Florida Senate - 2016                                    SB 1036
       By Senator Brandes
       22-00805D-16                                          20161036__
    1                        A bill to be entitled                      
    2         An act relating to automobile insurance; amending s.
    3         627.311, F.S.; authorizing the Florida Automobile
    4         Joint Underwriting Association and a joint
    5         underwriting plan approved by the Office of Insurance
    6         Regulation to cancel personal lines or commercial
    7         policies within a specified time for nonpayment of
    8         premium due to certain reasons; prohibiting an insured
    9         from cancelling a policy or binder within a specified
   10         time except under certain conditions; amending s.
   11         627.7283, F.S.; authorizing an insured who cancels a
   12         policy to apply the unearned portion of any premium
   13         paid to unpaid balances of other policies with the
   14         same insurer or insurer group; amending s. 627.7295,
   15         F.S.; updating applicability language to include a
   16         reference to recurring credit card or debit card
   17         payments; amending s. 627.736, F.S.; requiring that a
   18         certain standard form be approved by the office and
   19         adopted by the Financial Services Commission, rather
   20         than approved by the office or adopted by the
   21         commission; revising standards for compliance for
   22         specified billings for medical services; amending s.
   23         627.739, F.S.; revising applicability; providing a
   24         limitation to an amount of expenses and losses
   25         applicable to a deductible related to personal injury
   26         protection benefits under a certain condition;
   27         amending s. 627.744, F.S.; authorizing an insurer to
   28         opt out of the preinsurance inspection of private
   29         passenger motor vehicles and to establish its own
   30         preinsurance inspection program if it files a certain
   31         manual rule with the office; providing an effective
   32         date.
   34  Be It Enacted by the Legislature of the State of Florida:
   36         Section 1. Paragraph (m) is added to subsection (3) of
   37  section 627.311, Florida Statutes, to read:
   38         627.311 Joint underwriters and joint reinsurers; public
   39  records and public meetings exemptions.—
   40         (3) The office may, after consultation with insurers
   41  licensed to write automobile insurance in this state, approve a
   42  joint underwriting plan for purposes of equitable apportionment
   43  or sharing among insurers of automobile liability insurance and
   44  other motor vehicle insurance, as an alternate to the plan
   45  required in s. 627.351(1). All insurers authorized to write
   46  automobile insurance in this state shall subscribe to the plan
   47  and participate therein. The plan shall be subject to continuous
   48  review by the office which may at any time disapprove the entire
   49  plan or any part thereof if it determines that conditions have
   50  changed since prior approval and that in view of the purposes of
   51  the plan changes are warranted. Any disapproval by the office
   52  shall be subject to the provisions of chapter 120. The Florida
   53  Automobile Joint Underwriting Association is created under the
   54  plan. The plan and the association:
   55         (m) May cancel personal lines or commercial policies issued
   56  by the plan within the first 60 days after the effective date of
   57  the policy or binder for nonpayment of premium if the check
   58  issued for payment of the premium is dishonored for any reason
   59  or if any other form of payment is rejected or deemed invalid.
   60  An insured may not cancel a policy or binder within the first 90
   61  days after its effective date, or within a lesser period as
   62  required by the plan, except:
   63         1. Upon total destruction of the insured motor vehicle;
   64         2. Upon transfer of ownership of the insured motor vehicle;
   65  or
   66         3. After purchase of another policy or binder covering the
   67  motor vehicle that was covered under the policy being canceled.
   68         Section 2. Section 627.7283, Florida Statutes, is amended
   69  to read:
   70         627.7283 Cancellation; return of unearned premium.—
   71         (1) If the insured cancels a policy of motor vehicle
   72  insurance, the insurer must mail or electronically transfer the
   73  unearned portion of any premium paid within 30 days after the
   74  effective date of the policy cancellation or receipt of notice
   75  or request for cancellation, whichever is later. This
   76  requirement applies to a cancellation initiated by an insured
   77  for any reason. However, the insured may apply the unearned
   78  portion of any premium paid to unpaid balances of other policies
   79  with the same insurer or insurer group.
   80         (2) If an insurer cancels a policy of motor vehicle
   81  insurance, the insurer must mail or electronically transfer the
   82  unearned premium portion of any premium within 15 days after the
   83  effective date of the policy cancellation. However, the insured
   84  may apply the unearned portion of any premium paid to unpaid
   85  balances of other policies with the same insurer or insurer
   86  group.
   87         (3) If the unearned premium is not mailed, or
   88  electronically transferred, or applied to the unpaid balance of
   89  other policies within the applicable period, the insurer must
   90  pay to the insured 8 percent interest on the amount due. If the
   91  unearned premium is not mailed or electronically transferred
   92  within 45 days after the applicable period, the insured may
   93  bring an action against the insurer pursuant to s. 624.155.
   94         (4) If the insured cancels, the insurer may retain up to 10
   95  percent of the unearned premium and must refund at least 90
   96  percent of the unearned premium. If the insurer cancels, the
   97  insurer must refund 100 percent of the unearned premium.
   98  Cancellation is without prejudice to any claim originating prior
   99  to the effective date of the cancellation. For purposes of this
  100  section, unearned premiums must be computed on a pro rata basis.
  101         (5) The insurer must refund 100 percent of the unearned
  102  premium if the insured is a servicemember, as defined in s.
  103  250.01, who cancels because he or she is called to active duty
  104  or transferred by the United States Armed Forces to a location
  105  where the insurance is not required. The insurer may require a
  106  servicemember to submit either a copy of the official military
  107  orders or a written verification signed by the servicemember’s
  108  commanding officer to support the refund authorized under this
  109  subsection. If the insurer cancels, the insurer must refund 100
  110  percent of the unearned premium. Cancellation is without
  111  prejudice to any claim originating prior to the effective date
  112  of the cancellation. For purposes of this section, unearned
  113  premiums must be computed on a pro rata basis.
  114         Section 3. Subsection (7) of section 627.7295, Florida
  115  Statutes, is amended to read:
  116         627.7295 Motor vehicle insurance contracts.—
  117         (7) A policy of private passenger motor vehicle insurance
  118  or a binder for such a policy may be initially issued in this
  119  state only if, before the effective date of such binder or
  120  policy, the insurer or agent has collected from the insured an
  121  amount equal to 2 months’ premium. An insurer, agent, or premium
  122  finance company may not, directly or indirectly, take any action
  123  resulting in the insured having paid from the insured’s own
  124  funds an amount less than the 2 months’ premium required by this
  125  subsection. This subsection applies without regard to whether
  126  the premium is financed by a premium finance company or is paid
  127  pursuant to a periodic payment plan of an insurer or an
  128  insurance agent. This subsection does not apply if an insured or
  129  member of the insured’s family is renewing or replacing a policy
  130  or a binder for such policy written by the same insurer or a
  131  member of the same insurer group. This subsection does not apply
  132  to an insurer that issues private passenger motor vehicle
  133  coverage primarily to active duty or former military personnel
  134  or their dependents. This subsection does not apply if all
  135  policy payments are paid pursuant to a payroll deduction plan,
  136  or an automatic electronic funds transfer payment plan from the
  137  policyholder, or a recurring credit card or debit card agreement
  138  with the insurer. This subsection and subsection (4) do not
  139  apply if all policy payments to an insurer are paid pursuant to
  140  an automatic electronic funds transfer payment plan from an
  141  agent, a managing general agent, or a premium finance company
  142  and if the policy includes, at a minimum, personal injury
  143  protection pursuant to ss. 627.730-627.7405; motor vehicle
  144  property damage liability pursuant to s. 627.7275; and bodily
  145  injury liability in at least the amount of $10,000 because of
  146  bodily injury to, or death of, one person in any one accident
  147  and in the amount of $20,000 because of bodily injury to, or
  148  death of, two or more persons in any one accident. This
  149  subsection and subsection (4) do not apply if an insured has had
  150  a policy in effect for at least 6 months, the insured’s agent is
  151  terminated by the insurer that issued the policy, and the
  152  insured obtains coverage on the policy’s renewal date with a new
  153  company through the terminated agent.
  154         Section 4. Paragraph (d) of subsection (5) of section
  155  627.736, Florida Statutes, is amended to read:
  156         627.736 Required personal injury protection benefits;
  157  exclusions; priority; claims.—
  159         (d) All statements and bills for medical services rendered
  160  by a physician, hospital, clinic, or other person or institution
  161  shall be submitted to the insurer on a properly completed
  162  Centers for Medicare and Medicaid Services (CMS) 1500 form, UB
  163  92 forms, or any other standard form approved by the office and
  164  or adopted by the commission for purposes of this paragraph. All
  165  billings for such services rendered by providers must, to the
  166  extent applicable, comply with the CMS 1500 form instructions,
  167  the American Medical Association CPT Editorial Panel, and the
  168  Healthcare Common Procedure Coding System (HCPCS); and must
  169  follow the Physicians’ Current Procedural Terminology (CPT), the
  170  HCPCS in effect for the year in which services are rendered, and
  171  the International Classification of Diseases (ICD) adopted by
  172  the United States Department of Health and Human Services for
  173  the year in which services are rendered follow the Physicians’
  174  Current Procedural Terminology (CPT) or Healthcare Correct
  175  Procedural Coding System (HCPCS), or ICD-9 in effect for the
  176  year in which services are rendered and comply with the CMS 1500
  177  form instructions, the American Medical Association CPT
  178  Editorial Panel, and the HCPCS. All providers, other than
  179  hospitals, must include on the applicable claim form the
  180  professional license number of the provider in the line or space
  181  provided for “Signature of Physician or Supplier, Including
  182  Degrees or Credentials.” In determining compliance with
  183  applicable CPT and HCPCS coding, guidance shall be provided by
  184  the Physicians’ Current Procedural Terminology (CPT) or the
  185  Healthcare Correct Procedural Coding System (HCPCS) in effect
  186  for the year in which services were rendered, the Office of the
  187  Inspector General, Physicians Compliance Guidelines, and other
  188  authoritative treatises designated by rule by the Agency for
  189  Health Care Administration. A statement of medical services may
  190  not include charges for medical services of a person or entity
  191  that performed such services without possessing the valid
  192  licenses required to perform such services. For purposes of
  193  paragraph (4)(b), an insurer is not considered to have been
  194  furnished with notice of the amount of covered loss or medical
  195  bills due unless the statements or bills comply with this
  196  paragraph and are properly completed in their entirety as to all
  197  material provisions, with all relevant information being
  198  provided therein.
  199         Section 5. Subsection (2) of section 627.739, Florida
  200  Statutes, is amended to read:
  201         627.739 Personal injury protection; optional limitations;
  202  deductibles.—
  203         (2) Insurers shall offer to each applicant and to each
  204  policyholder, upon the renewal of an existing policy,
  205  deductibles, in amounts of $250, $500, and $1,000. The
  206  deductible amount must be applied to 100 percent of the expenses
  207  and losses covered under personal injury protection benefits
  208  coverage issued pursuant to described in s. 627.736. If an
  209  insurer has elected to apply the schedule of maximum charges
  210  authorized under this chapter, the amount of expenses and losses
  211  applicable to the deductible will be limited to 100 percent of
  212  such authorized reimbursement limitations or fee schedules.
  213  After the deductible is met, each insured is eligible to receive
  214  up to $10,000 in total benefits described in s. 627.736(1).
  215  However, this subsection shall not be applied to reduce the
  216  amount of any benefits received in accordance with s.
  217  627.736(1)(c).
  218         Section 6. Section 627.744, Florida Statutes, is amended to
  219  read:
  220         627.744 Required Preinsurance inspection of private
  221  passenger motor vehicles.—
  222         (1) A private passenger motor vehicle insurance policy
  223  providing physical damage coverage, including collision or
  224  comprehensive coverage, may not be issued in this state unless
  225  the insurer has inspected the motor vehicle in accordance with
  226  this section or has opted out of the inspection under this
  227  section. An insurer opting out of the inspection must file a
  228  manual rule with the office indicating that the insurer will not
  229  be participating in the inspection program under this section
  230  and will not require the preinsurance inspection of its
  231  insureds’ motor vehicles. An insurer that files such a manual
  232  rule with the office may establish its own preinsurance
  233  inspection program.
  234         (2) This section does not apply:
  235         (a) To a policy for a policyholder who has been insured for
  236  2 years or longer, without interruption, under a private
  237  passenger motor vehicle policy that provides physical damage
  238  coverage for any vehicle if the agent of the insurer verifies
  239  the previous coverage.
  240         (b) To a new, unused motor vehicle purchased or leased from
  241  a licensed motor vehicle dealer or leasing company. The insurer
  242  may require:
  243         1. A bill of sale, buyer’s order, or lease agreement that
  244  contains a full description of the motor vehicle; or
  245         2. A copy of the title or registration that establishes
  246  transfer of ownership from the dealer or leasing company to the
  247  customer and a copy of the window sticker.
  249  For the purposes of this paragraph, the physical damage coverage
  250  on the motor vehicle may not be suspended during the term of the
  251  policy due to the applicant’s failure to provide or the
  252  insurer’s option not to require the documents. However, if the
  253  insurer requires a document under this paragraph at the time the
  254  policy is issued, payment of a claim may be conditioned upon the
  255  receipt by the insurer of the required documents, and no
  256  physical damage loss occurring after the effective date of the
  257  coverage may be payable until the documents are provided to the
  258  insurer.
  259         (c) To a temporary substitute motor vehicle.
  260         (d) To a motor vehicle which is leased for less than 6
  261  months, if the insurer receives the lease or rental agreement
  262  containing a description of the leased motor vehicle, including
  263  its condition. Payment of a physical damage claim is conditioned
  264  upon receipt of the lease or rental agreement.
  265         (e) To a vehicle that is 10 years old or older, as
  266  determined by reference to the model year.
  267         (f) To any renewal policy.
  268         (g) To a motor vehicle policy issued in a county with a
  269  1988 estimated population of less than 500,000.
  270         (h) To any other vehicle or policy exempted by rule of the
  271  commission. The commission may base a rule under this paragraph
  272  only on a determination that the likelihood of a fraudulent
  273  physical damage claim is remote or that the inspection would
  274  cause a serious hardship to the insurer or the applicant.
  275         (i) When the insurer’s authorized inspection service has no
  276  inspection facility either in the municipality in which the
  277  automobile is principally garaged or within 10 miles of such
  278  municipality.
  279         (j) When the insured vehicle is insured under a
  280  commercially rated policy that insures five or more vehicles.
  281         (k) When an insurance producer is transferring a book of
  282  business from one insurer to another.
  283         (l) When an individual insured’s coverage is being
  284  transferred and initiated by a producer to a new insurer.
  285         (3) This subsection does not prohibit an insurer from
  286  requiring a preinsurance inspection of any motor vehicle as a
  287  condition of issuance of physical damage coverage.
  288         (4) The inspection required by this section shall be
  289  provided by the insurer or by a person or organization
  290  authorized by the insurer. The applicant may be required to pay
  291  the cost of the inspection, not to exceed $5. The inspection
  292  shall be recorded on a form prescribed by the commission, and
  293  the form or a copy shall be retained by the insurer with its
  294  policy records for the insured. The insurer shall provide a copy
  295  of the form to the insured upon request. Any inspection fee paid
  296  directly by the applicant may not be considered part of the
  297  premium. However, an insurer that provides the inspection at no
  298  cost to the applicant may include the expense of the inspection
  299  within a rate filing.
  300         (5) The inspection shall include at least the following:
  301         (a) Taking a physical imprint of the vehicle identification
  302  number of the vehicle or otherwise recording the vehicle
  303  identification number in a manner prescribed by the commission.
  304         (b) Recording the presence of accessories required by the
  305  commission to be recorded.
  306         (c) Recording the locations of and a description of
  307  existing damage to the vehicle.
  308         (6) An insurer may defer an inspection for 30 calendar days
  309  following the effective date of coverage for a new policy, but
  310  not for a renewal policy, and for additional or replacement
  311  vehicles to an existing policy, if an inspection at the time of
  312  the request for coverage would create a serious inconvenience
  313  for the applicant and such hardship is documented in the
  314  insured’s policy record.
  315         (7) The commission may, by rule, establish such procedures
  316  and notice requirements that it finds necessary to implement
  317  this section.
  318         Section 7. This act shall take effect July 1, 2016.