Florida Senate - 2013 SENATOR AMENDMENT
Bill No. CS for SB 1770
Senate . House
Floor: 19/F/2R .
04/11/2013 04:26 PM .
Senator Simpson moved the following:
1 Senate Amendment (with directory and title amendments)
3 Between lines 2189 and 2190
5 (ee)1. The corporation may not decline a request for
6 coverage of residential sinkhole loss based upon: conditions
7 existing at or on the property which do not constitute sinkhole
8 related activity; or the proximity of the property to the
9 location of another property on which conditions exist which do
10 not constitute sinkhole-related activity.
11 a. For the purposes of this subparagraph, the term
12 “sinkhole-related activity” means settlement or systematic
13 weakening of the earth if the settlement or systematic weakening
14 results from contemporaneous movement or raveling of soils,
15 sediments, or rock materials into subterranean voids created by
16 the effect of water on a limestone or similar rock formation.
17 b. On or before December 31 of each calendar year, the
18 corporation shall submit an annual report to the Office of
19 Insurance Regulation and the Insurance Consumer Advocate
21 (I) The total number of requests received for residential
22 sinkhole loss coverage;
23 (II) The total number of policies issued for residential
24 sinkhole loss coverage;
25 (III) The total number of requests declined for residential
26 sinkhole loss coverage; and
27 (IV) The reasons for each decline of residential sinkhole
28 loss coverage.
29 2. A policy for residential property insurance issued by
30 the corporation must include a deductible applicable to sinkhole
31 losses equal to 1 percent, 2 percent, 5 percent, or 10 percent
32 of the policy dwelling limits, with an appropriate premium
33 discount amount offered with each deductible amount.
34 3. The Legislature finds that it is in the public interest
35 that indemnity funds paid pursuant to sinkhole loss claims are
36 applied to repairing property damage in order to ensure that
37 sinkhole indemnity funds paid for sinkhole damage are applied to
38 above-ground and subsurface repairs. Therefore, a Citizens
39 Sinkhole Repair Program shall be established by the corporation,
40 subject to approval by the Office of Insurance Regulation and
41 the Financial Services Commission. Any claim against a
42 corporation policy that covers residential sinkhole loss for
43 which it is determined that such loss has occurred must be
44 included in the repair program.
45 a. The repair program may be managed by a third-party
46 administrator and, at a minimum, must include the following
48 (I) The corporation may not require the policyholder to
49 advance payment for repairs.
50 (II) All applicable provisions contained in the
51 corporation’s plan of operation apply, including, but not
52 limited to, the consumer’s right to courteous, prompt, and
53 professional customer service and the right to fair, prompt and
54 professional services.
55 (III) Repairs shall be conducted by repair contractors who
56 are qualified based upon guidelines adopted by the Financial
57 Services Commission by rule.
58 (A) The repair program shall select qualified repair
59 contractors to perform repairs to damaged property pursuant to a
60 fixed-price contract between the contractor and the
61 policyholder. Pursuant to the terms of the contract, the
62 selected repair contractor is solely responsible for the
63 performance of all necessary repairs.
64 (B) Each qualified contractor shall post a performance
65 bond, secured by a third-party surety, in favor of the
66 corporation as obligee, in a principle amount equal to the total
67 cost of all fixed-price contracts annually awarded to that
68 repair contractor.
69 (C) Each repair contractor shall also provide a warranty to
70 the policyholder which covers all repairs provided by the
71 contractor for at least 5 years after completion of the repairs.
72 b. The corporation is not responsible for serving as a
73 repair contractor. The corporation’s obligations pursuant to the
74 repair program are not an election to repair by the corporation
75 and therefore do not imply a new contractual relationship.
76 c. The corporation’s liability related to repair activity
77 for damaged property included in the repair program is no
78 greater than the limits of the policy covering that property.
79 d. For the purposes of the repair program, the presumed
80 correctness specified in s. 627.7073(1)(c) of the findings,
81 opinions, and recommendations by the professional engineer or
82 geologist as to land and building stabilization and foundation
83 repair are recognized by the Legislature as necessary to address
84 the public policy interest in ensuring that sinkhole-damaged
85 residential property is repaired. Therefore, the presumption is
86 intended to operate as a burden-shifting presumption under ss.
87 90.302(2) and 90.304.
The office may establish a pilot program
88 to offer optional sinkhole coverage in one or more counties or
89 other territories of the corporation for the purpose of
90 implementing s. 627.706 , as amended by s. 30, chapter 2007-1,
91 Laws of Florida. Under the pilot program, the corporation is not
92 required to issue a notice of nonrenewal to exclude sinkhole
93 coverage upon the renewal of existing policies, but may exclude
94 such coverage using a notice of coverage change.
96 ====== D I R E C T O R Y C L A U S E A M E N D M E N T ======
97 And the directory clause is amended as follows:
98 Delete line 765
99 and insert:
100 (z), and (ee) of subsection (6) of section 627.351, Florida
103 ================= T I T L E A M E N D M E N T ================
104 And the title is amended as follows:
105 Delete line 69
106 and insert:
107 secured by a surplus note; prohibiting the corporation
108 from denying sinkhole coverage for certain reasons;
109 requiring the corporation to submit an annual report
110 to the Office of Insurance Regulation and the
111 Insurance Consumer Advocate on the number of
112 residential sinkhole policies issued and declined;
113 requiring the policy to include a deductible;
114 establishing a Citizens Sinkhole Repair Program for
115 sinkhole claims; providing program components;
116 specifying the corporation’s liability with respect to
117 sinkhole claims; specifying the presumed correctness
118 of professional engineer and geologist opinions;
119 deleting obsolete provisions; requiring the