Florida Senate - 2014                        COMMITTEE AMENDMENT
       Bill No. CS for SB 1344
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  04/02/2014           .                                

    1         Senate Amendment (with title amendment)
    3         Before line 13
    4  insert:
    5         Section 1. Paragraph (c) of subsection (2) and subsection
    6  (3) of section 626.8805, Florida Statutes, are amended to read:
    7         626.8805 Certificate of authority to act as administrator.—
    8         (2) The administrator shall file with the office an
    9  application for a certificate of authority upon a form to be
   10  adopted by the commission and furnished by the office, which
   11  application shall include or have attached the following
   12  information and documents:
   13         (c) The names, addresses, official positions, and
   14  professional qualifications of the individuals employed or
   15  retained by the administrator who are responsible for the
   16  conduct of the affairs of the administrator, including all
   17  members of the board of directors, board of trustees, executive
   18  committee, or other governing board or committee, and the
   19  principal officers in the case of a corporation or, the partners
   20  or members in the case of a partnership or association, and any
   21  other person who exercises control or influence over the affairs
   22  of the administrator.
   24  The applicant shall also include such other information as the
   25  office requires in order to review the current financial
   26  condition of the applicant.
   27         (3) The applicant shall make available for inspection by
   28  the office copies of all contracts relating to services provided
   29  by the administrator to with insurers or other persons using
   30  utilizing the services of the administrator.
   31         Section 2. Subsections (1) and (3) of section 626.8817,
   32  Florida Statutes, are amended to read:
   33         626.8817 Responsibilities of insurance company with respect
   34  to administration of coverage insured.—
   35         (1) If an insurer uses the services of an administrator,
   36  the insurer is responsible for determining the benefits, premium
   37  rates, underwriting criteria, and claims payment procedures
   38  applicable to the coverage and for securing reinsurance, if any.
   39  The rules pertaining to these matters shall be provided, in
   40  writing, by the insurer or its designee to the administrator.
   41  The responsibilities of the administrator as to any of these
   42  matters shall be set forth in a the written agreement binding
   43  upon between the administrator and the insurer.
   44         (3) If In cases in which an administrator administers
   45  benefits for more than 100 certificateholders on behalf of an
   46  insurer, the insurer shall, at least semiannually, conduct a
   47  review of the operations of the administrator. At least one such
   48  review must be an onsite audit of the operations of the
   49  administrator. The insurer may contract with a qualified third
   50  party to conduct such review.
   51         Section 3. Subsections (1) and (4) of section 626.882,
   52  Florida Statutes, are amended to read:
   53         626.882 Agreement between administrator and insurer;
   54  required provisions; maintenance of records.—
   55         (1) A No person may not act as an administrator without a
   56  written agreement, as required under s. 626.8817, which
   57  specifies the rights, duties, and obligations of the between
   58  such person as administrator and an insurer.
   59         (4) If a policy is issued to a trustee or trustees, a copy
   60  of the trust agreement and any amendments to that agreement
   61  shall be furnished to the insurer or its designee by the
   62  administrator and shall be retained as part of the official
   63  records of both the administrator and the insurer for the
   64  duration of the policy and for 5 years thereafter.
   65         Section 4. Subsections (3), (4), and (5) of section
   66  626.883, Florida Statutes, are amended to read:
   67         626.883 Administrator as intermediary; collections held in
   68  fiduciary capacity; establishment of account; disbursement;
   69  payments on behalf of insurer.—
   70         (3) If charges or premiums deposited in a fiduciary account
   71  have been collected on behalf of or for more than one insurer,
   72  the administrator shall keep records clearly recording the
   73  deposits in and withdrawals from such account on behalf of or
   74  for each insurer. The administrator shall, upon request of an
   75  insurer or its designee, furnish such insurer or designee with
   76  copies of records pertaining to deposits and withdrawals on
   77  behalf of or for such insurer.
   78         (4) The administrator may not pay any claim by withdrawals
   79  from a fiduciary account. Withdrawals from such account shall be
   80  made as provided in the written agreement required under ss.
   81  626.8817 and 626.882 between the administrator and the insurer
   82  for any of the following:
   83         (a) Remittance to an insurer entitled to such remittance.
   84         (b) Deposit in an account maintained in the name of such
   85  insurer.
   86         (c) Transfer to and deposit in a claims-paying account,
   87  with claims to be paid as provided by such insurer.
   88         (d) Payment to a group policyholder for remittance to the
   89  insurer entitled to such remittance.
   90         (e) Payment to the administrator of the commission, fees,
   91  or charges of the administrator.
   92         (f) Remittance of return premium to the person or persons
   93  entitled to such return premium.
   94         (5) All claims paid by the administrator from funds
   95  collected on behalf of the insurer shall be paid only on drafts
   96  of, and as authorized by, such insurer or its designee.
   97         Section 5. Subsection (3) of section 626.884, Florida
   98  Statutes, is amended to read:
   99         626.884 Maintenance of records by administrator; access;
  100  confidentiality.—
  101         (3) The insurer shall retain the right of continuing access
  102  to books and records maintained by the administrator sufficient
  103  to permit the insurer to fulfill all of its contractual
  104  obligations to insured persons, subject to any restrictions in
  105  the written agreement pertaining to between the insurer and the
  106  administrator on the proprietary rights of the parties in such
  107  books and records.
  108         Section 6. Subsections (1) and (2) of section 626.89,
  109  Florida Statutes, are amended to read:
  110         626.89 Annual financial statement and filing fee; notice of
  111  change of ownership.—
  112         (1) Each authorized administrator shall annually file with
  113  the office a full and true statement of its financial condition,
  114  transactions, and affairs within 3 months after the end of the
  115  administrator’s fiscal year. The statement shall be filed
  116  annually on or before March 1 or within such extension of time
  117  therefor as the office for good cause may have granted. The
  118  statement must and shall be for the preceding fiscal calendar
  119  year and must. The statement shall be in such form and contain
  120  such matters as the commission prescribes and must shall be
  121  verified by at least two officers of the such administrator. An
  122  administrator whose sole stockholder is an association
  123  representing health care providers which is not an affiliate of
  124  an insurer, an administrator of a pooled governmental self
  125  insurance program, or an administrator that is a university may
  126  submit the preceding fiscal year’s statement within 2 months
  127  after its fiscal year end.
  128         (2) Each authorized administrator shall also file an
  129  audited financial statement performed by an independent
  130  certified public accountant. The audited financial statement
  131  shall be filed with the office within 5 months after the end of
  132  the administrator’s fiscal year and be on or before June 1 for
  133  the preceding fiscal calendar year ending December 31. An
  134  administrator whose sole stockholder is an association
  135  representing health care providers which is not an affiliate of
  136  an insurer, an administrator of a pooled governmental self
  137  insurance program, or an administrator that is a university may
  138  submit the preceding fiscal year’s audited financial statement
  139  within 5 months after the end of its fiscal year. An audited
  140  financial statement prepared on a consolidated basis must
  141  include a columnar consolidating or combining worksheet that
  142  must be filed with the statement and must comply with the
  143  following:
  144         (a) Amounts shown on the consolidated audited financial
  145  statement must be shown on the worksheet;
  146         (b) Amounts for each entity must be stated separately; and
  147         (c) Explanations of consolidating and eliminating entries
  148  must be included.
  150  ================= T I T L E  A M E N D M E N T ================
  151  And the title is amended as follows:
  152         Delete line 2
  153  and insert:
  154         An act relating to insurance; amending s. 626.8805,
  155         F.S.; revising insurance administrator application
  156         requirements; amending s. 626.8817, F.S.; authorizing
  157         an insurer’s designee to provide certain coverage
  158         information to an insurance administrator; authorizing
  159         an insurer to contract a third party to conduct a
  160         review of the operations of an insurance administrator
  161         under certain circumstances; amending s. 626.882,
  162         F.S.; prohibiting a person from acting as an insurance
  163         administrator without a specific written agreement;
  164         amending s. 626.883, F.S.; requiring an insurance
  165         administrator to furnish fiduciary account records to
  166         an insurer or its designee; requiring administrator
  167         withdrawals from a fiduciary account to be made
  168         according to a specific written agreement; providing
  169         that an insurer’s designee may authorize payment of
  170         claims; amending s. 626.884, F.S.; revising an
  171         insurer’s right of access to certain administrator
  172         records; amending s. 626.89, F.S.; revising the
  173         deadline for filing certain financial statements;