Florida Senate - 2015 PROPOSED COMMITTEE SUBSTITUTE
Bill No. CS for SB 258
Ì610218ÅÎ610218
576-01923-15
Proposed Committee Substitute by the Committee on Appropriations
(Appropriations Subcommittee on General Government)
1 A bill to be entitled
2 An act relating to property and casualty insurance;
3 amending s. 627.0628, F.S.; increasing the length of
4 time during which an insurer is not required to adhere
5 to certain models found by the Commission on Hurricane
6 Loss Projection Methodology to be accurate or reliable
7 in determining probable maximum loss levels with
8 respect to certain rate filings; amending s. 627.0651,
9 F.S.; revising provisions for the making and use of
10 rates for motor vehicle insurance; amending s.
11 627.3518, F.S.; conforming a cross-reference; amending
12 s. 627.4133, F.S.; increasing the amount of prior
13 notice required with respect to the nonrenewal,
14 cancellation, or termination of certain insurance
15 policies; deleting certain provisions that require
16 extended periods of prior notice with respect to the
17 nonrenewal, cancellation, or termination of certain
18 insurance policies; prohibiting the cancellation of
19 certain policies that have been in effect for a
20 specified amount of time except under certain
21 circumstances; amending s. 627.4137, F.S.; adding
22 licensed company adjusters to the list of persons who
23 may respond to a claimant’s written request for
24 information relating to liability insurance coverage;
25 amending s. 627.421, F.S.; authorizing a policyholder
26 of personal lines insurance to affirmatively elect
27 delivery of policy documents by electronic means;
28 amending s. 627.7074, F.S.; revising notification
29 requirements for participation in the neutral
30 evaluation program; amending s. 627.736, F.S.;
31 revising the applicability of certain Medicare fee
32 schedules or payment limitations; defining the term
33 “service year”; amending s. 627.744, F.S.; revising
34 the preinsurance inspection requirements for private
35 passenger motor vehicles; repealing s. 631.65, F.S.,
36 relating to prohibited advertisement or solicitation;
37 providing an effective date.
38
39 Be It Enacted by the Legislature of the State of Florida:
40
41
42 Section 1. Paragraph (d) of subsection (3) of section
43 627.0628, Florida Statutes, is amended to read:
44 627.0628 Florida Commission on Hurricane Loss Projection
45 Methodology; public records exemption; public meetings
46 exemption.—
47 (3) ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES.—
48 (d) With respect to a rate filing under s. 627.062, an
49 insurer shall employ and may not modify or adjust actuarial
50 methods, principles, standards, models, or output ranges found
51 by the commission to be accurate or reliable in determining
52 hurricane loss factors for use in a rate filing under s.
53 627.062. An insurer shall employ and may not modify or adjust
54 models found by the commission to be accurate or reliable in
55 determining probable maximum loss levels pursuant to paragraph
56 (b) with respect to a rate filing under s. 627.062 made more
57 than 180 60 days after the commission has made such findings.
58 This paragraph does not prohibit an insurer from using a
59 straight average of model results or output ranges for the
60 purposes of a rate filing for personal lines residential flood
61 insurance coverage under s. 627.062.
62 Section 2. Subsection (8) of section 627.0651, Florida
63 Statutes, is amended to read:
64 627.0651 Making and use of rates for motor vehicle
65 insurance.—
66 (8) Rates are not unfairly discriminatory if averaged
67 broadly among members of a group; nor are rates unfairly
68 discriminatory even though they are lower than rates for
69 nonmembers of the group. However, such rates are unfairly
70 discriminatory if they are not actuarially measurable and
71 credible and sufficiently related to actual or expected loss and
72 expense experience of the group so as to ensure assure that
73 nonmembers of the group are not unfairly discriminated against.
74 Use of a single United States Postal Service zip code as a
75 rating territory shall be deemed unfairly discriminatory unless
76 filed pursuant to paragraph (1)(a) and such territory
77 incorporates sufficient actual or expected loss and loss
78 adjustment expense experience so as to be actuarially measurable
79 and credible.
80 Section 3. Subsection (9) of section 627.3518, Florida
81 Statutes, is amended to read:
82 627.3518 Citizens Property Insurance Corporation
83 policyholder eligibility clearinghouse program.—The purpose of
84 this section is to provide a framework for the corporation to
85 implement a clearinghouse program by January 1, 2014.
86 (9) The 45-day notice of nonrenewal requirement set forth
87 in s. 627.4133(2)(b)5. s. 627.4133(2)(b)5.b. applies when a
88 policy is nonrenewed by the corporation because the risk has
89 received an offer of coverage pursuant to this section which
90 renders the risk ineligible for coverage by the corporation.
91 Section 4. Paragraph (b) of subsection (2) of section
92 627.4133, Florida Statutes, is amended to read:
93 627.4133 Notice of cancellation, nonrenewal, or renewal
94 premium.—
95 (2) With respect to any personal lines or commercial
96 residential property insurance policy, including, but not
97 limited to, any homeowner, mobile home owner, farmowner,
98 condominium association, condominium unit owner, apartment
99 building, or other policy covering a residential structure or
100 its contents:
101 (b) The insurer shall give the first-named insured written
102 notice of nonrenewal, cancellation, or termination at least 120
103 100 days before the effective date of the nonrenewal,
104 cancellation, or termination. However, the insurer shall give at
105 least 100 days’ written notice, or written notice by June 1,
106 whichever is earlier, for any nonrenewal, cancellation, or
107 termination that would be effective between June 1 and November
108 30. The notice must include the reason for the nonrenewal,
109 cancellation, or termination, except that:
110 1. The insurer shall give the first-named insured written
111 notice of nonrenewal, cancellation, or termination at least 120
112 days before the effective date of the nonrenewal, cancellation,
113 or termination for a first-named insured whose residential
114 structure has been insured by that insurer or an affiliated
115 insurer for at least 5 years before the date of the written
116 notice.
117 1.2. If cancellation is for nonpayment of premium, at least
118 10 days’ written notice of cancellation accompanied by the
119 reason therefor must be given. As used in this subparagraph, the
120 term “nonpayment of premium” means failure of the named insured
121 to discharge when due her or his obligations for paying the
122 premium on a policy or an installment of such premium, whether
123 the premium is payable directly to the insurer or its agent or
124 indirectly under a premium finance plan or extension of credit,
125 or failure to maintain membership in an organization if such
126 membership is a condition precedent to insurance coverage. The
127 term also means the failure of a financial institution to honor
128 an insurance applicant’s check after delivery to a licensed
129 agent for payment of a premium even if the agent has previously
130 delivered or transferred the premium to the insurer. If a
131 dishonored check represents the initial premium payment, the
132 contract and all contractual obligations are void ab initio
133 unless the nonpayment is cured within the earlier of 5 days
134 after actual notice by certified mail is received by the
135 applicant or 15 days after notice is sent to the applicant by
136 certified mail or registered mail. If the contract is void, any
137 premium received by the insurer from a third party must be
138 refunded to that party in full.
139 2.3. If cancellation or termination occurs during the first
140 90 days the insurance is in force and the insurance is canceled
141 or terminated for reasons other than nonpayment of premium, at
142 least 20 days’ written notice of cancellation or termination
143 accompanied by the reason therefor must be given unless there
144 has been a material misstatement or misrepresentation or a
145 failure to comply with the underwriting requirements established
146 by the insurer.
147 3. After the policy has been in effect for 90 days, the
148 policy may not be canceled by the insurer unless there has been
149 a material misstatement, a nonpayment of premium, a failure to
150 comply, within 90 days after the date of effectuation of
151 coverage, with the underwriting requirements established by the
152 insurer before the effectuation of coverage, or a substantial
153 change in the risk covered by the policy or unless the
154 cancellation is for all insureds under such policies for a given
155 class of insureds. This subparagraph does not apply to
156 individually rated risks that have a policy term of less than 90
157 days.
158 4. After a policy or contract has been in effect for more
159 than 90 days, the insurer may not cancel or terminate the policy
160 or contract based on credit information available in public
161 records.
162 5. The requirement for providing written notice by June 1
163 of any nonrenewal that would be effective between June 1 and
164 November 30 does not apply to the following situations, but the
165 insurer remains subject to the requirement to provide such
166 notice at least 100 days before the effective date of
167 nonrenewal:
168 a. A policy that is nonrenewed due to a revision in the
169 coverage for sinkhole losses and catastrophic ground cover
170 collapse pursuant to s. 627.706.
171 5.b. A policy that is nonrenewed by Citizens Property
172 Insurance Corporation, pursuant to s. 627.351(6), for a policy
173 that has been assumed by an authorized insurer offering
174 replacement coverage to the policyholder is exempt from the
175 notice requirements of paragraph (a) and this paragraph. In such
176 cases, the corporation must give the named insured written
177 notice of nonrenewal at least 45 days before the effective date
178 of the nonrenewal.
179
180 After the policy has been in effect for 90 days, the policy may
181 not be canceled by the insurer unless there has been a material
182 misstatement, a nonpayment of premium, a failure to comply with
183 underwriting requirements established by the insurer within 90
184 days after the date of effectuation of coverage, a substantial
185 change in the risk covered by the policy, or the cancellation is
186 for all insureds under such policies for a given class of
187 insureds. This paragraph does not apply to individually rated
188 risks that have a policy term of less than 90 days.
189 6. Notwithstanding any other provision of law, an insurer
190 may cancel or nonrenew a property insurance policy after at
191 least 45 days’ notice if the office finds that the early
192 cancellation of some or all of the insurer’s policies is
193 necessary to protect the best interests of the public or
194 policyholders and the office approves the insurer’s plan for
195 early cancellation or nonrenewal of some or all of its policies.
196 The office may base such finding upon the financial condition of
197 the insurer, lack of adequate reinsurance coverage for hurricane
198 risk, or other relevant factors. The office may condition its
199 finding on the consent of the insurer to be placed under
200 administrative supervision pursuant to s. 624.81 or to the
201 appointment of a receiver under chapter 631.
202 7. A policy covering both a home and a motor vehicle may be
203 nonrenewed for any reason applicable to the property or motor
204 vehicle insurance after providing 90 days’ notice.
205 Section 5. Subsection (1) of section 627.4137, Florida
206 Statutes, is amended to read:
207 627.4137 Disclosure of certain information required.—
208 (1) Each insurer that provides which does or may provide
209 liability insurance coverage to pay all or a portion of a any
210 claim that which might be made shall provide, within 30 days
211 after of the written request of the claimant, a statement, under
212 oath, of a corporate officer or the insurer’s claims manager, or
213 superintendent, or licensed company adjuster setting forth the
214 following information with regard to each known policy of
215 insurance, including excess or umbrella insurance:
216 (a) The name of the insurer.
217 (b) The name of each insured.
218 (c) The limits of the liability coverage.
219 (d) A statement of any policy or coverage defense that the
220 which such insurer reasonably believes is available to the such
221 insurer at the time of filing such statement.
222 (e) A copy of the policy.
223
224 In addition, the insured, or her or his insurance agent,
225 upon written request of the claimant or the claimant’s attorney,
226 shall disclose the name and coverage of each known insurer to
227 the claimant and shall forward such request for information as
228 required by this subsection to all affected insurers. The
229 insurer shall then supply the information required in this
230 subsection to the claimant within 30 days after of receipt of
231 such request.
232 Section 6. Subsection (1) of section 627.421, Florida
233 Statutes, is amended to read:
234 627.421 Delivery of policy.—
235 (1) Subject to the insurer’s requirement as to payment of
236 premium, every policy shall be mailed, delivered, or
237 electronically transmitted to the insured or to the person
238 entitled thereto not later than 60 days after the effectuation
239 of coverage. Notwithstanding any other provision of law, an
240 insurer may allow a policyholder of personal lines insurance to
241 affirmatively elect delivery of the policy documents, including,
242 but not limited to, policies, endorsements, notices, or
243 documents, by electronic means in lieu of delivery by mail.
244 Electronic transmission of a policy for commercial risks,
245 including, but not limited to, workers’ compensation and
246 employers’ liability, commercial automobile liability,
247 commercial automobile physical damage, commercial lines
248 residential property, commercial nonresidential property,
249 farmowners insurance, and the types of commercial lines risks
250 set forth in s. 627.062(3)(d), constitutes shall constitute
251 delivery to the insured or to the person entitled to delivery,
252 unless the insured or the person entitled to delivery
253 communicates to the insurer in writing or electronically that he
254 or she does not agree to delivery by electronic means.
255 Electronic transmission shall include a notice to the insured or
256 to the person entitled to delivery of a policy of his or her
257 right to receive the policy via United States mail rather than
258 via electronic transmission. A paper copy of the policy shall be
259 provided to the insured or to the person entitled to delivery at
260 his or her request.
261 Section 7. Subsection (3) of section 627.7074, Florida
262 Statutes, is amended to read:
263 627.7074 Alternative procedure for resolution of disputed
264 sinkhole insurance claims.—
265 (3) Following the receipt of the report provided under s.
266 627.7073 or the denial of a claim for a sinkhole loss, the
267 insurer shall notify the policyholder of his or her right to
268 participate in the neutral evaluation program under this section
269 if there is coverage available under the policy and the claim
270 was submitted within the timeframe provided in s. 627.706(5).
271 Neutral evaluation supersedes the alternative dispute resolution
272 process under s. 627.7015 but does not invalidate the appraisal
273 clause of the insurance policy. The insurer shall provide to the
274 policyholder the consumer information pamphlet prepared by the
275 department pursuant to subsection (1) electronically or by
276 United States mail.
277 Section 8. Paragraph (a) of subsection (5) of section
278 627.736, Florida Statutes, is amended to read:
279 627.736 Required personal injury protection benefits;
280 exclusions; priority; claims.—
281 (5) CHARGES FOR TREATMENT OF INJURED PERSONS.—
282 (a) A physician, hospital, clinic, or other person or
283 institution lawfully rendering treatment to an injured person
284 for a bodily injury covered by personal injury protection
285 insurance may charge the insurer and injured party only a
286 reasonable amount pursuant to this section for the services and
287 supplies rendered, and the insurer providing such coverage may
288 pay for such charges directly to such person or institution
289 lawfully rendering such treatment if the insured receiving such
290 treatment or his or her guardian has countersigned the properly
291 completed invoice, bill, or claim form approved by the office
292 upon which such charges are to be paid for as having actually
293 been rendered, to the best knowledge of the insured or his or
294 her guardian. However, such a charge may not exceed the amount
295 the person or institution customarily charges for like services
296 or supplies. In determining whether a charge for a particular
297 service, treatment, or otherwise is reasonable, consideration
298 may be given to evidence of usual and customary charges and
299 payments accepted by the provider involved in the dispute,
300 reimbursement levels in the community and various federal and
301 state medical fee schedules applicable to motor vehicle and
302 other insurance coverages, and other information relevant to the
303 reasonableness of the reimbursement for the service, treatment,
304 or supply.
305 1. The insurer may limit reimbursement to 80 percent of the
306 following schedule of maximum charges:
307 a. For emergency transport and treatment by providers
308 licensed under chapter 401, 200 percent of Medicare.
309 b. For emergency services and care provided by a hospital
310 licensed under chapter 395, 75 percent of the hospital’s usual
311 and customary charges.
312 c. For emergency services and care as defined by s. 395.002
313 provided in a facility licensed under chapter 395 rendered by a
314 physician or dentist, and related hospital inpatient services
315 rendered by a physician or dentist, the usual and customary
316 charges in the community.
317 d. For hospital inpatient services, other than emergency
318 services and care, 200 percent of the Medicare Part A
319 prospective payment applicable to the specific hospital
320 providing the inpatient services.
321 e. For hospital outpatient services, other than emergency
322 services and care, 200 percent of the Medicare Part A Ambulatory
323 Payment Classification for the specific hospital providing the
324 outpatient services.
325 f. For all other medical services, supplies, and care, 200
326 percent of the allowable amount under:
327 (I) The participating physicians fee schedule of Medicare
328 Part B, except as provided in sub-sub-subparagraphs (II) and
329 (III).
330 (II) Medicare Part B, in the case of services, supplies,
331 and care provided by ambulatory surgical centers and clinical
332 laboratories.
333 (III) The Durable Medical Equipment Prosthetics/Orthotics
334 and Supplies fee schedule of Medicare Part B, in the case of
335 durable medical equipment.
336
337 However, if such services, supplies, or care is not reimbursable
338 under Medicare Part B, as provided in this sub-subparagraph, the
339 insurer may limit reimbursement to 80 percent of the maximum
340 reimbursable allowance under workers’ compensation, as
341 determined under s. 440.13 and rules adopted thereunder which
342 are in effect at the time such services, supplies, or care is
343 provided. Services, supplies, or care that is not reimbursable
344 under Medicare or workers’ compensation is not required to be
345 reimbursed by the insurer.
346 2. For purposes of subparagraph 1., the applicable fee
347 schedule or payment limitation under Medicare is the fee
348 schedule or payment limitation in effect on March 1 of the
349 service year in which the services, supplies, or care is
350 rendered and for the area in which such services, supplies, or
351 care is rendered, and the applicable fee schedule or payment
352 limitation applies to services, supplies, or care rendered
353 during throughout the remainder of that service year,
354 notwithstanding any subsequent change made to the fee schedule
355 or payment limitation, except that it may not be less than the
356 allowable amount under the applicable schedule of Medicare Part
357 B for 2007 for medical services, supplies, and care subject to
358 Medicare Part B. As used in this subparagraph, the term “service
359 year” means the period from March 1 through the last day of
360 February of the following year.
361 3. Subparagraph 1. does not allow the insurer to apply any
362 limitation on the number of treatments or other utilization
363 limits that apply under Medicare or workers’ compensation. An
364 insurer that applies the allowable payment limitations of
365 subparagraph 1. must reimburse a provider who lawfully provided
366 care or treatment under the scope of his or her license,
367 regardless of whether such provider is entitled to reimbursement
368 under Medicare due to restrictions or limitations on the types
369 or discipline of health care providers who may be reimbursed for
370 particular procedures or procedure codes. However, subparagraph
371 1. does not prohibit an insurer from using the Medicare coding
372 policies and payment methodologies of the federal Centers for
373 Medicare and Medicaid Services, including applicable modifiers,
374 to determine the appropriate amount of reimbursement for medical
375 services, supplies, or care if the coding policy or payment
376 methodology does not constitute a utilization limit.
377 4. If an insurer limits payment as authorized by
378 subparagraph 1., the person providing such services, supplies,
379 or care may not bill or attempt to collect from the insured any
380 amount in excess of such limits, except for amounts that are not
381 covered by the insured’s personal injury protection coverage due
382 to the coinsurance amount or maximum policy limits.
383 5. Effective July 1, 2012, An insurer may limit payment as
384 authorized by this paragraph only if the insurance policy
385 includes a notice at the time of issuance or renewal that the
386 insurer may limit payment pursuant to the schedule of charges
387 specified in this paragraph. A policy form approved by the
388 office satisfies this requirement. If a provider submits a
389 charge for an amount less than the amount allowed under
390 subparagraph 1., the insurer may pay the amount of the charge
391 submitted.
392 Section 9. Paragraphs (a) and (b) of subsection (2) of
393 section 627.744, Florida Statutes, are amended to read:
394 627.744 Required preinsurance inspection of private
395 passenger motor vehicles.—
396 (2) This section does not apply:
397 (a) To a policy for a policyholder who has been insured for
398 2 years or longer, without interruption, under a private
399 passenger motor vehicle policy that which provides physical
400 damage coverage for any vehicle, if the agent of the insurer
401 verifies the previous coverage.
402 (b) To a new, unused motor vehicle purchased or leased from
403 a licensed motor vehicle dealer or leasing company., if The
404 insurer may require is provided with:
405 1. A bill of sale, or buyer’s order, or lease agreement
406 that which contains a full description of the motor vehicle,
407 including all options and accessories; or
408 2. A copy of the title or registration that which
409 establishes transfer of ownership from the dealer or leasing
410 company to the customer and a copy of the window sticker or the
411 dealer invoice showing the itemized options and equipment and
412 the total retail price of the vehicle.
413
414 For the purposes of this paragraph, the physical damage coverage
415 on the motor vehicle may not be suspended during the term of the
416 policy due to the applicant’s failure to provide or the
417 insurer’s option not to require the required documents. However,
418 if the insurer requires a document under this paragraph at the
419 time the policy is issued, payment of a claim may be is
420 conditioned upon the receipt by the insurer of the required
421 documents, and no physical damage loss occurring after the
422 effective date of the coverage may be is payable until the
423 documents are provided to the insurer.
424 Section 10. Section 631.65, Florida Statutes, is repealed.
425 Section 11. This act shall take effect July 1, 2015.