Florida Senate - 2008 SENATOR AMENDMENT

Bill No. CS/CS/HB 679, 1st Eng.

195742

CHAMBER ACTION

Senate

Floor: 1c/AD/2R

5/2/2008 2:50 PM

.

.

.

.

.

House



1

Senator Posey moved the following amendment to amendment

2

(074374):

3

4

     Senate Amendment (with title amendment)

5

     Between line(s) 1292 and 1293

6

insert:

7

8

     Section 12. (1) Notwithstanding any other provisions of

9

law, any three or more condominium associations may form a

10

self-insurance fund for the purposes of pooling and spreading

11

the liabilities of its participant associations arising from the

12

deductible provisions of the commercial lines residential

13

property insurance policies of the participants applicable to

14

hurricane losses, if:

15

     (a) Such fund is a not-for-profit corporation pursuant to

16

chapter 617, Florida Statutes.

17

     (b) The fund is implemented through contracts among the

18

participating associations, or through contracts between the

19

participating associations and another legal entity established

20

for and limited to establishing and implementing the program.

21

     (c) The liability of the fund for claims is limited to

22

funds available for the payment of claims.

23

     (d) The contract provided to a participating

24

association clearly discloses the obligations of the

25

participants in the fund and the obligations of the fund,

26

including the limited liability of the fund as defined in

27

paragraph (c). The contract must specify a reasonable date

28

for the payment of claims which provides the fund with

29

adequate time to verify and account for all claims for a

30

given year so that claims payments can be properly

31

calculated after consideration of the funds available.

32

Before execution of the contract, the association or its

33

representative must be provided a separate disclosure form

34

specifying the limited liability of the fund and all

35

administrative fees and estimated expenses, and provide

36

examples of the manner in which available funds will be

37

allocated among claimants if claims exceed the funds

38

available for the payment thereof. Such disclosure must be

39

signed by a representative of the participating association

40

before or at the time of execution of the contract.

41

     (e) The contributions charged for participating in the

42

fund are established by the fund and calculated as a percentage

43

of the participant's hurricane deductible dollar amount. The

44

fund may determine the method and timing of payment of

45

contributions.

46

     (f) All members of the governing board of the fund must

47

be participating associations in the fund and the governing

48

body shall have all powers necessary to establish and

49

administer the fund as authorized by the participants in the

50

fund. All decisions of the fund shall be based upon a vote of

51

the majority of the board. The board may contract with

52

individual professionals to administer the fund.

53

     (g) The fund uses and contracts with knowledgeable

54

persons or business entities to administer and service the fund,

55

including marketing, policy, contract administration, claims

56

administration, accounting services, and legal services.

57

     (h) The fund uses a properly licensed general lines

58

insurance agent who is a Florida resident for solicitation

59

of participation in the fund and does not prevent,

60

impede, or restrict any applicant or participant in

61

the fund from maintaining or selecting an agent of

62

choice. The fund may not favor one or more agents over

63

another agent. The organizational documents, the contract

64

and notices of disclosure must be filed with the Office of

65

Insurance Regulation not less than 45 days prior to

66

solicitation by the fund.

67

     (i) The fund is audited by an independent auditor no less

68

frequently than every 2 years.

69

     (2) The fund may accumulate funds or periodically

70

distribute excess funds to its participants on a pro rata

71

basis, reflecting loss experience of individual participants

72

and proportionate contributions paid by participants.

73

     (3) Participants in the fund must have a deductible

74

no greater than as provided in s. 627.701(8), Florida

75

Statutes. Self-insurance funds or pools established

76

pursuant to this section are not subject to licensure

77

requirements or regulation pursuant to the Florida

78

Insurance Code except for part IX of chapter 626,

79

Florida Statutes, which may be enforced by the

80

Office of Insurance Regulation or the Department of

81

Financial Services, as applicable, and are not

82

subject to any fees, taxes, or assessments related to

83

the writing or transaction of insurance in this state.

84

85

================ T I T L E  A M E N D M E N T ================

86

And the title is amended as follows:

87

     On line(s) 1354, after the semicolon,

88

insert:

89

90

providing that any three or more condominium

91

associations may form a self-insurance fund for

92

certain purposes under certain conditions; requiring

93

that the contract for participating in the fund

94

disclose certain information and contain certain

95

provisions; requiring that a disclosure be provided

96

to an association before execution of such contract;

97

requiring that such disclosure contain certain

98

information; providing for the charging of

99

contributions for participation in the fund;

100

requiring that the majority of the governing board of

101

the fund be participants in the fund; providing

102

powers of the governing board; authorizing the

103

fund to enter into certain contracts; requiring that

104

the fund use a general lines agent meeting certain

105

criteria when soliciting participation in the fund;

106

prohibiting the fund from taking certain actions

107

when selecting such agent; requiring that the

108

fund be independently audited at specified

109

intervals; authorizing the fund to accumulate funds

110

or distribute excess funds to participants on a pro

111

rata basis; providing for a deductible for

112

participants in the fund; exempting such self-

113

insurance funds from certain requirements, regulations,

114

fees, taxes, and assessments;

5/1/2008  10:45:00 AM     24-09402-08

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