| 1 | A bill to be entitled |
| 2 | An act relating to self-insurance funds; creating s. |
| 3 | 624.4626, F.S.; authorizing certain electric cooperatives |
| 4 | to operate a self-insurance fund for certain purposes; |
| 5 | providing requirements; subjecting such funds to certain |
| 6 | assessments; exempting such funds from certain group self- |
| 7 | insurance fund requirements under certain circumstances; |
| 8 | amending s. 624.472, F.S.; revising type requirements for |
| 9 | contingent liability policies; amending s. 631.904, F.S.; |
| 10 | revising the definition of "self-insurance fund" under the |
| 11 | Florida Workers' Compensation Insurance Guaranty |
| 12 | Association Act to exclude certain types of self-insurance |
| 13 | funds; providing an effective date. |
| 14 |
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| 15 | Be It Enacted by the Legislature of the State of Florida: |
| 16 |
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| 17 | Section 1. Section 624.4626, Florida Statutes, is created |
| 18 | to read: |
| 19 | 624.4626 Electric cooperative self-insurance fund.-- |
| 20 | (1) Notwithstanding any other provision of law, any two or |
| 21 | more electric cooperatives organized pursuant to chapter 425 may |
| 22 | operate a self-insurance fund for the purpose of pooling and |
| 23 | spreading liabilities of its group members in securing the |
| 24 | payment of benefits under chapter 440, provided the self- |
| 25 | insurance fund must: |
| 26 | (a) Require that every member of the fund is jointly and |
| 27 | severally liable for the obligations of the fund. |
| 28 | (b) Maintain a continuing program of excess insurance |
| 29 | coverage and reserve evaluation to protect the financial |
| 30 | stability of the fund in an amount and manner determined by a |
| 31 | qualified and independent actuary. |
| 32 | (c) Subscribe to, or be a member of, a rating organization |
| 33 | as prescribed in s. 627.231. |
| 34 | (d) Have its year-end financial statement audited by an |
| 35 | independent certified public accountant within 6 months after |
| 36 | the end of the fiscal year. |
| 37 | (e) Have a governing body which is comprised of a |
| 38 | representative from each member of the fund. |
| 39 | (f) Limit membership in the fund to electric cooperatives |
| 40 | that operate in this state, their subsidiaries, and the current |
| 41 | members of the Florida Rural Electric Self-Insurer's Fund. |
| 42 | (g) At renewal, provide the members of the fund a |
| 43 | disclosure statement that notifies the members that the fund is |
| 44 | not regulated by the office. |
| 45 | (2) A self-insurance fund that meets the requirements of |
| 46 | this section is subject to the assessments set forth in ss. |
| 47 | 440.49(9), 440.51(1), and 624.4621(7), but is not subject to any |
| 48 | other provision of s. 624.4621 and is not required to file any |
| 49 | report with the department under s. 440.38(2)(b) which is |
| 50 | uniquely required of group self-insurer funds qualified under s. |
| 51 | 624.4621. |
| 52 | Section 2. Subsection (3) of section 624.472, Florida |
| 53 | Statutes, is amended to read: |
| 54 | 624.472 Member's liability.-- |
| 55 | (3) Each policy issued by the fund shall contain a |
| 56 | statement of the contingent liability. Both the application for |
| 57 | insurance and the policy shall contain, in boldface contrasting |
| 58 | color and in not less than 10-point type, the following |
| 59 | statements: "This is a fully assessable policy. If In the event |
| 60 | the fund is unable to pay its obligations, policyholders will be |
| 61 | required to contribute on a pro rata earned premium basis the |
| 62 | money necessary to meet any unfilled obligations." In lieu of |
| 63 | the notice provided for above, a fund with governmental entity |
| 64 | members shall provide the following notice to members other than |
| 65 | governmental entities: "This is a fully assessable policy. In |
| 66 | the event the fund is unable to pay its obligations related to |
| 67 | members which are not governmental entities, the policyholders |
| 68 | which are not governmental entities will be required to |
| 69 | contribute on a pro rata earned premium basis the money |
| 70 | necessary to meet any such unfilled obligations." A fund with |
| 71 | governmental entity members shall provide the following notice |
| 72 | to governmental entity members: "This is a fully assessable |
| 73 | policy. In the event the fund is unable to pay its obligations |
| 74 | related to governmental entity members, governmental entity |
| 75 | policyholders will be required to contribute on a pro rata |
| 76 | earned premium basis the money necessary to meet any such |
| 77 | unfilled obligations." If the application is signed by the |
| 78 | applicant, it must be conclusively presumed that there was an |
| 79 | informed, knowing acceptance of the assessment liability that |
| 80 | exists as a result of participation in the fund. |
| 81 | Section 3. Subsection (6) of section 631.904, Florida |
| 82 | Statutes, is amended to read: |
| 83 | 631.904 Definitions.--As used in this part, the term: |
| 84 | (6) "Self-insurance fund" means a group self-insurance |
| 85 | fund authorized under s. 624.4621, a commercial self-insurance |
| 86 | fund writing workers' compensation insurance authorized under s. |
| 87 | 624.462, or an assessable mutual insurer authorized under s. |
| 88 | 628.6011. For purposes of this act, the term "self-insurance |
| 89 | fund" does not include a qualified local government self- |
| 90 | insurance fund, as defined in s. 624.4622, an independent |
| 91 | educational institution self-insurance fund as defined in s. |
| 92 | 624.4623, an electric cooperative self-insurance fund as |
| 93 | described in s. 624.4626, or an individual self-insurer as |
| 94 | defined in s. 440.385. |
| 95 | Section 4. This act shall take effect July 1, 2009. |