| 1 | A bill to be entitled |
| 2 | An act relating to commercial insurance; amending s. |
| 3 | 627.062, F.S.; exempting certain categories or types of |
| 4 | insurance and types of commercial lines risks from certain |
| 5 | filing and review requirements; requiring certain |
| 6 | information to be maintained by an insurer and subject to |
| 7 | examination by the Office of Insurance Regulation; |
| 8 | amending s. 627.0651, F.S.; excluding commercial motor |
| 9 | vehicle insurance from certain motor vehicle insurance |
| 10 | rate filing requirements; conforming cross-references; |
| 11 | providing an effective date. |
| 12 |
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| 13 | Be It Enacted by the Legislature of the State of Florida: |
| 14 |
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| 15 | Section 1. Paragraph (d) is added to subsection (3) of |
| 16 | section 627.062, Florida Statutes, to read: |
| 17 | 627.062 Rate standards.- |
| 18 | (3) |
| 19 | (d)1. The following categories or kinds of insurance and |
| 20 | types of commercial lines risks are not subject to the filing |
| 21 | and review requirements of subsection (2): |
| 22 | a. Excess or umbrella. |
| 23 | b. Surety and fidelity. |
| 24 | c. Boiler and machinery and leakage and fire extinguishing |
| 25 | equipment. |
| 26 | d. Commercial motor vehicle insurance. |
| 27 | e. Errors and omissions. |
| 28 | f. Professional liability, except medical malpractice |
| 29 | coverage. |
| 30 | g. Directors and officers, employment practices, and |
| 31 | management liability. |
| 32 | h. Intellectual property and patent infringement |
| 33 | liability. |
| 34 | i. Advertising injury and Internet liability insurance. |
| 35 | j. Property risks rated under a highly protected risks |
| 36 | rating plan. |
| 37 | k. Unique or unusual risks or portions of risks which are |
| 38 | not rated according to manuals, rating plans, or rate schedules, |
| 39 | including "a" rates. |
| 40 | l. Any other commercial lines categories or kinds of |
| 41 | insurance or types of commercial lines risks that the office |
| 42 | determines should not be subject to the filing and review |
| 43 | requirements of subsection (2) for reasons of the existence of a |
| 44 | competitive market for such insurance, similarity of such |
| 45 | insurance to other categories or kinds of insurance not subject |
| 46 | to filing and review requirements of subsection (2), or to |
| 47 | improve the general operational efficiency of the office. |
| 48 | 2. Underwriting files, premiums, losses, and expense |
| 49 | statistics with regard to risks written by an insurer not |
| 50 | subject to the filing and review requirements of subsection (2) |
| 51 | under this paragraph shall be maintained by the insurer and |
| 52 | subject to examination by the office. |
| 53 | Section 2. Subsections (1) and (11) of section 627.0651, |
| 54 | Florida Statutes, are amended to read: |
| 55 | 627.0651 Making and use of rates for motor vehicle |
| 56 | insurance.- |
| 57 | (1)(a) Insurers shall establish and use rates, rating |
| 58 | schedules, or rating manuals to allow the insurer a reasonable |
| 59 | rate of return on motor vehicle insurance written in this state. |
| 60 | A copy of rates, rating schedules, and rating manuals, and |
| 61 | changes therein, shall be filed with the office under one of the |
| 62 | following procedures: |
| 63 | 1.(a) If the filing is made at least 60 days before the |
| 64 | proposed effective date and the filing is not implemented during |
| 65 | the office's review of the filing and any proceeding and |
| 66 | judicial review, such filing shall be considered a "file and |
| 67 | use" filing. In such case, the office shall initiate proceedings |
| 68 | to disapprove the rate and so notify the insurer or shall |
| 69 | finalize its review within 60 days after receipt of the filing. |
| 70 | Notification to the insurer by the office of its preliminary |
| 71 | findings shall toll the 60-day period during any such |
| 72 | proceedings and subsequent judicial review. The rate shall be |
| 73 | deemed approved if the office does not issue notice to the |
| 74 | insurer of its preliminary findings within 60 days after the |
| 75 | filing. |
| 76 | 2.(b) If the filing is not made in accordance with the |
| 77 | provisions of subparagraph 1. paragraph (a), such filing shall |
| 78 | be made as soon as practicable, but no later than 30 days after |
| 79 | the effective date, and shall be considered a "use and file" |
| 80 | filing. An insurer making a "use and file" filing is potentially |
| 81 | subject to an order by the office to return to policyholders |
| 82 | portions of rates found to be excessive, as provided in |
| 83 | subsection (11). |
| 84 | (b) Commercial motor vehicle insurance is not subject to |
| 85 | the filing requirements of this subsection. |
| 86 | (11) In the event the office finds that a rate or rate |
| 87 | change is excessive, inadequate, or unfairly discriminatory, the |
| 88 | office shall issue an order of disapproval specifying that a new |
| 89 | rate or rate schedule which responds to the findings of the |
| 90 | office be filed by the insurer. The office shall further order |
| 91 | for any "use and file" filing made in accordance with |
| 92 | subparagraph (1)(a)2. paragraph (1)(b), that premiums charged |
| 93 | each policyholder constituting the portion of the rate above |
| 94 | that which was actuarially justified be returned to such |
| 95 | policyholder in the form of a credit or refund. If the office |
| 96 | finds that an insurer's rate or rate change is inadequate, the |
| 97 | new rate or rate schedule filed with the office in response to |
| 98 | such a finding shall be applicable only to new or renewal |
| 99 | business of the insurer written on or after the effective date |
| 100 | of the responsive filing. |
| 101 | Section 3. This act shall take effect January 1, 2011. |