Florida Senate - 2020                        COMMITTEE AMENDMENT
       Bill No. SB 1334
                              LEGISLATIVE ACTION                        
                    Senate             .             House              

       The Committee on Banking and Insurance (Rouson) recommended the
    1         Senate Amendment to Amendment (632742) (with directory and
    2  title amendments)
    4         Between lines 53 and 54
    5  insert:
    6         (5) REIMBURSEMENT PREMIUMS.—
    7         (b) The State Board of Administration shall select an
    8  independent consultant to develop a rate formula for determining
    9  the actuarially indicated premium to be paid to the fund. The
   10  rate formula must shall specify, for each zip code or other
   11  limited geographical area, the amount of premium to be paid by
   12  an insurer for each $1,000 of insured value under covered
   13  policies in that zip code or other area. In establishing
   14  premiums, the board shall consider the coverage elected under
   15  paragraph (4)(b) and any factors that tend to enhance the
   16  actuarial sophistication of ratemaking for the fund, including
   17  deductibles, type of construction, type of coverage provided,
   18  relative concentration of risks, and other such factors deemed
   19  by the board to be appropriate. For the 2020-2021, 2021-2022,
   20  and 2022-2023 contract years, the rapid cash build-up factor
   21  shall be suspended. Thereafter, the fund’s rate formula may
   22  provide for a rapid cash build-up factor of up to 25 percent
   23  only when the available cash balance as of December 31 of the
   24  previous year is less than 50 percent of the statutory capacity.
   25  For the purpose of calculating the rapid cash build-up factor
   26  trigger, the available cash balance must not be reduced by more
   27  than 50 percent of the estimated reserves for participating
   28  insurer’s reimbursements The formula must provide for a cash
   29  build-up factor. For the 2009-2010 contract year, the factor is
   30  5 percent. For the 2010-2011 contract year, the factor is 10
   31  percent. For the 2011-2012 contract year, the factor is 15
   32  percent. For the 2012-2013 contract year, the factor is 20
   33  percent. For the 2013-2014 contract year and thereafter, the
   34  factor is 25 percent. The rate formula may provide for a
   35  procedure to determine the premiums to be paid by new insurers
   36  that begin writing covered policies after the beginning of a
   37  contract year, taking into consideration when the insurer starts
   38  writing covered policies, the potential exposure of the insurer,
   39  the potential exposure of the fund, the administrative costs to
   40  the insurer and to the fund, and any other factors deemed
   41  appropriate by the board. The formula must be approved by
   42  unanimous vote of the board. The board may, at any time, revise
   43  the formula pursuant to the procedure provided in this
   44  paragraph.
   46  ====== D I R E C T O R Y  C L A U S E  A M E N D M E N T ======
   47  And the directory clause is amended as follows:
   48         Delete lines 5 - 6
   49  and insert:
   50         Section 1. Paragraph (c) of subsection (2) and paragraph
   51  (b) of subsection (5) of section 215.555, Florida Statutes, are
   52  amended to read:
   54  ================= T I T L E  A M E N D M E N T ================
   55  And the title is amended as follows:
   56         Delete line 1268
   57  and insert:
   58         policies; requiring the suspension of the rapid cash
   59         build-up factor in the fund’s rate formula during
   60         specified contract years; providing that, after the
   61         suspension, the rate formula may provide for a cash
   62         build-up factor of up to a specified percentage only
   63         under certain circumstances; specifying a limitation
   64         on calculating the trigger for the cash build-up
   65         factor; amending s. 319.30, F.S.; revising a certain