CS/CS/CS/HB 1495

1	A bill to be entitled
2	An act relating to property and casualty insurance;
3	amending s. 215.47, F.S.; authorizing the State Board of
4	Administration to invest in certain revenue bonds under
5	certain circumstances; amending s. 215.555, F.S., relating
6	to the Florida Hurricane Catastrophe Fund; revising the
7	dates of an insurer's contract year for purposes of
8	calculating the insurer's retention; revising
9	reimbursement contract coverage payment provisions;
10	extending application of provisions relating to
11	reimbursement contracts; revising the dates on which the
12	State Board of Administration is required to publish a
13	statement of the estimated borrowing capacity of the
14	Florida Hurricane Catastrophe Fund; requiring the board to
15	publish a statement of the estimated claims-paying
16	capacity of the Florida Hurricane Catastrophe Fund;
17	requiring a reimbursement premium formula to provide cash
18	build-up factors for certain contract years; extending
19	provisions relating to temporary increase in coverage
20	limit operations for the fund; providing additional
21	reimbursement requirements for temporary increase in
22	coverage addenda for additional contract years; expanding
23	the powers and duties of the board; specifying required
24	increases in TICL reimbursement premiums for certain
25	contract years; specifying nonapplication of cash build-up
26	factors to TICL reimbursement premiums; deleting authority
27	for the State Board of Administration to increase the
28	claims-paying capacity of the fund; amending s. 215.5586,
29	F.S., relating to the My Safe Florida Home Program;
30	revising legislative intent; revising criteria for
31	hurricane mitigation inspections; revising criteria for
32	eligibility for a mitigation grant; expanding the list of
33	improvements for which grants may be used; deleting
34	provisions relating to no-interest loans; requiring that
35	contracts valued at or greater than a specified amount be
36	subject to review and approval by the Legislative Budget
37	Commission; requiring the Department of Financial Services
38	to implement a condominium weatherization and mitigation
39	loan program for certain purposes; specifying program
40	requirements; specifying an administration requirement for
41	the program; requiring the department to adopt rules;
42	amending s. 624.4622, F.S.; prohibiting withdrawal notice
43	requirements of longer than 30 days for members of a local
44	government self-insurance fund; requiring local government
45	self-insurance funds to submit an affidavit to specified
46	entities; specifying affidavit contents; amending s.
47	624.605, F.S.; revising the definition of the term
48	"casualty insurance" to include certain debt cancellation
49	products sold by certain business entities; amending s.
50	627.062, F.S.; extending application of file and use
51	filing requirements for certain property insurance
52	filings; prohibiting the Office of Insurance Regulation
53	from interfering with an insurer's right to solicit, sell,
54	promote, or otherwise acquire policyholders and implement
55	coverage; specifying limited application to certain rates;
56	specifying that certain rate filings are not subject to
57	office determination as excessive or unfairly
58	discriminatory; providing limitations; providing a
59	definition; prohibiting certain rate filings under certain
60	circumstances; preserving the office's authority to
61	disapprove certain rate filings under certain
62	circumstances; providing procedures for insurers
63	submitting certain rate filings; specifying nonapplication
64	to certain types of insurance; amending s. 627.0621, F.S.;
65	deleting a limitation on the application of the attorney-
66	client privilege and work product doctrine in challenges
67	to actions by the office relating to rate filings;
68	amending s. 627.0628, F.S.; requiring the Florida
69	Commission on Hurricane Loss Projection Methodology to
70	hold public meetings for purposes of implementing certain
71	windstorm mitigation discounts, credits, other rate
72	differentials, and deductible reductions; requiring a
73	report to the Governor, Cabinet, and Legislature; amending
74	s. 627.0629, F.S.; requiring certain hurricane mitigation
75	measure discounts, credits, and rate differentials to
76	supersede certain other discounts, credits, and rate
77	differentials; authorizing residential property insurers
78	to include reinsurance costs without certain TICL
79	adjustments; amending s. 627.0655, F.S.; discontinuing
80	authorization for a premium discount for a policyholder
81	having multiple policies from Citizens Property Insurance
82	Corporation or a policy that has been removed from the
83	corporation by another insurer; amending s. 627.351, F.S.;
84	deleting application of certain personal lines residential
85	property insurance requirements for wind-borne debris
86	regions insured by the corporation; revising the basis of
87	a surcharge to offset an account deficit; providing for
88	members of the board of governors of the corporation to
89	serve staggered terms; providing exceptions to actuarially
90	sound rate requirements for the corporation; providing
91	legislative findings; requiring the corporation to
92	implement certain actuarially sound rates for certain
93	lines of business; providing limitations; providing for
94	cessation of certain rate increases upon implementation of
95	actuarially sound rates; requiring the corporation to
96	transfer certain funds from the rate increase to the
97	Insurance Regulatory Trust Fund in the Department of
98	Financial Services for a certain time; deleting certain
99	wind-only coverage maximum loss reporting requirements;
100	amending s. 627.711, F.S.; revising eligible entities
101	authorized to certify uniform mitigation inspection forms;
102	authorizing insurers to contract with inspection firms to
103	review certain verification forms and reinspect properties
104	for certain purposes; providing for such contracts to be
105	at the insurer's expense; providing a criminal penalty for
106	knowingly submitting a false or fraudulent mitigation form
107	with the intent to receive an undeserved discount;
108	amending s. 627.712, F.S.; providing an additional
109	exception to residential property insurance windstorm
110	coverage requirements for certain risks; expanding a
111	requirement that insurers notify mortgageholders or
112	lienholders of policyholder elections for coverage not
113	covering wind; amending s. 631.65, F.S.; providing
114	construction relating to certain prohibited advertisements
115	or solicitations; requiring the My Safe Florida Home
116	Program to use certain funds for certain mitigation
117	grants; authorizing the department to establish a separate
118	account in the trust fund for accounting purposes;
119	providing an effective date.
120
121	Be It Enacted by the Legislature of the State of Florida:
122
123	Section 1.  Subsection (20) is added to section 215.47,
124	Florida Statutes, to read:
125	215.47  Investments; authorized securities; loan of
126	securities.--Subject to the limitations and conditions of the
127	State Constitution or of the trust agreement relating to a trust
128	fund, moneys available for investments under ss. 215.44-215.53
129	may be invested as follows:
130	(20)  The State Board of Administration may, consistent
131	with sound investment policy, invest in revenue bonds issued
132	pursuant to s. 215.555(6).
133	Section 2.  Paragraph (e) of subsection (2), paragraphs (b)
134	and (c) of subsection (4), paragraph (b) of subsection (5), and
135	subsection (17) of section 215.555, Florida Statutes, are
136	amended, and paragraph (f) is added to subsection (7) of that
137	section, to read:
138	215.555  Florida Hurricane Catastrophe Fund.--
139	(2)  DEFINITIONS.--As used in this section:
140	(e)  "Retention" means the amount of losses below which an
141	insurer is not entitled to reimbursement from the fund. An
142	insurer's retention shall be calculated as follows:
143	1.  The board shall calculate and report to each insurer
144	the retention multiples for that year. For the contract year
145	beginning June 1, 2005, the retention multiple shall be equal to
146	$4.5 billion divided by the total estimated reimbursement
147	premium for the contract year; for subsequent years, the
148	retention multiple shall be equal to $4.5 billion, adjusted
149	based upon the reported exposure from the prior contract year to
150	reflect the percentage growth in exposure to the fund for
151	covered policies since 2004, divided by the total estimated
152	reimbursement premium for the contract year. Total reimbursement
153	premium for purposes of the calculation under this subparagraph
154	shall be estimated using the assumption that all insurers have
155	selected the 90-percent coverage level. In 2010, the contract
156	year begins June 1 and ends December 31. In 2011 and thereafter,
157	the contract year begins January 1 and ends December 31.
158	2.  The retention multiple as determined under subparagraph
159	1. shall be adjusted to reflect the coverage level elected by
160	the insurer. For insurers electing the 90-percent coverage
161	level, the adjusted retention multiple is 100 percent of the
162	amount determined under subparagraph 1. For insurers electing
163	the 75-percent coverage level, the retention multiple is 120
164	percent of the amount determined under subparagraph 1. For
165	insurers electing the 45-percent coverage level, the adjusted
166	retention multiple is 200 percent of the amount determined under
167	subparagraph 1.
168	3.  An insurer shall determine its provisional retention by
169	multiplying its provisional reimbursement premium by the
170	applicable adjusted retention multiple and shall determine its
171	actual retention by multiplying its actual reimbursement premium
172	by the applicable adjusted retention multiple.
173	4.  For insurers who experience multiple covered events
174	causing loss during the contract year, beginning June 1, 2005,
175	each insurer's full retention shall be applied to each of the
176	covered events causing the two largest losses for that insurer.
177	For each other covered event resulting in losses, the insurer's
178	retention shall be reduced to one-third of the full retention.
179	The reimbursement contract shall provide for the reimbursement
180	of losses for each covered event based on the full retention
181	with adjustments made to reflect the reduced retentions after
182	January 1 of the contract year provided the insurer reports its
183	losses as specified in the reimbursement contract.
184	(4)  REIMBURSEMENT CONTRACTS.--
185	(b)1.  The contract shall contain a promise by the board to
186	reimburse the insurer for 45 percent, 75 percent, or 90 percent
187	of its losses from each covered event in excess of the insurer's
188	retention, plus 5 percent of the reimbursed losses to cover loss
189	adjustment expenses.
190	2.  The insurer must elect one of the percentage coverage
191	levels specified in this paragraph and may, upon renewal of a
192	reimbursement contract, elect a lower percentage coverage level
193	if no revenue bonds issued under subsection (6) after a covered
194	event are outstanding, or elect a higher percentage coverage
195	level, regardless of whether or not revenue bonds are
196	outstanding. All members of an insurer group must elect the same
197	percentage coverage level. Any joint underwriting association,
198	risk apportionment plan, or other entity created under s.
199	627.351 must elect the 90-percent coverage level.
200	3.  The contract shall provide that reimbursement amounts
201	shall not be reduced by reinsurance paid or payable to the
202	insurer from other sources.
203	4.  Notwithstanding any other provision contained in this
204	section, the board shall make available to insurers that
205	purchased coverage provided by this subparagraph in 2008 2007,
206	insurers qualifying as limited apportionment companies under s.
207	627.351(6)(c), and insurers that have been approved to
208	participate in the Insurance Capital Build-Up Incentive Program
209	pursuant to s. 215.5595 a contract or contract addendum that
210	provides an additional amount of reimbursement coverage of up to
211	$10 million. The premium to be charged for this additional
212	reimbursement coverage shall be 50 percent of the additional
213	reimbursement coverage provided, which shall include one prepaid
214	reinstatement. The minimum retention level that an eligible
215	participating insurer must retain associated with this
216	additional coverage layer is 30 percent of the insurer's surplus
217	as of December 31, 2008, for the 2009-2010 contract year; as of
218	December 31, 2009, for the contract year beginning June 1, 2010,
219	and ending December 31, 2010; and as of December 31, 2010, for
220	the 2011 contract year 2007. This coverage shall be in addition
221	to all other coverage that may be provided under this section.
222	The coverage provided by the fund under this subparagraph shall
223	be in addition to the claims-paying capacity as defined in
224	subparagraph (c)1., but only with respect to those insurers that
225	select the additional coverage option and meet the requirements
226	of this subparagraph. The claims-paying capacity with respect to
227	all other participating insurers and limited apportionment
228	companies that do not select the additional coverage option
229	shall be limited to their reimbursement premium's proportionate
230	share of the actual claims-paying capacity otherwise defined in
231	subparagraph (c)1. and as provided for under the terms of the
232	reimbursement contract. The optional coverage retention as
233	specified shall be accessed before the mandatory coverage under
234	the reimbursement contract, but once the limit of coverage
235	selected under this option is exhausted, the insurer's retention
236	under the mandatory coverage shall apply. This coverage shall
237	apply and be paid concurrently with the mandatory coverage.
238	Coverage provided in the reimbursement contract shall not be
239	affected by the additional premiums paid by participating
240	insurers exercising the additional coverage option allowed in
241	this subparagraph. This subparagraph expires on December May 31,
242	2011 2009.
243	(c)1.  The contract shall also provide that the obligation
244	of the board with respect to all contracts covering a particular
245	contract year shall not exceed the actual claims-paying capacity
246	of the fund up to a limit of $15 billion for that contract year
247	adjusted based upon the reported exposure from the prior
248	contract year to reflect the percentage growth in exposure to
249	the fund for covered policies since 2003, provided the dollar
250	growth in the limit may not increase in any year by an amount
251	greater than the dollar growth of the balance of the fund as of
252	December 31, less any premiums or interest attributable to
253	optional coverage, as defined by rule which occurred over the
254	prior calendar year.
255	2.  In May before the start of the upcoming contract year
256	and in October of during the contract year, the board shall
257	publish in the Florida Administrative Weekly a statement of the
258	fund's estimated borrowing capacity, the fund's estimated
259	claims-paying capacity, and the projected balance of the fund as
260	of December 31. After the end of each calendar year, the board
261	shall notify insurers of the estimated borrowing capacity, the
262	estimated claims-paying capacity, and the balance of the fund as
263	of December 31 to provide insurers with data necessary to assist
264	them in determining their retention and projected payout from
265	the fund for loss reimbursement purposes. In conjunction with
266	the development of the premium formula, as provided for in
267	subsection (5), the board shall publish factors or multiples
268	that assist insurers in determining their retention and
269	projected payout for the next contract year. For all regulatory
270	and reinsurance purposes, an insurer may calculate its projected
271	payout from the fund as its share of the total fund premium for
272	the current contract year multiplied by the sum of the projected
273	balance of the fund as of December 31 and the estimated
274	borrowing capacity for that contract year as reported under this
275	subparagraph.
276	(5)  REIMBURSEMENT PREMIUMS.--
277	(b)  The State Board of Administration shall select an
278	independent consultant to develop a formula for determining the
279	actuarially indicated premium to be paid to the fund. The
280	formula shall specify, for each zip code or other limited
281	geographical area, the amount of premium to be paid by an
282	insurer for each $1,000 of insured value under covered policies
283	in that zip code or other area. In establishing premiums, the
284	board shall consider the coverage elected under paragraph (4)(b)
285	and any factors that tend to enhance the actuarial
286	sophistication of ratemaking for the fund, including
287	deductibles, type of construction, type of coverage provided,
288	relative concentration of risks, and other such factors deemed
289	by the board to be appropriate. The formula must provide for a
290	cash build-up factor. For the contract year 2009-2010, the
291	factor is 5 percent; for the contract year beginning June 1,
292	2010, and ending December 31, 2010, the factor is 10 percent;
293	for the 2011 contract year, the factor is 15 percent; for the
294	2012 contract year, the factor is 20 percent; and for the 2013
295	contract year and thereafter, the factor is 25 percent. The
296	formula may provide for a procedure to determine the premiums to
297	be paid by new insurers that begin writing covered policies
298	after the beginning of a contract year, taking into
299	consideration when the insurer starts writing covered policies,
300	the potential exposure of the insurer, the potential exposure of
301	the fund, the administrative costs to the insurer and to the
302	fund, and any other factors deemed appropriate by the board. The
303	formula must be approved by unanimous vote of the board. The
304	board may, at any time, revise the formula pursuant to the
305	procedure provided in this paragraph.
306	(7)  ADDITIONAL POWERS AND DUTIES.--
307	(f)  The board may require insurers to notarize documents
308	submitted to the board.
309	(17)  TEMPORARY INCREASE IN COVERAGE LIMIT OPTIONS.--
310	(a)  Findings and intent.--
311	1.  The Legislature finds that:
312	a.  Because of temporary disruptions in the market for
313	catastrophic reinsurance, many property insurers were unable to
314	procure sufficient amounts of reinsurance for the 2006 hurricane
315	season or were able to procure such reinsurance only by
316	incurring substantially higher costs than in prior years.
317	b.  The reinsurance market problems were responsible, at
318	least in part, for substantial premium increases to many
319	consumers and increases in the number of policies issued by
320	Citizens Property Insurance Corporation.
321	c.  It is likely that the reinsurance market disruptions
322	will not significantly abate prior to the 2007 hurricane season.
323	2.  It is the intent of the Legislature to create options
324	for insurers to purchase a temporary increased coverage limit
325	above the statutorily determined limit in subparagraph (4)(c)1.,
326	applicable for the 2007, 2008, and 2009, 2010, 2011, 2012, and
327	2013 hurricane seasons, to address market disruptions and enable
328	insurers, at their option, to procure additional coverage from
329	the Florida Hurricane Catastrophe Fund.
330	(b)  Applicability of other provisions of this
331	section.--All provisions of this section and the rules adopted
332	under this section apply to the coverage created by this
333	subsection unless specifically superseded by provisions in this
334	subsection.
335	(c)  Optional coverage.--For the contract year commencing
336	June 1, 2007, and ending May 31, 2008, the contract year
337	commencing June 1, 2008, and ending May 31, 2009, and the
338	contract year commencing June 1, 2009, and ending May 31, 2010,
339	the contract year commencing June 1, 2010, and ending December
340	31, 2010, the contract year commencing January 1, 2011, and
341	ending December 31, 2011, the contract year commencing January
342	1, 2012, and ending December 31, 2012, and the contract year
343	commencing January 1, 2013, and ending December 31, 2013, the
344	board shall offer, for each of such years, the optional coverage
345	as provided in this subsection.
346	(d)  Additional definitions.--As used in this subsection,
347	the term:
348	1.  "FHCF" means Florida Hurricane Catastrophe Fund.
349	2.  "FHCF reimbursement premium" means the premium paid by
350	an insurer for its coverage as a mandatory participant in the
351	FHCF, but does not include additional premiums for optional
352	coverages.
353	3.  "Payout multiple" means the number or multiple created
354	by dividing the statutorily defined claims-paying capacity as
355	determined in subparagraph (4)(c)1. by the aggregate
356	reimbursement premiums paid by all insurers estimated or
357	projected as of calendar year-end.
358	4.  "TICL" means the temporary increase in coverage limit.
359	5.  "TICL options" means the temporary increase in coverage
360	options created under this subsection.
361	6.  "TICL insurer" means an insurer that has opted to
362	obtain coverage under the TICL options addendum in addition to
363	the coverage provided to the insurer under its FHCF
364	reimbursement contract, but does not include Citizens Property
365	Insurance Corporation.
366	7.  "TICL reimbursement premium" means the premium charged
367	by the fund for coverage provided under the TICL option.
368	8.  "TICL coverage multiple" means the coverage multiple
369	when multiplied by an insurer's reimbursement premium that
370	defines the temporary increase in coverage limit.
371	9.  "TICL coverage" means the coverage for an insurer's
372	losses above the insurer's statutorily determined claims-paying
373	capacity based on the claims-paying limit in subparagraph
374	(4)(c)1., which an insurer selects as its temporary increase in
375	coverage from the fund under the TICL options selected. A TICL
376	insurer's increased coverage limit options shall be calculated
377	as follows:
378	a.  The board shall calculate and report to each TICL
379	insurer the TICL coverage multiples based on 12 options for
380	increasing the insurer's FHCF coverage limit. Each TICL coverage
381	multiple shall be calculated by dividing $1 billion, $2 billion,
382	$3 billion, $4 billion, $5 billion, $6 billion, $7 billion, $8
383	billion, $9 billion, $10 billion, $11 billion, or $12 billion by
384	the total estimated aggregate FHCF reimbursement premiums for
385	the 2007-2008 contract year and, the 2008-2009 contract year,
386	and the 2009-2010 contract year.
387	b.  For the 2009-2010 contract year, the board shall
388	calculate and report to each TICL insurer the TICL coverage
389	multiples based on 10 options for increasing the insurer's FHCF
390	coverage limit. Each TICL coverage multiple shall be calculated
391	by dividing $1 billion, $2 billion, $3 billion, $4 billion, $5
392	billion, $6 billion, $7 billion, $8 billion, $9 billion, and $10
393	billion by the total estimated aggregate FHCF reimbursement
394	premiums for the 2009-2010 contract year.
395	c.  For the contract year beginning June 1, 2010, and
396	ending December 31, 2010, the board shall calculate and report
397	to each TICL insurer the TICL coverage multiples based on eight
398	options for increasing the insurer's FHCF coverage limit. Each
399	TICL coverage multiple shall be calculated by dividing $1
400	billion, $2 billion, $3 billion, $4 billion, $5 billion, $6
401	billion, $7 billion, and $8 billion by the total estimated
402	aggregate FHCF reimbursement premiums for the contract year.
403	d.  For the 2011 contract year, the board shall calculate
404	and report to each TICL insurer the TICL coverage multiples
405	based on six options for increasing the insurer's FHCF coverage
406	limit. Each TICL coverage multiple shall be calculated by
407	dividing $1 billion, $2 billion, $3 billion, $4 billion, $5
408	billion, and $6 billion by the total estimated aggregate FHCF
409	reimbursement premiums for the 2011 contract year.
410	e.  For the 2012 contract year, the board shall calculate
411	and report to each TICL insurer the TICL coverage multiples
412	based on four options for increasing the insurer's FHCF coverage
413	limit. Each TICL coverage multiple shall be calculated by
414	dividing $1 billion, $2 billion, $3 billion, and $4 billion by
415	the total estimated aggregate FHCF reimbursement premiums for
416	the 2012 contract year.
417	f.  For the 2013 contract year, the board shall calculate
418	and report to each TICL insurer the TICL coverage multiples
419	based on two options for increasing the insurer's FHCF coverage
420	limit. Each TICL coverage multiple shall be calculated by
421	dividing $1 billion and $2 billion by the total estimated
422	aggregate FHCF reimbursement premiums for the 2013 contract
423	year.
424	g.b.  The TICL insurer's increased coverage shall be the
425	FHCF reimbursement premium multiplied by the TICL coverage
426	multiple. In order to determine an insurer's total limit of
427	coverage, an insurer shall add its TICL coverage multiple to its
428	payout multiple. The total shall represent a number that, when
429	multiplied by an insurer's FHCF reimbursement premium for a
430	given reimbursement contract year, defines an insurer's total
431	limit of FHCF reimbursement coverage for that reimbursement
432	contract year.
433	10.  "TICL options addendum" means an addendum to the
434	reimbursement contract reflecting the obligations of the fund
435	and insurers selecting an option to increase an insurer's FHCF
436	coverage limit.
437	(e)  TICL options addendum.--
438	1.  The TICL options addendum shall provide for
439	reimbursement of TICL insurers for covered events occurring
440	between June 1, 2007, and May 31, 2008, and between June 1,
441	2008, and May 31, 2009, or between June 1, 2009, and May 31,
442	2010, between June 1, 2010, and December 31, 2010, between
443	January 1, 2011, and December 31, 2011, between January 1, 2012,
444	and December 31, 2012, or between January 1, 2013, and December
445	31, 2013, in exchange for the TICL reimbursement premium paid
446	into the fund under paragraph (f). Any insurer writing covered
447	policies has the option of selecting an increased limit of
448	coverage under the TICL options addendum and shall select such
449	coverage at the time that it executes the FHCF reimbursement
450	contract.
451	2.a.  The TICL addendum for the contract year commencing
452	June 1, 2007, and ending May 31, 2008, or the contract year
453	commencing June 1, 2008, and ending May 31, 2009, shall contain
454	a promise by the board to reimburse the TICL insurer for 45
455	percent, 75 percent, or 90 percent of its losses from each
456	covered event in excess of the insurer's retention, plus 5
457	percent of the reimbursed losses to cover loss adjustment
458	expenses. The percentage shall be the same as the coverage level
459	selected by the insurer under paragraph (4)(b).
460	b.  The TICL addendum for the contract year commencing June
461	1, 2009, and ending May 31, 2010, shall contain a promise by the
462	board to reimburse the TICL insurer for 45 percent or 75 percent
463	of its losses from each covered event in excess of the insurer's
464	retention, plus 5 percent of the reimbursed losses to cover loss
465	adjustment expenses.
466	c.  The TICL addendum for the contract year commencing June
467	1, 2010, and ending December 31, 2010, shall contain a promise
468	by the board to reimburse the TICL insurer for 45 percent or 65
469	percent of its losses from each covered event in excess of the
470	insurer's retention, plus 5 percent of the reimbursed losses to
471	cover loss adjustment expenses.
472	d.  The TICL addendum for the contract year commencing
473	January 1, 2011, and ending December 31, 2011, shall contain a
474	promise by the board to reimburse the TICL insurer for 45
475	percent or 55 percent of its losses from each covered event in
476	excess of the insurer's retention, plus 5 percent of the
477	reimbursed losses to cover loss adjustment expenses.
478	e.  The TICL addendum for the contract year commencing
479	January 1, 2012, and ending December 31, 2012, shall contain a
480	promise by the board to reimburse the TICL insurer for 45
481	percent of its losses from each covered event in excess of the
482	insurer's retention, plus 5 percent of the reimbursed losses to
483	cover loss adjustment expenses.
484	f.  The TICL addendum for the contract year commencing
485	January 1, 2013, and ending December 31, 2013, shall contain a
486	promise by the board to reimburse the TICL insurer for 30
487	percent of its losses from each covered event in excess of the
488	insurer's retention, plus 5 percent of the reimbursed losses to
489	cover loss adjustment expenses.
490	3.  The TICL addendum shall provide that reimbursement
491	amounts shall not be reduced by reinsurance paid or payable to
492	the insurer from other sources.
493	4.  The priorities, schedule, and method of reimbursements
494	under the TICL addendum shall be the same as provided under
495	subsection (4).
496	(f)  TICL reimbursement premiums.--Each TICL insurer shall
497	pay to the fund, in the manner and at the time provided in the
498	reimbursement contract for payment of reimbursement premiums, a
499	TICL reimbursement premium determined as specified in subsection
500	(5), except that a cash build-up factor does not apply to the
501	TICL reimbursement premiums. However, the TICL reimbursement
502	premium shall be increased in contract year 2009-2010 by a
503	factor of two, in the contract year beginning June 1, 2010, and
504	ending December 31, 2010, by a factor of three, in the 2011
505	contract year by a factor of four, in the 2012 contract year by
506	a factor of five, and in the 2013 contract year by a factor of
507	six.
508	(g)  Effect on claims-paying capacity of the fund.--For the
509	contract terms commencing June 1, 2007, June 1, 2008, and June
510	1, 2009, June 1, 2010, January 1, 2011, January 1, 2012, and
511	January 1, 2013, the program created by this subsection shall
512	increase the claims-paying capacity of the fund as provided in
513	subparagraph (4)(c)1. by an amount not to exceed $12 billion and
514	shall depend on the TICL coverage options selected and the
515	number of insurers that select the TICL optional coverage. The
516	additional capacity shall apply only to the additional coverage
517	provided under the TICL options and shall not otherwise affect
518	any insurer's reimbursement from the fund if the insurer chooses
519	not to select the temporary option to increase its limit of
520	coverage under the FHCF.
521	(h)  Increasing the claims-paying capacity of the
522	fund.--For the contract years commencing June 1, 2007, June 1,
523	2008, and June 1, 2009, the board may increase the claims-paying
524	capacity of the fund as provided in paragraph (g) by an amount
525	not to exceed $4 billion in four $1 billion options and shall
526	depend on the TICL coverage options selected and the number of
527	insurers that select the TICL optional coverage. Each insurer's
528	TICL premium shall be calculated based upon the additional limit
529	of increased coverage that the insurer selects. Such limit is
530	determined by multiplying the TICL multiple associated with one
531	of the four options times the insurer's FHCF reimbursement
532	premium. The reimbursement premium associated with the
533	additional coverage provided in this paragraph shall be
534	determined as specified in subsection (5).
535	Section 3.  Section 215.5586, Florida Statutes, as amended
536	by section 1 of chapter 2009-10, Laws of Florida, is amended to
537	read:
538	215.5586  My Safe Florida Home Program.--There is
539	established within the Department of Financial Services the My
540	Safe Florida Home Program. The department shall provide fiscal
541	accountability, contract management, and strategic leadership
542	for the program, consistent with this section. This section does
543	not create an entitlement for property owners or obligate the
544	state in any way to fund the inspection or retrofitting of
545	residential property in this state. Implementation of this
546	program is subject to annual legislative appropriations. It is
547	the intent of the Legislature that the My Safe Florida Home
548	Program provide trained and certified inspectors to perform
549	inspections for owners of for at least 400,000 site-built,
550	single-family, residential properties and provide grants to
551	eligible at least 35,000 applicants as funding allows before
552	June 30, 2009. The program shall develop and implement a
553	comprehensive and coordinated approach for hurricane damage
554	mitigation that may shall include the following:
555	(1)  HURRICANE MITIGATION INSPECTIONS.--
556	(a)  Certified inspectors to provide free home-retrofit
557	inspections of site-built, single-family, residential property
558	may shall be offered throughout the state to determine what
559	mitigation measures are needed, what insurance premium discounts
560	may be available, and what improvements to existing residential
561	properties are needed to reduce the property's vulnerability to
562	hurricane damage. The Department of Financial Services shall
563	contract with wind certification entities to provide free
564	hurricane mitigation inspections. The inspections provided to
565	homeowners, at a minimum, must include:
566	1.  A home inspection and report that summarizes the
567	results and identifies recommended improvements a homeowner may
568	take to mitigate hurricane damage.
569	2.  A range of cost estimates regarding the recommended
570	mitigation improvements.
571	3.  Insurer-specific information regarding premium
572	discounts correlated to the current mitigation features and the
573	recommended mitigation improvements identified by the
574	inspection.
575	4.  A hurricane resistance rating scale specifying the
576	home's current as well as projected wind resistance
577	capabilities. As soon as practical, the rating scale must be the
578	uniform home grading scale adopted by the Financial Services
579	Commission pursuant to s. 215.55865.
580	(b)  To qualify for selection by the department as a wind
581	certification entity to provide hurricane mitigation
582	inspections, the entity shall, at a minimum, meet the following
583	requirements:
584	1.  Use hurricane mitigation inspectors who:
585	a.  Are certified as a building inspector under s. 468.607;
586	b.  Are licensed as a general or residential contractor
587	under s. 489.111;
588	c.  Are licensed as a professional engineer under s.
589	471.015 and who have passed the appropriate equivalency test of
590	the Building Code Training Program as required by s. 553.841;
591	d.  Are licensed as a professional architect under s.
592	481.213; or
593	e.  Have at least 2 years of experience in residential
594	construction or residential building inspection and have
595	received specialized training in hurricane mitigation
596	procedures. Such training may be provided by a class offered
597	online or in person.
598	2.  Use hurricane mitigation inspectors who also:
599	a.  Have undergone drug testing and level 2 background
600	checks pursuant to s. 435.04. The department may conduct
601	criminal record checks of inspectors used by wind certification
602	entities. Inspectors must submit a set of the fingerprints to
603	the department for state and national criminal history checks
604	and must pay the fingerprint processing fee set forth in s.
605	624.501. The fingerprints shall be sent by the department to the
606	Department of Law Enforcement and forwarded to the Federal
607	Bureau of Investigation for processing. The results shall be
608	returned to the department for screening. The fingerprints shall
609	be taken by a law enforcement agency, designated examination
610	center, or other department-approved entity; and
611	b.  Have been certified, in a manner satisfactory to the
612	department, to conduct the inspections.
613	3.  Provide a quality assurance program including a
614	reinspection component.
615	(c)  The department shall implement a quality assurance
616	program that includes a statistically valid number of
617	reinspections.
618	(d)  An application for an inspection must contain a signed
619	or electronically verified statement made under penalty of
620	perjury that the applicant has submitted only a single
621	application for that home.
622	(e)  The owner of a site-built, single-family, residential
623	property may apply for and receive an inspection without also
624	applying for a grant pursuant to subsection (2) and without
625	meeting the requirements of paragraph (2)(a).
626	(2)  MITIGATION GRANTS.--Financial grants shall be used to
627	encourage single-family, site-built, owner-occupied, residential
628	property owners to retrofit their properties to make them less
629	vulnerable to hurricane damage.
630	(a)  For a homeowner to be eligible for a grant, the
631	following criteria for persons who have obtained a completed
632	inspection after May 1, 2007, a residential property must be
633	met:
634	1.  The homeowner must have been granted a homestead
635	exemption on the home under chapter 196.
636	2.  The home must be a dwelling with an insured value of
637	$300,000 or less. Homeowners who are low-income persons, as
638	defined in s. 420.0004(10), are exempt from this requirement.
639	3.  The home must have undergone an acceptable hurricane
640	mitigation inspection after May 1, 2007.
641	4.  The home must be located in the "wind-borne debris
642	region" as that term is defined in s. 1609.2, International
643	Building Code (2006), or as subsequently amended.
644	5.  Be a home for which The building permit application for
645	initial construction of the home must have been was made before
646	March 1, 2002.
647
648	An application for a grant must contain a signed or
649	electronically verified statement made under penalty of perjury
650	that the applicant has submitted only a single application and
651	must have attached documents demonstrating the applicant meets
652	the requirements of this paragraph.
653	(b)  All grants must be matched on a dollar-for-dollar
654	basis up to for a total of $10,000 for the actual cost of the
655	mitigation project with the state's contribution not to exceed
656	$5,000.
657	(c)  The program shall create a process in which
658	contractors agree to participate and homeowners select from a
659	list of participating contractors. All mitigation must be based
660	upon the securing of all required local permits and inspections
661	and must be performed by properly licensed contractors.
662	Mitigation projects are subject to random reinspection of up to
663	at least 5 percent of all projects. Hurricane mitigation
664	inspectors qualifying for the program may also participate as
665	mitigation contractors as long as the inspectors meet the
666	department's qualifications and certification requirements for
667	mitigation contractors.
668	(d)  Matching fund grants shall also be made available to
669	local governments and nonprofit entities for projects that will
670	reduce hurricane damage to single-family, site-built, owner-
671	occupied, residential property. The department shall liberally
672	construe those requirements in favor of availing the state of
673	the opportunity to leverage funding for the My Safe Florida Home
674	Program with other sources of funding.
675	(e)  When recommended by a hurricane mitigation inspection,
676	grants may be used for the following improvements only:
677	1.  Opening protection.
678	2.  Exterior doors, including garage doors.
679	3.  Brace gable ends.
680	4.  Reinforcing roof-to-wall connections.
681	5.  Improving the strength of roof-deck attachments.
682	6.  Upgrading roof covering from code to code plus.
683	7.  Secondary water barrier for roof.
684
685	The department may require that improvements be made to all
686	openings, including exterior doors and garage doors, as a
687	condition of reimbursing a homeowner approved for a grant.
688	(f)  Grants may be used on a previously inspected existing
689	structure or on a rebuild. A rebuild is defined as a site-built,
690	single-family dwelling under construction to replace a home that
691	was destroyed or significantly damaged by a hurricane and deemed
692	unlivable by a regulatory authority. The homeowner must be a
693	low-income homeowner as defined in paragraph (g), must have had
694	a homestead exemption for that home prior to the hurricane, and
695	must be intending to rebuild the home as that homeowner's
696	homestead.
697	(g)  Low-income homeowners, as defined in s. 420.0004(10),
698	who otherwise meet the requirements of paragraphs (a), (c), (e),
699	and (f) are eligible for a grant of up to $5,000 and are not
700	required to provide a matching amount to receive the grant.
701	Additionally, for low-income homeowners, grant funding may be
702	used for repair to existing structures leading to any of the
703	mitigation improvements provided in paragraph (e), limited to 20
704	percent of the grant value. The program may accept a
705	certification directly from a low-income homeowner that the
706	homeowner meets the requirements of s. 420.0004(10) if the
707	homeowner provides such certification in a signed or
708	electronically verified statement made under penalty of perjury.
709	(h)  The department shall establish objective, reasonable
710	criteria for prioritizing grant applications, consistent with
711	the requirements of this section.
712	(i)  The department shall develop a process that ensures
713	the most efficient means to collect and verify grant
714	applications to determine eligibility and may direct hurricane
715	mitigation inspectors to collect and verify grant application
716	information or use the Internet or other electronic means to
717	collect information and determine eligibility.
718	(3)  EDUCATION AND CONSUMER AWARENESS.--The department may
719	undertake a statewide multimedia public outreach and advertising
720	campaign to inform consumers of the availability and benefits of
721	hurricane inspections and of the safety and financial benefits
722	of residential hurricane damage mitigation. The department may
723	seek out and use local, state, federal, and private funds to
724	support the campaign.
725	(4)  ADVISORY COUNCIL.--There is created an advisory
726	council to provide advice and assistance to the department
727	regarding administration of the program. The advisory council
728	shall consist of:
729	(a)  A representative of lending institutions, selected by
730	the Financial Services Commission from a list of at least three
731	persons recommended by the Florida Bankers Association.
732	(b)  A representative of residential property insurers,
733	selected by the Financial Services Commission from a list of at
734	least three persons recommended by the Florida Insurance
735	Council.
736	(c)  A representative of home builders, selected by the
737	Financial Services Commission from a list of at least three
738	persons recommended by the Florida Home Builders Association.
739	(d)  A faculty member of a state university, selected by
740	the Financial Services Commission, who is an expert in
741	hurricane-resistant construction methodologies and materials.
742	(e)  Two members of the House of Representatives, selected
743	by the Speaker of the House of Representatives.
744	(f)  Two members of the Senate, selected by the President
745	of the Senate.
746	(g)  The Chief Executive Officer of the Federal Alliance
747	for Safe Homes, Inc., or his or her designee.
748	(h)  The senior officer of the Florida Hurricane
749	Catastrophe Fund.
750	(i)  The executive director of Citizens Property Insurance
751	Corporation.
752	(j)  The director of the Division of Emergency Management
753	of the Department of Community Affairs.
754
755	Members appointed under paragraphs (a)-(d) shall serve at the
756	pleasure of the Financial Services Commission. Members appointed
757	under paragraphs (e) and (f) shall serve at the pleasure of the
758	appointing officer. All other members shall serve as voting ex
759	officio members. Members of the advisory council shall serve
760	without compensation but may receive reimbursement as provided
761	in s. 112.061 for per diem and travel expenses incurred in the
762	performance of their official duties.
763	(5)  FUNDING.--The department may seek out and leverage
764	local, state, federal, or private funds to enhance the financial
765	resources of the program.
766	(6)  RULES.--The Department of Financial Services shall
767	adopt rules pursuant to ss. 120.536(1) and 120.54 to govern the
768	program; implement the provisions of this section; including
769	rules governing hurricane mitigation inspections and grants,
770	mitigation contractors, and training of inspectors and
771	contractors; and carry out the duties of the department under
772	this section.
773	(7)  HURRICANE MITIGATION INSPECTOR LIST.--The department
774	shall develop and maintain as a public record a current list of
775	hurricane mitigation inspectors authorized to conduct hurricane
776	mitigation inspections pursuant to this section.
777	(8)  NO-INTEREST LOANS.--The department shall implement a
778	no-interest loan program by October 1, 2008, contingent upon the
779	selection of a qualified vendor and execution of a contract
780	acceptable to the department and the vendor. The department
781	shall enter into partnerships with the private sector to provide
782	loans to owners of site-built, single-family, residential
783	property to pay for mitigation measures listed in subsection
784	(2). A loan eligible for interest payments pursuant to this
785	subsection may be for a term of up to 3 years and cover up to
786	$5,000 in mitigation measures. The department shall pay the
787	creditor the market rate of interest using funds appropriated
788	for the My Safe Florida Home Program. In no case shall the
789	department pay more than the interest rate set by s. 687.03. To
790	be eligible for a loan, a loan applicant must first obtain a
791	home inspection and report that specifies what improvements are
792	needed to reduce the property's vulnerability to windstorm
793	damage pursuant to this section and meet loan underwriting
794	requirements set by the lender. The department may adopt rules
795	pursuant to ss. 120.536(1) and 120.54 to implement this
796	subsection which may include eligibility criteria.
797	(8)(9)  PUBLIC OUTREACH FOR CONTRACTORS AND REAL ESTATE
798	BROKERS AND SALES ASSOCIATES.--The program shall develop
799	brochures for distribution to general contractors, roofing
800	contractors, and real estate brokers and sales associates
801	licensed under part I of chapter 475 explaining the benefits to
802	homeowners of residential hurricane damage mitigation. The
803	program shall encourage contractors to distribute the brochures
804	to homeowners at the first meeting with a homeowner who is
805	considering contracting for home or roof repairs or contracting
806	for the construction of a new home. The program shall encourage
807	real estate brokers and sales associates licensed under part I
808	of chapter 475 to distribute the brochures to clients prior to
809	the purchase of a home. The brochures may be made available
810	electronically.
811	(9)(10)  CONTRACT MANAGEMENT.--The department may contract
812	with third parties for grants management, inspection services,
813	contractor services for low-income homeowners, information
814	technology, educational outreach, and auditing services. Such
815	contracts shall be considered direct costs of the program and
816	shall not be subject to administrative cost limits, but
817	contracts valued at $1 million $500,000 or more shall be subject
818	to review and approval by the Legislative Budget Commission. The
819	department shall contract with providers that have a
820	demonstrated record of successful business operations in areas
821	directly related to the services to be provided and shall ensure
822	the highest accountability for use of state funds, consistent
823	with this section.
824	(10)(11)  INTENT.--It is the intent of the Legislature that
825	grants made to residential property owners under this section
826	shall be considered disaster-relief assistance within the
827	meaning of s. 139 of the Internal Revenue Code of 1986, as
828	amended.
829	(11)(12)  REPORTS.--The department shall make an annual
830	report on the activities of the program that shall account for
831	the use of state funds and indicate the number of inspections
832	requested, the number of inspections performed, the number of
833	grant applications received, and the number and value of grants
834	approved. The report shall be delivered to the President of the
835	Senate and the Speaker of the House of Representatives by
836	February 1 of each year.
837	(12)  CONDOMINIUM WEATHERIZATION AND MITIGATION LOAN
838	PROGRAM.--
839	(a)  Subject to a specific appropriation by the Legislature
840	from funds received pursuant to the American Recovery and
841	Reinvestment Act of 2009, Pub. L. No. 111-5, specifically for
842	the purpose of condominium weatherization, the department shall
843	implement a condominium weatherization and mitigation loan
844	program to assist condominium unit owners in weatherizing their
845	condominium units and mitigating all such units against wind
846	damage. The program shall have the following minimum
847	requirements:
848	1.  The department shall contract with lenders to offer
849	weatherization and hurricane mitigation loan subsidies equal to
850	a competitive rate of interest on a loan balance of up to $5,000
851	per condominium unit for 3 years. The interest subsidy may be
852	paid in advance by the department to a lender participating in
853	the program.
854	2.  The loans must be used to purchase or install
855	weatherization measures and hurricane mitigation measures
856	identified in paragraph (2)(e) that comply with the requirements
857	of part A, Title IV of the Energy Conservation and Production
858	Act, 42 U.S.C. ss. 6861 et seq., as amended by the American
859	Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, as
860	determined by the department.
861	3.  A participating condominium association must agree to
862	purchase and install weatherization and mitigation measures for
863	each unit in the condominium that lacks the weatherization and
864	mitigation measures.
865	4.  To be eligible, a condominium must have been permitted
866	for construction on or before March 1, 2002, be located in the
867	wind-borne debris region.
868	5.  Condominiums of more than 200 units are not eligible
869	for the loan program.
870	6.  The department may contract with third parties for
871	auditing and related services to ensure accountability and
872	program quality.
873	(b)  The loan program shall be administered on a first-
874	come, first-served basis.
875	(c)  The department shall adopt rules pursuant to ss.
876	120.536(1) and 120.54 to implement the loan program.
877	Section 4.  Subsections (5) and (6) are added to section
878	624.4622, Florida Statutes, to read:
879	624.4622  Local government self-insurance funds.--
880	(5)  A local government self-insurance fund may not require
881	its members to provide more than 30 days' notice of the member's
882	intention to withdraw from the self-insurance fund as a
883	prerequisite for withdrawing from the self-insurance fund.
884	(6)(a)  Each local government self-insurance fund shall
885	submit annually to the office, to the governing body of each
886	member participant, and to the governing board of each new
887	member before the inception of the policy an affidavit stating
888	whether an officer or owner of or the manager or administrator
889	of a local government self-insurance fund has ever:
890	1.  Been charged with, or indicted for, any criminal
891	offense other than a motor vehicle offense;
892	2.  Pled guilty or nolo contendere to, or been convicted
893	of, any criminal offense other than a motor vehicle offense;
894	3.  Had adjudication of guilt withheld, had a sentence
895	imposed or suspended, had a pronouncement of a sentence
896	suspended, or been pardoned, fined, or placed on probation for
897	any criminal offense other than a motor vehicle offense; or
898	4  Been, within the last 10 years, found liable in any
899	civil action involving dishonesty or a breach of trust.
900	(b)  If the record has been sealed or expunged and the
901	respondent has personally verified that the record was sealed or
902	expunged, a respondent may respond "no" to the question.
903	Section 5.  Paragraph (r) of subsection (1) of section
904	624.605, Florida Statutes, is amended to read:
905	624.605  "Casualty insurance" defined.--
906	(1)  "Casualty insurance" includes:
907	(r)  Insurance for debt cancellation products.--Insurance
908	that a creditor may purchase against the risk of financial loss
909	from the use of debt cancellation products with consumer loans
910	or leases or retail installment contracts. Insurance for debt
911	cancellation products is not liability insurance but shall be
912	considered credit insurance only for the purposes of s.
913	631.52(4).
914	1.  For purposes of this paragraph, the term "debt
915	cancellation products" means loan, lease, or retail installment
916	contract terms, or modifications to loan, lease, or retail
917	installment contracts, under which a creditor agrees to cancel
918	or suspend all or part of a customer's obligation to make
919	payments upon the occurrence of specified events and includes,
920	but is not limited to, debt cancellation contracts, debt
921	suspension agreements, and guaranteed asset protection
922	contracts. However, the term "debt cancellation products" does
923	not include title insurance as defined in s. 624.608.
924	2.  Debt cancellation products may be offered by financial
925	institutions, as defined in s. 655.005(1)(h), insured depository
926	institutions, as defined in 12 U.S.C. s. 1813(c), and
927	subsidiaries of such institutions, as provided in the financial
928	institutions codes, or by other business entities selling a
929	product that may be goods, services, or real property and
930	interests in real property, the sale of which product is
931	regulated by an agency of the state and when the extension of
932	credit is offered in connection with the purchase of such
933	product. as may be specifically authorized by law, and Such debt
934	cancellation products shall not constitute insurance for
935	purposes of the Florida Insurance Code.
936	Section 6.  Paragraphs (a) and (i) of subsection (2) of
937	section 627.062, Florida Statutes, are amended, and paragraph
938	(k) is added to that subsection, to read:
939	627.062  Rate standards.--
940	(2)  As to all such classes of insurance:
941	(a)  Insurers or rating organizations shall establish and
942	use rates, rating schedules, or rating manuals to allow the
943	insurer a reasonable rate of return on such classes of insurance
944	written in this state. A copy of rates, rating schedules, rating
945	manuals, premium credits or discount schedules, and surcharge
946	schedules, and changes thereto, shall be filed with the office
947	under one of the following procedures except as provided in
948	subparagraph 3.:
949	1.  If the filing is made at least 90 days before the
950	proposed effective date and the filing is not implemented during
951	the office's review of the filing and any proceeding and
952	judicial review, then such filing shall be considered a "file
953	and use" filing. In such case, the office shall finalize its
954	review by issuance of a notice of intent to approve or a notice
955	of intent to disapprove within 90 days after receipt of the
956	filing. The notice of intent to approve and the notice of intent
957	to disapprove constitute agency action for purposes of the
958	Administrative Procedure Act. Requests for supporting
959	information, requests for mathematical or mechanical
960	corrections, or notification to the insurer by the office of its
961	preliminary findings shall not toll the 90-day period during any
962	such proceedings and subsequent judicial review. The rate shall
963	be deemed approved if the office does not issue a notice of
964	intent to approve or a notice of intent to disapprove within 90
965	days after receipt of the filing.
966	2.  If the filing is not made in accordance with the
967	provisions of subparagraph 1., such filing shall be made as soon
968	as practicable, but no later than 30 days after the effective
969	date, and shall be considered a "use and file" filing. An
970	insurer making a "use and file" filing is potentially subject to
971	an order by the office to return to policyholders portions of
972	rates found to be excessive, as provided in paragraph (h).
973	3.  For all property insurance filings made or submitted
974	after January 25, 2007, but before December 31, 2010 2009, an
975	insurer seeking a rate that is greater than the rate most
976	recently approved by the office shall make a "file and use"
977	filing. For purposes of this subparagraph, motor vehicle
978	collision and comprehensive coverages are not considered to be
979	property coverages.
980	(i)1.  Except as otherwise specifically provided in this
981	chapter, the office shall not prohibit any insurer, including
982	any residual market plan or joint underwriting association, from
983	paying acquisition costs based on the full amount of premium, as
984	defined in s. 627.403, applicable to any policy, or prohibit any
985	such insurer from including the full amount of acquisition costs
986	in a rate filing.
987	2.  Unless specifically authorized by law, the office shall
988	not interfere, directly or indirectly, with an insurer's right
989	to solicit, sell, promote, or otherwise acquire policyholders
990	and implement coverage using its own lawful methodologies,
991	systems, agents, and approaches, including the calculation,
992	manner, or amount of agent commissions, if any. This
993	subparagraph applies only to rate filings made pursuant to this
994	section.
995	(k)  Effective January 1, 2010, notwithstanding any other
996	provision of this section:
997	1.  With respect to any residential property insurance
998	subject to regulation under this section, a rate filing,
999	including, but not limited to, any rate changes, rating factors,
1000	territories, classifications, discounts, and credits, with
1001	respect to any policy form, including endorsements issued with
1002	the form, that results in an overall average statewide premium
1003	increase or decrease of no more than 10 percent above or below
1004	the premium that would result from the insurer's rates then in
1005	effect shall not be subject to a determination by the office
1006	that the rate is excessive or unfairly discriminatory, except as
1007	provided in subparagraph 3. or any other provision of law,
1008	provided all changes specified in the filing do not result in an
1009	overall premium increase of more than 15 percent for any one
1010	territory for reasons related solely to the rate change. As used
1011	in this subparagraph, the term "insurer's rates then in effect"
1012	includes only rates that have been lawfully in effect under this
1013	section or rates that have been determined to be lawful through
1014	administrative proceedings or judicial proceedings.
1015	2.  An insurer may not make filings under this paragraph
1016	with respect to any policy form, including endorsements issued
1017	with the form, if the overall premium changes resulting from
1018	such filings exceed the amounts specified in this paragraph in
1019	any 12-month period. An insurer may proceed under other
1020	provisions of this section or other provisions of the laws of
1021	this state if the insurer seeks to exceed the premium or rate
1022	limitations of this paragraph.
1023	3.  This paragraph does not affect the authority of the
1024	office to disapprove a rate as inadequate or to disapprove a
1025	filing for the unlawful use of unfairly discriminatory rating
1026	factors that are prohibited by the laws of this state. An
1027	insurer electing to implement a rate change under this paragraph
1028	shall submit a filing to the office at least 30 days prior to
1029	the effective date of the rate change. The office shall have 30
1030	days after the filing's submission to review the filing and
1031	determine if the rate is inadequate or uses unfairly
1032	discriminatory rating factors. Absent a finding by the office
1033	within such 30-day period that the rate is inadequate or that
1034	the insurer has used unfairly discriminatory rating factors, the
1035	filing is deemed approved. If the insurer is implementing an
1036	overall rate decrease and the office finds during the 30-day
1037	period that the filing will result in inadequate premiums or
1038	otherwise endanger the insurer's solvency, the office shall
1039	suspend the rate decrease. If the insurer is implementing an
1040	overall rate increase the results of which continue to produce
1041	an inadequate rate, such increase shall proceed pending
1042	additional action by the office to ensure the adequacy of the
1043	rate.
1044	4.  This paragraph does not apply to rate filings for any
1045	insurance other than residential property insurance.
1046
1047	The provisions of this subsection shall not apply to workers'
1048	compensation and employer's liability insurance and to motor
1049	vehicle insurance.
1050	Section 7.  Section 627.0621, Florida Statutes, as amended
1051	by section 82 of chapter 2009-21, Laws of Florida, is amended to
1052	read:
1053	627.0621  Transparency in rate regulation.--
1054	(1)  DEFINITIONS.--As used in this section, the term:
1055	(a)  "Rate filing" means any original or amended rate
1056	residential property insurance filing.
1057	(b)  "Recommendation" means any proposed, preliminary, or
1058	final recommendation from an office actuary reviewing a rate
1059	filing with respect to the issue of approval or disapproval of
1060	the rate filing or with respect to rate indications that the
1061	office would consider acceptable.
1062	(2)  WEBSITE FOR PUBLIC ACCESS TO RATE FILING
1063	INFORMATION.--With respect to any rate filing made on or after
1064	July 1, 2008, the office shall provide the following information
1065	on a publicly accessible Internet website:
1066	(a)  The overall rate change requested by the insurer.
1067	(b)  All assumptions made by the office's actuaries.
1068	(c)  A statement describing any assumptions or methods that
1069	deviate from the actuarial standards of practice of the Casualty
1070	Actuarial Society or the American Academy of Actuaries,
1071	including an explanation of the nature, rationale, and effect of
1072	the deviation.
1073	(d)  All recommendations made by any office actuary who
1074	reviewed the rate filing.
1075	(e)  Certification by the office's actuary that, based on
1076	the actuary's knowledge, his or her recommendations are
1077	consistent with accepted actuarial principles.
1078	(f)  The overall rate change approved by the office.
1079	(3)  ATTORNEY-CLIENT PRIVILEGE; WORK PRODUCT.--It is the
1080	intent of the Legislature that the principles of the public
1081	records and open meetings laws apply to the assertion of
1082	attorney-client privilege and work product confidentiality by
1083	the office in connection with a challenge to its actions on a
1084	rate filing. Therefore, in any administrative or judicial
1085	proceeding relating to a rate filing, attorney-client privilege
1086	and work product exemptions from disclosure do not apply to
1087	communications with office attorneys or records prepared by or
1088	at the direction of an office attorney, except when the
1089	conditions of paragraphs (a) and (b) have been met:
1090	(a)  The communication or record reflects a mental
1091	impression, conclusion, litigation strategy, or legal theory of
1092	the attorney or office that was prepared exclusively for civil
1093	or criminal litigation or adversarial administrative
1094	proceedings.
1095	(b)  The communication occurred or the record was prepared
1096	after the initiation of an action in a court of competent
1097	jurisdiction, after the issuance of a notice of intent to deny a
1098	rate filing, or after the filing of a request for a proceeding
1099	under ss. 120.569 and 120.57.
1100	Section 8.  Subsection (4) is added to section 627.0628,
1101	Florida Statutes, to read:
1102	627.0628  Florida Commission on Hurricane Loss Projection
1103	Methodology; public records exemption; public meetings
1104	exemption.--
1105	(4)  REVIEW OF DISCOUNTS, CREDITS, OTHER RATE
1106	DIFFERENTIALS, AND REDUCTIONS IN DEDUCTIBLES RELATING TO
1107	WINDSTORM MITIGATION.--The commission shall hold public meetings
1108	for the purpose of receiving testimony and data regarding the
1109	implementation of windstorm mitigation discounts, credits, other
1110	rate differentials, and appropriate reductions in deductibles
1111	pursuant to s. 627.0629. After reviewing the testimony and data
1112	as well as any other information the commission deems
1113	appropriate, the commission shall present a report by October 1,
1114	2009, to the Governor, the Cabinet, the President of the Senate,
1115	and the Speaker of the House of Representatives, including
1116	recommendations on improving the process of assessing,
1117	determining, and applying windstorm mitigation discounts,
1118	credits, other rate differentials, and appropriate reductions in
1119	deductibles pursuant to s. 627.0629.
1120	Section 9.  Paragraph (b) of subsection (1) and subsection
1121	(5) of section 627.0629, Florida Statutes, are amended to read:
1122	627.0629  Residential property insurance; rate filings.--
1123	(1)
1124	(b)  By February 1, 2011, the Office of Insurance
1125	Regulation, in consultation with the Department of Financial
1126	Services and the Department of Community Affairs, shall develop
1127	and make publicly available a proposed method for insurers to
1128	establish discounts, credits, or other rate differentials for
1129	hurricane mitigation measures which directly correlate to the
1130	numerical rating assigned to a structure pursuant to the uniform
1131	home grading scale adopted by the Financial Services Commission
1132	pursuant to s. 215.55865, including any proposed changes to the
1133	uniform home grading scale. By October 1, 2011, the commission
1134	shall adopt rules requiring insurers to make rate filings for
1135	residential property insurance which revise insurers' discounts,
1136	credits, or other rate differentials for hurricane mitigation
1137	measures so that such rate differentials correlate directly to
1138	the uniform home grading scale. The rules may include such
1139	changes to the uniform home grading scale as the commission
1140	determines are necessary, and may specify the minimum required
1141	discounts, credits, or other rate differentials. Such rate
1142	differentials must be consistent with generally accepted
1143	actuarial principles and wind-loss mitigation studies. The rules
1144	shall allow a period of at least 2 years after the effective
1145	date of the revised mitigation discounts, credits, or other rate
1146	differentials for a property owner to obtain an inspection or
1147	otherwise qualify for the revised credit, during which time the
1148	insurer shall continue to apply the mitigation credit that was
1149	applied immediately prior to the effective date of the revised
1150	credit. Discounts, credits, and other rate differentials
1151	established for rate filings under this paragraph shall
1152	supersede, after adoption, the discounts, credits, and other
1153	rate differentials included in rate filings under paragraph (a).
1154	(5)  In order to provide an appropriate transition period,
1155	an insurer may, in its sole discretion, implement an approved
1156	rate filing for residential property insurance over a period of
1157	years. An insurer electing to phase in its rate filing must
1158	provide an informational notice to the office setting out its
1159	schedule for implementation of the phased-in rate filing. An
1160	insurer may include in its rate the actual cost of reinsurance
1161	without the addition of an expense or profit load for the
1162	insurer that duplicates coverage of the temporary increase in
1163	coverage limit (TICL) available from the Florida Hurricane
1164	Catastrophe Fund, even if the insurer does not purchase the TICL
1165	coverage, to the extent the total annual base rate increase does
1166	not exceed 10 percent as a result of such inclusion.
1167	Section 10.  Section 627.0655, Florida Statutes, is amended
1168	to read:
1169	627.0655  Policyholder loss or expense-related premium
1170	discounts.--An insurer or person authorized to engage in the
1171	business of insurance in this state may include, in the premium
1172	charged an insured for any policy, contract, or certificate of
1173	insurance, a discount based on the fact that another policy,
1174	contract, or certificate of any type has been purchased by the
1175	insured from the same insurer or insurer group, or, for policies
1176	issued or renewed before January 1, 2010, from the Citizens
1177	Property Insurance Corporation created under s. 627.351(6) if
1178	the same insurance agent is servicing both policies, or for
1179	policies issued or renewed before January 1, 2010, from an
1180	insurer that has removed the policy from the Citizens Property
1181	Insurance Corporation if the same insurance agent is servicing
1182	both policies.
1183	Section 11.  Paragraphs (y) through (ee) of subsection (6)
1184	of section 627.351, Florida Statutes, are redesignated as
1185	paragraphs (x) through (dd), respectively, and paragraphs (a),
1186	(b), (c), and (m) and present paragraph (x) of that subsection
1187	are amended to read:
1188	627.351  Insurance risk apportionment plans.--
1189	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
1190	(a)1.  It is the public purpose of this subsection to
1191	ensure the existence of an orderly market for property insurance
1192	for Floridians and Florida businesses. The Legislature finds
1193	that private insurers are unwilling or unable to provide
1194	affordable property insurance coverage in this state to the
1195	extent sought and needed. The absence of affordable property
1196	insurance threatens the public health, safety, and welfare and
1197	likewise threatens the economic health of the state. The state
1198	therefore has a compelling public interest and a public purpose
1199	to assist in assuring that property in the state is insured and
1200	that it is insured at affordable rates so as to facilitate the
1201	remediation, reconstruction, and replacement of damaged or
1202	destroyed property in order to reduce or avoid the negative
1203	effects otherwise resulting to the public health, safety, and
1204	welfare, to the economy of the state, and to the revenues of the
1205	state and local governments which are needed to provide for the
1206	public welfare. It is necessary, therefore, to provide
1207	affordable property insurance to applicants who are in good
1208	faith entitled to procure insurance through the voluntary market
1209	but are unable to do so. The Legislature intends by this
1210	subsection that affordable property insurance be provided and
1211	that it continue to be provided, as long as necessary, through
1212	Citizens Property Insurance Corporation, a government entity
1213	that is an integral part of the state, and that is not a private
1214	insurance company. To that end, Citizens Property Insurance
1215	Corporation shall strive to increase the availability of
1216	affordable property insurance in this state, while achieving
1217	efficiencies and economies, and while providing service to
1218	policyholders, applicants, and agents which is no less than the
1219	quality generally provided in the voluntary market, for the
1220	achievement of the foregoing public purposes. Because it is
1221	essential for this government entity to have the maximum
1222	financial resources to pay claims following a catastrophic
1223	hurricane, it is the intent of the Legislature that Citizens
1224	Property Insurance Corporation continue to be an integral part
1225	of the state and that the income of the corporation be exempt
1226	from federal income taxation and that interest on the debt
1227	obligations issued by the corporation be exempt from federal
1228	income taxation.
1229	2.  The Residential Property and Casualty Joint
1230	Underwriting Association originally created by this statute
1231	shall be known, as of July 1, 2002, as the Citizens Property
1232	Insurance Corporation. The corporation shall provide insurance
1233	for residential and commercial property, for applicants who are
1234	in good faith entitled, but are unable, to procure insurance
1235	through the voluntary market. The corporation shall operate
1236	pursuant to a plan of operation approved by order of the
1237	Financial Services Commission. The plan is subject to continuous
1238	review by the commission. The commission may, by order, withdraw
1239	approval of all or part of a plan if the commission determines
1240	that conditions have changed since approval was granted and that
1241	the purposes of the plan require changes in the plan. The
1242	corporation shall continue to operate pursuant to the plan of
1243	operation approved by the Office of Insurance Regulation until
1244	October 1, 2006. For the purposes of this subsection,
1245	residential coverage includes both personal lines residential
1246	coverage, which consists of the type of coverage provided by
1247	homeowner's, mobile home owner's, dwelling, tenant's,
1248	condominium unit owner's, and similar policies, and commercial
1249	lines residential coverage, which consists of the type of
1250	coverage provided by condominium association, apartment
1251	building, and similar policies.
1252	3.  Effective January 1, 2009, a personal lines residential
1253	structure that has a dwelling replacement cost of $2 million or
1254	more, or a single condominium unit that has a combined dwelling
1255	and content replacement cost of $2 million or more is not
1256	eligible for coverage by the corporation. Such dwellings insured
1257	by the corporation on December 31, 2008, may continue to be
1258	covered by the corporation until the end of the policy term.
1259	However, such dwellings that are insured by the corporation and
1260	become ineligible for coverage due to the provisions of this
1261	subparagraph may reapply and obtain coverage if the property
1262	owner provides the corporation with a sworn affidavit from one
1263	or more insurance agents, on a form provided by the corporation,
1264	stating that the agents have made their best efforts to obtain
1265	coverage and that the property has been rejected for coverage by
1266	at least one authorized insurer and at least three surplus lines
1267	insurers. If such conditions are met, the dwelling may be
1268	insured by the corporation for up to 3 years, after which time
1269	the dwelling is ineligible for coverage. The office shall
1270	approve the method used by the corporation for valuing the
1271	dwelling replacement cost for the purposes of this subparagraph.
1272	If a policyholder is insured by the corporation prior to being
1273	determined to be ineligible pursuant to this subparagraph and
1274	such policyholder files a lawsuit challenging the determination,
1275	the policyholder may remain insured by the corporation until the
1276	conclusion of the litigation.
1277	4.  It is the intent of the Legislature that policyholders,
1278	applicants, and agents of the corporation receive service and
1279	treatment of the highest possible level but never less than that
1280	generally provided in the voluntary market. It also is intended
1281	that the corporation be held to service standards no less than
1282	those applied to insurers in the voluntary market by the office
1283	with respect to responsiveness, timeliness, customer courtesy,
1284	and overall dealings with policyholders, applicants, or agents
1285	of the corporation.
1286	5.  Effective January 1, 2009, a personal lines residential
1287	structure that is located in the "wind-borne debris region," as
1288	defined in s. 1609.2, International Building Code (2006), and
1289	that has an insured value on the structure of $750,000 or more
1290	is not eligible for coverage by the corporation unless the
1291	structure has opening protections as required under the Florida
1292	Building Code for a newly constructed residential structure in
1293	that area. A residential structure shall be deemed to comply
1294	with the requirements of this subparagraph if it has shutters or
1295	opening protections on all openings and if such opening
1296	protections complied with the Florida Building Code at the time
1297	they were installed. Effective January 1, 2010, for personal
1298	lines residential property insured by the corporation that is
1299	located in the wind-borne debris region and has an insured value
1300	on the structure of $500,000 or more, a prospective purchaser of
1301	any such residential property must be provided by the seller a
1302	written disclosure that contains the structure's windstorm
1303	mitigation rating based on the uniform home grading scale
1304	adopted under s. 215.55865. Such rating shall be provided to the
1305	purchaser at or before the time the purchaser executes a
1306	contract for sale and purchase.
1307	(b)1.  All insurers authorized to write one or more subject
1308	lines of business in this state are subject to assessment by the
1309	corporation and, for the purposes of this subsection, are
1310	referred to collectively as "assessable insurers." Insurers
1311	writing one or more subject lines of business in this state
1312	pursuant to part VIII of chapter 626 are not assessable
1313	insurers, but insureds who procure one or more subject lines of
1314	business in this state pursuant to part VIII of chapter 626 are
1315	subject to assessment by the corporation and are referred to
1316	collectively as "assessable insureds." An authorized insurer's
1317	assessment liability shall begin on the first day of the
1318	calendar year following the year in which the insurer was issued
1319	a certificate of authority to transact insurance for subject
1320	lines of business in this state and shall terminate 1 year after
1321	the end of the first calendar year during which the insurer no
1322	longer holds a certificate of authority to transact insurance
1323	for subject lines of business in this state.
1324	2.a.  All revenues, assets, liabilities, losses, and
1325	expenses of the corporation shall be divided into three separate
1326	accounts as follows:
1327	(I)  A personal lines account for personal residential
1328	policies issued by the corporation or issued by the Residential
1329	Property and Casualty Joint Underwriting Association and renewed
1330	by the corporation that provide comprehensive, multiperil
1331	coverage on risks that are not located in areas eligible for
1332	coverage in the Florida Windstorm Underwriting Association as
1333	those areas were defined on January 1, 2002, and for such
1334	policies that do not provide coverage for the peril of wind on
1335	risks that are located in such areas;
1336	(II)  A commercial lines account for commercial residential
1337	and commercial nonresidential policies issued by the corporation
1338	or issued by the Residential Property and Casualty Joint
1339	Underwriting Association and renewed by the corporation that
1340	provide coverage for basic property perils on risks that are not
1341	located in areas eligible for coverage in the Florida Windstorm
1342	Underwriting Association as those areas were defined on January
1343	1, 2002, and for such policies that do not provide coverage for
1344	the peril of wind on risks that are located in such areas; and
1345	(III)  A high-risk account for personal residential
1346	policies and commercial residential and commercial
1347	nonresidential property policies issued by the corporation or
1348	transferred to the corporation that provide coverage for the
1349	peril of wind on risks that are located in areas eligible for
1350	coverage in the Florida Windstorm Underwriting Association as
1351	those areas were defined on January 1, 2002. The corporation may
1352	offer policies that provide multiperil coverage and the
1353	corporation shall continue to offer policies that provide
1354	coverage only for the peril of wind for risks located in areas
1355	eligible for coverage in the high-risk account. In issuing
1356	multiperil coverage, the corporation may use its approved policy
1357	forms and rates for the personal lines account. An applicant or
1358	insured who is eligible to purchase a multiperil policy from the
1359	corporation may purchase a multiperil policy from an authorized
1360	insurer without prejudice to the applicant's or insured's
1361	eligibility to prospectively purchase a policy that provides
1362	coverage only for the peril of wind from the corporation. An
1363	applicant or insured who is eligible for a corporation policy
1364	that provides coverage only for the peril of wind may elect to
1365	purchase or retain such policy and also purchase or retain
1366	coverage excluding wind from an authorized insurer without
1367	prejudice to the applicant's or insured's eligibility to
1368	prospectively purchase a policy that provides multiperil
1369	coverage from the corporation. It is the goal of the Legislature
1370	that there would be an overall average savings of 10 percent or
1371	more for a policyholder who currently has a wind-only policy
1372	with the corporation, and an ex-wind policy with a voluntary
1373	insurer or the corporation, and who then obtains a multiperil
1374	policy from the corporation. It is the intent of the Legislature
1375	that the offer of multiperil coverage in the high-risk account
1376	be made and implemented in a manner that does not adversely
1377	affect the tax-exempt status of the corporation or
1378	creditworthiness of or security for currently outstanding
1379	financing obligations or credit facilities of the high-risk
1380	account, the personal lines account, or the commercial lines
1381	account. The high-risk account must also include quota share
1382	primary insurance under subparagraph (c)2. The area eligible for
1383	coverage under the high-risk account also includes the area
1384	within Port Canaveral, which is bordered on the south by the
1385	City of Cape Canaveral, bordered on the west by the Banana
1386	River, and bordered on the north by Federal Government property.
1387	b.  The three separate accounts must be maintained as long
1388	as financing obligations entered into by the Florida Windstorm
1389	Underwriting Association or Residential Property and Casualty
1390	Joint Underwriting Association are outstanding, in accordance
1391	with the terms of the corresponding financing documents. When
1392	the financing obligations are no longer outstanding, in
1393	accordance with the terms of the corresponding financing
1394	documents, the corporation may use a single account for all
1395	revenues, assets, liabilities, losses, and expenses of the
1396	corporation. Consistent with the requirement of this
1397	subparagraph and prudent investment policies that minimize the
1398	cost of carrying debt, the board shall exercise its best efforts
1399	to retire existing debt or to obtain approval of necessary
1400	parties to amend the terms of existing debt, so as to structure
1401	the most efficient plan to consolidate the three separate
1402	accounts into a single account. By February 1, 2007, the board
1403	shall submit a report to the Financial Services Commission, the
1404	President of the Senate, and the Speaker of the House of
1405	Representatives which includes an analysis of consolidating the
1406	accounts, the actions the board has taken to minimize the cost
1407	of carrying debt, and its recommendations for executing the most
1408	efficient plan.
1409	c.  Creditors of the Residential Property and Casualty
1410	Joint Underwriting Association and of the accounts specified in
1411	sub-sub-subparagraphs a.(I) and (II) may have a claim against,
1412	and recourse to, the accounts referred to in sub-sub-
1413	subparagraphs a.(I) and (II) and shall have no claim against, or
1414	recourse to, the account referred to in sub-sub-subparagraph
1415	a.(III). Creditors of the Florida Windstorm Underwriting
1416	Association shall have a claim against, and recourse to, the
1417	account referred to in sub-sub-subparagraph a.(III) and shall
1418	have no claim against, or recourse to, the accounts referred to
1419	in sub-sub-subparagraphs a.(I) and (II).
1420	d.  Revenues, assets, liabilities, losses, and expenses not
1421	attributable to particular accounts shall be prorated among the
1422	accounts.
1423	e.  The Legislature finds that the revenues of the
1424	corporation are revenues that are necessary to meet the
1425	requirements set forth in documents authorizing the issuance of
1426	bonds under this subsection.
1427	f.  No part of the income of the corporation may inure to
1428	the benefit of any private person.
1429	3.  With respect to a deficit in an account:
1430	a.  After accounting for the Citizens policyholder
1431	surcharge imposed under sub-subparagraph i., when the remaining
1432	projected deficit incurred in a particular calendar year is not
1433	greater than 6 percent of the aggregate statewide direct written
1434	premium for the subject lines of business for the prior calendar
1435	year, the entire deficit shall be recovered through regular
1436	assessments of assessable insurers under paragraph (p) and
1437	assessable insureds.
1438	b.  After accounting for the Citizens policyholder
1439	surcharge imposed under sub-subparagraph i., when the remaining
1440	projected deficit incurred in a particular calendar year exceeds
1441	6 percent of the aggregate statewide direct written premium for
1442	the subject lines of business for the prior calendar year, the
1443	corporation shall levy regular assessments on assessable
1444	insurers under paragraph (p) and on assessable insureds in an
1445	amount equal to the greater of 6 percent of the deficit or 6
1446	percent of the aggregate statewide direct written premium for
1447	the subject lines of business for the prior calendar year. Any
1448	remaining deficit shall be recovered through emergency
1449	assessments under sub-subparagraph d.
1450	c.  Each assessable insurer's share of the amount being
1451	assessed under sub-subparagraph a. or sub-subparagraph b. shall
1452	be in the proportion that the assessable insurer's direct
1453	written premium for the subject lines of business for the year
1454	preceding the assessment bears to the aggregate statewide direct
1455	written premium for the subject lines of business for that year.
1456	The assessment percentage applicable to each assessable insured
1457	is the ratio of the amount being assessed under sub-subparagraph
1458	a. or sub-subparagraph b. to the aggregate statewide direct
1459	written premium for the subject lines of business for the prior
1460	year. Assessments levied by the corporation on assessable
1461	insurers under sub-subparagraphs a. and b. shall be paid as
1462	required by the corporation's plan of operation and paragraph
1463	(p). Assessments levied by the corporation on assessable
1464	insureds under sub-subparagraphs a. and b. shall be collected by
1465	the surplus lines agent at the time the surplus lines agent
1466	collects the surplus lines tax required by s. 626.932 and shall
1467	be paid to the Florida Surplus Lines Service Office at the time
1468	the surplus lines agent pays the surplus lines tax to the
1469	Florida Surplus Lines Service Office. Upon receipt of regular
1470	assessments from surplus lines agents, the Florida Surplus Lines
1471	Service Office shall transfer the assessments directly to the
1472	corporation as determined by the corporation.
1473	d.  Upon a determination by the board of governors that a
1474	deficit in an account exceeds the amount that will be recovered
1475	through regular assessments under sub-subparagraph a. or sub-
1476	subparagraph b., plus the amount that is expected to be
1477	recovered through surcharges under sub-subparagraph i., as to
1478	the remaining projected deficit the board shall levy, after
1479	verification by the office, emergency assessments, for as many
1480	years as necessary to cover the deficits, to be collected by
1481	assessable insurers and the corporation and collected from
1482	assessable insureds upon issuance or renewal of policies for
1483	subject lines of business, excluding National Flood Insurance
1484	policies. The amount of the emergency assessment collected in a
1485	particular year shall be a uniform percentage of that year's
1486	direct written premium for subject lines of business and all
1487	accounts of the corporation, excluding National Flood Insurance
1488	Program policy premiums, as annually determined by the board and
1489	verified by the office. The office shall verify the arithmetic
1490	calculations involved in the board's determination within 30
1491	days after receipt of the information on which the determination
1492	was based. Notwithstanding any other provision of law, the
1493	corporation and each assessable insurer that writes subject
1494	lines of business shall collect emergency assessments from its
1495	policyholders without such obligation being affected by any
1496	credit, limitation, exemption, or deferment. Emergency
1497	assessments levied by the corporation on assessable insureds
1498	shall be collected by the surplus lines agent at the time the
1499	surplus lines agent collects the surplus lines tax required by
1500	s. 626.932 and shall be paid to the Florida Surplus Lines
1501	Service Office at the time the surplus lines agent pays the
1502	surplus lines tax to the Florida Surplus Lines Service Office.
1503	The emergency assessments so collected shall be transferred
1504	directly to the corporation on a periodic basis as determined by
1505	the corporation and shall be held by the corporation solely in
1506	the applicable account. The aggregate amount of emergency
1507	assessments levied for an account under this sub-subparagraph in
1508	any calendar year may, at the discretion of the board of
1509	governors, be less than but may not exceed the greater of 10
1510	percent of the amount needed to cover the deficit, plus
1511	interest, fees, commissions, required reserves, and other costs
1512	associated with financing of the original deficit, or 10 percent
1513	of the aggregate statewide direct written premium for subject
1514	lines of business and for all accounts of the corporation for
1515	the prior year, plus interest, fees, commissions, required
1516	reserves, and other costs associated with financing the deficit.
1517	e.  The corporation may pledge the proceeds of assessments,
1518	projected recoveries from the Florida Hurricane Catastrophe
1519	Fund, other insurance and reinsurance recoverables, policyholder
1520	surcharges and other surcharges, and other funds available to
1521	the corporation as the source of revenue for and to secure bonds
1522	issued under paragraph (p), bonds or other indebtedness issued
1523	under subparagraph (c)3., or lines of credit or other financing
1524	mechanisms issued or created under this subsection, or to retire
1525	any other debt incurred as a result of deficits or events giving
1526	rise to deficits, or in any other way that the board determines
1527	will efficiently recover such deficits. The purpose of the lines
1528	of credit or other financing mechanisms is to provide additional
1529	resources to assist the corporation in covering claims and
1530	expenses attributable to a catastrophe. As used in this
1531	subsection, the term "assessments" includes regular assessments
1532	under sub-subparagraph a., sub-subparagraph b., or subparagraph
1533	(p)1. and emergency assessments under sub-subparagraph d.
1534	Emergency assessments collected under sub-subparagraph d. are
1535	not part of an insurer's rates, are not premium, and are not
1536	subject to premium tax, fees, or commissions; however, failure
1537	to pay the emergency assessment shall be treated as failure to
1538	pay premium. The emergency assessments under sub-subparagraph d.
1539	shall continue as long as any bonds issued or other indebtedness
1540	incurred with respect to a deficit for which the assessment was
1541	imposed remain outstanding, unless adequate provision has been
1542	made for the payment of such bonds or other indebtedness
1543	pursuant to the documents governing such bonds or other
1544	indebtedness.
1545	f.  As used in this subsection for purposes of any deficit
1546	incurred on or after January 25, 2007, the term "subject lines
1547	of business" means insurance written by assessable insurers or
1548	procured by assessable insureds for all property and casualty
1549	lines of business in this state, but not including workers'
1550	compensation or medical malpractice. As used in the sub-
1551	subparagraph, the term "property and casualty lines of business"
1552	includes all lines of business identified on Form 2, Exhibit of
1553	Premiums and Losses, in the annual statement required of
1554	authorized insurers by s. 624.424 and any rule adopted under
1555	this section, except for those lines identified as accident and
1556	health insurance and except for policies written under the
1557	National Flood Insurance Program or the Federal Crop Insurance
1558	Program. For purposes of this sub-subparagraph, the term
1559	"workers' compensation" includes both workers' compensation
1560	insurance and excess workers' compensation insurance.
1561	g.  The Florida Surplus Lines Service Office shall
1562	determine annually the aggregate statewide written premium in
1563	subject lines of business procured by assessable insureds and
1564	shall report that information to the corporation in a form and
1565	at a time the corporation specifies to ensure that the
1566	corporation can meet the requirements of this subsection and the
1567	corporation's financing obligations.
1568	h.  The Florida Surplus Lines Service Office shall verify
1569	the proper application by surplus lines agents of assessment
1570	percentages for regular assessments and emergency assessments
1571	levied under this subparagraph on assessable insureds and shall
1572	assist the corporation in ensuring the accurate, timely
1573	collection and payment of assessments by surplus lines agents as
1574	required by the corporation.
1575	i.  If a deficit is incurred in any account in 2008 or
1576	thereafter, the board of governors shall levy a Citizens
1577	policyholder surcharge against all policyholders of the
1578	corporation for a 12-month period, which shall be collected at
1579	the time of issuance or renewal of a policy, as a uniform
1580	percentage of the premium for the policy of up to 25 15 percent
1581	of such premium, which funds shall be used to offset the
1582	deficit. Citizens policyholder surcharges under this sub-
1583	subparagraph are not considered premium and are not subject to
1584	commissions, fees, or premium taxes. However, failure to pay
1585	such surcharges shall be treated as failure to pay premium.
1586	j.  If the amount of any assessments or surcharges
1587	collected from corporation policyholders, assessable insurers or
1588	their policyholders, or assessable insureds exceeds the amount
1589	of the deficits, such excess amounts shall be remitted to and
1590	retained by the corporation in a reserve to be used by the
1591	corporation, as determined by the board of governors and
1592	approved by the office, to pay claims or reduce any past,
1593	present, or future plan-year deficits or to reduce outstanding
1594	debt.
1595	(c)  The plan of operation of the corporation:
1596	1.  Must provide for adoption of residential property and
1597	casualty insurance policy forms and commercial residential and
1598	nonresidential property insurance forms, which forms must be
1599	approved by the office prior to use. The corporation shall adopt
1600	the following policy forms:
1601	a.  Standard personal lines policy forms that are
1602	comprehensive multiperil policies providing full coverage of a
1603	residential property equivalent to the coverage provided in the
1604	private insurance market under an HO-3, HO-4, or HO-6 policy.
1605	b.  Basic personal lines policy forms that are policies
1606	similar to an HO-8 policy or a dwelling fire policy that provide
1607	coverage meeting the requirements of the secondary mortgage
1608	market, but which coverage is more limited than the coverage
1609	under a standard policy.
1610	c.  Commercial lines residential and nonresidential policy
1611	forms that are generally similar to the basic perils of full
1612	coverage obtainable for commercial residential structures and
1613	commercial nonresidential structures in the admitted voluntary
1614	market.
1615	d.  Personal lines and commercial lines residential
1616	property insurance forms that cover the peril of wind only. The
1617	forms are applicable only to residential properties located in
1618	areas eligible for coverage under the high-risk account referred
1619	to in sub-subparagraph (b)2.a.
1620	e.  Commercial lines nonresidential property insurance
1621	forms that cover the peril of wind only. The forms are
1622	applicable only to nonresidential properties located in areas
1623	eligible for coverage under the high-risk account referred to in
1624	sub-subparagraph (b)2.a.
1625	f.  The corporation may adopt variations of the policy
1626	forms listed in sub-subparagraphs a.-e. that contain more
1627	restrictive coverage.
1628	2.a.  Must provide that the corporation adopt a program in
1629	which the corporation and authorized insurers enter into quota
1630	share primary insurance agreements for hurricane coverage, as
1631	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1632	property insurance forms for eligible risks which cover the
1633	peril of wind only. As used in this subsection, the term:
1634	(I)  "Quota share primary insurance" means an arrangement
1635	in which the primary hurricane coverage of an eligible risk is
1636	provided in specified percentages by the corporation and an
1637	authorized insurer. The corporation and authorized insurer are
1638	each solely responsible for a specified percentage of hurricane
1639	coverage of an eligible risk as set forth in a quota share
1640	primary insurance agreement between the corporation and an
1641	authorized insurer and the insurance contract. The
1642	responsibility of the corporation or authorized insurer to pay
1643	its specified percentage of hurricane losses of an eligible
1644	risk, as set forth in the quota share primary insurance
1645	agreement, may not be altered by the inability of the other
1646	party to the agreement to pay its specified percentage of
1647	hurricane losses. Eligible risks that are provided hurricane
1648	coverage through a quota share primary insurance arrangement
1649	must be provided policy forms that set forth the obligations of
1650	the corporation and authorized insurer under the arrangement,
1651	clearly specify the percentages of quota share primary insurance
1652	provided by the corporation and authorized insurer, and
1653	conspicuously and clearly state that neither the authorized
1654	insurer nor the corporation may be held responsible beyond its
1655	specified percentage of coverage of hurricane losses.
1656	(II)  "Eligible risks" means personal lines residential and
1657	commercial lines residential risks that meet the underwriting
1658	criteria of the corporation and are located in areas that were
1659	eligible for coverage by the Florida Windstorm Underwriting
1660	Association on January 1, 2002.
1661	b.  The corporation may enter into quota share primary
1662	insurance agreements with authorized insurers at corporation
1663	coverage levels of 90 percent and 50 percent.
1664	c.  If the corporation determines that additional coverage
1665	levels are necessary to maximize participation in quota share
1666	primary insurance agreements by authorized insurers, the
1667	corporation may establish additional coverage levels. However,
1668	the corporation's quota share primary insurance coverage level
1669	may not exceed 90 percent.
1670	d.  Any quota share primary insurance agreement entered
1671	into between an authorized insurer and the corporation must
1672	provide for a uniform specified percentage of coverage of
1673	hurricane losses, by county or territory as set forth by the
1674	corporation board, for all eligible risks of the authorized
1675	insurer covered under the quota share primary insurance
1676	agreement.
1677	e.  Any quota share primary insurance agreement entered
1678	into between an authorized insurer and the corporation is
1679	subject to review and approval by the office. However, such
1680	agreement shall be authorized only as to insurance contracts
1681	entered into between an authorized insurer and an insured who is
1682	already insured by the corporation for wind coverage.
1683	f.  For all eligible risks covered under quota share
1684	primary insurance agreements, the exposure and coverage levels
1685	for both the corporation and authorized insurers shall be
1686	reported by the corporation to the Florida Hurricane Catastrophe
1687	Fund. For all policies of eligible risks covered under quota
1688	share primary insurance agreements, the corporation and the
1689	authorized insurer shall maintain complete and accurate records
1690	for the purpose of exposure and loss reimbursement audits as
1691	required by Florida Hurricane Catastrophe Fund rules. The
1692	corporation and the authorized insurer shall each maintain
1693	duplicate copies of policy declaration pages and supporting
1694	claims documents.
1695	g.  The corporation board shall establish in its plan of
1696	operation standards for quota share agreements which ensure that
1697	there is no discriminatory application among insurers as to the
1698	terms of quota share agreements, pricing of quota share
1699	agreements, incentive provisions if any, and consideration paid
1700	for servicing policies or adjusting claims.
1701	h.  The quota share primary insurance agreement between the
1702	corporation and an authorized insurer must set forth the
1703	specific terms under which coverage is provided, including, but
1704	not limited to, the sale and servicing of policies issued under
1705	the agreement by the insurance agent of the authorized insurer
1706	producing the business, the reporting of information concerning
1707	eligible risks, the payment of premium to the corporation, and
1708	arrangements for the adjustment and payment of hurricane claims
1709	incurred on eligible risks by the claims adjuster and personnel
1710	of the authorized insurer. Entering into a quota sharing
1711	insurance agreement between the corporation and an authorized
1712	insurer shall be voluntary and at the discretion of the
1713	authorized insurer.
1714	3.  May provide that the corporation may employ or
1715	otherwise contract with individuals or other entities to provide
1716	administrative or professional services that may be appropriate
1717	to effectuate the plan. The corporation shall have the power to
1718	borrow funds, by issuing bonds or by incurring other
1719	indebtedness, and shall have other powers reasonably necessary
1720	to effectuate the requirements of this subsection, including,
1721	without limitation, the power to issue bonds and incur other
1722	indebtedness in order to refinance outstanding bonds or other
1723	indebtedness. The corporation may, but is not required to, seek
1724	judicial validation of its bonds or other indebtedness under
1725	chapter 75. The corporation may issue bonds or incur other
1726	indebtedness, or have bonds issued on its behalf by a unit of
1727	local government pursuant to subparagraph (p)2., in the absence
1728	of a hurricane or other weather-related event, upon a
1729	determination by the corporation, subject to approval by the
1730	office, that such action would enable it to efficiently meet the
1731	financial obligations of the corporation and that such
1732	financings are reasonably necessary to effectuate the
1733	requirements of this subsection. The corporation is authorized
1734	to take all actions needed to facilitate tax-free status for any
1735	such bonds or indebtedness, including formation of trusts or
1736	other affiliated entities. The corporation shall have the
1737	authority to pledge assessments, projected recoveries from the
1738	Florida Hurricane Catastrophe Fund, other reinsurance
1739	recoverables, market equalization and other surcharges, and
1740	other funds available to the corporation as security for bonds
1741	or other indebtedness. In recognition of s. 10, Art. I of the
1742	State Constitution, prohibiting the impairment of obligations of
1743	contracts, it is the intent of the Legislature that no action be
1744	taken whose purpose is to impair any bond indenture or financing
1745	agreement or any revenue source committed by contract to such
1746	bond or other indebtedness.
1747	4.a.  Must require that the corporation operate subject to
1748	the supervision and approval of a board of governors consisting
1749	of eight individuals who are residents of this state, from
1750	different geographical areas of this state. The Governor, the
1751	Chief Financial Officer, the President of the Senate, and the
1752	Speaker of the House of Representatives shall each appoint two
1753	members of the board. At least one of the two members appointed
1754	by each appointing officer must have demonstrated expertise in
1755	insurance. The Chief Financial Officer shall designate one of
1756	the appointees as chair. All board members serve at the pleasure
1757	of the appointing officer. All members of the board of governors
1758	are subject to removal at will by the officers who appointed
1759	them. Except as otherwise provided, all board members, including
1760	the chair, must be appointed to serve for 3-year terms beginning
1761	annually on a date designated by the plan. However, for the
1762	first term beginning on or after July 1, 2009, each appointing
1763	officer shall appoint one member of the board for a 2-year term
1764	and one member for a 3-year term. Any board vacancy shall be
1765	filled for the unexpired term by the appointing officer. The
1766	Chief Financial Officer shall appoint a technical advisory group
1767	to provide information and advice to the board of governors in
1768	connection with the board's duties under this subsection. The
1769	executive director and senior managers of the corporation shall
1770	be engaged by the board and serve at the pleasure of the board.
1771	Any executive director appointed on or after July 1, 2006, is
1772	subject to confirmation by the Senate. The executive director is
1773	responsible for employing other staff as the corporation may
1774	require, subject to review and concurrence by the board.
1775	b.  The board shall create a Market Accountability Advisory
1776	Committee to assist the corporation in developing awareness of
1777	its rates and its customer and agent service levels in
1778	relationship to the voluntary market insurers writing similar
1779	coverage. The members of the advisory committee shall consist of
1780	the following 11 persons, one of whom must be elected chair by
1781	the members of the committee: four representatives, one
1782	appointed by the Florida Association of Insurance Agents, one by
1783	the Florida Association of Insurance and Financial Advisors, one
1784	by the Professional Insurance Agents of Florida, and one by the
1785	Latin American Association of Insurance Agencies; three
1786	representatives appointed by the insurers with the three highest
1787	voluntary market share of residential property insurance
1788	business in the state; one representative from the Office of
1789	Insurance Regulation; one consumer appointed by the board who is
1790	insured by the corporation at the time of appointment to the
1791	committee; one representative appointed by the Florida
1792	Association of Realtors; and one representative appointed by the
1793	Florida Bankers Association. All members must serve for 3-year
1794	terms and may serve for consecutive terms. The committee shall
1795	report to the corporation at each board meeting on insurance
1796	market issues which may include rates and rate competition with
1797	the voluntary market; service, including policy issuance, claims
1798	processing, and general responsiveness to policyholders,
1799	applicants, and agents; and matters relating to depopulation.
1800	5.  Must provide a procedure for determining the
1801	eligibility of a risk for coverage, as follows:
1802	a.  Subject to the provisions of s. 627.3517, with respect
1803	to personal lines residential risks, if the risk is offered
1804	coverage from an authorized insurer at the insurer's approved
1805	rate under either a standard policy including wind coverage or,
1806	if consistent with the insurer's underwriting rules as filed
1807	with the office, a basic policy including wind coverage, for a
1808	new application to the corporation for coverage, the risk is not
1809	eligible for any policy issued by the corporation unless the
1810	premium for coverage from the authorized insurer is more than 15
1811	percent greater than the premium for comparable coverage from
1812	the corporation. If the risk is not able to obtain any such
1813	offer, the risk is eligible for either a standard policy
1814	including wind coverage or a basic policy including wind
1815	coverage issued by the corporation; however, if the risk could
1816	not be insured under a standard policy including wind coverage
1817	regardless of market conditions, the risk shall be eligible for
1818	a basic policy including wind coverage unless rejected under
1819	subparagraph 8. However, with regard to a policyholder of the
1820	corporation or a policyholder removed from the corporation
1821	through an assumption agreement until the end of the assumption
1822	period, the policyholder remains eligible for coverage from the
1823	corporation regardless of any offer of coverage from an
1824	authorized insurer or surplus lines insurer. The corporation
1825	shall determine the type of policy to be provided on the basis
1826	of objective standards specified in the underwriting manual and
1827	based on generally accepted underwriting practices.
1828	(I)  If the risk accepts an offer of coverage through the
1829	market assistance plan or an offer of coverage through a
1830	mechanism established by the corporation before a policy is
1831	issued to the risk by the corporation or during the first 30
1832	days of coverage by the corporation, and the producing agent who
1833	submitted the application to the plan or to the corporation is
1834	not currently appointed by the insurer, the insurer shall:
1835	(A)  Pay to the producing agent of record of the policy,
1836	for the first year, an amount that is the greater of the
1837	insurer's usual and customary commission for the type of policy
1838	written or a fee equal to the usual and customary commission of
1839	the corporation; or
1840	(B)  Offer to allow the producing agent of record of the
1841	policy to continue servicing the policy for a period of not less
1842	than 1 year and offer to pay the agent the greater of the
1843	insurer's or the corporation's usual and customary commission
1844	for the type of policy written.
1845
1846	If the producing agent is unwilling or unable to accept
1847	appointment, the new insurer shall pay the agent in accordance
1848	with sub-sub-sub-subparagraph (A).
1849	(II)  When the corporation enters into a contractual
1850	agreement for a take-out plan, the producing agent of record of
1851	the corporation policy is entitled to retain any unearned
1852	commission on the policy, and the insurer shall:
1853	(A)  Pay to the producing agent of record of the
1854	corporation policy, for the first year, an amount that is the
1855	greater of the insurer's usual and customary commission for the
1856	type of policy written or a fee equal to the usual and customary
1857	commission of the corporation; or
1858	(B)  Offer to allow the producing agent of record of the
1859	corporation policy to continue servicing the policy for a period
1860	of not less than 1 year and offer to pay the agent the greater
1861	of the insurer's or the corporation's usual and customary
1862	commission for the type of policy written.
1863
1864	If the producing agent is unwilling or unable to accept
1865	appointment, the new insurer shall pay the agent in accordance
1866	with sub-sub-sub-subparagraph (A).
1867	b.  With respect to commercial lines residential risks, for
1868	a new application to the corporation for coverage, if the risk
1869	is offered coverage under a policy including wind coverage from
1870	an authorized insurer at its approved rate, the risk is not
1871	eligible for any policy issued by the corporation unless the
1872	premium for coverage from the authorized insurer is more than 15
1873	percent greater than the premium for comparable coverage from
1874	the corporation. If the risk is not able to obtain any such
1875	offer, the risk is eligible for a policy including wind coverage
1876	issued by the corporation. However, with regard to a
1877	policyholder of the corporation or a policyholder removed from
1878	the corporation through an assumption agreement until the end of
1879	the assumption period, the policyholder remains eligible for
1880	coverage from the corporation regardless of any offer of
1881	coverage from an authorized insurer or surplus lines insurer.
1882	(I)  If the risk accepts an offer of coverage through the
1883	market assistance plan or an offer of coverage through a
1884	mechanism established by the corporation before a policy is
1885	issued to the risk by the corporation or during the first 30
1886	days of coverage by the corporation, and the producing agent who
1887	submitted the application to the plan or the corporation is not
1888	currently appointed by the insurer, the insurer shall:
1889	(A)  Pay to the producing agent of record of the policy,
1890	for the first year, an amount that is the greater of the
1891	insurer's usual and customary commission for the type of policy
1892	written or a fee equal to the usual and customary commission of
1893	the corporation; or
1894	(B)  Offer to allow the producing agent of record of the
1895	policy to continue servicing the policy for a period of not less
1896	than 1 year and offer to pay the agent the greater of the
1897	insurer's or the corporation's usual and customary commission
1898	for the type of policy written.
1899
1900	If the producing agent is unwilling or unable to accept
1901	appointment, the new insurer shall pay the agent in accordance
1902	with sub-sub-sub-subparagraph (A).
1903	(II)  When the corporation enters into a contractual
1904	agreement for a take-out plan, the producing agent of record of
1905	the corporation policy is entitled to retain any unearned
1906	commission on the policy, and the insurer shall:
1907	(A)  Pay to the producing agent of record of the
1908	corporation policy, for the first year, an amount that is the
1909	greater of the insurer's usual and customary commission for the
1910	type of policy written or a fee equal to the usual and customary
1911	commission of the corporation; or
1912	(B)  Offer to allow the producing agent of record of the
1913	corporation policy to continue servicing the policy for a period
1914	of not less than 1 year and offer to pay the agent the greater
1915	of the insurer's or the corporation's usual and customary
1916	commission for the type of policy written.
1917
1918	If the producing agent is unwilling or unable to accept
1919	appointment, the new insurer shall pay the agent in accordance
1920	with sub-sub-sub-subparagraph (A).
1921	c.  For purposes of determining comparable coverage under
1922	sub-subparagraphs a. and b., the comparison shall be based on
1923	those forms and coverages that are reasonably comparable. The
1924	corporation may rely on a determination of comparable coverage
1925	and premium made by the producing agent who submits the
1926	application to the corporation, made in the agent's capacity as
1927	the corporation's agent. A comparison may be made solely of the
1928	premium with respect to the main building or structure only on
1929	the following basis: the same coverage A or other building
1930	limits; the same percentage hurricane deductible that applies on
1931	an annual basis or that applies to each hurricane for commercial
1932	residential property; the same percentage of ordinance and law
1933	coverage, if the same limit is offered by both the corporation
1934	and the authorized insurer; the same mitigation credits, to the
1935	extent the same types of credits are offered both by the
1936	corporation and the authorized insurer; the same method for loss
1937	payment, such as replacement cost or actual cash value, if the
1938	same method is offered both by the corporation and the
1939	authorized insurer in accordance with underwriting rules; and
1940	any other form or coverage that is reasonably comparable as
1941	determined by the board. If an application is submitted to the
1942	corporation for wind-only coverage in the high-risk account, the
1943	premium for the corporation's wind-only policy plus the premium
1944	for the ex-wind policy that is offered by an authorized insurer
1945	to the applicant shall be compared to the premium for multiperil
1946	coverage offered by an authorized insurer, subject to the
1947	standards for comparison specified in this subparagraph. If the
1948	corporation or the applicant requests from the authorized
1949	insurer a breakdown of the premium of the offer by types of
1950	coverage so that a comparison may be made by the corporation or
1951	its agent and the authorized insurer refuses or is unable to
1952	provide such information, the corporation may treat the offer as
1953	not being an offer of coverage from an authorized insurer at the
1954	insurer's approved rate.
1955	6.  Must include rules for classifications of risks and
1956	rates therefor.
1957	7.  Must provide that if premium and investment income for
1958	an account attributable to a particular calendar year are in
1959	excess of projected losses and expenses for the account
1960	attributable to that year, such excess shall be held in surplus
1961	in the account. Such surplus shall be available to defray
1962	deficits in that account as to future years and shall be used
1963	for that purpose prior to assessing assessable insurers and
1964	assessable insureds as to any calendar year.
1965	8.  Must provide objective criteria and procedures to be
1966	uniformly applied for all applicants in determining whether an
1967	individual risk is so hazardous as to be uninsurable. In making
1968	this determination and in establishing the criteria and
1969	procedures, the following shall be considered:
1970	a.  Whether the likelihood of a loss for the individual
1971	risk is substantially higher than for other risks of the same
1972	class; and
1973	b.  Whether the uncertainty associated with the individual
1974	risk is such that an appropriate premium cannot be determined.
1975
1976	The acceptance or rejection of a risk by the corporation shall
1977	be construed as the private placement of insurance, and the
1978	provisions of chapter 120 shall not apply.
1979	9.  Must provide that the corporation shall make its best
1980	efforts to procure catastrophe reinsurance at reasonable rates,
1981	to cover its projected 100-year probable maximum loss as
1982	determined by the board of governors.
1983	10.  The policies issued by the corporation must provide
1984	that, if the corporation or the market assistance plan obtains
1985	an offer from an authorized insurer to cover the risk at its
1986	approved rates, the risk is no longer eligible for renewal
1987	through the corporation, except as otherwise provided in this
1988	subsection.
1989	11.  Corporation policies and applications must include a
1990	notice that the corporation policy could, under this section, be
1991	replaced with a policy issued by an authorized insurer that does
1992	not provide coverage identical to the coverage provided by the
1993	corporation. The notice shall also specify that acceptance of
1994	corporation coverage creates a conclusive presumption that the
1995	applicant or policyholder is aware of this potential.
1996	12.  May establish, subject to approval by the office,
1997	different eligibility requirements and operational procedures
1998	for any line or type of coverage for any specified county or
1999	area if the board determines that such changes to the
2000	eligibility requirements and operational procedures are
2001	justified due to the voluntary market being sufficiently stable
2002	and competitive in such area or for such line or type of
2003	coverage and that consumers who, in good faith, are unable to
2004	obtain insurance through the voluntary market through ordinary
2005	methods would continue to have access to coverage from the
2006	corporation. When coverage is sought in connection with a real
2007	property transfer, such requirements and procedures shall not
2008	provide for an effective date of coverage later than the date of
2009	the closing of the transfer as established by the transferor,
2010	the transferee, and, if applicable, the lender.
2011	13.  Must provide that, with respect to the high-risk
2012	account, any assessable insurer with a surplus as to
2013	policyholders of $25 million or less writing 25 percent or more
2014	of its total countrywide property insurance premiums in this
2015	state may petition the office, within the first 90 days of each
2016	calendar year, to qualify as a limited apportionment company. A
2017	regular assessment levied by the corporation on a limited
2018	apportionment company for a deficit incurred by the corporation
2019	for the high-risk account in 2006 or thereafter may be paid to
2020	the corporation on a monthly basis as the assessments are
2021	collected by the limited apportionment company from its insureds
2022	pursuant to s. 627.3512, but the regular assessment must be paid
2023	in full within 12 months after being levied by the corporation.
2024	A limited apportionment company shall collect from its
2025	policyholders any emergency assessment imposed under sub-
2026	subparagraph (b)3.d. The plan shall provide that, if the office
2027	determines that any regular assessment will result in an
2028	impairment of the surplus of a limited apportionment company,
2029	the office may direct that all or part of such assessment be
2030	deferred as provided in subparagraph (p)4. However, there shall
2031	be no limitation or deferment of an emergency assessment to be
2032	collected from policyholders under sub-subparagraph (b)3.d.
2033	14.  Must provide that the corporation appoint as its
2034	licensed agents only those agents who also hold an appointment
2035	as defined in s. 626.015(3) with an insurer who at the time of
2036	the agent's initial appointment by the corporation is authorized
2037	to write and is actually writing personal lines residential
2038	property coverage, commercial residential property coverage, or
2039	commercial nonresidential property coverage within the state.
2040	15.  Must provide, by July 1, 2007, a premium payment plan
2041	option to its policyholders which allows at a minimum for
2042	quarterly and semiannual payment of premiums. A monthly payment
2043	plan may, but is not required to, be offered.
2044	16.  Must limit coverage on mobile homes or manufactured
2045	homes built prior to 1994 to actual cash value of the dwelling
2046	rather than replacement costs of the dwelling.
2047	17.  May provide such limits of coverage as the board
2048	determines, consistent with the requirements of this subsection.
2049	18.  May require commercial property to meet specified
2050	hurricane mitigation construction features as a condition of
2051	eligibility for coverage.
2052	(m)1.  Rates for coverage provided by the corporation shall
2053	be actuarially sound and subject to the requirements of s.
2054	627.062, except as otherwise provided in this paragraph. The
2055	corporation shall file its recommended rates with the office at
2056	least annually. The corporation shall provide any additional
2057	information regarding the rates which the office requires. The
2058	office shall consider the recommendations of the board and issue
2059	a final order establishing the rates for the corporation within
2060	45 days after the recommended rates are filed. The corporation
2061	may not pursue an administrative challenge or judicial review of
2062	the final order of the office.
2063	2.  In addition to the rates otherwise determined pursuant
2064	to this paragraph, the corporation shall impose and collect an
2065	amount equal to the premium tax provided for in s. 624.509 to
2066	augment the financial resources of the corporation.
2067	3.  After the public hurricane loss-projection model under
2068	s. 627.06281 has been found to be accurate and reliable by the
2069	Florida Commission on Hurricane Loss Projection Methodology,
2070	that model shall serve as the minimum benchmark for determining
2071	the windstorm portion of the corporation's rates. This
2072	subparagraph does not require or allow the corporation to adopt
2073	rates lower than the rates otherwise required or allowed by this
2074	paragraph.
2075	4.  The rate filings for the corporation which were
2076	approved by the office and which took effect January 1, 2007,
2077	are rescinded, except for those rates that were lowered. As soon
2078	as possible, the corporation shall begin using the lower rates
2079	that were in effect on December 31, 2006, and shall provide
2080	refunds to policyholders who have paid higher rates as a result
2081	of that rate filing. The rates in effect on December 31, 2006,
2082	shall remain in effect for the 2007 and 2008 calendar years
2083	except for any rate change that results in a lower rate. The
2084	next rate change that may increase rates shall take effect
2085	pursuant to a new rate filing recommended by the corporation and
2086	established by the office, subject to the requirements of this
2087	paragraph.
2088	5.  Beginning on July 15, 2009, and each year thereafter,
2089	the corporation must make a recommended actuarially sound rate
2090	filing for each personal and commercial line of business it
2091	writes, to be effective no earlier than January 1, 2010.
2092	6.  The Legislature finds that it is in the public interest
2093	to ensure that actuarially sound rates for coverage by the
2094	corporation be implemented incrementally to provide rate
2095	stability and predictability to its policyholders.
2096	7.  Beginning on or after January 1, 2010, the corporation
2097	shall begin to implement actuarially sound rates for each
2098	commercial and personal line of business it writes, which may
2099	not exceed an average statewide increase of 10 percent or exceed
2100	20 percent for any single policy issued by the corporation,
2101	excluding coverage changes and surcharges.
2102	8.  The corporation's incremental implementation of rates
2103	as prescribed in subparagraph 7. shall cease for any line of
2104	business written by the corporation after actuarially sound
2105	rates as prescribed in subparagraph 1. are achieved. Thereafter,
2106	the corporation shall annually make a recommended actuarially
2107	sound rate filing for each commercial and personal line of
2108	business it writes.
2109	9.  In addition to the rate increase required pursuant to
2110	subparagraph 7., the corporation may increase its rates an
2111	amount sufficient to recoup additional reimbursement premium
2112	paid to the Florida Hurricane Catastrophe Fund due to the
2113	application of a cash build-up factor.
2114	10.  Beginning April 1, 2010, and each quarter thereafter,
2115	the corporation shall transfer 10 percent of the funds received
2116	from the rate increase prescribed by subparagraph 7. to the
2117	Insurance Regulatory Trust Fund in the Department of Financial
2118	Services. The corporation's transfer of such funds shall cease
2119	upon the corporation's implementation of actuarially sound rates
2120	as prescribed in subparagraph 1.
2121	(x)  It is the intent of the Legislature that the
2122	amendments to this subsection enacted in 2002 should, over time,
2123	reduce the probable maximum windstorm losses in the residual
2124	markets and should reduce the potential assessments to be levied
2125	on property insurers and policyholders statewide. In furtherance
2126	of this intent:
2127	1.  The board shall, on or before February 1 of each year,
2128	provide a report to the President of the Senate and the Speaker
2129	of the House of Representatives showing the reduction or
2130	increase in the 100-year probable maximum loss attributable to
2131	wind-only coverages and the quota share program under this
2132	subsection combined, as compared to the benchmark 100-year
2133	probable maximum loss of the Florida Windstorm Underwriting
2134	Association. For purposes of this paragraph, the benchmark 100-
2135	year probable maximum loss of the Florida Windstorm Underwriting
2136	Association shall be the calculation dated February 2001 and
2137	based on November 30, 2000, exposures. In order to ensure
2138	comparability of data, the board shall use the same methods for
2139	calculating its probable maximum loss as were used to calculate
2140	the benchmark probable maximum loss.
2141	2.  Beginning February 1, 2010, if the report under
2142	subparagraph 1. for any year indicates that the 100-year
2143	probable maximum loss attributable to wind-only coverages and
2144	the quota share program combined does not reflect a reduction of
2145	at least 25 percent from the benchmark, the board shall reduce
2146	the boundaries of the high-risk area eligible for wind-only
2147	coverages under this subsection in a manner calculated to reduce
2148	such probable maximum loss to an amount at least 25 percent
2149	below the benchmark.
2150	3.  Beginning February 1, 2015, if the report under
2151	subparagraph 1. for any year indicates that the 100-year
2152	probable maximum loss attributable to wind-only coverages and
2153	the quota share program combined does not reflect a reduction of
2154	at least 50 percent from the benchmark, the boundaries of the
2155	high-risk area eligible for wind-only coverages under this
2156	subsection shall be reduced by the elimination of any area that
2157	is not seaward of a line 1,000 feet inland from the Intracoastal
2158	Waterway.
2159	Section 12.  Subsection (2) of section 627.711, Florida
2160	Statutes, is amended, and subsection (3) is added to that
2161	section, to read:
2162	627.711  Notice of premium discounts for hurricane loss
2163	mitigation; uniform mitigation verification inspection form.--
2164	(2)(a)  By July 1, 2007, the Financial Services Commission
2165	shall develop by rule a uniform mitigation verification
2166	inspection form that shall be used by all insurers when
2167	submitted by policyholders for the purpose of factoring
2168	discounts for wind insurance. In developing the form, the
2169	commission shall seek input from insurance, construction, and
2170	building code representatives. Further, the commission shall
2171	provide guidance as to the length of time the inspection results
2172	are valid. An insurer shall accept as valid a uniform mitigation
2173	verification form certified by the Department of Financial
2174	Services or signed by:
2175	(a)  A hurricane mitigation inspector employed by an
2176	approved My Safe Florida Home wind certification entity;
2177	1.(b)  A building code inspector certified under s.
2178	468.607;
2179	2.(c)  A general, building, or residential contractor
2180	licensed under s. 489.111;
2181	3.(d)  A professional engineer licensed under s. 471.015
2182	who has passed the appropriate equivalency test of the Building
2183	Code Training Program as required by s. 553.841; or
2184	4.(e)  A professional architect licensed under s. 481.213.
2185	(b)  An insurer may contract with inspection firms at the
2186	insurer's expense to review mitigation verification forms and to
2187	reinspect properties for which the insurer receives mitigation
2188	verification forms to ensure that the forms are valid.
2189	(3)  An individual or entity who knowingly provides or
2190	utters a false or fraudulent mitigation verification form with
2191	the intent to obtain or receive a discount on an insurance
2192	premium to which the individual or entity is not entitled
2193	commits a misdemeanor of the first degree, punishable as
2194	provided in s. 775.082 or s. 775.083.
2195	Section 13.  Subsection (1) and paragraph (c) of subsection
2196	(2) of section 627.712, Florida Statutes, are amended to read:
2197	627.712  Residential windstorm coverage required;
2198	availability of exclusions for windstorm or contents.--
2199	(1)  An insurer issuing a residential property insurance
2200	policy must provide windstorm coverage. Except as provided in
2201	paragraph (2)(c), this section does not apply with respect to
2202	risks that are eligible for wind-only coverage from Citizens
2203	Property Insurance Corporation under s. 627.351(6) and with
2204	respect to risks that are not eligible for coverage from
2205	Citizens Property Insurance Corporation under s. 627.351(6)(a)3.
2206	or 5. A risk ineligible for Citizens coverage under s.
2207	627.351(6)(a)3. or 5. is exempt from the requirements of this
2208	section only if the risk is located within the boundaries of the
2209	high-risk account of the corporation.
2210	(2)  A property insurer must make available, at the option
2211	of the policyholder, an exclusion of windstorm coverage.
2212	(c)  If the residential structure is eligible for wind-only
2213	coverage from Citizens Property Insurance Corporation, An
2214	insurer nonrenewing a policy and issuing a replacement policy,
2215	or issuing a new policy, that does not provide wind coverage
2216	shall provide a notice to the mortgageholder or lienholder
2217	indicating the policyholder has elected coverage that does not
2218	cover wind.
2219	Section 14.  Section 631.65, Florida Statutes, is amended
2220	to read:
2221	631.65  Prohibited advertisement or solicitation.--No
2222	person shall make, publish, disseminate, circulate, or place
2223	before the public, or cause, directly or indirectly, to be made,
2224	published, disseminated, circulated, or placed before the
2225	public, in a newspaper, magazine, or other publication, or in
2226	the form of a notice, circular, pamphlet, letter, or poster, or
2227	over any radio station or television station, or in any other
2228	way, any advertisement, announcement, or statement which uses
2229	the existence of the insurance guaranty association for the
2230	purpose of sales, solicitation, or inducement to purchase any
2231	form of insurance covered under this part. However, nothing in
2232	this section may be construed to prevent a duly licensed
2233	insurance agent from providing explanations concerning the
2234	existence or application of the insurance guaranty association
2235	to policyholders, prospective policyholders, or applicants for
2236	coverage.
2237	Section 15.  The My Safe Florida Home Program specified in
2238	s. 215.5586, Florida Statutes, shall use the funds transferred
2239	to the Insurance Regulatory Trust Fund pursuant to s.
2240	627.351(6)(m)10., Florida Statutes, solely for the provision of
2241	mitigation grants in accordance with s. 215.5586(2), Florida
2242	Statutes, to policyholders of Citizens Property Insurance
2243	Corporation who are otherwise eligible for grants from the My
2244	Safe Florida Home Program. The department shall establish a
2245	separate account within the trust fund for accounting purposes.
2246	Section 16.  This act shall take effect upon becoming a
2247	law.

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