Florida Senate - 2022                          SENATOR AMENDMENT
       Bill No. SB 2-A
       
       
       
       
       
       
                                Ì786778mÎ786778                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
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                Floor: 7/F/2R          .                                
             12/13/2022 02:53 PM       .                                
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       Senator Torres moved the following:
       
       
    1         Senate Amendment 
    2  
    3         Delete lines 604 - 2813
    4  and insert:
    5  within 45 90 days after an insurer receives notice of a
    6  residential property insurance claim, determines the amounts of
    7  partial or full benefits, and agrees to coverage, unless payment
    8  of the undisputed benefits is prevented by factors beyond the
    9  control of the insurer as defined in s. 627.70131(5) an act of
   10  God, prevented by the impossibility of performance, or due to
   11  actions by the insured or claimant that constitute fraud, lack
   12  of cooperation, or intentional misrepresentation regarding the
   13  claim for which benefits are owed.
   14         Section 8. Effective January 1, 2023, paragraphs (b), (c),
   15  (n), (o), (p), (q), (v), (w), (aa), and (ii) of subsection (6)
   16  of section 627.351, Florida Statutes, are amended, and paragraph
   17  (kk) is added to that subsection, to read:
   18         627.351 Insurance risk apportionment plans.—
   19         (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
   20         (b)1. All insurers authorized to write one or more subject
   21  lines of business in this state are subject to assessment by the
   22  corporation and, for the purposes of this subsection, are
   23  referred to collectively as “assessable insurers.” Insurers
   24  writing one or more subject lines of business in this state
   25  pursuant to part VIII of chapter 626 are not assessable
   26  insurers; however, insureds who procure one or more subject
   27  lines of business in this state pursuant to part VIII of chapter
   28  626 are subject to assessment by the corporation and are
   29  referred to collectively as “assessable insureds.” An insurer’s
   30  assessment liability begins on the first day of the calendar
   31  year following the year in which the insurer was issued a
   32  certificate of authority to transact insurance for subject lines
   33  of business in this state and terminates 1 year after the end of
   34  the first calendar year during which the insurer no longer holds
   35  a certificate of authority to transact insurance for subject
   36  lines of business in this state.
   37         2.a. All revenues, assets, liabilities, losses, and
   38  expenses of the corporation shall be divided into three separate
   39  accounts as follows:
   40         (I) A personal lines account for personal residential
   41  policies issued by the corporation which provides comprehensive,
   42  multiperil coverage on risks that are not located in areas
   43  eligible for coverage by the Florida Windstorm Underwriting
   44  Association as those areas were defined on January 1, 2002, and
   45  for policies that do not provide coverage for the peril of wind
   46  on risks that are located in such areas;
   47         (II) A commercial lines account for commercial residential
   48  and commercial nonresidential policies issued by the corporation
   49  which provides coverage for basic property perils on risks that
   50  are not located in areas eligible for coverage by the Florida
   51  Windstorm Underwriting Association as those areas were defined
   52  on January 1, 2002, and for policies that do not provide
   53  coverage for the peril of wind on risks that are located in such
   54  areas; and
   55         (III) A coastal account for personal residential policies
   56  and commercial residential and commercial nonresidential
   57  property policies issued by the corporation which provides
   58  coverage for the peril of wind on risks that are located in
   59  areas eligible for coverage by the Florida Windstorm
   60  Underwriting Association as those areas were defined on January
   61  1, 2002. The corporation may offer policies that provide
   62  multiperil coverage and shall offer policies that provide
   63  coverage only for the peril of wind for risks located in areas
   64  eligible for coverage in the coastal account. Effective July 1,
   65  2014, the corporation shall cease offering new commercial
   66  residential policies providing multiperil coverage and shall
   67  instead continue to offer commercial residential wind-only
   68  policies, and may offer commercial residential policies
   69  excluding wind. The corporation may, however, continue to renew
   70  a commercial residential multiperil policy on a building that is
   71  insured by the corporation on June 30, 2014, under a multiperil
   72  policy. In issuing multiperil coverage, the corporation may use
   73  its approved policy forms and rates for the personal lines
   74  account. An applicant or insured who is eligible to purchase a
   75  multiperil policy from the corporation may purchase a multiperil
   76  policy from an authorized insurer without prejudice to the
   77  applicant’s or insured’s eligibility to prospectively purchase a
   78  policy that provides coverage only for the peril of wind from
   79  the corporation. An applicant or insured who is eligible for a
   80  corporation policy that provides coverage only for the peril of
   81  wind may elect to purchase or retain such policy and also
   82  purchase or retain coverage excluding wind from an authorized
   83  insurer without prejudice to the applicant’s or insured’s
   84  eligibility to prospectively purchase a policy that provides
   85  multiperil coverage from the corporation. It is the goal of the
   86  Legislature that there be an overall average savings of 10
   87  percent or more for a policyholder who currently has a wind-only
   88  policy with the corporation, and an ex-wind policy with a
   89  voluntary insurer or the corporation, and who obtains a
   90  multiperil policy from the corporation. It is the intent of the
   91  Legislature that the offer of multiperil coverage in the coastal
   92  account be made and implemented in a manner that does not
   93  adversely affect the tax-exempt status of the corporation or
   94  creditworthiness of or security for currently outstanding
   95  financing obligations or credit facilities of the coastal
   96  account, the personal lines account, or the commercial lines
   97  account. The coastal account must also include quota share
   98  primary insurance under subparagraph (c)2. The area eligible for
   99  coverage under the coastal account also includes the area within
  100  Port Canaveral, which is bordered on the south by the City of
  101  Cape Canaveral, bordered on the west by the Banana River, and
  102  bordered on the north by Federal Government property.
  103         b. The three separate accounts must be maintained as long
  104  as financing obligations entered into by the Florida Windstorm
  105  Underwriting Association or Residential Property and Casualty
  106  Joint Underwriting Association are outstanding, in accordance
  107  with the terms of the corresponding financing documents. If no
  108  such financing obligations remain outstanding or if the
  109  financing documents allow for combining of accounts, the
  110  corporation may consolidate the three separate accounts into a
  111  new account, to be known as the Citizens account, for all
  112  revenues, assets, liabilities, losses, and expenses of the
  113  corporation. The Citizens account, if established by the
  114  corporation, is authorized to provide coverage to the same
  115  extent as provided under each of the three separate accounts.
  116  The authority to provide coverage under the Citizens account is
  117  set forth in subparagraph 4. If the financing obligations are no
  118  longer outstanding, the corporation may use a single account for
  119  all revenues, assets, liabilities, losses, and expenses of the
  120  corporation. Consistent with this subparagraph and prudent
  121  investment policies that minimize the cost of carrying debt, the
  122  board shall exercise its best efforts to retire existing debt or
  123  obtain the approval of necessary parties to amend the terms of
  124  existing debt, so as to structure the most efficient plan for
  125  consolidating the three separate accounts into a single account.
  126  Once the accounts are combined into one account, this
  127  subparagraph and subparagraph 3. shall be replaced in their
  128  entirety by subparagraphs 4. and 5.
  129         c. Creditors of the Residential Property and Casualty Joint
  130  Underwriting Association and the accounts specified in sub-sub
  131  subparagraphs a.(I) and (II) may have a claim against, and
  132  recourse to, those accounts and no claim against, or recourse
  133  to, the account referred to in sub-sub-subparagraph a.(III).
  134  Creditors of the Florida Windstorm Underwriting Association have
  135  a claim against, and recourse to, the account referred to in
  136  sub-sub-subparagraph a.(III) and no claim against, or recourse
  137  to, the accounts referred to in sub-sub-subparagraphs a.(I) and
  138  (II).
  139         d. Revenues, assets, liabilities, losses, and expenses not
  140  attributable to particular accounts shall be prorated among the
  141  accounts.
  142         e. The Legislature finds that the revenues of the
  143  corporation are revenues that are necessary to meet the
  144  requirements set forth in documents authorizing the issuance of
  145  bonds under this subsection.
  146         f. The income of the corporation may not inure to the
  147  benefit of any private person.
  148         3. With respect to a deficit in an account:
  149         a. After accounting for the Citizens policyholder surcharge
  150  imposed under sub-subparagraph i., if the remaining projected
  151  deficit incurred in the coastal account in a particular calendar
  152  year:
  153         (I) Is not greater than 2 percent of the aggregate
  154  statewide direct written premium for the subject lines of
  155  business for the prior calendar year, the entire deficit shall
  156  be recovered through regular assessments of assessable insurers
  157  under paragraph (q) and assessable insureds.
  158         (II) Exceeds 2 percent of the aggregate statewide direct
  159  written premium for the subject lines of business for the prior
  160  calendar year, the corporation shall levy regular assessments on
  161  assessable insurers under paragraph (q) and on assessable
  162  insureds in an amount equal to the greater of 2 percent of the
  163  projected deficit or 2 percent of the aggregate statewide direct
  164  written premium for the subject lines of business for the prior
  165  calendar year. Any remaining projected deficit shall be
  166  recovered through emergency assessments under sub-subparagraph
  167  e. d.
  168         b. Each assessable insurer’s share of the amount being
  169  assessed under sub-subparagraph a. must be in the proportion
  170  that the assessable insurer’s direct written premium for the
  171  subject lines of business for the year preceding the assessment
  172  bears to the aggregate statewide direct written premium for the
  173  subject lines of business for that year. The assessment
  174  percentage applicable to each assessable insured is the ratio of
  175  the amount being assessed under sub-subparagraph a. to the
  176  aggregate statewide direct written premium for the subject lines
  177  of business for the prior year. Assessments levied by the
  178  corporation on assessable insurers under sub-subparagraph a.
  179  must be paid as required by the corporation’s plan of operation
  180  and paragraph (q). Assessments levied by the corporation on
  181  assessable insureds under sub-subparagraph a. shall be collected
  182  by the surplus lines agent at the time the surplus lines agent
  183  collects the surplus lines tax required by s. 626.932, and paid
  184  to the Florida Surplus Lines Service Office at the time the
  185  surplus lines agent pays the surplus lines tax to that office.
  186  Upon receipt of regular assessments from surplus lines agents,
  187  the Florida Surplus Lines Service Office shall transfer the
  188  assessments directly to the corporation as determined by the
  189  corporation.
  190         c. The corporation may not levy regular assessments under
  191  paragraph (q) pursuant to sub-subparagraph a. or sub
  192  subparagraph b. if the three separate accounts in sub-sub
  193  subparagraphs 2.a.(I)-(III) have been consolidated into the
  194  Citizens account pursuant to sub-subparagraph 2.b. However, the
  195  outstanding balance of any regular assessment levied by the
  196  corporation before establishment of the Citizens account remains
  197  payable to the corporation.
  198         d. After accounting for the Citizens policyholder surcharge
  199  imposed under sub-subparagraph j. i., the remaining projected
  200  deficits in the personal lines account and in the commercial
  201  lines account in a particular calendar year shall be recovered
  202  through emergency assessments under sub-subparagraph e. d.
  203         e.d. Upon a determination by the board of governors that a
  204  projected deficit in an account exceeds the amount that is
  205  expected to be recovered through regular assessments under sub
  206  subparagraph a., plus the amount that is expected to be
  207  recovered through surcharges under sub-subparagraph j. i., the
  208  board, after verification by the office, shall levy emergency
  209  assessments for as many years as necessary to cover the
  210  deficits, to be collected by assessable insurers and the
  211  corporation and collected from assessable insureds upon issuance
  212  or renewal of policies for subject lines of business, excluding
  213  National Flood Insurance policies. The amount collected in a
  214  particular year must be a uniform percentage of that year’s
  215  direct written premium for subject lines of business and all
  216  accounts of the corporation, excluding National Flood Insurance
  217  Program policy premiums, as annually determined by the board and
  218  verified by the office. The office shall verify the arithmetic
  219  calculations involved in the board’s determination within 30
  220  days after receipt of the information on which the determination
  221  was based. The office shall notify assessable insurers and the
  222  Florida Surplus Lines Service Office of the date on which
  223  assessable insurers shall begin to collect and assessable
  224  insureds shall begin to pay such assessment. The date must be at
  225  least 90 days after the date the corporation levies emergency
  226  assessments pursuant to this sub-subparagraph. Notwithstanding
  227  any other provision of law, the corporation and each assessable
  228  insurer that writes subject lines of business shall collect
  229  emergency assessments from its policyholders without such
  230  obligation being affected by any credit, limitation, exemption,
  231  or deferment. Emergency assessments levied by the corporation on
  232  assessable insureds shall be collected by the surplus lines
  233  agent at the time the surplus lines agent collects the surplus
  234  lines tax required by s. 626.932 and paid to the Florida Surplus
  235  Lines Service Office at the time the surplus lines agent pays
  236  the surplus lines tax to that office. The emergency assessments
  237  collected shall be transferred directly to the corporation on a
  238  periodic basis as determined by the corporation and held by the
  239  corporation solely in the applicable account. The aggregate
  240  amount of emergency assessments levied for an account in any
  241  calendar year may be less than but may not exceed the greater of
  242  10 percent of the amount needed to cover the deficit, plus
  243  interest, fees, commissions, required reserves, and other costs
  244  associated with financing the original deficit, or 10 percent of
  245  the aggregate statewide direct written premium for subject lines
  246  of business and all accounts of the corporation for the prior
  247  year, plus interest, fees, commissions, required reserves, and
  248  other costs associated with financing the deficit.
  249         f.e. The corporation may pledge the proceeds of
  250  assessments, projected recoveries from the Florida Hurricane
  251  Catastrophe Fund, other insurance and reinsurance recoverables,
  252  policyholder surcharges and other surcharges, and other funds
  253  available to the corporation as the source of revenue for and to
  254  secure bonds issued under paragraph (q), bonds or other
  255  indebtedness issued under subparagraph (c)3., or lines of credit
  256  or other financing mechanisms issued or created under this
  257  subsection, or to retire any other debt incurred as a result of
  258  deficits or events giving rise to deficits, or in any other way
  259  that the board determines will efficiently recover such
  260  deficits. The purpose of the lines of credit or other financing
  261  mechanisms is to provide additional resources to assist the
  262  corporation in covering claims and expenses attributable to a
  263  catastrophe. As used in this subsection, the term “assessments”
  264  includes regular assessments under sub-subparagraph a. or
  265  subparagraph (q)1. and emergency assessments under sub
  266  subparagraph e. d. Emergency assessments collected under sub
  267  subparagraph e. d. are not part of an insurer’s rates, are not
  268  premium, and are not subject to premium tax, fees, or
  269  commissions; however, failure to pay the emergency assessment
  270  shall be treated as failure to pay premium. The emergency
  271  assessments shall continue as long as any bonds issued or other
  272  indebtedness incurred with respect to a deficit for which the
  273  assessment was imposed remain outstanding, unless adequate
  274  provision has been made for the payment of such bonds or other
  275  indebtedness pursuant to the documents governing such bonds or
  276  indebtedness.
  277         g.f. As used in this subsection for purposes of any deficit
  278  incurred on or after January 25, 2007, the term “subject lines
  279  of business” means insurance written by assessable insurers or
  280  procured by assessable insureds for all property and casualty
  281  lines of business in this state, but not including workers’
  282  compensation or medical malpractice. As used in this sub
  283  subparagraph, the term “property and casualty lines of business”
  284  includes all lines of business identified on Form 2, Exhibit of
  285  Premiums and Losses, in the annual statement required of
  286  authorized insurers under s. 624.424 and any rule adopted under
  287  this section, except for those lines identified as accident and
  288  health insurance and except for policies written under the
  289  National Flood Insurance Program or the Federal Crop Insurance
  290  Program. For purposes of this sub-subparagraph, the term
  291  “workers’ compensation” includes both workers’ compensation
  292  insurance and excess workers’ compensation insurance.
  293         h.g. The Florida Surplus Lines Service Office shall
  294  determine annually the aggregate statewide written premium in
  295  subject lines of business procured by assessable insureds and
  296  report that information to the corporation in a form and at a
  297  time the corporation specifies to ensure that the corporation
  298  can meet the requirements of this subsection and the
  299  corporation’s financing obligations.
  300         i.h. The Florida Surplus Lines Service Office shall verify
  301  the proper application by surplus lines agents of assessment
  302  percentages for regular assessments and emergency assessments
  303  levied under this subparagraph on assessable insureds and assist
  304  the corporation in ensuring the accurate, timely collection and
  305  payment of assessments by surplus lines agents as required by
  306  the corporation.
  307         j.i. Upon determination by the board of governors that an
  308  account has a projected deficit, the board shall levy a Citizens
  309  policyholder surcharge against all policyholders of the
  310  corporation.
  311         (I) The surcharge shall be levied as a uniform percentage
  312  of the premium for the policy of up to 15 percent of such
  313  premium, which funds shall be used to offset the deficit.
  314         (II) The surcharge is payable upon cancellation or
  315  termination of the policy, upon renewal of the policy, or upon
  316  issuance of a new policy by the corporation within the first 12
  317  months after the date of the levy or the period of time
  318  necessary to fully collect the surcharge amount.
  319         (III) The corporation may not levy any regular assessments
  320  under paragraph (q) pursuant to sub-subparagraph a. or sub
  321  subparagraph b. with respect to a particular year’s deficit
  322  until the corporation has first levied the full amount of the
  323  surcharge authorized by this sub-subparagraph.
  324         (IV) The surcharge is not considered premium and is not
  325  subject to commissions, fees, or premium taxes. However, failure
  326  to pay the surcharge shall be treated as failure to pay premium.
  327         k.j. If the amount of any assessments or surcharges
  328  collected from corporation policyholders, assessable insurers or
  329  their policyholders, or assessable insureds exceeds the amount
  330  of the deficits, such excess amounts shall be remitted to and
  331  retained by the corporation in a reserve to be used by the
  332  corporation, as determined by the board of governors and
  333  approved by the office, to pay claims or reduce any past,
  334  present, or future plan-year deficits or to reduce outstanding
  335  debt.
  336         4.The Citizens account, if established by the corporation
  337  pursuant to sub-subparagraph 2.b., is authorized to provide:
  338         a.Personal residential policies that provide
  339  comprehensive, multiperil coverage on risks that are not located
  340  in areas eligible for coverage by the Florida Windstorm
  341  Underwriting Association, as those areas were defined on January
  342  1, 2002, and for policies that do not provide coverage for the
  343  peril of wind on risks that are located in such areas;
  344         b.Commercial residential and commercial nonresidential
  345  policies that provide coverage for basic property perils on
  346  risks that are not located in areas eligible for coverage by the
  347  Florida Windstorm Underwriting Association, as those areas were
  348  defined on January 1, 2002, and for policies that do not provide
  349  coverage for the peril of wind on risks that are located in such
  350  areas; and
  351         c.Personal residential policies and commercial residential
  352  and commercial nonresidential property policies that provide
  353  coverage for the peril of wind on risks that are located in
  354  areas eligible for coverage by the Florida Windstorm
  355  Underwriting Association, as those areas were defined on January
  356  1, 2002. The corporation may offer policies that provide
  357  multiperil coverage and shall offer policies that provide
  358  coverage only for the peril of wind for risks located in areas
  359  eligible for coverage by the Florida Windstorm Underwriting
  360  Association, as those areas were defined on January 1, 2002. The
  361  corporation may not offer new commercial residential policies
  362  providing multiperil coverage, but shall continue to offer
  363  commercial residential wind-only policies, and may offer
  364  commercial residential policies excluding wind. However, the
  365  corporation may continue to renew a commercial residential
  366  multiperil policy on a building that was insured by the
  367  corporation on June 30, 2014, under a multiperil policy. In
  368  issuing multiperil coverage under this sub-subparagraph, the
  369  corporation may use its approved policy forms and rates for
  370  risks located in areas not eligible for coverage by the Florida
  371  Windstorm Underwriting Association as those areas were defined
  372  on January 1, 2002, and for policies that do not provide
  373  coverage for the peril of wind on risks that are located in such
  374  areas. An applicant or insured who is eligible to purchase a
  375  multiperil policy from the corporation may purchase a multiperil
  376  policy from an authorized insurer without prejudice to the
  377  applicant’s or insured’s eligibility to prospectively purchase a
  378  policy that provides coverage only for the peril of wind from
  379  the corporation. An applicant or insured who is eligible for a
  380  corporation policy that provides coverage only for the peril of
  381  wind may elect to purchase or retain such policy and also
  382  purchase or retain coverage excluding wind from an authorized
  383  insurer without prejudice to the applicant’s or insured’s
  384  eligibility to prospectively purchase a policy that provides
  385  multiperil coverage from the corporation. The following
  386  policies, which provide coverage only for the peril of wind,
  387  must also include quota share primary insurance under
  388  subparagraph (c)2.: Personal residential policies and commercial
  389  residential and commercial nonresidential property policies that
  390  provide coverage for the peril of wind on risks that are located
  391  in areas eligible for coverage by the Florida Windstorm
  392  Underwriting Association, as those areas were defined on January
  393  1, 2002; policies that provide multiperil coverage, if offered
  394  by the corporation, and policies that provide coverage only for
  395  the peril of wind for risks located in areas eligible for
  396  coverage by the Florida Windstorm Underwriting Association, as
  397  those areas were defined on January 1, 2002; commercial
  398  residential wind-only policies; commercial residential policies
  399  excluding wind, if offered by the corporation; and commercial
  400  residential multiperil policies on a building that was insured
  401  by the corporation on June 30, 2014. The area eligible for
  402  coverage with the corporation under this sub-subparagraph
  403  includes the area within Port Canaveral, which is bordered on
  404  the south by the City of Cape Canaveral, bordered on the west by
  405  the Banana River, and bordered on the north by Federal
  406  Government property.
  407         5.With respect to a deficit in the Citizens account:
  408         a.Upon a determination by the board of governors that the
  409  Citizens account has a projected deficit, the board shall levy a
  410  Citizens policyholder surcharge against all policyholders of the
  411  corporation.
  412         (I) The surcharge shall be levied as a uniform percentage
  413  of the premium for the policy of up to 15 percent of such
  414  premium, which funds shall be used to offset the deficit.
  415         (II) The surcharge is payable upon cancellation or
  416  termination of the policy, upon renewal of the policy, or upon
  417  issuance of a new policy by the corporation within the first 12
  418  months after the date of the levy or the period of time
  419  necessary to fully collect the surcharge amount.
  420         (III)The surcharge is not considered premium and is not
  421  subject to commissions, fees, or premium taxes. However, failure
  422  to pay the surcharge shall be treated as failure to pay premium.
  423         b. After accounting for the Citizens policyholder surcharge
  424  imposed under sub-subparagraph a., the remaining projected
  425  deficit incurred in the Citizens account in a particular
  426  calendar year shall be recovered through emergency assessments
  427  under sub-subparagraph c.
  428         c.Upon a determination by the board of governors that a
  429  projected deficit in the Citizens account exceeds the amount
  430  that is expected to be recovered through surcharges under sub
  431  subparagraph a., the board, after verification by the office,
  432  shall levy emergency assessments for as many years as necessary
  433  to cover the deficits, to be collected by assessable insurers
  434  and the corporation and collected from assessable insureds upon
  435  issuance or renewal of policies for subject lines of business,
  436  excluding National Flood Insurance Program policies. The amount
  437  collected in a particular year must be a uniform percentage of
  438  that year’s direct written premium for subject lines of business
  439  and the Citizens account, National Flood Insurance Program
  440  policy premiums, as annually determined by the board and
  441  verified by the office. The office shall verify the arithmetic
  442  calculations involved in the board’s determination within 30
  443  days after receipt of the information on which the determination
  444  was based. The office shall notify assessable insurers and the
  445  Florida Surplus Lines Service Office of the date on which
  446  assessable insurers shall begin to collect and assessable
  447  insureds shall begin to pay such assessment. The date must be at
  448  least 90 days after the date the corporation levies emergency
  449  assessments pursuant to this sub-subparagraph. Notwithstanding
  450  any other law, the corporation and each assessable insurer that
  451  writes subject lines of business shall collect emergency
  452  assessments from its policyholders without such obligation being
  453  affected by any credit, limitation, exemption, or deferment.
  454  Emergency assessments levied by the corporation on assessable
  455  insureds shall be collected by the surplus lines agent at the
  456  time the surplus lines agent collects the surplus lines tax
  457  required by s. 626.932 and paid to the Florida Surplus Lines
  458  Service Office at the time the surplus lines agent pays the
  459  surplus lines tax to that office. The emergency assessments
  460  collected shall be transferred directly to the corporation on a
  461  periodic basis as determined by the corporation and held by the
  462  corporation solely in the Citizens account. The aggregate amount
  463  of emergency assessments levied for the Citizens account in any
  464  calendar year may be less than, but may not exceed the greater
  465  of, 10 percent of the amount needed to cover the deficit, plus
  466  interest, fees, commissions, required reserves, and other costs
  467  associated with financing the original deficit or 10 percent of
  468  the aggregate statewide direct written premium for subject lines
  469  of business and the Citizens accounts for the prior year, plus
  470  interest, fees, commissions, required reserves, and other costs
  471  associated with financing the deficit.
  472         d.The corporation may pledge the proceeds of assessments,
  473  projected recoveries from the Florida Hurricane Catastrophe
  474  Fund, other insurance and reinsurance recoverables, policyholder
  475  surcharges and other surcharges, and other funds available to
  476  the corporation as the source of revenue for and to secure bonds
  477  issued under paragraph (q), bonds or other indebtedness issued
  478  under subparagraph (c)3., or lines of credit or other financing
  479  mechanisms issued or created under this subsection; or to retire
  480  any other debt incurred as a result of deficits or events giving
  481  rise to deficits, or in any other way that the board determines
  482  will efficiently recover such deficits. The purpose of the lines
  483  of credit or other financing mechanisms is to provide additional
  484  resources to assist the corporation in covering claims and
  485  expenses attributable to a catastrophe. As used in this
  486  subsection, the term “assessments” includes emergency
  487  assessments under sub-subparagraph c. Emergency assessments
  488  collected under sub-subparagraph c. are not part of an insurer’s
  489  rates, are not premium, and are not subject to premium tax,
  490  fees, or commissions; however, failure to pay the emergency
  491  assessment shall be treated as failure to pay premium. The
  492  emergency assessments shall continue as long as any bonds issued
  493  or other indebtedness incurred with respect to a deficit for
  494  which the assessment was imposed remain outstanding, unless
  495  adequate provision has been made for the payment of such bonds
  496  or other indebtedness pursuant to the documents governing such
  497  bonds or indebtedness.
  498         e.As used in this subsection and for purposes of any
  499  deficit incurred on or after January 25, 2007, the term “subject
  500  lines of business” means insurance written by assessable
  501  insurers or procured by assessable insureds for all property and
  502  casualty lines of business in this state, but not including
  503  workers’ compensation or medical malpractice. As used in this
  504  sub-subparagraph, the term “property and casualty lines of
  505  business” includes all lines of business identified on Form 2,
  506  Exhibit of Premiums and Losses, in the annual statement required
  507  of authorized insurers under s. 624.424 and any rule adopted
  508  under this section, except for those lines identified as
  509  accident and health insurance and except for policies written
  510  under the National Flood Insurance Program or the Federal Crop
  511  Insurance Program. For purposes of this sub-subparagraph, the
  512  term “workers’ compensation” includes both workers’ compensation
  513  insurance and excess workers’ compensation insurance.
  514         f.The Florida Surplus Lines Service Office shall annually
  515  determine the aggregate statewide written premium in subject
  516  lines of business procured by assessable insureds and report
  517  that information to the corporation in a form and at a time the
  518  corporation specifies to ensure that the corporation can meet
  519  the requirements of this subsection and the corporation’s
  520  financing obligations.
  521         g.The Florida Surplus Lines Service Office shall verify
  522  the proper application by surplus lines agents of assessment
  523  percentages for emergency assessments levied under this
  524  subparagraph on assessable insureds and assist the corporation
  525  in ensuring the accurate, timely collection and payment of
  526  assessments by surplus lines agents as required by the
  527  corporation.
  528         h.If the amount of any assessments or surcharges collected
  529  from corporation policyholders, assessable insurers or their
  530  policyholders, or assessable insureds exceeds the amount of the
  531  deficits, such excess amounts shall be remitted to and retained
  532  by the corporation in a reserve to be used by the corporation,
  533  as determined by the board of governors and approved by the
  534  office, to pay claims or reduce any past, present, or future
  535  plan-year deficits or to reduce outstanding debt.
  536         (c) The corporation’s plan of operation:
  537         1. Must provide for adoption of residential property and
  538  casualty insurance policy forms and commercial residential and
  539  nonresidential property insurance forms, which must be approved
  540  by the office before use. The corporation shall adopt the
  541  following policy forms:
  542         a. Standard personal lines policy forms that are
  543  comprehensive multiperil policies providing full coverage of a
  544  residential property equivalent to the coverage provided in the
  545  private insurance market under an HO-3, HO-4, or HO-6 policy.
  546         b. Basic personal lines policy forms that are policies
  547  similar to an HO-8 policy or a dwelling fire policy that provide
  548  coverage meeting the requirements of the secondary mortgage
  549  market, but which is more limited than the coverage under a
  550  standard policy.
  551         c. Commercial lines residential and nonresidential policy
  552  forms that are generally similar to the basic perils of full
  553  coverage obtainable for commercial residential structures and
  554  commercial nonresidential structures in the admitted voluntary
  555  market.
  556         d. Personal lines and commercial lines residential property
  557  insurance forms that cover the peril of wind only. The forms are
  558  applicable only to residential properties located in areas
  559  eligible for coverage by the Florida Windstorm Underwriting
  560  Association, as those areas were defined on January 1, 2002
  561  under the coastal account referred to in sub-subparagraph
  562  (b)2.a.
  563         e. Commercial lines nonresidential property insurance forms
  564  that cover the peril of wind only. The forms are applicable only
  565  to nonresidential properties located in areas eligible for
  566  coverage by the Florida Windstorm Underwriting Association, as
  567  those areas were defined on January 1, 2002 under the coastal
  568  account referred to in sub-subparagraph (b)2.a.
  569         f. The corporation may adopt variations of the policy forms
  570  listed in sub-subparagraphs a.-e. which contain more restrictive
  571  coverage.
  572         g. Effective January 1, 2013, The corporation shall offer a
  573  basic personal lines policy similar to an HO-8 policy with
  574  dwelling repair based on common construction materials and
  575  methods.
  576         2. Must provide that the corporation adopt a program in
  577  which the corporation and authorized insurers enter into quota
  578  share primary insurance agreements for hurricane coverage, as
  579  defined in s. 627.4025(2)(a), for eligible risks, and adopt
  580  property insurance forms for eligible risks which cover the
  581  peril of wind only.
  582         a. As used in this subsection, the term:
  583         (I) “Quota share primary insurance” means an arrangement in
  584  which the primary hurricane coverage of an eligible risk is
  585  provided in specified percentages by the corporation and an
  586  authorized insurer. The corporation and authorized insurer are
  587  each solely responsible for a specified percentage of hurricane
  588  coverage of an eligible risk as set forth in a quota share
  589  primary insurance agreement between the corporation and an
  590  authorized insurer and the insurance contract. The
  591  responsibility of the corporation or authorized insurer to pay
  592  its specified percentage of hurricane losses of an eligible
  593  risk, as set forth in the agreement, may not be altered by the
  594  inability of the other party to pay its specified percentage of
  595  losses. Eligible risks that are provided hurricane coverage
  596  through a quota share primary insurance arrangement must be
  597  provided policy forms that set forth the obligations of the
  598  corporation and authorized insurer under the arrangement,
  599  clearly specify the percentages of quota share primary insurance
  600  provided by the corporation and authorized insurer, and
  601  conspicuously and clearly state that the authorized insurer and
  602  the corporation may not be held responsible beyond their
  603  specified percentage of coverage of hurricane losses.
  604         (II) “Eligible risks” means personal lines residential and
  605  commercial lines residential risks that meet the underwriting
  606  criteria of the corporation and are located in areas that were
  607  eligible for coverage by the Florida Windstorm Underwriting
  608  Association on January 1, 2002.
  609         b. The corporation may enter into quota share primary
  610  insurance agreements with authorized insurers at corporation
  611  coverage levels of 90 percent and 50 percent.
  612         c. If the corporation determines that additional coverage
  613  levels are necessary to maximize participation in quota share
  614  primary insurance agreements by authorized insurers, the
  615  corporation may establish additional coverage levels. However,
  616  the corporation’s quota share primary insurance coverage level
  617  may not exceed 90 percent.
  618         d. Any quota share primary insurance agreement entered into
  619  between an authorized insurer and the corporation must provide
  620  for a uniform specified percentage of coverage of hurricane
  621  losses, by county or territory as set forth by the corporation
  622  board, for all eligible risks of the authorized insurer covered
  623  under the agreement.
  624         e. Any quota share primary insurance agreement entered into
  625  between an authorized insurer and the corporation is subject to
  626  review and approval by the office. However, such agreement shall
  627  be authorized only as to insurance contracts entered into
  628  between an authorized insurer and an insured who is already
  629  insured by the corporation for wind coverage.
  630         f. For all eligible risks covered under quota share primary
  631  insurance agreements, the exposure and coverage levels for both
  632  the corporation and authorized insurers shall be reported by the
  633  corporation to the Florida Hurricane Catastrophe Fund. For all
  634  policies of eligible risks covered under such agreements, the
  635  corporation and the authorized insurer must maintain complete
  636  and accurate records for the purpose of exposure and loss
  637  reimbursement audits as required by fund rules. The corporation
  638  and the authorized insurer shall each maintain duplicate copies
  639  of policy declaration pages and supporting claims documents.
  640         g. The corporation board shall establish in its plan of
  641  operation standards for quota share agreements which ensure that
  642  there is no discriminatory application among insurers as to the
  643  terms of the agreements, pricing of the agreements, incentive
  644  provisions if any, and consideration paid for servicing policies
  645  or adjusting claims.
  646         h. The quota share primary insurance agreement between the
  647  corporation and an authorized insurer must set forth the
  648  specific terms under which coverage is provided, including, but
  649  not limited to, the sale and servicing of policies issued under
  650  the agreement by the insurance agent of the authorized insurer
  651  producing the business, the reporting of information concerning
  652  eligible risks, the payment of premium to the corporation, and
  653  arrangements for the adjustment and payment of hurricane claims
  654  incurred on eligible risks by the claims adjuster and personnel
  655  of the authorized insurer. Entering into a quota sharing
  656  insurance agreement between the corporation and an authorized
  657  insurer is voluntary and at the discretion of the authorized
  658  insurer.
  659         3. May provide that the corporation may employ or otherwise
  660  contract with individuals or other entities to provide
  661  administrative or professional services that may be appropriate
  662  to effectuate the plan. The corporation may borrow funds by
  663  issuing bonds or by incurring other indebtedness, and shall have
  664  other powers reasonably necessary to effectuate the requirements
  665  of this subsection, including, without limitation, the power to
  666  issue bonds and incur other indebtedness in order to refinance
  667  outstanding bonds or other indebtedness. The corporation may
  668  seek judicial validation of its bonds or other indebtedness
  669  under chapter 75. The corporation may issue bonds or incur other
  670  indebtedness, or have bonds issued on its behalf by a unit of
  671  local government pursuant to subparagraph (q)2. in the absence
  672  of a hurricane or other weather-related event, upon a
  673  determination by the corporation, subject to approval by the
  674  office, that such action would enable it to efficiently meet the
  675  financial obligations of the corporation and that such
  676  financings are reasonably necessary to effectuate the
  677  requirements of this subsection. The corporation may take all
  678  actions needed to facilitate tax-free status for such bonds or
  679  indebtedness, including formation of trusts or other affiliated
  680  entities. The corporation may pledge assessments, projected
  681  recoveries from the Florida Hurricane Catastrophe Fund, other
  682  reinsurance recoverables, policyholder surcharges and other
  683  surcharges, and other funds available to the corporation as
  684  security for bonds or other indebtedness. In recognition of s.
  685  10, Art. I of the State Constitution, prohibiting the impairment
  686  of obligations of contracts, it is the intent of the Legislature
  687  that no action be taken whose purpose is to impair any bond
  688  indenture or financing agreement or any revenue source committed
  689  by contract to such bond or other indebtedness.
  690         4. Must require that the corporation operate subject to the
  691  supervision and approval of a board of governors consisting of
  692  nine individuals who are residents of this state and who are
  693  from different geographical areas of the state, one of whom is
  694  appointed by the Governor and serves solely to advocate on
  695  behalf of the consumer. The appointment of a consumer
  696  representative by the Governor is deemed to be within the scope
  697  of the exemption provided in s. 112.313(7)(b) and is in addition
  698  to the appointments authorized under sub-subparagraph a.
  699         a. The Governor, the Chief Financial Officer, the President
  700  of the Senate, and the Speaker of the House of Representatives
  701  shall each appoint two members of the board. At least one of the
  702  two members appointed by each appointing officer must have
  703  demonstrated expertise in insurance and be deemed to be within
  704  the scope of the exemption provided in s. 112.313(7)(b). The
  705  Chief Financial Officer shall designate one of the appointees as
  706  chair. All board members serve at the pleasure of the appointing
  707  officer. All members of the board are subject to removal at will
  708  by the officers who appointed them. All board members, including
  709  the chair, must be appointed to serve for 3-year terms beginning
  710  annually on a date designated by the plan. However, for the
  711  first term beginning on or after July 1, 2009, each appointing
  712  officer shall appoint one member of the board for a 2-year term
  713  and one member for a 3-year term. A board vacancy shall be
  714  filled for the unexpired term by the appointing officer. The
  715  Chief Financial Officer shall appoint a technical advisory group
  716  to provide information and advice to the board in connection
  717  with the board’s duties under this subsection. The executive
  718  director and senior managers of the corporation shall be engaged
  719  by the board and serve at the pleasure of the board. Any
  720  executive director appointed on or after July 1, 2006, is
  721  subject to confirmation by the Senate. The executive director is
  722  responsible for employing other staff as the corporation may
  723  require, subject to review and concurrence by the board.
  724         b. The board shall create a Market Accountability Advisory
  725  Committee to assist the corporation in developing awareness of
  726  its rates and its customer and agent service levels in
  727  relationship to the voluntary market insurers writing similar
  728  coverage.
  729         (I) The members of the advisory committee consist of the
  730  following 11 persons, one of whom must be elected chair by the
  731  members of the committee: four representatives, one appointed by
  732  the Florida Association of Insurance Agents, one by the Florida
  733  Association of Insurance and Financial Advisors, one by the
  734  Professional Insurance Agents of Florida, and one by the Latin
  735  American Association of Insurance Agencies; three
  736  representatives appointed by the insurers with the three highest
  737  voluntary market share of residential property insurance
  738  business in the state; one representative from the Office of
  739  Insurance Regulation; one consumer appointed by the board who is
  740  insured by the corporation at the time of appointment to the
  741  committee; one representative appointed by the Florida
  742  Association of Realtors; and one representative appointed by the
  743  Florida Bankers Association. All members shall be appointed to
  744  3-year terms and may serve for consecutive terms.
  745         (II) The committee shall report to the corporation at each
  746  board meeting on insurance market issues which may include rates
  747  and rate competition with the voluntary market; service,
  748  including policy issuance, claims processing, and general
  749  responsiveness to policyholders, applicants, and agents; and
  750  matters relating to depopulation.
  751         5. Must provide a procedure for determining the eligibility
  752  of a risk for coverage, as follows:
  753         a. Subject to s. 627.3517, with respect to personal lines
  754  residential risks, if the risk is offered coverage from an
  755  authorized insurer at the insurer’s approved rate under a
  756  standard policy including wind coverage or, if consistent with
  757  the insurer’s underwriting rules as filed with the office, a
  758  basic policy including wind coverage, for a new application to
  759  the corporation for coverage, the risk is not eligible for any
  760  policy issued by the corporation unless the premium for coverage
  761  from the authorized insurer is more than 20 percent greater than
  762  the premium for comparable coverage from the corporation.
  763  Whenever an offer of coverage for a personal lines residential
  764  risk is received for a policyholder of the corporation at
  765  renewal from an authorized insurer, if the offer is equal to or
  766  less than the corporation’s renewal premium for comparable
  767  coverage, the risk is not eligible for coverage with the
  768  corporation for policies that renew before April 1, 2023; for
  769  policies that renew on or after that date, the risk is not
  770  eligible for coverage with the corporation unless the premium
  771  for coverage from the authorized insurer is more than 20 percent
  772  greater than the corporation’s renewal premium for comparable
  773  coverage. If the risk is not able to obtain such offer, the risk
  774  is eligible for a standard policy including wind coverage or a
  775  basic policy including wind coverage issued by the corporation;
  776  however, if the risk could not be insured under a standard
  777  policy including wind coverage regardless of market conditions,
  778  the risk is eligible for a basic policy including wind coverage
  779  unless rejected under subparagraph 8. However, a policyholder
  780  removed from the corporation through an assumption agreement
  781  remains eligible for coverage from the corporation until the end
  782  of the assumption period. The corporation shall determine the
  783  type of policy to be provided on the basis of objective
  784  standards specified in the underwriting manual and based on
  785  generally accepted underwriting practices. A policyholder
  786  removed from the corporation through an assumption agreement
  787  does not remain eligible for coverage from the corporation after
  788  the end of the policy term. However, any policy removed from the
  789  corporation through an assumption agreement remains on the
  790  corporation’s policy forms through the end of the policy term.
  791         (I) If the risk accepts an offer of coverage through the
  792  market assistance plan or through a mechanism established by the
  793  corporation other than a plan established by s. 627.3518, before
  794  a policy is issued to the risk by the corporation or during the
  795  first 30 days of coverage by the corporation, and the producing
  796  agent who submitted the application to the plan or to the
  797  corporation is not currently appointed by the insurer, the
  798  insurer shall:
  799         (A) Pay to the producing agent of record of the policy for
  800  the first year, an amount that is the greater of the insurer’s
  801  usual and customary commission for the type of policy written or
  802  a fee equal to the usual and customary commission of the
  803  corporation; or
  804         (B) Offer to allow the producing agent of record of the
  805  policy to continue servicing the policy for at least 1 year and
  806  offer to pay the agent the greater of the insurer’s or the
  807  corporation’s usual and customary commission for the type of
  808  policy written.
  809  
  810  If the producing agent is unwilling or unable to accept
  811  appointment, the new insurer shall pay the agent in accordance
  812  with sub-sub-sub-subparagraph (A).
  813         (II) If the corporation enters into a contractual agreement
  814  for a take-out plan, the producing agent of record of the
  815  corporation policy is entitled to retain any unearned commission
  816  on the policy, and the insurer shall:
  817         (A) Pay to the producing agent of record, for the first
  818  year, an amount that is the greater of the insurer’s usual and
  819  customary commission for the type of policy written or a fee
  820  equal to the usual and customary commission of the corporation;
  821  or
  822         (B) Offer to allow the producing agent of record to
  823  continue servicing the policy for at least 1 year and offer to
  824  pay the agent the greater of the insurer’s or the corporation’s
  825  usual and customary commission for the type of policy written.
  826  
  827  If the producing agent is unwilling or unable to accept
  828  appointment, the new insurer shall pay the agent in accordance
  829  with sub-sub-sub-subparagraph (A).
  830         b. With respect to commercial lines residential risks, for
  831  a new application to the corporation for coverage, if the risk
  832  is offered coverage under a policy including wind coverage from
  833  an authorized insurer at its approved rate, the risk is not
  834  eligible for a policy issued by the corporation unless the
  835  premium for coverage from the authorized insurer is more than 20
  836  15 percent greater than the premium for comparable coverage from
  837  the corporation. Whenever an offer of coverage for a commercial
  838  lines residential risk is received for a policyholder of the
  839  corporation at renewal from an authorized insurer, if the offer
  840  is equal to or less than the corporation’s renewal premium for
  841  comparable coverage, the risk is not eligible for coverage with
  842  the corporation unless the premium for coverage from the
  843  authorized insurer is more than 20 percent greater than the
  844  corporation’s renewal premium for comparable coverage. If the
  845  risk is not able to obtain any such offer, the risk is eligible
  846  for a policy including wind coverage issued by the corporation.
  847  However, A policyholder removed from the corporation through an
  848  assumption agreement remains eligible for coverage from the
  849  corporation until the end of the policy term. However, any
  850  policy removed from the corporation through an assumption
  851  agreement remains on the corporation’s policy forms through the
  852  end of the policy term assumption period.
  853         (I) If the risk accepts an offer of coverage through the
  854  market assistance plan or through a mechanism established by the
  855  corporation other than a plan established by s. 627.3518, before
  856  a policy is issued to the risk by the corporation or during the
  857  first 30 days of coverage by the corporation, and the producing
  858  agent who submitted the application to the plan or the
  859  corporation is not currently appointed by the insurer, the
  860  insurer shall:
  861         (A) Pay to the producing agent of record of the policy, for
  862  the first year, an amount that is the greater of the insurer’s
  863  usual and customary commission for the type of policy written or
  864  a fee equal to the usual and customary commission of the
  865  corporation; or
  866         (B) Offer to allow the producing agent of record of the
  867  policy to continue servicing the policy for at least 1 year and
  868  offer to pay the agent the greater of the insurer’s or the
  869  corporation’s usual and customary commission for the type of
  870  policy written.
  871  
  872  If the producing agent is unwilling or unable to accept
  873  appointment, the new insurer shall pay the agent in accordance
  874  with sub-sub-sub-subparagraph (A).
  875         (II) If the corporation enters into a contractual agreement
  876  for a take-out plan, the producing agent of record of the
  877  corporation policy is entitled to retain any unearned commission
  878  on the policy, and the insurer shall:
  879         (A) Pay to the producing agent of record, for the first
  880  year, an amount that is the greater of the insurer’s usual and
  881  customary commission for the type of policy written or a fee
  882  equal to the usual and customary commission of the corporation;
  883  or
  884         (B) Offer to allow the producing agent of record to
  885  continue servicing the policy for at least 1 year and offer to
  886  pay the agent the greater of the insurer’s or the corporation’s
  887  usual and customary commission for the type of policy written.
  888  
  889  If the producing agent is unwilling or unable to accept
  890  appointment, the new insurer shall pay the agent in accordance
  891  with sub-sub-sub-subparagraph (A).
  892         c. For purposes of determining comparable coverage under
  893  sub-subparagraphs a. and b., the comparison must be based on
  894  those forms and coverages that are reasonably comparable. The
  895  corporation may rely on a determination of comparable coverage
  896  and premium made by the producing agent who submits the
  897  application to the corporation, made in the agent’s capacity as
  898  the corporation’s agent. For purposes of comparing the premium
  899  for comparable coverage under sub-subparagraphs a. and b.,
  900  premium includes any surcharge or assessment that is actually
  901  applied to such policy. A comparison may be made solely of the
  902  premium with respect to the main building or structure only on
  903  the following basis: the same coverage A or other building
  904  limits; the same percentage hurricane deductible that applies on
  905  an annual basis or that applies to each hurricane for commercial
  906  residential property; the same percentage of ordinance and law
  907  coverage, if the same limit is offered by both the corporation
  908  and the authorized insurer; the same mitigation credits, to the
  909  extent the same types of credits are offered both by the
  910  corporation and the authorized insurer; the same method for loss
  911  payment, such as replacement cost or actual cash value, if the
  912  same method is offered both by the corporation and the
  913  authorized insurer in accordance with underwriting rules; and
  914  any other form or coverage that is reasonably comparable as
  915  determined by the board. If an application is submitted to the
  916  corporation for wind-only coverage on a risk that is located in
  917  an area eligible for coverage by the Florida Windstorm
  918  Underwriting Association, as that area was defined on January 1,
  919  2002 in the coastal account, the premium for the corporation’s
  920  wind-only policy plus the premium for the ex-wind policy that is
  921  offered by an authorized insurer to the applicant must be
  922  compared to the premium for multiperil coverage offered by an
  923  authorized insurer, subject to the standards for comparison
  924  specified in this subparagraph. If the corporation or the
  925  applicant requests from the authorized insurer a breakdown of
  926  the premium of the offer by types of coverage so that a
  927  comparison may be made by the corporation or its agent and the
  928  authorized insurer refuses or is unable to provide such
  929  information, the corporation may treat the offer as not being an
  930  offer of coverage from an authorized insurer at the insurer’s
  931  approved rate.
  932         6. Must include rules for classifications of risks and
  933  rates.
  934         7. Must provide that if premium and investment income:
  935         a. For an account attributable to a particular calendar
  936  year are in excess of projected losses and expenses for the
  937  account attributable to that year, such excess shall be held in
  938  surplus in the account. Such surplus must be available to defray
  939  deficits in that account as to future years and used for that
  940  purpose before assessing assessable insurers and assessable
  941  insureds as to any calendar year; or
  942         b.For the Citizens account, if established by the
  943  corporation, which are attributable to a particular calendar
  944  year are in excess of projected losses and expenses for the
  945  Citizens account attributable to that year, such excess shall be
  946  held in surplus in the Citizens account. Such surplus must be
  947  available to defray deficits in the Citizens account as to
  948  future years and used for that purpose before assessing
  949  assessable insurers and assessable insureds as to any calendar
  950  year.
  951         8. Must provide objective criteria and procedures to be
  952  uniformly applied to all applicants in determining whether an
  953  individual risk is so hazardous as to be uninsurable. In making
  954  this determination and in establishing the criteria and
  955  procedures, the following must be considered:
  956         a. Whether the likelihood of a loss for the individual risk
  957  is substantially higher than for other risks of the same class;
  958  and
  959         b. Whether the uncertainty associated with the individual
  960  risk is such that an appropriate premium cannot be determined.
  961  
  962  The acceptance or rejection of a risk by the corporation shall
  963  be construed as the private placement of insurance, and the
  964  provisions of chapter 120 do not apply.
  965         9. Must provide that the corporation make its best efforts
  966  to procure catastrophe reinsurance at reasonable rates, to cover
  967  its projected 100-year probable maximum loss as determined by
  968  the board of governors. If catastrophe reinsurance is not
  969  available at reasonable rates, the corporation need not purchase
  970  it, but the corporation shall include the costs of reinsurance
  971  to cover its projected 100-year probable maximum loss in its
  972  rate calculations even if it does not purchase catastrophe
  973  reinsurance.
  974         10. The policies issued by the corporation must provide
  975  that if the corporation or the market assistance plan obtains an
  976  offer from an authorized insurer to cover the risk at its
  977  approved rates, the risk is no longer eligible for renewal
  978  through the corporation, except as otherwise provided in this
  979  subsection.
  980         11. Corporation policies and applications must include a
  981  notice that the corporation policy could, under this section, be
  982  replaced with a policy issued by an authorized insurer which
  983  does not provide coverage identical to the coverage provided by
  984  the corporation. The notice must also specify that acceptance of
  985  corporation coverage creates a conclusive presumption that the
  986  applicant or policyholder is aware of this potential.
  987         12. May establish, subject to approval by the office,
  988  different eligibility requirements and operational procedures
  989  for any line or type of coverage for any specified county or
  990  area if the board determines that such changes are justified due
  991  to the voluntary market being sufficiently stable and
  992  competitive in such area or for such line or type of coverage
  993  and that consumers who, in good faith, are unable to obtain
  994  insurance through the voluntary market through ordinary methods
  995  continue to have access to coverage from the corporation. If
  996  coverage is sought in connection with a real property transfer,
  997  the requirements and procedures may not provide an effective
  998  date of coverage later than the date of the closing of the
  999  transfer as established by the transferor, the transferee, and,
 1000  if applicable, the lender.
 1001         13. Must provide that:,
 1002         a. With respect to the coastal account, any assessable
 1003  insurer with a surplus as to policyholders of $25 million or
 1004  less writing 25 percent or more of its total countrywide
 1005  property insurance premiums in this state may petition the
 1006  office, within the first 90 days of each calendar year, to
 1007  qualify as a limited apportionment company. A regular assessment
 1008  levied by the corporation on a limited apportionment company for
 1009  a deficit incurred by the corporation for the coastal account
 1010  may be paid to the corporation on a monthly basis as the
 1011  assessments are collected by the limited apportionment company
 1012  from its insureds, but a limited apportionment company must
 1013  begin collecting the regular assessments not later than 90 days
 1014  after the regular assessments are levied by the corporation, and
 1015  the regular assessments must be paid in full within 15 months
 1016  after being levied by the corporation. A limited apportionment
 1017  company shall collect from its policyholders any emergency
 1018  assessment imposed under sub-subparagraph (b)3.e. (b)3.d. The
 1019  plan must provide that, if the office determines that any
 1020  regular assessment will result in an impairment of the surplus
 1021  of a limited apportionment company, the office may direct that
 1022  all or part of such assessment be deferred as provided in
 1023  subparagraph (q)4. However, an emergency assessment to be
 1024  collected from policyholders under sub-subparagraph (b)3.e.
 1025  (b)3.d. may not be limited or deferred; or
 1026         b.With respect to the Citizens account, if established by
 1027  the corporation pursuant to sub-subparagraph (b)2.b., any
 1028  assessable insurer with a surplus as to policyholders of $25
 1029  million or less and writing 25 percent or more of its total
 1030  countrywide property insurance premiums in this state may
 1031  petition the office, within the first 90 days of each calendar
 1032  year, to qualify as a limited apportionment company. A limited
 1033  apportionment company shall collect from its policyholders any
 1034  emergency assessment imposed under sub-subparagraph (b)5.c. An
 1035  emergency assessment to be collected from policyholders under
 1036  sub-subparagraph (b)5.c. may not be limited or deferred.
 1037         14. Must provide that the corporation appoint as its
 1038  licensed agents only those agents who throughout such
 1039  appointments also hold an appointment as defined in s. 626.015
 1040  by an insurer who is authorized to write and is actually writing
 1041  or renewing personal lines residential property coverage,
 1042  commercial residential property coverage, or commercial
 1043  nonresidential property coverage within the state.
 1044         15. Must provide a premium payment plan option to its
 1045  policyholders which, at a minimum, allows for quarterly and
 1046  semiannual payment of premiums. A monthly payment plan may, but
 1047  is not required to, be offered.
 1048         16. Must limit coverage on mobile homes or manufactured
 1049  homes built before 1994 to actual cash value of the dwelling
 1050  rather than replacement costs of the dwelling.
 1051         17. Must provide coverage for manufactured or mobile home
 1052  dwellings. Such coverage must also include the following
 1053  attached structures:
 1054         a. Screened enclosures that are aluminum framed or screened
 1055  enclosures that are not covered by the same or substantially the
 1056  same materials as those of the primary dwelling;
 1057         b. Carports that are aluminum or carports that are not
 1058  covered by the same or substantially the same materials as those
 1059  of the primary dwelling; and
 1060         c. Patios that have a roof covering that is constructed of
 1061  materials that are not the same or substantially the same
 1062  materials as those of the primary dwelling.
 1063  
 1064  The corporation shall make available a policy for mobile homes
 1065  or manufactured homes for a minimum insured value of at least
 1066  $3,000.
 1067         18. May provide such limits of coverage as the board
 1068  determines, consistent with the requirements of this subsection.
 1069         19. May require commercial property to meet specified
 1070  hurricane mitigation construction features as a condition of
 1071  eligibility for coverage.
 1072         20. Must provide that new or renewal policies issued by the
 1073  corporation on or after January 1, 2012, which cover sinkhole
 1074  loss do not include coverage for any loss to appurtenant
 1075  structures, driveways, sidewalks, decks, or patios that are
 1076  directly or indirectly caused by sinkhole activity. The
 1077  corporation shall exclude such coverage using a notice of
 1078  coverage change, which may be included with the policy renewal,
 1079  and not by issuance of a notice of nonrenewal of the excluded
 1080  coverage upon renewal of the current policy.
 1081         21.a. As of January 1, 2012, unless the Citizens account
 1082  has been established pursuant to sub-subparagraph (b)2.b., must
 1083  require that the agent obtain from an applicant for coverage
 1084  from the corporation an acknowledgment signed by the applicant,
 1085  which includes, at a minimum, the following statement:
 1086  
 1087                ACKNOWLEDGMENT OF POTENTIAL SURCHARGE              
 1088                      AND ASSESSMENT LIABILITY:                    
 1089  
 1090         1. AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE
 1091  CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A
 1092  DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON,
 1093  MY POLICY COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND
 1094  PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF THE
 1095  POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH AS 45 PERCENT
 1096  OF MY PREMIUM, OR A DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA
 1097  LEGISLATURE.
 1098         2. I UNDERSTAND THAT I CAN AVOID THE CITIZENS POLICYHOLDER
 1099  SURCHARGE, WHICH COULD BE AS HIGH AS 45 PERCENT OF MY PREMIUM,
 1100  BY OBTAINING COVERAGE FROM A PRIVATE MARKET INSURER AND THAT TO
 1101  BE ELIGIBLE FOR COVERAGE BY CITIZENS, I MUST FIRST TRY TO OBTAIN
 1102  PRIVATE MARKET COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE
 1103  WITH CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES
 1104  ARE REGULATED AND APPROVED BY THE STATE.
 1105         3. I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY
 1106  ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER
 1107  INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE
 1108  FLORIDA LEGISLATURE.
 1109         4. I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE
 1110  CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
 1111  STATE OF FLORIDA.
 1112  
 1113         b.The corporation must require, if it has established the
 1114  Citizens account pursuant to sub-subparagraph (b)2.b., that the
 1115  agent obtain from an applicant for coverage from the corporation
 1116  the following acknowledgment signed by the applicant, which
 1117  includes, at a minimum, the following statement:
 1118  
 1119                ACKNOWLEDGMENT OF POTENTIAL SURCHARGE              
 1120                      AND ASSESSMENT LIABILITY:                    
 1121  
 1122         1.AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE
 1123  CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A
 1124  DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON,
 1125  MY POLICY COULD BE SUBJECT TO SURCHARGES AND ASSESSMENTS, WHICH
 1126  WILL BE DUE AND PAYABLE UPON RENEWAL, CANCELLATION, OR
 1127  TERMINATION OF THE POLICY, AND THAT THE SURCHARGES AND
 1128  ASSESSMENTS COULD BE AS HIGH AS 25 PERCENT OF MY PREMIUM, OR A
 1129  DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA LEGISLATURE.
 1130         2.I UNDERSTAND THAT I CAN AVOID THE CITIZENS POLICYHOLDER
 1131  SURCHARGE, WHICH COULD BE AS HIGH AS 15 PERCENT OF MY PREMIUM,
 1132  BY OBTAINING COVERAGE FROM A PRIVATE MARKET INSURER AND THAT TO
 1133  BE ELIGIBLE FOR COVERAGE BY CITIZENS, I MUST FIRST TRY TO OBTAIN
 1134  PRIVATE MARKET COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE
 1135  WITH CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES
 1136  ARE REGULATED AND APPROVED BY THE STATE.
 1137         3.I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY
 1138  ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER
 1139  INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE
 1140  FLORIDA LEGISLATURE.
 1141         4.I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE
 1142  CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
 1143  STATE OF FLORIDA.
 1144  
 1145         c.a. The corporation shall maintain, in electronic format
 1146  or otherwise, a copy of the applicant’s signed acknowledgment
 1147  and provide a copy of the statement to the policyholder as part
 1148  of the first renewal after the effective date of sub
 1149  subparagraph a. or sub-subparagraph b., as applicable this
 1150  subparagraph.
 1151         d.b. The signed acknowledgment form creates a conclusive
 1152  presumption that the policyholder understood and accepted his or
 1153  her potential surcharge and assessment liability as a
 1154  policyholder of the corporation.
 1155         (n)1. Rates for coverage provided by the corporation must
 1156  be actuarially sound pursuant and subject to s. 627.062 and not
 1157  competitive with approved rates charged in the admitted
 1158  voluntary market so that the corporation functions as a residual
 1159  market mechanism to provide insurance only when insurance cannot
 1160  be procured in the voluntary market, except as otherwise
 1161  provided in this paragraph. The office shall provide the
 1162  corporation such information as would be necessary to determine
 1163  whether rates are competitive. The corporation shall file its
 1164  recommended rates with the office at least annually. The
 1165  corporation shall provide any additional information regarding
 1166  the rates which the office requires. The office shall consider
 1167  the recommendations of the board and issue a final order
 1168  establishing the rates for the corporation within 45 days after
 1169  the recommended rates are filed. The corporation may not pursue
 1170  an administrative challenge or judicial review of the final
 1171  order of the office.
 1172         2. In addition to the rates otherwise determined pursuant
 1173  to this paragraph, the corporation shall impose and collect an
 1174  amount equal to the premium tax provided in s. 624.509 to
 1175  augment the financial resources of the corporation.
 1176         3. After the public hurricane loss-projection model under
 1177  s. 627.06281 has been found to be accurate and reliable by the
 1178  Florida Commission on Hurricane Loss Projection Methodology, the
 1179  model shall be considered when establishing the windstorm
 1180  portion of the corporation’s rates. The corporation may use the
 1181  public model results in combination with the results of private
 1182  models to calculate rates for the windstorm portion of the
 1183  corporation’s rates. This subparagraph does not require or allow
 1184  the corporation to adopt rates lower than the rates otherwise
 1185  required or allowed by this paragraph.
 1186         4. The corporation must make a recommended actuarially
 1187  sound rate filing for each personal and commercial line of
 1188  business it writes.
 1189         5. Notwithstanding the board’s recommended rates and the
 1190  office’s final order regarding the corporation’s filed rates
 1191  under subparagraph 1., the corporation shall annually implement
 1192  a rate increase which, except for sinkhole coverage, does not
 1193  exceed the following for any single policy issued by the
 1194  corporation, excluding coverage changes and surcharges:
 1195         a. Eleven percent for 2022.
 1196         b. Twelve percent for 2023.
 1197         b.c. Thirteen percent for 2024.
 1198         c.d. Fourteen percent for 2025.
 1199         d.e. Fifteen percent for 2026 and all subsequent years.
 1200         6. The corporation may also implement an increase to
 1201  reflect the effect on the corporation of the cash buildup factor
 1202  pursuant to s. 215.555(5)(b).
 1203         7. The corporation’s implementation of rates as prescribed
 1204  in subparagraphs 5. and 8. subparagraph 5. shall cease for any
 1205  line of business written by the corporation upon the
 1206  corporation’s implementation of actuarially sound rates.
 1207  Thereafter, the corporation shall annually make a recommended
 1208  actuarially sound rate filing that is not competitive with
 1209  approved rates in the admitted voluntary market for each
 1210  commercial and personal line of business the corporation writes.
 1211         8.For any new or renewal personal lines policy written on
 1212  or after November 1, 2023, which does not cover a primary
 1213  residence, the rate to be applied in calculating premium is not
 1214  subject to the rate increase limitations in subparagraph 5.
 1215  However, the policyholder may not be charged more than 50
 1216  percent above, and may not be charged less than, the established
 1217  rate for the corporation which was in effect 1 year before the
 1218  date of the application.
 1219         9. As used in this paragraph, the term primary residence”
 1220  means the dwelling that is the policyholder’s primary home or is
 1221  a rental property that is the primary home of the tenant, and
 1222  which the policyholder or tenant occupies for more than 9 months
 1223  of each year.
 1224         (o) If coverage in an account, or the Citizens account if
 1225  established by the corporation, is deactivated pursuant to
 1226  paragraph (p), coverage through the corporation shall be
 1227  reactivated by order of the office only under one of the
 1228  following circumstances:
 1229         1. If the market assistance plan receives a minimum of 100
 1230  applications for coverage within a 3-month period, or 200
 1231  applications for coverage within a 1-year period or less for
 1232  residential coverage, unless the market assistance plan provides
 1233  a quotation from admitted carriers at their filed rates for at
 1234  least 90 percent of such applicants. Any market assistance plan
 1235  application that is rejected because an individual risk is so
 1236  hazardous as to be uninsurable using the criteria specified in
 1237  subparagraph (c)8. shall not be included in the minimum
 1238  percentage calculation provided herein. In the event that there
 1239  is a legal or administrative challenge to a determination by the
 1240  office that the conditions of this subparagraph have been met
 1241  for eligibility for coverage in the corporation, any eligible
 1242  risk may obtain coverage during the pendency of such challenge.
 1243         2. In response to a state of emergency declared by the
 1244  Governor under s. 252.36, the office may activate coverage by
 1245  order for the period of the emergency upon a finding by the
 1246  office that the emergency significantly affects the availability
 1247  of residential property insurance.
 1248         (p)1. The corporation shall file with the office quarterly
 1249  statements of financial condition, an annual statement of
 1250  financial condition, and audited financial statements in the
 1251  manner prescribed by law. In addition, the corporation shall
 1252  report to the office monthly on the types, premium, exposure,
 1253  and distribution by county of its policies in force, and shall
 1254  submit other reports as the office requires to carry out its
 1255  oversight of the corporation.
 1256         2. The activities of the corporation shall be reviewed at
 1257  least annually by the office to determine whether coverage shall
 1258  be deactivated in an account, or in the Citizens account if
 1259  established by the corporation, on the basis that the conditions
 1260  giving rise to its activation no longer exist.
 1261         (q)1. The corporation shall certify to the office its needs
 1262  for annual assessments as to a particular calendar year, and for
 1263  any interim assessments that it deems to be necessary to sustain
 1264  operations as to a particular year pending the receipt of annual
 1265  assessments. Upon verification, the office shall approve such
 1266  certification, and the corporation shall levy such annual or
 1267  interim assessments. Such assessments shall be prorated, if
 1268  authority to levy exists, as provided in paragraph (b). The
 1269  corporation shall take all reasonable and prudent steps
 1270  necessary to collect the amount of assessments due from each
 1271  assessable insurer, including, if prudent, filing suit to
 1272  collect the assessments, and the office may provide such
 1273  assistance to the corporation it deems appropriate. If the
 1274  corporation is unable to collect an assessment from any
 1275  assessable insurer, the uncollected assessments shall be levied
 1276  as an additional assessment against the assessable insurers and
 1277  any assessable insurer required to pay an additional assessment
 1278  as a result of such failure to pay shall have a cause of action
 1279  against such nonpaying assessable insurer. Assessments shall be
 1280  included as an appropriate factor in the making of rates. The
 1281  failure of a surplus lines agent to collect and remit any
 1282  regular or emergency assessment levied by the corporation is
 1283  considered to be a violation of s. 626.936 and subjects the
 1284  surplus lines agent to the penalties provided in that section.
 1285         2. The governing body of any unit of local government, any
 1286  residents of which are insured by the corporation, may issue
 1287  bonds as defined in s. 125.013 or s. 166.101 from time to time
 1288  to fund an assistance program, in conjunction with the
 1289  corporation, for the purpose of defraying deficits of the
 1290  corporation. In order to avoid needless and indiscriminate
 1291  proliferation, duplication, and fragmentation of such assistance
 1292  programs, any unit of local government, any residents of which
 1293  are insured by the corporation, may provide for the payment of
 1294  losses, regardless of whether or not the losses occurred within
 1295  or outside of the territorial jurisdiction of the local
 1296  government. Revenue bonds under this subparagraph may not be
 1297  issued until validated pursuant to chapter 75, unless a state of
 1298  emergency is declared by executive order or proclamation of the
 1299  Governor pursuant to s. 252.36 making such findings as are
 1300  necessary to determine that it is in the best interests of, and
 1301  necessary for, the protection of the public health, safety, and
 1302  general welfare of residents of this state and declaring it an
 1303  essential public purpose to permit certain municipalities or
 1304  counties to issue such bonds as will permit relief to claimants
 1305  and policyholders of the corporation. Any such unit of local
 1306  government may enter into such contracts with the corporation
 1307  and with any other entity created pursuant to this subsection as
 1308  are necessary to carry out this paragraph. Any bonds issued
 1309  under this subparagraph shall be payable from and secured by
 1310  moneys received by the corporation from emergency assessments
 1311  under sub-subparagraph (b)3.e. (b)3.d., and assigned and pledged
 1312  to or on behalf of the unit of local government for the benefit
 1313  of the holders of such bonds. The funds, credit, property, and
 1314  taxing power of the state or of the unit of local government
 1315  shall not be pledged for the payment of such bonds.
 1316         3.a. The corporation shall adopt one or more programs
 1317  subject to approval by the office for the reduction of both new
 1318  and renewal writings in the corporation. Beginning January 1,
 1319  2008, any program the corporation adopts for the payment of
 1320  bonuses to an insurer for each risk the insurer removes from the
 1321  corporation shall comply with s. 627.3511(2) and may not exceed
 1322  the amount referenced in s. 627.3511(2) for each risk removed.
 1323  The corporation may consider any prudent and not unfairly
 1324  discriminatory approach to reducing corporation writings, and
 1325  may adopt a credit against assessment liability or other
 1326  liability that provides an incentive for insurers to take risks
 1327  out of the corporation and to keep risks out of the corporation
 1328  by maintaining or increasing voluntary writings in counties or
 1329  areas in which corporation risks are highly concentrated and a
 1330  program to provide a formula under which an insurer voluntarily
 1331  taking risks out of the corporation by maintaining or increasing
 1332  voluntary writings will be relieved wholly or partially from
 1333  assessments under sub-subparagraph (b)3.a. However, any “take
 1334  out bonus” or payment to an insurer must be conditioned on the
 1335  property being insured for at least 5 years by the insurer,
 1336  unless canceled or nonrenewed by the policyholder. If the policy
 1337  is canceled or nonrenewed by the policyholder before the end of
 1338  the 5-year period, the amount of the take-out bonus must be
 1339  prorated for the time period the policy was insured. When the
 1340  corporation enters into a contractual agreement for a take-out
 1341  plan, the producing agent of record of the corporation policy is
 1342  entitled to retain any unearned commission on such policy, and
 1343  the insurer shall either:
 1344         (I) Pay to the producing agent of record of the policy, for
 1345  the first year, an amount which is the greater of the insurer’s
 1346  usual and customary commission for the type of policy written or
 1347  a policy fee equal to the usual and customary commission of the
 1348  corporation; or
 1349         (II) Offer to allow the producing agent of record of the
 1350  policy to continue servicing the policy for a period of not less
 1351  than 1 year and offer to pay the agent the insurer’s usual and
 1352  customary commission for the type of policy written. If the
 1353  producing agent is unwilling or unable to accept appointment by
 1354  the new insurer, the new insurer shall pay the agent in
 1355  accordance with sub-sub-subparagraph (I).
 1356         b. Any credit or exemption from regular assessments adopted
 1357  under this subparagraph shall last no longer than the 3 years
 1358  following the cancellation or expiration of the policy by the
 1359  corporation. With the approval of the office, the board may
 1360  extend such credits for an additional year if the insurer
 1361  guarantees an additional year of renewability for all policies
 1362  removed from the corporation, or for 2 additional years if the
 1363  insurer guarantees 2 additional years of renewability for all
 1364  policies so removed.
 1365         c. There shall be no credit, limitation, exemption, or
 1366  deferment from emergency assessments to be collected from
 1367  policyholders pursuant to sub-subparagraph (b)3.e. or sub
 1368  subparagraph (b)5.c. (b)3.d.
 1369         4. The plan shall provide for the deferment, in whole or in
 1370  part, of the assessment of an assessable insurer, other than an
 1371  emergency assessment collected from policyholders pursuant to
 1372  sub-subparagraph (b)3.e. or sub-subparagraph (b)5.c. (b)3.d., if
 1373  the office finds that payment of the assessment would endanger
 1374  or impair the solvency of the insurer. In the event an
 1375  assessment against an assessable insurer is deferred in whole or
 1376  in part, the amount by which such assessment is deferred may be
 1377  assessed against the other assessable insurers in a manner
 1378  consistent with the basis for assessments set forth in paragraph
 1379  (b).
 1380         5. Effective July 1, 2007, in order to evaluate the costs
 1381  and benefits of approved take-out plans, if the corporation pays
 1382  a bonus or other payment to an insurer for an approved take-out
 1383  plan, it shall maintain a record of the address or such other
 1384  identifying information on the property or risk removed in order
 1385  to track if and when the property or risk is later insured by
 1386  the corporation.
 1387         6. Any policy taken out, assumed, or removed from the
 1388  corporation is, as of the effective date of the take-out,
 1389  assumption, or removal, direct insurance issued by the insurer
 1390  and not by the corporation, even if the corporation continues to
 1391  service the policies. This subparagraph applies to policies of
 1392  the corporation and not policies taken out, assumed, or removed
 1393  from any other entity.
 1394         7. For a policy taken out, assumed, or removed from the
 1395  corporation, the insurer may, for a period of no more than 3
 1396  years, continue to use any of the corporation’s policy forms or
 1397  endorsements that apply to the policy taken out, removed, or
 1398  assumed without obtaining approval from the office for use of
 1399  such policy form or endorsement.
 1400         (v)1. Effective July 1, 2002, policies of the Residential
 1401  Property and Casualty Joint Underwriting Association become
 1402  policies of the corporation. All obligations, rights, assets and
 1403  liabilities of the association, including bonds, note and debt
 1404  obligations, and the financing documents pertaining to them
 1405  become those of the corporation as of July 1, 2002. The
 1406  corporation is not required to issue endorsements or
 1407  certificates of assumption to insureds during the remaining term
 1408  of in-force transferred policies.
 1409         2. Effective July 1, 2002, policies of the Florida
 1410  Windstorm Underwriting Association are transferred to the
 1411  corporation and become policies of the corporation. All
 1412  obligations, rights, assets, and liabilities of the association,
 1413  including bonds, note and debt obligations, and the financing
 1414  documents pertaining to them are transferred to and assumed by
 1415  the corporation on July 1, 2002. The corporation is not required
 1416  to issue endorsements or certificates of assumption to insureds
 1417  during the remaining term of in-force transferred policies.
 1418         3. The Florida Windstorm Underwriting Association and the
 1419  Residential Property and Casualty Joint Underwriting Association
 1420  shall take all actions necessary to further evidence the
 1421  transfers and provide the documents and instruments of further
 1422  assurance as may reasonably be requested by the corporation for
 1423  that purpose. The corporation shall execute assumptions and
 1424  instruments as the trustees or other parties to the financing
 1425  documents of the Florida Windstorm Underwriting Association or
 1426  the Residential Property and Casualty Joint Underwriting
 1427  Association may reasonably request to further evidence the
 1428  transfers and assumptions, which transfers and assumptions,
 1429  however, are effective on the date provided under this paragraph
 1430  whether or not, and regardless of the date on which, the
 1431  assumptions or instruments are executed by the corporation.
 1432  Subject to the relevant financing documents pertaining to their
 1433  outstanding bonds, notes, indebtedness, or other financing
 1434  obligations, the moneys, investments, receivables, choses in
 1435  action, and other intangibles of the Florida Windstorm
 1436  Underwriting Association shall be credited to the coastal
 1437  account of the corporation, and those of the personal lines
 1438  residential coverage account and the commercial lines
 1439  residential coverage account of the Residential Property and
 1440  Casualty Joint Underwriting Association shall be credited to the
 1441  personal lines account and the commercial lines account,
 1442  respectively, of the corporation.
 1443         4. Effective July 1, 2002, a new applicant for property
 1444  insurance coverage who would otherwise have been eligible for
 1445  coverage in the Florida Windstorm Underwriting Association is
 1446  eligible for coverage from the corporation as provided in this
 1447  subsection.
 1448         5. The transfer of all policies, obligations, rights,
 1449  assets, and liabilities from the Florida Windstorm Underwriting
 1450  Association to the corporation and the renaming of the
 1451  Residential Property and Casualty Joint Underwriting Association
 1452  as the corporation does not affect the coverage with respect to
 1453  covered policies as defined in s. 215.555(2)(c) provided to
 1454  these entities by the Florida Hurricane Catastrophe Fund. The
 1455  coverage provided by the fund to the Florida Windstorm
 1456  Underwriting Association based on its exposures as of June 30,
 1457  2002, and each June 30 thereafter, unless the corporation has
 1458  established the Citizens account, shall be redesignated as
 1459  coverage for the coastal account of the corporation.
 1460  Notwithstanding any other provision of law, the coverage
 1461  provided by the fund to the Residential Property and Casualty
 1462  Joint Underwriting Association based on its exposures as of June
 1463  30, 2002, and each June 30 thereafter, unless the corporation
 1464  has established the Citizens account, shall be transferred to
 1465  the personal lines account and the commercial lines account of
 1466  the corporation. Notwithstanding any other provision of law, the
 1467  coastal account, unless the corporation has established the
 1468  Citizens account, shall be treated, for all Florida Hurricane
 1469  Catastrophe Fund purposes, as if it were a separate
 1470  participating insurer with its own exposures, reimbursement
 1471  premium, and loss reimbursement. Likewise, the personal lines
 1472  and commercial lines accounts, unless the corporation has
 1473  established the Citizens account, shall be viewed together, for
 1474  all fund purposes, as if the two accounts were one and represent
 1475  a single, separate participating insurer with its own exposures,
 1476  reimbursement premium, and loss reimbursement. The coverage
 1477  provided by the fund to the corporation shall constitute and
 1478  operate as a full transfer of coverage from the Florida
 1479  Windstorm Underwriting Association and Residential Property and
 1480  Casualty Joint Underwriting Association to the corporation.
 1481         (w) Notwithstanding any other provision of law:
 1482         1. The pledge or sale of, the lien upon, and the security
 1483  interest in any rights, revenues, or other assets of the
 1484  corporation created or purported to be created pursuant to any
 1485  financing documents to secure any bonds or other indebtedness of
 1486  the corporation shall be and remain valid and enforceable,
 1487  notwithstanding the commencement of and during the continuation
 1488  of, and after, any rehabilitation, insolvency, liquidation,
 1489  bankruptcy, receivership, conservatorship, reorganization, or
 1490  similar proceeding against the corporation under the laws of
 1491  this state.
 1492         2. The proceeding does not relieve the corporation of its
 1493  obligation, or otherwise affect its ability to perform its
 1494  obligation, to continue to collect, or levy and collect,
 1495  assessments, policyholder surcharges or other surcharges under
 1496  sub-subparagraph (b)3.j. (b)3.i., or any other rights, revenues,
 1497  or other assets of the corporation pledged pursuant to any
 1498  financing documents.
 1499         3. Each such pledge or sale of, lien upon, and security
 1500  interest in, including the priority of such pledge, lien, or
 1501  security interest, any such assessments, policyholder surcharges
 1502  or other surcharges, or other rights, revenues, or other assets
 1503  which are collected, or levied and collected, after the
 1504  commencement of and during the pendency of, or after, any such
 1505  proceeding shall continue unaffected by such proceeding. As used
 1506  in this subsection, the term “financing documents” means any
 1507  agreement or agreements, instrument or instruments, or other
 1508  document or documents now existing or hereafter created
 1509  evidencing any bonds or other indebtedness of the corporation or
 1510  pursuant to which any such bonds or other indebtedness has been
 1511  or may be issued and pursuant to which any rights, revenues, or
 1512  other assets of the corporation are pledged or sold to secure
 1513  the repayment of such bonds or indebtedness, together with the
 1514  payment of interest on such bonds or such indebtedness, or the
 1515  payment of any other obligation or financial product, as defined
 1516  in the plan of operation of the corporation related to such
 1517  bonds or indebtedness.
 1518         4. Any such pledge or sale of assessments, revenues,
 1519  contract rights, or other rights or assets of the corporation
 1520  shall constitute a lien and security interest, or sale, as the
 1521  case may be, that is immediately effective and attaches to such
 1522  assessments, revenues, or contract rights or other rights or
 1523  assets, whether or not imposed or collected at the time the
 1524  pledge or sale is made. Any such pledge or sale is effective,
 1525  valid, binding, and enforceable against the corporation or other
 1526  entity making such pledge or sale, and valid and binding against
 1527  and superior to any competing claims or obligations owed to any
 1528  other person or entity, including policyholders in this state,
 1529  asserting rights in any such assessments, revenues, or contract
 1530  rights or other rights or assets to the extent set forth in and
 1531  in accordance with the terms of the pledge or sale contained in
 1532  the applicable financing documents, whether or not any such
 1533  person or entity has notice of such pledge or sale and without
 1534  the need for any physical delivery, recordation, filing, or
 1535  other action.
 1536         5. As long as the corporation has any bonds outstanding,
 1537  the corporation may not file a voluntary petition under chapter
 1538  9 of the federal Bankruptcy Code or such corresponding chapter
 1539  or sections as may be in effect, from time to time, and a public
 1540  officer or any organization, entity, or other person may not
 1541  authorize the corporation to be or become a debtor under chapter
 1542  9 of the federal Bankruptcy Code or such corresponding chapter
 1543  or sections as may be in effect, from time to time, during any
 1544  such period.
 1545         6. If ordered by a court of competent jurisdiction, the
 1546  corporation may assume policies or otherwise provide coverage
 1547  for policyholders of an insurer placed in liquidation under
 1548  chapter 631, under such forms, rates, terms, and conditions as
 1549  the corporation deems appropriate, subject to approval by the
 1550  office.
 1551         (aa) Except as otherwise provided in this paragraph, the
 1552  corporation shall not require the securing and maintaining of
 1553  flood insurance as a condition of coverage of a personal lines
 1554  residential risk. if The insured or applicant must execute
 1555  executes a form approved by the office affirming that flood
 1556  insurance is not provided by the corporation and that if flood
 1557  insurance is not secured by the applicant or insured from an
 1558  insurer other than the corporation and in addition to coverage
 1559  by the corporation, the risk will not be eligible for coverage
 1560  by the corporation covered for flood damage. A corporation
 1561  policyholder electing not to secure flood insurance and
 1562  executing a form as provided herein making a claim for water
 1563  damage against the corporation shall have the burden of proving
 1564  the damage was not caused by flooding. Notwithstanding other
 1565  provisions of this subsection, The corporation may deny coverage
 1566  of a personal lines residential risk to an applicant or insured
 1567  who refuses to secure and maintain flood insurance execute the
 1568  form described herein. The requirement to purchase flood
 1569  insurance shall be implemented as follows:
 1570         1.Except as provided in subparagraphs 2. and 3., all
 1571  personal lines residential policyholders must have flood
 1572  coverage in place for policies effective on or after:
 1573         a.January 1, 2024, for property valued at $600,000 or
 1574  more.
 1575         b.January 1, 2025, for property valued at $500,000 or
 1576  more.
 1577         c.January 1, 2026, for property valued at $400,000 or
 1578  more.
 1579         d.January 1, 2027, for all other personal lines
 1580  residential property insured by the corporation.
 1581         2.All personal lines residential policyholders whose
 1582  property insured by the corporation is located within the
 1583  special flood hazard area defined by the Federal Emergency
 1584  Management Agency must have flood coverage in place:
 1585         a.At the time of initial policy issuance for all new
 1586  personal lines residential policies issued by the corporation on
 1587  or after April 1, 2023.
 1588         b.By the time of the policy renewal for allpersonal lines
 1589  residential policies renewing on or after July 1, 2023.
 1590         3.Policyholders whose policies issued by the corporation
 1591  do not provide coverage for the peril of wind are not required
 1592  to purchase flood insurance as a condition for maintaining their
 1593  policies with the corporation.
 1594  
 1595  The flood insurance required under this paragraph must meet, at
 1596  a minimum, the coverage available from the National Flood
 1597  Insurance Program or the requirements of subparagraphs s.
 1598  627.715(1)(a)1., 2., and 3.
 1599         (ii) The corporation shall revise the programs adopted
 1600  pursuant to sub-subparagraph (q)3.a. for personal lines
 1601  residential policies to maximize policyholder options and
 1602  encourage increased participation by insurers and agents. After
 1603  January 1, 2017, a policy may not be taken out of the
 1604  corporation unless the provisions of this paragraph are met.
 1605         1. The corporation must publish a periodic schedule of
 1606  cycles during which an insurer may identify, and notify the
 1607  corporation of, policies that the insurer is requesting to take
 1608  out. A request must include a description of the coverage
 1609  offered and an estimated premium and must be submitted to the
 1610  corporation in a form and manner prescribed by the corporation.
 1611         2. The corporation must maintain and make available to the
 1612  agent of record a consolidated list of all insurers requesting
 1613  to take out a policy. The list must include a description of the
 1614  coverage offered and the estimated premium for each take-out
 1615  request.
 1616         3. If a policyholder receives a take-out offer from an
 1617  authorized insurer, the risk is no longer eligible for coverage
 1618  with the corporation unless the premium for coverage from the
 1619  authorized insurer is more 20 percent greater than the renewal
 1620  premium for comparable coverage from the corporation pursuant to
 1621  sub-subparagraph (c)5.c. This subparagraph applies to take-out
 1622  offers that are part of an application to participate in
 1623  depopulation submitted to the office on or after January 1,
 1624  2023.
 1625         4. The corporation must provide written notice to the
 1626  policyholder and the agent of record regarding all insurers
 1627  requesting to take out the policy and regarding the
 1628  policyholder’s option to accept a take-out offer or to reject
 1629  all take-out offers and to remain with the corporation. The
 1630  notice must be in a format prescribed by the corporation and
 1631  include, for each take-out offer:
 1632         a. The amount of the estimated premium;
 1633         b. A description of the coverage; and
 1634         c. A comparison of the estimated premium and coverage
 1635  offered by the insurer to the estimated premium and coverage
 1636  provided by the corporation.
 1637         (kk)A corporation policyholder making a claim for water
 1638  damage against the corporation has the burden of proving that
 1639  the damage was not caused by flooding.
 1640         Section 9. Paragraph (s) of subsection (6) of section
 1641  627.351, Florida Statutes, is amended to read:
 1642         627.351 Insurance risk apportionment plans.—
 1643         (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
 1644         (s)1. There shall be no liability on the part of, and no
 1645  cause of action of any nature shall arise against, any
 1646  assessable insurer or its agents or employees, the corporation
 1647  or its agents or employees, members of the board of governors or
 1648  their respective designees at a board meeting, corporation
 1649  committee members, or the office or its representatives, for any
 1650  action taken by them in the performance of their duties or
 1651  responsibilities under this subsection. Such immunity does not
 1652  apply to:
 1653         a. Any of the foregoing persons or entities for any willful
 1654  tort;
 1655         b. The corporation or its producing agents for breach of
 1656  any contract or agreement pertaining to insurance coverage;
 1657         c. The corporation with respect to issuance or payment of
 1658  debt;
 1659         d. Any assessable insurer with respect to any action to
 1660  enforce an assessable insurer’s obligations to the corporation
 1661  under this subsection; or
 1662         e. The corporation in any pending or future action for
 1663  breach of contract or for benefits under a policy issued by the
 1664  corporation; in any such action, the corporation shall be liable
 1665  to the policyholders and beneficiaries for attorney’s fees under
 1666  s. 627.428.
 1667         2. The corporation shall manage its claim employees,
 1668  independent adjusters, and others who handle claims to ensure
 1669  they carry out the corporation’s duty to its policyholders to
 1670  handle claims carefully, timely, diligently, and in good faith,
 1671  balanced against the corporation’s duty to the state to manage
 1672  its assets responsibly to minimize its assessment potential.
 1673         Section 10. Paragraphs (b) and (c) of subsection (3) and
 1674  paragraphs (d), (e), and (f) of subsection (6) of section
 1675  627.3511, Florida Statutes, are amended to read:
 1676         627.3511 Depopulation of Citizens Property Insurance
 1677  Corporation.—
 1678         (3) EXEMPTION FROM DEFICIT ASSESSMENTS.—
 1679         (b) An insurer that first wrote personal lines residential
 1680  property coverage in this state on or after July 1, 1994, is
 1681  exempt from regular deficit assessments imposed pursuant to s.
 1682  627.351(6)(b)3.a., but not emergency assessments collected from
 1683  policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1684  627.351(6)(b)3.d., of the Citizens Property Insurance
 1685  Corporation until the earlier of the following:
 1686         1. The end of the calendar year in which it first wrote 0.5
 1687  percent or more of the statewide aggregate direct written
 1688  premium for any line of residential property coverage; or
 1689         2. December 31, 1997, or December 31 of the third year in
 1690  which it wrote such coverage in this state, whichever is later.
 1691         (c) Other than an insurer that is exempt under paragraph
 1692  (b), an insurer that in any calendar year increases its total
 1693  structure exposure subject to wind coverage by 25 percent or
 1694  more over its exposure for the preceding calendar year is, with
 1695  respect to that year, exempt from deficit assessments imposed
 1696  pursuant to s. 627.351(6)(b)3.a., but not emergency assessments
 1697  collected from policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1698  627.351(6)(b)3.d., of the Citizens Property Insurance
 1699  Corporation attributable to such increase in exposure.
 1700         (6) COMMERCIAL RESIDENTIAL TAKE-OUT PLANS.—
 1701         (d) The calculation of an insurer’s regular assessment
 1702  liability under s. 627.351(6)(b)3.a., but not emergency
 1703  assessments collected from policyholders pursuant to s.
 1704  627.351(6)(b)3.e. s. 627.351(6)(b)3.d., shall, with respect to
 1705  commercial residential policies removed from the corporation
 1706  under an approved take-out plan, exclude such removed policies
 1707  for the succeeding 3 years, as follows:
 1708         1. In the first year following removal of the policies, the
 1709  policies are excluded from the calculation to the extent of 100
 1710  percent.
 1711         2. In the second year following removal of the policies,
 1712  the policies are excluded from the calculation to the extent of
 1713  75 percent.
 1714         3. In the third year following removal of the policies, the
 1715  policies are excluded from the calculation to the extent of 50
 1716  percent.
 1717         (e) An insurer that first wrote commercial residential
 1718  property coverage in this state on or after June 1, 1996, is
 1719  exempt from regular assessments under s. 627.351(6)(b)3.a., but
 1720  not emergency assessments collected from policyholders pursuant
 1721  to s. 627.351(6)(b)3.e. s. 627.351(6)(b)3.d., with respect to
 1722  commercial residential policies until the earlier of:
 1723         1. The end of the calendar year in which such insurer first
 1724  wrote 0.5 percent or more of the statewide aggregate direct
 1725  written premium for commercial residential property coverage; or
 1726         2. December 31 of the third year in which such insurer
 1727  wrote commercial residential property coverage in this state.
 1728         (f) An insurer that is not otherwise exempt from regular
 1729  assessments under s. 627.351(6)(b)3.a. with respect to
 1730  commercial residential policies is, for any calendar year in
 1731  which such insurer increased its total commercial residential
 1732  hurricane exposure by 25 percent or more over its exposure for
 1733  the preceding calendar year, exempt from regular assessments
 1734  under s. 627.351(6)(b)3.a., but not emergency assessments
 1735  collected from policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1736  627.351(6)(b)3.d., attributable to such increased exposure.
 1737         Section 11. Effective January 1, 2023, subsection (5) of
 1738  section 627.3518, Florida Statutes, is amended to read:
 1739         627.3518 Citizens Property Insurance Corporation
 1740  policyholder eligibility clearinghouse program.—The purpose of
 1741  this section is to provide a framework for the corporation to
 1742  implement a clearinghouse program by January 1, 2014.
 1743         (5) Notwithstanding s. 627.3517, any applicant for new
 1744  coverage from the corporation is not eligible for coverage from
 1745  the corporation if provided an offer of coverage from an
 1746  authorized insurer through the program at a premium that is at
 1747  or below the eligibility threshold for applicants for new
 1748  coverage established in s. 627.351(6)(c)5.a. Whenever an offer
 1749  of coverage for a personal lines risk is received for a
 1750  policyholder of the corporation at renewal from an authorized
 1751  insurer through the program which is at or below the eligibility
 1752  threshold for policyholders of the corporation established in s.
 1753  627.351(6)(c)5.a., if the offer is equal to or less than the
 1754  corporation’s renewal premium for comparable coverage, the risk
 1755  is not eligible for coverage with the corporation. In the event
 1756  an offer of coverage for a new applicant is received from an
 1757  authorized insurer through the program, and the premium offered
 1758  exceeds the eligibility threshold for applicants for new
 1759  coverage established contained in s. 627.351(6)(c)5.a., the
 1760  applicant or insured may elect to accept such coverage, or may
 1761  elect to accept or continue coverage with the corporation. In
 1762  the event an offer of coverage for a personal lines risk is
 1763  received from an authorized insurer at renewal through the
 1764  program, and the premium offered exceeds the eligibility
 1765  threshold for policyholders of the corporation established in s.
 1766  627.351(6)(c)5.a. is more than the corporation’s renewal premium
 1767  for comparable coverage, the insured may elect to accept such
 1768  coverage, or may elect to accept or continue coverage with the
 1769  corporation. Section 627.351(6)(c)5.a.(I) does not apply to an
 1770  offer of coverage from an authorized insurer obtained through
 1771  the program. An applicant for coverage from the corporation who
 1772  was declared ineligible for coverage at renewal by the
 1773  corporation in the previous 36 months due to an offer of
 1774  coverage pursuant to this subsection shall be considered a
 1775  renewal under this section if the corporation determines that
 1776  the authorized insurer making the offer of coverage pursuant to
 1777  this subsection continues to insure the applicant and increased
 1778  the rate on the policy in excess of the increase allowed for the
 1779  corporation under s. 627.351(6)(n)5.
 1780         Section 12. Subsection (3) of section 627.410, Florida
 1781  Statutes, is amended to read:
 1782         627.410 Filing, approval of forms.—
 1783         (3) The office may, for cause, withdraw a previous
 1784  approval. No insurer shall issue or use any form disapproved by
 1785  the office, or as to which the office has withdrawn approval,
 1786  after the effective date of the order of the office. Based on a
 1787  finding from a market conduct examination of a property insurer
 1788  that the insurer has exhibited a pattern or practice of one or
 1789  more willful unfair insurance trade practice violations with
 1790  regard to its use of appraisal, the office shall reexamine the
 1791  insurer’s property insurance policy forms that contain an
 1792  appraisal clause, and the office may:
 1793         (a)Withdraw approval of the forms, if warranted by the
 1794  Florida Insurance Code.
 1795         (b)In addition to any regulatory action under ss. 624.418
 1796  and 624.4211, issue an order prohibiting the insurer from
 1797  invoking appraisal for up to 2 years.
 1798         Section 13. Subsections (1) and (4) of section 627.428,
 1799  Florida Statutes, are amended to read:
 1800         627.428 Attorney fees.—
 1801         (1) Except as provided in subsection (4), upon the
 1802  rendition of a judgment or decree by any of the courts of this
 1803  state against an insurer and in favor of any named or omnibus
 1804  insured or the named beneficiary under a policy or contract
 1805  executed by the insurer, the trial court or, in the event of an
 1806  appeal in which the insured or beneficiary prevails, the
 1807  appellate court shall adjudge or decree against the insurer and
 1808  in favor of the insured or beneficiary a reasonable sum as fees
 1809  or compensation for the insured’s or beneficiary’s attorney
 1810  prosecuting the suit in which the recovery is had. In a suit
 1811  arising under a residential or commercial property insurance
 1812  policy, the amount of reasonable attorney fees shall be awarded
 1813  only as provided in s. 57.105 or s. 627.70152, as applicable.
 1814         (4) In a suit arising under a residential or commercial
 1815  property insurance policy, there is no the right to attorney
 1816  fees under this section may not be transferred to, assigned to,
 1817  or acquired in any other manner by anyone other than a named or
 1818  omnibus insured or a named beneficiary.
 1819         Section 14. Paragraph (b) of subsection (4) of section
 1820  627.7011, Florida Statutes, is amended to read:
 1821         627.7011 Homeowners’ policies; offer of replacement cost
 1822  coverage and law and ordinance coverage.—
 1823         (4)
 1824         (b) An insurer that issues a homeowner’s insurance policy
 1825  that does not provide flood insurance coverage must include on
 1826  the policy declarations page with the policy documents at
 1827  initial issuance and every renewal, in bold type no smaller than
 1828  18 points, the following statement:
 1829  
 1830         “FLOOD INSURANCE: YOU SHOULD MAY ALSO NEED TO CONSIDER
 1831         THE PURCHASE OF FLOOD INSURANCE. YOUR HOMEOWNER’S
 1832         INSURANCE POLICY DOES NOT INCLUDE COVERAGE FOR DAMAGE
 1833         RESULTING FROM FLOOD EVEN IF HURRICANE WINDS AND RAIN
 1834         CAUSED THE FLOOD TO OCCUR. WITHOUT SEPARATE FLOOD
 1835         INSURANCE COVERAGE, YOUR YOU MAY HAVE UNCOVERED LOSSES
 1836         CAUSED BY FLOOD ARE NOT COVERED. PLEASE DISCUSS THE
 1837         NEED TO PURCHASE SEPARATE FLOOD INSURANCE COVERAGE
 1838         WITH YOUR INSURANCE AGENT.”
 1839  
 1840         Section 15. Effective March 1, 2023, present subsection (8)
 1841  of section 627.70131, Florida Statutes, is redesignated as
 1842  subsection (9), a new subsection (8) is added to that section,
 1843  and paragraph (a) of subsection (1), subsections (3), (4), and
 1844  (5), and paragraph (a) of subsection (7) of that section are
 1845  amended, to read:
 1846         627.70131 Insurer’s duty to acknowledge communications
 1847  regarding claims; investigation.—
 1848         (1)(a) Upon an insurer’s receiving a communication with
 1849  respect to a claim, the insurer shall, within 7 14 calendar
 1850  days, review and acknowledge receipt of such communication
 1851  unless payment is made within that period of time or unless the
 1852  failure to acknowledge is caused by factors beyond the control
 1853  of the insurer which reasonably prevent such acknowledgment. If
 1854  the acknowledgment is not in writing, a notification indicating
 1855  acknowledgment shall be made in the insurer’s claim file and
 1856  dated. A communication made to or by a representative of an
 1857  insurer with respect to a claim shall constitute communication
 1858  to or by the insurer.
 1859         (3)(a) Unless otherwise provided by the policy of insurance
 1860  or by law, within 7 14 days after an insurer receives proof-of
 1861  loss statements, the insurer shall begin such investigation as
 1862  is reasonably necessary unless the failure to begin such
 1863  investigation is caused by factors beyond the control of the
 1864  insurer which reasonably prevent the commencement of such
 1865  investigation.
 1866         (b) If such investigation involves a physical inspection of
 1867  the property, the licensed adjuster assigned by the insurer must
 1868  provide the policyholder with a printed or electronic document
 1869  containing his or her name and state adjuster license number.
 1870  For claims other than those subject to a hurricane deductible,
 1871  An insurer must conduct any such physical inspection within 30
 1872  45 days after its receipt of the proof-of-loss statements.
 1873         (c) Any subsequent communication with the policyholder
 1874  regarding the claim must also include the name and license
 1875  number of the adjuster communicating about the claim.
 1876  Communication of the adjuster’s name and license number may be
 1877  included with other information provided to the policyholder.
 1878         (d) An insurer may use electronic methods to investigate
 1879  the loss. Such electronic methods may include any method that
 1880  provides the insurer with clear, color pictures or video
 1881  documenting the loss, including, but not limited to, electronic
 1882  photographs or video recordings of the loss, video conferencing
 1883  between the adjuster and the policyholder which includes video
 1884  recording of the loss, and video recordings or photographs of
 1885  the loss using a drone, driverless vehicle, or other machine
 1886  that can move independently or through remote control. The
 1887  insurer also may allow the policyholder to use such methods to
 1888  assist in the investigation of the loss. An insurer may void the
 1889  insurance policy if the policyholder or any other person at the
 1890  direction of the policyholder, with intent to injure, defraud,
 1891  or deceive any insurer, commits insurance fraud by providing
 1892  false, incomplete, or misleading information concerning any fact
 1893  or thing material to a claim using electronic methods. The use
 1894  of electronic methods to investigate the loss does not prohibit
 1895  an insurer from assigning a licensed adjuster to physically
 1896  inspect the property.
 1897         (e)Within 7 days after the insurer’s assignment of an
 1898  adjuster to the claim, The insurer must send notify the
 1899  policyholder that he or she may request a copy of any detailed
 1900  estimate of the amount of the loss within 7 days after the
 1901  estimate is generated by an insurer’s adjuster. After receiving
 1902  such a request from the policyholder, the insurer must send any
 1903  such detailed estimate to the policyholder within the later of 7
 1904  days after the insurer received the request or 7 days after the
 1905  detailed estimate of the amount of the loss is completed. This
 1906  paragraph does not require that an insurer create a detailed
 1907  estimate of the amount of the loss if such estimate is not
 1908  reasonably necessary as part of the claim investigation.
 1909         (4) An insurer shall maintain:
 1910         (a) A record or log of each adjuster who communicates with
 1911  the policyholder as provided in paragraphs (3)(b) and (c) and
 1912  provide a list of such adjusters to the insured, office, or
 1913  department upon request.
 1914         (b)Claim records, including dates, of:
 1915         1.Any claim-related communication made between the insurer
 1916  and the policyholder or the policyholder’s representative;
 1917         2.The insurer’s receipt of the policyholder’s proof of
 1918  loss statement;
 1919         3.Any claim-related request for information made by the
 1920  insurer to the policyholder or the policyholder’s
 1921  representative;
 1922         4.Any claim-related inspections of the property made by
 1923  the insurer, including physical inspections and inspections made
 1924  by electronic means;
 1925         5.Any detailed estimate of the amount of the loss
 1926  generated by the insurer’s adjuster;
 1927         6.The beginning and end of any tolling period provided for
 1928  in subsection (8); and
 1929         7.The insurer’s payment or denial of the claim.
 1930         (5) For purposes of this section, the term:
 1931         (a)“Factors beyond the control of the insurer” means:
 1932         1.Any of the following events that is the basis for the
 1933  office issuing an order finding that such event renders all or
 1934  specified residential property insurers reasonably unable to
 1935  meet the requirements of this section in specified locations and
 1936  ordering that such insurer or insurers may have additional time
 1937  as specified by the office to comply with the requirements of
 1938  this section: a state of emergency declared by the Governor
 1939  under s. 252.36, a breach of security that must be reported
 1940  under s. 501.171(3), or an information technology issue. The
 1941  office may not extend the period for payment or denial of a
 1942  claim for more than 30 additional days.
 1943         2.Actions by the policyholder or the policyholder’s
 1944  representative which constitute fraud, lack of cooperation, or
 1945  intentional misrepresentation regarding the claim for which
 1946  benefits are owed when such actions reasonably prevent the
 1947  insurer from complying with any requirement of this section.
 1948         (b) “Insurer” means any residential property insurer.
 1949         (7)(a) Within 45 90 days after an insurer receives notice
 1950  of an initial, reopened, or supplemental property insurance
 1951  claim from a policyholder, the insurer shall pay or deny such
 1952  claim or a portion of the claim unless the failure to pay is
 1953  caused by factors beyond the control of the insurer which
 1954  reasonably prevent such payment. The insurer shall provide a
 1955  reasonable explanation in writing to the policyholder of the
 1956  basis in the insurance policy, in relation to the facts or
 1957  applicable law, for the payment, denial, or partial denial of a
 1958  claim. If the insurer’s claim payment is less than specified in
 1959  any insurer’s detailed estimate of the amount of the loss, the
 1960  insurer must provide a reasonable explanation in writing of the
 1961  difference to the policyholder. Any payment of an initial or
 1962  supplemental claim or portion of such claim made 45 90 days
 1963  after the insurer receives notice of the claim, or made more
 1964  than 15 days after the expiration of any additional timeframe
 1965  provided to pay or deny a claim or a portion of a claim made
 1966  pursuant to an order of the office finding there are no longer
 1967  factors beyond the control of the insurer which reasonably
 1968  prevented such payment, whichever is later, bears interest at
 1969  the rate set forth in s. 55.03. Interest begins to accrue from
 1970  the date the insurer receives notice of the claim. The
 1971  provisions of this subsection may not be waived, voided, or
 1972  nullified by the terms of the insurance policy. If there is a
 1973  right to prejudgment interest, the insured must select whether
 1974  to receive prejudgment interest or interest under this
 1975  subsection. Interest is payable when the claim or portion of the
 1976  claim is paid. Failure to comply with this subsection
 1977  constitutes a violation of this code. However, failure to comply
 1978  with this subsection does not form the sole basis for a private
 1979  cause of action.
 1980         (8)The requirements of this section are tolled:
 1981         (a)During the pendency of any mediation proceeding under
 1982  s. 627.7015 or any alternative dispute resolution proceeding
 1983  provided for in the insurance contract. The tolling period ends
 1984  upon the end of the mediation or alternative dispute resolution
 1985  proceeding.
 1986         (b)Upon the failure of a policyholder or a representative
 1987  of the policyholder to provide material claims information
 1988  requested by the insurer within 10 days after the request was
 1989  received. The tolling period ends upon the insurer’s receipt of
 1990  the requested information. Tolling under this paragraph applies
 1991  only to requests sent by the insurer to the policyholder or a
 1992  representative of the policyholder at least 15 days before the
 1993  insurer is required to pay or deny the claim or a portion of the
 1994  claim under subsection (7).
 1995         Section 16. Subsection (2) of section 627.70132, Florida
 1996  Statutes, is amended to read:
 1997         627.70132 Notice of property insurance claim.—
 1998         (2) A claim or reopened claim, but not a supplemental
 1999  claim, under an insurance policy that provides property
 2000  insurance, as defined in s. 624.604, including a property
 2001  insurance policy issued by an eligible surplus lines insurer,
 2002  for loss or damage caused by any peril is barred unless notice
 2003  of the claim was given to the insurer in accordance with the
 2004  terms of the policy within 1 year 2 years after the date of
 2005  loss. A supplemental claim is barred unless notice of the
 2006  supplemental claim was given to the insurer in accordance with
 2007  the terms of the policy within 18 months 3 years after the date
 2008  of loss.
 2009         Section 17. Subsections (1), (2), (6), and (8) of section
 2010  627.70152, Florida Statutes, are amended to read:
 2011         627.70152 Suits arising under a property insurance policy.—
 2012         (1) APPLICATION.—This section applies exclusively to all
 2013  suits not brought by an assignee arising under a residential or
 2014  commercial property insurance policy, including a residential or
 2015  commercial property insurance policy issued by an eligible
 2016  surplus lines insurer.
 2017         (2) DEFINITIONS.—As used in this section, the term:
 2018         (a) “Amount obtained” means damages recovered, if any, but
 2019  the term does not include any amount awarded for attorney fees,
 2020  costs, or interest.
 2021         (b) “Claimant” means an insured who is filing suit under a
 2022  residential or commercial property insurance policy.
 2023         (b)(c) “Disputed amount” means the difference between the
 2024  claimant’s presuit settlement demand, not including attorney
 2025  fees and costs listed in the demand, and the insurer’s presuit
 2026  settlement offer, not including attorney fees and costs, if part
 2027  of the offer.
 2028         (c)(d) “Presuit settlement demand” means the demand made by
 2029  the claimant in the written notice of intent to initiate
 2030  litigation as required by paragraph (3)(a). The demand must
 2031  include the amount of reasonable and necessary attorney fees and
 2032  costs incurred by the claimant, to be calculated by multiplying
 2033  the number of hours actually worked on the claim by the
 2034  claimant’s attorney as of the date of the notice by a reasonable
 2035  hourly rate.
 2036         (d)(e) “Presuit settlement offer” means the offer made by
 2037  the insurer in its written response to the notice as required by
 2038  subsection (3).
 2039         (6) ADMISSIBILITY OF NOTICE AND RESPONSE.—The notice
 2040  provided pursuant to subsection (3) and, if applicable, the
 2041  documentation to support the information provided in the notice:
 2042         (a) Are not admissible as evidence only in any a proceeding
 2043  regarding attorney fees.
 2044         (b) Do not limit the evidence of attorney fees or costs,
 2045  damages, or loss which may be offered at trial.
 2046         (c) Do not relieve any obligation that an insured or
 2047  assignee has to give notice under any other provision of law.
 2048         (8) ATTORNEY FEES.—
 2049         (a) In a suit arising under a residential or commercial
 2050  property insurance policy not brought by an assignee, the amount
 2051  of reasonable attorney fees and costs under s. 626.9373(1) or s.
 2052  627.428(1) shall be calculated and awarded as follows:
 2053         1. If the difference between the amount obtained by the
 2054  claimant and the presuit settlement offer, excluding reasonable
 2055  attorney fees and costs, is less than 20 percent of the disputed
 2056  amount, each party pays its own attorney fees and costs and a
 2057  claimant may not be awarded attorney fees under s. 626.9373(1)
 2058  or s. 627.428(1).
 2059         2. If the difference between the amount obtained by the
 2060  claimant and the presuit settlement offer, excluding reasonable
 2061  attorney fees and costs, is at least 20 percent but less than 50
 2062  percent of the disputed amount, the insurer pays the claimant’s
 2063  attorney fees and costs under s. 626.9373(1) or s. 627.428(1)
 2064  equal to the percentage of the disputed amount obtained times
 2065  the total attorney fees and costs.
 2066         3. If the difference between the amount obtained by the
 2067  claimant and the presuit settlement offer, excluding reasonable
 2068  attorney fees and costs, is at least 50 percent of the disputed
 2069  amount, the insurer pays the claimant’s full attorney fees and
 2070  costs under s. 626.9373(1) or s. 627.428(1).
 2071         (b) In a suit arising under a residential or commercial
 2072  property insurance policy not brought by an assignee, if a court
 2073  dismisses a claimant’s suit pursuant to subsection (5), the
 2074  court may not award to the claimant any incurred attorney fees
 2075  for services rendered before the dismissal of the suit. When a
 2076  claimant’s suit is dismissed pursuant to subsection (5), the
 2077  court may award to the insurer reasonable attorney fees and
 2078  costs associated with securing the dismissal.
 2079         (c) In awarding attorney fees under this subsection, a
 2080  strong presumption is created that a lodestar fee is sufficient
 2081  and reasonable. Such presumption may be rebutted only in a rare
 2082  and exceptional circumstance with evidence that competent
 2083  counsel could not be retained in a reasonable manner.
 2084         Section 18. Section 627.70154, Florida Statutes, is created
 2085  to read:
 2086         627.70154 Mandatory binding arbitration.—A property
 2087  insurance policy issued in this state may not require that a
 2088  policyholder participate in mandatory binding arbitration unless
 2089  all of the following apply:
 2090         (1)The mandatory binding arbitration requirements are
 2091  contained in a separate endorsement attached to the property
 2092  insurance policy.
 2093         (2)The premium that a policyholder is charged for the
 2094  policy includes an actuarially sound credit or premium discount
 2095  for the mandatory binding arbitration endorsement.
 2096         (3)The policyholder signs a form electing to accept
 2097  mandatory binding arbitration. The form must notify the
 2098  policyholder of the rights given up in exchange for the credit
 2099  or premium discount, including, but not limited to, the right to
 2100  a trial by jury.
 2101         (4)The endorsement establishes that an insurer will comply
 2102  with the mediation provisions set forth in s. 627.7015 before
 2103  the initiation of arbitration.
 2104         (5)The insurer also offers the policyholder a policy that
 2105  does not require that the policyholder participate in mandatory
 2106  binding arbitration.
 2107         Section 19. Subsections (9), (14), and (15) of section
 2108  627.7074, Florida Statutes, are amended to read:
 2109         627.7074 Alternative procedure for resolution of disputed
 2110  sinkhole insurance claims.—
 2111         (9) Evidence of an offer to settle a claim during the
 2112  neutral evaluation process, as well as any relevant conduct or
 2113  statements made in negotiations concerning the offer to settle a
 2114  claim, is inadmissible to prove liability or absence of
 2115  liability for the claim or its value, except as provided in
 2116  subsection (14).
 2117         (14) If the neutral evaluator verifies the existence of a
 2118  sinkhole that caused structural damage and recommends the need
 2119  for and estimates costs of stabilizing the land and any covered
 2120  buildings and other appropriate remediation or building repairs
 2121  which exceed the amount that the insurer has offered to pay the
 2122  policyholder, the insurer is liable to the policyholder for up
 2123  to $2,500 in attorney’s fees for the attorney’s participation in
 2124  the neutral evaluation process. For purposes of this subsection,
 2125  the term “offer to pay” means a written offer signed by the
 2126  insurer or its legal representative and delivered to the
 2127  policyholder within 10 days after the insurer receives notice
 2128  that a request for neutral evaluation has been made under this
 2129  section.
 2130         (15) If the insurer timely agrees in writing to comply and
 2131  timely complies with the recommendation of the neutral
 2132  evaluator, but the policyholder declines to resolve the matter
 2133  in accordance with the recommendation of the neutral evaluator
 2134  pursuant to this section:
 2135         (a) The insurer is not liable for extracontractual damages
 2136  related to a claim for a sinkhole loss but only as related to
 2137  the issues determined by the neutral evaluation process. This
 2138  section does not affect or impair claims for extracontractual
 2139  damages unrelated to the issues determined by the neutral
 2140  evaluation process contained in this section; and
 2141         (b) The actions of the insurer are not a confession of
 2142  judgment or admission of liability, and the insurer is not
 2143  liable for attorney’s fees under s. 627.428 or other provisions
 2144  of the insurance code unless the policyholder obtains a judgment
 2145  that is more favorable than the recommendation of the neutral
 2146  evaluator.
 2147         Section 20. Effective March 1, 2023, section 627.7142,
 2148  Florida Statutes, is amended to read:
 2149         627.7142 Homeowner Claims Bill of Rights.—An insurer
 2150  issuing a personal lines residential property insurance policy
 2151  in this state must provide a Homeowner Claims Bill of Rights to
 2152  a policyholder within 14 days after receiving an initial
 2153  communication with respect to a claim. The purpose of the bill
 2154  of rights is to summarize, in simple, nontechnical terms,
 2155  existing Florida law regarding the rights of a personal lines
 2156  residential property insurance policyholder who files a claim of
 2157  loss. The Homeowner Claims Bill of Rights is specific to the
 2158  claims process and does not represent all of a policyholder’s
 2159  rights under Florida law regarding the insurance policy. The
 2160  Homeowner Claims Bill of Rights does not create a civil cause of
 2161  action by any individual policyholder or class of policyholders
 2162  against an insurer or insurers. The failure of an insurer to
 2163  properly deliver the Homeowner Claims Bill of Rights is subject
 2164  to administrative enforcement by the office but is not
 2165  admissible as evidence in a civil action against an insurer. The
 2166  Homeowner Claims Bill of Rights does not enlarge, modify, or
 2167  contravene statutory requirements, including, but not limited
 2168  to, ss. 626.854, 626.9541, 627.70131, 627.7015, and 627.7074,
 2169  and does not prohibit an insurer from exercising its right to
 2170  repair damaged property in compliance with the terms of an
 2171  applicable policy or ss. 627.7011(6)(e) and 627.702(7). The
 2172  Homeowner Claims Bill of Rights must state:
 2173  
 2174                          HOMEOWNER CLAIMS                         
 2175                           BILL OF RIGHTS                          
 2176         This Bill of Rights is specific to the claims process
 2177         and does not represent all of your rights under
 2178         Florida law regarding your policy. There are also
 2179         exceptions to the stated timelines when conditions are
 2180         beyond your insurance company’s control. This document
 2181         does not create a civil cause of action by an
 2182         individual policyholder, or a class of policyholders,
 2183         against an insurer or insurers and does not prohibit
 2184         an insurer from exercising its right to repair damaged
 2185         property in compliance with the terms of an applicable
 2186         policy.
 2187  
 2188         YOU HAVE THE RIGHT TO:
 2189         1. Receive from your insurance company an
 2190         acknowledgment of your reported claim within 7 14 days
 2191         after the time you communicated the claim.
 2192         2. Upon written request, receive from your
 2193         insurance company within 30 days after you have
 2194         submitted a complete proof-of-loss statement to your
 2195         insurance company, confirmation that your claim is
 2196         covered in full, partially covered, or denied, or
 2197         receive a written statement that your claim is being
 2198         investigated.
 2199         3. Receive from your insurance company a copy of
 2200         any detailed estimate of the amount of the loss within
 2201         7 days after the estimate is generated by the
 2202         insurance company’s adjuster.
 2203         4. Within 45 90 days, subject to any dual
 2204         interest noted in the policy, receive full settlement
 2205         payment for your claim or payment of the undisputed
 2206         portion of your claim, or your insurance company’s
 2207         denial of your claim.
 2208         5.4. Receive payment of interest, as provided in
 2209         s. 627.70131, Florida Statutes, from your insurance
 2210         company, which begins accruing from the date your
 2211         claim is filed if your insurance company does not pay
 2212         full settlement of your initial, reopened, or
 2213         supplemental claim or the undisputed portion of your
 2214         claim or does not deny your claim within 45 90 days