Florida Senate - 2013 SB 1428 By Senator Flores 37-01266-13 20131428__ 1 A bill to be entitled 2 An act relating to Citizens Property Insurance 3 Corporation; amending s. 627.351, F.S.; revising the 4 membership of the board of governors of the 5 corporation to require that two members be residents 6 of specified counties and provide for the Chief 7 Financial Officer’s appointment of an additional 8 member to serve as a consumer advocate; providing an 9 effective date. 10 11 Be It Enacted by the Legislature of the State of Florida: 12 13 Section 1. Paragraph (c) of subsection (6) of section 14 627.351, Florida Statutes, is amended to read: 15 627.351 Insurance risk apportionment plans.— 16 (6) CITIZENS PROPERTY INSURANCE CORPORATION.— 17 (c) The corporation’s plan of operation: 18 1. Must provide for adoption of residential property and 19 casualty insurance policy forms and commercial residential and 20 nonresidential property insurance forms, which must be approved 21 by the office before use. The corporation shall adopt the 22 following policy forms: 23 a. Standard personal lines policy forms that are 24 comprehensive multiperil policies providing full coverage of a 25 residential property equivalent to the coverage provided in the 26 private insurance market under an HO-3, HO-4, or HO-6 policy. 27 b. Basic personal lines policy forms that are policies 28 similar to an HO-8 policy or a dwelling fire policy that provide 29 coverage meeting the requirements of the secondary mortgage 30 market, but which is more limited than the coverage under a 31 standard policy. 32 c. Commercial lines residential and nonresidential policy 33 forms that are generally similar to the basic perils of full 34 coverage obtainable for commercial residential structures and 35 commercial nonresidential structures in the admitted voluntary 36 market. 37 d. Personal lines and commercial lines residential property 38 insurance forms that cover the peril of wind only. The forms are 39 applicable only to residential properties located in areas 40 eligible for coverage under the coastal account referred to in 41 sub-subparagraph (b)2.a. 42 e. Commercial lines nonresidential property insurance forms 43 that cover the peril of wind only. The forms are applicable only 44 to nonresidential properties located in areas eligible for 45 coverage under the coastal account referred to in sub 46 subparagraph (b)2.a. 47 f. The corporation may adopt variations of the policy forms 48 listed in sub-subparagraphs a.-e. which contain more restrictive 49 coverage. 50 g. Effective January 1, 2013, the corporation shall offer a 51 basic personal lines policy similar to an HO-8 policy with 52 dwelling repair based on common construction materials and 53 methods. 54 2. Must provide that the corporation adopt a program in 55 which the corporation and authorized insurers enter into quota 56 share primary insurance agreements for hurricane coverage, as 57 defined in s. 627.4025(2)(a), for eligible risks, and adopt 58 property insurance forms for eligible risks which cover the 59 peril of wind only. 60 a. As used in this subsection, the term: 61 (I) “Quota share primary insurance” means an arrangement in 62 which the primary hurricane coverage of an eligible risk is 63 provided in specified percentages by the corporation and an 64 authorized insurer. The corporation and authorized insurer are 65 each solely responsible for a specified percentage of hurricane 66 coverage of an eligible risk as set forth in a quota share 67 primary insurance agreement between the corporation and an 68 authorized insurer and the insurance contract. The 69 responsibility of the corporation or authorized insurer to pay 70 its specified percentage of hurricane losses of an eligible 71 risk, as set forth in the agreement, may not be altered by the 72 inability of the other party to pay its specified percentage of 73 losses. Eligible risks that are provided hurricane coverage 74 through a quota share primary insurance arrangement must be 75 provided policy forms that set forth the obligations of the 76 corporation and authorized insurer under the arrangement, 77 clearly specify the percentages of quota share primary insurance 78 provided by the corporation and authorized insurer, and 79 conspicuously and clearly state that the authorized insurer and 80 the corporation may not be held responsible beyond their 81 specified percentage of coverage of hurricane losses. 82 (II) “Eligible risks” means personal lines residential and 83 commercial lines residential risks that meet the underwriting 84 criteria of the corporation and are located in areas that were 85 eligible for coverage by the Florida Windstorm Underwriting 86 Association on January 1, 2002. 87 b. The corporation may enter into quota share primary 88 insurance agreements with authorized insurers at corporation 89 coverage levels of 90 percent and 50 percent. 90 c. If the corporation determines that additional coverage 91 levels are necessary to maximize participation in quota share 92 primary insurance agreements by authorized insurers, the 93 corporation may establish additional coverage levels. However, 94 the corporation’s quota share primary insurance coverage level 95 may not exceed 90 percent. 96 d. Any quota share primary insurance agreement entered into 97 between an authorized insurer and the corporation must provide 98 for a uniform specified percentage of coverage of hurricane 99 losses, by county or territory as set forth by the corporation 100 board, for all eligible risks of the authorized insurer covered 101 under the agreement. 102 e. Any quota share primary insurance agreement entered into 103 between an authorized insurer and the corporation is subject to 104 review and approval by the office. However, such agreement shall 105 be authorized only as to insurance contracts entered into 106 between an authorized insurer and an insured who is already 107 insured by the corporation for wind coverage. 108 f. For all eligible risks covered under quota share primary 109 insurance agreements, the exposure and coverage levels for both 110 the corporation and authorized insurers shall be reported by the 111 corporation to the Florida Hurricane Catastrophe Fund. For all 112 policies of eligible risks covered under such agreements, the 113 corporation and the authorized insurer must maintain complete 114 and accurate records for the purpose of exposure and loss 115 reimbursement audits as required by fund rules. The corporation 116 and the authorized insurer shall each maintain duplicate copies 117 of policy declaration pages and supporting claims documents. 118 g. The corporation board shall establish in its plan of 119 operation standards for quota share agreements which ensure that 120 there is no discriminatory application among insurers as to the 121 terms of the agreements, pricing of the agreements, incentive 122 provisions if any, and consideration paid for servicing policies 123 or adjusting claims. 124 h. The quota share primary insurance agreement between the 125 corporation and an authorized insurer must set forth the 126 specific terms under which coverage is provided, including, but 127 not limited to, the sale and servicing of policies issued under 128 the agreement by the insurance agent of the authorized insurer 129 producing the business, the reporting of information concerning 130 eligible risks, the payment of premium to the corporation, and 131 arrangements for the adjustment and payment of hurricane claims 132 incurred on eligible risks by the claims adjuster and personnel 133 of the authorized insurer. Entering into a quota sharing 134 insurance agreement between the corporation and an authorized 135 insurer is voluntary and at the discretion of the authorized 136 insurer. 137 3.a. May provide that the corporation may employ or 138 otherwise contract with individuals or other entities to provide 139 administrative or professional services that may be appropriate 140 to effectuate the plan. The corporation may borrow funds by 141 issuing bonds or by incurring other indebtedness, and shall have 142 other powers reasonably necessary to effectuate the requirements 143 of this subsection, including, without limitation, the power to 144 issue bonds and incur other indebtedness in order to refinance 145 outstanding bonds or other indebtedness. The corporation may 146 seek judicial validation of its bonds or other indebtedness 147 under chapter 75. The corporation may issue bonds or incur other 148 indebtedness, or have bonds issued on its behalf by a unit of 149 local government pursuant to subparagraph (q)2. in the absence 150 of a hurricane or other weather-related event, upon a 151 determination by the corporation, subject to approval by the 152 office, that such action would enable it to efficiently meet the 153 financial obligations of the corporation and that such 154 financings are reasonably necessary to effectuate the 155 requirements of this subsection. The corporation may take all 156 actions needed to facilitate tax-free status for such bonds or 157 indebtedness, including formation of trusts or other affiliated 158 entities. The corporation may pledge assessments, projected 159 recoveries from the Florida Hurricane Catastrophe Fund, other 160 reinsurance recoverables, policyholder surcharges and other 161 surcharges, and other funds available to the corporation as 162 security for bonds or other indebtedness. In recognition of s. 163 10, Art. I of the State Constitution, prohibiting the impairment 164 of obligations of contracts, it is the intent of the Legislature 165 that no action be taken whose purpose is to impair any bond 166 indenture or financing agreement or any revenue source committed 167 by contract to such bond or other indebtedness. 168 b. To ensure that the corporation is operating in an 169 efficient and economic manner while providing quality service to 170 policyholders, applicants, and agents, the board shall 171 commission an independent third-party consultant having 172 expertise in insurance company management or insurance company 173 management consulting to prepare a report and make 174 recommendations on the relative costs and benefits of 175 outsourcing various policy issuance and service functions to 176 private servicing carriers or entities performing similar 177 functions in the private market for a fee, rather than 178 performing such functions in-house. In making such 179 recommendations, the consultant shall consider how other 180 residual markets, both in this state and around the country, 181 outsource appropriate functions or use servicing carriers to 182 better match expenses with revenues that fluctuate based on a 183 widely varying policy count. The report must be completed by 184 July 1, 2012. Upon receiving the report, the board shall develop 185 a plan to implement the report and submit the plan for review, 186 modification, and approval to the Financial Services Commission. 187 Upon the commission’s approval of the plan, the board shall 188 begin implementing the plan by January 1, 2013. 189 4. Must require that the corporation operate subject to the 190 supervision and approval of a board of governors consisting of 191 nine
eightindividuals who are residents of this state, one of 192 whom is a resident of Miami-Dade County, one of whom is a 193 resident of Monroe County, six of whom are from different 194 geographical areas of this state, and one of whom is appointed 195 by the Chief Financial Officer and serves solely as a consumer 196 advocate. The appointment of a consumer advocate by the Chief 197 Financial Officer is in addition to the appointments authorized 198 under sub-subparagraph a. 199 a. The Governor, the Chief Financial Officer, the President 200 of the Senate, and the Speaker of the House of Representatives 201 shall each appoint two members of the board. At least one of the 202 two members appointed by each appointing officer must have 203 demonstrated expertise in insurance and is deemed to be within 204 the scope of the exemption provided in s. 112.313(7)(b). The 205 Chief Financial Officer shall designate one of the appointees as 206 chair. All board members serve at the pleasure of the appointing 207 officer. All members of the board are subject to removal at will 208 by the officers who appointed them. All board members, including 209 the chair, must be appointed to serve for 3-year terms beginning 210 annually on a date designated by the plan. However, for the 211 first term beginning on or after July 1, 2009, each appointing 212 officer shall appoint one member of the board for a 2-year term 213 and one member for a 3-year term. A board vacancy shall be 214 filled for the unexpired term by the appointing officer. The 215 Chief Financial Officer shall appoint a technical advisory group 216 to provide information and advice to the board in connection 217 with the board’s duties under this subsection. The executive 218 director and senior managers of the corporation shall be engaged 219 by the board and serve at the pleasure of the board. Any 220 executive director appointed on or after July 1, 2006, is 221 subject to confirmation by the Senate. The executive director is 222 responsible for employing other staff as the corporation may 223 require, subject to review and concurrence by the board. 224 b. The board shall create a Market Accountability Advisory 225 Committee to assist the corporation in developing awareness of 226 its rates and its customer and agent service levels in 227 relationship to the voluntary market insurers writing similar 228 coverage. 229 (I) The members of the advisory committee consist of the 230 following 11 persons, one of whom must be elected chair by the 231 members of the committee: four representatives, one appointed by 232 the Florida Association of Insurance Agents, one by the Florida 233 Association of Insurance and Financial Advisors, one by the 234 Professional Insurance Agents of Florida, and one by the Latin 235 American Association of Insurance Agencies; three 236 representatives appointed by the insurers with the three highest 237 voluntary market share of residential property insurance 238 business in the state; one representative from the Office of 239 Insurance Regulation; one consumer appointed by the board who is 240 insured by the corporation at the time of appointment to the 241 committee; one representative appointed by the Florida 242 Association of Realtors; and one representative appointed by the 243 Florida Bankers Association. All members shall be appointed to 244 3-year terms and may serve for consecutive terms. 245 (II) The committee shall report to the corporation at each 246 board meeting on insurance market issues which may include rates 247 and rate competition with the voluntary market; service, 248 including policy issuance, claims processing, and general 249 responsiveness to policyholders, applicants, and agents; and 250 matters relating to depopulation. 251 5. Must provide a procedure for determining the eligibility 252 of a risk for coverage, as follows: 253 a. Subject to s. 627.3517, with respect to personal lines 254 residential risks, if the risk is offered coverage from an 255 authorized insurer at the insurer’s approved rate under a 256 standard policy including wind coverage or, if consistent with 257 the insurer’s underwriting rules as filed with the office, a 258 basic policy including wind coverage, for a new application to 259 the corporation for coverage, the risk is not eligible for any 260 policy issued by the corporation unless the premium for coverage 261 from the authorized insurer is more than 15 percent greater than 262 the premium for comparable coverage from the corporation. If the 263 risk is not able to obtain such offer, the risk is eligible for 264 a standard policy including wind coverage or a basic policy 265 including wind coverage issued by the corporation; however, if 266 the risk could not be insured under a standard policy including 267 wind coverage regardless of market conditions, the risk is 268 eligible for a basic policy including wind coverage unless 269 rejected under subparagraph 8. However, a policyholder of the 270 corporation or a policyholder removed from the corporation 271 through an assumption agreement until the end of the assumption 272 period remains eligible for coverage from the corporation 273 regardless of any offer of coverage from an authorized insurer 274 or surplus lines insurer. The corporation shall determine the 275 type of policy to be provided on the basis of objective 276 standards specified in the underwriting manual and based on 277 generally accepted underwriting practices. 278 (I) If the risk accepts an offer of coverage through the 279 market assistance plan or through a mechanism established by the 280 corporation before a policy is issued to the risk by the 281 corporation or during the first 30 days of coverage by the 282 corporation, and the producing agent who submitted the 283 application to the plan or to the corporation is not currently 284 appointed by the insurer, the insurer shall: 285 (A) Pay to the producing agent of record of the policy for 286 the first year, an amount that is the greater of the insurer’s 287 usual and customary commission for the type of policy written or 288 a fee equal to the usual and customary commission of the 289 corporation; or 290 (B) Offer to allow the producing agent of record of the 291 policy to continue servicing the policy for at least 1 year and 292 offer to pay the agent the greater of the insurer’s or the 293 corporation’s usual and customary commission for the type of 294 policy written. 295 296 If the producing agent is unwilling or unable to accept 297 appointment, the new insurer shall pay the agent in accordance 298 with sub-sub-sub-subparagraph (A). 299 (II) If the corporation enters into a contractual agreement 300 for a take-out plan, the producing agent of record of the 301 corporation policy is entitled to retain any unearned commission 302 on the policy, and the insurer shall: 303 (A) Pay to the producing agent of record, for the first 304 year, an amount that is the greater of the insurer’s usual and 305 customary commission for the type of policy written or a fee 306 equal to the usual and customary commission of the corporation; 307 or 308 (B) Offer to allow the producing agent of record to 309 continue servicing the policy for at least 1 year and offer to 310 pay the agent the greater of the insurer’s or the corporation’s 311 usual and customary commission for the type of policy written. 312 313 If the producing agent is unwilling or unable to accept 314 appointment, the new insurer shall pay the agent in accordance 315 with sub-sub-sub-subparagraph (A). 316 b. With respect to commercial lines residential risks, for 317 a new application to the corporation for coverage, if the risk 318 is offered coverage under a policy including wind coverage from 319 an authorized insurer at its approved rate, the risk is not 320 eligible for a policy issued by the corporation unless the 321 premium for coverage from the authorized insurer is more than 15 322 percent greater than the premium for comparable coverage from 323 the corporation. If the risk is not able to obtain any such 324 offer, the risk is eligible for a policy including wind coverage 325 issued by the corporation. However, a policyholder of the 326 corporation or a policyholder removed from the corporation 327 through an assumption agreement until the end of the assumption 328 period remains eligible for coverage from the corporation 329 regardless of an offer of coverage from an authorized insurer or 330 surplus lines insurer. 331 (I) If the risk accepts an offer of coverage through the 332 market assistance plan or through a mechanism established by the 333 corporation before a policy is issued to the risk by the 334 corporation or during the first 30 days of coverage by the 335 corporation, and the producing agent who submitted the 336 application to the plan or the corporation is not currently 337 appointed by the insurer, the insurer shall: 338 (A) Pay to the producing agent of record of the policy, for 339 the first year, an amount that is the greater of the insurer’s 340 usual and customary commission for the type of policy written or 341 a fee equal to the usual and customary commission of the 342 corporation; or 343 (B) Offer to allow the producing agent of record of the 344 policy to continue servicing the policy for at least 1 year and 345 offer to pay the agent the greater of the insurer’s or the 346 corporation’s usual and customary commission for the type of 347 policy written. 348 349 If the producing agent is unwilling or unable to accept 350 appointment, the new insurer shall pay the agent in accordance 351 with sub-sub-sub-subparagraph (A). 352 (II) If the corporation enters into a contractual agreement 353 for a take-out plan, the producing agent of record of the 354 corporation policy is entitled to retain any unearned commission 355 on the policy, and the insurer shall: 356 (A) Pay to the producing agent of record, for the first 357 year, an amount that is the greater of the insurer’s usual and 358 customary commission for the type of policy written or a fee 359 equal to the usual and customary commission of the corporation; 360 or 361 (B) Offer to allow the producing agent of record to 362 continue servicing the policy for at least 1 year and offer to 363 pay the agent the greater of the insurer’s or the corporation’s 364 usual and customary commission for the type of policy written. 365 366 If the producing agent is unwilling or unable to accept 367 appointment, the new insurer shall pay the agent in accordance 368 with sub-sub-sub-subparagraph (A). 369 c. For purposes of determining comparable coverage under 370 sub-subparagraphs a. and b., the comparison must be based on 371 those forms and coverages that are reasonably comparable. The 372 corporation may rely on a determination of comparable coverage 373 and premium made by the producing agent who submits the 374 application to the corporation, made in the agent’s capacity as 375 the corporation’s agent. A comparison may be made solely of the 376 premium with respect to the main building or structure only on 377 the following basis: the same coverage A or other building 378 limits; the same percentage hurricane deductible that applies on 379 an annual basis or that applies to each hurricane for commercial 380 residential property; the same percentage of ordinance and law 381 coverage, if the same limit is offered by both the corporation 382 and the authorized insurer; the same mitigation credits, to the 383 extent the same types of credits are offered both by the 384 corporation and the authorized insurer; the same method for loss 385 payment, such as replacement cost or actual cash value, if the 386 same method is offered both by the corporation and the 387 authorized insurer in accordance with underwriting rules; and 388 any other form or coverage that is reasonably comparable as 389 determined by the board. If an application is submitted to the 390 corporation for wind-only coverage in the coastal account, the 391 premium for the corporation’s wind-only policy plus the premium 392 for the ex-wind policy that is offered by an authorized insurer 393 to the applicant must be compared to the premium for multiperil 394 coverage offered by an authorized insurer, subject to the 395 standards for comparison specified in this subparagraph. If the 396 corporation or the applicant requests from the authorized 397 insurer a breakdown of the premium of the offer by types of 398 coverage so that a comparison may be made by the corporation or 399 its agent and the authorized insurer refuses or is unable to 400 provide such information, the corporation may treat the offer as 401 not being an offer of coverage from an authorized insurer at the 402 insurer’s approved rate. 403 6. Must include rules for classifications of risks and 404 rates. 405 7. Must provide that if premium and investment income for 406 an account attributable to a particular calendar year are in 407 excess of projected losses and expenses for the account 408 attributable to that year, such excess shall be held in surplus 409 in the account. Such surplus must be available to defray 410 deficits in that account as to future years and used for that 411 purpose before assessing assessable insurers and assessable 412 insureds as to any calendar year. 413 8. Must provide objective criteria and procedures to be 414 uniformly applied to all applicants in determining whether an 415 individual risk is so hazardous as to be uninsurable. In making 416 this determination and in establishing the criteria and 417 procedures, the following must be considered: 418 a. Whether the likelihood of a loss for the individual risk 419 is substantially higher than for other risks of the same class; 420 and 421 b. Whether the uncertainty associated with the individual 422 risk is such that an appropriate premium cannot be determined. 423 424 The acceptance or rejection of a risk by the corporation shall 425 be construed as the private placement of insurance, and the 426 provisions of chapter 120 do not apply. 427 9. Must provide that the corporation make its best efforts 428 to procure catastrophe reinsurance at reasonable rates, to cover 429 its projected 100-year probable maximum loss as determined by 430 the board of governors. 431 10. The policies issued by the corporation must provide 432 that if the corporation or the market assistance plan obtains an 433 offer from an authorized insurer to cover the risk at its 434 approved rates, the risk is no longer eligible for renewal 435 through the corporation, except as otherwise provided in this 436 subsection. 437 11. Corporation policies and applications must include a 438 notice that the corporation policy could, under this section, be 439 replaced with a policy issued by an authorized insurer which 440 does not provide coverage identical to the coverage provided by 441 the corporation. The notice must also specify that acceptance of 442 corporation coverage creates a conclusive presumption that the 443 applicant or policyholder is aware of this potential. 444 12. May establish, subject to approval by the office, 445 different eligibility requirements and operational procedures 446 for any line or type of coverage for any specified county or 447 area if the board determines that such changes are justified due 448 to the voluntary market being sufficiently stable and 449 competitive in such area or for such line or type of coverage 450 and that consumers who, in good faith, are unable to obtain 451 insurance through the voluntary market through ordinary methods 452 continue to have access to coverage from the corporation. If 453 coverage is sought in connection with a real property transfer, 454 the requirements and procedures may not provide an effective 455 date of coverage later than the date of the closing of the 456 transfer as established by the transferor, the transferee, and, 457 if applicable, the lender. 458 13. Must provide that, with respect to the coastal account, 459 any assessable insurer with a surplus as to policyholders of $25 460 million or less writing 25 percent or more of its total 461 countrywide property insurance premiums in this state may 462 petition the office, within the first 90 days of each calendar 463 year, to qualify as a limited apportionment company. A regular 464 assessment levied by the corporation on a limited apportionment 465 company for a deficit incurred by the corporation for the 466 coastal account may be paid to the corporation on a monthly 467 basis as the assessments are collected by the limited 468 apportionment company from its insureds, but a limited 469 apportionment company must begin collecting the regular 470 assessments not later than 90 days after the regular assessments 471 are levied by the corporation, and the regular assessments must 472 be paid in full within 15 months after being levied by the 473 corporation. A limited apportionment company shall collect from 474 its policyholders any emergency assessment imposed under sub 475 subparagraph (b)3.d. The plan must provide that, if the office 476 determines that any regular assessment will result in an 477 impairment of the surplus of a limited apportionment company, 478 the office may direct that all or part of such assessment be 479 deferred as provided in subparagraph (q)4. However, an emergency 480 assessment to be collected from policyholders under sub 481 subparagraph (b)3.d. may not be limited or deferred. 482 14. Must provide that the corporation appoint as its 483 licensed agents only those agents who also hold an appointment 484 as defined in s. 626.015(3) with an insurer who at the time of 485 the agent’s initial appointment by the corporation is authorized 486 to write and is actually writing personal lines residential 487 property coverage, commercial residential property coverage, or 488 commercial nonresidential property coverage within the state. 489 15. Must provide a premium payment plan option to its 490 policyholders which, at a minimum, allows for quarterly and 491 semiannual payment of premiums. A monthly payment plan may, but 492 is not required to, be offered. 493 16. Must limit coverage on mobile homes or manufactured 494 homes built before 1994 to actual cash value of the dwelling 495 rather than replacement costs of the dwelling. 496 17. May provide such limits of coverage as the board 497 determines, consistent with the requirements of this subsection. 498 18. May require commercial property to meet specified 499 hurricane mitigation construction features as a condition of 500 eligibility for coverage. 501 19. Must provide that new or renewal policies issued by the 502 corporation on or after January 1, 2012, which cover sinkhole 503 loss do not include coverage for any loss to appurtenant 504 structures, driveways, sidewalks, decks, or patios that are 505 directly or indirectly caused by sinkhole activity. The 506 corporation shall exclude such coverage using a notice of 507 coverage change, which may be included with the policy renewal, 508 and not by issuance of a notice of nonrenewal of the excluded 509 coverage upon renewal of the current policy. 510 20. As of January 1, 2012, must require that the agent 511 obtain from an applicant for coverage from the corporation an 512 acknowledgment signed by the applicant, which includes, at a 513 minimum, the following statement: 514 ACKNOWLEDGMENT OF POTENTIAL SURCHARGE 515 AND ASSESSMENT LIABILITY: 516 1. AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE 517 CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A 518 DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON, 519 MY POLICY COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND 520 PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF THE 521 POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH AS 45 PERCENT 522 OF MY PREMIUM, OR A DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA 523 LEGISLATURE. 524 2. I ALSO UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY 525 ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER 526 INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE 527 FLORIDA LEGISLATURE. 528 3. I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE 529 CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE 530 STATE OF FLORIDA. 531 a. The corporation shall maintain, in electronic format or 532 otherwise, a copy of the applicant’s signed acknowledgment and 533 provide a copy of the statement to the policyholder as part of 534 the first renewal after the effective date of this subparagraph. 535 b. The signed acknowledgment form creates a conclusive 536 presumption that the policyholder understood and accepted his or 537 her potential surcharge and assessment liability as a 538 policyholder of the corporation. 539 Section 2. This act shall take effect July 1, 2013.