3676	discriminatory and are subject to the other provisions of the
3677	paragraph and s. 627.062. The commission shall adopt rules
3678	establishing the criteria for determining whether a reasonable
3679	degree of competition exists for personal lines residential
3680	policies in Monroe County. By March 1, 2006, the office shall
3681	submit a report to the Legislature providing an evaluation of
3682	the implementation of the pilot program affecting Monroe County.
3683	6.  Rates for commercial lines coverage shall not be
3684	subject to the requirements of subparagraph 2., but shall be
3685	subject to all other requirements of this paragraph and s.
3686	627.062.
3687	7.  Nothing in this paragraph shall require or allow the
3688	corporation to adopt a rate that is inadequate under s. 627.062.
3689	8.  The corporation shall certify to the office at least
3690	twice annually that its personal lines rates comply with the
3691	requirements of subparagraphs 1., 2., and 3. If any adjustment
3692	in the rates or rating factors of the corporation is necessary
3693	to ensure such compliance, the corporation shall make and
3694	implement such adjustments and file its revised rates and rating
3695	factors with the office. If the office thereafter determines
3696	that the revised rates and rating factors fail to comply with
3697	the provisions of subparagraphs 1., 2., and 3., it shall notify
3698	the corporation and require the corporation to amend its rates
3699	or rating factors in conjunction with its next rate filing. The
3700	office must notify the corporation by electronic means of any
3701	rate filing it approves for any insurer among the insurers
3702	referred to in subparagraph 2.
3703	2.9.  In addition to the rates otherwise determined
3704	pursuant to this paragraph, the corporation shall impose and
3705	collect an amount equal to the premium tax provided for in s.
3706	624.509 to augment the financial resources of the corporation.
3707	10.  The corporation shall develop a notice to
3708	policyholders or applicants that the rates of Citizens Property
3709	Insurance Corporation are intended to be higher than the rates
3710	of any admitted carrier and providing other information the
3711	corporation deems necessary to assist consumers in finding other
3712	voluntary admitted insurers willing to insure their property.
3713	3.11.  After the public hurricane loss-projection model
3714	under s. 627.06281 has been found to be accurate and reliable by
3715	the Florida Commission on Hurricane Loss Projection Methodology,
3716	that model shall serve as the minimum benchmark for determining
3717	the windstorm portion of the corporation's rates. This
3718	subparagraph does not require or allow the corporation to adopt
3719	rates lower than the rates otherwise required or allowed by this
3720	paragraph.
3721	4.  The rate filings for the corporation which were
3722	approved by the office and which took effect January 1, 2007,
3723	are rescinded, except for those rates that were lowered. As soon
3724	as possible, the corporation shall begin using the lower rates
3725	that were in effect on December 31, 2006, and shall provide
3726	refunds to policyholders who have paid higher rates as a result
3727	of that rate filing. The rates in effect on December 31, 2006,
3728	shall remain in effect for the 2007 calendar year except for any
3729	rate change that results in a lower rate. The next rate change
3730	that may increase rates shall take effect January 1, 2008,
3731	pursuant to a new rate filing recommended by the corporation and
3732	established by the office, subject to the requirements of this
3733	paragraph.
3734	(p)1.  The corporation shall certify to the office its
3735	needs for annual assessments as to a particular calendar year,
3736	and for any interim assessments that it deems to be necessary to
3737	sustain operations as to a particular year pending the receipt
3738	of annual assessments. Upon verification, the office shall
3739	approve such certification, and the corporation shall levy such
3740	annual or interim assessments. Such assessments shall be
3741	prorated as provided in paragraph (b). The corporation shall
3742	take all reasonable and prudent steps necessary to collect the
3743	amount of assessment due from each assessable insurer,
3744	including, if prudent, filing suit to collect such assessment.
3745	If the corporation is unable to collect an assessment from any
3746	assessable insurer, the uncollected assessments shall be levied
3747	as an additional assessment against the assessable insurers and
3748	any assessable insurer required to pay an additional assessment
3749	as a result of such failure to pay shall have a cause of action
3750	against such nonpaying assessable insurer. Assessments shall be
3751	included as an appropriate factor in the making of rates. The
3752	failure of a surplus lines agent to collect and remit any
3753	regular or emergency assessment levied by the corporation is
3754	considered to be a violation of s. 626.936 and subjects the
3755	surplus lines agent to the penalties provided in that section.
3756	2.  The governing body of any unit of local government, any
3757	residents of which are insured by the corporation, may issue
3758	bonds as defined in s. 125.013 or s. 166.101 from time to time
3759	to fund an assistance program, in conjunction with the
3760	corporation, for the purpose of defraying deficits of the
3761	corporation. In order to avoid needless and indiscriminate
3762	proliferation, duplication, and fragmentation of such assistance
3763	programs, any unit of local government, any residents of which
3764	are insured by the corporation, may provide for the payment of
3765	losses, regardless of whether or not the losses occurred within
3766	or outside of the territorial jurisdiction of the local
3767	government. Revenue bonds under this subparagraph may not be
3768	issued until validated pursuant to chapter 75, unless a state of
3769	emergency is declared by executive order or proclamation of the
3770	Governor pursuant to s. 252.36 making such findings as are
3771	necessary to determine that it is in the best interests of, and
3772	necessary for, the protection of the public health, safety, and
3773	general welfare of residents of this state and declaring it an
3774	essential public purpose to permit certain municipalities or
3775	counties to issue such bonds as will permit relief to claimants
3776	and policyholders of the corporation. Any such unit of local
3777	government may enter into such contracts with the corporation
3778	and with any other entity created pursuant to this subsection as
3779	are necessary to carry out this paragraph. Any bonds issued
3780	under this subparagraph shall be payable from and secured by
3781	moneys received by the corporation from emergency assessments
3782	under sub-subparagraph (b)3.d., and assigned and pledged to or
3783	on behalf of the unit of local government for the benefit of the
3784	holders of such bonds.  The funds, credit, property, and taxing
3785	power of the state or of the unit of local government shall not
3786	be pledged for the payment of such bonds. If any of the bonds
3787	remain unsold 60 days after issuance, the office shall require
3788	all insurers subject to assessment to purchase the bonds, which
3789	shall be treated as admitted assets; each insurer shall be
3790	required to purchase that percentage of the unsold portion of
3791	the bond issue that equals the insurer's relative share of
3792	assessment liability under this subsection. An insurer shall not
3793	be required to purchase the bonds to the extent that the office
3794	determines that the purchase would endanger or impair the
3795	solvency of the insurer.
3796	3.a.  The corporation shall adopt one or more programs
3797	subject to approval by the office for the reduction of both new
3798	and renewal writings in the corporation. Beginning January 1,
3799	2008, any program the corporation adopts for the payment of
3800	bonuses to an insurer for each risk the insurer removes from the
3801	corporation shall comply with s. 627.3511(2) and may not exceed
3802	the amount referenced in s. 627.3511(2) for each risk removed.
3803	The corporation may consider any prudent and not unfairly
3804	discriminatory approach to reducing corporation writings, and
3805	may adopt a credit against assessment liability or other
3806	liability that provides an incentive for insurers to take risks
3807	out of the corporation and to keep risks out of the corporation
3808	by maintaining or increasing voluntary writings in counties or
3809	areas in which corporation risks are highly concentrated and a
3810	program to provide a formula under which an insurer voluntarily
3811	taking risks out of the corporation by maintaining or increasing
3812	voluntary writings will be relieved wholly or partially from
3813	assessments under sub-subparagraphs (b)3.a. and b. However, any
3814	"take-out bonus" or payment to an insurer must be conditioned on
3815	the property being insured for at least 5 years by the insurer,
3816	unless canceled or nonrenewed by the policyholder. If the policy
3817	is canceled or nonrenewed by the policyholder before the end of
3818	the 5-year period, the amount of the take-out bonus must be
3819	prorated for the time period the policy was insured. When the
3820	corporation enters into a contractual agreement for a take-out
3821	plan, the producing agent of record of the corporation policy is
3822	entitled to retain any unearned commission on such policy, and
3823	the insurer shall either:
3824	(I)  Pay to the producing agent of record of the policy,
3825	for the first year, an amount which is the greater of the
3826	insurer's usual and customary commission for the type of policy
3827	written or a policy fee equal to the usual and customary
3828	commission of the corporation; or
3829	(II)  Offer to allow the producing agent of record of the
3830	policy to continue servicing the policy for a period of not less
3831	than 1 year and offer to pay the agent the insurer's usual and
3832	customary commission for the type of policy written. If the
3833	producing agent is unwilling or unable to accept appointment by
3834	the new insurer, the new insurer shall pay the agent in
3835	accordance with sub-sub-subparagraph (I).
3836	b.  Any credit or exemption from regular assessments
3837	adopted under this subparagraph shall last no longer than the 3
3838	years following the cancellation or expiration of the policy by
3839	the corporation. With the approval of the office, the board may
3840	extend such credits for an additional year if the insurer
3841	guarantees an additional year of renewability for all policies
3842	removed from the corporation, or for 2 additional years if the
3843	insurer guarantees 2 additional years of renewability for all
3844	policies so removed.
3845	c.  There shall be no credit, limitation, exemption, or
3846	deferment from emergency assessments to be collected from
3847	policyholders pursuant to sub-subparagraph (b)3.d.
3848	4.  The plan shall provide for the deferment, in whole or
3849	in part, of the assessment of an assessable insurer, other than
3850	an emergency assessment collected from policyholders pursuant to
3851	sub-subparagraph (b)3.d., if the office finds that payment of
3852	the assessment would endanger or impair the solvency of the
3853	insurer. In the event an assessment against an assessable
3854	insurer is deferred in whole or in part, the amount by which
3855	such assessment is deferred may be assessed against the other
3856	assessable insurers in a manner consistent with the basis for
3857	assessments set forth in paragraph (b).
3858	5.  Effective July 1, 2007, in order to evaluate the costs
3859	and benefits of approved take-out plans, if the corporation pays
3860	a bonus or other payment to an insurer for an approved take-out
3861	plan, it shall maintain a record of the address or such other
3862	identifying information on the property or risk removed in order
3863	to track if and when the property or risk is later insured by
3864	the corporation.
3865	6.  Any policy taken out, assumed, or removed from the
3866	corporation is, as of the effective date of the take-out,
3867	assumption, or removal, direct insurance issued by the insurer
3868	and not by the corporation, even if the corporation continues to
3869	service the policies. This subparagraph applies to policies of
3870	the corporation and not policies taken out, assumed, or removed
3871	from any other entity.
3872	(s)  For the purposes of s. 199.183(1), the corporation
3873	shall be considered a political subdivision of the state and
3874	shall be exempt from the corporate income tax. The premiums,
3875	assessments, investment income, and other revenue of the
3876	corporation are funds received for providing property insurance
3877	coverage as required by this subsection, paying claims for
3878	Florida citizens insured by the corporation, securing and
3879	repaying debt obligations issued by the corporation, and
3880	conducting all other activities of the corporation, and shall
3881	not be considered taxes, fees, licenses, or charges for services
3882	imposed by the Legislature on individuals, businesses, or
3883	agencies outside state government. Bonds and other debt
3884	obligations issued by or on behalf of the corporation are not to
3885	be considered "state bonds" within the meaning of s. 215.58(8).
3886	The corporation is not subject to the procurement provisions of
3887	chapter 287, and policies and decisions of the corporation
3888	relating to incurring debt, levying of assessments and the sale,
3889	issuance, continuation, terms and claims under corporation
3890	policies, and all services relating thereto, are not subject to
3891	the provisions of chapter 120. The corporation is not required
3892	to obtain or to hold a certificate of authority issued by the
3893	office, nor is it required to participate as a member insurer of
3894	the Florida Insurance Guaranty Association. However, the
3895	corporation is required to pay, in the same manner as an
3896	authorized insurer, assessments levied pledged by the Florida
3897	Insurance Guaranty Association to secure bonds issued or other
3898	indebtedness incurred to pay covered claims arising from insurer
3899	insolvencies caused by, or proximately related to, hurricane
3900	losses. It is the intent of the Legislature that the tax
3901	exemptions provided in this paragraph will augment the financial
3902	resources of the corporation to better enable the corporation to
3903	fulfill its public purposes. Any debt obligations issued by the
3904	corporation, their transfer, and the income therefrom, including
3905	any profit made on the sale thereof, shall at all times be free
3906	from taxation of every kind by the state and any political
3907	subdivision or local unit or other instrumentality thereof;
3908	however, this exemption does not apply to any tax imposed by
3909	chapter 220 on interest, income, or profits on debt obligations
3910	owned by corporations other than the corporation.
3911	(ee)  The assets of the corporation may be invested and
3912	managed by the State Board of Administration.
3913	Section 22.  It is the intent of the Legislature that
3914	commercial nonresidential property insurance coverage be made
3915	available from Citizens Property Insurance Corporation
3916	(Citizens), under s. 627.351(6), Florida Statutes, as amended by
3917	this act, rather than from the Property and Casualty Joint
3918	Underwriting Association (PCJUA), under s. 627.351(5), Florida
3919	Statutes. As soon as it is reasonably able to do so, Citizens
3920	shall adopt, subject to approval of the Office of Insurance
3921	Regulation, a plan providing for the transition of such coverage
3922	from the PCJUA to Citizens under such forms, rates, terms, and
3923	conditions as the board of Citizens considers appropriate. The
3924	plan shall include any contractual agreements between Citizens
3925	and the PCJUA which are required to effect the transition. In
3926	the transition plan, Citizens may assume policies or otherwise
3927	provide coverage for the commercial nonresidential policyholders
3928	of the PCJUA and may also provide for allocating to the
3929	appropriate account or accounts of Citizens the revenues,
3930	assets, liabilities, losses, and expenses associated with
3931	policies of the PCJUA which are assumed or otherwise covered by
3932	Citizens. It is the intent of the Legislature that the
3933	transition plan be implemented in a manner that does not
3934	adversely affect the creditworthiness of or security for
3935	currently outstanding financing obligations or credit facilities
3936	of the high-risk account, the personal lines account, or the
3937	commercial lines account. The order issued by the Office of
3938	Insurance Regulation may allow the PCJUA to continue to issue
3939	such coverage until the time that Citizens begins issuing such
3940	coverage.
3941	Section 23.  Subsection (3) is added to section 627.3515,
3942	Florida Statutes, to read:
3943	627.3515  Market assistance plan; property and casualty
3944	risks.--
3945	(3)(a)  The plan and the corporation shall develop a
3946	business plan and present it to the Financial Services
3947	Commission for approval by September 1, 2007, to provide for the
3948	implementation of an electronic database for the purpose of
3949	confirming eligibility pursuant to s. 627.351(6).
3950	(b)  There shall be no liability on the part of, and no
3951	cause of action of any nature shall arise against, any
3952	authorized insurer acting within the scope of its authority
3953	under this subsection or its agents or employees for any action
3954	taken by them in the performance of their duties or
3955	responsibilities under this subsection.
3956	Section 24.  Subsection (1) of section 627.4035, Florida
3957	Statutes, is amended to read:
3958	627.4035  Cash payment of premiums; claims.--
3959	(1)  The premiums for insurance contracts issued in this
3960	state or covering risk located in this state shall be paid in
3961	cash consisting of coins, currency, checks, or money orders or
3962	by using a debit card, credit card, automatic electronic funds
3963	transfer, or payroll deduction plan. By July 1, 2007, insurers
3964	issuing personal lines residential and commercial property
3965	policies shall provide a premium payment plan option to their
3966	policyholders which allows for quarterly and semiannual payment
3967	of premiums. Insurers issuing such policies must submit their
3968	premium payment plan option to the office for approval before
3969	use.
3970	Section 25.  Paragraph (b) of subsection (2) of section
3971	627.4133, Florida Statutes, is amended to read:
3972	627.4133  Notice of cancellation, nonrenewal, or renewal
3973	premium.--
3974	(2)  With respect to any personal lines or commercial
3975	residential property insurance policy, including, but not
3976	limited to, any homeowner's, mobile home owner's, farmowner's,
3977	condominium association, condominium unit owner's, apartment
3978	building, or other policy covering a residential structure or
3979	its contents:
3980	(b)  The insurer shall give the named insured written
3981	notice of nonrenewal, cancellation, or termination at least 100
3982	90 days prior to the effective date of the nonrenewal,
3983	cancellation, or termination. However, the insurer shall give at
3984	least 100 days' written notice, or written notice by June 1,
3985	whichever is earlier, for any nonrenewal, cancellation, or
3986	termination that would be effective between June 1 and November
3987	30. The notice must include the reason or reasons for the
3988	nonrenewal, cancellation, or termination, except that:
3989	1.  When cancellation is for nonpayment of premium, at
3990	least 10 days' written notice of cancellation accompanied by the
3991	reason therefor shall be given. As used in this subparagraph,
3992	the term "nonpayment of premium" means failure of the named
3993	insured to discharge when due any of her or his obligations in
3994	connection with the payment of premiums on a policy or any
3995	installment of such premium, whether the premium is payable
3996	directly to the insurer or its agent or indirectly under any
3997	premium finance plan or extension of credit, or failure to
3998	maintain membership in an organization if such membership is a
3999	condition precedent to insurance coverage. "Nonpayment of
4000	premium" also means the failure of a financial institution to
4001	honor an insurance applicant's check after delivery to a
4002	licensed agent for payment of a premium, even if the agent has
4003	previously delivered or transferred the premium to the insurer.
4004	If a dishonored check represents the initial premium payment,
4005	the contract and all contractual obligations shall be void ab
4006	initio unless the nonpayment is cured within the earlier of 5
4007	days after actual notice by certified mail is received by the
4008	applicant or 15 days after notice is sent to the applicant by
4009	certified mail or registered mail, and if the contract is void,
4010	any premium received by the insurer from a third party shall be
4011	refunded to that party in full.
4012	2.  When such cancellation or termination occurs during the
4013	first 90 days during which the insurance is in force and the
4014	insurance is canceled or terminated for reasons other than
4015	nonpayment of premium, at least 20 days' written notice of
4016	cancellation or termination accompanied by the reason therefor
4017	shall be given except where there has been a material
4018	misstatement or misrepresentation or failure to comply with the
4019	underwriting requirements established by the insurer.
4020
4021	After the policy has been in effect for 90 days, the policy
4022	shall not be canceled by the insurer except when there has been
4023	a material misstatement, a nonpayment of premium, a failure to
4024	comply with underwriting requirements established by the insurer
4025	within 90 days of the date of effectuation of coverage, or a
4026	substantial change in the risk covered by the policy or when the
4027	cancellation is for all insureds under such policies for a given
4028	class of insureds. This paragraph does not apply to individually
4029	rated risks having a policy term of less than 90 days.
4030	Section 26.  A residential property insurer shall return
4031	all excess profits to policyholders except as otherwise directed
4032	by the Office of Insurance Regulation. A residential property
4033	insurer shall be deemed to have earned an excess profit if its
4034	surplus exceeds its direct probable maximum loss for a 1-in-250-
4035	year return period and it has earned a net underwriting gain in
4036	Florida in excess of 10 percent of earned premiums above its
4037	anticipated underwriting profit over the most recent 10-year
4038	period.
4039	Section 27.  Section 627.4261, Florida Statutes, is
4040	transferred and renumbered as section 627.70131, Florida
4041	Statutes, and subsection (5) is added to that section, to read:
4042	627.70131 627.4261  Insurer's duty to acknowledge
4043	communications regarding claims; investigation.--
4044	(5)  Within 90 days after an insurer receives notice of a
4045	property insurance claim from a policyholder, the insurer shall
4046	pay or deny such claim unless the failure to pay such claim is
4047	caused by factors beyond the control of the insurer which
4048	reasonably prevent such payment. Failure to comply with this
4049	subsection constitutes a violation of this code.
4050	Section 28.  Subsections (3), (4), and (9) of section
4051	627.701, Florida Statutes, are amended to read:
4052	627.701  Liability of insureds; coinsurance; deductibles.--
4053	(3)(a)  A policy of residential property insurance shall
4054	include a deductible amount applicable to hurricane losses no
4055	lower than $500 and no higher than 2 percent of the policy
4056	dwelling limits with respect to personal lines residential
4057	risks, and no higher than 3 percent of the policy limits with
4058	respect to commercial lines residential risks; however, if a
4059	risk was covered on August 24, 1992, under a policy having a
4060	higher deductible than the deductibles allowed by this
4061	paragraph, a policy covering such risk may include a deductible
4062	no higher than the deductible in effect on August 24, 1992.
4063	Notwithstanding the other provisions of this paragraph, a
4064	personal lines residential policy covering a risk valued at
4065	$50,000 or less may include a deductible amount attributable to
4066	hurricane losses no lower than $250, and a personal lines
4067	residential policy covering a risk valued at $100,000 or more
4068	may include a deductible amount attributable to hurricane losses
4069	no higher than 10 percent of the policy limits unless subject to
4070	a higher deductible on August 24, 1992; however, no maximum
4071	deductible is required with respect to a personal lines
4072	residential policy covering a risk valued at more than $500,000.
4073	An insurer may require a higher deductible, provided such
4074	deductible is the same as or similar to a deductible program
4075	lawfully in effect on June 14, 1995. In addition to the
4076	deductible amounts authorized by this paragraph, an insurer may
4077	also offer policies with a copayment provision under which,
4078	after exhaustion of the deductible, the policyholder is
4079	responsible for 10 percent of the next $10,000 of insured
4080	hurricane losses.
4081	(a)(b)1.  Except as otherwise provided in this subsection
4082	paragraph, prior to issuing a personal lines residential
4083	property insurance policy on or after January 1, 2006, or prior
4084	to the first renewal of a residential property insurance policy
4085	on or after January 1, 2006, the insurer must offer alternative
4086	deductible amounts applicable to hurricane losses equal to $500,
4087	2 percent, 5 percent, and 10 percent of the policy dwelling
4088	limits, unless the specific percentage deductible is less than
4089	$500. The written notice of the offer shall specify the
4090	hurricane or wind deductible to be applied in the event that the
4091	applicant or policyholder fails to affirmatively choose a
4092	hurricane deductible. The insurer must provide such policyholder
4093	with notice of the availability of the deductible amounts
4094	specified in this paragraph in a form approved by the office in
4095	conjunction with each renewal of the policy. The failure to
4096	provide such notice constitutes a violation of this code but
4097	does not affect the coverage provided under the policy.
4098	(b)2.  This subsection paragraph does not apply with
4099	respect to a deductible program lawfully in effect on June 14,
4100	1995, or to any similar deductible program, if the deductible
4101	program requires a minimum deductible amount of no less than 2
4102	percent of the policy limits.
4103	(c)3.  With respect to a policy covering a risk with
4104	dwelling limits of at least $100,000, but less than $250,000,
4105	the insurer may, in lieu of offering a policy with a $500
4106	hurricane or wind deductible as required by paragraph (a)
4107	subparagraph 1., offer a policy that the insurer guarantees it
4108	will not nonrenew for reasons of reducing hurricane loss for one
4109	renewal period and that contains up to a 2 percent hurricane or
4110	wind deductible as required by paragraph (a) subparagraph 1.
4111	(d)4.  With respect to a policy covering a risk with
4112	dwelling limits of $250,000 or more, the insurer need not offer
4113	the $500 hurricane deductible as required by paragraph (a)
4114	subparagraph 1., but must, except as otherwise provided in this
4115	subsection, offer the other hurricane deductibles as required by
4116	paragraph (a) subparagraph 1.
4117	(4)(a)  Any policy that contains a separate hurricane
4118	deductible must on its face include in boldfaced type no smaller
4119	than 18 points the following statement: "THIS POLICY CONTAINS A
4120	SEPARATE DEDUCTIBLE FOR HURRICANE LOSSES, WHICH MAY RESULT IN
4121	HIGH OUT-OF-POCKET EXPENSES TO YOU." A policy containing a
4122	coinsurance provision applicable to hurricane losses must on its
4123	face include in boldfaced type no smaller than 18 points the
4124	following statement: "THIS POLICY CONTAINS A CO-PAY PROVISION
4125	THAT MAY RESULT IN HIGH OUT-OF-POCKET EXPENSES TO YOU."
4126	(b)  Beginning October 1, 2005, For any personal lines
4127	residential property insurance policy containing a separate
4128	hurricane deductible, the insurer shall compute and prominently
4129	display the actual dollar value of the hurricane deductible on
4130	the declarations page of the policy at issuance and, for
4131	renewal, on the renewal declarations page of the policy or on
4132	the premium renewal notice.
4133	(c)  Beginning October 1, 2005, For any personal lines
4134	residential property insurance policy containing an inflation
4135	guard rider, the insurer shall compute and prominently display
4136	the actual dollar value of the hurricane deductible on the
4137	declarations page of the policy at issuance and, for renewal, on
4138	the renewal declarations page of the policy or on the premium
4139	renewal notice. In addition, beginning October 1, 2005, for any
4140	personal lines residential property insurance policy containing
4141	an inflation guard rider, the insurer shall notify the
4142	policyholder of the possibility that the hurricane deductible
4143	may be higher than indicated when loss occurs due to application
4144	of the inflation guard rider. Such notification shall be made on
4145	the declarations page of the policy at issuance and, for
4146	renewal, on the renewal declarations page of the policy or on
4147	the premium renewal notice.
4148	(d)1.  A personal lines residential property insurance
4149	policy covering a risk valued at less than $500,000 may not have
4150	a hurricane deductible in excess of 10 percent of the policy
4151	dwelling limits, unless the following conditions are met:
4152	a.  The policyholder must personally write and provide to
4153	the insurer the following statement in his or her own
4154	handwriting and signs his or her name, which must also be signed
4155	by every other named insured on the policy, and dated: "I do not
4156	want the insurance on my home to pay for the first (specify
4157	dollar value) of damage from hurricanes. I will pay those costs.
4158	My insurance will not."
4159	b.  If the structure insured by the policy is subject to a
4160	mortgage or lien, the policyholder must provide the insurer with
4161	a written statement from the mortgageholder or lienholder
4162	indicating that the mortgageholder or lienholder approves the
4163	policyholder electing to have the specified deductible.
4164	2.  A deductible subject to the requirements of this
4165	paragraph applies for the term of the policy and for each
4166	renewal unless the policyholder elects otherwise.
4167	3.  An insurer shall keep the original copy of the signed
4168	statement required by this paragraph and provide a copy to the
4169	policyholder providing the signed statement. A signed statement
4170	meeting the requirements of this paragraph creates a presumption
4171	that there was an informed, knowing election of coverage.
4172	4.  The commission shall adopt rules providing appropriate
4173	alternative methods for providing the statements required by
4174	this section for policyholders who have a handicapping or
4175	disabling condition that prevents them from providing a
4176	handwritten statement.
4177	(9)  With respect to hurricane coverage provided in a
4178	policy of residential coverage, when the policyholder has taken
4179	appropriate hurricane mitigation measures regarding the
4180	residence covered under the policy, the insurer shall may
4181	provide the insured the option of selecting an appropriate
4182	reduction in the policy's hurricane deductible or in lieu of
4183	selecting the appropriate discount credit or other rate
4184	differential as provided in s. 627.0629. If made available by
4185	the insurer, The insurer must provide the policyholder with
4186	notice of the options available under this subsection on a form
4187	approved by the office.
4188	Section 29.  Effective April 1, 2007, section 627.7018,
4189	Florida Statutes, is created to read:
4190	627.7018  Standards for determining risk of coverage.--In
4191	determining the risk of providing property insurance coverage,
4192	an insurer may not deny coverage solely on the basis of the age
4193	of the structure and shall consider the wind resistance of the
4194	structure and measures undertaken by the owner to protect the
4195	structure against hurricane loss.
4196	Section 30.  Section 627.706, Florida Statutes, is amended
4197	to read:
4198	627.706  Sinkhole insurance; catastrophic ground cover
4199	collapse; definitions.--
4200	(1)  Every insurer authorized to transact property
4201	insurance in this state shall provide coverage for a
4202	catastrophic ground cover collapse and shall make available, for
4203	an appropriate additional premium, coverage for insurable
4204	sinkhole losses on any structure, including contents of personal
4205	property contained therein, to the extent provided in the form
4206	to which the sinkhole coverage attaches. A policy for
4207	residential property insurance may include a deductible amount
4208	applicable to sinkhole losses equal to 1 percent, 2 percent, 5
4209	percent, or 10 percent of the policy dwelling limits, with
4210	appropriate premium discounts offered with each deductible
4211	amount.
4212	(2)  As used in ss. 627.706-627.7074, and as used in
4213	connection with any policy providing coverage for a catastrophic
4214	ground cover collapse or for sinkhole losses:
4215	(a)  "Catastrophic ground cover collapse" means geological
4216	activity that results in all the following:
4217	1.  The abrupt collapse of the ground cover;
4218	2.  A depression in the ground cover clearly visible to the
4219	naked eye;
4220	3.  Structural damage to the building, including the
4221	foundation; and
4222	4.  The insured structure being condemned and ordered to be
4223	vacated by the governmental agency authorized by law to issue
4224	such an order for that structure.
4225
4226	Contents coverage applies if there is a loss resulting from a
4227	catastrophic ground cover collapse. Structural damage consisting
4228	merely of the settling or cracking of a foundation, structure,
4229	or building does not constitute a loss resulting from a
4230	catastrophic ground cover collapse.
4231	(b)(a)  "Sinkhole" means a landform created by subsidence
4232	of soil, sediment, or rock as underlying strata are dissolved by
4233	groundwater. A sinkhole may form by collapse into subterranean
4234	voids created by dissolution of limestone or dolostone or by
4235	subsidence as these strata are dissolved.
4236	(c)(b)  "Sinkhole loss" means structural damage to the
4237	building, including the foundation, caused by sinkhole activity.
4238	Contents coverage shall apply only if there is structural damage
4239	to the building caused by sinkhole activity.
4240	(d)(c)  "Sinkhole activity" means settlement or systematic
4241	weakening of the earth supporting such property only when such
4242	settlement or systematic weakening results from movement or
4243	raveling of soils, sediments, or rock materials into
4244	subterranean voids created by the effect of water on a limestone
4245	or similar rock formation.
4246	(e)(d)  "Professional engineer" means a person, as defined
4247	in s. 471.005, who has a bachelor's degree or higher in
4248	engineering with a specialty in the geotechnical engineering
4249	field. A professional engineer must have geotechnical experience
4250	and expertise in the identification of sinkhole activity as well
4251	as other potential causes of damage to the structure.
4252	(f)(e)  "Professional geologist" means a person, as defined
4253	by s. 492.102, who has a bachelor's degree or higher in geology
4254	or related earth science with expertise in the geology of
4255	Florida. A professional geologist must have geological
4256	experience and expertise in the identification of sinkhole
4257	activity as well as other potential geologic causes of damage to
4258	the structure.
4259	(3)  On or before June 1, 2007, every insurer authorized to
4260	transact property insurance in this state shall make a proper
4261	filing with the office for the purpose of extending the
4262	appropriate forms of property insurance to include coverage for
4263	catastrophic ground cover collapse or for sinkhole losses.
4264	Coverage for catastrophic ground cover collapse may not go into
4265	effect until the effective date provided for in the filing
4266	approved by the office.
4267	(4)  Insurers offering policies that exclude coverage for
4268	sinkhole losses shall inform policyholders in bold type of not
4269	less than 14 points as follows: "YOUR POLICY PROVIDES COVERAGE
4270	FOR A CATASTROPHIC GROUND COVER COLLAPSE THAT RESULTS IN THE
4271	PROPERTY BEING CONDEMNED AND UNINHABITABLE. OTHERWISE, YOUR
4272	POLICY DOES NOT PROVIDE COVERAGE FOR SINKHOLE LOSSES. YOU MAY
4273	PURCHASE ADDITIONAL COVERAGE FOR SINKHOLE LOSSES FOR AN
4274	ADDITIONAL PREMIUM."
4275	Section 31.  Effective March 1, 2007, section 627.711,
4276	Florida Statutes, is amended to read:
4277	627.711  Notice of premium discounts for hurricane loss
4278	mitigation; uniform mitigation verification inspection form.--
4279	(1)  Using a form prescribed by the Office of Insurance
4280	Regulation, the insurer shall clearly notify the applicant or
4281	policyholder of any personal lines residential property
4282	insurance policy, at the time of the issuance of the policy and
4283	at each renewal, of the availability and the range of each
4284	premium discount, credit, other rate differential, or reduction
4285	in deductibles, and combinations of discounts, credits, rate
4286	differentials, or reductions in deductibles, for properties on
4287	which fixtures or construction techniques demonstrated to reduce
4288	the amount of loss in a windstorm can be or have been installed
4289	or implemented. The prescribed form shall describe generally
4290	what actions the policyholders may be able to take to reduce
4291	their windstorm premium. The prescribed form and a list of such
4292	ranges approved by the office for each insurer licensed in the
4293	state and providing such discounts, credits, other rate
4294	differentials, or reductions in deductibles for properties
4295	described in this subsection shall be available for electronic
4296	viewing and download from the Department of Financial Services'
4297	or the Office of Insurance Regulation's Internet website. The
4298	Financial Services Commission may adopt rules to implement this
4299	subsection.
4300	(2)  By July 1, 2007, the Financial Services Commission
4301	shall develop by rule a uniform mitigation verification
4302	inspection form that shall be used by all insurers when
4303	factoring discounts for wind insurance. In developing the form,
4304	the commission shall seek input from insurance, construction,
4305	and building code representatives. Further, the commission shall
4306	provide guidance as to the length of time the inspection results
4307	are valid.
4308	Section 32.  Effective July 1, 2007, section 627.712,
4309	Florida Statutes, is created to read:
4310	627.712  Residential hurricane coverage required;
4311	availability of exclusions for windstorm or contents.--
4312	(1)  An insurer issuing a residential property insurance
4313	policy must provide hurricane or windstorm coverage as defined
4314	in s. 627.4025. This subsection does not apply with respect to
4315	risks that are eligible for wind-only coverage from Citizens
4316	Property Insurance Corporation under s. 627.351(6).
4317	(2)  An insurer that is subject to subsection (1) must make
4318	available, at the option of the policyholder, an exclusion of
4319	hurricane coverage or windstorm coverage. The coverage may be
4320	excluded only if:
4321	(a)  The policyholder personally writes and provides to the
4322	insurer the following statement in his or her own handwriting
4323	and signs his or her name, which must also be signed by every
4324	other named insured on the policy, and dated: "I do not want the
4325	insurance on my (home / mobile home / condominium unit) to pay
4326	for damage from windstorms or hurricanes. I will pay those
4327	costs. My insurance will not."
4328	(b)  If the structure insured by the policy is subject to a
4329	mortgage or lien, the policyholder must provide the insurer with
4330	a written statement from the mortgageholder or lienholder
4331	indicating that the mortgageholder or lienholder approves the
4332	policyholder electing to exclude windstorm coverage or hurricane
4333	coverage from his or her residential property insurance policy.
4334	(3)  An insurer issuing a residential property insurance
4335	policy, except for a condominium unit owner's policy, must make
4336	available, at the option of the policyholder, an exclusion of
4337	coverage for the contents. The coverage may be excluded only if
4338	the policyholder personally writes and provides to the insurer
4339	the following statement in his or her own handwriting and signs
4340	his or her signature, which must also be signed by every other
4341	named insured on the policy, and dated: "I do not want the
4342	insurance on my (home / mobile home) to pay for the costs to
4343	repair or replace any contents that are damaged. I will pay
4344	those costs. My insurance will not."
4345	(4)  An insurer shall keep the original copy of a signed
4346	statement required by this section and provide a copy to the
4347	policyholder providing the signed statement. A signed statement
4348	meeting the requirements of this section creates a presumption
4349	that there was an informed, knowing rejection of coverage.
4350	(5)  The exclusions authorized by this section are valid
4351	for the term of the contract and for each renewal unless the
4352	policyholder elects otherwise.
4353	(6)  The commission shall adopt rules providing appropriate
4354	alternative methods for providing the statements required by
4355	this section for policyholders who have a handicapping or
4356	disabling condition that prevents them from providing a
4357	handwritten statement.
4358	(7)  This section is effective July 1, 2007, but the office
4359	may delay application of this section until a date no later than
4360	October 1, 2007, upon approval by the Financial Services
4361	Commission.
4362	Section 33.  Section 627.713, Florida Statutes, is created
4363	to read:
4364	627.713  Report of hurricane loss data.--The office may
4365	require property insurers to report data regarding hurricane
4366	claims and underwriting costs, including, but not limited to:
4367	(1)  Number of claims.
4368	(2)  Amount of claim payments made.
4369	(3)  Number and amount of total-loss claims.
4370	(4)  Amount and percentage of losses covered by reinsurance
4371	or other loss-transfer agreements.
4372	(5)  Amount of losses covered under specified deductibles.
4373	(6)  Claims and payments for specified insured values.
4374	(7)  Claims and payments for specified dollar values.
4375	(8)  Claims and payments for specified types of
4376	construction or mitigation features.
4377	(9)  Claims and payments for policies under specified
4378	underwriting criteria.
4379	(10)  Claims and payments for contents, additional living
4380	expense, and other specified coverages.
4381	(11)  Claims and payments by county for the information
4382	specified in this section.
4383	(12)  Any other data that the office requires.
4384	Section 34.  Effective August 1, 2007, section 627.7277,
4385	Florida Statutes, is amended to read:
4386	627.7277  Notice of renewal premium.--
4387	(1)  As used in this section, the terms "policy" and
4388	"renewal" have the meaning ascribed in s. 627.728.
4389	(2)  An insurer shall mail or deliver to its policyholder
4390	at least 30 days' advance written notice of the renewal premium
4391	for the policy.
4392	(3)  If the insurer fails to provide the 30 days' notice of
4393	a renewal premium that results in a premium increase, the
4394	coverage under the policy remains in effect at the existing
4395	rates until 30 days after the notice is given or until the
4396	effective date of replacement coverage obtained by the insured,
4397	whichever occurs first.
4398	(4)  Every notice of renewal premium must specify:
4399	(a)  The dollar amounts recouped for assessments by the
4400	Florida Hurricane Catastrophe Fund, the Citizens Property
4401	Insurance Corporation, and the Florida Insurance Guaranty
4402	Association. The actual names of the entities must appear next
4403	to the dollar amounts.
4404	(b)  The dollar amount of any premium increase that is due
4405	to a rate increase and the dollar amounts that are due to
4406	coverage changes.
4407	(5)  The Financial Services Commission may adopt rules
4408	pursuant to ss. 120.536(1) and 120.54 to implement this section.
4409	Section 35.  Paragraph (e) of subsection (3) and subsection
4410	(4) of section 631.57, Florida Statutes, are amended to read:
4411	631.57  Powers and duties of the association.--
4412	(3)
4413	(e)1.a.  In addition to assessments otherwise authorized in
4414	paragraph (a) and to the extent necessary to secure the funds
4415	for the account specified in s. 631.55(2)(c) for the direct
4416	payment of covered claims of insolvent homeowners insurers and
4417	to pay the reasonable costs to administer such claims, or to
4418	retire indebtedness, including, without limitation, the
4419	principal, redemption premium, if any, and interest on, and
4420	related costs of issuance of, bonds issued under s. 631.695 and
4421	the funding of any reserves and other payments required under
4422	the bond resolution or trust indenture pursuant to which such
4423	bonds have been issued, the office, upon certification of the
4424	board of directors, shall levy emergency assessments upon
4425	insurers holding a certificate of authority. The emergency
4426	assessments payable under this paragraph by any insurer shall
4427	not exceed in any single year more than 2 percent of that
4428	insurer's direct written premiums, net of refunds, in this state
4429	during the preceding calendar year for the kinds of insurance
4430	within the account specified in s. 631.55(2)(c).
4431	b.  Any emergency assessments authorized under this
4432	paragraph shall be levied by the office upon insurers referred
4433	to in sub-subparagraph a., upon certification as to the need for
4434	such assessments by the board of directors. In the event the
4435	board of directors participates in the issuance of bonds in
4436	accordance with s. 631.695, emergency assessments shall be
4437	levied, in each year that bonds issued under s. 631.695 and
4438	secured by such emergency assessments are outstanding, in such
4439	amounts up to such 2-percent limit as required in order to
4440	provide for the full and timely payment of the principal of,
4441	redemption premium, if any, and interest on, and related costs
4442	of issuance of, such bonds. The emergency assessments provided
4443	for in this paragraph are assigned and pledged to the
4444	municipality, county, or legal entity issuing bonds under s.
4445	631.695 for the benefit of the holders of such bonds, in order
4446	to enable such municipality, county, or legal entity to provide
4447	for the payment of the principal of, redemption premium, if any,
4448	and interest on such bonds, the cost of issuance of such bonds,
4449	and the funding of any reserves and other payments required
4450	under the bond resolution or trust indenture pursuant to which
4451	such bonds have been issued, without the necessity of any
4452	further action by the association, the office, or any other
4453	party. To the extent bonds are issued under s. 631.695 and the
4454	association determines to secure such bonds by a pledge of
4455	revenues received from the emergency assessments, such bonds,
4456	upon such pledge of revenues, shall be secured by and payable
4457	from the proceeds of such emergency assessments, and the
4458	proceeds of emergency assessments levied under this paragraph
4459	shall be remitted directly to and administered by the trustee or
4460	custodian appointed for such bonds.
4461	c.  Emergency assessments under this paragraph may be
4462	payable in a single payment or, at the option of the
4463	association, may be payable in 12 monthly installments with the
4464	first installment being due and payable at the end of the month
4465	after an emergency assessment is levied and subsequent
4466	installments being due not later than the end of each succeeding
4467	month.
4468	d.  If emergency assessments are imposed, the report
4469	required by s. 631.695(7) shall include an analysis of the
4470	revenues generated from the emergency assessments imposed under
4471	this paragraph.
4472	e.  If emergency assessments are imposed, the references in
4473	sub-subparagraph (1)(a)3.b. and s. 631.695(2) and (7) to
4474	assessments levied under paragraph (a) shall include emergency
4475	assessments imposed under this paragraph.
4476	2.  In order to ensure that insurers paying emergency
4477	assessments levied under this paragraph continue to charge rates
4478	that are neither inadequate nor excessive, within 90 days after
4479	being notified of such assessments, each insurer that is to be
4480	assessed pursuant to this paragraph shall submit a rate filing
4481	for coverage included within the account specified in s.
4482	631.55(2)(c) and for which rates are required to be filed under
4483	s. 627.062. If the filing reflects a rate change that, as a
4484	percentage, is equal to the difference between the rate of such
4485	assessment and the rate of the previous year's assessment under
4486	this paragraph, the filing shall consist of a certification so
4487	stating and shall be deemed approved when made. Any rate change
4488	of a different percentage shall be subject to the standards and
4489	procedures of s. 627.062.
4490	3.  In the event the board of directors participates in the
4491	issuance of bonds in accordance with s. 631.695, an annual
4492	assessment under this paragraph shall continue while the bonds
4493	issued with respect to which the assessment was imposed are
4494	outstanding, including any bonds the proceeds of which were used
4495	to refund bonds issued pursuant to s. 631.695, unless adequate
4496	provision has been made for the payment of the bonds in the
4497	documents authorizing the issuance of such bonds.
4498	4.  Emergency assessments under this paragraph are not
4499	premium and are not subject to the premium tax, to any fees, or
4500	to any commissions. An insurer is liable for all emergency
4501	assessments that the insurer collects and shall treat the
4502	failure of an insured to pay an emergency assessment as a
4503	failure to pay the premium. An insurer is not liable for
4504	uncollectible emergency assessments.
4505	(4)  The department may exempt any insurer from any regular
4506	or emergency an assessment if an assessment would result in such
4507	insurer's financial statement reflecting an amount of capital or
4508	surplus less than the sum of the minimum amount required by any
4509	jurisdiction in which the insurer is authorized to transact
4510	insurance.
4511	Section 36.  It is the intent of the Legislature that the
4512	amendments to s. 631.57, Florida Statutes, by s. 34, chapter
4513	2006-12, Laws of Florida, authorized the Florida Insurance
4514	Guaranty Association to certify, and the Office of Insurance
4515	Regulation to levy, an emergency assessment of up to 2 percent
4516	to directly pay the covered claims out of the account specified
4517	in s. 631.55(2)(c), Florida Statutes, or use such emergency
4518	assessment proceeds to retire the indebtedness and costs of
4519	bonds issued to pay such claims and reasonable claims
4520	administration costs.
4521	Section 37.  Subsection (11) of section 718.111, Florida
4522	Statutes, is amended to read:
4523	718.111  The association.--
4524	(11)  INSURANCE.--In order to protect the safety, health,
4525	and welfare of the people of the State of Florida and to ensure
4526	consistency in the provision of insurance coverage to
4527	condominiums and their unit owners, paragraphs (b) and (c) are
4528	deemed to apply to every residential condominium in the state,
4529	regardless of the date of its declaration of condominium. It is
4530	the intent of the Legislature to encourage lower or stable
4531	insurance premiums for associations described in this section.
4532	Therefore, the Legislature requires a report to be prepared by
4533	the Office of Insurance Regulation of the Department of
4534	Financial Services for publication 18 months from the effective
4535	date of this act, evaluating premium increases or decreases for
4536	associations, unit owner premium increases or decreases,
4537	recommended changes to better define common areas, or any other
4538	information the Office of Insurance Regulation deems
4539	appropriate.
4540	(a)  A unit-owner controlled association operating a
4541	residential condominium shall use its best efforts to obtain and
4542	maintain adequate insurance to protect the association, the
4543	association property, the common elements, and the condominium
4544	property required to be insured by the association pursuant to
4545	paragraph (b). If the association is developer controlled, the
4546	association shall exercise due diligence to obtain and maintain
4547	such insurance.  Failure to obtain and maintain adequate
4548	insurance during any period of developer control shall
4549	constitute a breach of fiduciary responsibility by the
4550	developer-appointed members of the board of directors of the
4551	association, unless said members can show that despite such
4552	failure, they have exercised due diligence. The declaration of
4553	condominium as originally recorded, or amended pursuant to
4554	procedures provided therein, may require that condominium
4555	property consisting of freestanding buildings where there is no
4556	more than one building in or on such unit need not be insured by
4557	the association if the declaration requires the unit owner to
4558	obtain adequate insurance for the condominium property. An
4559	association may also obtain and maintain liability insurance for
4560	directors and officers, insurance for the benefit of association
4561	employees, and flood insurance for common elements, association
4562	property, and units. Adequate insurance, regardless of any
4563	requirement in the declaration of condominium for coverage by
4564	the association for "full insurable value," "replacement cost,"
4565	or the like, may include reasonable deductibles as determined by
4566	the board based upon available funds or predetermined assessment
4567	authority at the time that the insurance is obtained.
4568	1.  Windstorm insurance coverage for a group of no fewer
4569	than three communities created and operating under chapter 718,
4570	chapter 719, chapter 720, or chapter 721 may be obtained and
4571	maintained for the communities if the insurance coverage is
4572	sufficient to cover an amount equal to the probable maximum loss
4573	for the communities for a 250-year windstorm event. Such
4574	probable maximum loss must be determined through the use of a
4575	competent model that has been accepted by the Florida Commission
4576	on Hurricane Loss Project Methodology. Such insurance coverage
4577	is deemed adequate windstorm insurance for the purposes of this
4578	section.
4579	2.  An association or group of associations may self-insure
4580	against claims against the association, the association
4581	property, and the condominium property required to be insured by
4582	an association, upon compliance with the applicable provisions
4583	of ss. 624.460-624.488, which shall be considered adequate
4584	insurance for the purposes of this section. A copy of each
4585	policy of insurance in effect shall be made available for
4586	inspection by unit owners at reasonable times.
4587	(b)  Every hazard insurance policy issued or renewed on or
4588	after January 1, 2004, to protect the condominium shall provide
4589	primary coverage for:
4590	1.  All portions of the condominium property located
4591	outside the units;
4592	2.  The condominium property located inside the units as
4593	such property was initially installed, or replacements thereof
4594	of like kind and quality and in accordance with the original
4595	plans and specifications or, if the original plans and
4596	specifications are not available, as they existed at the time
4597	the unit was initially conveyed; and
4598	3.  All portions of the condominium property for which the
4599	declaration of condominium requires coverage by the association.
4600
4601	Anything to the contrary notwithstanding, the terms "condominium
4602	property," "building," "improvements," "insurable improvements,"
4603	"common elements," "association property," or any other term
4604	found in the declaration of condominium which defines the scope
4605	of property or casualty insurance that a condominium association
4606	must obtain shall exclude all floor, wall, and ceiling
4607	coverings, electrical fixtures, appliances, air conditioner or
4608	heating equipment, water heaters, water filters, built-in
4609	cabinets and countertops, and window treatments, including
4610	curtains, drapes, blinds, hardware, and similar window treatment
4611	components, or replacements of any of the foregoing which are
4612	located within the boundaries of a unit and serve only one unit
4613	and all air conditioning compressors that service only an
4614	individual unit, whether or not located within the unit
4615	boundaries. The foregoing is intended to establish the property
4616	or casualty insuring responsibilities of the association and
4617	those of the individual unit owner and do not serve to broaden
4618	or extend the perils of coverage afforded by any insurance
4619	contract provided to the individual unit owner. Beginning
4620	January 1, 2004, the association shall have the authority to
4621	amend the declaration of condominium, without regard to any
4622	requirement for mortgagee approval of amendments affecting
4623	insurance requirements, to conform the declaration of
4624	condominium to the coverage requirements of this section.
4625	(c)  Every hazard insurance policy issued or renewed on or
4626	after January 1, 2004, to an individual unit owner shall provide
4627	that the coverage afforded by such policy is excess over the
4628	amount recoverable under any other policy covering the same
4629	property. Each insurance policy issued to an individual unit
4630	owner providing such coverage shall be without rights of
4631	subrogation against the condominium association that operates
4632	the condominium in which such unit owner's unit is located. All
4633	real or personal property located within the boundaries of the
4634	unit owner's unit which is excluded from the coverage to be
4635	provided by the association as set forth in paragraph (b) shall
4636	be insured by the individual unit owner.
4637	(d)  The association shall obtain and maintain adequate
4638	insurance or fidelity bonding of all persons who control or
4639	disburse funds of the association. The insurance policy or
4640	fidelity bond must cover the maximum funds that will be in the
4641	custody of the association or its management agent at any one
4642	time. As used in this paragraph, the term "persons who control
4643	or disburse funds of the association" includes, but is not
4644	limited to, those individuals authorized to sign checks and the
4645	president, secretary, and treasurer of the association. The
4646	association shall bear the cost of bonding.
4647	Section 38.  Task Force on Citizens Property Insurance
4648	Claims Handling and Resolution.--
4649	(1)  TASK FORCE CREATED.--There is created the Task Force
4650	on Citizens Property Insurance Claims Handling and Resolution.
4651	(2)  ADMINISTRATION.--The task force shall be
4652	administratively housed within the Office of the Chief Financial
4653	Officer but shall operate independently of any state officer or
4654	agency. The Office of the Chief Financial Officer shall provide
4655	such administrative support as the task force deems necessary to
4656	accomplish its mission and shall provide necessary funding for
4657	the task force within its existing resources. The Executive
4658	Office of the Governor, the Department of Financial Services,
4659	and the Office of Insurance Regulation shall provide substantive
4660	staff support for the task force.
4661	(3)  MEMBERSHIP.--The members of the task force shall be
4662	appointed as follows:
4663	(a)  The Governor shall appoint one member who is a
4664	representative of insurance consumers.
4665	(b)  The Chief Financial Officer shall appoint one member
4666	who has expertise in claims handling.
4667	(c)  The President of the Senate shall appoint one member.
4668	(d)  The Speaker of the House of Representatives shall
4669	appoint one member.
4670	(e)  The Commissioner of Insurance Regulation, or his or
4671	her designee, shall serve as an ex officio voting member of the
4672	task force.
4673	(f)  The Insurance Consumer Advocate, or his or her
4674	designee, shall serve as an ex officio voting member of the task
4675	force.
4676	(g)  The Executive Director of Citizens Property Insurance
4677	Corporation, or his or her designee, shall serve as an ex
4678	officio voting member of the task force.
4679
4680	Members of the task force shall serve without compensation but
4681	are entitled to receive reimbursement for per diem and travel
4682	expenses as provided in s. 112.061, Florida Statutes.
4683	(4)  PURPOSE AND INTENT.--The Legislature recognizes that
4684	policyholders and applicants of Citizens Property Insurance
4685	Corporation should receive the highest possible level of service
4686	and treatment. This level should never be less than the private
4687	market. The Legislature further recognizes that Citizens
4688	Property Insurance Corporation's service standards should be no
4689	less than those applied to insurers in the voluntary market with
4690	respect to responsiveness, timeliness, customer courtesy, and
4691	overall dealings with policyholders and applicants. The purpose
4692	of the task force is to make recommendations to the legislative
4693	and executive branches of this state's government relating to
4694	the handling, service, and resolution of claims by Citizens
4695	Property Insurance Corporation that are sufficient to ensure
4696	that all Citizens' policyholders and applicants in this state
4697	are able to obtain appropriate handling, service, and resolution
4698	of claims, as further described in this section.
4699	(5)  SPECIFIC ISSUES.--The task force shall conduct such
4700	research and hearings as it deems necessary to achieve the
4701	purposes specified in subsection (4) and shall develop
4702	information on relevant issues, including, but not limited to,
4703	the following:
4704	(a)  How Citizens Property Insurance Corporation can
4705	improve its customer service.
4706	(b)  How Citizens Property Insurance Corporation can
4707	improve its adjuster response time after a hurricane.
4708	(c)  How Citizens Property Insurance Corporation can
4709	efficiently use its available adjusting sources for claims.
4710	(d)  How Citizens Property Insurance Corporation can
4711	improve the time it takes to conduct damage assessments.
4712	(e)  How Citizens Property Insurance Corporation can
4713	dispose of and settle claims remaining from the 2004 and 2005
4714	hurricane seasons and can improve the time it takes to dispose
4715	of and settle claims remaining from the 2004 and 2005 hurricane
4716	seasons.
4717	(f)  How Citizens Property Insurance Corporation can
4718	improve the time it takes to dispose of and settle claims.
4719	(g)  Whether Citizens Property Insurance Corporation has
4720	hired an adequate level of permanent claims and adjusting staff
4721	in addition to outsourcing its claims-adjusting functions to
4722	independent adjusting firms.
4723	(6)  REPORTS AND RECOMMENDATIONS.--By July 1, 2007, the
4724	task force shall provide a report containing recommendations
4725	regarding the process Citizens Property Insurance Corporation
4726	should use to dispose of the claims remaining open from the 2004
4727	and 2005 hurricane seasons. By July 1, 2008, the task force
4728	shall provide a report containing findings relating to the
4729	issues identified in subsection (5) and recommendations
4730	consistent with the purposes of this section and also consistent
4731	with such findings. The report shall include recommendations
4732	regarding the process Citizens Property Insurance Corporation
4733	should use to dispose of claims. The task force shall submit the
4734	reports to the Governor, the Chief Financial Officer, the
4735	President of the Senate, and the Speaker of the House of
4736	Representatives. The task force may also submit such interim
4737	reports as it deems appropriate.
4738	(7)  ADDITIONAL ACTIVITIES.--The task force shall monitor
4739	the implementation of the provisions of chapter 2006-12, Laws of
4740	Florida, relating to the creation of the Office of Internal
4741	Auditor in Citizens Property Insurance Corporation and shall
4742	make such additional recommendations as it deems appropriate for
4743	further legislative action during the 2006-2008 legislative
4744	biennium.
4745	(8)  EXPIRATION.--The task force shall expire at the end of
4746	the 2006-2008 legislative biennium.
4747	Section 39.  Windstorm Mitigation Study Committee.--
4748	(1)(a)  The Windstorm Mitigation Study Committee is created
4749	and shall be composed of eight members as follows:
4750	1.  Two members shall be appointed by the Governor, with
4751	one designated by the Governor to serve as chair.
4752	2.  Two members shall be appointed by the Chief Financial
4753	Officer.
4754	3.  Two members shall be appointed by the President of the
4755	Senate.
4756	4.  Two members shall be appointed by the Speaker of the
4757	House of Representatives.
4758	(b)  Each member must be knowledgeable of issues concerning
4759	the mitigation of the effects of windstorms on structures in
4760	this state and at least one member must represent primarily the
4761	interests of homeowners.
4762	(2)(a)  The members of the committee shall serve without
4763	compensation, but are entitled to reimbursement for all
4764	necessary expenses incurred in performing their duties,
4765	including travel expenses, in accordance with s. 112.061,
4766	Florida Statutes. Reimbursements for travel shall be paid by the
4767	appointing entity.
4768	(b)  The committee shall meet as necessary, at the call of
4769	the chair, and at the time and place designated by the chair.
4770	The committee may conduct its meetings through teleconferences
4771	or other similar means. The first meeting of the committee shall
4772	occur no later than February 9, 2007.
4773	(3)  The Department of Financial Services, the Office of
4774	Insurance Regulation, the Citizens Property Insurance
4775	Corporation, and other agencies of this state shall supply any
4776	information, assistance, and facilities that are considered
4777	necessary by the committee to carry out its duties under this
4778	section. The department shall provide staff assistance as
4779	necessary in order to carry out the required clerical and
4780	administrative functions of the committee.
4781	(4)  The committee shall analyze those solutions and
4782	programs that address the state's acute need to mitigate the
4783	effects of windstorms on structures, especially residential
4784	property that is located in areas at greatest risk of windstorm
4785	damage, including programs or proposals that provide for:
4786	(a)  The availability of home inspections for windstorm
4787	resistance.
4788	(b)  Grants to assist homeowners, and possibly other groups
4789	of property owners, to harden their property against windstorm
4790	damage.
4791	(c)  The full actuarial value to be reflected in premium
4792	credits for windstorm mitigation.
4793	(d)  The most effective way to inform policyholders of the
4794	availability of and means by which to obtain premium credits for
4795	windstorm mitigation.
4796	(e)  Coordination among federal, local, and private
4797	initiatives.
4798	(f)  Streamlining or strengthening applicable state,
4799	regional, and local regulations.
4800	(g)  The stimulation of public and private efforts to
4801	mitigate against windstorm injury and damage.
4802	(h)  The discovery and assessment of funding sources for
4803	windstorm mitigation.
4804	(i)  Tax incentives for windstorm mitigation.
4805	(j)  Consumer information concerning the benefits of
4806	windstorm mitigation, including personal safety as well as
4807	property security.
4808	(k)  Research on windstorm mitigation.
4809
4810	The committee may develop any other solutions and programs that
4811	it considers appropriate.
4812	(5)  In performing its analysis, the committee shall
4813	consider both the safety of the residents of this state and the
4814	protection of real property, especially residential. In
4815	addition, the committee shall consider both short-term and long-
4816	term solutions and programs.
4817	(6)  The committee shall review, evaluate, and make
4818	recommendations regarding existing and proposed programs and
4819	initiatives for mitigating windstorm damage.
4820	(7)  The committee shall provide recommendations, including
4821	proposed legislation, to the Governor, the President of the
4822	Senate, the Speaker of the House of Representatives, the Chief
4823	Financial Officer, and the Commissioner of Insurance Regulation
4824	by March 6, 2007.
4825	(8)  The committee shall expire on May 15, 2007.
4826	Section 40.  The Financial Services Commission shall adopt
4827	a uniform home grading scale to grade the ability of a home to
4828	withstand the wind load from a sustained severe tropical storm
4829	or hurricane. The commission shall coordinate with the Office of
4830	Insurance Regulation, the Department of Financial Services, and
4831	the Department of Community Affairs in developing the grading
4832	scale, which must be based upon and consistent with the rating
4833	system required by chapter 2006-12, Laws of Florida. The
4834	commission shall adopt the uniform grading scale by rule no
4835	later than June 30, 2007.
4836	Section 41.  Florida Disaster Recovery Program.--
4837	(1)  The Department of Community Affairs shall implement
4838	the 2006 Disaster Recovery Program from funds provided through
4839	the Emergency Supplemental Appropriations Act for Defense, the
4840	Global War on Terror, and Hurricane Recovery, 2006, for the
4841	purpose of assisting local governments in satisfying disaster-
4842	recovery needs in the areas of low-income housing and
4843	infrastructure, with a primary focus on the hardening of single-
4844	family and multifamily housing units, not only to ensure that
4845	affordable housing can withstand the effects of hurricane-force
4846	winds, but also to mitigate the increasing costs of insurance,
4847	which may ultimately render existing affordable homes
4848	unaffordable or uninsurable. This section does not create an
4849	entitlement for local governments or property owners or obligate
4850	the state in any way to fund disaster-recovery needs.
4851	(2)  Entitlement and nonentitlement counties identified
4852	under the Federal Disaster Declaration (FEMA-1609-DR), federally
4853	recognized Indian tribes, and nonprofit organizations are
4854	eligible to apply for funding.
4855	(3)  Up to 78 percent of these funds may be used to
4856	complement the grants awarded by the Department of Financial
4857	Services under s. 215.5586, Florida Statutes, and fund other
4858	eligible disaster-related activities supporting housing
4859	rehabilitation, hardening, mitigation, and infrastructure
4860	improvements at the request of the local governments in order to
4861	assist the State of Florida in better serving low-income
4862	homeowners in single-family housing units, including, but not
4863	limited to, condominiums. Up to 20 percent of the funds may be
4864	used to provide inspections and mitigation improvements to
4865	multifamily units receiving rental assistance under projects of
4866	the United States Department of Housing and Urban Development or
4867	the Rural Development Division of the United States Department
4868	of Agriculture.
4869	(4)  For the 2006-2007 fiscal year, the sum of $100,066,518
4870	is appropriated in a Grant in Aid - Fixed Capital Outlay
4871	appropriation category from the Florida Small Cities Community
4872	Development Block Grant Program Fund to the Department of
4873	Community Affairs for the purpose of implementing the provisions
4874	of this section. These funds shall be used in a manner
4875	consistent with Federal Register, Vol. 71, No. 209, Docket No.
4876	FR-5089-N-01, and the State of Florida Action Plan for Disaster
4877	Recovery as approved by the United States Department of Housing
4878	and Urban Development.
4879	Section 42.  Effective January 1, 2008, no insurer writing
4880	private passenger automobile insurance in this state may
4881	continue to write such insurance if the insurer writes
4882	homeowners' insurance in another state but not in this state
4883	unless the insurer writing private passenger automobile
4884	insurance in this state is affiliated with an insurer writing
4885	homeowners' insurance in this state.
4886	Section 43.  It is the intent of the Legislature to create
4887	during the 2007 Legislative Session a grant program to assist
4888	persons whose income does not exceed that of "low-income
4889	persons" as defined in s. 420.602(8), Florida Statutes, for the
4890	purpose of purchasing property insurance to protect their
4891	homestead property.
4892	Section 44.  Effective July 1, 2007, subsection (6) of
4893	section 627.0629, Florida Statutes, is repealed.
4894	Section 45.  For the 2006-2007 fiscal year, there is
4895	appropriated $2 million from the Department of Financial
4896	Services' Insurance Regulatory Trust Fund to the Department of
4897	Financial Services for the purposes of implementing section 40
4898	of this act.
4899	Section 46.  Effective February 1, 2007, the sum of
4900	$105,000 is appropriated from the Insurance Regulatory Trust
4901	Fund and 193,000 in associated rate is provided to the Office of
4902	Insurance Regulation for the purpose of granting competitive pay
4903	adjustments for actuaries employed within the office.
4904	Adjustments shall be provided at the discretion of the
4905	Commissioner of Insurance Regulation.
4906	Section 47.  If any provision of this act or its
4907	application to any person or circumstance is held invalid, the
4908	invalidity does not affect other provisions or applications of
4909	the act which can be given effect without the invalid provision
4910	or application, and to this end the provisions of this act are
4911	severable.
4912	Section 48.  Except as otherwise expressly provided in this
4913	act, this act shall take effect upon becoming a law.

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