Amendment
Bill No. CS/CS/CS/SB 408

Amendment No. 844961

CHAMBER ACTION
Senate		House
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1	Representative Wood offered the following:
2
3	Amendment (with title amendment)
4	Remove everything after the enacting clause and insert:
5	Section 1.  Subsection (2) of section 95.11, Florida
6	Statutes, is amended to read:
7	95.11  Limitations other than for the recovery of real
8	property.-Actions other than for recovery of real property shall
9	be commenced as follows:
10	(2)  WITHIN FIVE YEARS.-
11	(a)  An action on a judgment or decree of any court, not of
12	record, of this state or any court of the United States, any
13	other state or territory in the United States, or a foreign
14	country.
15	(b)  A legal or equitable action on a contract, obligation,
16	or liability founded on a written instrument, except for an
17	action to enforce a claim against a payment bond, which shall be
18	governed by the applicable provisions of ss. 255.05(10) and
19	713.23(1)(e).
20	(c)  An action to foreclose a mortgage.
21	(d)  An action alleging a willful violation of s. 448.110.
22	(e)  Notwithstanding paragraph (b), an action for breach of
23	a property insurance contract, with the period running from the
24	date of loss.
25	Section 2.  Effective June 1, 2011, paragraph (d) of
26	subsection (2) of section 215.555, Florida Statutes, is amended
27	to read:
28	215.555  Florida Hurricane Catastrophe Fund.-
29	(2)  DEFINITIONS.-As used in this section:
30	(d)  "Losses" means all direct incurred losses under
31	covered policies, including which shall include losses for
32	additional living expenses not to exceed 40 percent of the
33	insured value of a residential structure or its contents and
34	amounts paid as fees on behalf of or inuring to the benefit of a
35	policyholder shall exclude loss adjustment expenses. The term
36	"Losses" does not include:
37	1.  Losses for fair rental value, loss of rent or rental
38	income, or business interruption losses;
39	2.  Losses under liability coverages;
40	3.  Property losses that are proximately caused by any
41	peril other than a covered event, including, but not limited to,
42	fire, theft, flood or rising water, or windstorm that does not
43	constitute a covered event;
44	4.  Amounts paid as the result of a voluntary expansion of
45	coverage by the insurer, including, but not limited to, a waiver
46	of an applicable deductible;
47	5.  Amounts paid to reimburse a policyholder for
48	condominium association or homeowners' association loss
49	assessments or under similar coverages for contractual
50	liabilities;
51	6.  Amounts paid as bad faith awards, punitive damage
52	awards, or other court-imposed fines, sanctions, or penalties;
53	7.  Amounts in excess of the coverage limits under the
54	covered policy; or
55	8.  Allocated or unallocated loss adjustment expenses.
56	Section 3.  The amendment to s. 215.555, Florida Statutes,
57	made by this act applies first to the Florida Hurricane
58	Catastrophe Fund reimbursement contract that takes effect June
59	1, 2011.
60	Section 4.  Subsection (12) is added to section 215.5595,
61	Florida Statutes, to read:
62	215.5595  Insurance Capital Build-Up Incentive Program.-
63	(12)  The insurer may request that the board renegotiate
64	the terms of any surplus note issued under this section before
65	January 1, 2011. The request must be submitted to the board by
66	January 1, 2012. If the insurer agrees to accelerate the payment
67	period of the note by at least 5 years, the board must agree to
68	exempt the insurer from the premium-to-surplus ratios required
69	under paragraph (2)(d). If the insurer agrees to an acceleration
70	of the payment period for less than 5 years, the board may,
71	after consultation with the Office of Insurance Regulation,
72	agree to an appropriate revision of the premium-to-surplus
73	ratios required under paragraph (2)(d) for the remaining term of
74	the note if the revised ratios are not lower than a minimum
75	writing ratio of net premium to surplus of at least 1 to 1 and,
76	alternatively, a minimum writing ratio of gross premium to
77	surplus of at least 3 to 1.
78	Section 5.  Section 624.407, Florida Statutes, is amended
79	to read:
80	624.407  Surplus Capital funds required; new insurers.-
81	(1)  To receive authority to transact any one kind or
82	combinations of kinds of insurance, as defined in part V of this
83	chapter, an insurer applying for its original certificate of
84	authority in this state after the effective date of this section
85	shall possess surplus as to policyholders at least not less than
86	the greater of:
87	(a)  Five million dollars For a property and casualty
88	insurer, $5 million, or $2.5 million for any other insurer;
89	(b)  For life insurers, 4 percent of the insurer's total
90	liabilities;
91	(c)  For life and health insurers, 4 percent of the
92	insurer's total liabilities, plus 6 percent of the insurer's
93	liabilities relative to health insurance; or
94	(d)  For all insurers other than life insurers and life and
95	health insurers, 10 percent of the insurer's total liabilities;
96	or
97	(e)  Notwithstanding paragraph (a) or paragraph (d), for a
98	domestic insurer that transacts residential property insurance
99	and is:
100	1.  Not a wholly owned subsidiary of an insurer domiciled
101	in any other state, $15 million.
102	2.  however, a domestic insurer that transacts residential
103	property insurance and is A wholly owned subsidiary of an
104	insurer domiciled in any other state, shall possess surplus as
105	to policyholders of at least $50 million.
106	(2)  Notwithstanding subsection (1), a new insurer may not
107	be required, but no insurer shall be required under this
108	subsection to have surplus as to policyholders greater than $100
109	million.
110	(3)(2)  The requirements of this section shall be based
111	upon all the kinds of insurance actually transacted or to be
112	transacted by the insurer in any and all areas in which it
113	operates, whether or not only a portion of such kinds of
114	insurance are to be transacted in this state.
115	(4)(3)  As to surplus as to policyholders required for
116	qualification to transact one or more kinds of insurance,
117	domestic mutual insurers are governed by chapter 628, and
118	domestic reciprocal insurers are governed by chapter 629.
119	(5)(4)  For the purposes of this section, liabilities do
120	shall not include liabilities required under s. 625.041(4). For
121	purposes of computing minimum surplus as to policyholders
122	pursuant to s. 625.305(1), liabilities shall include liabilities
123	required under s. 625.041(4).
124	(5)  The provisions of this section, as amended by this
125	act, shall apply only to insurers applying for a certificate of
126	authority on or after the effective date of this act.
127	Section 6.  Section 624.408, Florida Statutes, is amended
128	to read:
129	624.408  Surplus as to policyholders required; current new
130	and existing insurers.-
131	(1)(a)  To maintain a certificate of authority to transact
132	any one kind or combinations of kinds of insurance, as defined
133	in part V of this chapter, an insurer in this state must shall
134	at all times maintain surplus as to policyholders at least not
135	less than the greater of:
136	(a)1.  Except as provided in paragraphs (e), (f), and (g)
137	subparagraph 5. and paragraph (b), $1.5 million.;
138	(b)2.  For life insurers, 4 percent of the insurer's total
139	liabilities.;
140	(c)3.  For life and health insurers, 4 percent of the
141	insurer's total liabilities plus 6 percent of the insurer's
142	liabilities relative to health insurance.; or
143	(d)4.  For all insurers other than mortgage guaranty
144	insurers, life insurers, and life and health insurers, 10
145	percent of the insurer's total liabilities.
146	(e)5.  For property and casualty insurers, $4 million,
147	except for property and casualty insurers authorized to
148	underwrite any line of residential property insurance.
149	(f)(b)  For residential any property insurers not and
150	casualty insurer holding a certificate of authority before July
151	1, 2011 on December 1, 1993, $15 million. the
152	(g)  For residential property insurers holding a
153	certificate of authority before July 1, 2011, and until June 30,
154	2016, $5 million; on or after July 1, 2016, and until June 30,
155	2021, $10 million; on or after July 1, 2021, $15 million.
156
157	The office may reduce the surplus requirement in paragraphs (f)
158	and (g) if the insurer is not writing new business, has premiums
159	in force of less than $1 million per year in residential
160	property insurance, or is a mutual insurance company. following
161	amounts apply instead of the $4 million required by subparagraph
162	(a)5.:
163	1.  On December 31, 2001, and until December 30, 2002, $3
164	million.
165	2.  On December 31, 2002, and until December 30, 2003,
166	$3.25 million.
167	3.  On December 31, 2003, and until December 30, 2004, $3.6
168	million.
169	4.  On December 31, 2004, and thereafter, $4 million.
170	(2)  For purposes of this section, liabilities do shall not
171	include liabilities required under s. 625.041(4). For purposes
172	of computing minimum surplus as to policyholders pursuant to s.
173	625.305(1), liabilities shall include liabilities required under
174	s. 625.041(4).
175	(3)  This section does not require an No insurer shall be
176	required under this section to have surplus as to policyholders
177	greater than $100 million.
178	(4)  A mortgage guaranty insurer shall maintain a minimum
179	surplus as required by s. 635.042.
180	Section 7.  Effective June 1, 2011, section 626.854,
181	Florida Statutes, is amended to read:
182	626.854  "Public adjuster" defined; prohibitions.-The
183	Legislature finds that it is necessary for the protection of the
184	public to regulate public insurance adjusters and to prevent the
185	unauthorized practice of law.
186	(1)  A "public adjuster" is any person, except a duly
187	licensed attorney at law as hereinafter in s. 626.860 provided,
188	who, for money, commission, or any other thing of value,
189	prepares, completes, or files an insurance claim form for an
190	insured or third-party claimant or who, for money, commission,
191	or any other thing of value, acts or aids in any manner on
192	behalf of an insured or third-party claimant in negotiating for
193	or effecting the settlement of a claim or claims for loss or
194	damage covered by an insurance contract or who advertises for
195	employment as an adjuster of such claims, and also includes any
196	person who, for money, commission, or any other thing of value,
197	solicits, investigates, or adjusts such claims on behalf of any
198	such public adjuster.
199	(2)  This definition does not apply to:
200	(a)  A licensed health care provider or employee thereof
201	who prepares or files a health insurance claim form on behalf of
202	a patient.
203	(b)  A person who files a health claim on behalf of another
204	and does so without compensation.
205	(3)  A public adjuster may not give legal advice. A public
206	adjuster may not act on behalf of or aid any person in
207	negotiating or settling a claim relating to bodily injury,
208	death, or noneconomic damages.
209	(4)  For purposes of this section, the term "insured"
210	includes only the policyholder and any beneficiaries named or
211	similarly identified in the policy.
212	(5)  A public adjuster may not directly or indirectly
213	through any other person or entity solicit an insured or
214	claimant by any means except on Monday through Saturday of each
215	week and only between the hours of 8 a.m. and 8 p.m. on those
216	days.
217	(6)  A public adjuster may not directly or indirectly
218	through any other person or entity initiate contact or engage in
219	face-to-face or telephonic solicitation or enter into a contract
220	with any insured or claimant under an insurance policy until at
221	least 48 hours after the occurrence of an event that may be the
222	subject of a claim under the insurance policy unless contact is
223	initiated by the insured or claimant.
224	(7)  An insured or claimant may cancel a public adjuster's
225	contract to adjust a claim without penalty or obligation within
226	3 business days after the date on which the contract is executed
227	or within 3 business days after the date on which the insured or
228	claimant has notified the insurer of the claim, by phone or in
229	writing, whichever is later. The public adjuster's contract
230	shall disclose to the insured or claimant his or her right to
231	cancel the contract and advise the insured or claimant that
232	notice of cancellation must be submitted in writing and sent by
233	certified mail, return receipt requested, or other form of
234	mailing which provides proof thereof, to the public adjuster at
235	the address specified in the contract; provided, during any
236	state of emergency as declared by the Governor and for a period
237	of 1 year after the date of loss, the insured or claimant shall
238	have 5 business days after the date on which the contract is
239	executed to cancel a public adjuster's contract.
240	(8)  It is an unfair and deceptive insurance trade practice
241	pursuant to s. 626.9541 for a public adjuster or any other
242	person to circulate or disseminate any advertisement,
243	announcement, or statement containing any assertion,
244	representation, or statement with respect to the business of
245	insurance which is untrue, deceptive, or misleading.
246	(9)  A public adjuster, a public adjuster apprentice, or
247	any person or entity acting on behalf of a public adjuster or
248	public adjuster apprentice may not give or offer to give a
249	monetary loan or advance to a client or prospective client.
250	(10)  A public adjuster, public adjuster apprentice, or any
251	individual or entity acting on behalf of a public adjuster or
252	public adjuster apprentice may not give or offer to give,
253	directly or indirectly, any article of merchandise having a
254	value in excess of $25 to any individual for the purpose of
255	advertising or as an inducement to entering into a contract with
256	a public adjuster.
257	(11)(a)  If a public adjuster enters into a contract with
258	an insured or claimant to reopen a claim or to file a
259	supplemental claim that seeks additional payments for a claim
260	that has been previously paid in part or in full or settled by
261	the insurer, the public adjuster may not charge, agree to, or
262	accept any compensation, payment, commission, fee, or other
263	thing of value based on a previous settlement or previous claim
264	payments by the insurer for the same cause of loss. The charge,
265	compensation, payment, commission, fee, or other thing of value
266	may be based only on the claim payments or settlement obtained
267	through the work of the public adjuster after entering into the
268	contract with the insured or claimant. Compensation for the
269	reopened or supplemental claim may not exceed 20 percent of the
270	reopened or supplemental claim payment. The contracts described
271	in this paragraph are not subject to the limitations in
272	paragraph (b).
273	(b)  A public adjuster may not charge, agree to, or accept
274	any compensation, payment, commission, fee, or other thing of
275	value in excess of:
276	1.  Ten percent of the amount of insurance claim payments
277	made by the insurer for claims based on events that are the
278	subject of a declaration of a state of emergency by the
279	Governor. This provision applies to claims made during the
280	period of 1 year after the declaration of emergency. After that
281	1-year period, 20 percent of the amount of insurance claim
282	payments made by the insurer.
283	2.  Twenty percent of the amount of all other insurance
284	claim payments made by the insurer for claims that are not based
285	on events that are the subject of a declaration of a state of
286	emergency by the Governor.
287	(12)  Each public adjuster shall provide to the claimant or
288	insured a written estimate of the loss to assist in the
289	submission of a proof of loss or any other claim for payment of
290	insurance proceeds. The public adjuster shall retain such
291	written estimate for at least 5 years and shall make such
292	estimate available to the claimant or insured and the department
293	upon request.
294	(13)  A public adjuster, public adjuster apprentice, or any
295	person acting on behalf of a public adjuster or apprentice may
296	not accept referrals of business from any person with whom the
297	public adjuster conducts business if there is any form or manner
298	of agreement to compensate the person, whether directly or
299	indirectly, for referring business to the public adjuster. A
300	public adjuster may not compensate any person, except for
301	another public adjuster, whether directly or indirectly, for the
302	principal purpose of referring business to the public adjuster.
303
304	The provisions of subsections (5)-(13) apply only to residential
305	property insurance policies and condominium unit owner
306	association policies as defined in s. 718.111(11).
307	Section 8.  Effective January 1, 2012, section 626.854,
308	Florida Statutes, as amended by this act, is amended to read:
309	626.854  "Public adjuster" defined; prohibitions.-The
310	Legislature finds that it is necessary for the protection of the
311	public to regulate public insurance adjusters and to prevent the
312	unauthorized practice of law.
313	(1)  A "public adjuster" is any person, except a duly
314	licensed attorney at law as exempted under hereinafter in s.
315	626.860 provided, who, for money, commission, or any other thing
316	of value, prepares, completes, or files an insurance claim form
317	for an insured or third-party claimant or who, for money,
318	commission, or any other thing of value, acts or aids in any
319	manner on behalf of, or aids an insured or third-party claimant
320	in negotiating for or effecting the settlement of a claim or
321	claims for loss or damage covered by an insurance contract or
322	who advertises for employment as an adjuster of such claims. The
323	term, and also includes any person who, for money, commission,
324	or any other thing of value, solicits, investigates, or adjusts
325	such claims on behalf of a any such public adjuster.
326	(2)  This definition does not apply to:
327	(a)  A licensed health care provider or employee thereof
328	who prepares or files a health insurance claim form on behalf of
329	a patient.
330	(b)  A person who files a health claim on behalf of another
331	and does so without compensation.
332	(3)  A public adjuster may not give legal advice or. A
333	public adjuster may not act on behalf of or aid any person in
334	negotiating or settling a claim relating to bodily injury,
335	death, or noneconomic damages.
336	(4)  For purposes of this section, the term "insured"
337	includes only the policyholder and any beneficiaries named or
338	similarly identified in the policy.
339	(5)  A public adjuster may not directly or indirectly
340	through any other person or entity solicit an insured or
341	claimant by any means except on Monday through Saturday of each
342	week and only between the hours of 8 a.m. and 8 p.m. on those
343	days.
344	(6)  A public adjuster may not directly or indirectly
345	through any other person or entity initiate contact or engage in
346	face-to-face or telephonic solicitation or enter into a contract
347	with any insured or claimant under an insurance policy until at
348	least 48 hours after the occurrence of an event that may be the
349	subject of a claim under the insurance policy unless contact is
350	initiated by the insured or claimant.
351	(7)  An insured or claimant may cancel a public adjuster's
352	contract to adjust a claim without penalty or obligation within
353	3 business days after the date on which the contract is executed
354	or within 3 business days after the date on which the insured or
355	claimant has notified the insurer of the claim, by phone or in
356	writing, whichever is later. The public adjuster's contract must
357	shall disclose to the insured or claimant his or her right to
358	cancel the contract and advise the insured or claimant that
359	notice of cancellation must be submitted in writing and sent by
360	certified mail, return receipt requested, or other form of
361	mailing that which provides proof thereof, to the public
362	adjuster at the address specified in the contract; provided,
363	during any state of emergency as declared by the Governor and
364	for a period of 1 year after the date of loss, the insured or
365	claimant has shall have 5 business days after the date on which
366	the contract is executed to cancel a public adjuster's contract.
367	(8)  It is an unfair and deceptive insurance trade practice
368	pursuant to s. 626.9541 for a public adjuster or any other
369	person to circulate or disseminate any advertisement,
370	announcement, or statement containing any assertion,
371	representation, or statement with respect to the business of
372	insurance which is untrue, deceptive, or misleading.
373	(a)  The following statements, made in any public
374	adjuster's advertisement or solicitation, are considered
375	deceptive or misleading:
376	1.  A statement or representation that invites an insured
377	policyholder to submit a claim when the policyholder does not
378	have covered damage to insured property.
379	2.  A statement or representation that invites an insured
380	policyholder to submit a claim by offering monetary or other
381	valuable inducement.
382	3.  A statement or representation that invites an insured
383	policyholder to submit a claim by stating that there is "no
384	risk" to the policyholder by submitting such claim.
385	4.  A statement or representation, or use of a logo or
386	shield, that implies or could mistakenly be construed to imply
387	that the solicitation was issued or distributed by a
388	governmental agency or is sanctioned or endorsed by a
389	governmental agency.
390	(b)  For purposes of this paragraph, the term "written
391	advertisement" includes only newspapers, magazines, flyers, and
392	bulk mailers. The following disclaimer, which is not required to
393	be printed on standard size business cards, must be added in
394	bold print and capital letters in typeface no smaller than the
395	typeface of the body of the text to all written advertisements
396	by a public adjuster:
397	"THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD
398	A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU
399	ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU
400	MAY DISREGARD THIS ADVERTISEMENT."
401
402	(9)  A public adjuster, a public adjuster apprentice, or
403	any person or entity acting on behalf of a public adjuster or
404	public adjuster apprentice may not give or offer to give a
405	monetary loan or advance to a client or prospective client.
406	(10)  A public adjuster, public adjuster apprentice, or any
407	individual or entity acting on behalf of a public adjuster or
408	public adjuster apprentice may not give or offer to give,
409	directly or indirectly, any article of merchandise having a
410	value in excess of $25 to any individual for the purpose of
411	advertising or as an inducement to entering into a contract with
412	a public adjuster.
413	(11)(a)  If a public adjuster enters into a contract with
414	an insured or claimant to reopen a claim or file a supplemental
415	claim that seeks additional payments for a claim that has been
416	previously paid in part or in full or settled by the insurer,
417	the public adjuster may not charge, agree to, or accept any
418	compensation, payment, commission, fee, or other thing of value
419	based on a previous settlement or previous claim payments by the
420	insurer for the same cause of loss. The charge, compensation,
421	payment, commission, fee, or other thing of value must be based
422	only on the claim payments or settlement obtained through the
423	work of the public adjuster after entering into the contract
424	with the insured or claimant. Compensation for the reopened or
425	supplemental claim may not exceed 20 percent of the reopened or
426	supplemental claim payment. The contracts described in this
427	paragraph are not subject to the limitations in paragraph (b).
428	(b)  A public adjuster may not charge, agree to, or accept
429	any compensation, payment, commission, fee, or other thing of
430	value in excess of:
431	1.  Ten percent of the amount of insurance claim payments
432	made by the insurer for claims based on events that are the
433	subject of a declaration of a state of emergency by the
434	Governor. This provision applies to claims made during the year
435	after the declaration of emergency. After that year, the
436	limitations in subparagraph 2. apply.
437	2.  Twenty percent of the amount of insurance claim
438	payments made by the insurer for claims that are not based on
439	events that are the subject of a declaration of a state of
440	emergency by the Governor.
441	(12)  Each public adjuster must shall provide to the
442	claimant or insured a written estimate of the loss to assist in
443	the submission of a proof of loss or any other claim for payment
444	of insurance proceeds. The public adjuster shall retain such
445	written estimate for at least 5 years and shall make the such
446	estimate available to the claimant or insured, the insurer, and
447	the department upon request.
448	(13)  A public adjuster, public adjuster apprentice, or any
449	person acting on behalf of a public adjuster or apprentice may
450	not accept referrals of business from any person with whom the
451	public adjuster conducts business if there is any form or manner
452	of agreement to compensate the person, whether directly or
453	indirectly, for referring business to the public adjuster. A
454	public adjuster may not compensate any person, except for
455	another public adjuster, whether directly or indirectly, for the
456	principal purpose of referring business to the public adjuster.
457	(14)  A company employee adjuster, independent adjuster,
458	attorney, investigator, or other persons acting on behalf of an
459	insurer that needs access to an insured or claimant or to the
460	insured property that is the subject of a claim must provide at
461	least 48 hours' notice to the insured or claimant, public
462	adjuster, or legal representative before scheduling a meeting
463	with the claimant or an onsite inspection of the insured
464	property. The insured or claimant may deny access to the
465	property if the notice has not been provided. The insured or
466	claimant may waive the 48-hour notice.
467	(15)  A public adjuster must ensure prompt notice of
468	property loss claims submitted to an insurer by or through a
469	public adjuster or on which a public adjuster represents the
470	insured at the time the claim or notice of loss is submitted to
471	the insurer. The public adjuster must ensure that notice is
472	given to the insurer, the public adjuster's contract is provided
473	to the insurer, the property is available for inspection of the
474	loss or damage by the insurer, and the insurer is given an
475	opportunity to interview the insured directly about the loss and
476	claim. The insurer must be allowed to obtain necessary
477	information to investigate and respond to the claim.
478	(a)  The insurer may not exclude the public adjuster from
479	its in-person meetings with the insured. The insurer shall meet
480	or communicate with the public adjuster in an effort to reach
481	agreement as to the scope of the covered loss under the
482	insurance policy. This section does not impair the terms and
483	conditions of the insurance policy in effect at the time the
484	claim is filed.
485	(b)  A public adjuster may not restrict or prevent an
486	insurer, company employee adjuster, independent adjuster,
487	attorney, investigator, or other person acting on behalf of the
488	insurer from having reasonable access at reasonable times to an
489	insured or claimant or to the insured property that is the
490	subject of a claim.
491	(c)  A public adjuster may not act or fail to reasonably
492	act in any manner that obstructs or prevents an insurer or
493	insurer's adjuster from timely conducting an inspection of any
494	part of the insured property for which there is a claim for loss
495	or damage. The public adjuster representing the insured may be
496	present for the insurer's inspection, but if the unavailability
497	of the public adjuster otherwise delays the insurer's timely
498	inspection of the property, the public adjuster or the insured
499	must allow the insurer to have access to the property without
500	the participation or presence of the public adjuster or insured
501	in order to facilitate the insurer's prompt inspection of the
502	loss or damage.
503	(16)  A licensed contractor under part I of chapter 489, or
504	a subcontractor, may not adjust a claim on behalf of an insured
505	unless licensed and compliant as a public adjuster under this
506	chapter. However, the contractor may discuss or explain a bid
507	for construction or repair of covered property with the
508	residential property owner who has suffered loss or damage
509	covered by a property insurance policy, or the insurer of such
510	property, if the contractor is doing so for the usual and
511	customary fees applicable to the work to be performed as stated
512	in the contract between the contractor and the insured.
513	(17)  The provisions of subsections (5)-(16) (5)-(13) apply
514	only to residential property insurance policies and condominium
515	unit owner policies as defined in s. 718.111(11).
516	Section 9.  Effective January 1, 2012, section 626.8796,
517	Florida Statutes, is amended to read:
518	626.8796  Public adjuster contracts; fraud statement.-
519	(1)  All contracts for public adjuster services must be in
520	writing and must prominently display the following statement on
521	the contract: "Pursuant to s. 817.234, Florida Statutes, any
522	person who, with the intent to injure, defraud, or deceive an
523	any insurer or insured, prepares, presents, or causes to be
524	presented a proof of loss or estimate of cost or repair of
525	damaged property in support of a claim under an insurance policy
526	knowing that the proof of loss or estimate of claim or repairs
527	contains any false, incomplete, or misleading information
528	concerning any fact or thing material to the claim commits a
529	felony of the third degree, punishable as provided in s.
530	775.082, s. 775.083, or s. 775.084, Florida Statutes."
531	(2)  A public adjuster contract relating to a property and
532	casualty claim must contain the full name, permanent business
533	address, and license number of the public adjuster; the full
534	name of the public adjusting firm; and the insured's full name
535	and street address, together with a brief description of the
536	loss. The contract must state the percentage of compensation for
537	the public adjuster's services; the type of claim, including an
538	emergency claim, nonemergency claim, or supplemental claim; the
539	signatures of the public adjuster and all named insureds; and
540	the signature date. If all of the named insureds signatures are
541	not available, the public adjuster must submit an affidavit
542	signed by the available named insureds attesting that they have
543	authority to enter into the contract and settle all claim issues
544	on behalf of the named insureds. An unaltered copy of the
545	executed contract must be remitted to the insurer within 30 days
546	after execution.
547	Section 10.  Effective June 1, 2011, section 626.70132,
548	Florida Statutes, is created to read:
549	626.70132  Notice of windstorm or hurricane claim.-A claim,
550	supplemental claim, or reopened claim under an insurance policy
551	that provides property insurance, as defined in s. 624.604, for
552	loss or damage caused by the peril of windstorm or hurricane is
553	barred unless notice of the claim, supplemental claim, or
554	reopened claim was given to the insurer in accordance with the
555	terms of the policy within 3 years after the hurricane first
556	made landfall or the windstorm caused the covered damage. For
557	purposes of this section, the term "supplemental claim" or
558	"reopened claim" means any additional claim for recovery from
559	the insurer for losses from the same hurricane or windstorm
560	which the insurer has previously adjusted pursuant to the
561	initial claim. This section does not affect any applicable
562	limitation on civil actions provided in s. 95.11 for claims,
563	supplemental claims, or reopened claims timely filed under this
564	section.
565	Section 11.  Subsection (4) of section 627.0613, Florida
566	Statutes, is repealed.
567	Section 12.  Section 627.062, Florida Statutes, is amended
568	to read:
569	627.062  Rate standards.-
570	(1)  The rates for all classes of insurance to which the
571	provisions of this part are applicable may shall not be
572	excessive, inadequate, or unfairly discriminatory.
573	(2)  As to all such classes of insurance:
574	(a)  Insurers or rating organizations shall establish and
575	use rates, rating schedules, or rating manuals that to allow the
576	insurer a reasonable rate of return on the such classes of
577	insurance written in this state. A copy of rates, rating
578	schedules, rating manuals, premium credits or discount
579	schedules, and surcharge schedules, and changes thereto, must
580	shall be filed with the office under one of the following
581	procedures except as provided in subparagraph 3.:
582	1.  If the filing is made at least 90 days before the
583	proposed effective date and the filing is not implemented during
584	the office's review of the filing and any proceeding and
585	judicial review, then such filing is shall be considered a "file
586	and use" filing. In such case, the office shall finalize its
587	review by issuance of a notice of intent to approve or a notice
588	of intent to disapprove within 90 days after receipt of the
589	filing. The notice of intent to approve and the notice of intent
590	to disapprove constitute agency action for purposes of the
591	Administrative Procedure Act. Requests for supporting
592	information, requests for mathematical or mechanical
593	corrections, or notification to the insurer by the office of its
594	preliminary findings does shall not toll the 90-day period
595	during any such proceedings and subsequent judicial review. The
596	rate shall be deemed approved if the office does not issue a
597	notice of intent to approve or a notice of intent to disapprove
598	within 90 days after receipt of the filing.
599	2.  If the filing is not made in accordance with the
600	provisions of subparagraph 1., such filing must shall be made as
601	soon as practicable, but within no later than 30 days after the
602	effective date, and is shall be considered a "use and file"
603	filing. An insurer making a "use and file" filing is potentially
604	subject to an order by the office to return to policyholders
605	those portions of rates found to be excessive, as provided in
606	paragraph (h).
607	3.  For all property insurance filings made or submitted
608	after January 25, 2007, but before May 1, 2012 December 31,
609	2010, an insurer seeking a rate that is greater than the rate
610	most recently approved by the office shall make a "file and use"
611	filing. For purposes of this subparagraph, motor vehicle
612	collision and comprehensive coverages are not considered to be
613	property coverages.
614	(b)  Upon receiving a rate filing, the office shall review
615	the rate filing to determine if a rate is excessive, inadequate,
616	or unfairly discriminatory. In making that determination, the
617	office shall, in accordance with generally accepted and
618	reasonable actuarial techniques, consider the following factors:
619	1.  Past and prospective loss experience within and without
620	this state.
621	2.  Past and prospective expenses.
622	3.  The degree of competition among insurers for the risk
623	insured.
624	4.  Investment income reasonably expected by the insurer,
625	consistent with the insurer's investment practices, from
626	investable premiums anticipated in the filing, plus any other
627	expected income from currently invested assets representing the
628	amount expected on unearned premium reserves and loss reserves.
629	The commission may adopt rules using reasonable techniques of
630	actuarial science and economics to specify the manner in which
631	insurers shall calculate investment income attributable to such
632	classes of insurance written in this state and the manner in
633	which such investment income is shall be used to calculate
634	insurance rates. Such manner must shall contemplate allowances
635	for an underwriting profit factor and full consideration of
636	investment income which produce a reasonable rate of return;
637	however, investment income from invested surplus may not be
638	considered.
639	5.  The reasonableness of the judgment reflected in the
640	filing.
641	6.  Dividends, savings, or unabsorbed premium deposits
642	allowed or returned to Florida policyholders, members, or
643	subscribers.
644	7.  The adequacy of loss reserves.
645	8.  The cost of reinsurance. The office may shall not
646	disapprove a rate as excessive solely due to the insurer having
647	obtained catastrophic reinsurance to cover the insurer's
648	estimated 250-year probable maximum loss or any lower level of
649	loss.
650	9.  Trend factors, including trends in actual losses per
651	insured unit for the insurer making the filing.
652	10.  Conflagration and catastrophe hazards, if applicable.
653	11.  Projected hurricane losses, if applicable, which must
654	be estimated using a model or method found to be acceptable or
655	reliable by the Florida Commission on Hurricane Loss Projection
656	Methodology, and as further provided in s. 627.0628.
657	12.  A reasonable margin for underwriting profit and
658	contingencies.
659	13.  The cost of medical services, if applicable.
660	14.  Other relevant factors that affect which impact upon
661	the frequency or severity of claims or upon expenses.
662	(c)  In the case of fire insurance rates, consideration
663	must shall be given to the availability of water supplies and
664	the experience of the fire insurance business during a period of
665	not less than the most recent 5-year period for which such
666	experience is available.
667	(d)  If conflagration or catastrophe hazards are considered
668	given consideration by an insurer in its rates or rating plan,
669	including surcharges and discounts, the insurer shall establish
670	a reserve for that portion of the premium allocated to such
671	hazard and shall maintain the premium in a catastrophe reserve.
672	Any Removal of such premiums from the reserve for purposes other
673	than paying claims associated with a catastrophe or purchasing
674	reinsurance for catastrophes must be approved by shall be
675	subject to approval of the office. Any ceding commission
676	received by an insurer purchasing reinsurance for catastrophes
677	must shall be placed in the catastrophe reserve.
678	(e)  After consideration of the rate factors provided in
679	paragraphs (b), (c), and (d), the office may find a rate may be
680	found by the office to be excessive, inadequate, or unfairly
681	discriminatory based upon the following standards:
682	1.  Rates shall be deemed excessive if they are likely to
683	produce a profit from Florida business which that is
684	unreasonably high in relation to the risk involved in the class
685	of business or if expenses are unreasonably high in relation to
686	services rendered.
687	2.  Rates shall be deemed excessive if, among other things,
688	the rate structure established by a stock insurance company
689	provides for replenishment of surpluses from premiums, if when
690	the replenishment is attributable to investment losses.
691	3.  Rates shall be deemed inadequate if they are clearly
692	insufficient, together with the investment income attributable
693	to them, to sustain projected losses and expenses in the class
694	of business to which they apply.
695	4.  A rating plan, including discounts, credits, or
696	surcharges, shall be deemed unfairly discriminatory if it fails
697	to clearly and equitably reflect consideration of the
698	policyholder's participation in a risk management program
699	adopted pursuant to s. 627.0625.
700	5.  A rate shall be deemed inadequate as to the premium
701	charged to a risk or group of risks if discounts or credits are
702	allowed which exceed a reasonable reflection of expense savings
703	and reasonably expected loss experience from the risk or group
704	of risks.
705	6.  A rate shall be deemed unfairly discriminatory as to a
706	risk or group of risks if the application of premium discounts,
707	credits, or surcharges among such risks does not bear a
708	reasonable relationship to the expected loss and expense
709	experience among the various risks.
710	(f)  In reviewing a rate filing, the office may require the
711	insurer to provide, at the insurer's expense, all information
712	necessary to evaluate the condition of the company and the
713	reasonableness of the filing according to the criteria
714	enumerated in this section.
715	(g)  The office may at any time review a rate, rating
716	schedule, rating manual, or rate change; the pertinent records
717	of the insurer; and market conditions. If the office finds on a
718	preliminary basis that a rate may be excessive, inadequate, or
719	unfairly discriminatory, the office shall initiate proceedings
720	to disapprove the rate and shall so notify the insurer. However,
721	the office may not disapprove as excessive any rate for which it
722	has given final approval or which has been deemed approved for a
723	period of 1 year after the effective date of the filing unless
724	the office finds that a material misrepresentation or material
725	error was made by the insurer or was contained in the filing.
726	Upon being so notified, the insurer or rating organization
727	shall, within 60 days, file with the office all information that
728	which, in the belief of the insurer or organization, proves the
729	reasonableness, adequacy, and fairness of the rate or rate
730	change. The office shall issue a notice of intent to approve or
731	a notice of intent to disapprove pursuant to the procedures of
732	paragraph (a) within 90 days after receipt of the insurer's
733	initial response. In such instances and in any administrative
734	proceeding relating to the legality of the rate, the insurer or
735	rating organization shall carry the burden of proof by a
736	preponderance of the evidence to show that the rate is not
737	excessive, inadequate, or unfairly discriminatory. After the
738	office notifies an insurer that a rate may be excessive,
739	inadequate, or unfairly discriminatory, unless the office
740	withdraws the notification, the insurer may shall not alter the
741	rate except to conform to with the office's notice until the
742	earlier of 120 days after the date the notification was provided
743	or 180 days after the date of implementing the implementation of
744	the rate. The office may, subject to chapter 120, may disapprove
745	without the 60-day notification any rate increase filed by an
746	insurer within the prohibited time period or during the time
747	that the legality of the increased rate is being contested.
748	(h)  If In the event the office finds that a rate or rate
749	change is excessive, inadequate, or unfairly discriminatory, the
750	office shall issue an order of disapproval specifying that a new
751	rate or rate schedule, which responds to the findings of the
752	office, be filed by the insurer. The office shall further order,
753	for any "use and file" filing made in accordance with
754	subparagraph (a)2., that premiums charged each policyholder
755	constituting the portion of the rate above that which was
756	actuarially justified be returned to the such policyholder in
757	the form of a credit or refund. If the office finds that an
758	insurer's rate or rate change is inadequate, the new rate or
759	rate schedule filed with the office in response to such a
760	finding is shall be applicable only to new or renewal business
761	of the insurer written on or after the effective date of the
762	responsive filing.
763	(i)  Except as otherwise specifically provided in this
764	chapter, for property and casualty insurance the office may
765	shall not directly or indirectly:
766	1.  Prohibit any insurer, including any residual market
767	plan or joint underwriting association, from paying acquisition
768	costs based on the full amount of premium, as defined in s.
769	627.403, applicable to any policy, or prohibit any such insurer
770	from including the full amount of acquisition costs in a rate
771	filing; or.
772	2.  Impede, abridge, or otherwise compromise an insurer's
773	right to acquire policyholders, advertise, or appoint agents,
774	including the calculation, manner, or amount of such agent
775	commissions, if any.
776	(j)  With respect to residential property insurance rate
777	filings, the rate filing must account for mitigation measures
778	undertaken by policyholders to reduce hurricane losses.
779	(k)1.  A residential property An insurer may make a
780	separate filing limited solely to an adjustment of its rates for
781	reinsurance, the cost of financing products used as a
782	replacement for reinsurance, or financing costs incurred in the
783	purchase of reinsurance, or financing products to replace or
784	finance the payment of the amount covered by the Temporary
785	Increase in Coverage Limits (TICL) portion of the Florida
786	Hurricane Catastrophe Fund including replacement reinsurance for
787	the TICL reductions made pursuant to s. 215.555(17)(e); the
788	actual cost paid due to the application of the TICL premium
789	factor pursuant to s. 215.555(17)(f); and the actual cost paid
790	due to the application of the cash build-up factor pursuant to
791	s. 215.555(5)(b) if the insurer:
792	a.  Elects to purchase financing products such as a
793	liquidity instrument or line of credit, in which case the cost
794	included in the filing for the liquidity instrument or line of
795	credit may not result in a premium increase exceeding 3 percent
796	for any individual policyholder. All costs contained in the
797	filing may not result in an overall premium increase of more
798	than 15 10 percent for any individual policyholder.
799	b.  Includes in the filing a copy of all of its
800	reinsurance, liquidity instrument, or line of credit contracts;
801	proof of the billing or payment for the contracts; and the
802	calculation upon which the proposed rate change is based
803	demonstrating demonstrates that the costs meet the criteria of
804	this section and are not loaded for expenses or profit for the
805	insurer making the filing.
806	c.  Includes no other changes to its rates in the filing.
807	d.  Has not implemented a rate increase within the 6 months
808	immediately preceding the filing.
809	e.  Does not file for a rate increase under any other
810	paragraph within 6 months after making a filing under this
811	paragraph.
812	2.f.  An insurer that purchases reinsurance or financing
813	products from an affiliated company may make a separate filing
814	in compliance with this paragraph does so only if the costs for
815	such reinsurance or financing products are charged at or below
816	charges made for comparable coverage by nonaffiliated reinsurers
817	or financial entities making such coverage or financing products
818	available in this state.
819	3.2.  An insurer may only make only one filing per in any
820	12-month period under this paragraph.
821	4.3.  An insurer that elects to implement a rate change
822	under this paragraph must file its rate filing with the office
823	at least 45 days before the effective date of the rate change.
824	After an insurer submits a complete filing that meets all of the
825	requirements of this paragraph, the office has 45 days after the
826	date of the filing to review the rate filing and determine if
827	the rate is excessive, inadequate, or unfairly discriminatory.
828
829	The provisions of this subsection do shall not apply to workers'
830	compensation, and employer's liability insurance, and to motor
831	vehicle insurance.
832	(3)(a)  For individual risks that are not rated in
833	accordance with the insurer's rates, rating schedules, rating
834	manuals, and underwriting rules filed with the office and that
835	which have been submitted to the insurer for individual rating,
836	the insurer must maintain documentation on each risk subject to
837	individual risk rating. The documentation must identify the
838	named insured and specify the characteristics and classification
839	of the risk supporting the reason for the risk being
840	individually risk rated, including any modifications to existing
841	approved forms to be used on the risk. The insurer must maintain
842	these records for a period of at least 5 years after the
843	effective date of the policy.
844	(b)  Individual risk rates and modifications to existing
845	approved forms are not subject to this part or part II, except
846	for paragraph (a) and ss. 627.402, 627.403, 627.4035, 627.404,
847	627.405, 627.406, 627.407, 627.4085, 627.409, 627.4132,
848	627.4133, 627.415, 627.416, 627.417, 627.419, 627.425, 627.426,
849	627.4265, 627.427, and 627.428, but are subject to all other
850	applicable provisions of this code and rules adopted thereunder.
851	(c)  This subsection does not apply to private passenger
852	motor vehicle insurance.
853	(d)1.  The following categories or kinds of insurance and
854	types of commercial lines risks are not subject to paragraph
855	(2)(a) or paragraph (2)(f):
856	a.  Excess or umbrella.
857	b.  Surety and fidelity.
858	c.  Boiler and machinery and leakage and fire extinguishing
859	equipment.
860	d.  Errors and omissions.
861	e.  Directors and officers, employment practices, and
862	management liability.
863	f.  Intellectual property and patent infringement
864	liability.
865	g.  Advertising injury and Internet liability insurance.
866	h.  Property risks rated under a highly protected risks
867	rating plan.
868	i.  Any other commercial lines categories or kinds of
869	insurance or types of commercial lines risks that the office
870	determines should not be subject to paragraph (2)(a) or
871	paragraph (2)(f) because of the existence of a competitive
872	market for such insurance, similarity of such insurance to other
873	categories or kinds of insurance not subject to paragraph (2)(a)
874	or paragraph (2)(f), or to improve the general operational
875	efficiency of the office.
876	2.  Insurers or rating organizations shall establish and
877	use rates, rating schedules, or rating manuals to allow the
878	insurer a reasonable rate of return on insurance and risks
879	described in subparagraph 1. which are written in this state.
880	3.  An insurer must notify the office of any changes to
881	rates for insurance and risks described in subparagraph 1.
882	within no later than 30 days after the effective date of the
883	change. The notice must include the name of the insurer, the
884	type or kind of insurance subject to rate change, total premium
885	written during the immediately preceding year by the insurer for
886	the type or kind of insurance subject to the rate change, and
887	the average statewide percentage change in rates. Underwriting
888	files, premiums, losses, and expense statistics with regard to
889	such insurance and risks described in subparagraph 1. written by
890	an insurer must shall be maintained by the insurer and subject
891	to examination by the office. Upon examination, the office
892	shall, in accordance with generally accepted and reasonable
893	actuarial techniques, shall consider the rate factors in
894	paragraphs (2)(b), (c), and (d) and the standards in paragraph
895	(2)(e) to determine if the rate is excessive, inadequate, or
896	unfairly discriminatory.
897	4.  A rating organization must notify the office of any
898	changes to loss cost for insurance and risks described in
899	subparagraph 1. within no later than 30 days after the effective
900	date of the change. The notice must include the name of the
901	rating organization, the type or kind of insurance subject to a
902	loss cost change, loss costs during the immediately preceding
903	year for the type or kind of insurance subject to the loss cost
904	change, and the average statewide percentage change in loss
905	cost. Loss and exposure statistics with regard to risks
906	applicable to loss costs for a rating organization not subject
907	to paragraph (2)(a) or paragraph (2)(f) must shall be maintained
908	by the rating organization and are subject to examination by the
909	office. Upon examination, the office shall, in accordance with
910	generally accepted and reasonable actuarial techniques, shall
911	consider the rate factors in paragraphs (2)(b)-(d) and the
912	standards in paragraph (2)(e) to determine if the rate is
913	excessive, inadequate, or unfairly discriminatory.
914	5.  In reviewing a rate, the office may require the insurer
915	to provide, at the insurer's expense, all information necessary
916	to evaluate the condition of the company and the reasonableness
917	of the rate according to the applicable criteria described in
918	this section.
919	(4)  The establishment of any rate, rating classification,
920	rating plan or schedule, or variation thereof in violation of
921	part IX of chapter 626 is also in violation of this section. In
922	order to enhance the ability of consumers to compare premiums
923	and to increase the accuracy and usefulness of rate-comparison
924	information provided by the office to the public, the office
925	shall develop a proposed standard rating territory plan to be
926	used by all authorized property and casualty insurers for
927	residential property insurance. In adopting the proposed plan,
928	the office may consider geographical characteristics relevant to
929	risk, county lines, major roadways, existing rating territories
930	used by a significant segment of the market, and other relevant
931	factors. Such plan shall be submitted to the President of the
932	Senate and the Speaker of the House of Representatives by
933	January 15, 2006. The plan may not be implemented unless
934	authorized by further act of the Legislature.
935	(5)  With respect to a rate filing involving coverage of
936	the type for which the insurer is required to pay a
937	reimbursement premium to the Florida Hurricane Catastrophe Fund,
938	the insurer may fully recoup in its property insurance premiums
939	any reimbursement premiums paid to the Florida Hurricane
940	Catastrophe fund, together with reasonable costs of other
941	reinsurance; however, but except as otherwise provided in this
942	section, the insurer may not recoup reinsurance costs that
943	duplicate coverage provided by the Florida Hurricane Catastrophe
944	fund. An insurer may not recoup more than 1 year of
945	reimbursement premium at a time. Any under-recoupment from the
946	prior year may be added to the following year's reimbursement
947	premium, and any over-recoupment must shall be subtracted from
948	the following year's reimbursement premium.
949	(6)(a)  If an insurer requests an administrative hearing
950	pursuant to s. 120.57 related to a rate filing under this
951	section, the director of the Division of Administrative Hearings
952	shall expedite the hearing and assign an administrative law
953	judge who shall commence the hearing within 30 days after the
954	receipt of the formal request and shall enter a recommended
955	order within 30 days after the hearing or within 30 days after
956	receipt of the hearing transcript by the administrative law
957	judge, whichever is later. Each party shall have be allowed 10
958	days in which to submit written exceptions to the recommended
959	order. The office shall enter a final order within 30 days after
960	the entry of the recommended order. The provisions of this
961	paragraph may be waived upon stipulation of all parties.
962	(b)  Upon entry of a final order, the insurer may request a
963	expedited appellate review pursuant to the Florida Rules of
964	Appellate Procedure. It is the intent of the Legislature that
965	the First District Court of Appeal grant an insurer's request
966	for an expedited appellate review.
967	(7)(a)  The provisions of this subsection apply only with
968	respect to rates for medical malpractice insurance and shall
969	control to the extent of any conflict with other provisions of
970	this section.
971	(a)(b)  Any portion of a judgment entered or settlement
972	paid as a result of a statutory or common-law bad faith action
973	and any portion of a judgment entered which awards punitive
974	damages against an insurer may not be included in the insurer's
975	rate base, and shall not be used to justify a rate or rate
976	change. Any common-law bad faith action identified as such, any
977	portion of a settlement entered as a result of a statutory or
978	common-law action, or any portion of a settlement wherein an
979	insurer agrees to pay specific punitive damages may not be used
980	to justify a rate or rate change. The portion of the taxable
981	costs and attorney's fees which is identified as being related
982	to the bad faith and punitive damages in these judgments and
983	settlements may not be included in the insurer's rate base and
984	used may not be utilized to justify a rate or rate change.
985	(b)(c)  Upon reviewing a rate filing and determining
986	whether the rate is excessive, inadequate, or unfairly
987	discriminatory, the office shall consider, in accordance with
988	generally accepted and reasonable actuarial techniques, past and
989	present prospective loss experience, either using loss
990	experience solely for this state or giving greater credibility
991	to this state's loss data after applying actuarially sound
992	methods of assigning credibility to such data.
993	(c)(d)  Rates shall be deemed excessive if, among other
994	standards established by this section, the rate structure
995	provides for replenishment of reserves or surpluses from
996	premiums when the replenishment is attributable to investment
997	losses.
998	(d)(e)  The insurer must apply a discount or surcharge
999	based on the health care provider's loss experience or shall
1000	establish an alternative method giving due consideration to the
1001	provider's loss experience. The insurer must include in the
1002	filing a copy of the surcharge or discount schedule or a
1003	description of the alternative method used, and must provide a
1004	copy of such schedule or description, as approved by the office,
1005	to policyholders at the time of renewal and to prospective
1006	policyholders at the time of application for coverage.
1007	(e)(f)  Each medical malpractice insurer must make a rate
1008	filing under this section, sworn to by at least two executive
1009	officers of the insurer, at least once each calendar year.
1010	(8)(a)1.  No later than 60 days after the effective date of
1011	medical malpractice legislation enacted during the 2003 Special
1012	Session D of the Florida Legislature, the office shall calculate
1013	a presumed factor that reflects the impact that the changes
1014	contained in such legislation will have on rates for medical
1015	malpractice insurance and shall issue a notice informing all
1016	insurers writing medical malpractice coverage of such presumed
1017	factor. In determining the presumed factor, the office shall use
1018	generally accepted actuarial techniques and standards provided
1019	in this section in determining the expected impact on losses,
1020	expenses, and investment income of the insurer. To the extent
1021	that the operation of a provision of medical malpractice
1022	legislation enacted during the 2003 Special Session D of the
1023	Florida Legislature is stayed pending a constitutional
1024	challenge, the impact of that provision shall not be included in
1025	the calculation of a presumed factor under this subparagraph.
1026	2.  No later than 60 days after the office issues its
1027	notice of the presumed rate change factor under subparagraph 1.,
1028	each insurer writing medical malpractice coverage in this state
1029	shall submit to the office a rate filing for medical malpractice
1030	insurance, which will take effect no later than January 1, 2004,
1031	and apply retroactively to policies issued or renewed on or
1032	after the effective date of medical malpractice legislation
1033	enacted during the 2003 Special Session D of the Florida
1034	Legislature. Except as authorized under paragraph (b), the
1035	filing shall reflect an overall rate reduction at least as great
1036	as the presumed factor determined under subparagraph 1. With
1037	respect to policies issued on or after the effective date of
1038	such legislation and prior to the effective date of the rate
1039	filing required by this subsection, the office shall order the
1040	insurer to make a refund of the amount that was charged in
1041	excess of the rate that is approved.
1042	(b)  Any insurer or rating organization that contends that
1043	the rate provided for in paragraph (a) is excessive, inadequate,
1044	or unfairly discriminatory shall separately state in its filing
1045	the rate it contends is appropriate and shall state with
1046	specificity the factors or data that it contends should be
1047	considered in order to produce such appropriate rate. The
1048	insurer or rating organization shall be permitted to use all of
1049	the generally accepted actuarial techniques provided in this
1050	section in making any filing pursuant to this subsection. The
1051	office shall review each such exception and approve or
1052	disapprove it prior to use. It shall be the insurer's burden to
1053	actuarially justify any deviations from the rates required to be
1054	filed under paragraph (a). The insurer making a filing under
1055	this paragraph shall include in the filing the expected impact
1056	of medical malpractice legislation enacted during the 2003
1057	Special Session D of the Florida Legislature on losses,
1058	expenses, and rates.
1059	(c)  If any provision of medical malpractice legislation
1060	enacted during the 2003 Special Session D of the Florida
1061	Legislature is held invalid by a court of competent
1062	jurisdiction, the office shall permit an adjustment of all
1063	medical malpractice rates filed under this section to reflect
1064	the impact of such holding on such rates so as to ensure that
1065	the rates are not excessive, inadequate, or unfairly
1066	discriminatory.
1067	(d)  Rates approved on or before July 1, 2003, for medical
1068	malpractice insurance shall remain in effect until the effective
1069	date of a new rate filing approved under this subsection.
1070	(e)  The calculation and notice by the office of the
1071	presumed factor pursuant to paragraph (a) is not an order or
1072	rule that is subject to chapter 120. If the office enters into a
1073	contract with an independent consultant to assist the office in
1074	calculating the presumed factor, such contract shall not be
1075	subject to the competitive solicitation requirements of s.
1076	287.057.
1077	(8)(9)(a)  The chief executive officer or chief financial
1078	officer of a property insurer and the chief actuary of a
1079	property insurer must certify under oath and subject to the
1080	penalty of perjury, on a form approved by the commission, the
1081	following information, which must accompany a rate filing:
1082	1.  The signing officer and actuary have reviewed the rate
1083	filing;
1084	2.  Based on the signing officer's and actuary's knowledge,
1085	the rate filing does not contain any untrue statement of a
1086	material fact or omit to state a material fact necessary in
1087	order to make the statements made, in light of the circumstances
1088	under which such statements were made, not misleading;
1089	3.  Based on the signing officer's and actuary's knowledge,
1090	the information and other factors described in paragraph (2)(b),
1091	including, but not limited to, investment income, fairly present
1092	in all material respects the basis of the rate filing for the
1093	periods presented in the filing; and
1094	4.  Based on the signing officer's and actuary's knowledge,
1095	the rate filing reflects all premium savings that are reasonably
1096	expected to result from legislative enactments and are in
1097	accordance with generally accepted and reasonable actuarial
1098	techniques.
1099	(b)  A signing officer or actuary who knowingly makes
1100	making a false certification under this subsection commits a
1101	violation of s. 626.9541(1)(e) and is subject to the penalties
1102	under s. 626.9521.
1103	(c)  Failure to provide such certification by the officer
1104	and actuary shall result in the rate filing being disapproved
1105	without prejudice to be refiled.
1106	(d)  The certification made pursuant to paragraph (a) is
1107	not rendered false if, after making the subject rate filing, the
1108	insurer provides the office with additional or supplementary
1109	information pursuant to a formal or informal request from the
1110	office. However, the actuary who is primarily responsible for
1111	preparing and submitting such information must certify the
1112	information in accordance with the certification required under
1113	paragraph (a) and the penalties in paragraph (b), except that
1114	the chief executive officer, chief financial officer, or chief
1115	actuary need not certify the additional or supplementary
1116	information.
1117	(e)(d)  The commission may adopt rules and forms pursuant
1118	to ss. 120.536(1) and 120.54 to administer this subsection.
1119	(9)(10)  The burden is on the office to establish that
1120	rates are excessive for personal lines residential coverage with
1121	a dwelling replacement cost of $1 million or more or for a
1122	single condominium unit with a combined dwelling and contents
1123	replacement cost of $1 million or more. Upon request of the
1124	office, the insurer shall provide to the office such loss and
1125	expense information as the office reasonably needs to meet this
1126	burden.
1127	(10)(11)  Any interest paid pursuant to s. 627.70131(5) may
1128	not be included in the insurer's rate base and may not be used
1129	to justify a rate or rate change.
1130	Section 13.  Paragraph (b) of subsection (3) of section
1131	627.06281, Florida Statutes, is amended to read:
1132	627.06281  Public hurricane loss projection model;
1133	reporting of data by insurers.-
1134	(3)
1135	(b)  The fees charged for private sector access and use of
1136	the model shall be the reasonable costs associated with the
1137	operation and maintenance of the model by the office. Such fees
1138	do not apply to access and use of the model by the office. By
1139	January 1, 2009, The office shall establish by rule a fee
1140	schedule for access to and the use of the model. The fee
1141	schedule must be reasonably calculated to cover only the actual
1142	costs of providing access to and the use of the model.
1143	Section 14.  Subsections (1) and (5) of section 627.0629,
1144	Florida Statutes, are amended to read:
1145	627.0629  Residential property insurance; rate filings.-
1146	(1)(a)  It is the intent of the Legislature that insurers
1147	must provide savings to consumers who install or implement
1148	windstorm damage mitigation techniques, alterations, or
1149	solutions to their properties to prevent windstorm losses. A
1150	rate filing for residential property insurance must include
1151	actuarially reasonable discounts, credits, or other rate
1152	differentials, or appropriate reductions in deductibles, for
1153	properties on which fixtures or construction techniques
1154	demonstrated to reduce the amount of loss in a windstorm have
1155	been installed or implemented. The fixtures or construction
1156	techniques must shall include, but are not be limited to,
1157	fixtures or construction techniques that which enhance roof
1158	strength, roof covering performance, roof-to-wall strength,
1159	wall-to-floor-to-foundation strength, opening protection, and
1160	window, door, and skylight strength. Credits, discounts, or
1161	other rate differentials, or appropriate reductions in
1162	deductibles, for fixtures and construction techniques that which
1163	meet the minimum requirements of the Florida Building Code must
1164	be included in the rate filing. All insurance companies must
1165	make a rate filing which includes the credits, discounts, or
1166	other rate differentials or reductions in deductibles by
1167	February 28, 2003. By July 1, 2007, the office shall reevaluate
1168	the discounts, credits, other rate differentials, and
1169	appropriate reductions in deductibles for fixtures and
1170	construction techniques that meet the minimum requirements of
1171	the Florida Building Code, based upon actual experience or any
1172	other loss relativity studies available to the office. The
1173	office shall determine the discounts, credits, other rate
1174	differentials, and appropriate reductions in deductibles that
1175	reflect the full actuarial value of such revaluation, which may
1176	be used by insurers in rate filings.
1177	(b)  By February 1, 2011, the Office of Insurance
1178	Regulation, in consultation with the Department of Financial
1179	Services and the Department of Community Affairs, shall develop
1180	and make publicly available a proposed method for insurers to
1181	establish discounts, credits, or other rate differentials for
1182	hurricane mitigation measures which directly correlate to the
1183	numerical rating assigned to a structure pursuant to the uniform
1184	home grading scale adopted by the Financial Services Commission
1185	pursuant to s. 215.55865, including any proposed changes to the
1186	uniform home grading scale. By October 1, 2011, the commission
1187	shall adopt rules requiring insurers to make rate filings for
1188	residential property insurance which revise insurers' discounts,
1189	credits, or other rate differentials for hurricane mitigation
1190	measures so that such rate differentials correlate directly to
1191	the uniform home grading scale. The rules may include such
1192	changes to the uniform home grading scale as the commission
1193	determines are necessary, and may specify the minimum required
1194	discounts, credits, or other rate differentials. Such rate
1195	differentials must be consistent with generally accepted
1196	actuarial principles and wind-loss mitigation studies. The rules
1197	shall allow a period of at least 2 years after the effective
1198	date of the revised mitigation discounts, credits, or other rate
1199	differentials for a property owner to obtain an inspection or
1200	otherwise qualify for the revised credit, during which time the
1201	insurer shall continue to apply the mitigation credit that was
1202	applied immediately prior to the effective date of the revised
1203	credit. Discounts, credits, and other rate differentials
1204	established for rate filings under this paragraph shall
1205	supersede, after adoption, the discounts, credits, and other
1206	rate differentials included in rate filings under paragraph (a).
1207	(5)  In order to provide an appropriate transition period,
1208	an insurer may, in its sole discretion, implement an approved
1209	rate filing for residential property insurance over a period of
1210	years. Such An insurer electing to phase in its rate filing must
1211	provide an informational notice to the office setting out its
1212	schedule for implementation of the phased-in rate filing. The An
1213	insurer may include in its rate the actual cost of private
1214	market reinsurance that corresponds to available coverage of the
1215	Temporary Increase in Coverage Limits, TICL, from the Florida
1216	Hurricane Catastrophe Fund. The insurer may also include the
1217	cost of reinsurance to replace the TICL reduction implemented
1218	pursuant to s. 215.555(17)(d)9. However, this cost for
1219	reinsurance may not include any expense or profit load or result
1220	in a total annual base rate increase in excess of 10 percent.
1221	Section 15.  Paragraphs (a), (b), (c), (d), (n), (v), and
1222	(y) of subsection (6) of section 627.351, Florida Statutes, are
1223	amended to read:
1224	627.351  Insurance risk apportionment plans.-
1225	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.-
1226	(a)1.  It is The public purpose of this subsection is to
1227	ensure that there is the existence of an orderly market for
1228	property insurance for residents Floridians and Florida
1229	businesses of this state.
1230	1.  The Legislature finds that private insurers are
1231	unwilling or unable to provide affordable property insurance
1232	coverage in this state to the extent sought and needed. The
1233	absence of affordable property insurance threatens the public
1234	health, safety, and welfare and likewise threatens the economic
1235	health of the state. The state therefore has a compelling public
1236	interest and a public purpose to assist in assuring that
1237	property in the state is insured and that it is insured at
1238	affordable rates so as to facilitate the remediation,
1239	reconstruction, and replacement of damaged or destroyed property
1240	in order to reduce or avoid the negative effects otherwise
1241	resulting to the public health, safety, and welfare, to the
1242	economy of the state, and to the revenues of the state and local
1243	governments which are needed to provide for the public welfare.
1244	It is necessary, therefore, to provide affordable property
1245	insurance to applicants who are in good faith entitled to
1246	procure insurance through the voluntary market but are unable to
1247	do so. The Legislature intends, therefore, by this subsection
1248	that affordable property insurance be provided and that it
1249	continue to be provided, as long as necessary, through Citizens
1250	Property Insurance Corporation, a government entity that is an
1251	integral part of the state, and that is not a private insurance
1252	company. To that end, the Citizens Property Insurance
1253	corporation shall strive to increase the availability of
1254	affordable property insurance in this state, while achieving
1255	efficiencies and economies, and while providing service to
1256	policyholders, applicants, and agents which is no less than the
1257	quality generally provided in the voluntary market, for the
1258	achievement of the foregoing public purposes. Because it is
1259	essential for this government entity to have the maximum
1260	financial resources to pay claims following a catastrophic
1261	hurricane, it is the intent of the Legislature that the Citizens
1262	Property Insurance corporation continue to be an integral part
1263	of the state and that the income of the corporation be exempt
1264	from federal income taxation and that interest on the debt
1265	obligations issued by the corporation be exempt from federal
1266	income taxation.
1267	2.  The Residential Property and Casualty Joint
1268	Underwriting Association originally created by this statute
1269	shall be known, as of July 1, 2002, as the Citizens Property
1270	Insurance Corporation. The corporation shall provide insurance
1271	for residential and commercial property, for applicants who are
1272	in good faith entitled, but, in good faith, are unable, to
1273	procure insurance through the voluntary market. The corporation
1274	shall operate pursuant to a plan of operation approved by order
1275	of the Financial Services Commission. The plan is subject to
1276	continuous review by the commission. The commission may, by
1277	order, withdraw approval of all or part of a plan if the
1278	commission determines that conditions have changed since
1279	approval was granted and that the purposes of the plan require
1280	changes in the plan. The corporation shall continue to operate
1281	pursuant to the plan of operation approved by the Office of
1282	Insurance Regulation until October 1, 2006. For the purposes of
1283	this subsection, residential coverage includes both personal
1284	lines residential coverage, which consists of the type of
1285	coverage provided by homeowner's, mobile home owner's, dwelling,
1286	tenant's, condominium unit owner's, and similar policies;, and
1287	commercial lines residential coverage, which consists of the
1288	type of coverage provided by condominium association, apartment
1289	building, and similar policies.
1290	3.  Effective January 1, 2009, a personal lines residential
1291	structure that has a dwelling replacement cost of $2 million or
1292	more, or a single condominium unit that has a combined dwelling
1293	and contents content replacement cost of $2 million or more is
1294	not eligible for coverage by the corporation. Such dwellings
1295	insured by the corporation on December 31, 2008, may continue to
1296	be covered by the corporation until the end of the policy term.
1297	However, such dwellings that are insured by the corporation and
1298	become ineligible for coverage due to the provisions of this
1299	subparagraph may reapply and obtain coverage if the property
1300	owner provides the corporation with a sworn affidavit from one
1301	or more insurance agents, on a form provided by the corporation,
1302	stating that the agents have made their best efforts to obtain
1303	coverage and that the property has been rejected for coverage by
1304	at least one authorized insurer and at least three surplus lines
1305	insurers. If such conditions are met, the dwelling may be
1306	insured by the corporation for up to 3 years, after which time
1307	the dwelling is ineligible for coverage. The office shall
1308	approve the method used by the corporation for valuing the
1309	dwelling replacement cost for the purposes of this subparagraph.
1310	If a policyholder is insured by the corporation prior to being
1311	determined to be ineligible pursuant to this subparagraph and
1312	such policyholder files a lawsuit challenging the determination,
1313	the policyholder may remain insured by the corporation until the
1314	conclusion of the litigation.
1315	4.  It is the intent of the Legislature that policyholders,
1316	applicants, and agents of the corporation receive service and
1317	treatment of the highest possible level but never less than that
1318	generally provided in the voluntary market. It is also is
1319	intended that the corporation be held to service standards no
1320	less than those applied to insurers in the voluntary market by
1321	the office with respect to responsiveness, timeliness, customer
1322	courtesy, and overall dealings with policyholders, applicants,
1323	or agents of the corporation.
1324	5.  Effective January 1, 2009, a personal lines residential
1325	structure that is located in the "wind-borne debris region," as
1326	defined in s. 1609.2, International Building Code (2006), and
1327	that has an insured value on the structure of $750,000 or more
1328	is not eligible for coverage by the corporation unless the
1329	structure has opening protections as required under the Florida
1330	Building Code for a newly constructed residential structure in
1331	that area. A residential structure shall be deemed to comply
1332	with the requirements of this subparagraph if it has shutters or
1333	opening protections on all openings and if such opening
1334	protections complied with the Florida Building Code at the time
1335	they were installed.
1336	6.  For any claim filed under any policy of the
1337	corporation, a public adjuster may not charge, agree to, or
1338	accept any compensation, payment, commission, fee, or other
1339	thing of value greater than 10 percent of the additional amount
1340	actually paid over the amount that was originally offered by the
1341	corporation for any one claim.
1342	(b)1.  All insurers authorized to write one or more subject
1343	lines of business in this state are subject to assessment by the
1344	corporation and, for the purposes of this subsection, are
1345	referred to collectively as "assessable insurers." Insurers
1346	writing one or more subject lines of business in this state
1347	pursuant to part VIII of chapter 626 are not assessable
1348	insurers, but insureds who procure one or more subject lines of
1349	business in this state pursuant to part VIII of chapter 626 are
1350	subject to assessment by the corporation and are referred to
1351	collectively as "assessable insureds." An authorized insurer's
1352	assessment liability begins shall begin on the first day of the
1353	calendar year following the year in which the insurer was issued
1354	a certificate of authority to transact insurance for subject
1355	lines of business in this state and terminates shall terminate 1
1356	year after the end of the first calendar year during which the
1357	insurer no longer holds a certificate of authority to transact
1358	insurance for subject lines of business in this state.
1359	2.a.  All revenues, assets, liabilities, losses, and
1360	expenses of the corporation shall be divided into three separate
1361	accounts as follows:
1362	(I)  A personal lines account for personal residential
1363	policies issued by the corporation, or issued by the Residential
1364	Property and Casualty Joint Underwriting Association and renewed
1365	by the corporation, which provides that provide comprehensive,
1366	multiperil coverage on risks that are not located in areas
1367	eligible for coverage by in the Florida Windstorm Underwriting
1368	Association as those areas were defined on January 1, 2002, and
1369	for such policies that do not provide coverage for the peril of
1370	wind on risks that are located in such areas;
1371	(II)  A commercial lines account for commercial residential
1372	and commercial nonresidential policies issued by the
1373	corporation, or issued by the Residential Property and Casualty
1374	Joint Underwriting Association and renewed by the corporation,
1375	which provides that provide coverage for basic property perils
1376	on risks that are not located in areas eligible for coverage by
1377	in the Florida Windstorm Underwriting Association as those areas
1378	were defined on January 1, 2002, and for such policies that do
1379	not provide coverage for the peril of wind on risks that are
1380	located in such areas; and
1381	(III)  A coastal high-risk account for personal residential
1382	policies and commercial residential and commercial
1383	nonresidential property policies issued by the corporation, or
1384	transferred to the corporation, which provides that provide
1385	coverage for the peril of wind on risks that are located in
1386	areas eligible for coverage by in the Florida Windstorm
1387	Underwriting Association as those areas were defined on January
1388	1, 2002. The corporation may offer policies that provide
1389	multiperil coverage and the corporation shall continue to offer
1390	policies that provide coverage only for the peril of wind for
1391	risks located in areas eligible for coverage in the coastal
1392	high-risk account. In issuing multiperil coverage, the
1393	corporation may use its approved policy forms and rates for the
1394	personal lines account. An applicant or insured who is eligible
1395	to purchase a multiperil policy from the corporation may
1396	purchase a multiperil policy from an authorized insurer without
1397	prejudice to the applicant's or insured's eligibility to
1398	prospectively purchase a policy that provides coverage only for
1399	the peril of wind from the corporation. An applicant or insured
1400	who is eligible for a corporation policy that provides coverage
1401	only for the peril of wind may elect to purchase or retain such
1402	policy and also purchase or retain coverage excluding wind from
1403	an authorized insurer without prejudice to the applicant's or
1404	insured's eligibility to prospectively purchase a policy that
1405	provides multiperil coverage from the corporation. It is the
1406	goal of the Legislature that there would be an overall average
1407	savings of 10 percent or more for a policyholder who currently
1408	has a wind-only policy with the corporation, and an ex-wind
1409	policy with a voluntary insurer or the corporation, and who then
1410	obtains a multiperil policy from the corporation. It is the
1411	intent of the Legislature that the offer of multiperil coverage
1412	in the coastal high-risk account be made and implemented in a
1413	manner that does not adversely affect the tax-exempt status of
1414	the corporation or creditworthiness of or security for currently
1415	outstanding financing obligations or credit facilities of the
1416	coastal high-risk account, the personal lines account, or the
1417	commercial lines account. The coastal high-risk account must
1418	also include quota share primary insurance under subparagraph
1419	(c)2. The area eligible for coverage under the coastal high-risk
1420	account also includes the area within Port Canaveral, which is
1421	bordered on the south by the City of Cape Canaveral, bordered on
1422	the west by the Banana River, and bordered on the north by
1423	Federal Government property.
1424	b.  The three separate accounts must be maintained as long
1425	as financing obligations entered into by the Florida Windstorm
1426	Underwriting Association or Residential Property and Casualty
1427	Joint Underwriting Association are outstanding, in accordance
1428	with the terms of the corresponding financing documents. If When
1429	the financing obligations are no longer outstanding, in
1430	accordance with the terms of the corresponding financing
1431	documents, the corporation may use a single account for all
1432	revenues, assets, liabilities, losses, and expenses of the
1433	corporation. Consistent with the requirement of this
1434	subparagraph and prudent investment policies that minimize the
1435	cost of carrying debt, the board shall exercise its best efforts
1436	to retire existing debt or to obtain the approval of necessary
1437	parties to amend the terms of existing debt, so as to structure
1438	the most efficient plan to consolidate the three separate
1439	accounts into a single account.
1440	c.  Creditors of the Residential Property and Casualty
1441	Joint Underwriting Association and of the accounts specified in
1442	sub-sub-subparagraphs a.(I) and (II) may have a claim against,
1443	and recourse to, those the accounts referred to in sub-sub-
1444	subparagraphs a.(I) and (II) and shall have no claim against, or
1445	recourse to, the account referred to in sub-sub-subparagraph
1446	a.(III). Creditors of the Florida Windstorm Underwriting
1447	Association shall have a claim against, and recourse to, the
1448	account referred to in sub-sub-subparagraph a.(III) and shall
1449	have no claim against, or recourse to, the accounts referred to
1450	in sub-sub-subparagraphs a.(I) and (II).
1451	d.  Revenues, assets, liabilities, losses, and expenses not
1452	attributable to particular accounts shall be prorated among the
1453	accounts.
1454	e.  The Legislature finds that the revenues of the
1455	corporation are revenues that are necessary to meet the
1456	requirements set forth in documents authorizing the issuance of
1457	bonds under this subsection.
1458	f.  No part of the income of the corporation may inure to
1459	the benefit of any private person.
1460	3.  With respect to a deficit in an account:
1461	a.  After accounting for the Citizens policyholder
1462	surcharge imposed under sub-subparagraph h. i., if when the
1463	remaining projected deficit incurred in a particular calendar
1464	year:
1465	(I)  Is not greater than 6 percent of the aggregate
1466	statewide direct written premium for the subject lines of
1467	business for the prior calendar year, the entire deficit shall
1468	be recovered through regular assessments of assessable insurers
1469	under paragraph (q) and assessable insureds.
1470	(II)b.  After accounting for the Citizens policyholder
1471	surcharge imposed under sub-subparagraph i., when the remaining
1472	projected deficit incurred in a particular calendar year Exceeds
1473	6 percent of the aggregate statewide direct written premium for
1474	the subject lines of business for the prior calendar year, the
1475	corporation shall levy regular assessments on assessable
1476	insurers under paragraph (q) and on assessable insureds in an
1477	amount equal to the greater of 6 percent of the deficit or 6
1478	percent of the aggregate statewide direct written premium for
1479	the subject lines of business for the prior calendar year. Any
1480	remaining deficit shall be recovered through emergency
1481	assessments under sub-subparagraph c. d.
1482	b.c.  Each assessable insurer's share of the amount being
1483	assessed under sub-subparagraph a. must or sub-subparagraph b.
1484	shall be in the proportion that the assessable insurer's direct
1485	written premium for the subject lines of business for the year
1486	preceding the assessment bears to the aggregate statewide direct
1487	written premium for the subject lines of business for that year.
1488	The assessment percentage applicable to each assessable insured
1489	is the ratio of the amount being assessed under sub-subparagraph
1490	a. or sub-subparagraph b. to the aggregate statewide direct
1491	written premium for the subject lines of business for the prior
1492	year. Assessments levied by the corporation on assessable
1493	insurers under sub-subparagraph a. must sub-subparagraphs a. and
1494	b. shall be paid as required by the corporation's plan of
1495	operation and paragraph (q). Assessments levied by the
1496	corporation on assessable insureds under sub-subparagraph a.
1497	sub-subparagraphs a. and b. shall be collected by the surplus
1498	lines agent at the time the surplus lines agent collects the
1499	surplus lines tax required by s. 626.932, and shall be paid to
1500	the Florida Surplus Lines Service Office at the time the surplus
1501	lines agent pays the surplus lines tax to that the Florida
1502	Surplus Lines Service office. Upon receipt of regular
1503	assessments from surplus lines agents, the Florida Surplus Lines
1504	Service Office shall transfer the assessments directly to the
1505	corporation as determined by the corporation.
1506	c.d.  Upon a determination by the board of governors that a
1507	deficit in an account exceeds the amount that will be recovered
1508	through regular assessments under sub-subparagraph a. or sub-
1509	subparagraph b., plus the amount that is expected to be
1510	recovered through surcharges under sub-subparagraph h. i., as to
1511	the remaining projected deficit the board shall levy, after
1512	verification by the office, shall levy emergency assessments,
1513	for as many years as necessary to cover the deficits, to be
1514	collected by assessable insurers and the corporation and
1515	collected from assessable insureds upon issuance or renewal of
1516	policies for subject lines of business, excluding National Flood
1517	Insurance policies. The amount of the emergency assessment
1518	collected in a particular year must shall be a uniform
1519	percentage of that year's direct written premium for subject
1520	lines of business and all accounts of the corporation, excluding
1521	National Flood Insurance Program policy premiums, as annually
1522	determined by the board and verified by the office. The office
1523	shall verify the arithmetic calculations involved in the board's
1524	determination within 30 days after receipt of the information on
1525	which the determination was based. Notwithstanding any other
1526	provision of law, the corporation and each assessable insurer
1527	that writes subject lines of business shall collect emergency
1528	assessments from its policyholders without such obligation being
1529	affected by any credit, limitation, exemption, or deferment.
1530	Emergency assessments levied by the corporation on assessable
1531	insureds shall be collected by the surplus lines agent at the
1532	time the surplus lines agent collects the surplus lines tax
1533	required by s. 626.932 and shall be paid to the Florida Surplus
1534	Lines Service Office at the time the surplus lines agent pays
1535	the surplus lines tax to that the Florida Surplus Lines Service
1536	office. The emergency assessments so collected shall be
1537	transferred directly to the corporation on a periodic basis as
1538	determined by the corporation and shall be held by the
1539	corporation solely in the applicable account. The aggregate
1540	amount of emergency assessments levied for an account under this
1541	sub-subparagraph in any calendar year may, at the discretion of
1542	the board of governors, be less than but may not exceed the
1543	greater of 10 percent of the amount needed to cover the deficit,
1544	plus interest, fees, commissions, required reserves, and other
1545	costs associated with financing of the original deficit, or 10
1546	percent of the aggregate statewide direct written premium for
1547	subject lines of business and for all accounts of the
1548	corporation for the prior year, plus interest, fees,
1549	commissions, required reserves, and other costs associated with
1550	financing the deficit.
1551	d.e.  The corporation may pledge the proceeds of
1552	assessments, projected recoveries from the Florida Hurricane
1553	Catastrophe Fund, other insurance and reinsurance recoverables,
1554	policyholder surcharges and other surcharges, and other funds
1555	available to the corporation as the source of revenue for and to
1556	secure bonds issued under paragraph (q), bonds or other
1557	indebtedness issued under subparagraph (c)3., or lines of credit
1558	or other financing mechanisms issued or created under this
1559	subsection, or to retire any other debt incurred as a result of
1560	deficits or events giving rise to deficits, or in any other way
1561	that the board determines will efficiently recover such
1562	deficits. The purpose of the lines of credit or other financing
1563	mechanisms is to provide additional resources to assist the
1564	corporation in covering claims and expenses attributable to a
1565	catastrophe. As used in this subsection, the term "assessments"
1566	includes regular assessments under sub-subparagraph a., sub-
1567	subparagraph b., or subparagraph (q)1. and emergency assessments
1568	under sub-subparagraph d. Emergency assessments collected under
1569	sub-subparagraph d. are not part of an insurer's rates, are not
1570	premium, and are not subject to premium tax, fees, or
1571	commissions; however, failure to pay the emergency assessment
1572	shall be treated as failure to pay premium. The emergency
1573	assessments under sub-subparagraph c. d. shall continue as long
1574	as any bonds issued or other indebtedness incurred with respect
1575	to a deficit for which the assessment was imposed remain
1576	outstanding, unless adequate provision has been made for the
1577	payment of such bonds or other indebtedness pursuant to the
1578	documents governing such bonds or other indebtedness.
1579	e.f.  As used in this subsection for purposes of any
1580	deficit incurred on or after January 25, 2007, the term "subject
1581	lines of business" means insurance written by assessable
1582	insurers or procured by assessable insureds for all property and
1583	casualty lines of business in this state, but not including
1584	workers' compensation or medical malpractice. As used in this
1585	the sub-subparagraph, the term "property and casualty lines of
1586	business" includes all lines of business identified on Form 2,
1587	Exhibit of Premiums and Losses, in the annual statement required
1588	of authorized insurers under by s. 624.424 and any rule adopted
1589	under this section, except for those lines identified as
1590	accident and health insurance and except for policies written
1591	under the National Flood Insurance Program or the Federal Crop
1592	Insurance Program. For purposes of this sub-subparagraph, the
1593	term "workers' compensation" includes both workers' compensation
1594	insurance and excess workers' compensation insurance.
1595	f.g.  The Florida Surplus Lines Service Office shall
1596	determine annually the aggregate statewide written premium in
1597	subject lines of business procured by assessable insureds and
1598	shall report that information to the corporation in a form and
1599	at a time the corporation specifies to ensure that the
1600	corporation can meet the requirements of this subsection and the
1601	corporation's financing obligations.
1602	g.h.  The Florida Surplus Lines Service Office shall verify
1603	the proper application by surplus lines agents of assessment
1604	percentages for regular assessments and emergency assessments
1605	levied under this subparagraph on assessable insureds and shall
1606	assist the corporation in ensuring the accurate, timely
1607	collection and payment of assessments by surplus lines agents as
1608	required by the corporation.
1609	h.i.  If a deficit is incurred in any account in 2008 or
1610	thereafter, the board of governors shall levy a Citizens
1611	policyholder surcharge against all policyholders of the
1612	corporation. for a 12-month period, which
1613	(I)  The surcharge shall be levied collected at the time of
1614	issuance or renewal of a policy, as a uniform percentage of the
1615	premium for the policy of up to 15 percent of such premium,
1616	which funds shall be used to offset the deficit.
1617	(II)  The surcharge is payable upon cancellation or
1618	termination of the policy, upon renewal of the policy, or upon
1619	issuance of a new policy by the corporation within the first 12
1620	months after the date of the levy or the period of time
1621	necessary to fully collect the surcharge amount.
1622	(III)  The corporation may not levy any regular assessments
1623	under paragraph (q) pursuant to sub-subparagraph a. or sub-
1624	subparagraph b. with respect to a particular year's deficit
1625	until the corporation has first levied the full amount of the
1626	surcharge authorized by this sub-subparagraph.
1627	(IV)  The surcharge is Citizens policyholder surcharges
1628	under this sub-subparagraph are not considered premium and is
1629	are not subject to commissions, fees, or premium taxes. However,
1630	failure to pay the surcharge such surcharges shall be treated as
1631	failure to pay premium.
1632	i.j.  If the amount of any assessments or surcharges
1633	collected from corporation policyholders, assessable insurers or
1634	their policyholders, or assessable insureds exceeds the amount
1635	of the deficits, such excess amounts shall be remitted to and
1636	retained by the corporation in a reserve to be used by the
1637	corporation, as determined by the board of governors and
1638	approved by the office, to pay claims or reduce any past,
1639	present, or future plan-year deficits or to reduce outstanding
1640	debt.
1641	(c)  The corporation's plan of operation of the
1642	corporation:
1643	1.  Must provide for adoption of residential property and
1644	casualty insurance policy forms and commercial residential and
1645	nonresidential property insurance forms, which forms must be
1646	approved by the office before prior to use. The corporation
1647	shall adopt the following policy forms:
1648	a.  Standard personal lines policy forms that are
1649	comprehensive multiperil policies providing full coverage of a
1650	residential property equivalent to the coverage provided in the
1651	private insurance market under an HO-3, HO-4, or HO-6 policy.
1652	b.  Basic personal lines policy forms that are policies
1653	similar to an HO-8 policy or a dwelling fire policy that provide
1654	coverage meeting the requirements of the secondary mortgage
1655	market, but which coverage is more limited than the coverage
1656	under a standard policy.
1657	c.  Commercial lines residential and nonresidential policy
1658	forms that are generally similar to the basic perils of full
1659	coverage obtainable for commercial residential structures and
1660	commercial nonresidential structures in the admitted voluntary
1661	market.
1662	d.  Personal lines and commercial lines residential
1663	property insurance forms that cover the peril of wind only. The
1664	forms are applicable only to residential properties located in
1665	areas eligible for coverage under the coastal high-risk account
1666	referred to in sub-subparagraph (b)2.a.
1667	e.  Commercial lines nonresidential property insurance
1668	forms that cover the peril of wind only. The forms are
1669	applicable only to nonresidential properties located in areas
1670	eligible for coverage under the coastal high-risk account
1671	referred to in sub-subparagraph (b)2.a.
1672	f.  The corporation may adopt variations of the policy
1673	forms listed in sub-subparagraphs a.-e. which that contain more
1674	restrictive coverage.
1675	2.a.  Must provide that the corporation adopt a program in
1676	which the corporation and authorized insurers enter into quota
1677	share primary insurance agreements for hurricane coverage, as
1678	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1679	property insurance forms for eligible risks which cover the
1680	peril of wind only.
1681	a.  As used in this subsection, the term:
1682	(I)  "Quota share primary insurance" means an arrangement
1683	in which the primary hurricane coverage of an eligible risk is
1684	provided in specified percentages by the corporation and an
1685	authorized insurer. The corporation and authorized insurer are
1686	each solely responsible for a specified percentage of hurricane
1687	coverage of an eligible risk as set forth in a quota share
1688	primary insurance agreement between the corporation and an
1689	authorized insurer and the insurance contract. The
1690	responsibility of the corporation or authorized insurer to pay
1691	its specified percentage of hurricane losses of an eligible
1692	risk, as set forth in the quota share primary insurance
1693	agreement, may not be altered by the inability of the other
1694	party to the agreement to pay its specified percentage of
1695	hurricane losses. Eligible risks that are provided hurricane
1696	coverage through a quota share primary insurance arrangement
1697	must be provided policy forms that set forth the obligations of
1698	the corporation and authorized insurer under the arrangement,
1699	clearly specify the percentages of quota share primary insurance
1700	provided by the corporation and authorized insurer, and
1701	conspicuously and clearly state that neither the authorized
1702	insurer and nor the corporation may not be held responsible
1703	beyond their its specified percentage of coverage of hurricane
1704	losses.
1705	(II)  "Eligible risks" means personal lines residential and
1706	commercial lines residential risks that meet the underwriting
1707	criteria of the corporation and are located in areas that were
1708	eligible for coverage by the Florida Windstorm Underwriting
1709	Association on January 1, 2002.
1710	b.  The corporation may enter into quota share primary
1711	insurance agreements with authorized insurers at corporation
1712	coverage levels of 90 percent and 50 percent.
1713	c.  If the corporation determines that additional coverage
1714	levels are necessary to maximize participation in quota share
1715	primary insurance agreements by authorized insurers, the
1716	corporation may establish additional coverage levels. However,
1717	the corporation's quota share primary insurance coverage level
1718	may not exceed 90 percent.
1719	d.  Any quota share primary insurance agreement entered
1720	into between an authorized insurer and the corporation must
1721	provide for a uniform specified percentage of coverage of
1722	hurricane losses, by county or territory as set forth by the
1723	corporation board, for all eligible risks of the authorized
1724	insurer covered under the quota share primary insurance
1725	agreement.
1726	e.  Any quota share primary insurance agreement entered
1727	into between an authorized insurer and the corporation is
1728	subject to review and approval by the office. However, such
1729	agreement shall be authorized only as to insurance contracts
1730	entered into between an authorized insurer and an insured who is
1731	already insured by the corporation for wind coverage.
1732	f.  For all eligible risks covered under quota share
1733	primary insurance agreements, the exposure and coverage levels
1734	for both the corporation and authorized insurers shall be
1735	reported by the corporation to the Florida Hurricane Catastrophe
1736	Fund. For all policies of eligible risks covered under such
1737	quota share primary insurance agreements, the corporation and
1738	the authorized insurer must shall maintain complete and accurate
1739	records for the purpose of exposure and loss reimbursement
1740	audits as required by Florida Hurricane Catastrophe fund rules.
1741	The corporation and the authorized insurer shall each maintain
1742	duplicate copies of policy declaration pages and supporting
1743	claims documents.
1744	g.  The corporation board shall establish in its plan of
1745	operation standards for quota share agreements which ensure that
1746	there is no discriminatory application among insurers as to the
1747	terms of the quota share agreements, pricing of the quota share
1748	agreements, incentive provisions if any, and consideration paid
1749	for servicing policies or adjusting claims.
1750	h.  The quota share primary insurance agreement between the
1751	corporation and an authorized insurer must set forth the
1752	specific terms under which coverage is provided, including, but
1753	not limited to, the sale and servicing of policies issued under
1754	the agreement by the insurance agent of the authorized insurer
1755	producing the business, the reporting of information concerning
1756	eligible risks, the payment of premium to the corporation, and
1757	arrangements for the adjustment and payment of hurricane claims
1758	incurred on eligible risks by the claims adjuster and personnel
1759	of the authorized insurer. Entering into a quota sharing
1760	insurance agreement between the corporation and an authorized
1761	insurer is shall be voluntary and at the discretion of the
1762	authorized insurer.
1763	3.a.  May provide that the corporation may employ or
1764	otherwise contract with individuals or other entities to provide
1765	administrative or professional services that may be appropriate
1766	to effectuate the plan. The corporation may shall have the power
1767	to borrow funds, by issuing bonds or by incurring other
1768	indebtedness, and shall have other powers reasonably necessary
1769	to effectuate the requirements of this subsection, including,
1770	without limitation, the power to issue bonds and incur other
1771	indebtedness in order to refinance outstanding bonds or other
1772	indebtedness. The corporation may, but is not required to, seek
1773	judicial validation of its bonds or other indebtedness under
1774	chapter 75. The corporation may issue bonds or incur other
1775	indebtedness, or have bonds issued on its behalf by a unit of
1776	local government pursuant to subparagraph (q)2., in the absence
1777	of a hurricane or other weather-related event, upon a
1778	determination by the corporation, subject to approval by the
1779	office, that such action would enable it to efficiently meet the
1780	financial obligations of the corporation and that such
1781	financings are reasonably necessary to effectuate the
1782	requirements of this subsection. The corporation may is
1783	authorized to take all actions needed to facilitate tax-free
1784	status for any such bonds or indebtedness, including formation
1785	of trusts or other affiliated entities. The corporation may
1786	shall have the authority to pledge assessments, projected
1787	recoveries from the Florida Hurricane Catastrophe Fund, other
1788	reinsurance recoverables, market equalization and other
1789	surcharges, and other funds available to the corporation as
1790	security for bonds or other indebtedness. In recognition of s.
1791	10, Art. I of the State Constitution, prohibiting the impairment
1792	of obligations of contracts, it is the intent of the Legislature
1793	that no action be taken whose purpose is to impair any bond
1794	indenture or financing agreement or any revenue source committed
1795	by contract to such bond or other indebtedness.
1796	b.  To ensure that the corporation is operating in an
1797	efficient and economic manner while providing quality service to
1798	policyholders, applicants, and agents, the board shall
1799	commission an independent third-party consultant having
1800	expertise in insurance company management or insurance company
1801	management consulting to prepare a report and make
1802	recommendations on the relative costs and benefits of
1803	outsourcing various policy issuance and service functions to
1804	private servicing carriers or entities performing similar
1805	functions in the private market for a fee, rather than
1806	performing such functions in house. In making such
1807	recommendations, the consultant shall consider how other
1808	residual markets, both in this state and around the country,
1809	outsource appropriate functions or use servicing carriers to
1810	better match expenses with revenues that fluctuate based on a
1811	widely varying policy count. The report must be completed by
1812	July 1, 2012. Upon receiving the report, the board shall develop
1813	a plan to implement the report and submit the plan for review,
1814	modification, and approval to the Financial Services Commission.
1815	Upon the commission's approval of the plan, the board shall
1816	begin implementing the plan by January 1, 2013.
1817	4.a.  Must require that the corporation operate subject to
1818	the supervision and approval of a board of governors consisting
1819	of eight individuals who are residents of this state, from
1820	different geographical areas of this state.
1821	a.  The Governor, the Chief Financial Officer, the
1822	President of the Senate, and the Speaker of the House of
1823	Representatives shall each appoint two members of the board. At
1824	least one of the two members appointed by each appointing
1825	officer must have demonstrated expertise in insurance, and is
1826	deemed to be within the scope of the exemption provided in s.
1827	112.313(7)(b). The Chief Financial Officer shall designate one
1828	of the appointees as chair. All board members serve at the
1829	pleasure of the appointing officer. All members of the board of
1830	governors are subject to removal at will by the officers who
1831	appointed them. All board members, including the chair, must be
1832	appointed to serve for 3-year terms beginning annually on a date
1833	designated by the plan. However, for the first term beginning on
1834	or after July 1, 2009, each appointing officer shall appoint one
1835	member of the board for a 2-year term and one member for a 3-
1836	year term. A Any board vacancy shall be filled for the unexpired
1837	term by the appointing officer. The Chief Financial Officer
1838	shall appoint a technical advisory group to provide information
1839	and advice to the board of governors in connection with the
1840	board's duties under this subsection. The executive director and
1841	senior managers of the corporation shall be engaged by the board
1842	and serve at the pleasure of the board. Any executive director
1843	appointed on or after July 1, 2006, is subject to confirmation
1844	by the Senate. The executive director is responsible for
1845	employing other staff as the corporation may require, subject to
1846	review and concurrence by the board.
1847	b.  The board shall create a Market Accountability Advisory
1848	Committee to assist the corporation in developing awareness of
1849	its rates and its customer and agent service levels in
1850	relationship to the voluntary market insurers writing similar
1851	coverage.
1852	(I)  The members of the advisory committee shall consist of
1853	the following 11 persons, one of whom must be elected chair by
1854	the members of the committee: four representatives, one
1855	appointed by the Florida Association of Insurance Agents, one by
1856	the Florida Association of Insurance and Financial Advisors, one
1857	by the Professional Insurance Agents of Florida, and one by the
1858	Latin American Association of Insurance Agencies; three
1859	representatives appointed by the insurers with the three highest
1860	voluntary market share of residential property insurance
1861	business in the state; one representative from the Office of
1862	Insurance Regulation; one consumer appointed by the board who is
1863	insured by the corporation at the time of appointment to the
1864	committee; one representative appointed by the Florida
1865	Association of Realtors; and one representative appointed by the
1866	Florida Bankers Association. All members shall be appointed to
1867	must serve for 3-year terms and may serve for consecutive terms.
1868	(II)  The committee shall report to the corporation at each
1869	board meeting on insurance market issues which may include rates
1870	and rate competition with the voluntary market; service,
1871	including policy issuance, claims processing, and general
1872	responsiveness to policyholders, applicants, and agents; and
1873	matters relating to depopulation.
1874	5.  Must provide a procedure for determining the
1875	eligibility of a risk for coverage, as follows:
1876	a.  Subject to the provisions of s. 627.3517, with respect
1877	to personal lines residential risks, if the risk is offered
1878	coverage from an authorized insurer at the insurer's approved
1879	rate under either a standard policy including wind coverage or,
1880	if consistent with the insurer's underwriting rules as filed
1881	with the office, a basic policy including wind coverage, for a
1882	new application to the corporation for coverage, the risk is not
1883	eligible for any policy issued by the corporation unless the
1884	premium for coverage from the authorized insurer is more than 15
1885	percent greater than the premium for comparable coverage from
1886	the corporation. If the risk is not able to obtain any such
1887	offer, the risk is eligible for either a standard policy
1888	including wind coverage or a basic policy including wind
1889	coverage issued by the corporation; however, if the risk could
1890	not be insured under a standard policy including wind coverage
1891	regardless of market conditions, the risk is shall be eligible
1892	for a basic policy including wind coverage unless rejected under
1893	subparagraph 8. However, with regard to a policyholder of the
1894	corporation or a policyholder removed from the corporation
1895	through an assumption agreement until the end of the assumption
1896	period, the policyholder remains eligible for coverage from the
1897	corporation regardless of any offer of coverage from an
1898	authorized insurer or surplus lines insurer. The corporation
1899	shall determine the type of policy to be provided on the basis
1900	of objective standards specified in the underwriting manual and
1901	based on generally accepted underwriting practices.
1902	(I)  If the risk accepts an offer of coverage through the
1903	market assistance plan or an offer of coverage through a
1904	mechanism established by the corporation before a policy is
1905	issued to the risk by the corporation or during the first 30
1906	days of coverage by the corporation, and the producing agent who
1907	submitted the application to the plan or to the corporation is
1908	not currently appointed by the insurer, the insurer shall:
1909	(A)  Pay to the producing agent of record of the policy,
1910	for the first year, an amount that is the greater of the
1911	insurer's usual and customary commission for the type of policy
1912	written or a fee equal to the usual and customary commission of
1913	the corporation; or
1914	(B)  Offer to allow the producing agent of record of the
1915	policy to continue servicing the policy for at least a period of
1916	not less than 1 year and offer to pay the agent the greater of
1917	the insurer's or the corporation's usual and customary
1918	commission for the type of policy written.
1919
1920	If the producing agent is unwilling or unable to accept
1921	appointment, the new insurer shall pay the agent in accordance
1922	with sub-sub-sub-subparagraph (A).
1923	(II)  If When the corporation enters into a contractual
1924	agreement for a take-out plan, the producing agent of record of
1925	the corporation policy is entitled to retain any unearned
1926	commission on the policy, and the insurer shall:
1927	(A)  Pay to the producing agent of record of the
1928	corporation policy, for the first year, an amount that is the
1929	greater of the insurer's usual and customary commission for the
1930	type of policy written or a fee equal to the usual and customary
1931	commission of the corporation; or
1932	(B)  Offer to allow the producing agent of record of the
1933	corporation policy to continue servicing the policy for at least
1934	a period of not less than 1 year and offer to pay the agent the
1935	greater of the insurer's or the corporation's usual and
1936	customary commission for the type of policy written.
1937
1938	If the producing agent is unwilling or unable to accept
1939	appointment, the new insurer shall pay the agent in accordance
1940	with sub-sub-sub-subparagraph (A).
1941	b.  With respect to commercial lines residential risks, for
1942	a new application to the corporation for coverage, if the risk
1943	is offered coverage under a policy including wind coverage from
1944	an authorized insurer at its approved rate, the risk is not
1945	eligible for a any policy issued by the corporation unless the
1946	premium for coverage from the authorized insurer is more than 15
1947	percent greater than the premium for comparable coverage from
1948	the corporation. If the risk is not able to obtain any such
1949	offer, the risk is eligible for a policy including wind coverage
1950	issued by the corporation. However, with regard to a
1951	policyholder of the corporation or a policyholder removed from
1952	the corporation through an assumption agreement until the end of
1953	the assumption period, the policyholder remains eligible for
1954	coverage from the corporation regardless of an any offer of
1955	coverage from an authorized insurer or surplus lines insurer.
1956	(I)  If the risk accepts an offer of coverage through the
1957	market assistance plan or an offer of coverage through a
1958	mechanism established by the corporation before a policy is
1959	issued to the risk by the corporation or during the first 30
1960	days of coverage by the corporation, and the producing agent who
1961	submitted the application to the plan or the corporation is not
1962	currently appointed by the insurer, the insurer shall:
1963	(A)  Pay to the producing agent of record of the policy,
1964	for the first year, an amount that is the greater of the
1965	insurer's usual and customary commission for the type of policy
1966	written or a fee equal to the usual and customary commission of
1967	the corporation; or
1968	(B)  Offer to allow the producing agent of record of the
1969	policy to continue servicing the policy for at least a period of
1970	not less than 1 year and offer to pay the agent the greater of
1971	the insurer's or the corporation's usual and customary
1972	commission for the type of policy written.
1973
1974	If the producing agent is unwilling or unable to accept
1975	appointment, the new insurer shall pay the agent in accordance
1976	with sub-sub-sub-subparagraph (A).
1977	(II)  If When the corporation enters into a contractual
1978	agreement for a take-out plan, the producing agent of record of
1979	the corporation policy is entitled to retain any unearned
1980	commission on the policy, and the insurer shall:
1981	(A)  Pay to the producing agent of record of the
1982	corporation policy, for the first year, an amount that is the
1983	greater of the insurer's usual and customary commission for the
1984	type of policy written or a fee equal to the usual and customary
1985	commission of the corporation; or
1986	(B)  Offer to allow the producing agent of record of the
1987	corporation policy to continue servicing the policy for at least
1988	a period of not less than 1 year and offer to pay the agent the
1989	greater of the insurer's or the corporation's usual and
1990	customary commission for the type of policy written.
1991
1992	If the producing agent is unwilling or unable to accept
1993	appointment, the new insurer shall pay the agent in accordance
1994	with sub-sub-sub-subparagraph (A).
1995	c.  For purposes of determining comparable coverage under
1996	sub-subparagraphs a. and b., the comparison must shall be based
1997	on those forms and coverages that are reasonably comparable. The
1998	corporation may rely on a determination of comparable coverage
1999	and premium made by the producing agent who submits the
2000	application to the corporation, made in the agent's capacity as
2001	the corporation's agent. A comparison may be made solely of the
2002	premium with respect to the main building or structure only on
2003	the following basis: the same coverage A or other building
2004	limits; the same percentage hurricane deductible that applies on
2005	an annual basis or that applies to each hurricane for commercial
2006	residential property; the same percentage of ordinance and law
2007	coverage, if the same limit is offered by both the corporation
2008	and the authorized insurer; the same mitigation credits, to the
2009	extent the same types of credits are offered both by the
2010	corporation and the authorized insurer; the same method for loss
2011	payment, such as replacement cost or actual cash value, if the
2012	same method is offered both by the corporation and the
2013	authorized insurer in accordance with underwriting rules; and
2014	any other form or coverage that is reasonably comparable as
2015	determined by the board. If an application is submitted to the
2016	corporation for wind-only coverage in the coastal high-risk
2017	account, the premium for the corporation's wind-only policy plus
2018	the premium for the ex-wind policy that is offered by an
2019	authorized insurer to the applicant must shall be compared to
2020	the premium for multiperil coverage offered by an authorized
2021	insurer, subject to the standards for comparison specified in
2022	this subparagraph. If the corporation or the applicant requests
2023	from the authorized insurer a breakdown of the premium of the
2024	offer by types of coverage so that a comparison may be made by
2025	the corporation or its agent and the authorized insurer refuses
2026	or is unable to provide such information, the corporation may
2027	treat the offer as not being an offer of coverage from an
2028	authorized insurer at the insurer's approved rate.
2029	6.  Must include rules for classifications of risks and
2030	rates therefor.
2031	7.  Must provide that if premium and investment income for
2032	an account attributable to a particular calendar year are in
2033	excess of projected losses and expenses for the account
2034	attributable to that year, such excess shall be held in surplus
2035	in the account. Such surplus must shall be available to defray
2036	deficits in that account as to future years and shall be used
2037	for that purpose before prior to assessing assessable insurers
2038	and assessable insureds as to any calendar year.
2039	8.  Must provide objective criteria and procedures to be
2040	uniformly applied to for all applicants in determining whether
2041	an individual risk is so hazardous as to be uninsurable. In
2042	making this determination and in establishing the criteria and
2043	procedures, the following must shall be considered:
2044	a.  Whether the likelihood of a loss for the individual
2045	risk is substantially higher than for other risks of the same
2046	class; and
2047	b.  Whether the uncertainty associated with the individual
2048	risk is such that an appropriate premium cannot be determined.
2049
2050	The acceptance or rejection of a risk by the corporation shall
2051	be construed as the private placement of insurance, and the
2052	provisions of chapter 120 do shall not apply.
2053	9.  Must provide that the corporation shall make its best
2054	efforts to procure catastrophe reinsurance at reasonable rates,
2055	to cover its projected 100-year probable maximum loss as
2056	determined by the board of governors.
2057	10.  The policies issued by the corporation must provide
2058	that, if the corporation or the market assistance plan obtains
2059	an offer from an authorized insurer to cover the risk at its
2060	approved rates, the risk is no longer eligible for renewal
2061	through the corporation, except as otherwise provided in this
2062	subsection.
2063	11.  Corporation policies and applications must include a
2064	notice that the corporation policy could, under this section, be
2065	replaced with a policy issued by an authorized insurer which
2066	that does not provide coverage identical to the coverage
2067	provided by the corporation. The notice must shall also specify
2068	that acceptance of corporation coverage creates a conclusive
2069	presumption that the applicant or policyholder is aware of this
2070	potential.
2071	12.  May establish, subject to approval by the office,
2072	different eligibility requirements and operational procedures
2073	for any line or type of coverage for any specified county or
2074	area if the board determines that such changes to the
2075	eligibility requirements and operational procedures are
2076	justified due to the voluntary market being sufficiently stable
2077	and competitive in such area or for such line or type of
2078	coverage and that consumers who, in good faith, are unable to
2079	obtain insurance through the voluntary market through ordinary
2080	methods would continue to have access to coverage from the
2081	corporation. If When coverage is sought in connection with a
2082	real property transfer, the such requirements and procedures may
2083	shall not provide for an effective date of coverage later than
2084	the date of the closing of the transfer as established by the
2085	transferor, the transferee, and, if applicable, the lender.
2086	13.  Must provide that, with respect to the coastal high-
2087	risk account, any assessable insurer with a surplus as to
2088	policyholders of $25 million or less writing 25 percent or more
2089	of its total countrywide property insurance premiums in this
2090	state may petition the office, within the first 90 days of each
2091	calendar year, to qualify as a limited apportionment company. A
2092	regular assessment levied by the corporation on a limited
2093	apportionment company for a deficit incurred by the corporation
2094	for the coastal high-risk account in 2006 or thereafter may be
2095	paid to the corporation on a monthly basis as the assessments
2096	are collected by the limited apportionment company from its
2097	insureds pursuant to s. 627.3512, but the regular assessment
2098	must be paid in full within 12 months after being levied by the
2099	corporation. A limited apportionment company shall collect from
2100	its policyholders any emergency assessment imposed under sub-
2101	subparagraph (b)3.d. The plan must shall provide that, if the
2102	office determines that any regular assessment will result in an
2103	impairment of the surplus of a limited apportionment company,
2104	the office may direct that all or part of such assessment be
2105	deferred as provided in subparagraph (q)4. However, there shall
2106	be no limitation or deferment of an emergency assessment to be
2107	collected from policyholders under sub-subparagraph (b)3.d. may
2108	not be limited or deferred.
2109	14.  Must provide that the corporation appoint as its
2110	licensed agents only those agents who also hold an appointment
2111	as defined in s. 626.015(3) with an insurer who at the time of
2112	the agent's initial appointment by the corporation is authorized
2113	to write and is actually writing personal lines residential
2114	property coverage, commercial residential property coverage, or
2115	commercial nonresidential property coverage within the state.
2116	15.  Must provide, by July 1, 2007, a premium payment plan
2117	option to its policyholders which, allows at a minimum, allows
2118	for quarterly and semiannual payment of premiums. A monthly
2119	payment plan may, but is not required to, be offered.
2120	16.  Must limit coverage on mobile homes or manufactured
2121	homes built before prior to 1994 to actual cash value of the
2122	dwelling rather than replacement costs of the dwelling.
2123	17.  May provide such limits of coverage as the board
2124	determines, consistent with the requirements of this subsection.
2125	18.  May require commercial property to meet specified
2126	hurricane mitigation construction features as a condition of
2127	eligibility for coverage.
2128	19.  Must provide that new or renewal policies issued by
2129	the corporation on or after January 1, 2012, which cover
2130	sinkhole loss do not include coverage for any loss to
2131	appurtenant structures, driveways, sidewalks, decks, or patios
2132	that are directly or indirectly caused by sinkhole activity. The
2133	corporation shall exclude such coverage using a notice of
2134	coverage change, which may be included with the policy renewal,
2135	and not by issuance of a notice of nonrenewal of the excluded
2136	coverage upon renewal of the current policy.
2137	20.  As of January 1, 2012, must require that the agent
2138	obtain from an applicant for coverage from the corporation an
2139	acknowledgement signed by the applicant, which includes, at a
2140	minimum, the following statement:
2141
2142	ACKNOWLEDGEMENT OF POTENTIAL SURCHARGE
2143	AND ASSESSMENT LIABILITY:
2144
2145	1.  AS A POLICYHOLDER OF CITIZENS PROPERTY
2146	INSURANCE CORPORATION, I UNDERSTAND THAT IF THE
2147	CORPORATION SUSTAINS A DEFICIT AS A RESULT OF
2148	HURRICANE LOSSES OR FOR ANY OTHER REASON, MY POLICY
2149	COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND
2150	PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF
2151	THE POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH
2152	AS 45 PERCENT OF MY PREMIUM, OR A DIFFERENT AMOUNT AS
2153	IMPOSED BY THE FLORIDA LEGISLATURE.
2154	2.  I ALSO UNDERSTAND THAT I MAY BE SUBJECT TO
2155	EMERGENCY ASSESSMENTS TO THE SAME EXTENT AS
2156	POLICYHOLDERS OF OTHER INSURANCE COMPANIES, OR A
2157	DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA
2158	LEGISLATURE.
2159	3.  I ALSO UNDERSTAND THAT CITIZENS PROPERTY
2160	INSURANCE CORPORATION IS NOT SUPPORTED BY THE FULL
2161	FAITH AND CREDIT OF THE STATE OF FLORIDA.
2162
2163	a.  The corporation shall maintain, in electronic format or
2164	otherwise, a copy of the applicant's signed acknowledgement and
2165	provide a copy of the statement to the policyholder as part of
2166	the first renewal after the effective date of this subparagraph.
2167	b.  The signed acknowledgement form creates a conclusive
2168	presumption that the policyholder understood and accepted his or
2169	her potential surcharge and assessment liability as a
2170	policyholder of the corporation.
2171	(d)1.  All prospective employees for senior management
2172	positions, as defined by the plan of operation, are subject to
2173	background checks as a prerequisite for employment. The office
2174	shall conduct the background checks on such prospective
2175	employees pursuant to ss. 624.34, 624.404(3), and 628.261.
2176	2.  On or before July 1 of each year, employees of the
2177	corporation must are required to sign and submit a statement
2178	attesting that they do not have a conflict of interest, as
2179	defined in part III of chapter 112. As a condition of
2180	employment, all prospective employees must are required to sign
2181	and submit to the corporation a conflict-of-interest statement.
2182	3.  Senior managers and members of the board of governors
2183	are subject to the provisions of part III of chapter 112,
2184	including, but not limited to, the code of ethics and public
2185	disclosure and reporting of financial interests, pursuant to s.
2186	112.3145. Notwithstanding s. 112.3143(2), a board member may not
2187	vote on any measure that would inure to his or her special
2188	private gain or loss; that he or she knows would inure to the
2189	special private gain or loss of any principal by whom he or she
2190	is retained or to the parent organization or subsidiary of a
2191	corporate principal by which he or she is retained, other than
2192	an agency as defined in s. 112.312; or that he or she knows
2193	would inure to the special private gain or loss of a relative or
2194	business associate of the public officer. Before the vote is
2195	taken, such member shall publicly state to the assembly the
2196	nature of his or her interest in the matter from which he or she
2197	is abstaining from voting and, within 15 days after the vote
2198	occurs, disclose the nature of his or her interest as a public
2199	record in a memorandum filed with the person responsible for
2200	recording the minutes of the meeting, who shall incorporate the
2201	memorandum in the minutes. Senior managers and board members are
2202	also required to file such disclosures with the Commission on
2203	Ethics and the Office of Insurance Regulation. The executive
2204	director of the corporation or his or her designee shall notify
2205	each existing and newly appointed and existing appointed member
2206	of the board of governors and senior managers of their duty to
2207	comply with the reporting requirements of part III of chapter
2208	112. At least quarterly, the executive director or his or her
2209	designee shall submit to the Commission on Ethics a list of
2210	names of the senior managers and members of the board of
2211	governors who are subject to the public disclosure requirements
2212	under s. 112.3145.
2213	4.  Notwithstanding s. 112.3148 or s. 112.3149, or any
2214	other provision of law, an employee or board member may not
2215	knowingly accept, directly or indirectly, any gift or
2216	expenditure from a person or entity, or an employee or
2217	representative of such person or entity, which that has a
2218	contractual relationship with the corporation or who is under
2219	consideration for a contract. An employee or board member who
2220	fails to comply with subparagraph 3. or this subparagraph is
2221	subject to penalties provided under ss. 112.317 and 112.3173.
2222	5.  Any senior manager of the corporation who is employed
2223	on or after January 1, 2007, regardless of the date of hire, who
2224	subsequently retires or terminates employment is prohibited from
2225	representing another person or entity before the corporation for
2226	2 years after retirement or termination of employment from the
2227	corporation.
2228	6.  Any senior manager of the corporation who is employed
2229	on or after January 1, 2007, regardless of the date of hire, who
2230	subsequently retires or terminates employment is prohibited from
2231	having any employment or contractual relationship for 2 years
2232	with an insurer that has entered into a take-out bonus agreement
2233	with the corporation.
2234	(n)1.  Rates for coverage provided by the corporation must
2235	shall be actuarially sound and subject to the requirements of s.
2236	627.062, except as otherwise provided in this paragraph. The
2237	corporation shall file its recommended rates with the office at
2238	least annually. The corporation shall provide any additional
2239	information regarding the rates which the office requires. The
2240	office shall consider the recommendations of the board and issue
2241	a final order establishing the rates for the corporation within
2242	45 days after the recommended rates are filed. The corporation
2243	may not pursue an administrative challenge or judicial review of
2244	the final order of the office.
2245	2.  In addition to the rates otherwise determined pursuant
2246	to this paragraph, the corporation shall impose and collect an
2247	amount equal to the premium tax provided for in s. 624.509 to
2248	augment the financial resources of the corporation.
2249	3.  After the public hurricane loss-projection model under
2250	s. 627.06281 has been found to be accurate and reliable by the
2251	Florida Commission on Hurricane Loss Projection Methodology, the
2252	that model shall serve as the minimum benchmark for determining
2253	the windstorm portion of the corporation's rates. This
2254	subparagraph does not require or allow the corporation to adopt
2255	rates lower than the rates otherwise required or allowed by this
2256	paragraph.
2257	4.  The rate filings for the corporation which were
2258	approved by the office and which took effect January 1, 2007,
2259	are rescinded, except for those rates that were lowered. As soon
2260	as possible, the corporation shall begin using the lower rates
2261	that were in effect on December 31, 2006, and shall provide
2262	refunds to policyholders who have paid higher rates as a result
2263	of that rate filing. The rates in effect on December 31, 2006,
2264	shall remain in effect for the 2007 and 2008 calendar years
2265	except for any rate change that results in a lower rate. The
2266	next rate change that may increase rates shall take effect
2267	pursuant to a new rate filing recommended by the corporation and
2268	established by the office, subject to the requirements of this
2269	paragraph.
2270	5.  Beginning on July 15, 2009, and annually each year
2271	thereafter, the corporation must make a recommended actuarially
2272	sound rate filing for each personal and commercial line of
2273	business it writes, to be effective no earlier than January 1,
2274	2010.
2275	6.  Beginning on or after January 1, 2010, and
2276	notwithstanding the board's recommended rates and the office's
2277	final order regarding the corporation's filed rates under
2278	subparagraph 1., the corporation shall annually implement a rate
2279	increase each year which, except for sinkhole coverage, does not
2280	exceed 10 percent for any single policy issued by the
2281	corporation, excluding coverage changes and surcharges.
2282	7.  The corporation may also implement an increase to
2283	reflect the effect on the corporation of the cash buildup factor
2284	pursuant to s. 215.555(5)(b).
2285	8.  The corporation's implementation of rates as prescribed
2286	in subparagraph 6. shall cease for any line of business written
2287	by the corporation upon the corporation's implementation of
2288	actuarially sound rates. Thereafter, the corporation shall
2289	annually make a recommended actuarially sound rate filing for
2290	each commercial and personal line of business the corporation
2291	writes.
2292	(v)1.  Effective July 1, 2002, policies of the Residential
2293	Property and Casualty Joint Underwriting Association shall
2294	become policies of the corporation. All obligations, rights,
2295	assets and liabilities of the Residential Property and Casualty
2296	Joint Underwriting association, including bonds, note and debt
2297	obligations, and the financing documents pertaining to them
2298	become those of the corporation as of July 1, 2002. The
2299	corporation is not required to issue endorsements or
2300	certificates of assumption to insureds during the remaining term
2301	of in-force transferred policies.
2302	2.  Effective July 1, 2002, policies of the Florida
2303	Windstorm Underwriting Association are transferred to the
2304	corporation and shall become policies of the corporation. All
2305	obligations, rights, assets, and liabilities of the Florida
2306	Windstorm Underwriting association, including bonds, note and
2307	debt obligations, and the financing documents pertaining to them
2308	are transferred to and assumed by the corporation on July 1,
2309	2002. The corporation is not required to issue endorsements or
2310	certificates of assumption to insureds during the remaining term
2311	of in-force transferred policies.
2312	3.  The Florida Windstorm Underwriting Association and the
2313	Residential Property and Casualty Joint Underwriting Association
2314	shall take all actions necessary as may be proper to further
2315	evidence the transfers and shall provide the documents and
2316	instruments of further assurance as may reasonably be requested
2317	by the corporation for that purpose. The corporation shall
2318	execute assumptions and instruments as the trustees or other
2319	parties to the financing documents of the Florida Windstorm
2320	Underwriting Association or the Residential Property and
2321	Casualty Joint Underwriting Association may reasonably request
2322	to further evidence the transfers and assumptions, which
2323	transfers and assumptions, however, are effective on the date
2324	provided under this paragraph whether or not, and regardless of
2325	the date on which, the assumptions or instruments are executed
2326	by the corporation. Subject to the relevant financing documents
2327	pertaining to their outstanding bonds, notes, indebtedness, or
2328	other financing obligations, the moneys, investments,
2329	receivables, choses in action, and other intangibles of the
2330	Florida Windstorm Underwriting Association shall be credited to
2331	the coastal high-risk account of the corporation, and those of
2332	the personal lines residential coverage account and the
2333	commercial lines residential coverage account of the Residential
2334	Property and Casualty Joint Underwriting Association shall be
2335	credited to the personal lines account and the commercial lines
2336	account, respectively, of the corporation.
2337	4.  Effective July 1, 2002, a new applicant for property
2338	insurance coverage who would otherwise have been eligible for
2339	coverage in the Florida Windstorm Underwriting Association is
2340	eligible for coverage from the corporation as provided in this
2341	subsection.
2342	5.  The transfer of all policies, obligations, rights,
2343	assets, and liabilities from the Florida Windstorm Underwriting
2344	Association to the corporation and the renaming of the
2345	Residential Property and Casualty Joint Underwriting Association
2346	as the corporation does not shall in no way affect the coverage
2347	with respect to covered policies as defined in s. 215.555(2)(c)
2348	provided to these entities by the Florida Hurricane Catastrophe
2349	Fund. The coverage provided by the Florida Hurricane Catastrophe
2350	fund to the Florida Windstorm Underwriting Association based on
2351	its exposures as of June 30, 2002, and each June 30 thereafter
2352	shall be redesignated as coverage for the coastal high-risk
2353	account of the corporation. Notwithstanding any other provision
2354	of law, the coverage provided by the Florida Hurricane
2355	Catastrophe fund to the Residential Property and Casualty Joint
2356	Underwriting Association based on its exposures as of June 30,
2357	2002, and each June 30 thereafter shall be transferred to the
2358	personal lines account and the commercial lines account of the
2359	corporation. Notwithstanding any other provision of law, the
2360	coastal high-risk account shall be treated, for all Florida
2361	Hurricane Catastrophe Fund purposes, as if it were a separate
2362	participating insurer with its own exposures, reimbursement
2363	premium, and loss reimbursement. Likewise, the personal lines
2364	and commercial lines accounts shall be viewed together, for all
2365	Florida Hurricane Catastrophe fund purposes, as if the two
2366	accounts were one and represent a single, separate participating
2367	insurer with its own exposures, reimbursement premium, and loss
2368	reimbursement. The coverage provided by the Florida Hurricane
2369	Catastrophe fund to the corporation shall constitute and operate
2370	as a full transfer of coverage from the Florida Windstorm
2371	Underwriting Association and Residential Property and Casualty
2372	Joint Underwriting to the corporation.
2373	(y)  It is the intent of the Legislature that the
2374	amendments to this subsection enacted in 2002 should, over time,
2375	reduce the probable maximum windstorm losses in the residual
2376	markets and should reduce the potential assessments to be levied
2377	on property insurers and policyholders statewide. In furtherance
2378	of this intent:
2379	1.  the board shall, on or before February 1 of each year,
2380	provide a report to the President of the Senate and the Speaker
2381	of the House of Representatives showing the reduction or
2382	increase in the 100-year probable maximum loss attributable to
2383	wind-only coverages and the quota share program under this
2384	subsection combined, as compared to the benchmark 100-year
2385	probable maximum loss of the Florida Windstorm Underwriting
2386	Association. For purposes of this paragraph, the benchmark 100-
2387	year probable maximum loss of the Florida Windstorm Underwriting
2388	Association shall be the calculation dated February 2001 and
2389	based on November 30, 2000, exposures. In order to ensure
2390	comparability of data, the board shall use the same methods for
2391	calculating its probable maximum loss as were used to calculate
2392	the benchmark probable maximum loss.
2393	2.  Beginning December 1, 2010, if the report under
2394	subparagraph 1. for any year indicates that the 100-year
2395	probable maximum loss attributable to wind-only coverages and
2396	the quota share program combined does not reflect a reduction of
2397	at least 25 percent from the benchmark, the board shall reduce
2398	the boundaries of the high-risk area eligible for wind-only
2399	coverages under this subsection in a manner calculated to reduce
2400	such probable maximum loss to an amount at least 25 percent
2401	below the benchmark.
2402	3.  Beginning February 1, 2015, if the report under
2403	subparagraph 1. for any year indicates that the 100-year
2404	probable maximum loss attributable to wind-only coverages and
2405	the quota share program combined does not reflect a reduction of
2406	at least 50 percent from the benchmark, the boundaries of the
2407	high-risk area eligible for wind-only coverages under this
2408	subsection shall be reduced by the elimination of any area that
2409	is not seaward of a line 1,000 feet inland from the Intracoastal
2410	Waterway.
2411	Section 16.  Paragraph (a) of subsection (5) of section
2412	627.3511, Florida Statutes, is amended to read:
2413	627.3511  Depopulation of Citizens Property Insurance
2414	Corporation.-
2415	(5)  APPLICABILITY.-
2416	(a)  The take-out bonus provided by subsection (2) and the
2417	exemption from assessment provided by paragraph (3)(a) apply
2418	only if the corporation policy is replaced by either a standard
2419	policy including wind coverage or, if consistent with the
2420	insurer's underwriting rules as filed with the office, a basic
2421	policy including wind coverage; however, for with respect to
2422	risks located in areas where coverage through the coastal high-
2423	risk account of the corporation is available, the replacement
2424	policy need not provide wind coverage. The insurer must renew
2425	the replacement policy at approved rates on substantially
2426	similar terms for four additional 1-year terms, unless canceled
2427	or not renewed by the policyholder. If an insurer assumes the
2428	corporation's obligations for a policy, it must issue a
2429	replacement policy for a 1-year term upon expiration of the
2430	corporation policy and must renew the replacement policy at
2431	approved rates on substantially similar terms for four
2432	additional 1-year terms, unless canceled or not renewed by the
2433	policyholder. For each replacement policy canceled or nonrenewed
2434	by the insurer for any reason during the 5-year coverage period
2435	required by this paragraph, the insurer must remove from the
2436	corporation one additional policy covering a risk similar to the
2437	risk covered by the canceled or nonrenewed policy. In addition
2438	to these requirements, the corporation must place the bonus
2439	moneys in escrow for a period of 5 years; such moneys may be
2440	released from escrow only to pay claims. If the policy is
2441	canceled or nonrenewed before the end of the 5-year period, the
2442	amount of the take-out bonus must be prorated for the time
2443	period the policy was insured. A take-out bonus provided by
2444	subsection (2) or subsection (6) is shall not be considered
2445	premium income for purposes of taxes and assessments under the
2446	Florida Insurance Code and shall remain the property of the
2447	corporation, subject to the prior security interest of the
2448	insurer under the escrow agreement until it is released from
2449	escrow;, and after it is released from escrow it is shall be
2450	considered an asset of the insurer and credited to the insurer's
2451	capital and surplus.
2452	Section 17.  Paragraph (b) of subsection (2) of section
2453	627.4133, Florida Statutes, is amended to read:
2454	627.4133  Notice of cancellation, nonrenewal, or renewal
2455	premium.-
2456	(2)  With respect to any personal lines or commercial
2457	residential property insurance policy, including, but not
2458	limited to, any homeowner's, mobile home owner's, farmowner's,
2459	condominium association, condominium unit owner's, apartment
2460	building, or other policy covering a residential structure or
2461	its contents:
2462	(b)  The insurer shall give the named insured written
2463	notice of nonrenewal, cancellation, or termination at least 100
2464	days before prior to the effective date of the nonrenewal,
2465	cancellation, or termination. However, the insurer shall give at
2466	least 100 days' written notice, or written notice by June 1,
2467	whichever is earlier, for any nonrenewal, cancellation, or
2468	termination that would be effective between June 1 and November
2469	30. The notice must include the reason or reasons for the
2470	nonrenewal, cancellation, or termination, except that:
2471	1.  The insurer shall give the named insured written notice
2472	of nonrenewal, cancellation, or termination at least 120 180
2473	days prior to the effective date of the nonrenewal,
2474	cancellation, or termination for a named insured whose
2475	residential structure has been insured by that insurer or an
2476	affiliated insurer for at least a 5-year period immediately
2477	prior to the date of the written notice.
2478	2.  If When cancellation is for nonpayment of premium, at
2479	least 10 days' written notice of cancellation accompanied by the
2480	reason therefor must shall be given. As used in this
2481	subparagraph, the term "nonpayment of premium" means failure of
2482	the named insured to discharge when due any of her or his
2483	obligations in connection with the payment of premiums on a
2484	policy or any installment of such premium, whether the premium
2485	is payable directly to the insurer or its agent or indirectly
2486	under any premium finance plan or extension of credit, or
2487	failure to maintain membership in an organization if such
2488	membership is a condition precedent to insurance coverage. The
2489	term "Nonpayment of premium" also means the failure of a
2490	financial institution to honor an insurance applicant's check
2491	after delivery to a licensed agent for payment of a premium,
2492	even if the agent has previously delivered or transferred the
2493	premium to the insurer. If a dishonored check represents the
2494	initial premium payment, the contract and all contractual
2495	obligations are shall be void ab initio unless the nonpayment is
2496	cured within the earlier of 5 days after actual notice by
2497	certified mail is received by the applicant or 15 days after
2498	notice is sent to the applicant by certified mail or registered
2499	mail, and if the contract is void, any premium received by the
2500	insurer from a third party must shall be refunded to that party
2501	in full.
2502	3.  If When such cancellation or termination occurs during
2503	the first 90 days during which the insurance is in force and the
2504	insurance is canceled or terminated for reasons other than
2505	nonpayment of premium, at least 20 days' written notice of
2506	cancellation or termination accompanied by the reason therefor
2507	must shall be given unless except where there has been a
2508	material misstatement or misrepresentation or failure to comply
2509	with the underwriting requirements established by the insurer.
2510	4.  The requirement for providing written notice of
2511	nonrenewal by June 1 of any nonrenewal that would be effective
2512	between June 1 and November 30 does not apply to the following
2513	situations, but the insurer remains subject to the requirement
2514	to provide such notice at least 100 days before prior to the
2515	effective date of nonrenewal:
2516	a.  A policy that is nonrenewed due to a revision in the
2517	coverage for sinkhole losses and catastrophic ground cover
2518	collapse pursuant to s. 627.706, as amended by s. 30, chapter
2519	2007-1, Laws of Florida.
2520	b.  A policy that is nonrenewed by Citizens Property
2521	Insurance Corporation, pursuant to s. 627.351(6), for a policy
2522	that has been assumed by an authorized insurer offering
2523	replacement or renewal coverage to the policyholder is exempt
2524	from the notice requirements of paragraph (a) and this
2525	paragraph. In such cases, the corporation must give the named
2526	insured written notice of nonrenewal at least 45 days before the
2527	effective date of the nonrenewal.
2528
2529	After the policy has been in effect for 90 days, the policy may
2530	shall not be canceled by the insurer unless except when there
2531	has been a material misstatement, a nonpayment of premium, a
2532	failure to comply with underwriting requirements established by
2533	the insurer within 90 days after of the date of effectuation of
2534	coverage, or a substantial change in the risk covered by the
2535	policy or if when the cancellation is for all insureds under
2536	such policies for a given class of insureds. This paragraph does
2537	not apply to individually rated risks having a policy term of
2538	less than 90 days.
2539	5.  Notwithstanding any other provision of law, an insurer
2540	may cancel or nonrenew a property insurance policy after at
2541	least 45 days' notice if the office finds that the early
2542	cancellation of some or all of the insurer's policies is
2543	necessary to protect the best interests of the public or
2544	policyholders and the office approves the insurer's plan for
2545	early cancellation or nonrenewal of some or all of its policies.
2546	The office may base such finding upon the financial condition of
2547	the insurer, lack of adequate reinsurance coverage for hurricane
2548	risk, or other relevant factors. The office may condition its
2549	finding on the consent of the insurer to be placed under
2550	administrative supervision pursuant to s. 624.81 or to the
2551	appointment of a receiver under chapter 631.
2552	6.  A policy covering both a home and motor vehicle may be
2553	nonrenewed for any reason applicable to either the property or
2554	motor vehicle insurance after providing 90 days' notice.
2555	Section 18.  Section 627.43141, Florida Statutes, is
2556	created to read:
2557	627.43141  Notice of change in policy terms.-
2558	(1)  As used in this section, the term:
2559	(a)  "Change in policy terms" means the modification,
2560	addition, or deletion of any term, coverage, duty, or condition
2561	from the previous policy. The correction of typographical or
2562	scrivener's errors or the application of mandated legislative
2563	changes is not a change in policy terms.
2564	(b)  "Policy" means a written contract of property and
2565	casualty insurance or written agreement for such insurance, by
2566	whatever name called, and includes all clauses, riders,
2567	endorsements, and papers that are a part of such policy. The
2568	term does not include a binder as defined in s. 627.420 unless
2569	the duration of the binder period exceeds 60 days.
2570	(c)  "Renewal" means the issuance and delivery by an
2571	insurer of a policy superseding at the end of the policy period
2572	a policy previously issued and delivered by the same insurer or
2573	the issuance and delivery of a certificate or notice extending
2574	the term of a policy beyond its policy period or term. Any
2575	policy that has a policy period or term of less than 6 months or
2576	that does not have a fixed expiration date shall, for purposes
2577	of this section, be considered as written for successive policy
2578	periods or terms of 6 months.
2579	(2)  A renewal policy may contain a change in policy terms.
2580	If a renewal policy does contains such change, the insurer must
2581	give the named insured written notice of the change, which must
2582	be enclosed along with the written notice of renewal premium
2583	required by ss. 627.4133 and 627.728. Such notice shall be
2584	entitled "Notice of Change in Policy Terms."
2585	(3)  Although not required, proof of mailing or registered
2586	mailing through the United States Postal Service of the Notice
2587	of Change in Policy Terms to the named insured at the address
2588	shown in the policy is sufficient proof of notice.
2589	(4)  Receipt of the premium payment for the renewal policy
2590	by the insurer is deemed to be acceptance of the new policy
2591	terms by the named insured.
2592	(5)  If an insurer fails to provide the notice required in
2593	subsection (2), the original policy terms remain in effect until
2594	the next renewal and the proper service of the notice, or until
2595	the effective date of replacement coverage obtained by the named
2596	insured, whichever occurs first.
2597	(6)  The intent of this section is to:
2598	(a)  Allow an insurer to make a change in policy terms
2599	without nonrenewing those policyholders that the insurer wishes
2600	to continue insuring.
2601	(b)  Alleviate concern and confusion to the policyholder
2602	caused by the required policy nonrenewal for the limited issue
2603	if an insurer intends to renew the insurance policy, but the new
2604	policy contains a change in policy terms.
2605	(c)  Encourage policyholders to discuss their coverages
2606	with their insurance agents.
2607	Section 19.  Section 627.7011, Florida Statutes, is amended
2608	to read:
2609	627.7011  Homeowners' policies; offer of replacement cost
2610	coverage and law and ordinance coverage.-
2611	(1)  Prior to issuing a homeowner's insurance policy on or
2612	after October 1, 2005, or prior to the first renewal of a
2613	homeowner's insurance policy on or after October 1, 2005, the
2614	insurer must offer each of the following:
2615	(a)  A policy or endorsement providing that any loss that
2616	which is repaired or replaced will be adjusted on the basis of
2617	replacement costs to the dwelling not exceeding policy limits as
2618	to the dwelling, rather than actual cash value, but not
2619	including costs necessary to meet applicable laws and ordinances
2620	regulating the construction, use, or repair of any property or
2621	requiring the tearing down of any property, including the costs
2622	of removing debris.
2623	(b)  A policy or endorsement providing that, subject to
2624	other policy provisions, any loss that which is repaired or
2625	replaced at any location will be adjusted on the basis of
2626	replacement costs to the dwelling not exceeding policy limits as
2627	to the dwelling, rather than actual cash value, and also
2628	including costs necessary to meet applicable laws and ordinances
2629	regulating the construction, use, or repair of any property or
2630	requiring the tearing down of any property, including the costs
2631	of removing debris.; However, such additional costs necessary to
2632	meet applicable laws and ordinances may be limited to either 25
2633	percent or 50 percent of the dwelling limit, as selected by the
2634	policyholder, and such coverage applies shall apply only to
2635	repairs of the damaged portion of the structure unless the total
2636	damage to the structure exceeds 50 percent of the replacement
2637	cost of the structure.
2638
2639	An insurer is not required to make the offers required by this
2640	subsection with respect to the issuance or renewal of a
2641	homeowner's policy that contains the provisions specified in
2642	paragraph (b) for law and ordinance coverage limited to 25
2643	percent of the dwelling limit, except that the insurer must
2644	offer the law and ordinance coverage limited to 50 percent of
2645	the dwelling limit. This subsection does not prohibit the offer
2646	of a guaranteed replacement cost policy.
2647	(2)  Unless the insurer obtains the policyholder's written
2648	refusal of the policies or endorsements specified in subsection
2649	(1), any policy covering the dwelling is deemed to include the
2650	law and ordinance coverage limited to 25 percent of the dwelling
2651	limit. The rejection or selection of alternative coverage shall
2652	be made on a form approved by the office. The form must shall
2653	fully advise the applicant of the nature of the coverage being
2654	rejected. If this form is signed by a named insured, it is will
2655	be conclusively presumed that there was an informed, knowing
2656	rejection of the coverage or election of the alternative
2657	coverage on behalf of all insureds. Unless the policyholder
2658	requests in writing the coverage specified in this section, it
2659	need not be provided in or supplemental to any other policy that
2660	renews, insures, extends, changes, supersedes, or replaces an
2661	existing policy if when the policyholder has rejected the
2662	coverage specified in this section or has selected alternative
2663	coverage. The insurer must provide the such policyholder with
2664	notice of the availability of such coverage in a form approved
2665	by the office at least once every 3 years. The failure to
2666	provide such notice constitutes a violation of this code, but
2667	does not affect the coverage provided under the policy.
2668	(3)  In the event of a loss for which a dwelling or
2669	personal property is insured on the basis of replacement costs:
2670	(a)  For a dwelling, the insurer must initially pay at
2671	least the actual cash value of the insured loss, less any
2672	applicable deductible. The insurer shall pay any remaining
2673	amounts necessary to perform such repairs as work is performed
2674	and expenses are incurred. If a total loss of a dwelling occurs,
2675	the insurer shall pay the replacement cost coverage without
2676	reservation or holdback of any depreciation in value, pursuant
2677	to s. 627.702.
2678	(b)  For personal property:
2679	1.  The insurer must offer coverage under which the insurer
2680	is obligated to pay the replacement cost without reservation or
2681	holdback for any depreciation in value, whether or not the
2682	insured replaces the property.
2683	2.  The insurer may also offer coverage under which the
2684	insurer may limit the initial payment to the actual cash value
2685	of the personal property to be replaced, require the insured to
2686	provide receipts for the purchase of the property financed by
2687	the initial payment, use such receipts to make the next payment
2688	requested by the insured for the replacement of insured
2689	property, and continue this process until the insured remits all
2690	receipts up to the policy limits for replacement costs. The
2691	insurer must provide clear notice of this process before the
2692	policy is bound. A policyholder must be provided an actuarially
2693	reasonable premium credit or discount for this coverage. The
2694	insurer may not require the policyholder to advance payment for
2695	the replaced property, the insurer shall pay the replacement
2696	cost without reservation or holdback of any depreciation in
2697	value, whether or not the insured replaces or repairs the
2698	dwelling or property.
2699	(4)  A Any homeowner's insurance policy issued or renewed
2700	on or after October 1, 2005, must include in bold type no
2701	smaller than 18 points the following statement:
2702	"LAW AND ORDINANCE COVERAGE IS AN IMPORTANT COVERAGE
2703	THAT YOU MAY WISH TO PURCHASE. YOU MAY ALSO NEED TO
2704	CONSIDER THE PURCHASE OF FLOOD INSURANCE FROM THE
2705	NATIONAL FLOOD INSURANCE PROGRAM. WITHOUT THIS
2706	COVERAGE, YOU MAY HAVE UNCOVERED LOSSES. PLEASE
2707	DISCUSS THESE COVERAGES WITH YOUR INSURANCE AGENT."
2708
2709	The intent of this subsection is to encourage policyholders to
2710	purchase sufficient coverage to protect them in case events
2711	excluded from the standard homeowners policy, such as law and
2712	ordinance enforcement and flood, combine with covered events to
2713	produce damage or loss to the insured property. The intent is
2714	also to encourage policyholders to discuss these issues with
2715	their insurance agent.
2716	(5)  Nothing in This section does not: shall be construed
2717	to
2718	(a)  Apply to policies not considered to be "homeowners'
2719	policies," as that term is commonly understood in the insurance
2720	industry. This section specifically does not
2721	(b)  Apply to mobile home policies. Nothing in this section
2722	(c)  Limit shall be construed as limiting the ability of an
2723	any insurer to reject or nonrenew any insured or applicant on
2724	the grounds that the structure does not meet underwriting
2725	criteria applicable to replacement cost or law and ordinance
2726	policies or for other lawful reasons.
2727	(d)(6)  This section does not Prohibit an insurer from
2728	limiting its liability under a policy or endorsement providing
2729	that loss will be adjusted on the basis of replacement costs to
2730	the lesser of:
2731	1.(a)  The limit of liability shown on the policy
2732	declarations page;
2733	2.(b)  The reasonable and necessary cost to repair the
2734	damaged, destroyed, or stolen covered property; or
2735	3.(c)  The reasonable and necessary cost to replace the
2736	damaged, destroyed, or stolen covered property.
2737	(e)(7)  This section does not Prohibit an insurer from
2738	exercising its right to repair damaged property in compliance
2739	with its policy and s. 627.702(7).
2740	Section 20.  Paragraph (a) of subsection (5) of section
2741	627.70131, Florida Statutes, is amended to read:
2742	627.70131  Insurer's duty to acknowledge communications
2743	regarding claims; investigation.-
2744	(5)(a)  Within 90 days after an insurer receives notice of
2745	an initial, reopened, or supplemental a property insurance claim
2746	from a policyholder, the insurer shall pay or deny such claim or
2747	a portion of the claim unless the failure to pay such claim or a
2748	portion of the claim is caused by factors beyond the control of
2749	the insurer which reasonably prevent such payment. Any payment
2750	of an initial or supplemental a claim or portion of such a claim
2751	made paid 90 days after the insurer receives notice of the
2752	claim, or made paid more than 15 days after there are no longer
2753	factors beyond the control of the insurer which reasonably
2754	prevented such payment, whichever is later, bears shall bear
2755	interest at the rate set forth in s. 55.03. Interest begins to
2756	accrue from the date the insurer receives notice of the claim.
2757	The provisions of this subsection may not be waived, voided, or
2758	nullified by the terms of the insurance policy. If there is a
2759	right to prejudgment interest, the insured shall select whether
2760	to receive prejudgment interest or interest under this
2761	subsection. Interest is payable when the claim or portion of the
2762	claim is paid. Failure to comply with this subsection
2763	constitutes a violation of this code. However, failure to comply
2764	with this subsection does shall not form the sole basis for a
2765	private cause of action.
2766	Section 21.  The Legislature finds and declares:
2767	(1)  There is a compelling state interest in maintaining a
2768	viable and orderly private-sector market for property insurance
2769	in this state. The lack of a viable and orderly property market
2770	reduces the availability of property insurance coverage to state
2771	residents, increases the cost of property insurance, and
2772	increases the state's reliance on a residual property insurance
2773	market and its potential for imposing assessments on
2774	policyholders throughout the state.
2775	(2)  In 2005, the Legislature revised ss. 627.706-627.7074,
2776	Florida Statutes, to adopt certain geological or technical
2777	terms; to increase reliance on objective, scientific testing
2778	requirements; and generally to reduce the number of sinkhole
2779	claims and related disputes arising under prior law. The
2780	Legislature determined that since the enactment of these
2781	statutory revisions, both private-sector insurers and Citizens
2782	Property Insurance Corporation have, nevertheless, continued to
2783	experience high claims frequency and severity for sinkhole
2784	insurance claims. In addition, many properties remain unrepaired
2785	even after loss payments, which reduces the local property tax
2786	base and adversely affects the real estate market. Therefore,
2787	the Legislature finds that losses associated with sinkhole
2788	claims adversely affect the public health, safety, and welfare
2789	of this state and its citizens.
2790	(3)  Pursuant to sections 23 through 28 of this act,
2791	technical or scientific definitions adopted in the 2005
2792	legislation are clarified to implement and advance the
2793	Legislature's intended reduction of sinkhole claims and
2794	disputes. Certain other revisions to ss. 627.706-627.7074,
2795	Florida Statutes, are enacted to advance legislative intent to
2796	rely on scientific or technical determinations relating to
2797	sinkholes and sinkhole claims, reduce the number and cost of
2798	disputes relating to sinkhole claims, and ensure that repairs
2799	are made commensurate with the scientific and technical
2800	determinations and insurance claims payments.
2801	Section 22.  Section 627.706, Florida Statutes, is
2802	reordered and amended to read:
2803	627.706  Sinkhole insurance; catastrophic ground cover
2804	collapse; definitions.-
2805	(1)(a)  Every insurer authorized to transact property
2806	insurance in this state must shall provide coverage for a
2807	catastrophic ground cover collapse.
2808	(b)  The insurer and shall make available, for an
2809	appropriate additional premium, coverage for sinkhole losses on
2810	any structure, including the contents of personal property
2811	contained therein, to the extent provided in the form to which
2812	the coverage attaches. The insurer may require an inspection of
2813	the property before issuance of sinkhole loss coverage. A policy
2814	for residential property insurance may include a deductible
2815	amount applicable to sinkhole losses equal to 1 percent, 2
2816	percent, 5 percent, or 10 percent of the policy dwelling limits,
2817	with appropriate premium discounts offered with each deductible
2818	amount.
2819	(c)  The insurer may restrict catastrophic ground cover
2820	collapse and sinkhole loss coverage to the principal building,
2821	as defined in the applicable policy.
2822	(2)  As used in ss. 627.706-627.7074, and as used in
2823	connection with any policy providing coverage for a catastrophic
2824	ground cover collapse or for sinkhole losses, the term:
2825	(a)  "Catastrophic ground cover collapse" means geological
2826	activity that results in all the following:
2827	1.  The abrupt collapse of the ground cover;
2828	2.  A depression in the ground cover clearly visible to the
2829	naked eye;
2830	3.  Structural damage to the covered building, including
2831	the foundation; and
2832	4.  The insured structure being condemned and ordered to be
2833	vacated by the governmental agency authorized by law to issue
2834	such an order for that structure.
2835
2836	Contents coverage applies if there is a loss resulting from a
2837	catastrophic ground cover collapse. Structural Damage consisting
2838	merely of the settling or cracking of a foundation, structure,
2839	or building does not constitute a loss resulting from a
2840	catastrophic ground cover collapse.
2841	(b)  "Neutral evaluation" means the alternative dispute
2842	resolution provided in s. 627.7074.
2843	(c)  "Neutral evaluator" means a professional engineer or a
2844	professional geologist who has completed a course of study in
2845	alternative dispute resolution designed or approved by the
2846	department for use in the neutral evaluation process and who is
2847	determined by the department to be fair and impartial.
2848	(h)(b)  "Sinkhole" means a landform created by subsidence
2849	of soil, sediment, or rock as underlying strata are dissolved by
2850	groundwater. A sinkhole forms may form by collapse into
2851	subterranean voids created by dissolution of limestone or
2852	dolostone or by subsidence as these strata are dissolved.
2853	(j)(c)  "Sinkhole loss" means structural damage to the
2854	covered building, including the foundation, caused by sinkhole
2855	activity. Contents coverage and additional living expenses shall
2856	apply only if there is structural damage to the covered building
2857	caused by sinkhole activity.
2858	(i)(d)  "Sinkhole activity" means settlement or systematic
2859	weakening of the earth supporting the covered building such
2860	property only if the when such settlement or systematic
2861	weakening results from contemporaneous movement or raveling of
2862	soils, sediments, or rock materials into subterranean voids
2863	created by the effect of water on a limestone or similar rock
2864	formation.
2865	(f)(e)  "Professional engineer" means a person, as defined
2866	in s. 471.005, who has a bachelor's degree or higher in
2867	engineering with a specialty in the geotechnical engineering
2868	field. A professional engineer must also have geotechnical
2869	experience and expertise in the identification of sinkhole
2870	activity as well as other potential causes of structural damage
2871	to the structure.
2872	(g)(f)  "Professional geologist" means a person, as defined
2873	in by s. 492.102, who has a bachelor's degree or higher in
2874	geology or related earth science and with expertise in the
2875	geology of Florida. A professional geologist must have
2876	geological experience and expertise in the identification of
2877	sinkhole activity as well as other potential geologic causes of
2878	structural damage to the structure.
2879	(k)  "Structural damage" means a covered building,
2880	regardless of the date of its construction, has experienced the
2881	following:
2882	1.  Interior floor displacement or deflection in excess of
2883	acceptable variances as defined in ACI 117-90 or the Florida
2884	Building Code, which results in settlement related damage to the
2885	interior such that the interior building structure or members
2886	become unfit for service or represents a safety hazard as
2887	defined within the Florida Building Code;
2888	2.  Foundation displacement or deflection in excess of
2889	acceptable variances as defined in ACI 318-95 or the Florida
2890	Building Code, which results in settlement related damage to the
2891	primary structural members or primary structural systems that
2892	prevents those members or systems from supporting the loads and
2893	forces they were designed to support to the extent that stresses
2894	in those primary structural members or primary structural
2895	systems exceeds one and one-third the nominal strength allowed
2896	under the Florida Building Code for new buildings of similar
2897	structure, purpose, or location;
2898	3.  Damage that results in listing, leaning, or buckling of
2899	the exterior load bearing walls or other vertical primary
2900	structural members to such an extent that a plumb line passing
2901	through the center of gravity does not fall inside the middle
2902	one-third of the base as defined within the Florida Building
2903	Code;
2904	4.  Damage that results in the building, or any portion of
2905	the building containing primary structural members or primary
2906	structural systems, being significantly likely to imminently
2907	collapse because of the movement or instability of the ground
2908	within the influence zone of the supporting ground within the
2909	sheer plane necessary for the purpose of supporting such
2910	building as defined within the Florida Building Code; or
2911	5.  Damage occurring on or after October 15, 2005, that
2912	qualifies as "substantial structural damage" as defined in the
2913	Florida Building Code.
2914	(d)  "Primary structural member" means a structural element
2915	designed to provide support and stability for the vertical or
2916	lateral loads of the overall structure.
2917	(e)  "Primary structural system" means an assemblage of
2918	primary structural members.
2919	(3)  On or before June 1, 2007, Every insurer authorized to
2920	transact property insurance in this state shall make a proper
2921	filing with the office for the purpose of extending the
2922	appropriate forms of property insurance to include coverage for
2923	catastrophic ground cover collapse or for sinkhole losses.
2924	coverage for catastrophic ground cover collapse may not go into
2925	effect until the effective date provided for in the filing
2926	approved by the office.
2927	(3)(4)  Insurers offering policies that exclude coverage
2928	for sinkhole losses must shall inform policyholders in bold type
2929	of not less than 14 points as follows: "YOUR POLICY PROVIDES
2930	COVERAGE FOR A CATASTROPHIC GROUND COVER COLLAPSE THAT RESULTS
2931	IN THE PROPERTY BEING CONDEMNED AND UNINHABITABLE. OTHERWISE,
2932	YOUR POLICY DOES NOT PROVIDE COVERAGE FOR SINKHOLE LOSSES. YOU
2933	MAY PURCHASE ADDITIONAL COVERAGE FOR SINKHOLE LOSSES FOR AN
2934	ADDITIONAL PREMIUM."
2935	(4)(5)  An insurer offering sinkhole coverage to
2936	policyholders before or after the adoption of s. 30, chapter
2937	2007-1, Laws of Florida, may nonrenew the policies of
2938	policyholders maintaining sinkhole coverage in Pasco County or
2939	Hernando County, at the option of the insurer, and provide an
2940	offer of coverage that to such policyholders which includes
2941	catastrophic ground cover collapse and excludes sinkhole
2942	coverage. Insurers acting in accordance with this subsection are
2943	subject to the following requirements:
2944	(a)  Policyholders must be notified that a nonrenewal is
2945	for purposes of removing sinkhole coverage, and that the
2946	policyholder is still being offered a policy that provides
2947	coverage for catastrophic ground cover collapse.
2948	(b)  Policyholders must be provided an actuarially
2949	reasonable premium credit or discount for the removal of
2950	sinkhole coverage and provision of only catastrophic ground
2951	cover collapse.
2952	(c)  Subject to the provisions of this subsection and the
2953	insurer's approved underwriting or insurability guidelines, the
2954	insurer shall provide each policyholder with the opportunity to
2955	purchase an endorsement to his or her policy providing sinkhole
2956	coverage and may require an inspection of the property before
2957	issuance of a sinkhole coverage endorsement.
2958	(d)  Section 624.4305 does not apply to nonrenewal notices
2959	issued pursuant to this subsection.
2960	(5)  Any claim, including, but not limited to, initial,
2961	supplemental, and reopened claims under an insurance policy that
2962	provides sinkhole coverage is barred unless notice of the claim
2963	was given to the insurer in accordance with the terms of the
2964	policy within 2 years after the policyholder knew or reasonably
2965	should have known about the sinkhole loss.
2966	Section 23.  Section 627.7061, Florida Statutes, is amended
2967	to read:
2968	627.7061  Coverage inquiries.-Inquiries about coverage on a
2969	property insurance contract are not claim activity, unless an
2970	actual claim is filed by the policyholder which insured that
2971	results in a company investigation of the claim.
2972	Section 24.  Section 627.7065, Florida Statutes, is
2973	repealed.
2974	Section 25.  Section 627.707, Florida Statutes, is amended
2975	to read:
2976	627.707  Standards for Investigation of sinkhole claims by
2977	insurers; insurer payment; nonrenewals.-Upon receipt of a claim
2978	for a sinkhole loss to a covered building, an insurer must meet
2979	the following standards in investigating a claim:
2980	(1)  The insurer must inspect make an inspection of the
2981	policyholder's insured's premises to determine if there is
2982	structural has been physical damage that to the structure which
2983	may be the result of sinkhole activity.
2984	(2)  If the insurer confirms that structural damage exists
2985	but is unable to identify a valid cause of such damage or
2986	discovers that such damage is consistent with sinkhole loss
2987	Following the insurer's initial inspection, the insurer shall
2988	engage a professional engineer or a professional geologist to
2989	conduct testing as provided in s. 627.7072 to determine the
2990	cause of the loss within a reasonable professional probability
2991	and issue a report as provided in s. 627.7073, only if sinkhole
2992	loss is covered under the policy. Except as provided in
2993	subsections (4) and (6), the fees and costs of the professional
2994	engineer or professional geologist shall be paid by the
2995	insurer.:
2996	(a)  The insurer is unable to identify a valid cause of the
2997	damage or discovers damage to the structure which is consistent
2998	with sinkhole loss; or
2999	(b)  The policyholder demands testing in accordance with
3000	this section or s. 627.7072.
3001	(3)  Following the initial inspection of the policyholder's
3002	insured premises, the insurer shall provide written notice to
3003	the policyholder disclosing the following information:
3004	(a)  What the insurer has determined to be the cause of
3005	damage, if the insurer has made such a determination.
3006	(b)  A statement of the circumstances under which the
3007	insurer is required to engage a professional engineer or a
3008	professional geologist to verify or eliminate sinkhole loss and
3009	to engage a professional engineer to make recommendations
3010	regarding land and building stabilization and foundation repair.
3011	(c)  A statement regarding the right of the policyholder to
3012	request testing by a professional engineer or a professional
3013	geologist, and the circumstances under which the policyholder
3014	may demand certain testing, and the circumstances under which
3015	the policyholder may incur costs associated with testing.
3016	(4)(a)  If the insurer determines that there is no sinkhole
3017	loss, the insurer may deny the claim.
3018	(b)  If coverage for sinkhole loss is available and If the
3019	insurer denies the claim, without performing testing under s.
3020	627.7072, the policyholder may demand testing by the insurer
3021	under s. 627.7072.
3022	1.  The policyholder's demand for testing must be
3023	communicated to the insurer in writing within 60 days after the
3024	policyholder's receipt of the insurer's denial of the claim.
3025	2.  The policyholder shall pay 50 percent of the actual
3026	costs of the analyses and services provided under ss. 627.7072
3027	and 627.7073 or $2,500, whichever is less.
3028	3.  The insurer shall reimburse the policyholder for the
3029	costs if the insurer's engineer or geologist provides written
3030	certification pursuant to s. 627.7073 that there is sinkhole
3031	loss.
3032	(5)(a)  Subject to paragraph (b), If a sinkhole loss is
3033	verified, the insurer shall pay to stabilize the land and
3034	building and repair the foundation in accordance with the
3035	recommendations of the professional engineer retained pursuant
3036	to subsection (2), as provided under s. 627.7073, and in
3037	consultation with notice to the policyholder, subject to the
3038	coverage and terms of the policy. The insurer shall pay for
3039	other repairs to the structure and contents in accordance with
3040	the terms of the policy. If a covered building suffers a
3041	sinkhole loss or a catastrophic ground cover collapse, the
3042	insured must repair such damage or loss in accordance with the
3043	insurer's professional engineer's recommended repairs. However,
3044	if the insurer's professional engineer determines that the
3045	repair cannot be completed within policy limits, the insurer
3046	must pay to complete the repairs recommended by the insurer's
3047	professional engineer or tender the policy limits to the
3048	policyholder.
3049	(a)(b)  The insurer may limit its total claims payment to
3050	the actual cash value of the sinkhole loss, which does not
3051	include including underpinning or grouting or any other repair
3052	technique performed below the existing foundation of the
3053	building, until the policyholder enters into a contract for the
3054	performance of building stabilization or foundation repairs in
3055	accordance with the recommendations set forth in the insurer's
3056	report issued pursuant to s. 627.7073.
3057	(b)  In order to prevent additional damage to the building
3058	or structure, the policyholder must enter into a contract for
3059	the performance of building stabilization and foundation repairs
3060	within 90 days after the insurance company confirms coverage for
3061	the sinkhole loss and notifies the policyholder of such
3062	confirmation. This time period is tolled if either party invokes
3063	the neutral evaluation process, and begins again 10 days after
3064	the conclusion of the neutral evaluation process.
3065	(c)  After the policyholder enters into the contract for
3066	the performance of building stabilization and foundation
3067	repairs, the insurer shall pay the amounts necessary to begin
3068	and perform such repairs as the work is performed and the
3069	expenses are incurred. The insurer may not require the
3070	policyholder to advance payment for such repairs. If repair
3071	covered by a personal lines residential property insurance
3072	policy has begun and the professional engineer selected or
3073	approved by the insurer determines that the repair cannot be
3074	completed within the policy limits, the insurer must either
3075	complete the professional engineer's recommended repair or
3076	tender the policy limits to the policyholder without a reduction
3077	for the repair expenses incurred.
3078	(d)  The stabilization and all other repairs to the
3079	structure and contents must be completed within 12 months after
3080	entering into the contract for repairs described in paragraph
3081	(b) unless:
3082	1.  There is a mutual agreement between the insurer and the
3083	policyholder;
3084	2.  The claim is involved with the neutral evaluation
3085	process;
3086	3.  The claim is in litigation; or
3087	4.  The claim is under appraisal or mediation.
3088	(e)(c)  Upon the insurer's obtaining the written approval
3089	of the policyholder and any lienholder, the insurer may make
3090	payment directly to the persons selected by the policyholder to
3091	perform the land and building stabilization and foundation
3092	repairs. The decision by the insurer to make payment to such
3093	persons does not hold the insurer liable for the work performed.
3094	The policyholder may not accept a rebate from any person
3095	performing the repairs specified in this section. If a
3096	policyholder does receive a rebate, coverage is void and the
3097	policyholder must refund the amount of the rebate to the
3098	insurer. Any person making the repairs specified in this section
3099	who offers a rebate commits insurance fraud punishable as a
3100	third degree felony as provided in s. 775.082, s. 775.083, or s.
3101	775.084.
3102	(6)  Except as provided in subsection (7), the fees and
3103	costs of the professional engineer or the professional geologist
3104	shall be paid by the insurer.
3105	(6)(7)  If the insurer obtains, pursuant to s. 627.7073,
3106	written certification that there is no sinkhole loss or that the
3107	cause of the damage was not sinkhole activity, and if the
3108	policyholder has submitted the sinkhole claim without good faith
3109	grounds for submitting such claim, the policyholder shall
3110	reimburse the insurer for 50 percent of the actual costs of the
3111	analyses and services provided under ss. 627.7072 and 627.7073;
3112	however, a policyholder is not required to reimburse an insurer
3113	more than $2,500 with respect to any claim. A policyholder is
3114	required to pay reimbursement under this subsection only if the
3115	policyholder requested the analysis and services provided under
3116	ss. 627.7072 and 627.7073 and the insurer, before prior to
3117	ordering the analysis under s. 627.7072, informs the
3118	policyholder in writing of the policyholder's potential
3119	liability for reimbursement and gives the policyholder the
3120	opportunity to withdraw the claim.
3121	(7)(8)  An No insurer may not shall nonrenew any policy of
3122	property insurance on the basis of filing of claims for sinkhole
3123	partial loss if caused by sinkhole damage or clay shrinkage as
3124	long as the total of such payments does not equal or exceed the
3125	current policy limits of coverage for the policy in effect on
3126	the date of loss, for property damage to the covered building,
3127	as set forth on the declarations page, or if and provided the
3128	policyholder insured has repaired the structure in accordance
3129	with the engineering recommendations made pursuant to subsection
3130	(2) upon which any payment or policy proceeds were based. If the
3131	insurer pays such limits, it may nonrenew the policy.
3132	(8)(9)  The insurer may engage a professional structural
3133	engineer to make recommendations as to the repair of the
3134	structure.
3135	Section 26.  Section 627.7073, Florida Statutes, is amended
3136	to read:
3137	627.7073  Sinkhole reports.-
3138	(1)  Upon completion of testing as provided in s. 627.7072,
3139	the professional engineer or professional geologist shall issue
3140	a report and certification to the insurer and the policyholder
3141	as provided in this section.
3142	(a)  Sinkhole loss is verified if, based upon tests
3143	performed in accordance with s. 627.7072, a professional
3144	engineer or a professional geologist issues a written report and
3145	certification stating:
3146	1.  That structural damage to the covered building has been
3147	identified within a reasonable professional probability.
3148	2.1.  That the cause of the actual physical and structural
3149	damage is sinkhole activity within a reasonable professional
3150	probability.
3151	3.2.  That the analyses conducted were of sufficient scope
3152	to identify sinkhole activity as the cause of damage within a
3153	reasonable professional probability.
3154	4.3.  A description of the tests performed.
3155	5.4.  A recommendation by the professional engineer of
3156	methods for stabilizing the land and building and for making
3157	repairs to the foundation.
3158	(b)  If there is no structural damage or if sinkhole
3159	activity is eliminated as the cause of such damage to the
3160	covered building structure, the professional engineer or
3161	professional geologist shall issue a written report and
3162	certification to the policyholder and the insurer stating:
3163	1.  That there is no structural damage or the cause of such
3164	the damage is not sinkhole activity within a reasonable
3165	professional probability.
3166	2.  That the analyses and tests conducted were of
3167	sufficient scope to eliminate sinkhole activity as the cause of
3168	the structural damage within a reasonable professional
3169	probability.
3170	3.  A statement of the cause of the structural damage
3171	within a reasonable professional probability.
3172	4.  A description of the tests performed.
3173	(c)  The respective findings, opinions, and recommendations
3174	of the insurer's professional engineer or professional geologist
3175	as to the cause of distress to the property and the findings,
3176	opinions, and recommendations of the insurer's professional
3177	engineer as to land and building stabilization and foundation
3178	repair set forth by s. 627.7072 shall be presumed correct.
3179	(2)(a)  An Any insurer that has paid a claim for a sinkhole
3180	loss shall file a copy of the report and certification, prepared
3181	pursuant to subsection (1), including the legal description of
3182	the real property and the name of the property owner, the
3183	neutral evaluator's report, if any, which indicates that
3184	sinkhole activity caused the damage claimed, a copy of the
3185	certification indicating that stabilization has been completed,
3186	if applicable, and the amount of the payment, with the county
3187	clerk of court, who shall record the report and certification.
3188	The insurer shall bear the cost of filing and recording one or
3189	more reports and certifications the report and certification.
3190	There shall be no cause of action or liability against an
3191	insurer for compliance with this section.
3192	(a)  The recording of the report and certification does
3193	not:
3194	1.  Constitute a lien, encumbrance, or restriction on the
3195	title to the real property or constitute a defect in the title
3196	to the real property;
3197	2.  Create any cause of action or liability against any
3198	grantor of the real property for breach of any warranty of good
3199	title or warranty against encumbrances; or
3200	3.  Create any cause of action or liability against any
3201	title insurer that insures the title to the real property.
3202	(b)  As a precondition to accepting payment for a sinkhole
3203	loss, the policyholder must file a copy of any sinkhole report
3204	regarding the insured property which was prepared on behalf or
3205	at the request of the policyholder. The policyholder shall bear
3206	the cost of filing and recording the sinkhole report. The
3207	recording of the report does not:
3208	1.  Constitute a lien, encumbrance, or restriction on the
3209	title to the real property or constitute a defect in the title
3210	to the real property;
3211	2.  Create any cause of action or liability against any
3212	grantor of the real property for breach of any warranty of good
3213	title or warranty against encumbrances; or
3214	3.  Create any cause of action or liability against a title
3215	insurer that insures the title to the real property.
3216	(c)(b)  The seller of real property upon which a sinkhole
3217	claim has been made by the seller and paid by the insurer must
3218	shall disclose to the buyer of such property, before the
3219	closing, that a claim has been paid and whether or not the full
3220	amount of the proceeds were used to repair the sinkhole damage.
3221	(3)  Upon completion of any building stabilization or
3222	foundation repairs for a verified sinkhole loss, the
3223	professional engineer responsible for monitoring the repairs
3224	shall issue a report to the property owner which specifies what
3225	repairs have been performed and certifies within a reasonable
3226	degree of professional probability that such repairs have been
3227	properly performed. The professional engineer issuing the report
3228	shall file a copy of the report and certification, which
3229	includes a legal description of the real property and the name
3230	of the property owner, with the county clerk of the court, who
3231	shall record the report and certification. This subsection does
3232	not create liability for an insurer based on any representation
3233	or certification by a professional engineer related to the
3234	stabilization or foundation repairs for the verified sinkhole
3235	loss.
3236	Section 27.  Section 627.7074, Florida Statutes, is amended
3237	to read:
3238	627.7074  Alternative procedure for resolution of disputed
3239	sinkhole insurance claims.-
3240	(1)  As used in this section, the term:
3241	(a)  "Neutral evaluation" means the alternative dispute
3242	resolution provided for in this section.
3243	(b)  "Neutral evaluator" means a professional engineer or a
3244	professional geologist who has completed a course of study in
3245	alternative dispute resolution designed or approved by the
3246	department for use in the neutral evaluation process, who is
3247	determined to be fair and impartial.
3248	(1)(2)(a)  The department shall:
3249	(a)  Certify and maintain a list of persons who are neutral
3250	evaluators.
3251	(b)  The department shall Prepare a consumer information
3252	pamphlet for distribution by insurers to policyholders which
3253	clearly describes the neutral evaluation process and includes
3254	information and forms necessary for the policyholder to request
3255	a neutral evaluation.
3256	(2)  Neutral evaluation is available to either party if a
3257	sinkhole report has been issued pursuant to s. 627.7073. At a
3258	minimum, neutral evaluation must determine:
3259	(a)  Causation;
3260	(b)  All methods of stabilization and repair both above and
3261	below ground;
3262	(c)  The costs for stabilization and all repairs; and
3263	(d)  Information necessary to carry out subsection (12).
3264	(3)  Following the receipt of the report provided under s.
3265	627.7073 or the denial of a claim for a sinkhole loss, the
3266	insurer shall notify the policyholder of his or her right to
3267	participate in the neutral evaluation program under this
3268	section. Neutral evaluation supersedes the alternative dispute
3269	resolution process under s. 627.7015, but does not invalidate
3270	the appraisal clause of the insurance policy. The insurer shall
3271	provide to the policyholder the consumer information pamphlet
3272	prepared by the department pursuant to subsection (1)
3273	electronically or by United States mail paragraph (2)(b).
3274	(4)  Neutral evaluation is nonbinding, but mandatory if
3275	requested by either party. A request for neutral evaluation may
3276	be filed with the department by the policyholder or the insurer
3277	on a form approved by the department. The request for neutral
3278	evaluation must state the reason for the request and must
3279	include an explanation of all the issues in dispute at the time
3280	of the request. Filing a request for neutral evaluation tolls
3281	the applicable time requirements for filing suit for a period of
3282	60 days following the conclusion of the neutral evaluation
3283	process or the time prescribed in s. 95.11, whichever is later.
3284	(5)  Neutral evaluation shall be conducted as an informal
3285	process in which formal rules of evidence and procedure need not
3286	be observed. A party to neutral evaluation is not required to
3287	attend neutral evaluation if a representative of the party
3288	attends and has the authority to make a binding decision on
3289	behalf of the party. All parties shall participate in the
3290	evaluation in good faith. The neutral evaluator must be allowed
3291	reasonable access to the interior and exterior of insured
3292	structures to be evaluated or for which a claim has been made.
3293	Any reports initiated by the policyholder, or an agent of the
3294	policyholder, confirming a sinkhole loss or disputing another
3295	sinkhole report regarding insured structures must be provided to
3296	the neutral evaluator before the evaluator's physical inspection
3297	of the insured property.
3298	(6)  The insurer shall pay reasonable the costs associated
3299	with the neutral evaluation. However, if a party chooses to hire
3300	a court reporter or stenographer to contemporaneously record and
3301	document the neutral evaluation, that party must bear such
3302	costs.
3303	(7)  Upon receipt of a request for neutral evaluation, the
3304	department shall provide the parties a list of certified neutral
3305	evaluators. The parties shall mutually select a neutral
3306	evaluator from the list and promptly inform the department. If
3307	the parties cannot agree to a neutral evaluator within 10
3308	business days, The department shall allow the parties to submit
3309	requests to disqualify evaluators on the list for cause.
3310	(a)  The department shall disqualify neutral evaluators for
3311	cause based only on any of the following grounds:
3312	1.  A familial relationship exists between the neutral
3313	evaluator and either party or a representative of either party
3314	within the third degree.
3315	2.  The proposed neutral evaluator has, in a professional
3316	capacity, previously represented either party or a
3317	representative of either party, in the same or a substantially
3318	related matter.
3319	3.  The proposed neutral evaluator has, in a professional
3320	capacity, represented another person in the same or a
3321	substantially related matter and that person's interests are
3322	materially adverse to the interests of the parties. The term
3323	"substantially related matter" means participation by the
3324	neutral evaluator on the same claim, property, or adjacent
3325	property.
3326	4.  The proposed neutral evaluator has, within the
3327	preceding 5 years, worked as an employer or employee of any
3328	party to the case.
3329	(b)  The parties shall appoint a neutral evaluator from the
3330	department list and promptly inform the department. If the
3331	parties cannot agree to a neutral evaluator within 14 business
3332	days, the department shall appoint a neutral evaluator from the
3333	list of certified neutral evaluators. The department shall allow
3334	each party to disqualify two neutral evaluators without cause.
3335	Upon selection or appointment, the department shall promptly
3336	refer the request to the neutral evaluator.
3337	(c)  Within 14 5 business days after the referral, the
3338	neutral evaluator shall notify the policyholder and the insurer
3339	of the date, time, and place of the neutral evaluation
3340	conference. The conference may be held by telephone, if feasible
3341	and desirable. The neutral evaluator shall make reasonable
3342	efforts to hold the neutral evaluation conference shall be held
3343	within 90 45 days after the receipt of the request by the
3344	department. Failure of the neutral evaluator to hold the
3345	conference within 90 days does not invalidate either party's
3346	right to neutral evaluation or to a neutral evaluation
3347	conference held outside this timeframe.
3348	(8)  The department shall adopt rules of procedure for the
3349	neutral evaluation process.
3350	(8)(9)  For policyholders not represented by an attorney, a
3351	consumer affairs specialist of the department or an employee
3352	designated as the primary contact for consumers on issues
3353	relating to sinkholes under s. 20.121 shall be available for
3354	consultation to the extent that he or she may lawfully do so.
3355	(9)(10)  Evidence of an offer to settle a claim during the
3356	neutral evaluation process, as well as any relevant conduct or
3357	statements made in negotiations concerning the offer to settle a
3358	claim, is inadmissible to prove liability or absence of
3359	liability for the claim or its value, except as provided in
3360	subsection (14) (13).
3361	(10)(11)  Regardless of when noticed, any court proceeding
3362	related to the subject matter of the neutral evaluation shall be
3363	stayed pending completion of the neutral evaluation and for 5
3364	days after the filing of the neutral evaluator's report with the
3365	court.
3366	(11)  If, based upon his or her professional training and
3367	credentials, a neutral evaluator is qualified to determine only
3368	disputes relating to causation or method of repair, the
3369	department shall allow the neutral evaluator to enlist the
3370	assistance of another professional from the neutral evaluators
3371	list not previously stricken, who, based upon his or her
3372	professional training and credentials, is able to provide an
3373	opinion as to other disputed issues. A professional who would be
3374	disqualified for any reason listed in subsection (7) must be
3375	disqualified. The neutral evaluator may also use the services of
3376	professional engineers and professional geologists who are not
3377	certified as neutral evaluators, as well as licensed building
3378	contractors, in order to ensure that all items in dispute are
3379	addressed and the neutral evaluation can be completed. Any
3380	professional engineer, professional geologist, or licensed
3381	building contractor retained may be disqualified for any of the
3382	reasons listed in subsection (7). The neutral evaluator may
3383	request the entity that performed the investigation pursuant to
3384	s. 627.7072 perform such additional and reasonable testing as
3385	deemed necessary in the professional opinion of the neutral
3386	evaluator.
3387	(12)  At For matters that are not resolved by the parties
3388	at the conclusion of the neutral evaluation, the neutral
3389	evaluator shall prepare a report describing all matters that are
3390	the subject of the neutral evaluation, including whether,
3391	stating that in his or her opinion, the sinkhole loss has been
3392	verified or eliminated within a reasonable degree of
3393	professional probability and, if verified, whether the sinkhole
3394	activity caused structural damage to the covered building, and
3395	if so, the need for and estimated costs of stabilizing the land
3396	and any covered structures or buildings and other appropriate
3397	remediation or necessary building structural repairs due to the
3398	sinkhole loss. The evaluator's report shall be sent to all
3399	parties in attendance at the neutral evaluation and to the
3400	department, within 14 days after completing the neutral
3401	evaluation conference.
3402	(13)  The recommendation of the neutral evaluator is not
3403	binding on any party, and the parties retain access to the
3404	court. The neutral evaluator's written recommendation, oral
3405	testimony, and full report shall be admitted is admissible in
3406	any subsequent action, litigation, or proceeding relating to the
3407	claim or to the cause of action giving rise to the claim.
3408	(14)  If the neutral evaluator first verifies the existence
3409	of a sinkhole that caused structural damage and, second,
3410	recommends the need for and estimates costs of stabilizing the
3411	land and any covered structures or buildings and other
3412	appropriate remediation or building structural repairs, which
3413	costs exceed the amount that the insurer has offered to pay the
3414	policyholder, the insurer is liable to the policyholder for up
3415	to $2,500 in attorney's fees for the attorney's participation in
3416	the neutral evaluation process. For purposes of this subsection,
3417	the term "offer to pay" means a written offer signed by the
3418	insurer or its legal representative and delivered to the
3419	policyholder within 10 days after the insurer receives notice
3420	that a request for neutral evaluation has been made under this
3421	section.
3422	(15)  If the insurer timely agrees in writing to comply and
3423	timely complies with the recommendation of the neutral
3424	evaluator, but the policyholder declines to resolve the matter
3425	in accordance with the recommendation of the neutral evaluator
3426	pursuant to this section:
3427	(a)  The insurer is not liable for extracontractual damages
3428	related to a claim for a sinkhole loss but only as related to
3429	the issues determined by the neutral evaluation process. This
3430	section does not affect or impair claims for extracontractual
3431	damages unrelated to the issues determined by the neutral
3432	evaluation process contained in this section; and
3433	(b)  The actions of the insurer are not a confession of
3434	judgment or admission of liability, and the insurer is not
3435	liable for attorney's fees under s. 627.428 or other provisions
3436	of the insurance code unless the policyholder obtains a judgment
3437	that is more favorable than the recommendation of the neutral
3438	evaluator.
3439	(16)  If the insurer agrees to comply with the neutral
3440	evaluator's report, payments shall be made in accordance with
3441	the terms and conditions of the applicable insurance policy
3442	pursuant to s. 627.707(5).
3443	(17)  Neutral evaluators are deemed to be agents of the
3444	department and have immunity from suit as provided in s. 44.107.
3445	(18)  The department shall adopt rules of procedure for the
3446	neutral evaluation process.
3447	Section 28.  Subsection (8) of section 627.711, Florida
3448	Statutes, is amended to read:
3449	627.711  Notice of premium discounts for hurricane loss
3450	mitigation; uniform mitigation verification inspection form.-
3451	(8)  At its expense, the insurer may require that a any
3452	uniform mitigation verification form provided by a policyholder,
3453	a policyholder's agent, or an authorized mitigation inspector or
3454	inspection company be independently verified by an inspector, an
3455	inspection company, or an independent third-party quality
3456	assurance provider which possesses does possess a quality
3457	assurance program before prior to accepting the uniform
3458	mitigation verification form as valid.
3459	Section 29.  Subsection (1) of section 627.712, Florida
3460	Statutes, is amended to read:
3461	627.712  Residential windstorm coverage required;
3462	availability of exclusions for windstorm or contents.-
3463	(1)  An insurer issuing a residential property insurance
3464	policy must provide windstorm coverage. Except as provided in
3465	paragraph (2)(c), this section does not apply with respect to
3466	risks that are eligible for wind-only coverage from Citizens
3467	Property Insurance Corporation under s. 627.351(6), and with
3468	respect to risks that are not eligible for coverage from
3469	Citizens Property Insurance Corporation under s. 627.351(6)(a)3.
3470	or 5. A risk ineligible for Citizens coverage by the corporation
3471	under s. 627.351(6)(a)3. or 5. is exempt from the requirements
3472	of this section only if the risk is located within the
3473	boundaries of the coastal high-risk account of the corporation.
3474	Section 30.  Subsection (3) of section 631.54, Florida
3475	Statutes, is amended to read:
3476	631.54  Definitions.-As used in this part:
3477	(3)  "Covered claim" means an unpaid claim, including one
3478	of unearned premiums, which arises out of, and is within the
3479	coverage, and not in excess of, the applicable limits of an
3480	insurance policy to which this part applies, issued by an
3481	insurer, if such insurer becomes an insolvent insurer and the
3482	claimant or insured is a resident of this state at the time of
3483	the insured event or the property from which the claim arises is
3484	permanently located in this state. For entities other than
3485	individuals, the residence of a claimant, insured, or
3486	policyholder is the state in which the entity's principal place
3487	of business is located at the time of the insured event. The
3488	term does "Covered claim" shall not include:
3489	(a)  Any amount due any reinsurer, insurer, insurance pool,
3490	or underwriting association, sought directly or indirectly
3491	through a third party, as subrogation, contribution,
3492	indemnification, or otherwise; or
3493	(b)  Any claim that would otherwise be a covered claim
3494	under this part that has been rejected by any other state
3495	guaranty fund on the grounds that an insured's net worth is
3496	greater than that allowed under that state's guaranty law.
3497	Member insurers shall have no right of subrogation,
3498	contribution, indemnification, or otherwise, sought directly or
3499	indirectly through a third party, against the insured of any
3500	insolvent member; or
3501	(c)  Any amount payable for a sinkhole loss other than
3502	testing deemed appropriate by the association or payable for the
3503	actual repair of the loss, except that the association may not
3504	pay for attorney's fees or public adjuster's fees in connection
3505	with a sinkhole loss or pay the policyholder. The association
3506	may pay for actual repairs to the property, but is not liable
3507	for amounts in excess of policy limits.
3508	Section 31.  If any provision of this act, or the
3509	application thereof to any person or circumstance is held
3510	invalid, such invalidity shall not affect other provisions or
3511	applications of this act which can be given effect without the
3512	invalid provision or application. It is the express intent of
3513	the Legislature to enact multiple important, but independent,
3514	reforms to Florida law relating to sinkhole insurance coverage
3515	and related claims. The Legislature further intends that the
3516	multiple reforms in the act could and should be enforced if one
3517	or more provisions are held invalid. To this end, the provisions
3518	of this act are declared to be severable.
3519	Section 32.  Except as otherwise expressly provided in this
3520	act, this act shall take effect upon becoming a law.
3521
3522
3523	-----------------------------------------------------
3524	T I T L E  A M E N D M E N T
3525	Remove the entire title and insert:
3526	A bill to be entitled
3527	An act relating to property and casualty insurance;
3528	amending s. 95.11, F.S.; specifying a statute of
3529	limitation for a breach of a property insurance contract
3530	runs from the date of loss; amending s. 215.555, F.S.;
3531	revising the definition of "losses," relating to the
3532	Florida Hurricane Catastrophe Fund, to include and exclude
3533	certain losses; providing applicability; amending s.
3534	215.5595, F.S.; authorizing an insurer to renegotiate the
3535	terms a surplus note issued before a certain date;
3536	providing limitations; amending s. 624.407, F.S.; revising
3537	the amount of surplus funds required for domestic insurers
3538	applying for a certificate of authority; amending s.
3539	624.408, F.S.; revising the minimum surplus that must be
3540	maintained by certain insurers; authorizing the Office of
3541	Insurance Regulation to reduce the surplus requirement
3542	under specified circumstances; amending s. 626.854, F.S.;
3543	providing limitations on the amount of compensation that
3544	may be received by a public adjuster for a reopened or
3545	supplemental claim; providing limitations on the amount of
3546	compensation that may be received by a public adjuster for
3547	a claim; applying specified provisions regulating the
3548	conduct of public adjusters to condominium unit owners
3549	rather than to condominium associations as is currently
3550	required; providing statements that may be considered
3551	deceptive or misleading if made in any public adjuster's
3552	advertisement or solicitation; providing a definition for
3553	the term "written advertisement"; requiring that a
3554	disclaimer be included in any public adjuster's written
3555	advertisement; providing requirements for such disclaimer;
3556	requiring certain persons who act on behalf of an insurer
3557	to provide notice to the insurer, claimant, public
3558	adjuster, or legal representative for an onsite inspection
3559	of the insured property; authorizing the insured or
3560	claimant to deny access to the property if notice is not
3561	provided; requiring the public adjuster to ensure prompt
3562	notice of certain property loss claims; providing that an
3563	insurer be allowed to interview the insured directly about
3564	the loss claim; prohibiting the insurer from obstructing
3565	or preventing the public adjuster from communicating with
3566	the insured; requiring that the insurer communicate with
3567	the public adjuster in an effort to reach an agreement as
3568	to the scope of the covered loss under the insurance
3569	policy; prohibiting a public adjuster from restricting or
3570	preventing persons acting on behalf of the insured from
3571	having reasonable access to the insured or the insured's
3572	property; prohibiting a public adjuster from restricting
3573	or preventing the insured's adjuster from having
3574	reasonable access to or inspecting the insured's property;
3575	authorizing the insured's adjuster to be present for the
3576	inspection; prohibiting a licensed contractor or
3577	subcontractor from adjusting a claim on behalf of an
3578	insured if such contractor or subcontractor is not a
3579	licensed public adjuster; providing an exception; amending
3580	s. 626.8796, F.S.; providing requirements for a public
3581	adjuster contract; creating s. 626.70132, F.S.; requiring
3582	that notice of a claim, supplemental claim, or reopened
3583	claim be given to the insurer within a specified period
3584	after a windstorm or hurricane occurs; providing a
3585	definition for the terms "supplemental claim" or "reopened
3586	claim"; providing applicability; repealing s. 627.0613(4),
3587	F.S., relating to the requirement that the consumer
3588	advocate for the Chief Financial Officer prepare an annual
3589	report card for each personal residential property
3590	insurer; amending s. 627.062, F.S.; extending the
3591	expiration date for making a "file and use" filing;
3592	prohibiting the Office of Insurance Regulation from,
3593	directly or indirectly, impeding the right of an insurer
3594	to acquire policyholders, advertise or appoint agents, or
3595	regulate agent commissions; revising the information that
3596	must be included in a rate filing relating to certain
3597	reinsurance or financing products; deleting a provision
3598	that prohibited an insurer from making certain rate
3599	filings within a certain period of time after a rate
3600	increase; deleting a provision prohibiting an insurer from
3601	filing for a rate increase within 6 months after it makes
3602	certain rate filings; deleting obsolete provisions
3603	relating to legislation enacted during the 2003 Special
3604	Session D of the Legislature; providing for the submission
3605	of additional or supplementary information pursuant to a
3606	rate filing; revising provisions relating to the
3607	certifications that are required to be made under oath by
3608	certain officers or actuaries of an insurer regarding
3609	information that must accompany a rate filing; amending s.
3610	627.06281, F.S.; providing limitations on fees charged for
3611	use of the public hurricane model; amending s. 627.0629,
3612	F.S.; deleting obsolete provisions; deleting a requirement
3613	that the Office of Insurance Regulation propose a method
3614	for establishing discounts, debits, credits, and other
3615	rate differentials for hurricane mitigation by a certain
3616	date; conforming provisions to changes made by the act;
3617	amending s. 627.351, F.S.; limiting an adjuster's fee for
3618	a claim against the corporation; renaming the "high-risk
3619	account" as the "coastal account"; revising the conditions
3620	under which the Citizens policyholder surcharge may be
3621	imposed; providing that members of the Citizens Property
3622	Insurance Corporation Board of Governors are not
3623	prohibited from practicing in a certain profession if not
3624	prohibited by law or ordinance; requiring the corporation
3625	to commission a consultant to prepare a report on
3626	outsourcing various functions and to submit such report to
3627	the Financial Services Commission by a certain date;
3628	limiting coverage for damage from sinkholes after a
3629	certain date; requiring the policyholders to sign a
3630	statement acknowledging that they may be assessed
3631	surcharges to cover corporate deficits; prohibiting board
3632	members from voting on certain measures; exempting
3633	sinkhole coverage from the corporation's annual rate
3634	increase requirements; deleting a requirement that the
3635	board provide an annual report to the Legislature relating
3636	to certain coverages; deleting a requirement that the
3637	board reduce the boundaries of certain high-risk areas
3638	eligible for wind-only coverages under certain
3639	circumstances; amending s. 627.3511, F.S.; conforming
3640	provisions to changes made by the act; amending s.
3641	627.4133, F.S.; revising the requirements for providing an
3642	insured with notice of nonrenewal, cancellation, or
3643	termination of personal lines or commercial residential
3644	property insurance; authorizing an insurer to cancel
3645	policies after 45 days' notice if the Office of Insurance
3646	Regulation determines that the cancellation of policies is
3647	necessary to protect the interests of the public or
3648	policyholders; authorizing the Office of Insurance
3649	Regulation to place an insurer under administrative
3650	supervision or appoint a receiver upon the consent of the
3651	insurer under certain circumstances; providing criteria
3652	and notice requirements relating to the nonrenewal of
3653	policy covering both a home and motor vehicle; creating s.
3654	627.43141, F.S.; providing definitions; requiring the
3655	delivery of a "Notice of Change in Policy Terms" under
3656	certain circumstances; specifying requirements for such
3657	notice; specifying actions constituting proof of notice;
3658	authorizing policy renewals to contain a change in policy
3659	terms; providing that receipt of payment by an insurer is
3660	deemed acceptance of new policy terms by an insured;
3661	providing that the original policy remains in effect until
3662	the occurrence of specified events if an insurer fails to
3663	provide notice; providing intent; amending s. 627.7011,
3664	F.S.; requiring the insurer to pay the actual cash value
3665	of an insured loss for a dwelling, less any applicable
3666	deductible; requiring the insurer to offer coverage under
3667	which the insurer is obligated to pay replacement costs;
3668	authorizing the insurer to offer coverage that limits the
3669	initial payment for personal property to the actual cash
3670	value of the property to be replaced and to require the
3671	insured to provide receipts for purchases; requiring the
3672	insurer to provide notice of this process before the
3673	policy is bound; requiring certain premium credits or
3674	discounts for such coverage; prohibiting an insurer from
3675	requiring the insured to advance payment; amending s.
3676	627.70131, F.S.; specifying application of certain time
3677	periods to initial or supplemental property insurance
3678	claim notices and payments; providing legislative findings
3679	with respect to 2005 statutory changes relating to
3680	sinkhole insurance coverage and statutory changes in this
3681	act; amending s. 627.706, F.S.; authorizing an insurer to
3682	limit coverage for catastrophic ground cover collapse to
3683	the principal building; authorizing an insurer to require
3684	an inspection before issuance of sinkhole loss coverage;
3685	revising definitions; defining the term "structural
3686	damage"; placing a 2-year statute of repose on claims for
3687	sinkhole coverage; amending s. 627.7061, F.S.; conforming
3688	provisions to changes made by the act; repealing s.
3689	627.7065, F.S., relating to the establishment of a
3690	sinkhole database; amending s. 627.707, F.S.; revising
3691	provisions relating to the investigation of sinkholes by
3692	insurers; providing a time limitation for demanding
3693	sinkhole testing by a policyholder and entering into a
3694	contract for repairs; requiring the insurer to provide
3695	repairs in accordance with the insurer's engineer's
3696	recommendations or tender the policy limits to the
3697	policyholder; requiring all repairs to be completed within
3698	a certain time; providing exceptions; providing criminal
3699	penalties for a person performing repairs who offers a
3700	rebate; amending s. 627.7073, F.S.; revising provisions
3701	relating to inspection reports; revising the reports that
3702	an insurer must file with the clerk of the court;
3703	requiring the policyholder to file certain reports as a
3704	precondition to accepting payment; requiring the
3705	professional engineer responsible for monitoring sinkhole
3706	repairs to issue a report and certification to the
3707	property owner and file such report with the court;
3708	providing that the act does not create liability for an
3709	insurer based on a representation or certification by the
3710	engineer; amending s. 627.7074, F.S.; revising provisions
3711	relating to neutral evaluation; requiring evaluation in
3712	order to make certain determinations; requiring that the
3713	neutral evaluator be allowed access to structures being
3714	evaluated; providing grounds for disqualifying an
3715	evaluator; allowing the Department of Financial Services
3716	to appoint an evaluator if the parties cannot come to
3717	agreement; revising the timeframes for scheduling a
3718	neutral evaluation conference; authorizing an evaluator to
3719	enlist another evaluator or other professionals; providing
3720	a time certain for issuing a report; requiring admission
3721	of certain information relating to the neutral evaluation
3722	into evidence; revising provisions relating to compliance
3723	with the evaluator's recommendations; providing that the
3724	evaluator is an agent of the department for the purposes
3725	of immunity from suit; requiring the department to adopt
3726	rules; amending s. 627.711, F.S.; revising the requirement
3727	that the insurer pay for verification of a uniform
3728	mitigation verification form that the insurer requires;
3729	amending s. 627.712, F.S.; conforming provisions to
3730	changes made by the act; amending s. 631.54, F.S.;
3731	revising the definition of the term "covered claim" for
3732	purposes of the Florida Insurance Guaranty Association
3733	Act; providing for applicability; providing severability;
3734	providing effective dates.

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