CS/CS/HB 803

1	A bill to be entitled
2	An act relating to property and casualty insurance;
3	amending s. 95.11, F.S.; providing a statute of
4	limitations for breach of a property insurance contract;
5	specifying the time for commencement of a statute of
6	limitations for breach of a property insurance contract;
7	amending s. 215.555, F.S.; providing that specified losses
8	are excluded from the definition of the term "losses" as
9	used in certain provisions relating to the Florida
10	Hurricane Catastrophe Fund; providing for application of
11	the revisions made by this act to the term "losses";
12	amending s. 215.5595, F.S.; authorizing an insurer to
13	renegotiate the terms of a surplus note issued before a
14	certain date; amending s. 624.407, F.S.; revising the
15	amount of surplus funds required for domestic insurers
16	applying for a certificate of authority after a certain
17	date; amending s. 624.408, F.S.; revising the minimum
18	surplus that must be maintained by certain insurers;
19	authorizing the Office of Insurance Regulation to reduce
20	specified surplus requirements under specified
21	circumstances; amending s. 626.852, F.S.; providing an
22	exemption from licensure as an adjuster to certain persons
23	who provide mortgage-related claims adjusting services to
24	certain institutions; providing an exception to the
25	exemption; amending s. 626.854, F.S.; providing
26	limitations on the amount of compensation that may be
27	received by a public adjuster for a reopened or
28	supplemental claim; providing limitations on the amount of
29	compensation that may be received by a public adjuster for
30	a claim; applying specified provisions regulating the
31	conduct of public adjusters to condominium unit owners
32	rather than to condominium associations as is currently
33	required; providing statements that may be considered
34	deceptive or misleading if made in any public adjuster's
35	advertisement or solicitation; providing a definition for
36	the term "written advertisement"; requiring that a
37	disclaimer be included in any public adjuster's written
38	advertisement; providing requirements for such disclaimer;
39	requiring certain persons who act on behalf of an insurer
40	to provide notice to the insurer, claimant, public
41	adjuster, or legal representative for an onsite inspection
42	of the insured property; authorizing the insured or
43	claimant to deny access to the property if notice is not
44	provided; requiring the public adjuster to ensure prompt
45	notice of certain property loss claims; providing that an
46	insurer be allowed to interview the insured directly about
47	the loss claim; prohibiting the insurer from excluding the
48	public adjuster from the insurer's meetings with the
49	insured; requiring that the insurer communicate with the
50	public adjuster in an effort to reach an agreement as to
51	the scope of the covered loss under the insurance policy;
52	prohibiting a public adjuster from restricting or
53	preventing persons acting on behalf of the insurer from
54	having reasonable access to the insured or the insured's
55	property; prohibiting a public adjuster from unreasonably
56	obstructing or preventing the insurer's adjuster from
57	timely conducting an inspection of the insured's property;
58	authorizing the insured's adjuster to be present for the
59	inspection; providing an exception to such authorization
60	under certain circumstances; prohibiting a licensed
61	contractor or subcontractor from adjusting a claim on
62	behalf of an insured if such contractor or subcontractor
63	is not a licensed public adjuster; providing an exception;
64	creating s. 626.70132, F.S.; requiring that notice of a
65	claim, supplemental claim, or reopened claim be given to
66	the insurer within a specified period after the date of
67	loss; providing a definition for the terms "supplemental
68	claim" or "reopened claim"; providing applicability;
69	amending s. 627.062, F.S.; extending the expiration date
70	for making a "file and use" filing; deleting an obsolete
71	provision; prohibiting the Office of Insurance Regulation
72	from, directly or indirectly, impeding the right of an
73	insurer to acquire policyholders, advertise or appoint
74	agents, or regulate agent commissions for property and
75	casualty insurance; revising the costs that may be
76	included in a rate filing; revising the overall premium
77	increase for a rate filing; revising the information that
78	must be included in a rate filing relating to reinsurance;
79	deleting a provision prohibiting an insurer from
80	implementing a rate increase within 6 months before it
81	makes certain rate filings; deleting a provision
82	prohibiting an insurer from filing for a rate increase
83	within 6 months after it makes certain rate filings;
84	deleting obsolete provisions relating to legislation
85	enacted during the 2003 Special Session D of the
86	Legislature; revising provisions relating to the
87	certifications that are required to be made under oath by
88	certain officers or actuaries of an insurer regarding
89	information that must accompany a rate filing; amending s.
90	627.06281, F.S.; providing limitations relating to the
91	fees charged for use of the public hurricane model;
92	providing an exception to the fees; amending s. 627.0629,
93	F.S.; revising legislative intent; deleting obsolete
94	provisions; deleting a requirement that the Office of
95	Insurance Regulation propose a method for establishing
96	discounts, debits, credits, and other rate differentials
97	for hurricane mitigation by a certain date; conforming
98	provisions to changes made by the act; amending s.
99	627.4133, F.S.; reducing the amount of time that a prior
100	notice must provide to specified policyholders before a
101	nonrenewal, cancellation, or termination becomes
102	effective; authorizing an insurer to cancel policies after
103	45 days' notice if the Office of Insurance Regulation
104	determines that the cancellation of policies is necessary
105	to protect the interests of the public or policyholders;
106	creating s. 627.43141, F.S.; providing definitions;
107	requiring the delivery of a "Notice of Change in Policy
108	Terms" under certain circumstances; specifying
109	requirements for such notice; specifying actions
110	constituting proof of notice; authorizing policy renewals
111	to contain a change in policy terms; providing that
112	receipt of payment by an insurer is deemed acceptance of
113	new policy terms by an insured; providing that the
114	original policy remains in effect until the occurrence of
115	specified events if an insurer fails to provide notice;
116	providing intent; amending s. 627.7011, F.S.; revising
117	provisions relating to an insurer's payment of replacement
118	costs without reservation or holdback of any depreciation
119	in value if a loss occurs; amending s. 627.70131, F.S.;
120	specifying application of certain time periods to initial,
121	reopened, or supplemental property insurance claim notices
122	and payments; providing legislative findings with respect
123	to 2005 statutory changes relating to sinkhole insurance
124	coverage and statutory changes in this act; providing
125	legislative intent relating to sinkholes; amending s.
126	627.706, F.S.; authorizing an insurer to require an
127	inspection of property before issuing sinkhole coverage;
128	authorizing an insurer to limit coverage for catastrophic
129	ground cover collapse and sinkhole loss to the principal
130	building; revising definitions relating to sinkhole
131	coverage; providing definitions relating to sinkhole
132	coverage for the terms "neutral evaluation," "neutral
133	evaluator," and "structural damage"; revising
134	applicability of nonrenewals for sinkhole coverage;
135	placing a 4-year statute of repose on claims for sinkhole
136	coverage; repealing s. 627.7065, F.S., relating to the
137	establishment of a sinkhole database; amending s. 627.707,
138	F.S.; revising provisions relating to the investigation of
139	sinkholes by insurers; providing a time limitation for
140	demanding sinkhole testing by a policyholder and entering
141	into a contract for repairs; requiring payment for
142	analyses and services; allowing for reimbursement of
143	payment for analyses and services; requiring all repairs
144	to be completed within a certain time; providing
145	exceptions; prohibiting rebates to policyholders from
146	persons performing repairs; voiding coverage if a rebate
147	is received; requiring policyholders to refund rebates
148	from persons performing repairs to insurers; providing
149	criminal penalties applicable to persons performing
150	repairs who offer or policyholders who accept rebates;
151	limiting a policyholder's liability for reimbursement of
152	the costs related to certain analyses and services under
153	certain circumstances; amending s. 627.7073, F.S.;
154	revising provisions relating to sinkhole inspection
155	reports; requiring an insurer to file a neutral
156	evaluator's report and other specific information;
157	requiring the policyholder to file certain reports as a
158	precondition to accepting payment; requiring certain
159	filing and recording costs to be borne by a policyholder;
160	specifying that a policyholder's recording of a report
161	does not legally affect title or create certain causes of
162	action relating to real property; amending s. 627.7074,
163	F.S.; revising provisions relating to neutral evaluation
164	of sinkhole insurance claims; requiring evaluation in
165	order to make certain determinations; requiring that the
166	neutral evaluator be allowed access to structures being
167	evaluated; providing grounds for disqualifying an
168	evaluator; allowing the Department of Financial Services
169	to appoint an evaluator if the parties cannot come to
170	agreement; revising the timeframes for scheduling a
171	neutral evaluation conference; authorizing an evaluator to
172	enlist another evaluator or other professionals; providing
173	a time certain for issuing a report; revising provisions
174	relating to compliance with the evaluator's
175	recommendations; providing that the evaluator is an agent
176	of the department for the purposes of immunity from suit;
177	requiring the department to adopt rules; amending s.
178	627.711, F.S.; allowing an insurer to independently verify
179	mitigation forms from additional sources; amending s.
180	631.54, F.S.; revising the definition of the term "covered
181	claim" for purposes of the Florida Insurance Guaranty
182	Association Act; providing severability; providing
183	effective dates.
184
185	Be It Enacted by the Legislature of the State of Florida:
186
187	Section 1.  Subsection (11) is added to section 95.11,
188	Florida Statutes, to read:
189	95.11  Limitations other than for the recovery of real
190	property.-Actions other than for recovery of real property shall
191	be commenced as follows:
192	(11)  WITHIN SIX YEARS.-Notwithstanding paragraph (2)(b),
193	an action for breach of a property insurance contract, with the
194	period running from the date of loss.
195	Section 2.  Paragraph (d) of subsection (2) of section
196	215.555, Florida Statutes, is amended to read:
197	215.555  Florida Hurricane Catastrophe Fund.-
198	(2)  DEFINITIONS.-As used in this section:
199	(d)  "Losses" means direct incurred losses under covered
200	policies, including which shall include losses for additional
201	living expenses not to exceed 40 percent of the insured value of
202	a residential structure or its contents and shall exclude loss
203	adjustment expenses. The term "Losses" does not include:
204	1.  Losses for fair rental value, loss of rent or rental
205	income, or business interruption losses;.
206	2.  Losses under liability coverages;
207	3.  Property losses that are proximately caused by any
208	peril other than a covered event, including, but not limited to,
209	fire, theft, flood or rising water, or a windstorm that does not
210	constitute a covered event;
211	4.  Amounts paid as the result of a voluntary expansion of
212	coverage by the insurer, including, but not limited to, a waiver
213	of an applicable deductible;
214	5.  Amounts paid to reimburse a policyholder for
215	condominium association or homeowners' association loss
216	assessments or under similar coverages for contractual
217	liabilities;
218	6.  Amounts paid as bad faith awards, punitive damage
219	awards, or other court-imposed fines, sanctions, or penalties;
220	7.  Amounts in excess of the coverage limits under the
221	covered policy; or
222	8.  Allocated or unallocated loss adjustment expenses.
223	Section 3.  The amendments made by this act to s. 215.555,
224	Florida Statutes, apply first to the Florida Hurricane
225	Catastrophe Fund reimbursement contract that takes effect on
226	June 1, 2011.
227	Section 4.  Subsection (12) is added to section 215.5595,
228	Florida Statutes, to read:
229	215.5595  Insurance Capital Build-Up Incentive Program.-
230	(12)  The insurer may request that the board renegotiate
231	the terms of any surplus note that was issued under this section
232	before January 1, 2011. The request must be submitted to the
233	board by January 1, 2012. If the insurer agrees to accelerate
234	the payment period of the note by at least 5 years, the board
235	must agree to exempt the insurer from the premium-to-surplus
236	ratios required under paragraph (2)(d). If the insurer agrees to
237	an acceleration of the payment period for less than 5 years, the
238	board may, after consultation with the Office of Insurance
239	Regulation, agree to an appropriate revision of the premium-to-
240	surplus ratios required under paragraph (2)(d) for the remaining
241	term of the note if the revised ratios are not lower than a
242	minimum writing ratio of net premium to surplus of at least 1 to
243	1 and, alternatively, a minimum writing ratio of gross premium
244	to surplus of at least 3 to 1.
245	Section 5.  Section 624.407, Florida Statutes, is amended
246	to read:
247	624.407  Surplus Capital funds required; new insurers.-
248	(1)  To receive authority to transact any one kind or
249	combinations of kinds of insurance, as defined in part V of this
250	chapter, an insurer applying for its original certificate of
251	authority in this state after November 10, 1993, the effective
252	date of this section shall possess surplus as to policyholders
253	at least not less than the greater of:
254	(a)  Five million dollars For a property and casualty
255	insurer, $5 million, or $2.5 million for any other insurer;
256	(b)  For life insurers, 4 percent of the insurer's total
257	liabilities;
258	(c)  For life and health insurers, 4 percent of the
259	insurer's total liabilities, plus 6 percent of the insurer's
260	liabilities relative to health insurance; or
261	(d)  For all insurers other than life insurers and life and
262	health insurers, 10 percent of the insurer's total liabilities;
263	or
264	(e)  Notwithstanding paragraph (a) or paragraph (d), for a
265	domestic insurer that transacts residential property insurance
266	and is:
267	1.  Not a wholly owned subsidiary of an insurer domiciled
268	in any other state, $15 million.
269	2.  however, a domestic insurer that transacts residential
270	property insurance and is A wholly owned subsidiary of an
271	insurer domiciled in any other state, shall possess surplus as
272	to policyholders of at least $50 million.
273	(2)  Notwithstanding subsection (1), a new insurer may not
274	be required, but no insurer shall be required under this
275	subsection to have surplus as to policyholders greater than $100
276	million.
277	(3)(2)  The requirements of this section shall be based
278	upon all the kinds of insurance actually transacted or to be
279	transacted by the insurer in any and all areas in which it
280	operates, whether or not only a portion of such kinds of
281	insurance are to be transacted in this state.
282	(4)(3)  As to surplus as to policyholders required for
283	qualification to transact one or more kinds of insurance,
284	domestic mutual insurers are governed by chapter 628, and
285	domestic reciprocal insurers are governed by chapter 629.
286	(5)(4)  For the purposes of this section, liabilities do
287	shall not include liabilities required under s. 625.041(4). For
288	purposes of computing minimum surplus as to policyholders
289	pursuant to s. 625.305(1), liabilities shall include liabilities
290	required under s. 625.041(4).
291	(6)(5)  The provisions of this section, as amended by
292	chapter 89-360, Laws of Florida this act, shall apply only to
293	insurers applying for a certificate of authority on or after
294	October 1, 1989 the effective date of this act.
295	Section 6.  Section 624.408, Florida Statutes, is amended
296	to read:
297	624.408  Surplus as to policyholders required; current new
298	and existing insurers.-
299	(1)(a)  To maintain a certificate of authority to transact
300	any one kind or combinations of kinds of insurance, as defined
301	in part V of this chapter, an insurer in this state must shall
302	at all times maintain surplus as to policyholders at least not
303	less than the greater of:
304	(a)1.  Except as provided in paragraphs (e), (f), and (g)
305	subparagraph 5. and paragraph (b), $1.5 million.;
306	(b)2.  For life insurers, 4 percent of the insurer's total
307	liabilities.;
308	(c)3.  For life and health insurers, 4 percent of the
309	insurer's total liabilities plus 6 percent of the insurer's
310	liabilities relative to health insurance.; or
311	(d)4.  For all insurers other than mortgage guaranty
312	insurers, life insurers, and life and health insurers, 10
313	percent of the insurer's total liabilities.
314	(e)5.  For property and casualty insurers, $4 million,
315	except for property and casualty insurers authorized to
316	underwrite any line of residential property insurance.
317	(f)(b)  For residential any property insurers not and
318	casualty insurer holding a certificate of authority before July
319	1, 2011 on December 1, 1993, $15 million. the
320	(g)  For residential property insurers holding a
321	certificate of authority before July 1, 2011, and until June 30,
322	2016, $5 million; on or after July 1, 2016, and until June 30,
323	2021, $10 million; on or after July 1, 2021, $15 million.
324
325	The office may reduce the surplus requirement in paragraphs (f)
326	and (g) if the insurer is not writing new business, has premiums
327	in force of less than $1 million per year in residential
328	property insurance, or is a mutual insurance company. following
329	amounts apply instead of the $4 million required by subparagraph
330	(a)5.:
331	1.  On December 31, 2001, and until December 30, 2002, $3
332	million.
333	2.  On December 31, 2002, and until December 30, 2003,
334	$3.25 million.
335	3.  On December 31, 2003, and until December 30, 2004, $3.6
336	million.
337	4.  On December 31, 2004, and thereafter, $4 million.
338	(2)  For purposes of this section, liabilities do shall not
339	include liabilities required under s. 625.041(4). For purposes
340	of computing minimum surplus as to policyholders pursuant to s.
341	625.305(1), liabilities shall include liabilities required under
342	s. 625.041(4).
343	(3)  This section does not require an No insurer shall be
344	required under this section to have surplus as to policyholders
345	greater than $100 million.
346	(4)  A mortgage guaranty insurer shall maintain a minimum
347	surplus as required by s. 635.042.
348	Section 7.  Subsection (7) is added to section 626.852,
349	Florida Statutes, to read:
350	626.852  Scope of this part.-
351	(7)  Notwithstanding any other provision of law, a person
352	providing claims adjusting services solely to institutions
353	servicing or guaranteeing mortgages shall be exempt from
354	licensure as an adjuster for services provided to the mortgage
355	institution with regards to policies covering the mortgaged
356	properties. This exemption does not apply to any person
357	providing insurance or property repair or preservation services
358	or to any affiliate of such persons.
359	Section 8.  Effective June 1, 2011, section 626.854,
360	Florida Statutes, is amended to read:
361	626.854  "Public adjuster" defined; prohibitions.-The
362	Legislature finds that it is necessary for the protection of the
363	public to regulate public insurance adjusters and to prevent the
364	unauthorized practice of law.
365	(1)  A "public adjuster" is any person, except a duly
366	licensed attorney at law as hereinafter in s. 626.860 provided,
367	who, for money, commission, or any other thing of value,
368	prepares, completes, or files an insurance claim form for an
369	insured or third-party claimant or who, for money, commission,
370	or any other thing of value, acts or aids in any manner on
371	behalf of an insured or third-party claimant in negotiating for
372	or effecting the settlement of a claim or claims for loss or
373	damage covered by an insurance contract or who advertises for
374	employment as an adjuster of such claims, and also includes any
375	person who, for money, commission, or any other thing of value,
376	solicits, investigates, or adjusts such claims on behalf of any
377	such public adjuster.
378	(2)  This definition does not apply to:
379	(a)  A licensed health care provider or employee thereof
380	who prepares or files a health insurance claim form on behalf of
381	a patient.
382	(b)  A person who files a health claim on behalf of another
383	and does so without compensation.
384	(3)  A public adjuster may not give legal advice. A public
385	adjuster may not act on behalf of or aid any person in
386	negotiating or settling a claim relating to bodily injury,
387	death, or noneconomic damages.
388	(4)  For purposes of this section, the term "insured"
389	includes only the policyholder and any beneficiaries named or
390	similarly identified in the policy.
391	(5)  A public adjuster may not directly or indirectly
392	through any other person or entity solicit an insured or
393	claimant by any means except on Monday through Saturday of each
394	week and only between the hours of 8 a.m. and 8 p.m. on those
395	days.
396	(6)  A public adjuster may not directly or indirectly
397	through any other person or entity initiate contact or engage in
398	face-to-face or telephonic solicitation or enter into a contract
399	with any insured or claimant under an insurance policy until at
400	least 48 hours after the occurrence of an event that may be the
401	subject of a claim under the insurance policy unless contact is
402	initiated by the insured or claimant.
403	(7)  An insured or claimant may cancel a public adjuster's
404	contract to adjust a claim without penalty or obligation within
405	3 business days after the date on which the contract is executed
406	or within 3 business days after the date on which the insured or
407	claimant has notified the insurer of the claim, by phone or in
408	writing, whichever is later. The public adjuster's contract
409	shall disclose to the insured or claimant his or her right to
410	cancel the contract and advise the insured or claimant that
411	notice of cancellation must be submitted in writing and sent by
412	certified mail, return receipt requested, or other form of
413	mailing which provides proof thereof, to the public adjuster at
414	the address specified in the contract; provided, during any
415	state of emergency as declared by the Governor and for a period
416	of 1 year after the date of loss, the insured or claimant shall
417	have 5 business days after the date on which the contract is
418	executed to cancel a public adjuster's contract.
419	(8)  It is an unfair and deceptive insurance trade practice
420	pursuant to s. 626.9541 for a public adjuster or any other
421	person to circulate or disseminate any advertisement,
422	announcement, or statement containing any assertion,
423	representation, or statement with respect to the business of
424	insurance which is untrue, deceptive, or misleading.
425	(9)  A public adjuster, a public adjuster apprentice, or
426	any person or entity acting on behalf of a public adjuster or
427	public adjuster apprentice may not give or offer to give a
428	monetary loan or advance to a client or prospective client.
429	(10)  A public adjuster, public adjuster apprentice, or any
430	individual or entity acting on behalf of a public adjuster or
431	public adjuster apprentice may not give or offer to give,
432	directly or indirectly, any article of merchandise having a
433	value in excess of $25 to any individual for the purpose of
434	advertising or as an inducement to entering into a contract with
435	a public adjuster.
436	(11)(a)  If a public adjuster enters into a contract with
437	an insured or claimant to reopen a claim or to file a
438	supplemental claim that seeks additional payments for a claim
439	that has been previously paid in part or in full or settled by
440	the insurer, the public adjuster may not charge, agree to, or
441	accept any compensation, payment, commission, fee, or other
442	thing of value based on a previous settlement or previous claim
443	payments by the insurer for the same cause of loss. The charge,
444	compensation, payment, commission, fee, or other thing of value
445	may be based only on the claim payments or settlement obtained
446	through the work of the public adjuster after entering into the
447	contract with the insured or claimant. Compensation for the
448	reopened or supplemental claim may not exceed 20 percent of the
449	reopened or supplemental claim payment. The contracts described
450	in this paragraph are not subject to the limitations in
451	paragraph (b).
452	(b)  A public adjuster may not charge, agree to, or accept
453	any compensation, payment, commission, fee, or other thing of
454	value in excess of:
455	1.  Ten percent of the amount of insurance claim payments
456	made by the insurer for claims based on events that are the
457	subject of a declaration of a state of emergency by the
458	Governor. This provision applies to claims made during the
459	period of 1 year after the declaration of emergency. After that
460	1-year period, 20 percent of the amount of insurance claim
461	payments made by the insurer.
462	2.  Twenty percent of the amount of all other insurance
463	claim payments made by the insurer for claims that are not based
464	on events that are the subject of a declaration of a state of
465	emergency by the Governor.
466	(12)  Each public adjuster shall provide to the claimant or
467	insured a written estimate of the loss to assist in the
468	submission of a proof of loss or any other claim for payment of
469	insurance proceeds. The public adjuster shall retain such
470	written estimate for at least 5 years and shall make such
471	estimate available to the claimant or insured and the department
472	upon request.
473	(13)  A public adjuster, public adjuster apprentice, or any
474	person acting on behalf of a public adjuster or apprentice may
475	not accept referrals of business from any person with whom the
476	public adjuster conducts business if there is any form or manner
477	of agreement to compensate the person, whether directly or
478	indirectly, for referring business to the public adjuster. A
479	public adjuster may not compensate any person, except for
480	another public adjuster, whether directly or indirectly, for the
481	principal purpose of referring business to the public adjuster.
482
483	The provisions of subsections (5)-(13) apply only to residential
484	property insurance policies and condominium unit owner
485	association policies as defined in s. 718.111(11).
486	Section 9.  Effective January 1, 2012, section 626.854,
487	Florida Statutes, as amended by this act, is amended to read:
488	626.854  "Public adjuster" defined; prohibitions.-The
489	Legislature finds that it is necessary for the protection of the
490	public to regulate public insurance adjusters and to prevent the
491	unauthorized practice of law.
492	(1)  A "public adjuster" is any person, except a duly
493	licensed attorney at law as exempted under hereinafter in s.
494	626.860 provided, who, for money, commission, or any other thing
495	of value, prepares, completes, or files an insurance claim form
496	for an insured or third-party claimant or who, for money,
497	commission, or any other thing of value, acts or aids in any
498	manner on behalf of, or aids an insured or third-party claimant
499	in negotiating for or effecting the settlement of a claim or
500	claims for loss or damage covered by an insurance contract or
501	who advertises for employment as an adjuster of such claims. The
502	term, and also includes any person who, for money, commission,
503	or any other thing of value, solicits, investigates, or adjusts
504	such claims on behalf of a any such public adjuster.
505	(2)  This definition does not apply to:
506	(a)  A licensed health care provider or employee thereof
507	who prepares or files a health insurance claim form on behalf of
508	a patient.
509	(b)  A person who files a health claim on behalf of another
510	and does so without compensation.
511	(3)  A public adjuster may not give legal advice or. A
512	public adjuster may not act on behalf of or aid any person in
513	negotiating or settling a claim relating to bodily injury,
514	death, or noneconomic damages.
515	(4)  For purposes of this section, the term "insured"
516	includes only the policyholder and any beneficiaries named or
517	similarly identified in the policy.
518	(5)  A public adjuster may not directly or indirectly
519	through any other person or entity solicit an insured or
520	claimant by any means except on Monday through Saturday of each
521	week and only between the hours of 8 a.m. and 8 p.m. on those
522	days.
523	(6)  A public adjuster may not directly or indirectly
524	through any other person or entity initiate contact or engage in
525	face-to-face or telephonic solicitation or enter into a contract
526	with any insured or claimant under an insurance policy until at
527	least 48 hours after the occurrence of an event that may be the
528	subject of a claim under the insurance policy unless contact is
529	initiated by the insured or claimant.
530	(7)  An insured or claimant may cancel a public adjuster's
531	contract to adjust a claim without penalty or obligation within
532	3 business days after the date on which the contract is executed
533	or within 3 business days after the date on which the insured or
534	claimant has notified the insurer of the claim, by phone or in
535	writing, whichever is later. The public adjuster's contract must
536	shall disclose to the insured or claimant his or her right to
537	cancel the contract and advise the insured or claimant that
538	notice of cancellation must be submitted in writing and sent by
539	certified mail, return receipt requested, or other form of
540	mailing that which provides proof thereof, to the public
541	adjuster at the address specified in the contract; provided,
542	during any state of emergency as declared by the Governor and
543	for a period of 1 year after the date of loss, the insured or
544	claimant has shall have 5 business days after the date on which
545	the contract is executed to cancel a public adjuster's contract.
546	(8)  It is an unfair and deceptive insurance trade practice
547	pursuant to s. 626.9541 for a public adjuster or any other
548	person to circulate or disseminate any advertisement,
549	announcement, or statement containing any assertion,
550	representation, or statement with respect to the business of
551	insurance which is untrue, deceptive, or misleading.
552	(a)  The following statements, made in any public
553	adjuster's advertisement or solicitation, are considered
554	deceptive or misleading:
555	1.  A statement or representation that invites an insured
556	policyholder to submit a claim when the policyholder does not
557	have covered damage to insured property.
558	2.  A statement or representation that invites an insured
559	policyholder to submit a claim by offering monetary or other
560	valuable inducement.
561	3.  A statement or representation that invites an insured
562	policyholder to submit a claim by stating that there is "no
563	risk" to the policyholder by submitting such claim.
564	4.  A statement or representation, or use of a logo or
565	shield, that implies or could mistakenly be construed to imply
566	that the solicitation was issued or distributed by a
567	governmental agency or is sanctioned or endorsed by a
568	governmental agency.
569	(b)  For purposes of this paragraph, the term "written
570	advertisement" includes only newspapers, magazines, flyers, and
571	bulk mailers. The following disclaimer, which is not required to
572	be printed on standard size business cards, must be added in
573	bold print and capital letters in typeface no smaller than the
574	typeface of the body of the text to all written advertisements
575	by a public adjuster:
576
577	"THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD
578	A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU
579	ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU
580	MAY DISREGARD THIS ADVERTISEMENT."
581
582	(9)  A public adjuster, a public adjuster apprentice, or
583	any person or entity acting on behalf of a public adjuster or
584	public adjuster apprentice may not give or offer to give a
585	monetary loan or advance to a client or prospective client.
586	(10)  A public adjuster, public adjuster apprentice, or any
587	individual or entity acting on behalf of a public adjuster or
588	public adjuster apprentice may not give or offer to give,
589	directly or indirectly, any article of merchandise having a
590	value in excess of $25 to any individual for the purpose of
591	advertising or as an inducement to entering into a contract with
592	a public adjuster.
593	(11)(a)  If a public adjuster enters into a contract with
594	an insured or claimant to reopen a claim or file a supplemental
595	claim that seeks additional payments for a claim that has been
596	previously paid in part or in full or settled by the insurer,
597	the public adjuster may not charge, agree to, or accept any
598	compensation, payment, commission, fee, or other thing of value
599	based on a previous settlement or previous claim payments by the
600	insurer for the same cause of loss. The charge, compensation,
601	payment, commission, fee, or other thing of value may be based
602	only on the claim payments or settlement obtained through the
603	work of the public adjuster after entering into the contract
604	with the insured or claimant. Compensation for the reopened or
605	supplemental claim may not exceed 20 percent of the reopened or
606	supplemental claim payment. The contracts described in this
607	paragraph are not subject to the limitations in paragraph (b).
608	(b)  A public adjuster may not charge, agree to, or accept
609	any compensation, payment, commission, fee, or other thing of
610	value in excess of:
611	1.  Ten percent of the amount of insurance claim payments
612	made by the insurer for claims based on events that are the
613	subject of a declaration of a state of emergency by the
614	Governor. This provision applies to claims made during the
615	period of 1 year after the declaration of emergency. After that
616	1-year period, 20 percent of the amount of insurance claim
617	payments made by the insurer.
618	2.  Twenty percent of the amount of insurance claim
619	payments made by the insurer for claims that are not based on
620	events that are the subject of a declaration of a state of
621	emergency by the Governor.
622	(12)  Each public adjuster must shall provide to the
623	claimant or insured a written estimate of the loss to assist in
624	the submission of a proof of loss or any other claim for payment
625	of insurance proceeds. The public adjuster shall retain such
626	written estimate for at least 5 years and shall make the such
627	estimate available to the claimant or insured and the department
628	upon request.
629	(13)  A public adjuster, public adjuster apprentice, or any
630	person acting on behalf of a public adjuster or apprentice may
631	not accept referrals of business from any person with whom the
632	public adjuster conducts business if there is any form or manner
633	of agreement to compensate the person, whether directly or
634	indirectly, for referring business to the public adjuster. A
635	public adjuster may not compensate any person, except for
636	another public adjuster, whether directly or indirectly, for the
637	principal purpose of referring business to the public adjuster.
638	(14)  A company employee adjuster, independent adjuster,
639	attorney, investigator, or other persons acting on behalf of an
640	insurer that needs access to an insured or claimant or to the
641	insured property that is the subject of a claim must provide at
642	least 48 hours' notice to the insured or claimant, public
643	adjuster, or legal representative before scheduling a meeting
644	with the claimant or an onsite inspection of the insured
645	property. The insured or claimant may deny access to the
646	property if the notice has not been provided. The insured or
647	claimant may waive the 48-hour notice.
648	(15)  A public adjuster must ensure prompt notice of
649	property loss claims submitted to an insurer by or through a
650	public adjuster or on which a public adjuster represents the
651	insured at the time the claim or notice of loss is submitted to
652	the insurer. The public adjuster must ensure that notice is
653	given to the insurer, the public adjuster's contract is provided
654	to the insurer, the property is available for inspection of the
655	loss or damage by the insurer, and the insurer is given an
656	opportunity to interview the insured directly about the loss and
657	claim. The insurer must be allowed to obtain necessary
658	information to investigate and respond to the claim.
659	(a)  The insurer may not exclude the public adjuster from
660	its in-person meetings with the insured. The insurer shall meet
661	or communicate with the public adjuster in an effort to reach
662	agreement as to the scope of the covered loss under the
663	insurance policy. This section does not impair the terms and
664	conditions of the insurance policy in effect at the time the
665	claim is filed.
666	(b)  A public adjuster may not restrict or prevent an
667	insurer, company employee adjuster, independent adjuster,
668	attorney, investigator, or other person acting on behalf of the
669	insurer from having reasonable access at reasonable times to an
670	insured or claimant or to the insured property that is the
671	subject of a claim.
672	(c)  A public adjuster may not act or fail to reasonably
673	act in any manner that obstructs or prevents an insurer or
674	insurer's adjuster from timely conducting an inspection of any
675	part of the insured property for which there is a claim for loss
676	or damage. The public adjuster representing the insured may be
677	present for the insurer's inspection, but if the unavailability
678	of the public adjuster otherwise delays the insurer's timely
679	inspection of the property, the public adjuster or the insured
680	must allow the insurer to have access to the property without
681	the participation or presence of the public adjuster or insured
682	in order to facilitate the insurer's prompt inspection of the
683	loss or damage.
684	(16)  A licensed contractor under part I of chapter 489, or
685	a subcontractor, may not adjust a claim on behalf of an insured
686	unless licensed and compliant as a public adjuster under this
687	chapter. However, the contractor may discuss or explain a bid
688	for construction or repair of covered property with the
689	residential property owner who has suffered loss or damage
690	covered by a property insurance policy, or the insurer of such
691	property, if the contractor is doing so for the usual and
692	customary fees applicable to the work to be performed as stated
693	in the contract between the contractor and the insured.
694	(17)  The provisions of subsections (5)-(16) (5)-(13) apply
695	only to residential property insurance policies and condominium
696	unit owner policies as defined in s. 718.111(11).
697	Section 10.  Effective June 1, 2011, section 626.70132,
698	Florida Statutes, is created to read:
699	626.70132  Notice of property insurance claim.-Except as
700	provided in s. 627.706(5), a claim, supplemental claim, or
701	reopened claim under an insurance policy that provides property
702	insurance, as defined in s. 624.604, is barred unless notice of
703	the claim, supplemental claim, or reopened claim was given to
704	the insurer in accordance with the terms of the policy within 4
705	years after the date of loss that caused the covered damage. For
706	purposes of this section, the term "supplemental claim" or
707	"reopened claim" means any additional claim for recovery from
708	the insurer for losses from the same peril which the insurer has
709	previously adjusted pursuant to the initial claim. This section
710	does not affect any applicable limitation on civil actions
711	provided in s. 95.11 for claims, supplemental claims, or
712	reopened claims timely filed under this section.
713	Section 11.  Section 627.062, Florida Statutes, is amended
714	to read:
715	627.062  Rate standards.-
716	(1)  The rates for all classes of insurance to which the
717	provisions of this part are applicable may shall not be
718	excessive, inadequate, or unfairly discriminatory.
719	(2)  As to all such classes of insurance:
720	(a)  Insurers or rating organizations shall establish and
721	use rates, rating schedules, or rating manuals that to allow the
722	insurer a reasonable rate of return on the such classes of
723	insurance written in this state. A copy of rates, rating
724	schedules, rating manuals, premium credits or discount
725	schedules, and surcharge schedules, and changes thereto, must
726	shall be filed with the office under one of the following
727	procedures except as provided in subparagraph 3.:
728	1.  If the filing is made at least 90 days before the
729	proposed effective date and the filing is not implemented during
730	the office's review of the filing and any proceeding and
731	judicial review, then such filing is shall be considered a "file
732	and use" filing. In such case, the office shall finalize its
733	review by issuance of a notice of intent to approve or a notice
734	of intent to disapprove within 90 days after receipt of the
735	filing. The notice of intent to approve and the notice of intent
736	to disapprove constitute agency action for purposes of the
737	Administrative Procedure Act. Requests for supporting
738	information, requests for mathematical or mechanical
739	corrections, or notification to the insurer by the office of its
740	preliminary findings does shall not toll the 90-day period
741	during any such proceedings and subsequent judicial review. The
742	rate shall be deemed approved if the office does not issue a
743	notice of intent to approve or a notice of intent to disapprove
744	within 90 days after receipt of the filing.
745	2.  If the filing is not made in accordance with the
746	provisions of subparagraph 1., such filing must shall be made as
747	soon as practicable, but within no later than 30 days after the
748	effective date, and is shall be considered a "use and file"
749	filing. An insurer making a "use and file" filing is potentially
750	subject to an order by the office to return to policyholders
751	those portions of rates found to be excessive, as provided in
752	paragraph (h).
753	3.  For all property insurance filings made or submitted
754	after January 25, 2007, but before May 1, 2012 December 31,
755	2010, an insurer seeking a rate that is greater than the rate
756	most recently approved by the office shall make a "file and use"
757	filing. For purposes of this subparagraph, motor vehicle
758	collision and comprehensive coverages are not considered to be
759	property coverages.
760	(b)  Upon receiving a rate filing, the office shall review
761	the rate filing to determine if a rate is excessive, inadequate,
762	or unfairly discriminatory. In making that determination, the
763	office shall, in accordance with generally accepted and
764	reasonable actuarial techniques, consider the following factors:
765	1.  Past and prospective loss experience within and without
766	this state.
767	2.  Past and prospective expenses.
768	3.  The degree of competition among insurers for the risk
769	insured.
770	4.  Investment income reasonably expected by the insurer,
771	consistent with the insurer's investment practices, from
772	investable premiums anticipated in the filing, plus any other
773	expected income from currently invested assets representing the
774	amount expected on unearned premium reserves and loss reserves.
775	The commission may adopt rules using reasonable techniques of
776	actuarial science and economics to specify the manner in which
777	insurers shall calculate investment income attributable to such
778	classes of insurance written in this state and the manner in
779	which such investment income is shall be used to calculate
780	insurance rates. Such manner must shall contemplate allowances
781	for an underwriting profit factor and full consideration of
782	investment income which produce a reasonable rate of return;
783	however, investment income from invested surplus may not be
784	considered.
785	5.  The reasonableness of the judgment reflected in the
786	filing.
787	6.  Dividends, savings, or unabsorbed premium deposits
788	allowed or returned to Florida policyholders, members, or
789	subscribers.
790	7.  The adequacy of loss reserves.
791	8.  The cost of reinsurance. The office may shall not
792	disapprove a rate as excessive solely due to the insurer having
793	obtained catastrophic reinsurance to cover the insurer's
794	estimated 250-year probable maximum loss or any lower level of
795	loss.
796	9.  Trend factors, including trends in actual losses per
797	insured unit for the insurer making the filing.
798	10.  Conflagration and catastrophe hazards, if applicable.
799	11.  Projected hurricane losses, if applicable, which must
800	be estimated using a model or method found to be acceptable or
801	reliable by the Florida Commission on Hurricane Loss Projection
802	Methodology, and as further provided in s. 627.0628.
803	12.  A reasonable margin for underwriting profit and
804	contingencies.
805	13.  The cost of medical services, if applicable.
806	14.  Other relevant factors that affect which impact upon
807	the frequency or severity of claims or upon expenses.
808	(c)  In the case of fire insurance rates, consideration
809	must shall be given to the availability of water supplies and
810	the experience of the fire insurance business during a period of
811	not less than the most recent 5-year period for which such
812	experience is available.
813	(d)  If conflagration or catastrophe hazards are considered
814	given consideration by an insurer in its rates or rating plan,
815	including surcharges and discounts, the insurer shall establish
816	a reserve for that portion of the premium allocated to such
817	hazard and shall maintain the premium in a catastrophe reserve.
818	Any Removal of such premiums from the reserve for purposes other
819	than paying claims associated with a catastrophe or purchasing
820	reinsurance for catastrophes must be approved by shall be
821	subject to approval of the office. Any ceding commission
822	received by an insurer purchasing reinsurance for catastrophes
823	must shall be placed in the catastrophe reserve.
824	(e)  After consideration of the rate factors provided in
825	paragraphs (b), (c), and (d), the office may find a rate may be
826	found by the office to be excessive, inadequate, or unfairly
827	discriminatory based upon the following standards:
828	1.  Rates shall be deemed excessive if they are likely to
829	produce a profit from Florida business which that is
830	unreasonably high in relation to the risk involved in the class
831	of business or if expenses are unreasonably high in relation to
832	services rendered.
833	2.  Rates shall be deemed excessive if, among other things,
834	the rate structure established by a stock insurance company
835	provides for replenishment of surpluses from premiums, if when
836	the replenishment is attributable to investment losses.
837	3.  Rates shall be deemed inadequate if they are clearly
838	insufficient, together with the investment income attributable
839	to them, to sustain projected losses and expenses in the class
840	of business to which they apply.
841	4.  A rating plan, including discounts, credits, or
842	surcharges, shall be deemed unfairly discriminatory if it fails
843	to clearly and equitably reflect consideration of the
844	policyholder's participation in a risk management program
845	adopted pursuant to s. 627.0625.
846	5.  A rate shall be deemed inadequate as to the premium
847	charged to a risk or group of risks if discounts or credits are
848	allowed which exceed a reasonable reflection of expense savings
849	and reasonably expected loss experience from the risk or group
850	of risks.
851	6.  A rate shall be deemed unfairly discriminatory as to a
852	risk or group of risks if the application of premium discounts,
853	credits, or surcharges among such risks does not bear a
854	reasonable relationship to the expected loss and expense
855	experience among the various risks.
856	(f)  In reviewing a rate filing, the office may require the
857	insurer to provide, at the insurer's expense, all information
858	necessary to evaluate the condition of the company and the
859	reasonableness of the filing according to the criteria
860	enumerated in this section.
861	(g)  The office may at any time review a rate, rating
862	schedule, rating manual, or rate change; the pertinent records
863	of the insurer; and market conditions. If the office finds on a
864	preliminary basis that a rate may be excessive, inadequate, or
865	unfairly discriminatory, the office shall initiate proceedings
866	to disapprove the rate and shall so notify the insurer. However,
867	the office may not disapprove as excessive any rate for which it
868	has given final approval or which has been deemed approved for a
869	period of 1 year after the effective date of the filing unless
870	the office finds that a material misrepresentation or material
871	error was made by the insurer or was contained in the filing.
872	Upon being so notified, the insurer or rating organization
873	shall, within 60 days, file with the office all information that
874	which, in the belief of the insurer or organization, proves the
875	reasonableness, adequacy, and fairness of the rate or rate
876	change. The office shall issue a notice of intent to approve or
877	a notice of intent to disapprove pursuant to the procedures of
878	paragraph (a) within 90 days after receipt of the insurer's
879	initial response. In such instances and in any administrative
880	proceeding relating to the legality of the rate, the insurer or
881	rating organization shall carry the burden of proof by a
882	preponderance of the evidence to show that the rate is not
883	excessive, inadequate, or unfairly discriminatory. After the
884	office notifies an insurer that a rate may be excessive,
885	inadequate, or unfairly discriminatory, unless the office
886	withdraws the notification, the insurer may shall not alter the
887	rate except to conform to with the office's notice until the
888	earlier of 120 days after the date the notification was provided
889	or 180 days after the date of implementing the implementation of
890	the rate. The office may, subject to chapter 120, may disapprove
891	without the 60-day notification any rate increase filed by an
892	insurer within the prohibited time period or during the time
893	that the legality of the increased rate is being contested.
894	(h)  If In the event the office finds that a rate or rate
895	change is excessive, inadequate, or unfairly discriminatory, the
896	office shall issue an order of disapproval specifying that a new
897	rate or rate schedule, which responds to the findings of the
898	office, be filed by the insurer. The office shall further order,
899	for any "use and file" filing made in accordance with
900	subparagraph (a)2., that premiums charged each policyholder
901	constituting the portion of the rate above that which was
902	actuarially justified be returned to the such policyholder in
903	the form of a credit or refund. If the office finds that an
904	insurer's rate or rate change is inadequate, the new rate or
905	rate schedule filed with the office in response to such a
906	finding is shall be applicable only to new or renewal business
907	of the insurer written on or after the effective date of the
908	responsive filing.
909	(i)  Except as otherwise specifically provided in this
910	chapter, the office may shall not, directly or indirectly:
911	1.  Prohibit any insurer, including any residual market
912	plan or joint underwriting association, from paying acquisition
913	costs based on the full amount of premium, as defined in s.
914	627.403, applicable to any policy, or prohibit any such insurer
915	from including the full amount of acquisition costs in a rate
916	filing; or.
917	2.  Impede, abridge, or otherwise compromise an insurer's
918	right to acquire policyholders, advertise, or appoint agents,
919	including the calculation, manner, or amount of such agent
920	commissions, if any, in property and casualty insurance.
921	(j)  With respect to residential property insurance rate
922	filings, the rate filing must account for mitigation measures
923	undertaken by policyholders to reduce hurricane losses.
924	(k)1.  A residential property An insurer may make a
925	separate filing limited solely to an adjustment of its rates for
926	reinsurance, the cost of financing products used as a
927	replacement for reinsurance, or financing costs incurred in the
928	purchase of reinsurance, or financing products to replace or
929	finance the payment of the amount covered by the Temporary
930	Increase in Coverage Limits (TICL) portion of the Florida
931	Hurricane Catastrophe Fund including replacement reinsurance for
932	the TICL reductions made pursuant to s. 215.555(17)(e); the
933	actual cost paid due to the application of the TICL premium
934	factor pursuant to s. 215.555(17)(f); and the actual cost paid
935	due to the application of the cash build-up factor pursuant to
936	s. 215.555(5)(b) if the insurer:
937	a.  Elects to purchase financing products such as a
938	liquidity instrument or line of credit, in which case the cost
939	included in the filing for the liquidity instrument or line of
940	credit may not result in a premium increase exceeding 3 percent
941	for any individual policyholder. All costs contained in the
942	filing may not result in an overall premium increase of more
943	than 15 10 percent for any individual policyholder.
944	b.  Includes in the filing a copy of all of its
945	reinsurance, liquidity instrument, or line of credit contracts;
946	proof of the billing or payment for the contracts; and the
947	calculation upon which the proposed rate change is based
948	demonstrating demonstrates that the costs meet the criteria of
949	this section and are not loaded for expenses or profit for the
950	insurer making the filing.
951	c.  Includes no other changes to its rates in the filing.
952	d.  Has not implemented a rate increase within the 6 months
953	immediately preceding the filing.
954	e.  Does not file for a rate increase under any other
955	paragraph within 6 months after making a filing under this
956	paragraph.
957	2.f.  An insurer that purchases reinsurance or financing
958	products from an affiliated company may make a separate filing
959	in compliance with this paragraph does so only if the costs for
960	such reinsurance or financing products are charged at or below
961	charges made for comparable coverage by nonaffiliated reinsurers
962	or financial entities making such coverage or financing products
963	available in this state.
964	3.2.  An insurer may only make only one filing per in any
965	12-month period under this paragraph.
966	4.3.  An insurer that elects to implement a rate change
967	under this paragraph must file its rate filing with the office
968	at least 45 days before the effective date of the rate change.
969	After an insurer submits a complete filing that meets all of the
970	requirements of this paragraph, the office has 45 days after the
971	date of the filing to review the rate filing and determine if
972	the rate is excessive, inadequate, or unfairly discriminatory.
973
974	The provisions of This subsection does shall not apply to
975	workers' compensation, and employer's liability insurance, and
976	to motor vehicle insurance.
977	(3)(a)  For individual risks that are not rated in
978	accordance with the insurer's rates, rating schedules, rating
979	manuals, and underwriting rules filed with the office and that
980	which have been submitted to the insurer for individual rating,
981	the insurer must maintain documentation on each risk subject to
982	individual risk rating. The documentation must identify the
983	named insured and specify the characteristics and classification
984	of the risk supporting the reason for the risk being
985	individually risk rated, including any modifications to existing
986	approved forms to be used on the risk. The insurer must maintain
987	these records for a period of at least 5 years after the
988	effective date of the policy.
989	(b)  Individual risk rates and modifications to existing
990	approved forms are not subject to this part or part II, except
991	for paragraph (a) and ss. 627.402, 627.403, 627.4035, 627.404,
992	627.405, 627.406, 627.407, 627.4085, 627.409, 627.4132,
993	627.4133, 627.415, 627.416, 627.417, 627.419, 627.425, 627.426,
994	627.4265, 627.427, and 627.428, but are subject to all other
995	applicable provisions of this code and rules adopted thereunder.
996	(c)  This subsection does not apply to private passenger
997	motor vehicle insurance.
998	(d)1.  The following categories or kinds of insurance and
999	types of commercial lines risks are not subject to paragraph
1000	(2)(a) or paragraph (2)(f):
1001	a.  Excess or umbrella.
1002	b.  Surety and fidelity.
1003	c.  Boiler and machinery and leakage and fire extinguishing
1004	equipment.
1005	d.  Errors and omissions.
1006	e.  Directors and officers, employment practices, and
1007	management liability.
1008	f.  Intellectual property and patent infringement
1009	liability.
1010	g.  Advertising injury and Internet liability insurance.
1011	h.  Property risks rated under a highly protected risks
1012	rating plan.
1013	i.  Any other commercial lines categories or kinds of
1014	insurance or types of commercial lines risks that the office
1015	determines should not be subject to paragraph (2)(a) or
1016	paragraph (2)(f) because of the existence of a competitive
1017	market for such insurance, similarity of such insurance to other
1018	categories or kinds of insurance not subject to paragraph (2)(a)
1019	or paragraph (2)(f), or to improve the general operational
1020	efficiency of the office.
1021	2.  Insurers or rating organizations shall establish and
1022	use rates, rating schedules, or rating manuals to allow the
1023	insurer a reasonable rate of return on insurance and risks
1024	described in subparagraph 1. which are written in this state.
1025	3.  An insurer must notify the office of any changes to
1026	rates for insurance and risks described in subparagraph 1.
1027	within no later than 30 days after the effective date of the
1028	change. The notice must include the name of the insurer, the
1029	type or kind of insurance subject to rate change, total premium
1030	written during the immediately preceding year by the insurer for
1031	the type or kind of insurance subject to the rate change, and
1032	the average statewide percentage change in rates. Underwriting
1033	files, premiums, losses, and expense statistics with regard to
1034	such insurance and risks described in subparagraph 1. written by
1035	an insurer must shall be maintained by the insurer and subject
1036	to examination by the office. Upon examination, the office
1037	shall, in accordance with generally accepted and reasonable
1038	actuarial techniques, shall consider the rate factors in
1039	paragraphs (2)(b), (c), and (d) and the standards in paragraph
1040	(2)(e) to determine if the rate is excessive, inadequate, or
1041	unfairly discriminatory.
1042	4.  A rating organization must notify the office of any
1043	changes to loss cost for insurance and risks described in
1044	subparagraph 1. within no later than 30 days after the effective
1045	date of the change. The notice must include the name of the
1046	rating organization, the type or kind of insurance subject to a
1047	loss cost change, loss costs during the immediately preceding
1048	year for the type or kind of insurance subject to the loss cost
1049	change, and the average statewide percentage change in loss
1050	cost. Loss and exposure statistics with regard to risks
1051	applicable to loss costs for a rating organization not subject
1052	to paragraph (2)(a) or paragraph (2)(f) must shall be maintained
1053	by the rating organization and are subject to examination by the
1054	office. Upon examination, the office shall, in accordance with
1055	generally accepted and reasonable actuarial techniques, shall
1056	consider the rate factors in paragraphs (2)(b)-(d) and the
1057	standards in paragraph (2)(e) to determine if the rate is
1058	excessive, inadequate, or unfairly discriminatory.
1059	5.  In reviewing a rate, the office may require the insurer
1060	to provide, at the insurer's expense, all information necessary
1061	to evaluate the condition of the company and the reasonableness
1062	of the rate according to the applicable criteria described in
1063	this section.
1064	(4)  The establishment of any rate, rating classification,
1065	rating plan or schedule, or variation thereof in violation of
1066	part IX of chapter 626 is also in violation of this section. In
1067	order to enhance the ability of consumers to compare premiums
1068	and to increase the accuracy and usefulness of rate-comparison
1069	information provided by the office to the public, the office
1070	shall develop a proposed standard rating territory plan to be
1071	used by all authorized property and casualty insurers for
1072	residential property insurance. In adopting the proposed plan,
1073	the office may consider geographical characteristics relevant to
1074	risk, county lines, major roadways, existing rating territories
1075	used by a significant segment of the market, and other relevant
1076	factors. Such plan shall be submitted to the President of the
1077	Senate and the Speaker of the House of Representatives by
1078	January 15, 2006. The plan may not be implemented unless
1079	authorized by further act of the Legislature.
1080	(5)  With respect to a rate filing involving coverage of
1081	the type for which the insurer is required to pay a
1082	reimbursement premium to the Florida Hurricane Catastrophe Fund,
1083	the insurer may fully recoup in its property insurance premiums
1084	any reimbursement premiums paid to the Florida Hurricane
1085	Catastrophe fund, together with reasonable costs of other
1086	reinsurance; however, but except as otherwise provided in this
1087	section, the insurer may not recoup reinsurance costs that
1088	duplicate coverage provided by the Florida Hurricane Catastrophe
1089	fund. An insurer may not recoup more than 1 year of
1090	reimbursement premium at a time. Any under-recoupment from the
1091	prior year may be added to the following year's reimbursement
1092	premium, and any over-recoupment must shall be subtracted from
1093	the following year's reimbursement premium.
1094	(6)(a)  If an insurer requests an administrative hearing
1095	pursuant to s. 120.57 related to a rate filing under this
1096	section, the director of the Division of Administrative Hearings
1097	shall expedite the hearing and assign an administrative law
1098	judge who shall commence the hearing within 30 days after the
1099	receipt of the formal request and shall enter a recommended
1100	order within 30 days after the hearing or within 30 days after
1101	receipt of the hearing transcript by the administrative law
1102	judge, whichever is later. Each party shall have be allowed 10
1103	days in which to submit written exceptions to the recommended
1104	order. The office shall enter a final order within 30 days after
1105	the entry of the recommended order. The provisions of this
1106	paragraph may be waived upon stipulation of all parties.
1107	(b)  Upon entry of a final order, the insurer may request a
1108	expedited appellate review pursuant to the Florida Rules of
1109	Appellate Procedure. It is the intent of the Legislature that
1110	the First District Court of Appeal grant an insurer's request
1111	for an expedited appellate review.
1112	(7)(a)  The provisions of this subsection apply only with
1113	respect to rates for medical malpractice insurance and shall
1114	control to the extent of any conflict with other provisions of
1115	this section.
1116	(a)(b)  Any portion of a judgment entered or settlement
1117	paid as a result of a statutory or common-law bad faith action
1118	and any portion of a judgment entered which awards punitive
1119	damages against an insurer may not be included in the insurer's
1120	rate base, and shall not be used to justify a rate or rate
1121	change. Any common-law bad faith action identified as such, any
1122	portion of a settlement entered as a result of a statutory or
1123	common-law action, or any portion of a settlement wherein an
1124	insurer agrees to pay specific punitive damages may not be used
1125	to justify a rate or rate change. The portion of the taxable
1126	costs and attorney's fees which is identified as being related
1127	to the bad faith and punitive damages in these judgments and
1128	settlements may not be included in the insurer's rate base and
1129	used may not be utilized to justify a rate or rate change.
1130	(b)(c)  Upon reviewing a rate filing and determining
1131	whether the rate is excessive, inadequate, or unfairly
1132	discriminatory, the office shall consider, in accordance with
1133	generally accepted and reasonable actuarial techniques, past and
1134	present prospective loss experience, either using loss
1135	experience solely for this state or giving greater credibility
1136	to this state's loss data after applying actuarially sound
1137	methods of assigning credibility to such data.
1138	(c)(d)  Rates shall be deemed excessive if, among other
1139	standards established by this section, the rate structure
1140	provides for replenishment of reserves or surpluses from
1141	premiums when the replenishment is attributable to investment
1142	losses.
1143	(d)(e)  The insurer must apply a discount or surcharge
1144	based on the health care provider's loss experience or shall
1145	establish an alternative method giving due consideration to the
1146	provider's loss experience. The insurer must include in the
1147	filing a copy of the surcharge or discount schedule or a
1148	description of the alternative method used, and must provide a
1149	copy of such schedule or description, as approved by the office,
1150	to policyholders at the time of renewal and to prospective
1151	policyholders at the time of application for coverage.
1152	(e)(f)  Each medical malpractice insurer must make a rate
1153	filing under this section, sworn to by at least two executive
1154	officers of the insurer, at least once each calendar year.
1155	(8)(a)1.  No later than 60 days after the effective date of
1156	medical malpractice legislation enacted during the 2003 Special
1157	Session D of the Florida Legislature, the office shall calculate
1158	a presumed factor that reflects the impact that the changes
1159	contained in such legislation will have on rates for medical
1160	malpractice insurance and shall issue a notice informing all
1161	insurers writing medical malpractice coverage of such presumed
1162	factor. In determining the presumed factor, the office shall use
1163	generally accepted actuarial techniques and standards provided
1164	in this section in determining the expected impact on losses,
1165	expenses, and investment income of the insurer. To the extent
1166	that the operation of a provision of medical malpractice
1167	legislation enacted during the 2003 Special Session D of the
1168	Florida Legislature is stayed pending a constitutional
1169	challenge, the impact of that provision shall not be included in
1170	the calculation of a presumed factor under this subparagraph.
1171	2.  No later than 60 days after the office issues its
1172	notice of the presumed rate change factor under subparagraph 1.,
1173	each insurer writing medical malpractice coverage in this state
1174	shall submit to the office a rate filing for medical malpractice
1175	insurance, which will take effect no later than January 1, 2004,
1176	and apply retroactively to policies issued or renewed on or
1177	after the effective date of medical malpractice legislation
1178	enacted during the 2003 Special Session D of the Florida
1179	Legislature. Except as authorized under paragraph (b), the
1180	filing shall reflect an overall rate reduction at least as great
1181	as the presumed factor determined under subparagraph 1. With
1182	respect to policies issued on or after the effective date of
1183	such legislation and prior to the effective date of the rate
1184	filing required by this subsection, the office shall order the
1185	insurer to make a refund of the amount that was charged in
1186	excess of the rate that is approved.
1187	(b)  Any insurer or rating organization that contends that
1188	the rate provided for in paragraph (a) is excessive, inadequate,
1189	or unfairly discriminatory shall separately state in its filing
1190	the rate it contends is appropriate and shall state with
1191	specificity the factors or data that it contends should be
1192	considered in order to produce such appropriate rate. The
1193	insurer or rating organization shall be permitted to use all of
1194	the generally accepted actuarial techniques provided in this
1195	section in making any filing pursuant to this subsection. The
1196	office shall review each such exception and approve or
1197	disapprove it prior to use. It shall be the insurer's burden to
1198	actuarially justify any deviations from the rates required to be
1199	filed under paragraph (a). The insurer making a filing under
1200	this paragraph shall include in the filing the expected impact
1201	of medical malpractice legislation enacted during the 2003
1202	Special Session D of the Florida Legislature on losses,
1203	expenses, and rates.
1204	(c)  If any provision of medical malpractice legislation
1205	enacted during the 2003 Special Session D of the Florida
1206	Legislature is held invalid by a court of competent
1207	jurisdiction, the office shall permit an adjustment of all
1208	medical malpractice rates filed under this section to reflect
1209	the impact of such holding on such rates so as to ensure that
1210	the rates are not excessive, inadequate, or unfairly
1211	discriminatory.
1212	(d)  Rates approved on or before July 1, 2003, for medical
1213	malpractice insurance shall remain in effect until the effective
1214	date of a new rate filing approved under this subsection.
1215	(e)  The calculation and notice by the office of the
1216	presumed factor pursuant to paragraph (a) is not an order or
1217	rule that is subject to chapter 120. If the office enters into a
1218	contract with an independent consultant to assist the office in
1219	calculating the presumed factor, such contract shall not be
1220	subject to the competitive solicitation requirements of s.
1221	287.057.
1222	(8)(9)(a)  The chief executive officer or chief financial
1223	officer of a property insurer and the chief actuary of a
1224	property insurer must certify under oath and subject to the
1225	penalty of perjury, on a form approved by the commission, the
1226	following information, which must accompany a rate filing:
1227	1.  The signing officer and actuary have reviewed the rate
1228	filing;
1229	2.  Based on the signing officer's and actuary's knowledge,
1230	the rate filing does not contain any untrue statement of a
1231	material fact or omit to state a material fact necessary in
1232	order to make the statements made, in light of the circumstances
1233	under which such statements were made, not misleading;
1234	3.  Based on the signing officer's and actuary's knowledge,
1235	the information and other factors described in paragraph (2)(b),
1236	including, but not limited to, investment income, fairly present
1237	in all material respects the basis of the rate filing for the
1238	periods presented in the filing; and
1239	4.  Based on the signing officer's and actuary's knowledge,
1240	the rate filing reflects all premium savings that are reasonably
1241	expected to result from legislative enactments and are in
1242	accordance with generally accepted and reasonable actuarial
1243	techniques.
1244	(b)  A signing officer or actuary who knowingly makes
1245	making a false certification under this subsection commits a
1246	violation of s. 626.9541(1)(e) and is subject to the penalties
1247	under s. 626.9521.
1248	(c)  Failure to provide such certification by the officer
1249	and actuary shall result in the rate filing being disapproved
1250	without prejudice to be refiled.
1251	(d)  The certification made pursuant to paragraph (a) is
1252	not rendered false if, after making the subject rate filing, the
1253	insurer provides the office with additional or supplementary
1254	information pursuant to a formal or informal request from the
1255	office. However, the actuary primarily responsible for preparing
1256	and submitting the additional or supplementary information shall
1257	certify the information consistent with the certification
1258	required in paragraph (a) and the penalties in paragraph (b),
1259	except that the chief executive officer or chief financial
1260	officer or chief actuary is not required to certify to the
1261	additional or supplementary information.
1262	(e)(d)  The commission may adopt rules and forms pursuant
1263	to ss. 120.536(1) and 120.54 to administer this subsection.
1264	(9)(10)  The burden is on the office to establish that
1265	rates are excessive for personal lines residential coverage with
1266	a dwelling replacement cost of $1 million or more or for a
1267	single condominium unit with a combined dwelling and contents
1268	replacement cost of $1 million or more. Upon request of the
1269	office, the insurer shall provide to the office such loss and
1270	expense information as the office reasonably needs to meet this
1271	burden.
1272	(10)(11)  Any interest paid pursuant to s. 627.70131(5) may
1273	not be included in the insurer's rate base and may not be used
1274	to justify a rate or rate change.
1275	Section 12.  Paragraph (b) of subsection (3) of section
1276	627.06281, Florida Statutes, is amended to read:
1277	627.06281  Public hurricane loss projection model;
1278	reporting of data by insurers.-
1279	(3)
1280	(b)  The fees charged for private sector access and use of
1281	the model shall be the reasonable costs associated with the
1282	operation and maintenance of the model. Such fees do not apply
1283	to access and use of the model by the office. By January 1,
1284	2009, the office shall establish by rule a fee schedule for
1285	access to and the use of the model. The fee schedule must be
1286	reasonably calculated to cover only the actual costs of
1287	providing access to and the use of the model.
1288	Section 13.  Subsections (1) and (5) and paragraph (b) of
1289	subsection (8) of section 627.0629, Florida Statutes, are
1290	amended to read:
1291	627.0629  Residential property insurance; rate filings.-
1292	(1)(a)  It is the intent of the Legislature that insurers
1293	must provide savings to consumers who install or implement
1294	windstorm damage mitigation techniques, alterations, or
1295	solutions to their properties to prevent windstorm losses. A
1296	rate filing for residential property insurance must include
1297	actuarially reasonable discounts, credits, or other rate
1298	differentials, or appropriate reductions in deductibles, for
1299	properties on which fixtures or construction techniques
1300	demonstrated to reduce the amount of loss in a windstorm have
1301	been installed or implemented. The fixtures or construction
1302	techniques must shall include, but not be limited to, fixtures
1303	or construction techniques that which enhance roof strength,
1304	roof covering performance, roof-to-wall strength, wall-to-floor-
1305	to-foundation strength, opening protection, and window, door,
1306	and skylight strength. Credits, discounts, or other rate
1307	differentials, or appropriate reductions in deductibles, for
1308	fixtures and construction techniques that which meet the minimum
1309	requirements of the Florida Building Code must be included in
1310	the rate filing. All insurance companies must make a rate filing
1311	which includes the credits, discounts, or other rate
1312	differentials or reductions in deductibles by February 28, 2003.
1313	By July 1, 2007, the office shall reevaluate the discounts,
1314	credits, other rate differentials, and appropriate reductions in
1315	deductibles for fixtures and construction techniques that meet
1316	the minimum requirements of the Florida Building Code, based
1317	upon actual experience or any other loss relativity studies
1318	available to the office. The office shall determine the
1319	discounts, credits, other rate differentials, and appropriate
1320	reductions in deductibles that reflect the full actuarial value
1321	of such revaluation, which may be used by insurers in rate
1322	filings.
1323	(b)  By February 1, 2011, the Office of Insurance
1324	Regulation, in consultation with the Department of Financial
1325	Services and the Department of Community Affairs, shall develop
1326	and make publicly available a proposed method for insurers to
1327	establish discounts, credits, or other rate differentials for
1328	hurricane mitigation measures which directly correlate to the
1329	numerical rating assigned to a structure pursuant to the uniform
1330	home grading scale adopted by the Financial Services Commission
1331	pursuant to s. 215.55865, including any proposed changes to the
1332	uniform home grading scale. By October 1, 2011, the commission
1333	shall adopt rules requiring insurers to make rate filings for
1334	residential property insurance which revise insurers' discounts,
1335	credits, or other rate differentials for hurricane mitigation
1336	measures so that such rate differentials correlate directly to
1337	the uniform home grading scale. The rules may include such
1338	changes to the uniform home grading scale as the commission
1339	determines are necessary, and may specify the minimum required
1340	discounts, credits, or other rate differentials. Such rate
1341	differentials must be consistent with generally accepted
1342	actuarial principles and wind-loss mitigation studies. The rules
1343	shall allow a period of at least 2 years after the effective
1344	date of the revised mitigation discounts, credits, or other rate
1345	differentials for a property owner to obtain an inspection or
1346	otherwise qualify for the revised credit, during which time the
1347	insurer shall continue to apply the mitigation credit that was
1348	applied immediately prior to the effective date of the revised
1349	credit. Discounts, credits, and other rate differentials
1350	established for rate filings under this paragraph shall
1351	supersede, after adoption, the discounts, credits, and other
1352	rate differentials included in rate filings under paragraph (a).
1353	(5)  In order to provide an appropriate transition period,
1354	an insurer may, in its sole discretion, implement an approved
1355	rate filing for residential property insurance over a period of
1356	years. Such An insurer electing to phase in its rate filing must
1357	provide an informational notice to the office setting out its
1358	schedule for implementation of the phased-in rate filing. The An
1359	insurer may include in its rate the actual cost of private
1360	market reinsurance that corresponds to available coverage of the
1361	Temporary Increase in Coverage Limits, TICL, from the Florida
1362	Hurricane Catastrophe Fund. The insurer may also include the
1363	cost of reinsurance to replace the TICL reduction implemented
1364	pursuant to s. 215.555(17)(d)9. However, this cost for
1365	reinsurance may not include any expense or profit load or result
1366	in a total annual base rate increase in excess of 10 percent.
1367	(8)  EVALUATION OF RESIDENTIAL PROPERTY STRUCTURAL
1368	SOUNDNESS.-
1369	(b)  To the extent that funds are provided for this purpose
1370	in the General Appropriations Act, the Legislature hereby
1371	authorizes the establishment of a program to be administered by
1372	the Citizens Property Insurance Corporation for homeowners
1373	insured in the high-risk account is authorized.
1374	Section 14.  Paragraph (b) of subsection (2) of section
1375	627.4133, Florida Statutes, is amended to read:
1376	627.4133  Notice of cancellation, nonrenewal, or renewal
1377	premium.-
1378	(2)  With respect to any personal lines or commercial
1379	residential property insurance policy, including, but not
1380	limited to, any homeowner's, mobile home owner's, farmowner's,
1381	condominium association, condominium unit owner's, apartment
1382	building, or other policy covering a residential structure or
1383	its contents:
1384	(b)  The insurer shall give the named insured written
1385	notice of nonrenewal, cancellation, or termination at least 100
1386	days before prior to the effective date of the nonrenewal,
1387	cancellation, or termination. However, the insurer shall give at
1388	least 100 days' written notice, or written notice by June 1,
1389	whichever is earlier, for any nonrenewal, cancellation, or
1390	termination that would be effective between June 1 and November
1391	30. The notice must include the reason or reasons for the
1392	nonrenewal, cancellation, or termination, except that:
1393	1.  The insurer shall give the named insured written notice
1394	of nonrenewal, cancellation, or termination at least 120 180
1395	days prior to the effective date of the nonrenewal,
1396	cancellation, or termination for a named insured whose
1397	residential structure has been insured by that insurer or an
1398	affiliated insurer for at least a 5-year period immediately
1399	prior to the date of the written notice.
1400	2.  If When cancellation is for nonpayment of premium, at
1401	least 10 days' written notice of cancellation accompanied by the
1402	reason therefor must shall be given. As used in this
1403	subparagraph, the term "nonpayment of premium" means failure of
1404	the named insured to discharge when due any of her or his
1405	obligations in connection with the payment of premiums on a
1406	policy or any installment of such premium, whether the premium
1407	is payable directly to the insurer or its agent or indirectly
1408	under any premium finance plan or extension of credit, or
1409	failure to maintain membership in an organization if such
1410	membership is a condition precedent to insurance coverage. The
1411	term "Nonpayment of premium" also means the failure of a
1412	financial institution to honor an insurance applicant's check
1413	after delivery to a licensed agent for payment of a premium,
1414	even if the agent has previously delivered or transferred the
1415	premium to the insurer. If a dishonored check represents the
1416	initial premium payment, the contract and all contractual
1417	obligations are shall be void ab initio unless the nonpayment is
1418	cured within the earlier of 5 days after actual notice by
1419	certified mail is received by the applicant or 15 days after
1420	notice is sent to the applicant by certified mail or registered
1421	mail, and if the contract is void, any premium received by the
1422	insurer from a third party must shall be refunded to that party
1423	in full.
1424	3.  If When such cancellation or termination occurs during
1425	the first 90 days during which the insurance is in force and the
1426	insurance is canceled or terminated for reasons other than
1427	nonpayment of premium, at least 20 days' written notice of
1428	cancellation or termination accompanied by the reason therefor
1429	must shall be given unless except where there has been a
1430	material misstatement or misrepresentation or failure to comply
1431	with the underwriting requirements established by the insurer.
1432	4.  The requirement for providing written notice of
1433	nonrenewal by June 1 of any nonrenewal that would be effective
1434	between June 1 and November 30 does not apply to the following
1435	situations, but the insurer remains subject to the requirement
1436	to provide such notice at least 100 days before prior to the
1437	effective date of nonrenewal:
1438	a.  A policy that is nonrenewed due to a revision in the
1439	coverage for sinkhole losses and catastrophic ground cover
1440	collapse pursuant to s. 627.706, as amended by s. 30, chapter
1441	2007-1, Laws of Florida.
1442	b.  A policy that is nonrenewed by Citizens Property
1443	Insurance Corporation, pursuant to s. 627.351(6), for a policy
1444	that has been assumed by an authorized insurer offering
1445	replacement or renewal coverage to the policyholder.
1446
1447	After the policy has been in effect for 90 days, the policy may
1448	shall not be canceled by the insurer unless except when there
1449	has been a material misstatement, a nonpayment of premium, a
1450	failure to comply with underwriting requirements established by
1451	the insurer within 90 days after of the date of effectuation of
1452	coverage, or a substantial change in the risk covered by the
1453	policy or if when the cancellation is for all insureds under
1454	such policies for a given class of insureds. This paragraph does
1455	not apply to individually rated risks having a policy term of
1456	less than 90 days.
1457	5.  Notwithstanding any other provision of law, an insurer
1458	may cancel or nonrenew a property insurance policy after at
1459	least 45 days' notice if the office finds that the early
1460	cancellation of some or all of the insurer's policies is
1461	necessary to protect the best interests of the public or
1462	policyholders and the office approves the insurer's plan for
1463	early cancellation or nonrenewal of some or all of its policies.
1464	The office may base such finding upon the financial condition of
1465	the insurer, lack of adequate reinsurance coverage for hurricane
1466	risk, or other relevant factors. The office may condition its
1467	finding on the consent of the insurer to be placed under
1468	administrative supervision pursuant to s. 624.81 or to the
1469	appointment of a receiver under chapter 631.
1470	Section 15.  Section 627.43141, Florida Statutes, is
1471	created to read:
1472	627.43141  Notice of change in policy terms.-
1473	(1)  As used in this section, the term:
1474	(a)  "Change in policy terms" means the modification,
1475	addition, or deletion of any term, coverage, duty, or condition
1476	from the previous policy. The correction of typographical or
1477	scrivener's errors or the application of mandated legislative
1478	changes is not a change in policy terms.
1479	(b)  "Policy" means a written contract of personal lines
1480	property and casualty insurance or a written agreement for
1481	insurance, or the certificate of such insurance, by whatever
1482	name called, and includes all clauses, riders, endorsements, and
1483	papers that are a part of such policy. The term does not include
1484	a binder as defined in s. 627.420 unless the duration of the
1485	binder period exceeds 60 days.
1486	(c)  "Renewal" means the issuance and delivery by an
1487	insurer of a policy superseding at the end of the policy period
1488	a policy previously issued and delivered by the same insurer or
1489	the issuance and delivery of a certificate or notice extending
1490	the term of a policy beyond its policy period or term. Any
1491	policy that has a policy period or term of less than 6 months or
1492	that does not have a fixed expiration date shall, for purposes
1493	of this section, be considered as written for successive policy
1494	periods or terms of 6 months.
1495	(2)  A renewal policy may contain a change in policy terms.
1496	If a renewal policy does contains such change, the insurer must
1497	give the named insured written notice of the change, which must
1498	be enclosed along with the written notice of renewal premium
1499	required by ss. 627.4133 and 627.728. Such notice shall be
1500	entitled "Notice of Change in Policy Terms."
1501	(3)  Although not required, proof of mailing or registered
1502	mailing through the United States Postal Service of the Notice
1503	of Change in Policy Terms to the named insured at the address
1504	shown in the policy is sufficient proof of notice.
1505	(4)  Receipt of the premium payment for the renewal policy
1506	by the insurer is deemed to be acceptance of the new policy
1507	terms by the named insured.
1508	(5)  If an insurer fails to provide the notice required in
1509	subsection (2), the original policy terms remain in effect until
1510	the next renewal and the proper service of the notice, or until
1511	the effective date of replacement coverage obtained by the named
1512	insured, whichever occurs first.
1513	(6)  The intent of this section is to:
1514	(a)  Allow an insurer to make a change in policy terms
1515	without nonrenewing those policyholders that the insurer wishes
1516	to continue insuring.
1517	(b)  Alleviate concern and confusion to the policyholder
1518	caused by the required policy nonrenewal for the limited issue
1519	if an insurer intends to renew the insurance policy, but the new
1520	policy contains a change in policy terms.
1521	(c)  Encourage policyholders to discuss their coverages
1522	with their insurance agents.
1523	Section 16.  Section 627.7011, Florida Statutes, is amended
1524	to read:
1525	627.7011  Homeowners' policies; offer of replacement cost
1526	coverage and law and ordinance coverage.-
1527	(1)  Before Prior to issuing or renewing a homeowner's
1528	insurance policy on or after October 1, 2005, or prior to the
1529	first renewal of a homeowner's insurance policy on or after
1530	October 1, 2005, the insurer must offer each of the following:
1531	(a)  A policy or endorsement providing that any loss that
1532	which is repaired or replaced will be adjusted on the basis of
1533	replacement costs to the dwelling not exceeding policy limits as
1534	to the dwelling, rather than actual cash value, but not
1535	including costs necessary to meet applicable laws and ordinances
1536	regulating the construction, use, or repair of any property or
1537	requiring the tearing down of any property, including the costs
1538	of removing debris.
1539	(b)  A policy or endorsement providing that, subject to
1540	other policy provisions, any loss that which is repaired or
1541	replaced at any location will be adjusted on the basis of
1542	replacement costs to the dwelling not exceeding policy limits as
1543	to the dwelling, rather than actual cash value, and also
1544	including costs necessary to meet applicable laws and ordinances
1545	regulating the construction, use, or repair of any property or
1546	requiring the tearing down of any property, including the costs
1547	of removing debris.; However, such additional costs necessary to
1548	meet applicable laws and ordinances may be limited to either 25
1549	percent or 50 percent of the dwelling limit, as selected by the
1550	policyholder, and such coverage applies shall apply only to
1551	repairs of the damaged portion of the structure unless the total
1552	damage to the structure exceeds 50 percent of the replacement
1553	cost of the structure.
1554
1555	An insurer is not required to make the offers required by this
1556	subsection with respect to the issuance or renewal of a
1557	homeowner's policy that contains the provisions specified in
1558	paragraph (b) for law and ordinance coverage limited to 25
1559	percent of the dwelling limit, except that the insurer must
1560	offer the law and ordinance coverage limited to 50 percent of
1561	the dwelling limit. This subsection does not prohibit the offer
1562	of a guaranteed replacement cost policy.
1563	(2)  Unless the insurer obtains the policyholder's written
1564	refusal of the policies or endorsements specified in subsection
1565	(1), any policy covering the dwelling is deemed to include the
1566	law and ordinance coverage limited to 25 percent of the dwelling
1567	limit. The rejection or selection of alternative coverage shall
1568	be made on a form approved by the office. The form must shall
1569	fully advise the applicant of the nature of the coverage being
1570	rejected. If this form is signed by a named insured, it is will
1571	be conclusively presumed that there was an informed, knowing
1572	rejection of the coverage or election of the alternative
1573	coverage on behalf of all insureds. Unless the policyholder
1574	requests in writing the coverage specified in this section, it
1575	need not be provided in or supplemental to any other policy that
1576	renews, insures, extends, changes, supersedes, or replaces an
1577	existing policy if when the policyholder has rejected the
1578	coverage specified in this section or has selected alternative
1579	coverage. The insurer must provide the such policyholder with
1580	notice of the availability of such coverage in a form approved
1581	by the office at least once every 3 years. The failure to
1582	provide such notice constitutes a violation of this code, but
1583	does not affect the coverage provided under the policy.
1584	(3)(a)  In the event of a loss for which a dwelling is
1585	insured on the basis of replacement costs, the insurer initially
1586	must pay at least the actual cash value of the insured loss,
1587	less any applicable deductible. An insured shall subsequently
1588	enter into a contract for the performance of building and
1589	structural repairs. The insurer shall pay any remaining amounts
1590	incurred to perform such repairs as the work is performed. With
1591	the exception of incidental expenses to mitigate further damage,
1592	the insurer or any contractor or subcontractor may not require
1593	the policyholder to advance payment for such repairs or
1594	expenses. The insurer may waive the requirement for a contract
1595	as provided in this paragraph. An insured shall have a period of
1596	1 year after the date the insurer pays actual cash value to make
1597	a claim for replacement cost. If a total loss of a dwelling
1598	occurs, the insurer shall pay the replacement cost coverage
1599	without reservation or holdback of any depreciation in value,
1600	pursuant to s. 627.702.
1601	(b)  In the event of a loss for which a dwelling or
1602	personal property is insured on the basis of replacement costs,
1603	the insurer shall pay the replacement cost without reservation
1604	or holdback of any depreciation in value, whether or not the
1605	insured replaces or repairs the dwelling or property.
1606	(4)  A Any homeowner's insurance policy issued or renewed
1607	on or after October 1, 2005, must include in bold type no
1608	smaller than 18 points the following statement:
1609
1610	"LAW AND ORDINANCE COVERAGE IS AN IMPORTANT COVERAGE
1611	THAT YOU MAY WISH TO PURCHASE. YOU MAY ALSO NEED TO
1612	CONSIDER THE PURCHASE OF FLOOD INSURANCE FROM THE
1613	NATIONAL FLOOD INSURANCE PROGRAM. WITHOUT THIS
1614	COVERAGE, YOU MAY HAVE UNCOVERED LOSSES. PLEASE
1615	DISCUSS THESE COVERAGES WITH YOUR INSURANCE AGENT."
1616
1617	The intent of this subsection is to encourage policyholders to
1618	purchase sufficient coverage to protect them in case events
1619	excluded from the standard homeowners policy, such as law and
1620	ordinance enforcement and flood, combine with covered events to
1621	produce damage or loss to the insured property. The intent is
1622	also to encourage policyholders to discuss these issues with
1623	their insurance agent.
1624	(5)  Nothing in This section does not: shall be construed
1625	to
1626	(a)  Apply to policies not considered to be "homeowners'
1627	policies," as that term is commonly understood in the insurance
1628	industry. This section specifically does not
1629	(b)  Apply to mobile home policies. Nothing in this section
1630	(c)  Limit shall be construed as limiting the ability of an
1631	any insurer to reject or nonrenew any insured or applicant on
1632	the grounds that the structure does not meet underwriting
1633	criteria applicable to replacement cost or law and ordinance
1634	policies or for other lawful reasons.
1635	(d)(6)  This section does not Prohibit an insurer from
1636	limiting its liability under a policy or endorsement providing
1637	that loss will be adjusted on the basis of replacement costs to
1638	the lesser of:
1639	1.(a)  The limit of liability shown on the policy
1640	declarations page;
1641	2.(b)  The reasonable and necessary cost to repair the
1642	damaged, destroyed, or stolen covered property; or
1643	3.(c)  The reasonable and necessary cost to replace the
1644	damaged, destroyed, or stolen covered property.
1645	(e)(7)  This section does not Prohibit an insurer from
1646	exercising its right to repair damaged property in compliance
1647	with its policy and s. 627.702(7).
1648	Section 17.  Paragraph (a) of subsection (5) of section
1649	627.70131, Florida Statutes, is amended to read:
1650	627.70131  Insurer's duty to acknowledge communications
1651	regarding claims; investigation.-
1652	(5)(a)  Within 90 days after an insurer receives notice of
1653	an initial, reopened, or supplemental a property insurance claim
1654	from a policyholder, the insurer shall pay or deny such claim or
1655	a portion of the claim unless the failure to pay such claim or a
1656	portion of the claim is caused by factors beyond the control of
1657	the insurer which reasonably prevent such payment. Any payment
1658	of an initial or supplemental a claim or portion of such a claim
1659	made paid 90 days after the insurer receives notice of the
1660	claim, or made paid more than 15 days after there are no longer
1661	factors beyond the control of the insurer which reasonably
1662	prevented such payment, whichever is later, bears shall bear
1663	interest at the rate set forth in s. 55.03. Interest begins to
1664	accrue from the date the insurer receives notice of the claim.
1665	The provisions of this subsection may not be waived, voided, or
1666	nullified by the terms of the insurance policy. If there is a
1667	right to prejudgment interest, the insured shall select whether
1668	to receive prejudgment interest or interest under this
1669	subsection. Interest is payable when the claim or portion of the
1670	claim is paid. Failure to comply with this subsection
1671	constitutes a violation of this code. However, failure to comply
1672	with this subsection does shall not form the sole basis for a
1673	private cause of action.
1674	Section 18.  The Legislature finds and declares:
1675	(1)  There is a compelling state interest in maintaining a
1676	viable and orderly private-sector market for property insurance
1677	in this state. The lack of a viable and orderly property market
1678	reduces the availability of property insurance coverage to state
1679	residents, increases the cost of property insurance, and
1680	increases the state's reliance on a residual property insurance
1681	market and its potential for imposing assessments on
1682	policyholders throughout the state.
1683	(2)  In 2005, the Legislature revised ss. 627.706-627.7074,
1684	Florida Statutes, to adopt certain geological or technical
1685	terms; to increase reliance on objective, scientific testing
1686	requirements; and generally to reduce the number of sinkhole
1687	claims and related disputes arising under prior law. The
1688	Legislature determined that since the enactment of these
1689	statutory revisions, both private-sector insurers and Citizens
1690	Property Insurance Corporation have, nevertheless, continued to
1691	experience high claims frequency and severity for sinkhole
1692	insurance claims. In addition, many properties remain unrepaired
1693	even after loss payments, which reduces the local property tax
1694	base and adversely affects the real estate market. Therefore,
1695	the Legislature finds that losses associated with sinkhole
1696	claims adversely affect the public health, safety, and welfare
1697	of this state and its citizens.
1698	(3)  Pursuant to sections 19 through 23 of this act,
1699	technical or scientific definitions adopted in the 2005
1700	legislation are clarified to implement and advance the
1701	Legislature's intended reduction of sinkhole claims and
1702	disputes. Certain other revisions to ss. 627.706-627.7074,
1703	Florida Statutes, are enacted to advance legislative intent to
1704	rely on scientific or technical determinations relating to
1705	sinkholes and sinkhole claims, reduce the number and cost of
1706	disputes relating to sinkhole claims, and ensure that repairs
1707	are made commensurate with the scientific and technical
1708	determinations and insurance claims payments.
1709	Section 19.  Section 627.706, Florida Statutes, is amended
1710	to read:
1711	627.706  Sinkhole insurance; catastrophic ground cover
1712	collapse; definitions.-
1713	(1)(a)  Every insurer authorized to transact property
1714	insurance in this state must shall provide coverage for a
1715	catastrophic ground cover collapse.
1716	(b)  The insurer and shall make available, for an
1717	appropriate additional premium, coverage for sinkhole losses on
1718	any structure, including the contents of personal property
1719	contained therein, to the extent provided in the form to which
1720	the coverage attaches. The insurer may require an inspection of
1721	the property before issuance of sinkhole loss coverage. A policy
1722	for residential property insurance may include a deductible
1723	amount applicable to sinkhole losses equal to 1 percent, 2
1724	percent, 5 percent, or 10 percent of the policy dwelling limits,
1725	with appropriate premium discounts offered with each deductible
1726	amount.
1727	(c)  The insurer may restrict catastrophic ground cover
1728	collapse and sinkhole loss coverage to the principal building,
1729	as defined in the applicable policy.
1730	(2)  As used in ss. 627.706-627.7074, and as used in
1731	connection with any policy providing coverage for a catastrophic
1732	ground cover collapse or for sinkhole losses, the term:
1733	(a)  "Catastrophic ground cover collapse" means geological
1734	activity that results in all the following:
1735	1.  The abrupt collapse of the ground cover;
1736	2.  A depression in the ground cover clearly visible to the
1737	naked eye;
1738	3.  Structural damage to the covered building, including
1739	the foundation; and
1740	4.  The insured structure being condemned and ordered to be
1741	vacated by the governmental agency authorized by law to issue
1742	such an order for that structure.
1743
1744	Contents coverage applies if there is a loss resulting from a
1745	catastrophic ground cover collapse. Structural Damage consisting
1746	merely of the settling or cracking of a foundation, structure,
1747	or building does not constitute a loss resulting from a
1748	catastrophic ground cover collapse.
1749	(b)  "Neutral evaluation" means the alternative dispute
1750	resolution provided in s. 627.7074.
1751	(c)  "Neutral evaluator" means a professional engineer or a
1752	professional geologist who has completed a course of study in
1753	alternative dispute resolution designed or approved by the
1754	department for use in the neutral evaluation process and who is
1755	determined to be fair and impartial.
1756	(d)(e)  "Professional engineer" means a person, as defined
1757	in s. 471.005, who has a bachelor's degree or higher in
1758	engineering and has successfully completed at least five courses
1759	in any combination of the following: geotechnical engineering,
1760	structural engineering, soil mechanics, foundations, or geology
1761	with a specialty in the geotechnical engineering field. A
1762	professional engineer must also have geotechnical experience and
1763	expertise in the identification of sinkhole activity as well as
1764	other potential causes of structural damage to the structure.
1765	(e)(f)  "Professional geologist" means a person, as defined
1766	in by s. 492.102, who has a bachelor's degree or higher in
1767	geology or related earth science and with expertise in the
1768	geology of Florida. A professional geologist must have
1769	geological experience and expertise in the identification of
1770	sinkhole activity as well as other potential geologic causes of
1771	structural damage to the structure.
1772	(f)(b)  "Sinkhole" means a landform created by subsidence
1773	of soil, sediment, or rock as underlying strata are dissolved by
1774	groundwater. A sinkhole forms may form by collapse into
1775	subterranean voids created by dissolution of limestone or
1776	dolostone or by subsidence as these strata are dissolved.
1777	(g)(c)  "Sinkhole loss" means structural damage to the
1778	covered building, including the foundation, caused by sinkhole
1779	activity. Contents coverage and additional living expenses shall
1780	apply only if there is structural damage to the covered building
1781	caused by sinkhole activity.
1782	(h)(d)  "Sinkhole activity" means settlement or systematic
1783	weakening of the earth supporting such property only if the when
1784	such settlement or systematic weakening results from
1785	contemporaneous movement or raveling of soils, sediments, or
1786	rock materials into subterranean voids created by the effect of
1787	water on a limestone or similar rock formation.
1788	(i)  "Structural damage" means a covered building has
1789	experienced:
1790	1.  Foundation displacement in excess of acceptable
1791	variances or deflections as defined in ACI 117-90 or the Florida
1792	Building Code and damage in the primary structural members or
1793	primary structural systems that prevents them from supporting
1794	the loads and forces they were designed to support as defined in
1795	the Florida Building Code;
1796	2.  Damage that results in stresses in a primary structural
1797	member greater than one and one-third the nominal strength
1798	allowed under the Florida Building Code for new buildings of
1799	similar structure, purpose, or location;
1800	3.  Listing, leaning, or buckling of the exterior load
1801	bearing walls or other vertical primary structural members to
1802	such an extent that a plumb line passing through the center of
1803	gravity does not fall inside the middle one-third of the base as
1804	defined within the Florida Building Code;
1805	4.  Damage that results in the building, or any portion
1806	thereof, being likely to imminently collapse partially or
1807	completely because of the movement or instability of the ground
1808	within the influence zone of the supporting ground within the
1809	sheer plane necessary for the purpose of supporting such
1810	building as defined within the Florida Building Code; or
1811	5.  Damage that qualifies as "substantial structural
1812	damage" as defined in the Florida Building Code.
1813	(3)  On or before June 1, 2007, Every insurer authorized to
1814	transact property insurance in this state shall make a proper
1815	filing with the office for the purpose of extending the
1816	appropriate forms of property insurance to include coverage for
1817	catastrophic ground cover collapse or for sinkhole losses.
1818	coverage for catastrophic ground cover collapse may not go into
1819	effect until the effective date provided for in the filing
1820	approved by the office.
1821	(3)(4)  Insurers offering policies that exclude coverage
1822	for sinkhole losses must shall inform policyholders in bold type
1823	of not less than 14 points as follows: "YOUR POLICY PROVIDES
1824	COVERAGE FOR A CATASTROPHIC GROUND COVER COLLAPSE THAT RESULTS
1825	IN THE PROPERTY BEING CONDEMNED AND UNINHABITABLE. OTHERWISE,
1826	YOUR POLICY DOES NOT PROVIDE COVERAGE FOR SINKHOLE LOSSES. YOU
1827	MAY PURCHASE ADDITIONAL COVERAGE FOR SINKHOLE LOSSES FOR AN
1828	ADDITIONAL PREMIUM."
1829	(4)(5)  An insurer offering sinkhole coverage to
1830	policyholders before or after the adoption of s. 30, chapter
1831	2007-1, Laws of Florida, may nonrenew the policies of
1832	policyholders maintaining sinkhole coverage in Pasco County or
1833	Hernando County, at the option of the insurer, and provide an
1834	offer of coverage that to such policyholders which includes
1835	catastrophic ground cover collapse and excludes sinkhole
1836	coverage. Insurers acting in accordance with this subsection are
1837	subject to the following requirements:
1838	(a)  Policyholders must be notified that a nonrenewal is
1839	for purposes of removing sinkhole coverage, and that the
1840	policyholder is still being offered a policy that provides
1841	coverage for catastrophic ground cover collapse.
1842	(b)  Policyholders must be provided an actuarially
1843	reasonable premium credit or discount for the removal of
1844	sinkhole coverage and provision of only catastrophic ground
1845	cover collapse.
1846	(c)  Subject to the provisions of this subsection and the
1847	insurer's approved underwriting or insurability guidelines, the
1848	insurer shall provide each policyholder with the opportunity to
1849	purchase an endorsement to his or her policy providing sinkhole
1850	coverage and may require an inspection of the property before
1851	issuance of a sinkhole coverage endorsement.
1852	(d)  Section 624.4305 does not apply to nonrenewal notices
1853	issued pursuant to this subsection.
1854	(5)  Any claim, including, but not limited to, initial,
1855	supplemental, and reopened claims under an insurance policy that
1856	provides sinkhole coverage is barred unless notice of the claim
1857	was given to the insurer in accordance with the terms of the
1858	policy within 4 years after the policyholder knew or reasonably
1859	should have known about the sinkhole loss.
1860	Section 20.  Section 627.7065, Florida Statutes, is
1861	repealed.
1862	Section 21.  Section 627.707, Florida Statutes, is amended
1863	to read:
1864	627.707  Standards for Investigation of sinkhole claims by
1865	insurers; insurer payment; nonrenewals.-Upon receipt of a claim
1866	for a sinkhole loss to a covered building, an insurer must meet
1867	the following standards in investigating a claim:
1868	(1)  The insurer must inspect make an inspection of the
1869	policyholder's insured's premises to determine if there is
1870	structural has been physical damage that to the structure which
1871	may be the result of sinkhole activity.
1872	(2)  If the insurer confirms that structural damage exists
1873	but is unable to identify a valid cause of such damage or
1874	discovers that such damage is consistent with sinkhole loss
1875	Following the insurer's initial inspection, the insurer shall
1876	engage a professional engineer or a professional geologist to
1877	conduct testing as provided in s. 627.7072 to determine the
1878	cause of the loss within a reasonable professional probability
1879	and issue a report as provided in s. 627.7073, only if sinkhole
1880	loss is covered under the policy. Except as provided in
1881	subsections (4) and (6), the fees and costs of the professional
1882	engineer or professional geologist shall be paid by the
1883	insurer.:
1884	(a)  The insurer is unable to identify a valid cause of the
1885	damage or discovers damage to the structure which is consistent
1886	with sinkhole loss; or
1887	(b)  The policyholder demands testing in accordance with
1888	this section or s. 627.7072.
1889	(3)  Following the initial inspection of the policyholder's
1890	insured premises, the insurer shall provide written notice to
1891	the policyholder disclosing the following information:
1892	(a)  What the insurer has determined to be the cause of
1893	damage, if the insurer has made such a determination.
1894	(b)  A statement of the circumstances under which the
1895	insurer is required to engage a professional engineer or a
1896	professional geologist to verify or eliminate sinkhole loss and
1897	to engage a professional engineer to make recommendations
1898	regarding land and building stabilization and foundation repair.
1899	(c)  A statement regarding the right of the policyholder to
1900	request testing by a professional engineer or a professional
1901	geologist, and the circumstances under which the policyholder
1902	may demand certain testing, and the circumstances under which
1903	the policyholder may incur costs associated with testing.
1904	(4)(a)  If the insurer determines that there is no sinkhole
1905	loss, the insurer may deny the claim.
1906	(b)  If coverage for sinkhole loss is available and If the
1907	insurer denies the claim, without performing testing under s.
1908	627.7072, the policyholder may demand testing by the insurer
1909	under s. 627.7072.
1910	1.  The policyholder's demand for testing must be
1911	communicated to the insurer in writing within 60 days after the
1912	policyholder's receipt of the insurer's denial of the claim.
1913	2.  The policyholder shall pay 50 percent of the actual
1914	costs of the analyses and services provided under ss. 627.7072
1915	and 627.7073 or $2,500, whichever is less.
1916	3.  The insurer shall reimburse the policyholder for the
1917	costs if the insurer obtains pursuant to s. 627.7073 written
1918	certification that there is sinkhole loss.
1919	(5)(a)  Subject to paragraph (b), If a sinkhole loss is
1920	verified, the insurer shall pay to stabilize the land and
1921	building and repair the foundation in accordance with the
1922	recommendations of the professional engineer retained pursuant
1923	to subsection (2), as provided under s. 627.7073, and in
1924	consultation with notice to the policyholder, subject to the
1925	coverage and terms of the policy. The insurer shall pay for
1926	other repairs to the structure and contents in accordance with
1927	the terms of the policy.
1928	(a)(b)  The insurer may limit its total claims payment to
1929	the actual cash value of the sinkhole loss, which does not
1930	include including underpinning or grouting or any other repair
1931	technique performed below the existing foundation of the
1932	building, until the policyholder enters into a contract for the
1933	performance of building stabilization or foundation repairs in
1934	accordance with the recommendations set forth in the insurer's
1935	report issued pursuant to s. 627.7073.
1936	(b)  In order to prevent additional damage to the building
1937	or structure, the policyholder must enter into a contract for
1938	the performance of building stabilization or foundation repairs
1939	within 90 days after the insurance company confirms coverage for
1940	the sinkhole loss and notifies the policyholder of such
1941	confirmation. This time period is tolled if either party invokes
1942	the neutral evaluation process and begins again 10 days after
1943	the conclusion of the neutral evaluation process.
1944	(c)  After the policyholder enters into the contract for
1945	the performance of building stabilization or foundation repairs,
1946	the insurer shall pay the amounts necessary to begin and perform
1947	such repairs as the work is performed and the expenses are
1948	incurred. The insurer may not require the policyholder to
1949	advance payment for such repairs. If repair covered by a
1950	personal lines residential property insurance policy has begun
1951	and the professional engineer selected or approved by the
1952	insurer determines that the repair cannot be completed within
1953	the policy limits, the insurer must either complete the
1954	professional engineer's recommended repair or tender the policy
1955	limits to the policyholder without a reduction for the repair
1956	expenses incurred.
1957	(d)  The stabilization and all other repairs to the
1958	structure and contents must be completed within 12 months after
1959	entering into the contract for repairs described in paragraph
1960	(b) unless:
1961	1.  There is a mutual agreement between the insurer and the
1962	policyholder;
1963	2.  The claim is involved with the neutral evaluation
1964	process;
1965	3.  The claim is in litigation; or
1966	4.  The claim is under appraisal or mediation.
1967	(e)(c)  Upon the insurer's obtaining the written approval
1968	of the policyholder and any lienholder, the insurer may make
1969	payment directly to the persons selected by the policyholder to
1970	perform the land and building stabilization and foundation
1971	repairs. The decision by the insurer to make payment to such
1972	persons does not hold the insurer liable for the work performed.
1973	The policyholder may not accept a rebate from any person
1974	performing the repairs specified in this section. If a
1975	policyholder does receive a rebate, coverage is void and the
1976	policyholder must refund the amount of the rebate to the
1977	insurer. Any person making the repairs specified in this section
1978	who offers a rebate, or any policyholder who accepts a rebate
1979	for such repairs, commits insurance fraud, a felony of the third
1980	degree punishable as provided in s. 775.082, s. 775.083, or s.
1981	775.084.
1982	(6)  Except as provided in subsection (7), the fees and
1983	costs of the professional engineer or the professional geologist
1984	shall be paid by the insurer.
1985	(6)(7)  If the insurer obtains, pursuant to s. 627.7073,
1986	written certification that there is no sinkhole loss or that the
1987	cause of the damage was not sinkhole activity, and if the
1988	policyholder has submitted the sinkhole claim without good faith
1989	grounds for submitting such claim, the policyholder shall
1990	reimburse the insurer for 50 percent of the actual costs of the
1991	analyses and services provided under ss. 627.7072 and 627.7073;
1992	however, a policyholder is not required to reimburse an insurer
1993	more than $2,500 with respect to any claim. A policyholder is
1994	required to pay reimbursement under this subsection only if the
1995	policyholder requested the analysis and services provided under
1996	ss. 627.7072 and 627.7073 and the insurer, before prior to
1997	ordering the analysis under s. 627.7072, informs the
1998	policyholder in writing of the policyholder's potential
1999	liability for reimbursement and gives the policyholder the
2000	opportunity to withdraw the claim.
2001	(7)(8)  An No insurer may not shall nonrenew any policy of
2002	property insurance on the basis of filing of claims for sinkhole
2003	partial loss if caused by sinkhole damage or clay shrinkage as
2004	long as the total of such payments does not exceed the current
2005	policy limits of coverage for the policy in effect on the date
2006	of loss, for property damage to the covered building, as set
2007	forth on the declarations page, and provided the insured has
2008	repaired the structure in accordance with the engineering
2009	recommendations made pursuant to subsection (2) upon which any
2010	payment or policy proceeds were based.
2011	(8)(9)  The insurer may engage a professional structural
2012	engineer to make recommendations as to the repair of the
2013	structure.
2014	Section 22.  Section 627.7073, Florida Statutes, is amended
2015	to read:
2016	627.7073  Sinkhole reports.-
2017	(1)  Upon completion of testing as provided in s. 627.7072,
2018	the professional engineer or professional geologist shall issue
2019	a report and certification to the insurer and the policyholder
2020	as provided in this section.
2021	(a)  Sinkhole loss is verified if, based upon tests
2022	performed in accordance with s. 627.7072, a professional
2023	engineer or a professional geologist issues a written report and
2024	certification stating:
2025	1.  That structural damage to the covered building has been
2026	identified within a reasonable professional probability.
2027	2.1.  That the cause of the actual physical and structural
2028	damage is sinkhole activity within a reasonable professional
2029	probability.
2030	3.2.  That the analyses conducted were of sufficient scope
2031	to identify sinkhole activity as the cause of damage within a
2032	reasonable professional probability.
2033	4.3.  A description of the tests performed.
2034	5.4.  A recommendation by the professional engineer of
2035	methods for stabilizing the land and building and for making
2036	repairs to the foundation.
2037	(b)  If there is no structural damage or if sinkhole
2038	activity is eliminated as the cause of such damage to the
2039	covered building structure, the professional engineer or
2040	professional geologist shall issue a written report and
2041	certification to the policyholder and the insurer stating:
2042	1.  That there is no structural damage or the cause of such
2043	the damage is not sinkhole activity within a reasonable
2044	professional probability.
2045	2.  That the analyses and tests conducted were of
2046	sufficient scope to eliminate sinkhole activity as the cause of
2047	the structural damage within a reasonable professional
2048	probability.
2049	3.  A statement of the cause of the structural damage
2050	within a reasonable professional probability.
2051	4.  A description of the tests performed.
2052	(c)  The respective findings, opinions, and recommendations
2053	of the professional engineer or professional geologist as to the
2054	cause of distress to the property and the findings, opinions,
2055	and recommendations of the professional engineer as to land and
2056	building stabilization and foundation repair shall be presumed
2057	correct.
2058	(2)(a)  Any insurer that has paid a claim for a sinkhole
2059	loss shall file a copy of the report and certification, prepared
2060	pursuant to subsection (1), including the legal description of
2061	the real property and the name of the property owner, the
2062	neutral evaluator's report, if any, that indicates that sinkhole
2063	activity caused the damage claimed, a copy of the certification
2064	indicating that stabilization has been completed, if applicable,
2065	and the amount of the payment, with the county clerk of court,
2066	who shall record the report and certification. The insurer shall
2067	bear the cost of filing and recording one or more reports and
2068	certifications the report and certification. There shall be no
2069	cause of action or liability against an insurer for compliance
2070	with this section.
2071	(a)  The recording of the report and certification does
2072	not:
2073	1.  Constitute a lien, encumbrance, or restriction on the
2074	title to the real property or constitute a defect in the title
2075	to the real property;
2076	2.  Create any cause of action or liability against any
2077	grantor of the real property for breach of any warranty of good
2078	title or warranty against encumbrances; or
2079	3.  Create any cause of action or liability against any
2080	title insurer that insures the title to the real property.
2081	(b)  As a precondition to accepting payment for a sinkhole
2082	loss, the policyholder must file a copy of any report prepared
2083	on behalf or at the request of the policyholder regarding the
2084	insured property. The policyholder shall bear the cost of filing
2085	and recording such sinkhole report. The recording of the report
2086	does not:
2087	1.  Constitute a lien, encumbrance, or restriction on the
2088	title to the real property or constitute a defect in the title
2089	to the real property;
2090	2.  Create any cause of action or liability against any
2091	grantor of the real property for breach of any warranty of good
2092	title or warranty against encumbrances; or
2093	3.  Create any cause of action or liability against any
2094	title insurer that insures the title to the real property.
2095	(c)(b)  The seller of real property upon which a sinkhole
2096	claim has been made by the seller and paid by the insurer must
2097	shall disclose to the buyer of such property that a claim has
2098	been paid and whether or not the full amount of the proceeds
2099	were used to repair the sinkhole damage.
2100	Section 23.  Section 627.7074, Florida Statutes, is amended
2101	to read:
2102	627.7074  Alternative procedure for resolution of disputed
2103	sinkhole insurance claims.-
2104	(1)  As used in this section, the term:
2105	(a)  "Neutral evaluation" means the alternative dispute
2106	resolution provided for in this section.
2107	(b)  "Neutral evaluator" means a professional engineer or a
2108	professional geologist who has completed a course of study in
2109	alternative dispute resolution designed or approved by the
2110	department for use in the neutral evaluation process, who is
2111	determined to be fair and impartial.
2112	(1)(2)(a)  The department shall:
2113	(a)  Certify and maintain a list of persons who are neutral
2114	evaluators.
2115	(b)  The department shall Prepare a consumer information
2116	pamphlet for distribution by insurers to policyholders which
2117	clearly describes the neutral evaluation process and includes
2118	information and forms necessary for the policyholder to request
2119	a neutral evaluation.
2120	(2)  Neutral evaluation is available to either party if a
2121	sinkhole report has been issued pursuant to s. 627.7073. At a
2122	minimum, neutral evaluation must determine:
2123	(a)  Causation;
2124	(b)  All methods of stabilization and repair both above and
2125	below ground;
2126	(c)  The costs for stabilization and all repairs; and
2127	(d)  Information necessary to carry out subsection (12).
2128	(3)  Following the receipt of the report provided under s.
2129	627.7073 or the denial of a claim for a sinkhole loss, the
2130	insurer shall notify the policyholder of his or her right to
2131	participate in the neutral evaluation program under this
2132	section. Neutral evaluation supersedes the alternative dispute
2133	resolution process under s. 627.7015, but does not invalidate
2134	the appraisal clause of the insurance policy. The insurer shall
2135	provide to the policyholder the consumer information pamphlet
2136	prepared by the department pursuant to subsection (1)
2137	electronically or by United States mail paragraph (2)(b).
2138	(4)  Neutral evaluation is nonbinding, but mandatory if
2139	requested by either party. A request for neutral evaluation may
2140	be filed with the department by the policyholder or the insurer
2141	on a form approved by the department. The request for neutral
2142	evaluation must state the reason for the request and must
2143	include an explanation of all the issues in dispute at the time
2144	of the request. Filing a request for neutral evaluation tolls
2145	the applicable time requirements for filing suit for a period of
2146	60 days following the conclusion of the neutral evaluation
2147	process or the time prescribed in s. 95.11, whichever is later.
2148	(5)  Neutral evaluation shall be conducted as an informal
2149	process in which formal rules of evidence and procedure need not
2150	be observed. A party to neutral evaluation is not required to
2151	attend neutral evaluation if a representative of the party
2152	attends and has the authority to make a binding decision on
2153	behalf of the party. All parties shall participate in the
2154	evaluation in good faith. The neutral evaluator must be allowed
2155	reasonable access to the interior and exterior of insured
2156	structures to be evaluated or for which a claim has been made.
2157	Any reports initiated by the policyholder, or an agent of the
2158	policyholder, confirming a sinkhole loss or disputing another
2159	sinkhole report regarding insured structures must be provided to
2160	the neutral evaluator before the evaluator's physical inspection
2161	of the insured property.
2162	(6)  The insurer shall pay the costs associated with the
2163	neutral evaluation. However, if a party chooses to hire a court
2164	reporter or stenographer to contemporaneously record and
2165	document the neutral evaluation, that party must bear such
2166	costs.
2167	(7)  Upon receipt of a request for neutral evaluation, the
2168	department shall provide the parties a list of certified neutral
2169	evaluators. The parties shall mutually select a neutral
2170	evaluator from the list and promptly inform the department. If
2171	the parties cannot agree to a neutral evaluator within 10
2172	business days, The department shall allow the parties to submit
2173	requests to disqualify evaluators on the list for cause.
2174	(a)  The department shall disqualify neutral evaluators for
2175	cause based only on any of the following grounds:
2176	1.  A familial relationship exists between the neutral
2177	evaluator and either party or a representative of either party
2178	within the third degree.
2179	2.  The proposed neutral evaluator has, in a professional
2180	capacity, previously represented either party or a
2181	representative of either party, in the same or a substantially
2182	related matter.
2183	3.  The proposed neutral evaluator has, in a professional
2184	capacity, represented another person in the same or a
2185	substantially related matter and that person's interests are
2186	materially adverse to the interests of the parties. The term
2187	"substantially related matter" means participation by the
2188	neutral evaluator on the same claim, property, or adjacent
2189	property.
2190	4.  The proposed neutral evaluator has, within the
2191	preceding 5 years, worked as an employer or employee of any
2192	party to the case.
2193	(b)  The parties shall appoint a neutral evaluator from the
2194	department list and promptly inform the department. If the
2195	parties cannot agree to a neutral evaluator within 14 days, the
2196	department shall appoint a neutral evaluator from the list of
2197	certified neutral evaluators. The department shall allow each
2198	party to disqualify two neutral evaluators without cause. Upon
2199	selection or appointment, the department shall promptly refer
2200	the request to the neutral evaluator.
2201	(c)  Within 7 5 business days after the referral, the
2202	neutral evaluator shall notify the policyholder and the insurer
2203	of the date, time, and place of the neutral evaluation
2204	conference. The conference may be held by telephone, if feasible
2205	and desirable. The neutral evaluator shall hold the neutral
2206	evaluation conference shall be held within 90 45 days after the
2207	receipt of the request by the department. Failure of the neutral
2208	evaluator to hold the conference within 90 days does not
2209	invalidate either party's right to neutral evaluation or to a
2210	neutral evaluation conference held outside this timeframe.
2211	(8)  The department shall adopt rules of procedure for the
2212	neutral evaluation process.
2213	(8)(9)  For policyholders not represented by an attorney, a
2214	consumer affairs specialist of the department or an employee
2215	designated as the primary contact for consumers on issues
2216	relating to sinkholes under s. 20.121 shall be available for
2217	consultation to the extent that he or she may lawfully do so.
2218	(9)(10)  Evidence of an offer to settle a claim during the
2219	neutral evaluation process, as well as any relevant conduct or
2220	statements made in negotiations concerning the offer to settle a
2221	claim, is inadmissible to prove liability or absence of
2222	liability for the claim or its value, except as provided in
2223	subsection (14) (13).
2224	(10)(11)  Regardless of when noticed, any court proceeding
2225	related to the subject matter of the neutral evaluation shall be
2226	stayed pending completion of the neutral evaluation and for 5
2227	days after the filing of the neutral evaluator's report with the
2228	court.
2229	(11)  If, based upon his or her professional training and
2230	credentials, a neutral evaluator is qualified to determine only
2231	disputes relating to causation or method of repair, the
2232	department shall allow the neutral evaluator to enlist the
2233	assistance of another professional from the list of neutral
2234	evaluators not previously stricken, who, based upon his or her
2235	professional training and credentials, is able to provide an
2236	opinion as to other disputed issues. A professional who would be
2237	disqualified for any reason listed in subsection (7) must be
2238	disqualified. The neutral evaluator may also use the services of
2239	professional engineers and professional geologists who are not
2240	certified as neutral evaluators, as well as licensed building
2241	contractors, in order to ensure that all items in dispute are
2242	addressed and the neutral evaluation can be completed. Any
2243	professional engineer, professional geologist, or licensed
2244	building contractor retained may be disqualified for any of the
2245	reasons listed in subsection (7).
2246	(12)  At For matters that are not resolved by the parties
2247	at the conclusion of the neutral evaluation, the neutral
2248	evaluator shall prepare a report describing all matters that are
2249	the subject of the neutral evaluation, including whether,
2250	stating that in his or her opinion the sinkhole loss has been
2251	verified or eliminated within a reasonable degree of
2252	professional probability and, if verified, whether the sinkhole
2253	activity caused structural damage to the covered building, and
2254	if so, the need for and estimated costs of stabilizing the land
2255	and any covered structures or buildings and other appropriate
2256	remediation or necessary building structural repairs due to the
2257	sinkhole loss. The evaluator's report shall be sent to all
2258	parties in attendance at the neutral evaluation and to the
2259	department, within 14 days after completing the neutral
2260	evaluation conference.
2261	(13)  The recommendation of the neutral evaluator is not
2262	binding on any party, and the parties retain access to the
2263	court. The neutral evaluator's written recommendation is
2264	admissible in any subsequent action or proceeding relating to
2265	the claim or to the cause of action giving rise to the claim.
2266	(14)  If the neutral evaluator first verifies the existence
2267	of a sinkhole that caused structural damage and, second,
2268	recommends the need for and estimates costs of stabilizing the
2269	land and any covered structures or buildings and other
2270	appropriate remediation or building structural repairs, which
2271	costs exceed the amount that the insurer has offered to pay the
2272	policyholder, the insurer is liable to the policyholder for up
2273	to $2,500 in attorney's fees for the attorney's participation in
2274	the neutral evaluation process. For purposes of this subsection,
2275	the term "offer to pay" means a written offer signed by the
2276	insurer or its legal representative and delivered to the
2277	policyholder within 10 days after the insurer receives notice
2278	that a request for neutral evaluation has been made under this
2279	section.
2280	(15)  If the insurer timely agrees in writing to comply and
2281	timely complies with the recommendation of the neutral
2282	evaluator, but the policyholder declines to resolve the matter
2283	in accordance with the recommendation of the neutral evaluator
2284	pursuant to this section:
2285	(a)  The insurer is not liable for extracontractual damages
2286	related to a claim for a sinkhole loss but only as related to
2287	the issues determined by the neutral evaluation process. This
2288	section does not affect or impair claims for extracontractual
2289	damages unrelated to the issues determined by the neutral
2290	evaluation process contained in this section; and
2291	(b)  The insurer is not liable for attorney's fees under s.
2292	627.428 or other provisions of the insurance code unless the
2293	policyholder obtains a judgment that is more favorable than the
2294	recommendation of the neutral evaluator.
2295	(16)  Neutral evaluators are deemed to be agents of the
2296	department and have immunity from suit as provided in s. 44.107.
2297	(17)  The department shall adopt rules of procedure for the
2298	neutral evaluation process.
2299	Section 24.  Subsection (8) of section 627.711, Florida
2300	Statutes, is amended to read:
2301	627.711  Notice of premium discounts for hurricane loss
2302	mitigation; uniform mitigation verification inspection form.-
2303	(8)  At its expense, the insurer may require that any
2304	uniform mitigation verification form provided by a policyholder,
2305	policyholder's agent, an authorized mitigation inspector, or
2306	inspection company be independently verified by an inspector, an
2307	inspection company, or an independent third-party quality
2308	assurance provider which does possess a quality assurance
2309	program before prior to accepting the uniform mitigation
2310	verification form as valid.
2311	Section 25.  Subsection (3) of section 631.54, Florida
2312	Statutes, is amended to read:
2313	631.54  Definitions.-As used in this part:
2314	(3)  "Covered claim" means an unpaid claim, including one
2315	of unearned premiums, which arises out of, and is within the
2316	coverage, and not in excess of, the applicable limits of an
2317	insurance policy to which this part applies, issued by an
2318	insurer, if such insurer becomes an insolvent insurer and the
2319	claimant or insured is a resident of this state at the time of
2320	the insured event or the property from which the claim arises is
2321	permanently located in this state. For entities other than
2322	individuals, the residence of a claimant, insured, or
2323	policyholder is the state in which the entity's principal place
2324	of business is located at the time of the insured event. The
2325	term does "Covered claim" shall not include:
2326	(a)  Any amount due any reinsurer, insurer, insurance pool,
2327	or underwriting association, sought directly or indirectly
2328	through a third party, as subrogation, contribution,
2329	indemnification, or otherwise; or
2330	(b)  Any claim that would otherwise be a covered claim
2331	under this part that has been rejected by any other state
2332	guaranty fund on the grounds that an insured's net worth is
2333	greater than that allowed under that state's guaranty law.
2334	Member insurers shall have no right of subrogation,
2335	contribution, indemnification, or otherwise, sought directly or
2336	indirectly through a third party, against the insured of any
2337	insolvent member; or
2338	(c)  Any amount payable for a sinkhole loss other than
2339	testing deemed appropriate by the association or payable for the
2340	actual repair of the loss, except that the association may not
2341	pay for attorney's fees or public adjuster's fees in connection
2342	with a sinkhole loss or pay the policyholder. The association
2343	may pay for actual repairs to the property, but is not liable
2344	for amounts in excess of policy limits.
2345	Section 26.  If any provision of this act, or the
2346	application thereof to any person or circumstance is held
2347	invalid, such invalidity shall not affect other provisions or
2348	applications of this act which can be given effect without the
2349	invalid provision or application. It is the express intent of
2350	the Legislature to enact multiple important, but independent,
2351	reforms to Florida law relating to sinkhole insurance coverage
2352	and related claims. The Legislature further intends that the
2353	multiple reforms in the act could and should be enforced if one
2354	or more provisions are held invalid. To this end, the provisions
2355	of this act are declared to be severable.
2356	Section 27.  Except as otherwise expressly provided in this
2357	act, this act shall take effect upon becoming a law.

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