HB 99

1	A bill to be entitled
2	An act relating to commercial insurance rates; amending s.
3	627.062, F.S.; exempting additional categories or kinds of
4	insurance and types of commercial lines risks from being
5	subject to certain otherwise applicable rate filing
6	requirements; deleting a requirement that an insurer's
7	rate change notice include total premium written for an
8	exempt class of insurance; removing a requirement that
9	specified types of records and information related to a
10	rate change be retained by an insurer; requiring actuarial
11	data regarding a rate change for an exempt class of
12	insurance be retained by an insurer for a specified time;
13	removing a requirement that a rating organization maintain
14	certain statistics related to changes to loss cost for
15	exempt classes of insurance; requiring certain actuarial
16	data related to loss cost be retained by a rating
17	organization for a specified time; deleting authority for
18	the Office of Insurance Regulation to require all
19	necessary information from an insurer in order to evaluate
20	a rate change; amending s. 627.0651, F.S.; expanding an
21	exemption from certain otherwise applicable rate filing
22	requirements to include all commercial motor vehicle
23	insurance; deleting a requirement that a commercial motor
24	vehicle insurer's rate change notice include total premium
25	written; removing a requirement that specified types of
26	records and information related to a commercial motor
27	vehicle insurance rate change be retained by an insurer;
28	requiring actuarial data regarding a commercial motor
29	vehicle insurance rate change be retained by an insurer
30	for a specified time; removing a requirement that a rating
31	organization maintain certain statistics related to
32	changes to loss cost for commercial motor vehicle
33	insurance; requiring actuarial data related to loss cost
34	for commercial motor vehicle insurance be retained by a
35	rating organization for a specified time; deleting
36	authority for the Office of Insurance Regulation to
37	require all necessary information from an commercial motor
38	vehicle insurer in order to evaluate a rate change;
39	providing an effective date.
40
41	Be It Enacted by the Legislature of the State of Florida:
42
43	Section 1.  Paragraph (d) of subsection (3) of section
44	627.062, Florida Statutes, is amended to read:
45	627.062  Rate standards.-
46	(3)
47	(d)1.  The following categories or kinds of insurance and
48	types of commercial lines risks are not subject to paragraph
49	(2)(a) or paragraph (2)(f):
50	a.  Excess or umbrella.
51	b.  Surety and fidelity.
52	c.  Boiler and machinery and leakage and fire extinguishing
53	equipment.
54	d.  Errors and omissions professional liability.
55	e.  Directors and officers, employment practices, fiduciary
56	liability, and other management liability.
57	f.  Intellectual property and patent infringement
58	liability.
59	g.  Advertising injury and Internet liability insurance.
60	h.  Property risks rated under a highly protected risks
61	rating plan.
62	i.  General liability.
63	j.  Nonresidential property.
64	k.  Nonresidential multiperil.
65	l.  Excess property.
66	m.i.  Any other commercial lines categories or kinds of
67	insurance or types of commercial lines risks that the office
68	determines should not be subject to paragraph (2)(a) or
69	paragraph (2)(f) because of the existence of a competitive
70	market for such insurance, similarity of such insurance to other
71	categories or kinds of insurance not subject to paragraph (2)(a)
72	or paragraph (2)(f), or to improve the general operational
73	efficiency of the office.
74	2.  Insurers or rating organizations shall establish and
75	use rates, rating schedules, or rating manuals to allow the
76	insurer a reasonable rate of return on insurance and risks
77	described in subparagraph 1. which are written in this state.
78	3.  An insurer must notify the office of any changes to
79	rates for insurance and risks described in subparagraph 1. no
80	later than 30 days after the effective date of the change. The
81	notice must include the name of the insurer, the type or kind of
82	insurance subject to rate change, total premium written during
83	the immediately preceding year by the insurer for the type or
84	kind of insurance subject to the rate change, and the average
85	statewide percentage change in rates. Actuarial data
86	Underwriting files, premiums, losses, and expense statistics
87	with regard to rates for insurance and risks described in
88	subparagraph 1. written by an insurer shall be maintained by the
89	insurer for 2 years after the effective date of changes to those
90	rates and are subject to examination by the office. Upon
91	examination, the office shall, in accordance with generally
92	accepted and reasonable actuarial techniques, consider the rate
93	factors in paragraphs (2)(b), (c), and (d) and the standards in
94	paragraph (2)(e) to determine if the rate is excessive,
95	inadequate, or unfairly discriminatory.
96	4.  A rating organization must notify the office of any
97	changes to loss cost for insurance and risks described in
98	subparagraph 1. no later than 30 days after the effective date
99	of the change. The notice must include the name of the rating
100	organization, the type or kind of insurance subject to a loss
101	cost change, loss costs during the immediately preceding year
102	for the type or kind of insurance subject to the loss cost
103	change, and the average statewide percentage change in loss
104	cost. Actuarial data Loss and exposure statistics with regard to
105	changes to loss cost for risks applicable to loss costs for a
106	rating organization not subject to paragraph (2)(a) or paragraph
107	(2)(f) shall be maintained by the rating organization for 2
108	years after the effective date of the change and are subject to
109	examination by the office. Upon examination, the office shall,
110	in accordance with generally accepted and reasonable actuarial
111	techniques, consider the rate factors in paragraphs (2)(b)-(d)
112	and the standards in paragraph (2)(e) to determine if the rate
113	is excessive, inadequate, or unfairly discriminatory.
114	5.  In reviewing a rate, the office may require the insurer
115	to provide at the insurer's expense all information necessary to
116	evaluate the condition of the company and the reasonableness of
117	the rate according to the applicable criteria described in this
118	section.
119	Section 2.  Subsection (14) of section 627.0651, Florida
120	Statutes, is amended to read:
121	627.0651  Making and use of rates for motor vehicle
122	insurance.-
123	(14)(a)  Commercial motor vehicle insurance covering a
124	fleet of 20 or more self-propelled vehicles is not subject to
125	subsection (1), subsection (2), or subsection (9) or s.
126	627.0645.
127	(b)  The rates for insurance described in this subsection
128	may not be excessive, inadequate, or unfairly discriminatory.
129	(c)  Insurers shall establish and use rates, rating
130	schedules, or rating manuals to allow the insurer a reasonable
131	rate of return on commercial motor vehicle insurance written in
132	this state covering a fleet of 20 or more self-propelled
133	vehicles.
134	(d)  An insurer must notify the office of any changes to
135	rates for type of insurance described in this subsection no
136	later than 30 days after the effective date of the change. The
137	notice shall include the name of the insurer, the type or kind
138	of insurance subject to rate change, total premium written
139	during the immediately preceding year by the insurer for the
140	type or kind of insurance subject to the rate change, and the
141	average statewide percentage change in rates. Actuarial data
142	with regard to rates for risks Underwriting files, premiums,
143	losses, and expense statistics for the type of insurance
144	described in this subsection shall be maintained by the insurer
145	for 2 years after the effective date of changes to those rates
146	and are subject to examination by the office. Upon examination,
147	the office shall, in accordance with generally accepted and
148	reasonable actuarial techniques, consider the factors in
149	paragraphs (2)(a)-(l) and apply subsections (3)-(8) to determine
150	if the rate is excessive, inadequate, or unfairly
151	discriminatory.
152	(e)  A rating organization must notify the office of any
153	changes to loss cost for the type of insurance described in this
154	subsection no later than 30 days after the effective date of the
155	change. The notice shall include the name of the rating
156	organization, the type or kind of insurance subject to a loss
157	cost change, loss costs during the immediately preceding year
158	for the type or kind of insurance subject to the loss cost
159	change, and the average statewide percentage change in loss
160	cost. Actuarial data Loss and exposure statistics with regard to
161	changes to loss cost for risks applicable to loss costs for a
162	rating organization not subject to subsection (1), subsection
163	(2), or subsection (9) shall be maintained by the rating
164	organization for 2 years after the effective date of the change
165	and are subject to examination by the office. Upon examination,
166	the office shall, in accordance with generally accepted and
167	reasonable actuarial techniques, consider the rate factors in
168	paragraphs (2)(a)-(l) and apply subsections (3)-(8) to determine
169	if the rate is excessive, inadequate, or unfairly
170	discriminatory.
171	(f)  In reviewing the rate, the office may require the
172	insurer to provide at the insurer's expense all information
173	necessary to evaluate the condition of the company and the
174	reasonableness of the rate according to the applicable criteria
175	described herein.
176	Section 3.  This act shall take effect October 1, 2011.

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