Florida Senate - 2022                          SENATOR AMENDMENT
       Bill No. SB 2-A
       
       
       
       
       
       
                                Ì847224$Î847224                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
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                Floor: 8/F/2R          .                                
             12/13/2022 02:56 PM       .                                
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       Senator Polsky moved the following:
       
    1         Senate Amendment (with title amendment)
    2         Delete lines 613 - 2578
    3  and insert:
    4         5.Repeated failure to comply with s. 627.70131(7)(a).
    5         Section 8. Effective January 1, 2023, paragraphs (b), (c),
    6  (n), (o), (p), (q), (v), (w), (aa), and (ii) of subsection (6)
    7  of section 627.351, Florida Statutes, are amended, and paragraph
    8  (kk) is added to that subsection, to read:
    9         627.351 Insurance risk apportionment plans.—
   10         (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
   11         (b)1. All insurers authorized to write one or more subject
   12  lines of business in this state are subject to assessment by the
   13  corporation and, for the purposes of this subsection, are
   14  referred to collectively as “assessable insurers.” Insurers
   15  writing one or more subject lines of business in this state
   16  pursuant to part VIII of chapter 626 are not assessable
   17  insurers; however, insureds who procure one or more subject
   18  lines of business in this state pursuant to part VIII of chapter
   19  626 are subject to assessment by the corporation and are
   20  referred to collectively as “assessable insureds.” An insurer’s
   21  assessment liability begins on the first day of the calendar
   22  year following the year in which the insurer was issued a
   23  certificate of authority to transact insurance for subject lines
   24  of business in this state and terminates 1 year after the end of
   25  the first calendar year during which the insurer no longer holds
   26  a certificate of authority to transact insurance for subject
   27  lines of business in this state.
   28         2.a. All revenues, assets, liabilities, losses, and
   29  expenses of the corporation shall be divided into three separate
   30  accounts as follows:
   31         (I) A personal lines account for personal residential
   32  policies issued by the corporation which provides comprehensive,
   33  multiperil coverage on risks that are not located in areas
   34  eligible for coverage by the Florida Windstorm Underwriting
   35  Association as those areas were defined on January 1, 2002, and
   36  for policies that do not provide coverage for the peril of wind
   37  on risks that are located in such areas;
   38         (II) A commercial lines account for commercial residential
   39  and commercial nonresidential policies issued by the corporation
   40  which provides coverage for basic property perils on risks that
   41  are not located in areas eligible for coverage by the Florida
   42  Windstorm Underwriting Association as those areas were defined
   43  on January 1, 2002, and for policies that do not provide
   44  coverage for the peril of wind on risks that are located in such
   45  areas; and
   46         (III) A coastal account for personal residential policies
   47  and commercial residential and commercial nonresidential
   48  property policies issued by the corporation which provides
   49  coverage for the peril of wind on risks that are located in
   50  areas eligible for coverage by the Florida Windstorm
   51  Underwriting Association as those areas were defined on January
   52  1, 2002. The corporation may offer policies that provide
   53  multiperil coverage and shall offer policies that provide
   54  coverage only for the peril of wind for risks located in areas
   55  eligible for coverage in the coastal account. Effective July 1,
   56  2014, the corporation shall cease offering new commercial
   57  residential policies providing multiperil coverage and shall
   58  instead continue to offer commercial residential wind-only
   59  policies, and may offer commercial residential policies
   60  excluding wind. The corporation may, however, continue to renew
   61  a commercial residential multiperil policy on a building that is
   62  insured by the corporation on June 30, 2014, under a multiperil
   63  policy. In issuing multiperil coverage, the corporation may use
   64  its approved policy forms and rates for the personal lines
   65  account. An applicant or insured who is eligible to purchase a
   66  multiperil policy from the corporation may purchase a multiperil
   67  policy from an authorized insurer without prejudice to the
   68  applicant’s or insured’s eligibility to prospectively purchase a
   69  policy that provides coverage only for the peril of wind from
   70  the corporation. An applicant or insured who is eligible for a
   71  corporation policy that provides coverage only for the peril of
   72  wind may elect to purchase or retain such policy and also
   73  purchase or retain coverage excluding wind from an authorized
   74  insurer without prejudice to the applicant’s or insured’s
   75  eligibility to prospectively purchase a policy that provides
   76  multiperil coverage from the corporation. It is the goal of the
   77  Legislature that there be an overall average savings of 10
   78  percent or more for a policyholder who currently has a wind-only
   79  policy with the corporation, and an ex-wind policy with a
   80  voluntary insurer or the corporation, and who obtains a
   81  multiperil policy from the corporation. It is the intent of the
   82  Legislature that the offer of multiperil coverage in the coastal
   83  account be made and implemented in a manner that does not
   84  adversely affect the tax-exempt status of the corporation or
   85  creditworthiness of or security for currently outstanding
   86  financing obligations or credit facilities of the coastal
   87  account, the personal lines account, or the commercial lines
   88  account. The coastal account must also include quota share
   89  primary insurance under subparagraph (c)2. The area eligible for
   90  coverage under the coastal account also includes the area within
   91  Port Canaveral, which is bordered on the south by the City of
   92  Cape Canaveral, bordered on the west by the Banana River, and
   93  bordered on the north by Federal Government property.
   94         b. The three separate accounts must be maintained as long
   95  as financing obligations entered into by the Florida Windstorm
   96  Underwriting Association or Residential Property and Casualty
   97  Joint Underwriting Association are outstanding, in accordance
   98  with the terms of the corresponding financing documents. If no
   99  such financing obligations remain outstanding or if the
  100  financing documents allow for combining of accounts, the
  101  corporation may consolidate the three separate accounts into a
  102  new account, to be known as the Citizens account, for all
  103  revenues, assets, liabilities, losses, and expenses of the
  104  corporation. The Citizens account, if established by the
  105  corporation, is authorized to provide coverage to the same
  106  extent as provided under each of the three separate accounts.
  107  The authority to provide coverage under the Citizens account is
  108  set forth in subparagraph 4. If the financing obligations are no
  109  longer outstanding, the corporation may use a single account for
  110  all revenues, assets, liabilities, losses, and expenses of the
  111  corporation. Consistent with this subparagraph and prudent
  112  investment policies that minimize the cost of carrying debt, the
  113  board shall exercise its best efforts to retire existing debt or
  114  obtain the approval of necessary parties to amend the terms of
  115  existing debt, so as to structure the most efficient plan for
  116  consolidating the three separate accounts into a single account.
  117  Once the accounts are combined into one account, this
  118  subparagraph and subparagraph 3. shall be replaced in their
  119  entirety by subparagraphs 4. and 5.
  120         c. Creditors of the Residential Property and Casualty Joint
  121  Underwriting Association and the accounts specified in sub-sub
  122  subparagraphs a.(I) and (II) may have a claim against, and
  123  recourse to, those accounts and no claim against, or recourse
  124  to, the account referred to in sub-sub-subparagraph a.(III).
  125  Creditors of the Florida Windstorm Underwriting Association have
  126  a claim against, and recourse to, the account referred to in
  127  sub-sub-subparagraph a.(III) and no claim against, or recourse
  128  to, the accounts referred to in sub-sub-subparagraphs a.(I) and
  129  (II).
  130         d. Revenues, assets, liabilities, losses, and expenses not
  131  attributable to particular accounts shall be prorated among the
  132  accounts.
  133         e. The Legislature finds that the revenues of the
  134  corporation are revenues that are necessary to meet the
  135  requirements set forth in documents authorizing the issuance of
  136  bonds under this subsection.
  137         f. The income of the corporation may not inure to the
  138  benefit of any private person.
  139         3. With respect to a deficit in an account:
  140         a. After accounting for the Citizens policyholder surcharge
  141  imposed under sub-subparagraph i., if the remaining projected
  142  deficit incurred in the coastal account in a particular calendar
  143  year:
  144         (I) Is not greater than 2 percent of the aggregate
  145  statewide direct written premium for the subject lines of
  146  business for the prior calendar year, the entire deficit shall
  147  be recovered through regular assessments of assessable insurers
  148  under paragraph (q) and assessable insureds.
  149         (II) Exceeds 2 percent of the aggregate statewide direct
  150  written premium for the subject lines of business for the prior
  151  calendar year, the corporation shall levy regular assessments on
  152  assessable insurers under paragraph (q) and on assessable
  153  insureds in an amount equal to the greater of 2 percent of the
  154  projected deficit or 2 percent of the aggregate statewide direct
  155  written premium for the subject lines of business for the prior
  156  calendar year. Any remaining projected deficit shall be
  157  recovered through emergency assessments under sub-subparagraph
  158  e. d.
  159         b. Each assessable insurer’s share of the amount being
  160  assessed under sub-subparagraph a. must be in the proportion
  161  that the assessable insurer’s direct written premium for the
  162  subject lines of business for the year preceding the assessment
  163  bears to the aggregate statewide direct written premium for the
  164  subject lines of business for that year. The assessment
  165  percentage applicable to each assessable insured is the ratio of
  166  the amount being assessed under sub-subparagraph a. to the
  167  aggregate statewide direct written premium for the subject lines
  168  of business for the prior year. Assessments levied by the
  169  corporation on assessable insurers under sub-subparagraph a.
  170  must be paid as required by the corporation’s plan of operation
  171  and paragraph (q). Assessments levied by the corporation on
  172  assessable insureds under sub-subparagraph a. shall be collected
  173  by the surplus lines agent at the time the surplus lines agent
  174  collects the surplus lines tax required by s. 626.932, and paid
  175  to the Florida Surplus Lines Service Office at the time the
  176  surplus lines agent pays the surplus lines tax to that office.
  177  Upon receipt of regular assessments from surplus lines agents,
  178  the Florida Surplus Lines Service Office shall transfer the
  179  assessments directly to the corporation as determined by the
  180  corporation.
  181         c. The corporation may not levy regular assessments under
  182  paragraph (q) pursuant to sub-subparagraph a. or sub
  183  subparagraph b. if the three separate accounts in sub-sub
  184  subparagraphs 2.a.(I)-(III) have been consolidated into the
  185  Citizens account pursuant to sub-subparagraph 2.b. However, the
  186  outstanding balance of any regular assessment levied by the
  187  corporation before establishment of the Citizens account remains
  188  payable to the corporation.
  189         d. After accounting for the Citizens policyholder surcharge
  190  imposed under sub-subparagraph j. i., the remaining projected
  191  deficits in the personal lines account and in the commercial
  192  lines account in a particular calendar year shall be recovered
  193  through emergency assessments under sub-subparagraph e. d.
  194         e.d. Upon a determination by the board of governors that a
  195  projected deficit in an account exceeds the amount that is
  196  expected to be recovered through regular assessments under sub
  197  subparagraph a., plus the amount that is expected to be
  198  recovered through surcharges under sub-subparagraph j. i., the
  199  board, after verification by the office, shall levy emergency
  200  assessments for as many years as necessary to cover the
  201  deficits, to be collected by assessable insurers and the
  202  corporation and collected from assessable insureds upon issuance
  203  or renewal of policies for subject lines of business, excluding
  204  National Flood Insurance policies. The amount collected in a
  205  particular year must be a uniform percentage of that year’s
  206  direct written premium for subject lines of business and all
  207  accounts of the corporation, excluding National Flood Insurance
  208  Program policy premiums, as annually determined by the board and
  209  verified by the office. The office shall verify the arithmetic
  210  calculations involved in the board’s determination within 30
  211  days after receipt of the information on which the determination
  212  was based. The office shall notify assessable insurers and the
  213  Florida Surplus Lines Service Office of the date on which
  214  assessable insurers shall begin to collect and assessable
  215  insureds shall begin to pay such assessment. The date must be at
  216  least 90 days after the date the corporation levies emergency
  217  assessments pursuant to this sub-subparagraph. Notwithstanding
  218  any other provision of law, the corporation and each assessable
  219  insurer that writes subject lines of business shall collect
  220  emergency assessments from its policyholders without such
  221  obligation being affected by any credit, limitation, exemption,
  222  or deferment. Emergency assessments levied by the corporation on
  223  assessable insureds shall be collected by the surplus lines
  224  agent at the time the surplus lines agent collects the surplus
  225  lines tax required by s. 626.932 and paid to the Florida Surplus
  226  Lines Service Office at the time the surplus lines agent pays
  227  the surplus lines tax to that office. The emergency assessments
  228  collected shall be transferred directly to the corporation on a
  229  periodic basis as determined by the corporation and held by the
  230  corporation solely in the applicable account. The aggregate
  231  amount of emergency assessments levied for an account in any
  232  calendar year may be less than but may not exceed the greater of
  233  10 percent of the amount needed to cover the deficit, plus
  234  interest, fees, commissions, required reserves, and other costs
  235  associated with financing the original deficit, or 10 percent of
  236  the aggregate statewide direct written premium for subject lines
  237  of business and all accounts of the corporation for the prior
  238  year, plus interest, fees, commissions, required reserves, and
  239  other costs associated with financing the deficit.
  240         f.e. The corporation may pledge the proceeds of
  241  assessments, projected recoveries from the Florida Hurricane
  242  Catastrophe Fund, other insurance and reinsurance recoverables,
  243  policyholder surcharges and other surcharges, and other funds
  244  available to the corporation as the source of revenue for and to
  245  secure bonds issued under paragraph (q), bonds or other
  246  indebtedness issued under subparagraph (c)3., or lines of credit
  247  or other financing mechanisms issued or created under this
  248  subsection, or to retire any other debt incurred as a result of
  249  deficits or events giving rise to deficits, or in any other way
  250  that the board determines will efficiently recover such
  251  deficits. The purpose of the lines of credit or other financing
  252  mechanisms is to provide additional resources to assist the
  253  corporation in covering claims and expenses attributable to a
  254  catastrophe. As used in this subsection, the term “assessments”
  255  includes regular assessments under sub-subparagraph a. or
  256  subparagraph (q)1. and emergency assessments under sub
  257  subparagraph e. d. Emergency assessments collected under sub
  258  subparagraph e. d. are not part of an insurer’s rates, are not
  259  premium, and are not subject to premium tax, fees, or
  260  commissions; however, failure to pay the emergency assessment
  261  shall be treated as failure to pay premium. The emergency
  262  assessments shall continue as long as any bonds issued or other
  263  indebtedness incurred with respect to a deficit for which the
  264  assessment was imposed remain outstanding, unless adequate
  265  provision has been made for the payment of such bonds or other
  266  indebtedness pursuant to the documents governing such bonds or
  267  indebtedness.
  268         g.f. As used in this subsection for purposes of any deficit
  269  incurred on or after January 25, 2007, the term “subject lines
  270  of business” means insurance written by assessable insurers or
  271  procured by assessable insureds for all property and casualty
  272  lines of business in this state, but not including workers’
  273  compensation or medical malpractice. As used in this sub
  274  subparagraph, the term “property and casualty lines of business”
  275  includes all lines of business identified on Form 2, Exhibit of
  276  Premiums and Losses, in the annual statement required of
  277  authorized insurers under s. 624.424 and any rule adopted under
  278  this section, except for those lines identified as accident and
  279  health insurance and except for policies written under the
  280  National Flood Insurance Program or the Federal Crop Insurance
  281  Program. For purposes of this sub-subparagraph, the term
  282  “workers’ compensation” includes both workers’ compensation
  283  insurance and excess workers’ compensation insurance.
  284         h.g. The Florida Surplus Lines Service Office shall
  285  determine annually the aggregate statewide written premium in
  286  subject lines of business procured by assessable insureds and
  287  report that information to the corporation in a form and at a
  288  time the corporation specifies to ensure that the corporation
  289  can meet the requirements of this subsection and the
  290  corporation’s financing obligations.
  291         i.h. The Florida Surplus Lines Service Office shall verify
  292  the proper application by surplus lines agents of assessment
  293  percentages for regular assessments and emergency assessments
  294  levied under this subparagraph on assessable insureds and assist
  295  the corporation in ensuring the accurate, timely collection and
  296  payment of assessments by surplus lines agents as required by
  297  the corporation.
  298         j.i. Upon determination by the board of governors that an
  299  account has a projected deficit, the board shall levy a Citizens
  300  policyholder surcharge against all policyholders of the
  301  corporation.
  302         (I) The surcharge shall be levied as a uniform percentage
  303  of the premium for the policy of up to 15 percent of such
  304  premium, which funds shall be used to offset the deficit.
  305         (II) The surcharge is payable upon cancellation or
  306  termination of the policy, upon renewal of the policy, or upon
  307  issuance of a new policy by the corporation within the first 12
  308  months after the date of the levy or the period of time
  309  necessary to fully collect the surcharge amount.
  310         (III) The corporation may not levy any regular assessments
  311  under paragraph (q) pursuant to sub-subparagraph a. or sub
  312  subparagraph b. with respect to a particular year’s deficit
  313  until the corporation has first levied the full amount of the
  314  surcharge authorized by this sub-subparagraph.
  315         (IV) The surcharge is not considered premium and is not
  316  subject to commissions, fees, or premium taxes. However, failure
  317  to pay the surcharge shall be treated as failure to pay premium.
  318         k.j. If the amount of any assessments or surcharges
  319  collected from corporation policyholders, assessable insurers or
  320  their policyholders, or assessable insureds exceeds the amount
  321  of the deficits, such excess amounts shall be remitted to and
  322  retained by the corporation in a reserve to be used by the
  323  corporation, as determined by the board of governors and
  324  approved by the office, to pay claims or reduce any past,
  325  present, or future plan-year deficits or to reduce outstanding
  326  debt.
  327         4.The Citizens account, if established by the corporation
  328  pursuant to sub-subparagraph 2.b., is authorized to provide:
  329         a.Personal residential policies that provide
  330  comprehensive, multiperil coverage on risks that are not located
  331  in areas eligible for coverage by the Florida Windstorm
  332  Underwriting Association, as those areas were defined on January
  333  1, 2002, and for policies that do not provide coverage for the
  334  peril of wind on risks that are located in such areas;
  335         b.Commercial residential and commercial nonresidential
  336  policies that provide coverage for basic property perils on
  337  risks that are not located in areas eligible for coverage by the
  338  Florida Windstorm Underwriting Association, as those areas were
  339  defined on January 1, 2002, and for policies that do not provide
  340  coverage for the peril of wind on risks that are located in such
  341  areas; and
  342         c.Personal residential policies and commercial residential
  343  and commercial nonresidential property policies that provide
  344  coverage for the peril of wind on risks that are located in
  345  areas eligible for coverage by the Florida Windstorm
  346  Underwriting Association, as those areas were defined on January
  347  1, 2002. The corporation may offer policies that provide
  348  multiperil coverage and shall offer policies that provide
  349  coverage only for the peril of wind for risks located in areas
  350  eligible for coverage by the Florida Windstorm Underwriting
  351  Association, as those areas were defined on January 1, 2002. The
  352  corporation may not offer new commercial residential policies
  353  providing multiperil coverage, but shall continue to offer
  354  commercial residential wind-only policies, and may offer
  355  commercial residential policies excluding wind. However, the
  356  corporation may continue to renew a commercial residential
  357  multiperil policy on a building that was insured by the
  358  corporation on June 30, 2014, under a multiperil policy. In
  359  issuing multiperil coverage under this sub-subparagraph, the
  360  corporation may use its approved policy forms and rates for
  361  risks located in areas not eligible for coverage by the Florida
  362  Windstorm Underwriting Association as those areas were defined
  363  on January 1, 2002, and for policies that do not provide
  364  coverage for the peril of wind on risks that are located in such
  365  areas. An applicant or insured who is eligible to purchase a
  366  multiperil policy from the corporation may purchase a multiperil
  367  policy from an authorized insurer without prejudice to the
  368  applicant’s or insured’s eligibility to prospectively purchase a
  369  policy that provides coverage only for the peril of wind from
  370  the corporation. An applicant or insured who is eligible for a
  371  corporation policy that provides coverage only for the peril of
  372  wind may elect to purchase or retain such policy and also
  373  purchase or retain coverage excluding wind from an authorized
  374  insurer without prejudice to the applicant’s or insured’s
  375  eligibility to prospectively purchase a policy that provides
  376  multiperil coverage from the corporation. The following
  377  policies, which provide coverage only for the peril of wind,
  378  must also include quota share primary insurance under
  379  subparagraph (c)2.: Personal residential policies and commercial
  380  residential and commercial nonresidential property policies that
  381  provide coverage for the peril of wind on risks that are located
  382  in areas eligible for coverage by the Florida Windstorm
  383  Underwriting Association, as those areas were defined on January
  384  1, 2002; policies that provide multiperil coverage, if offered
  385  by the corporation, and policies that provide coverage only for
  386  the peril of wind for risks located in areas eligible for
  387  coverage by the Florida Windstorm Underwriting Association, as
  388  those areas were defined on January 1, 2002; commercial
  389  residential wind-only policies; commercial residential policies
  390  excluding wind, if offered by the corporation; and commercial
  391  residential multiperil policies on a building that was insured
  392  by the corporation on June 30, 2014. The area eligible for
  393  coverage with the corporation under this sub-subparagraph
  394  includes the area within Port Canaveral, which is bordered on
  395  the south by the City of Cape Canaveral, bordered on the west by
  396  the Banana River, and bordered on the north by Federal
  397  Government property.
  398         5.With respect to a deficit in the Citizens account:
  399         a.Upon a determination by the board of governors that the
  400  Citizens account has a projected deficit, the board shall levy a
  401  Citizens policyholder surcharge against all policyholders of the
  402  corporation.
  403         (I) The surcharge shall be levied as a uniform percentage
  404  of the premium for the policy of up to 15 percent of such
  405  premium, which funds shall be used to offset the deficit.
  406         (II) The surcharge is payable upon cancellation or
  407  termination of the policy, upon renewal of the policy, or upon
  408  issuance of a new policy by the corporation within the first 12
  409  months after the date of the levy or the period of time
  410  necessary to fully collect the surcharge amount.
  411         (III)The surcharge is not considered premium and is not
  412  subject to commissions, fees, or premium taxes. However, failure
  413  to pay the surcharge shall be treated as failure to pay premium.
  414         b. After accounting for the Citizens policyholder surcharge
  415  imposed under sub-subparagraph a., the remaining projected
  416  deficit incurred in the Citizens account in a particular
  417  calendar year shall be recovered through emergency assessments
  418  under sub-subparagraph c.
  419         c.Upon a determination by the board of governors that a
  420  projected deficit in the Citizens account exceeds the amount
  421  that is expected to be recovered through surcharges under sub
  422  subparagraph a., the board, after verification by the office,
  423  shall levy emergency assessments for as many years as necessary
  424  to cover the deficits, to be collected by assessable insurers
  425  and the corporation and collected from assessable insureds upon
  426  issuance or renewal of policies for subject lines of business,
  427  excluding National Flood Insurance Program policies. The amount
  428  collected in a particular year must be a uniform percentage of
  429  that year’s direct written premium for subject lines of business
  430  and the Citizens account, National Flood Insurance Program
  431  policy premiums, as annually determined by the board and
  432  verified by the office. The office shall verify the arithmetic
  433  calculations involved in the board’s determination within 30
  434  days after receipt of the information on which the determination
  435  was based. The office shall notify assessable insurers and the
  436  Florida Surplus Lines Service Office of the date on which
  437  assessable insurers shall begin to collect and assessable
  438  insureds shall begin to pay such assessment. The date must be at
  439  least 90 days after the date the corporation levies emergency
  440  assessments pursuant to this sub-subparagraph. Notwithstanding
  441  any other law, the corporation and each assessable insurer that
  442  writes subject lines of business shall collect emergency
  443  assessments from its policyholders without such obligation being
  444  affected by any credit, limitation, exemption, or deferment.
  445  Emergency assessments levied by the corporation on assessable
  446  insureds shall be collected by the surplus lines agent at the
  447  time the surplus lines agent collects the surplus lines tax
  448  required by s. 626.932 and paid to the Florida Surplus Lines
  449  Service Office at the time the surplus lines agent pays the
  450  surplus lines tax to that office. The emergency assessments
  451  collected shall be transferred directly to the corporation on a
  452  periodic basis as determined by the corporation and held by the
  453  corporation solely in the Citizens account. The aggregate amount
  454  of emergency assessments levied for the Citizens account in any
  455  calendar year may be less than, but may not exceed the greater
  456  of, 10 percent of the amount needed to cover the deficit, plus
  457  interest, fees, commissions, required reserves, and other costs
  458  associated with financing the original deficit or 10 percent of
  459  the aggregate statewide direct written premium for subject lines
  460  of business and the Citizens accounts for the prior year, plus
  461  interest, fees, commissions, required reserves, and other costs
  462  associated with financing the deficit.
  463         d.The corporation may pledge the proceeds of assessments,
  464  projected recoveries from the Florida Hurricane Catastrophe
  465  Fund, other insurance and reinsurance recoverables, policyholder
  466  surcharges and other surcharges, and other funds available to
  467  the corporation as the source of revenue for and to secure bonds
  468  issued under paragraph (q), bonds or other indebtedness issued
  469  under subparagraph (c)3., or lines of credit or other financing
  470  mechanisms issued or created under this subsection; or to retire
  471  any other debt incurred as a result of deficits or events giving
  472  rise to deficits, or in any other way that the board determines
  473  will efficiently recover such deficits. The purpose of the lines
  474  of credit or other financing mechanisms is to provide additional
  475  resources to assist the corporation in covering claims and
  476  expenses attributable to a catastrophe. As used in this
  477  subsection, the term “assessments” includes emergency
  478  assessments under sub-subparagraph c. Emergency assessments
  479  collected under sub-subparagraph c. are not part of an insurer’s
  480  rates, are not premium, and are not subject to premium tax,
  481  fees, or commissions; however, failure to pay the emergency
  482  assessment shall be treated as failure to pay premium. The
  483  emergency assessments shall continue as long as any bonds issued
  484  or other indebtedness incurred with respect to a deficit for
  485  which the assessment was imposed remain outstanding, unless
  486  adequate provision has been made for the payment of such bonds
  487  or other indebtedness pursuant to the documents governing such
  488  bonds or indebtedness.
  489         e.As used in this subsection and for purposes of any
  490  deficit incurred on or after January 25, 2007, the term “subject
  491  lines of business” means insurance written by assessable
  492  insurers or procured by assessable insureds for all property and
  493  casualty lines of business in this state, but not including
  494  workers’ compensation or medical malpractice. As used in this
  495  sub-subparagraph, the term “property and casualty lines of
  496  business” includes all lines of business identified on Form 2,
  497  Exhibit of Premiums and Losses, in the annual statement required
  498  of authorized insurers under s. 624.424 and any rule adopted
  499  under this section, except for those lines identified as
  500  accident and health insurance and except for policies written
  501  under the National Flood Insurance Program or the Federal Crop
  502  Insurance Program. For purposes of this sub-subparagraph, the
  503  term “workers’ compensation” includes both workers’ compensation
  504  insurance and excess workers’ compensation insurance.
  505         f.The Florida Surplus Lines Service Office shall annually
  506  determine the aggregate statewide written premium in subject
  507  lines of business procured by assessable insureds and report
  508  that information to the corporation in a form and at a time the
  509  corporation specifies to ensure that the corporation can meet
  510  the requirements of this subsection and the corporation’s
  511  financing obligations.
  512         g.The Florida Surplus Lines Service Office shall verify
  513  the proper application by surplus lines agents of assessment
  514  percentages for emergency assessments levied under this
  515  subparagraph on assessable insureds and assist the corporation
  516  in ensuring the accurate, timely collection and payment of
  517  assessments by surplus lines agents as required by the
  518  corporation.
  519         h.If the amount of any assessments or surcharges collected
  520  from corporation policyholders, assessable insurers or their
  521  policyholders, or assessable insureds exceeds the amount of the
  522  deficits, such excess amounts shall be remitted to and retained
  523  by the corporation in a reserve to be used by the corporation,
  524  as determined by the board of governors and approved by the
  525  office, to pay claims or reduce any past, present, or future
  526  plan-year deficits or to reduce outstanding debt.
  527         (c) The corporation’s plan of operation:
  528         1. Must provide for adoption of residential property and
  529  casualty insurance policy forms and commercial residential and
  530  nonresidential property insurance forms, which must be approved
  531  by the office before use. The corporation shall adopt the
  532  following policy forms:
  533         a. Standard personal lines policy forms that are
  534  comprehensive multiperil policies providing full coverage of a
  535  residential property equivalent to the coverage provided in the
  536  private insurance market under an HO-3, HO-4, or HO-6 policy.
  537         b. Basic personal lines policy forms that are policies
  538  similar to an HO-8 policy or a dwelling fire policy that provide
  539  coverage meeting the requirements of the secondary mortgage
  540  market, but which is more limited than the coverage under a
  541  standard policy.
  542         c. Commercial lines residential and nonresidential policy
  543  forms that are generally similar to the basic perils of full
  544  coverage obtainable for commercial residential structures and
  545  commercial nonresidential structures in the admitted voluntary
  546  market.
  547         d. Personal lines and commercial lines residential property
  548  insurance forms that cover the peril of wind only. The forms are
  549  applicable only to residential properties located in areas
  550  eligible for coverage by the Florida Windstorm Underwriting
  551  Association, as those areas were defined on January 1, 2002
  552  under the coastal account referred to in sub-subparagraph
  553  (b)2.a.
  554         e. Commercial lines nonresidential property insurance forms
  555  that cover the peril of wind only. The forms are applicable only
  556  to nonresidential properties located in areas eligible for
  557  coverage by the Florida Windstorm Underwriting Association, as
  558  those areas were defined on January 1, 2002 under the coastal
  559  account referred to in sub-subparagraph (b)2.a.
  560         f. The corporation may adopt variations of the policy forms
  561  listed in sub-subparagraphs a.-e. which contain more restrictive
  562  coverage.
  563         g. Effective January 1, 2013, The corporation shall offer a
  564  basic personal lines policy similar to an HO-8 policy with
  565  dwelling repair based on common construction materials and
  566  methods.
  567         2. Must provide that the corporation adopt a program in
  568  which the corporation and authorized insurers enter into quota
  569  share primary insurance agreements for hurricane coverage, as
  570  defined in s. 627.4025(2)(a), for eligible risks, and adopt
  571  property insurance forms for eligible risks which cover the
  572  peril of wind only.
  573         a. As used in this subsection, the term:
  574         (I) “Quota share primary insurance” means an arrangement in
  575  which the primary hurricane coverage of an eligible risk is
  576  provided in specified percentages by the corporation and an
  577  authorized insurer. The corporation and authorized insurer are
  578  each solely responsible for a specified percentage of hurricane
  579  coverage of an eligible risk as set forth in a quota share
  580  primary insurance agreement between the corporation and an
  581  authorized insurer and the insurance contract. The
  582  responsibility of the corporation or authorized insurer to pay
  583  its specified percentage of hurricane losses of an eligible
  584  risk, as set forth in the agreement, may not be altered by the
  585  inability of the other party to pay its specified percentage of
  586  losses. Eligible risks that are provided hurricane coverage
  587  through a quota share primary insurance arrangement must be
  588  provided policy forms that set forth the obligations of the
  589  corporation and authorized insurer under the arrangement,
  590  clearly specify the percentages of quota share primary insurance
  591  provided by the corporation and authorized insurer, and
  592  conspicuously and clearly state that the authorized insurer and
  593  the corporation may not be held responsible beyond their
  594  specified percentage of coverage of hurricane losses.
  595         (II) “Eligible risks” means personal lines residential and
  596  commercial lines residential risks that meet the underwriting
  597  criteria of the corporation and are located in areas that were
  598  eligible for coverage by the Florida Windstorm Underwriting
  599  Association on January 1, 2002.
  600         b. The corporation may enter into quota share primary
  601  insurance agreements with authorized insurers at corporation
  602  coverage levels of 90 percent and 50 percent.
  603         c. If the corporation determines that additional coverage
  604  levels are necessary to maximize participation in quota share
  605  primary insurance agreements by authorized insurers, the
  606  corporation may establish additional coverage levels. However,
  607  the corporation’s quota share primary insurance coverage level
  608  may not exceed 90 percent.
  609         d. Any quota share primary insurance agreement entered into
  610  between an authorized insurer and the corporation must provide
  611  for a uniform specified percentage of coverage of hurricane
  612  losses, by county or territory as set forth by the corporation
  613  board, for all eligible risks of the authorized insurer covered
  614  under the agreement.
  615         e. Any quota share primary insurance agreement entered into
  616  between an authorized insurer and the corporation is subject to
  617  review and approval by the office. However, such agreement shall
  618  be authorized only as to insurance contracts entered into
  619  between an authorized insurer and an insured who is already
  620  insured by the corporation for wind coverage.
  621         f. For all eligible risks covered under quota share primary
  622  insurance agreements, the exposure and coverage levels for both
  623  the corporation and authorized insurers shall be reported by the
  624  corporation to the Florida Hurricane Catastrophe Fund. For all
  625  policies of eligible risks covered under such agreements, the
  626  corporation and the authorized insurer must maintain complete
  627  and accurate records for the purpose of exposure and loss
  628  reimbursement audits as required by fund rules. The corporation
  629  and the authorized insurer shall each maintain duplicate copies
  630  of policy declaration pages and supporting claims documents.
  631         g. The corporation board shall establish in its plan of
  632  operation standards for quota share agreements which ensure that
  633  there is no discriminatory application among insurers as to the
  634  terms of the agreements, pricing of the agreements, incentive
  635  provisions if any, and consideration paid for servicing policies
  636  or adjusting claims.
  637         h. The quota share primary insurance agreement between the
  638  corporation and an authorized insurer must set forth the
  639  specific terms under which coverage is provided, including, but
  640  not limited to, the sale and servicing of policies issued under
  641  the agreement by the insurance agent of the authorized insurer
  642  producing the business, the reporting of information concerning
  643  eligible risks, the payment of premium to the corporation, and
  644  arrangements for the adjustment and payment of hurricane claims
  645  incurred on eligible risks by the claims adjuster and personnel
  646  of the authorized insurer. Entering into a quota sharing
  647  insurance agreement between the corporation and an authorized
  648  insurer is voluntary and at the discretion of the authorized
  649  insurer.
  650         3. May provide that the corporation may employ or otherwise
  651  contract with individuals or other entities to provide
  652  administrative or professional services that may be appropriate
  653  to effectuate the plan. The corporation may borrow funds by
  654  issuing bonds or by incurring other indebtedness, and shall have
  655  other powers reasonably necessary to effectuate the requirements
  656  of this subsection, including, without limitation, the power to
  657  issue bonds and incur other indebtedness in order to refinance
  658  outstanding bonds or other indebtedness. The corporation may
  659  seek judicial validation of its bonds or other indebtedness
  660  under chapter 75. The corporation may issue bonds or incur other
  661  indebtedness, or have bonds issued on its behalf by a unit of
  662  local government pursuant to subparagraph (q)2. in the absence
  663  of a hurricane or other weather-related event, upon a
  664  determination by the corporation, subject to approval by the
  665  office, that such action would enable it to efficiently meet the
  666  financial obligations of the corporation and that such
  667  financings are reasonably necessary to effectuate the
  668  requirements of this subsection. The corporation may take all
  669  actions needed to facilitate tax-free status for such bonds or
  670  indebtedness, including formation of trusts or other affiliated
  671  entities. The corporation may pledge assessments, projected
  672  recoveries from the Florida Hurricane Catastrophe Fund, other
  673  reinsurance recoverables, policyholder surcharges and other
  674  surcharges, and other funds available to the corporation as
  675  security for bonds or other indebtedness. In recognition of s.
  676  10, Art. I of the State Constitution, prohibiting the impairment
  677  of obligations of contracts, it is the intent of the Legislature
  678  that no action be taken whose purpose is to impair any bond
  679  indenture or financing agreement or any revenue source committed
  680  by contract to such bond or other indebtedness.
  681         4. Must require that the corporation operate subject to the
  682  supervision and approval of a board of governors consisting of
  683  nine individuals who are residents of this state and who are
  684  from different geographical areas of the state, one of whom is
  685  appointed by the Governor and serves solely to advocate on
  686  behalf of the consumer. The appointment of a consumer
  687  representative by the Governor is deemed to be within the scope
  688  of the exemption provided in s. 112.313(7)(b) and is in addition
  689  to the appointments authorized under sub-subparagraph a.
  690         a. The Governor, the Chief Financial Officer, the President
  691  of the Senate, and the Speaker of the House of Representatives
  692  shall each appoint two members of the board. At least one of the
  693  two members appointed by each appointing officer must have
  694  demonstrated expertise in insurance and be deemed to be within
  695  the scope of the exemption provided in s. 112.313(7)(b). The
  696  Chief Financial Officer shall designate one of the appointees as
  697  chair. All board members serve at the pleasure of the appointing
  698  officer. All members of the board are subject to removal at will
  699  by the officers who appointed them. All board members, including
  700  the chair, must be appointed to serve for 3-year terms beginning
  701  annually on a date designated by the plan. However, for the
  702  first term beginning on or after July 1, 2009, each appointing
  703  officer shall appoint one member of the board for a 2-year term
  704  and one member for a 3-year term. A board vacancy shall be
  705  filled for the unexpired term by the appointing officer. The
  706  Chief Financial Officer shall appoint a technical advisory group
  707  to provide information and advice to the board in connection
  708  with the board’s duties under this subsection. The executive
  709  director and senior managers of the corporation shall be engaged
  710  by the board and serve at the pleasure of the board. Any
  711  executive director appointed on or after July 1, 2006, is
  712  subject to confirmation by the Senate. The executive director is
  713  responsible for employing other staff as the corporation may
  714  require, subject to review and concurrence by the board.
  715         b. The board shall create a Market Accountability Advisory
  716  Committee to assist the corporation in developing awareness of
  717  its rates and its customer and agent service levels in
  718  relationship to the voluntary market insurers writing similar
  719  coverage.
  720         (I) The members of the advisory committee consist of the
  721  following 11 persons, one of whom must be elected chair by the
  722  members of the committee: four representatives, one appointed by
  723  the Florida Association of Insurance Agents, one by the Florida
  724  Association of Insurance and Financial Advisors, one by the
  725  Professional Insurance Agents of Florida, and one by the Latin
  726  American Association of Insurance Agencies; three
  727  representatives appointed by the insurers with the three highest
  728  voluntary market share of residential property insurance
  729  business in the state; one representative from the Office of
  730  Insurance Regulation; one consumer appointed by the board who is
  731  insured by the corporation at the time of appointment to the
  732  committee; one representative appointed by the Florida
  733  Association of Realtors; and one representative appointed by the
  734  Florida Bankers Association. All members shall be appointed to
  735  3-year terms and may serve for consecutive terms.
  736         (II) The committee shall report to the corporation at each
  737  board meeting on insurance market issues which may include rates
  738  and rate competition with the voluntary market; service,
  739  including policy issuance, claims processing, and general
  740  responsiveness to policyholders, applicants, and agents; and
  741  matters relating to depopulation.
  742         5. Must provide a procedure for determining the eligibility
  743  of a risk for coverage, as follows:
  744         a. Subject to s. 627.3517, with respect to personal lines
  745  residential risks, if the risk is offered coverage from an
  746  authorized insurer at the insurer’s approved rate under a
  747  standard policy including wind coverage or, if consistent with
  748  the insurer’s underwriting rules as filed with the office, a
  749  basic policy including wind coverage, for a new application to
  750  the corporation for coverage, the risk is not eligible for any
  751  policy issued by the corporation unless the premium for coverage
  752  from the authorized insurer is more than 20 percent greater than
  753  the premium for comparable coverage from the corporation.
  754  Whenever an offer of coverage for a personal lines residential
  755  risk is received for a policyholder of the corporation at
  756  renewal from an authorized insurer, if the offer is equal to or
  757  less than the corporation’s renewal premium for comparable
  758  coverage, the risk is not eligible for coverage with the
  759  corporation for policies that renew before April 1, 2023; for
  760  policies that renew on or after that date, the risk is not
  761  eligible for coverage with the corporation unless the premium
  762  for coverage from the authorized insurer is more than 20 percent
  763  greater than the corporation’s renewal premium for comparable
  764  coverage. If the risk is not able to obtain such offer, the risk
  765  is eligible for a standard policy including wind coverage or a
  766  basic policy including wind coverage issued by the corporation;
  767  however, if the risk could not be insured under a standard
  768  policy including wind coverage regardless of market conditions,
  769  the risk is eligible for a basic policy including wind coverage
  770  unless rejected under subparagraph 8. However, a policyholder
  771  removed from the corporation through an assumption agreement
  772  remains eligible for coverage from the corporation until the end
  773  of the assumption period. The corporation shall determine the
  774  type of policy to be provided on the basis of objective
  775  standards specified in the underwriting manual and based on
  776  generally accepted underwriting practices. A policyholder
  777  removed from the corporation through an assumption agreement
  778  does not remain eligible for coverage from the corporation after
  779  the end of the policy term. However, any policy removed from the
  780  corporation through an assumption agreement remains on the
  781  corporation’s policy forms through the end of the policy term.
  782         (I) If the risk accepts an offer of coverage through the
  783  market assistance plan or through a mechanism established by the
  784  corporation other than a plan established by s. 627.3518, before
  785  a policy is issued to the risk by the corporation or during the
  786  first 30 days of coverage by the corporation, and the producing
  787  agent who submitted the application to the plan or to the
  788  corporation is not currently appointed by the insurer, the
  789  insurer shall:
  790         (A) Pay to the producing agent of record of the policy for
  791  the first year, an amount that is the greater of the insurer’s
  792  usual and customary commission for the type of policy written or
  793  a fee equal to the usual and customary commission of the
  794  corporation; or
  795         (B) Offer to allow the producing agent of record of the
  796  policy to continue servicing the policy for at least 1 year and
  797  offer to pay the agent the greater of the insurer’s or the
  798  corporation’s usual and customary commission for the type of
  799  policy written.
  800  
  801  If the producing agent is unwilling or unable to accept
  802  appointment, the new insurer shall pay the agent in accordance
  803  with sub-sub-sub-subparagraph (A).
  804         (II) If the corporation enters into a contractual agreement
  805  for a take-out plan, the producing agent of record of the
  806  corporation policy is entitled to retain any unearned commission
  807  on the policy, and the insurer shall:
  808         (A) Pay to the producing agent of record, for the first
  809  year, an amount that is the greater of the insurer’s usual and
  810  customary commission for the type of policy written or a fee
  811  equal to the usual and customary commission of the corporation;
  812  or
  813         (B) Offer to allow the producing agent of record to
  814  continue servicing the policy for at least 1 year and offer to
  815  pay the agent the greater of the insurer’s or the corporation’s
  816  usual and customary commission for the type of policy written.
  817  
  818  If the producing agent is unwilling or unable to accept
  819  appointment, the new insurer shall pay the agent in accordance
  820  with sub-sub-sub-subparagraph (A).
  821         b. With respect to commercial lines residential risks, for
  822  a new application to the corporation for coverage, if the risk
  823  is offered coverage under a policy including wind coverage from
  824  an authorized insurer at its approved rate, the risk is not
  825  eligible for a policy issued by the corporation unless the
  826  premium for coverage from the authorized insurer is more than 20
  827  15 percent greater than the premium for comparable coverage from
  828  the corporation. Whenever an offer of coverage for a commercial
  829  lines residential risk is received for a policyholder of the
  830  corporation at renewal from an authorized insurer, if the offer
  831  is equal to or less than the corporation’s renewal premium for
  832  comparable coverage, the risk is not eligible for coverage with
  833  the corporation unless the premium for coverage from the
  834  authorized insurer is more than 20 percent greater than the
  835  corporation’s renewal premium for comparable coverage. If the
  836  risk is not able to obtain any such offer, the risk is eligible
  837  for a policy including wind coverage issued by the corporation.
  838  However, A policyholder removed from the corporation through an
  839  assumption agreement remains eligible for coverage from the
  840  corporation until the end of the policy term. However, any
  841  policy removed from the corporation through an assumption
  842  agreement remains on the corporation’s policy forms through the
  843  end of the policy term assumption period.
  844         (I) If the risk accepts an offer of coverage through the
  845  market assistance plan or through a mechanism established by the
  846  corporation other than a plan established by s. 627.3518, before
  847  a policy is issued to the risk by the corporation or during the
  848  first 30 days of coverage by the corporation, and the producing
  849  agent who submitted the application to the plan or the
  850  corporation is not currently appointed by the insurer, the
  851  insurer shall:
  852         (A) Pay to the producing agent of record of the policy, for
  853  the first year, an amount that is the greater of the insurer’s
  854  usual and customary commission for the type of policy written or
  855  a fee equal to the usual and customary commission of the
  856  corporation; or
  857         (B) Offer to allow the producing agent of record of the
  858  policy to continue servicing the policy for at least 1 year and
  859  offer to pay the agent the greater of the insurer’s or the
  860  corporation’s usual and customary commission for the type of
  861  policy written.
  862  
  863  If the producing agent is unwilling or unable to accept
  864  appointment, the new insurer shall pay the agent in accordance
  865  with sub-sub-sub-subparagraph (A).
  866         (II) If the corporation enters into a contractual agreement
  867  for a take-out plan, the producing agent of record of the
  868  corporation policy is entitled to retain any unearned commission
  869  on the policy, and the insurer shall:
  870         (A) Pay to the producing agent of record, for the first
  871  year, an amount that is the greater of the insurer’s usual and
  872  customary commission for the type of policy written or a fee
  873  equal to the usual and customary commission of the corporation;
  874  or
  875         (B) Offer to allow the producing agent of record to
  876  continue servicing the policy for at least 1 year and offer to
  877  pay the agent the greater of the insurer’s or the corporation’s
  878  usual and customary commission for the type of policy written.
  879  
  880  If the producing agent is unwilling or unable to accept
  881  appointment, the new insurer shall pay the agent in accordance
  882  with sub-sub-sub-subparagraph (A).
  883         c. For purposes of determining comparable coverage under
  884  sub-subparagraphs a. and b., the comparison must be based on
  885  those forms and coverages that are reasonably comparable. The
  886  corporation may rely on a determination of comparable coverage
  887  and premium made by the producing agent who submits the
  888  application to the corporation, made in the agent’s capacity as
  889  the corporation’s agent. For purposes of comparing the premium
  890  for comparable coverage under sub-subparagraphs a. and b.,
  891  premium includes any surcharge or assessment that is actually
  892  applied to such policy. A comparison may be made solely of the
  893  premium with respect to the main building or structure only on
  894  the following basis: the same coverage A or other building
  895  limits; the same percentage hurricane deductible that applies on
  896  an annual basis or that applies to each hurricane for commercial
  897  residential property; the same percentage of ordinance and law
  898  coverage, if the same limit is offered by both the corporation
  899  and the authorized insurer; the same mitigation credits, to the
  900  extent the same types of credits are offered both by the
  901  corporation and the authorized insurer; the same method for loss
  902  payment, such as replacement cost or actual cash value, if the
  903  same method is offered both by the corporation and the
  904  authorized insurer in accordance with underwriting rules; and
  905  any other form or coverage that is reasonably comparable as
  906  determined by the board. If an application is submitted to the
  907  corporation for wind-only coverage on a risk that is located in
  908  an area eligible for coverage by the Florida Windstorm
  909  Underwriting Association, as that area was defined on January 1,
  910  2002 in the coastal account, the premium for the corporation’s
  911  wind-only policy plus the premium for the ex-wind policy that is
  912  offered by an authorized insurer to the applicant must be
  913  compared to the premium for multiperil coverage offered by an
  914  authorized insurer, subject to the standards for comparison
  915  specified in this subparagraph. If the corporation or the
  916  applicant requests from the authorized insurer a breakdown of
  917  the premium of the offer by types of coverage so that a
  918  comparison may be made by the corporation or its agent and the
  919  authorized insurer refuses or is unable to provide such
  920  information, the corporation may treat the offer as not being an
  921  offer of coverage from an authorized insurer at the insurer’s
  922  approved rate.
  923         6. Must include rules for classifications of risks and
  924  rates.
  925         7. Must provide that if premium and investment income:
  926         a. For an account attributable to a particular calendar
  927  year are in excess of projected losses and expenses for the
  928  account attributable to that year, such excess shall be held in
  929  surplus in the account. Such surplus must be available to defray
  930  deficits in that account as to future years and used for that
  931  purpose before assessing assessable insurers and assessable
  932  insureds as to any calendar year; or
  933         b.For the Citizens account, if established by the
  934  corporation, which are attributable to a particular calendar
  935  year are in excess of projected losses and expenses for the
  936  Citizens account attributable to that year, such excess shall be
  937  held in surplus in the Citizens account. Such surplus must be
  938  available to defray deficits in the Citizens account as to
  939  future years and used for that purpose before assessing
  940  assessable insurers and assessable insureds as to any calendar
  941  year.
  942         8. Must provide objective criteria and procedures to be
  943  uniformly applied to all applicants in determining whether an
  944  individual risk is so hazardous as to be uninsurable. In making
  945  this determination and in establishing the criteria and
  946  procedures, the following must be considered:
  947         a. Whether the likelihood of a loss for the individual risk
  948  is substantially higher than for other risks of the same class;
  949  and
  950         b. Whether the uncertainty associated with the individual
  951  risk is such that an appropriate premium cannot be determined.
  952  
  953  The acceptance or rejection of a risk by the corporation shall
  954  be construed as the private placement of insurance, and the
  955  provisions of chapter 120 do not apply.
  956         9. Must provide that the corporation make its best efforts
  957  to procure catastrophe reinsurance at reasonable rates, to cover
  958  its projected 100-year probable maximum loss as determined by
  959  the board of governors. If catastrophe reinsurance is not
  960  available at reasonable rates, the corporation need not purchase
  961  it, but the corporation shall include the costs of reinsurance
  962  to cover its projected 100-year probable maximum loss in its
  963  rate calculations even if it does not purchase catastrophe
  964  reinsurance.
  965         10. The policies issued by the corporation must provide
  966  that if the corporation or the market assistance plan obtains an
  967  offer from an authorized insurer to cover the risk at its
  968  approved rates, the risk is no longer eligible for renewal
  969  through the corporation, except as otherwise provided in this
  970  subsection.
  971         11. Corporation policies and applications must include a
  972  notice that the corporation policy could, under this section, be
  973  replaced with a policy issued by an authorized insurer which
  974  does not provide coverage identical to the coverage provided by
  975  the corporation. The notice must also specify that acceptance of
  976  corporation coverage creates a conclusive presumption that the
  977  applicant or policyholder is aware of this potential.
  978         12. May establish, subject to approval by the office,
  979  different eligibility requirements and operational procedures
  980  for any line or type of coverage for any specified county or
  981  area if the board determines that such changes are justified due
  982  to the voluntary market being sufficiently stable and
  983  competitive in such area or for such line or type of coverage
  984  and that consumers who, in good faith, are unable to obtain
  985  insurance through the voluntary market through ordinary methods
  986  continue to have access to coverage from the corporation. If
  987  coverage is sought in connection with a real property transfer,
  988  the requirements and procedures may not provide an effective
  989  date of coverage later than the date of the closing of the
  990  transfer as established by the transferor, the transferee, and,
  991  if applicable, the lender.
  992         13. Must provide that:,
  993         a. With respect to the coastal account, any assessable
  994  insurer with a surplus as to policyholders of $25 million or
  995  less writing 25 percent or more of its total countrywide
  996  property insurance premiums in this state may petition the
  997  office, within the first 90 days of each calendar year, to
  998  qualify as a limited apportionment company. A regular assessment
  999  levied by the corporation on a limited apportionment company for
 1000  a deficit incurred by the corporation for the coastal account
 1001  may be paid to the corporation on a monthly basis as the
 1002  assessments are collected by the limited apportionment company
 1003  from its insureds, but a limited apportionment company must
 1004  begin collecting the regular assessments not later than 90 days
 1005  after the regular assessments are levied by the corporation, and
 1006  the regular assessments must be paid in full within 15 months
 1007  after being levied by the corporation. A limited apportionment
 1008  company shall collect from its policyholders any emergency
 1009  assessment imposed under sub-subparagraph (b)3.e. (b)3.d. The
 1010  plan must provide that, if the office determines that any
 1011  regular assessment will result in an impairment of the surplus
 1012  of a limited apportionment company, the office may direct that
 1013  all or part of such assessment be deferred as provided in
 1014  subparagraph (q)4. However, an emergency assessment to be
 1015  collected from policyholders under sub-subparagraph (b)3.e.
 1016  (b)3.d. may not be limited or deferred; or
 1017         b.With respect to the Citizens account, if established by
 1018  the corporation pursuant to sub-subparagraph (b)2.b., any
 1019  assessable insurer with a surplus as to policyholders of $25
 1020  million or less and writing 25 percent or more of its total
 1021  countrywide property insurance premiums in this state may
 1022  petition the office, within the first 90 days of each calendar
 1023  year, to qualify as a limited apportionment company. A limited
 1024  apportionment company shall collect from its policyholders any
 1025  emergency assessment imposed under sub-subparagraph (b)5.c. An
 1026  emergency assessment to be collected from policyholders under
 1027  sub-subparagraph (b)5.c. may not be limited or deferred.
 1028         14. Must provide that the corporation appoint as its
 1029  licensed agents only those agents who throughout such
 1030  appointments also hold an appointment as defined in s. 626.015
 1031  by an insurer who is authorized to write and is actually writing
 1032  or renewing personal lines residential property coverage,
 1033  commercial residential property coverage, or commercial
 1034  nonresidential property coverage within the state.
 1035         15. Must provide a premium payment plan option to its
 1036  policyholders which, at a minimum, allows for quarterly and
 1037  semiannual payment of premiums. A monthly payment plan may, but
 1038  is not required to, be offered.
 1039         16. Must limit coverage on mobile homes or manufactured
 1040  homes built before 1994 to actual cash value of the dwelling
 1041  rather than replacement costs of the dwelling.
 1042         17. Must provide coverage for manufactured or mobile home
 1043  dwellings. Such coverage must also include the following
 1044  attached structures:
 1045         a. Screened enclosures that are aluminum framed or screened
 1046  enclosures that are not covered by the same or substantially the
 1047  same materials as those of the primary dwelling;
 1048         b. Carports that are aluminum or carports that are not
 1049  covered by the same or substantially the same materials as those
 1050  of the primary dwelling; and
 1051         c. Patios that have a roof covering that is constructed of
 1052  materials that are not the same or substantially the same
 1053  materials as those of the primary dwelling.
 1054  
 1055  The corporation shall make available a policy for mobile homes
 1056  or manufactured homes for a minimum insured value of at least
 1057  $3,000.
 1058         18. May provide such limits of coverage as the board
 1059  determines, consistent with the requirements of this subsection.
 1060         19. May require commercial property to meet specified
 1061  hurricane mitigation construction features as a condition of
 1062  eligibility for coverage.
 1063         20. Must provide that new or renewal policies issued by the
 1064  corporation on or after January 1, 2012, which cover sinkhole
 1065  loss do not include coverage for any loss to appurtenant
 1066  structures, driveways, sidewalks, decks, or patios that are
 1067  directly or indirectly caused by sinkhole activity. The
 1068  corporation shall exclude such coverage using a notice of
 1069  coverage change, which may be included with the policy renewal,
 1070  and not by issuance of a notice of nonrenewal of the excluded
 1071  coverage upon renewal of the current policy.
 1072         21.a. As of January 1, 2012, unless the Citizens account
 1073  has been established pursuant to sub-subparagraph (b)2.b., must
 1074  require that the agent obtain from an applicant for coverage
 1075  from the corporation an acknowledgment signed by the applicant,
 1076  which includes, at a minimum, the following statement:
 1077  
 1078                ACKNOWLEDGMENT OF POTENTIAL SURCHARGE              
 1079                      AND ASSESSMENT LIABILITY:                    
 1080  
 1081         1. AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE
 1082  CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A
 1083  DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON,
 1084  MY POLICY COULD BE SUBJECT TO SURCHARGES, WHICH WILL BE DUE AND
 1085  PAYABLE UPON RENEWAL, CANCELLATION, OR TERMINATION OF THE
 1086  POLICY, AND THAT THE SURCHARGES COULD BE AS HIGH AS 45 PERCENT
 1087  OF MY PREMIUM, OR A DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA
 1088  LEGISLATURE.
 1089         2. I UNDERSTAND THAT I CAN AVOID THE CITIZENS POLICYHOLDER
 1090  SURCHARGE, WHICH COULD BE AS HIGH AS 45 PERCENT OF MY PREMIUM,
 1091  BY OBTAINING COVERAGE FROM A PRIVATE MARKET INSURER AND THAT TO
 1092  BE ELIGIBLE FOR COVERAGE BY CITIZENS, I MUST FIRST TRY TO OBTAIN
 1093  PRIVATE MARKET COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE
 1094  WITH CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES
 1095  ARE REGULATED AND APPROVED BY THE STATE.
 1096         3. I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY
 1097  ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER
 1098  INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE
 1099  FLORIDA LEGISLATURE.
 1100         4. I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE
 1101  CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
 1102  STATE OF FLORIDA.
 1103  
 1104         b.The corporation must require, if it has established the
 1105  Citizens account pursuant to sub-subparagraph (b)2.b., that the
 1106  agent obtain from an applicant for coverage from the corporation
 1107  the following acknowledgment signed by the applicant, which
 1108  includes, at a minimum, the following statement:
 1109  
 1110                ACKNOWLEDGMENT OF POTENTIAL SURCHARGE              
 1111                      AND ASSESSMENT LIABILITY:                    
 1112  
 1113         1.AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE
 1114  CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS A
 1115  DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER REASON,
 1116  MY POLICY COULD BE SUBJECT TO SURCHARGES AND ASSESSMENTS, WHICH
 1117  WILL BE DUE AND PAYABLE UPON RENEWAL, CANCELLATION, OR
 1118  TERMINATION OF THE POLICY, AND THAT THE SURCHARGES AND
 1119  ASSESSMENTS COULD BE AS HIGH AS 25 PERCENT OF MY PREMIUM, OR A
 1120  DIFFERENT AMOUNT AS IMPOSED BY THE FLORIDA LEGISLATURE.
 1121         2.I UNDERSTAND THAT I CAN AVOID THE CITIZENS POLICYHOLDER
 1122  SURCHARGE, WHICH COULD BE AS HIGH AS 15 PERCENT OF MY PREMIUM,
 1123  BY OBTAINING COVERAGE FROM A PRIVATE MARKET INSURER AND THAT TO
 1124  BE ELIGIBLE FOR COVERAGE BY CITIZENS, I MUST FIRST TRY TO OBTAIN
 1125  PRIVATE MARKET COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE
 1126  WITH CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES
 1127  ARE REGULATED AND APPROVED BY THE STATE.
 1128         3.I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY
 1129  ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER
 1130  INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY THE
 1131  FLORIDA LEGISLATURE.
 1132         4.I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE
 1133  CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
 1134  STATE OF FLORIDA.
 1135  
 1136         c.a. The corporation shall maintain, in electronic format
 1137  or otherwise, a copy of the applicant’s signed acknowledgment
 1138  and provide a copy of the statement to the policyholder as part
 1139  of the first renewal after the effective date of sub
 1140  subparagraph a. or sub-subparagraph b., as applicable this
 1141  subparagraph.
 1142         d.b. The signed acknowledgment form creates a conclusive
 1143  presumption that the policyholder understood and accepted his or
 1144  her potential surcharge and assessment liability as a
 1145  policyholder of the corporation.
 1146         (n)1. Rates for coverage provided by the corporation must
 1147  be actuarially sound pursuant and subject to s. 627.062 and not
 1148  competitive with approved rates charged in the admitted
 1149  voluntary market so that the corporation functions as a residual
 1150  market mechanism to provide insurance only when insurance cannot
 1151  be procured in the voluntary market, except as otherwise
 1152  provided in this paragraph. The office shall provide the
 1153  corporation such information as would be necessary to determine
 1154  whether rates are competitive. The corporation shall file its
 1155  recommended rates with the office at least annually. The
 1156  corporation shall provide any additional information regarding
 1157  the rates which the office requires. The office shall consider
 1158  the recommendations of the board and issue a final order
 1159  establishing the rates for the corporation within 45 days after
 1160  the recommended rates are filed. The corporation may not pursue
 1161  an administrative challenge or judicial review of the final
 1162  order of the office.
 1163         2. In addition to the rates otherwise determined pursuant
 1164  to this paragraph, the corporation shall impose and collect an
 1165  amount equal to the premium tax provided in s. 624.509 to
 1166  augment the financial resources of the corporation.
 1167         3. After the public hurricane loss-projection model under
 1168  s. 627.06281 has been found to be accurate and reliable by the
 1169  Florida Commission on Hurricane Loss Projection Methodology, the
 1170  model shall be considered when establishing the windstorm
 1171  portion of the corporation’s rates. The corporation may use the
 1172  public model results in combination with the results of private
 1173  models to calculate rates for the windstorm portion of the
 1174  corporation’s rates. This subparagraph does not require or allow
 1175  the corporation to adopt rates lower than the rates otherwise
 1176  required or allowed by this paragraph.
 1177         4. The corporation must make a recommended actuarially
 1178  sound rate filing for each personal and commercial line of
 1179  business it writes.
 1180         5. Notwithstanding the board’s recommended rates and the
 1181  office’s final order regarding the corporation’s filed rates
 1182  under subparagraph 1., the corporation shall annually implement
 1183  a rate increase which, except for sinkhole coverage, does not
 1184  exceed the following for any single policy issued by the
 1185  corporation, excluding coverage changes and surcharges:
 1186         a. Eleven percent for 2022.
 1187         b. Twelve percent for 2023.
 1188         b.c. Thirteen percent for 2024.
 1189         c.d. Fourteen percent for 2025.
 1190         d.e. Fifteen percent for 2026 and all subsequent years.
 1191         6. The corporation may also implement an increase to
 1192  reflect the effect on the corporation of the cash buildup factor
 1193  pursuant to s. 215.555(5)(b).
 1194         7. The corporation’s implementation of rates as prescribed
 1195  in subparagraphs 5. and 8. subparagraph 5. shall cease for any
 1196  line of business written by the corporation upon the
 1197  corporation’s implementation of actuarially sound rates.
 1198  Thereafter, the corporation shall annually make a recommended
 1199  actuarially sound rate filing that is not competitive with
 1200  approved rates in the admitted voluntary market for each
 1201  commercial and personal line of business the corporation writes.
 1202         8.For any new or renewal personal lines policy written on
 1203  or after November 1, 2023, which does not cover a primary
 1204  residence, the rate to be applied in calculating premium is not
 1205  subject to the rate increase limitations in subparagraph 5.
 1206  However, the policyholder may not be charged more than 50
 1207  percent above, and may not be charged less than, the established
 1208  rate for the corporation which was in effect 1 year before the
 1209  date of the application.
 1210         9. As used in this paragraph, the term primary residence”
 1211  means the dwelling that is the policyholder’s primary home or is
 1212  a rental property that is the primary home of the tenant, and
 1213  which the policyholder or tenant occupies for more than 9 months
 1214  of each year.
 1215         (o) If coverage in an account, or the Citizens account if
 1216  established by the corporation, is deactivated pursuant to
 1217  paragraph (p), coverage through the corporation shall be
 1218  reactivated by order of the office only under one of the
 1219  following circumstances:
 1220         1. If the market assistance plan receives a minimum of 100
 1221  applications for coverage within a 3-month period, or 200
 1222  applications for coverage within a 1-year period or less for
 1223  residential coverage, unless the market assistance plan provides
 1224  a quotation from admitted carriers at their filed rates for at
 1225  least 90 percent of such applicants. Any market assistance plan
 1226  application that is rejected because an individual risk is so
 1227  hazardous as to be uninsurable using the criteria specified in
 1228  subparagraph (c)8. shall not be included in the minimum
 1229  percentage calculation provided herein. In the event that there
 1230  is a legal or administrative challenge to a determination by the
 1231  office that the conditions of this subparagraph have been met
 1232  for eligibility for coverage in the corporation, any eligible
 1233  risk may obtain coverage during the pendency of such challenge.
 1234         2. In response to a state of emergency declared by the
 1235  Governor under s. 252.36, the office may activate coverage by
 1236  order for the period of the emergency upon a finding by the
 1237  office that the emergency significantly affects the availability
 1238  of residential property insurance.
 1239         (p)1. The corporation shall file with the office quarterly
 1240  statements of financial condition, an annual statement of
 1241  financial condition, and audited financial statements in the
 1242  manner prescribed by law. In addition, the corporation shall
 1243  report to the office monthly on the types, premium, exposure,
 1244  and distribution by county of its policies in force, and shall
 1245  submit other reports as the office requires to carry out its
 1246  oversight of the corporation.
 1247         2. The activities of the corporation shall be reviewed at
 1248  least annually by the office to determine whether coverage shall
 1249  be deactivated in an account, or in the Citizens account if
 1250  established by the corporation, on the basis that the conditions
 1251  giving rise to its activation no longer exist.
 1252         (q)1. The corporation shall certify to the office its needs
 1253  for annual assessments as to a particular calendar year, and for
 1254  any interim assessments that it deems to be necessary to sustain
 1255  operations as to a particular year pending the receipt of annual
 1256  assessments. Upon verification, the office shall approve such
 1257  certification, and the corporation shall levy such annual or
 1258  interim assessments. Such assessments shall be prorated, if
 1259  authority to levy exists, as provided in paragraph (b). The
 1260  corporation shall take all reasonable and prudent steps
 1261  necessary to collect the amount of assessments due from each
 1262  assessable insurer, including, if prudent, filing suit to
 1263  collect the assessments, and the office may provide such
 1264  assistance to the corporation it deems appropriate. If the
 1265  corporation is unable to collect an assessment from any
 1266  assessable insurer, the uncollected assessments shall be levied
 1267  as an additional assessment against the assessable insurers and
 1268  any assessable insurer required to pay an additional assessment
 1269  as a result of such failure to pay shall have a cause of action
 1270  against such nonpaying assessable insurer. Assessments shall be
 1271  included as an appropriate factor in the making of rates. The
 1272  failure of a surplus lines agent to collect and remit any
 1273  regular or emergency assessment levied by the corporation is
 1274  considered to be a violation of s. 626.936 and subjects the
 1275  surplus lines agent to the penalties provided in that section.
 1276         2. The governing body of any unit of local government, any
 1277  residents of which are insured by the corporation, may issue
 1278  bonds as defined in s. 125.013 or s. 166.101 from time to time
 1279  to fund an assistance program, in conjunction with the
 1280  corporation, for the purpose of defraying deficits of the
 1281  corporation. In order to avoid needless and indiscriminate
 1282  proliferation, duplication, and fragmentation of such assistance
 1283  programs, any unit of local government, any residents of which
 1284  are insured by the corporation, may provide for the payment of
 1285  losses, regardless of whether or not the losses occurred within
 1286  or outside of the territorial jurisdiction of the local
 1287  government. Revenue bonds under this subparagraph may not be
 1288  issued until validated pursuant to chapter 75, unless a state of
 1289  emergency is declared by executive order or proclamation of the
 1290  Governor pursuant to s. 252.36 making such findings as are
 1291  necessary to determine that it is in the best interests of, and
 1292  necessary for, the protection of the public health, safety, and
 1293  general welfare of residents of this state and declaring it an
 1294  essential public purpose to permit certain municipalities or
 1295  counties to issue such bonds as will permit relief to claimants
 1296  and policyholders of the corporation. Any such unit of local
 1297  government may enter into such contracts with the corporation
 1298  and with any other entity created pursuant to this subsection as
 1299  are necessary to carry out this paragraph. Any bonds issued
 1300  under this subparagraph shall be payable from and secured by
 1301  moneys received by the corporation from emergency assessments
 1302  under sub-subparagraph (b)3.e. (b)3.d., and assigned and pledged
 1303  to or on behalf of the unit of local government for the benefit
 1304  of the holders of such bonds. The funds, credit, property, and
 1305  taxing power of the state or of the unit of local government
 1306  shall not be pledged for the payment of such bonds.
 1307         3.a. The corporation shall adopt one or more programs
 1308  subject to approval by the office for the reduction of both new
 1309  and renewal writings in the corporation. Beginning January 1,
 1310  2008, any program the corporation adopts for the payment of
 1311  bonuses to an insurer for each risk the insurer removes from the
 1312  corporation shall comply with s. 627.3511(2) and may not exceed
 1313  the amount referenced in s. 627.3511(2) for each risk removed.
 1314  The corporation may consider any prudent and not unfairly
 1315  discriminatory approach to reducing corporation writings, and
 1316  may adopt a credit against assessment liability or other
 1317  liability that provides an incentive for insurers to take risks
 1318  out of the corporation and to keep risks out of the corporation
 1319  by maintaining or increasing voluntary writings in counties or
 1320  areas in which corporation risks are highly concentrated and a
 1321  program to provide a formula under which an insurer voluntarily
 1322  taking risks out of the corporation by maintaining or increasing
 1323  voluntary writings will be relieved wholly or partially from
 1324  assessments under sub-subparagraph (b)3.a. However, any “take
 1325  out bonus” or payment to an insurer must be conditioned on the
 1326  property being insured for at least 5 years by the insurer,
 1327  unless canceled or nonrenewed by the policyholder. If the policy
 1328  is canceled or nonrenewed by the policyholder before the end of
 1329  the 5-year period, the amount of the take-out bonus must be
 1330  prorated for the time period the policy was insured. When the
 1331  corporation enters into a contractual agreement for a take-out
 1332  plan, the producing agent of record of the corporation policy is
 1333  entitled to retain any unearned commission on such policy, and
 1334  the insurer shall either:
 1335         (I) Pay to the producing agent of record of the policy, for
 1336  the first year, an amount which is the greater of the insurer’s
 1337  usual and customary commission for the type of policy written or
 1338  a policy fee equal to the usual and customary commission of the
 1339  corporation; or
 1340         (II) Offer to allow the producing agent of record of the
 1341  policy to continue servicing the policy for a period of not less
 1342  than 1 year and offer to pay the agent the insurer’s usual and
 1343  customary commission for the type of policy written. If the
 1344  producing agent is unwilling or unable to accept appointment by
 1345  the new insurer, the new insurer shall pay the agent in
 1346  accordance with sub-sub-subparagraph (I).
 1347         b. Any credit or exemption from regular assessments adopted
 1348  under this subparagraph shall last no longer than the 3 years
 1349  following the cancellation or expiration of the policy by the
 1350  corporation. With the approval of the office, the board may
 1351  extend such credits for an additional year if the insurer
 1352  guarantees an additional year of renewability for all policies
 1353  removed from the corporation, or for 2 additional years if the
 1354  insurer guarantees 2 additional years of renewability for all
 1355  policies so removed.
 1356         c. There shall be no credit, limitation, exemption, or
 1357  deferment from emergency assessments to be collected from
 1358  policyholders pursuant to sub-subparagraph (b)3.e. or sub
 1359  subparagraph (b)5.c. (b)3.d.
 1360         4. The plan shall provide for the deferment, in whole or in
 1361  part, of the assessment of an assessable insurer, other than an
 1362  emergency assessment collected from policyholders pursuant to
 1363  sub-subparagraph (b)3.e. or sub-subparagraph (b)5.c. (b)3.d., if
 1364  the office finds that payment of the assessment would endanger
 1365  or impair the solvency of the insurer. In the event an
 1366  assessment against an assessable insurer is deferred in whole or
 1367  in part, the amount by which such assessment is deferred may be
 1368  assessed against the other assessable insurers in a manner
 1369  consistent with the basis for assessments set forth in paragraph
 1370  (b).
 1371         5. Effective July 1, 2007, in order to evaluate the costs
 1372  and benefits of approved take-out plans, if the corporation pays
 1373  a bonus or other payment to an insurer for an approved take-out
 1374  plan, it shall maintain a record of the address or such other
 1375  identifying information on the property or risk removed in order
 1376  to track if and when the property or risk is later insured by
 1377  the corporation.
 1378         6. Any policy taken out, assumed, or removed from the
 1379  corporation is, as of the effective date of the take-out,
 1380  assumption, or removal, direct insurance issued by the insurer
 1381  and not by the corporation, even if the corporation continues to
 1382  service the policies. This subparagraph applies to policies of
 1383  the corporation and not policies taken out, assumed, or removed
 1384  from any other entity.
 1385         7. For a policy taken out, assumed, or removed from the
 1386  corporation, the insurer may, for a period of no more than 3
 1387  years, continue to use any of the corporation’s policy forms or
 1388  endorsements that apply to the policy taken out, removed, or
 1389  assumed without obtaining approval from the office for use of
 1390  such policy form or endorsement.
 1391         (v)1. Effective July 1, 2002, policies of the Residential
 1392  Property and Casualty Joint Underwriting Association become
 1393  policies of the corporation. All obligations, rights, assets and
 1394  liabilities of the association, including bonds, note and debt
 1395  obligations, and the financing documents pertaining to them
 1396  become those of the corporation as of July 1, 2002. The
 1397  corporation is not required to issue endorsements or
 1398  certificates of assumption to insureds during the remaining term
 1399  of in-force transferred policies.
 1400         2. Effective July 1, 2002, policies of the Florida
 1401  Windstorm Underwriting Association are transferred to the
 1402  corporation and become policies of the corporation. All
 1403  obligations, rights, assets, and liabilities of the association,
 1404  including bonds, note and debt obligations, and the financing
 1405  documents pertaining to them are transferred to and assumed by
 1406  the corporation on July 1, 2002. The corporation is not required
 1407  to issue endorsements or certificates of assumption to insureds
 1408  during the remaining term of in-force transferred policies.
 1409         3. The Florida Windstorm Underwriting Association and the
 1410  Residential Property and Casualty Joint Underwriting Association
 1411  shall take all actions necessary to further evidence the
 1412  transfers and provide the documents and instruments of further
 1413  assurance as may reasonably be requested by the corporation for
 1414  that purpose. The corporation shall execute assumptions and
 1415  instruments as the trustees or other parties to the financing
 1416  documents of the Florida Windstorm Underwriting Association or
 1417  the Residential Property and Casualty Joint Underwriting
 1418  Association may reasonably request to further evidence the
 1419  transfers and assumptions, which transfers and assumptions,
 1420  however, are effective on the date provided under this paragraph
 1421  whether or not, and regardless of the date on which, the
 1422  assumptions or instruments are executed by the corporation.
 1423  Subject to the relevant financing documents pertaining to their
 1424  outstanding bonds, notes, indebtedness, or other financing
 1425  obligations, the moneys, investments, receivables, choses in
 1426  action, and other intangibles of the Florida Windstorm
 1427  Underwriting Association shall be credited to the coastal
 1428  account of the corporation, and those of the personal lines
 1429  residential coverage account and the commercial lines
 1430  residential coverage account of the Residential Property and
 1431  Casualty Joint Underwriting Association shall be credited to the
 1432  personal lines account and the commercial lines account,
 1433  respectively, of the corporation.
 1434         4. Effective July 1, 2002, a new applicant for property
 1435  insurance coverage who would otherwise have been eligible for
 1436  coverage in the Florida Windstorm Underwriting Association is
 1437  eligible for coverage from the corporation as provided in this
 1438  subsection.
 1439         5. The transfer of all policies, obligations, rights,
 1440  assets, and liabilities from the Florida Windstorm Underwriting
 1441  Association to the corporation and the renaming of the
 1442  Residential Property and Casualty Joint Underwriting Association
 1443  as the corporation does not affect the coverage with respect to
 1444  covered policies as defined in s. 215.555(2)(c) provided to
 1445  these entities by the Florida Hurricane Catastrophe Fund. The
 1446  coverage provided by the fund to the Florida Windstorm
 1447  Underwriting Association based on its exposures as of June 30,
 1448  2002, and each June 30 thereafter, unless the corporation has
 1449  established the Citizens account, shall be redesignated as
 1450  coverage for the coastal account of the corporation.
 1451  Notwithstanding any other provision of law, the coverage
 1452  provided by the fund to the Residential Property and Casualty
 1453  Joint Underwriting Association based on its exposures as of June
 1454  30, 2002, and each June 30 thereafter, unless the corporation
 1455  has established the Citizens account, shall be transferred to
 1456  the personal lines account and the commercial lines account of
 1457  the corporation. Notwithstanding any other provision of law, the
 1458  coastal account, unless the corporation has established the
 1459  Citizens account, shall be treated, for all Florida Hurricane
 1460  Catastrophe Fund purposes, as if it were a separate
 1461  participating insurer with its own exposures, reimbursement
 1462  premium, and loss reimbursement. Likewise, the personal lines
 1463  and commercial lines accounts, unless the corporation has
 1464  established the Citizens account, shall be viewed together, for
 1465  all fund purposes, as if the two accounts were one and represent
 1466  a single, separate participating insurer with its own exposures,
 1467  reimbursement premium, and loss reimbursement. The coverage
 1468  provided by the fund to the corporation shall constitute and
 1469  operate as a full transfer of coverage from the Florida
 1470  Windstorm Underwriting Association and Residential Property and
 1471  Casualty Joint Underwriting Association to the corporation.
 1472         (w) Notwithstanding any other provision of law:
 1473         1. The pledge or sale of, the lien upon, and the security
 1474  interest in any rights, revenues, or other assets of the
 1475  corporation created or purported to be created pursuant to any
 1476  financing documents to secure any bonds or other indebtedness of
 1477  the corporation shall be and remain valid and enforceable,
 1478  notwithstanding the commencement of and during the continuation
 1479  of, and after, any rehabilitation, insolvency, liquidation,
 1480  bankruptcy, receivership, conservatorship, reorganization, or
 1481  similar proceeding against the corporation under the laws of
 1482  this state.
 1483         2. The proceeding does not relieve the corporation of its
 1484  obligation, or otherwise affect its ability to perform its
 1485  obligation, to continue to collect, or levy and collect,
 1486  assessments, policyholder surcharges or other surcharges under
 1487  sub-subparagraph (b)3.j. (b)3.i., or any other rights, revenues,
 1488  or other assets of the corporation pledged pursuant to any
 1489  financing documents.
 1490         3. Each such pledge or sale of, lien upon, and security
 1491  interest in, including the priority of such pledge, lien, or
 1492  security interest, any such assessments, policyholder surcharges
 1493  or other surcharges, or other rights, revenues, or other assets
 1494  which are collected, or levied and collected, after the
 1495  commencement of and during the pendency of, or after, any such
 1496  proceeding shall continue unaffected by such proceeding. As used
 1497  in this subsection, the term “financing documents” means any
 1498  agreement or agreements, instrument or instruments, or other
 1499  document or documents now existing or hereafter created
 1500  evidencing any bonds or other indebtedness of the corporation or
 1501  pursuant to which any such bonds or other indebtedness has been
 1502  or may be issued and pursuant to which any rights, revenues, or
 1503  other assets of the corporation are pledged or sold to secure
 1504  the repayment of such bonds or indebtedness, together with the
 1505  payment of interest on such bonds or such indebtedness, or the
 1506  payment of any other obligation or financial product, as defined
 1507  in the plan of operation of the corporation related to such
 1508  bonds or indebtedness.
 1509         4. Any such pledge or sale of assessments, revenues,
 1510  contract rights, or other rights or assets of the corporation
 1511  shall constitute a lien and security interest, or sale, as the
 1512  case may be, that is immediately effective and attaches to such
 1513  assessments, revenues, or contract rights or other rights or
 1514  assets, whether or not imposed or collected at the time the
 1515  pledge or sale is made. Any such pledge or sale is effective,
 1516  valid, binding, and enforceable against the corporation or other
 1517  entity making such pledge or sale, and valid and binding against
 1518  and superior to any competing claims or obligations owed to any
 1519  other person or entity, including policyholders in this state,
 1520  asserting rights in any such assessments, revenues, or contract
 1521  rights or other rights or assets to the extent set forth in and
 1522  in accordance with the terms of the pledge or sale contained in
 1523  the applicable financing documents, whether or not any such
 1524  person or entity has notice of such pledge or sale and without
 1525  the need for any physical delivery, recordation, filing, or
 1526  other action.
 1527         5. As long as the corporation has any bonds outstanding,
 1528  the corporation may not file a voluntary petition under chapter
 1529  9 of the federal Bankruptcy Code or such corresponding chapter
 1530  or sections as may be in effect, from time to time, and a public
 1531  officer or any organization, entity, or other person may not
 1532  authorize the corporation to be or become a debtor under chapter
 1533  9 of the federal Bankruptcy Code or such corresponding chapter
 1534  or sections as may be in effect, from time to time, during any
 1535  such period.
 1536         6. If ordered by a court of competent jurisdiction, the
 1537  corporation may assume policies or otherwise provide coverage
 1538  for policyholders of an insurer placed in liquidation under
 1539  chapter 631, under such forms, rates, terms, and conditions as
 1540  the corporation deems appropriate, subject to approval by the
 1541  office.
 1542         (aa) Except as otherwise provided in this paragraph, the
 1543  corporation shall not require the securing and maintaining of
 1544  flood insurance as a condition of coverage of a personal lines
 1545  residential risk. if The insured or applicant must execute
 1546  executes a form approved by the office affirming that flood
 1547  insurance is not provided by the corporation and that if flood
 1548  insurance is not secured by the applicant or insured from an
 1549  insurer other than the corporation and in addition to coverage
 1550  by the corporation, the risk will not be eligible for coverage
 1551  by the corporation covered for flood damage. A corporation
 1552  policyholder electing not to secure flood insurance and
 1553  executing a form as provided herein making a claim for water
 1554  damage against the corporation shall have the burden of proving
 1555  the damage was not caused by flooding. Notwithstanding other
 1556  provisions of this subsection, The corporation may deny coverage
 1557  of a personal lines residential risk to an applicant or insured
 1558  who refuses to secure and maintain flood insurance execute the
 1559  form described herein. The requirement to purchase flood
 1560  insurance shall be implemented as follows:
 1561         1.Except as provided in subparagraphs 2. and 3., all
 1562  personal lines residential policyholders must have flood
 1563  coverage in place for policies effective on or after:
 1564         a.January 1, 2024, for property valued at $600,000 or
 1565  more.
 1566         b.January 1, 2025, for property valued at $500,000 or
 1567  more.
 1568         c.January 1, 2026, for property valued at $400,000 or
 1569  more.
 1570         d.January 1, 2027, for all other personal lines
 1571  residential property insured by the corporation.
 1572         2.All personal lines residential policyholders whose
 1573  property insured by the corporation is located within the
 1574  special flood hazard area defined by the Federal Emergency
 1575  Management Agency must have flood coverage in place:
 1576         a.At the time of initial policy issuance for all new
 1577  personal lines residential policies issued by the corporation on
 1578  or after April 1, 2023.
 1579         b.By the time of the policy renewal for allpersonal lines
 1580  residential policies renewing on or after July 1, 2023.
 1581         3.Policyholders whose policies issued by the corporation
 1582  do not provide coverage for the peril of wind are not required
 1583  to purchase flood insurance as a condition for maintaining their
 1584  policies with the corporation.
 1585  
 1586  The flood insurance required under this paragraph must meet, at
 1587  a minimum, the coverage available from the National Flood
 1588  Insurance Program or the requirements of subparagraphs s.
 1589  627.715(1)(a)1., 2., and 3.
 1590         (ii) The corporation shall revise the programs adopted
 1591  pursuant to sub-subparagraph (q)3.a. for personal lines
 1592  residential policies to maximize policyholder options and
 1593  encourage increased participation by insurers and agents. After
 1594  January 1, 2017, a policy may not be taken out of the
 1595  corporation unless the provisions of this paragraph are met.
 1596         1. The corporation must publish a periodic schedule of
 1597  cycles during which an insurer may identify, and notify the
 1598  corporation of, policies that the insurer is requesting to take
 1599  out. A request must include a description of the coverage
 1600  offered and an estimated premium and must be submitted to the
 1601  corporation in a form and manner prescribed by the corporation.
 1602         2. The corporation must maintain and make available to the
 1603  agent of record a consolidated list of all insurers requesting
 1604  to take out a policy. The list must include a description of the
 1605  coverage offered and the estimated premium for each take-out
 1606  request.
 1607         3. If a policyholder receives a take-out offer from an
 1608  authorized insurer, the risk is no longer eligible for coverage
 1609  with the corporation unless the premium for coverage from the
 1610  authorized insurer is more 20 percent greater than the renewal
 1611  premium for comparable coverage from the corporation pursuant to
 1612  sub-subparagraph (c)5.c. This subparagraph applies to take-out
 1613  offers that are part of an application to participate in
 1614  depopulation submitted to the office on or after January 1,
 1615  2023.
 1616         4. The corporation must provide written notice to the
 1617  policyholder and the agent of record regarding all insurers
 1618  requesting to take out the policy and regarding the
 1619  policyholder’s option to accept a take-out offer or to reject
 1620  all take-out offers and to remain with the corporation. The
 1621  notice must be in a format prescribed by the corporation and
 1622  include, for each take-out offer:
 1623         a. The amount of the estimated premium;
 1624         b. A description of the coverage; and
 1625         c. A comparison of the estimated premium and coverage
 1626  offered by the insurer to the estimated premium and coverage
 1627  provided by the corporation.
 1628         (kk)A corporation policyholder making a claim for water
 1629  damage against the corporation has the burden of proving that
 1630  the damage was not caused by flooding.
 1631         Section 9. Paragraph (s) of subsection (6) of section
 1632  627.351, Florida Statutes, is amended to read:
 1633         627.351 Insurance risk apportionment plans.—
 1634         (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
 1635         (s)1. There shall be no liability on the part of, and no
 1636  cause of action of any nature shall arise against, any
 1637  assessable insurer or its agents or employees, the corporation
 1638  or its agents or employees, members of the board of governors or
 1639  their respective designees at a board meeting, corporation
 1640  committee members, or the office or its representatives, for any
 1641  action taken by them in the performance of their duties or
 1642  responsibilities under this subsection. Such immunity does not
 1643  apply to:
 1644         a. Any of the foregoing persons or entities for any willful
 1645  tort;
 1646         b. The corporation or its producing agents for breach of
 1647  any contract or agreement pertaining to insurance coverage;
 1648         c. The corporation with respect to issuance or payment of
 1649  debt;
 1650         d. Any assessable insurer with respect to any action to
 1651  enforce an assessable insurer’s obligations to the corporation
 1652  under this subsection; or
 1653         e. The corporation in any pending or future action for
 1654  breach of contract or for benefits under a policy issued by the
 1655  corporation; in any such action, the corporation shall be liable
 1656  to the policyholders and beneficiaries for attorney’s fees under
 1657  s. 627.428.
 1658         2. The corporation shall manage its claim employees,
 1659  independent adjusters, and others who handle claims to ensure
 1660  they carry out the corporation’s duty to its policyholders to
 1661  handle claims carefully, timely, diligently, and in good faith,
 1662  balanced against the corporation’s duty to the state to manage
 1663  its assets responsibly to minimize its assessment potential.
 1664         Section 10. Paragraphs (b) and (c) of subsection (3) and
 1665  paragraphs (d), (e), and (f) of subsection (6) of section
 1666  627.3511, Florida Statutes, are amended to read:
 1667         627.3511 Depopulation of Citizens Property Insurance
 1668  Corporation.—
 1669         (3) EXEMPTION FROM DEFICIT ASSESSMENTS.—
 1670         (b) An insurer that first wrote personal lines residential
 1671  property coverage in this state on or after July 1, 1994, is
 1672  exempt from regular deficit assessments imposed pursuant to s.
 1673  627.351(6)(b)3.a., but not emergency assessments collected from
 1674  policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1675  627.351(6)(b)3.d., of the Citizens Property Insurance
 1676  Corporation until the earlier of the following:
 1677         1. The end of the calendar year in which it first wrote 0.5
 1678  percent or more of the statewide aggregate direct written
 1679  premium for any line of residential property coverage; or
 1680         2. December 31, 1997, or December 31 of the third year in
 1681  which it wrote such coverage in this state, whichever is later.
 1682         (c) Other than an insurer that is exempt under paragraph
 1683  (b), an insurer that in any calendar year increases its total
 1684  structure exposure subject to wind coverage by 25 percent or
 1685  more over its exposure for the preceding calendar year is, with
 1686  respect to that year, exempt from deficit assessments imposed
 1687  pursuant to s. 627.351(6)(b)3.a., but not emergency assessments
 1688  collected from policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1689  627.351(6)(b)3.d., of the Citizens Property Insurance
 1690  Corporation attributable to such increase in exposure.
 1691         (6) COMMERCIAL RESIDENTIAL TAKE-OUT PLANS.—
 1692         (d) The calculation of an insurer’s regular assessment
 1693  liability under s. 627.351(6)(b)3.a., but not emergency
 1694  assessments collected from policyholders pursuant to s.
 1695  627.351(6)(b)3.e. s. 627.351(6)(b)3.d., shall, with respect to
 1696  commercial residential policies removed from the corporation
 1697  under an approved take-out plan, exclude such removed policies
 1698  for the succeeding 3 years, as follows:
 1699         1. In the first year following removal of the policies, the
 1700  policies are excluded from the calculation to the extent of 100
 1701  percent.
 1702         2. In the second year following removal of the policies,
 1703  the policies are excluded from the calculation to the extent of
 1704  75 percent.
 1705         3. In the third year following removal of the policies, the
 1706  policies are excluded from the calculation to the extent of 50
 1707  percent.
 1708         (e) An insurer that first wrote commercial residential
 1709  property coverage in this state on or after June 1, 1996, is
 1710  exempt from regular assessments under s. 627.351(6)(b)3.a., but
 1711  not emergency assessments collected from policyholders pursuant
 1712  to s. 627.351(6)(b)3.e. s. 627.351(6)(b)3.d., with respect to
 1713  commercial residential policies until the earlier of:
 1714         1. The end of the calendar year in which such insurer first
 1715  wrote 0.5 percent or more of the statewide aggregate direct
 1716  written premium for commercial residential property coverage; or
 1717         2. December 31 of the third year in which such insurer
 1718  wrote commercial residential property coverage in this state.
 1719         (f) An insurer that is not otherwise exempt from regular
 1720  assessments under s. 627.351(6)(b)3.a. with respect to
 1721  commercial residential policies is, for any calendar year in
 1722  which such insurer increased its total commercial residential
 1723  hurricane exposure by 25 percent or more over its exposure for
 1724  the preceding calendar year, exempt from regular assessments
 1725  under s. 627.351(6)(b)3.a., but not emergency assessments
 1726  collected from policyholders pursuant to s. 627.351(6)(b)3.e. s.
 1727  627.351(6)(b)3.d., attributable to such increased exposure.
 1728         Section 11. Effective January 1, 2023, subsection (5) of
 1729  section 627.3518, Florida Statutes, is amended to read:
 1730         627.3518 Citizens Property Insurance Corporation
 1731  policyholder eligibility clearinghouse program.—The purpose of
 1732  this section is to provide a framework for the corporation to
 1733  implement a clearinghouse program by January 1, 2014.
 1734         (5) Notwithstanding s. 627.3517, any applicant for new
 1735  coverage from the corporation is not eligible for coverage from
 1736  the corporation if provided an offer of coverage from an
 1737  authorized insurer through the program at a premium that is at
 1738  or below the eligibility threshold for applicants for new
 1739  coverage established in s. 627.351(6)(c)5.a. Whenever an offer
 1740  of coverage for a personal lines risk is received for a
 1741  policyholder of the corporation at renewal from an authorized
 1742  insurer through the program which is at or below the eligibility
 1743  threshold for policyholders of the corporation established in s.
 1744  627.351(6)(c)5.a., if the offer is equal to or less than the
 1745  corporation’s renewal premium for comparable coverage, the risk
 1746  is not eligible for coverage with the corporation. In the event
 1747  an offer of coverage for a new applicant is received from an
 1748  authorized insurer through the program, and the premium offered
 1749  exceeds the eligibility threshold for applicants for new
 1750  coverage established contained in s. 627.351(6)(c)5.a., the
 1751  applicant or insured may elect to accept such coverage, or may
 1752  elect to accept or continue coverage with the corporation. In
 1753  the event an offer of coverage for a personal lines risk is
 1754  received from an authorized insurer at renewal through the
 1755  program, and the premium offered exceeds the eligibility
 1756  threshold for policyholders of the corporation established in s.
 1757  627.351(6)(c)5.a. is more than the corporation’s renewal premium
 1758  for comparable coverage, the insured may elect to accept such
 1759  coverage, or may elect to accept or continue coverage with the
 1760  corporation. Section 627.351(6)(c)5.a.(I) does not apply to an
 1761  offer of coverage from an authorized insurer obtained through
 1762  the program. An applicant for coverage from the corporation who
 1763  was declared ineligible for coverage at renewal by the
 1764  corporation in the previous 36 months due to an offer of
 1765  coverage pursuant to this subsection shall be considered a
 1766  renewal under this section if the corporation determines that
 1767  the authorized insurer making the offer of coverage pursuant to
 1768  this subsection continues to insure the applicant and increased
 1769  the rate on the policy in excess of the increase allowed for the
 1770  corporation under s. 627.351(6)(n)5.
 1771         Section 12. Subsection (3) of section 627.410, Florida
 1772  Statutes, is amended to read:
 1773         627.410 Filing, approval of forms.—
 1774         (3) The office may, for cause, withdraw a previous
 1775  approval. No insurer shall issue or use any form disapproved by
 1776  the office, or as to which the office has withdrawn approval,
 1777  after the effective date of the order of the office. Based on a
 1778  finding from a market conduct examination of a property insurer
 1779  that the insurer has exhibited a pattern or practice of one or
 1780  more willful unfair insurance trade practice violations with
 1781  regard to its use of appraisal, the office shall reexamine the
 1782  insurer’s property insurance policy forms that contain an
 1783  appraisal clause, and the office may:
 1784         (a)Withdraw approval of the forms, if warranted by the
 1785  Florida Insurance Code.
 1786         (b)In addition to any regulatory action under ss. 624.418
 1787  and 624.4211, issue an order prohibiting the insurer from
 1788  invoking appraisal for up to 2 years.
 1789         Section 13. Subsections (1) and (4) of section 627.428,
 1790  Florida Statutes, are amended to read:
 1791         627.428 Attorney fees.—
 1792         (1) Except as provided in subsection (4), upon the
 1793  rendition of a judgment or decree by any of the courts of this
 1794  state against an insurer and in favor of any named or omnibus
 1795  insured or the named beneficiary under a policy or contract
 1796  executed by the insurer, the trial court or, in the event of an
 1797  appeal in which the insured or beneficiary prevails, the
 1798  appellate court shall adjudge or decree against the insurer and
 1799  in favor of the insured or beneficiary a reasonable sum as fees
 1800  or compensation for the insured’s or beneficiary’s attorney
 1801  prosecuting the suit in which the recovery is had. In a suit
 1802  arising under a residential or commercial property insurance
 1803  policy, the amount of reasonable attorney fees shall be awarded
 1804  only as provided in s. 57.105 or s. 627.70152, as applicable.
 1805         (4) In a suit arising under a residential or commercial
 1806  property insurance policy, there is no the right to attorney
 1807  fees under this section may not be transferred to, assigned to,
 1808  or acquired in any other manner by anyone other than a named or
 1809  omnibus insured or a named beneficiary.
 1810         Section 14. Paragraph (b) of subsection (4) of section
 1811  627.7011, Florida Statutes, is amended to read:
 1812         627.7011 Homeowners’ policies; offer of replacement cost
 1813  coverage and law and ordinance coverage.—
 1814         (4)
 1815         (b) An insurer that issues a homeowner’s insurance policy
 1816  that does not provide flood insurance coverage must include on
 1817  the policy declarations page with the policy documents at
 1818  initial issuance and every renewal, in bold type no smaller than
 1819  18 points, the following statement:
 1820  
 1821         “FLOOD INSURANCE: YOU SHOULD MAY ALSO NEED TO CONSIDER
 1822         THE PURCHASE OF FLOOD INSURANCE. YOUR HOMEOWNER’S
 1823         INSURANCE POLICY DOES NOT INCLUDE COVERAGE FOR DAMAGE
 1824         RESULTING FROM FLOOD EVEN IF HURRICANE WINDS AND RAIN
 1825         CAUSED THE FLOOD TO OCCUR. WITHOUT SEPARATE FLOOD
 1826         INSURANCE COVERAGE, YOUR YOU MAY HAVE UNCOVERED LOSSES
 1827         CAUSED BY FLOOD ARE NOT COVERED. PLEASE DISCUSS THE
 1828         NEED TO PURCHASE SEPARATE FLOOD INSURANCE COVERAGE
 1829         WITH YOUR INSURANCE AGENT.”
 1830  
 1831         Section 15. Effective March 1, 2023, present subsection (8)
 1832  of section 627.70131, Florida Statutes, is redesignated as
 1833  subsection (9), a new subsection (8) is added to that section,
 1834  and paragraph (a) of subsection (1), subsections (3), (4), and
 1835  (5), and paragraph (a) of subsection (7) of that section are
 1836  amended, to read:
 1837         627.70131 Insurer’s duty to acknowledge communications
 1838  regarding claims; investigation.—
 1839         (1)(a) Upon an insurer’s receiving a communication with
 1840  respect to a claim, the insurer shall, within 7 14 calendar
 1841  days, review and acknowledge receipt of such communication
 1842  unless payment is made within that period of time or unless the
 1843  failure to acknowledge is caused by factors beyond the control
 1844  of the insurer which reasonably prevent such acknowledgment. If
 1845  the acknowledgment is not in writing, a notification indicating
 1846  acknowledgment shall be made in the insurer’s claim file and
 1847  dated. A communication made to or by a representative of an
 1848  insurer with respect to a claim shall constitute communication
 1849  to or by the insurer.
 1850         (3)(a) Unless otherwise provided by the policy of insurance
 1851  or by law, within 7 14 days after an insurer receives proof-of
 1852  loss statements, the insurer shall begin such investigation as
 1853  is reasonably necessary unless the failure to begin such
 1854  investigation is caused by factors beyond the control of the
 1855  insurer which reasonably prevent the commencement of such
 1856  investigation.
 1857         (b) If such investigation involves a physical inspection of
 1858  the property, the licensed adjuster assigned by the insurer must
 1859  provide the policyholder with a printed or electronic document
 1860  containing his or her name and state adjuster license number.
 1861  For claims other than those subject to a hurricane deductible,
 1862  An insurer must conduct any such physical inspection within 30
 1863  45 days after its receipt of the proof-of-loss statements.
 1864         (c) Any subsequent communication with the policyholder
 1865  regarding the claim must also include the name and license
 1866  number of the adjuster communicating about the claim.
 1867  Communication of the adjuster’s name and license number may be
 1868  included with other information provided to the policyholder.
 1869         (d) An insurer may use electronic methods to investigate
 1870  the loss. Such electronic methods may include any method that
 1871  provides the insurer with clear, color pictures or video
 1872  documenting the loss, including, but not limited to, electronic
 1873  photographs or video recordings of the loss, video conferencing
 1874  between the adjuster and the policyholder which includes video
 1875  recording of the loss, and video recordings or photographs of
 1876  the loss using a drone, driverless vehicle, or other machine
 1877  that can move independently or through remote control. The
 1878  insurer also may allow the policyholder to use such methods to
 1879  assist in the investigation of the loss. An insurer may void the
 1880  insurance policy if the policyholder or any other person at the
 1881  direction of the policyholder, with intent to injure, defraud,
 1882  or deceive any insurer, commits insurance fraud by providing
 1883  false, incomplete, or misleading information concerning any fact
 1884  or thing material to a claim using electronic methods. The use
 1885  of electronic methods to investigate the loss does not prohibit
 1886  an insurer from assigning a licensed adjuster to physically
 1887  inspect the property.
 1888         (e)Within 7 days after the insurer’s assignment of an
 1889  adjuster to the claim, The insurer must send notify the
 1890  policyholder that he or she may request a copy of any detailed
 1891  estimate of the amount of the loss within 7 days after the
 1892  estimate is generated by an insurer’s adjuster. After receiving
 1893  such a request from the policyholder, the insurer must send any
 1894  such detailed estimate to the policyholder within the later of 7
 1895  days after the insurer received the request or 7 days after the
 1896  detailed estimate of the amount of the loss is completed. This
 1897  paragraph does not require that an insurer create a detailed
 1898  estimate of the amount of the loss if such estimate is not
 1899  reasonably necessary as part of the claim investigation.
 1900         (4) An insurer shall maintain:
 1901         (a) A record or log of each adjuster who communicates with
 1902  the policyholder as provided in paragraphs (3)(b) and (c) and
 1903  provide a list of such adjusters to the insured, office, or
 1904  department upon request.
 1905         (b)Claim records, including dates, of:
 1906         1.Any claim-related communication made between the insurer
 1907  and the policyholder or the policyholder’s representative;
 1908         2.The insurer’s receipt of the policyholder’s proof of
 1909  loss statement;
 1910         3.Any claim-related request for information made by the
 1911  insurer to the policyholder or the policyholder’s
 1912  representative;
 1913         4.Any claim-related inspections of the property made by
 1914  the insurer, including physical inspections and inspections made
 1915  by electronic means;
 1916         5.Any detailed estimate of the amount of the loss
 1917  generated by the insurer’s adjuster;
 1918         6.The beginning and end of any tolling period provided for
 1919  in subsection (8); and
 1920         7.The insurer’s payment or denial of the claim.
 1921         (5) For purposes of this section, the term:
 1922         (a)“Factors beyond the control of the insurer” means:
 1923         1.Any of the following events that is the basis for the
 1924  office issuing an order finding that such event renders all or
 1925  specified residential property insurers reasonably unable to
 1926  meet the requirements of this section in specified locations and
 1927  ordering that such insurer or insurers may have additional time
 1928  as specified by the office to comply with the requirements of
 1929  this section: a state of emergency declared by the Governor
 1930  under s. 252.36, a breach of security that must be reported
 1931  under s. 501.171(3), or an information technology issue. The
 1932  office may not extend the period for payment or denial of a
 1933  claim for more than 30 additional days.
 1934         2.Actions by the policyholder or the policyholder’s
 1935  representative which constitute fraud, lack of cooperation, or
 1936  intentional misrepresentation regarding the claim for which
 1937  benefits are owed when such actions reasonably prevent the
 1938  insurer from complying with any requirement of this section.
 1939         (b) “Insurer” means any residential property insurer.
 1940         (7)(a) Within 60 90 days after an insurer receives notice
 1941  of an initial, reopened, or supplemental property insurance
 1942  claim from a policyholder, the insurer shall pay or deny such
 1943  claim or a portion of the claim unless the failure to pay is
 1944  caused by factors beyond the control of the insurer which
 1945  reasonably prevent such payment. The insurer shall provide a
 1946  reasonable explanation in writing to the policyholder of the
 1947  basis in the insurance policy, in relation to the facts or
 1948  applicable law, for the payment, denial, or partial denial of a
 1949  claim. If the insurer’s claim payment is less than specified in
 1950  any insurer’s detailed estimate of the amount of the loss, the
 1951  insurer must provide a reasonable explanation in writing of the
 1952  difference to the policyholder. Any payment of an initial or
 1953  supplemental claim or portion of such claim made 60 90 days
 1954  after the insurer receives notice of the claim, or made more
 1955  than 15 days after the expiration of any additional timeframe
 1956  provided to pay or deny a claim or a portion of a claim made
 1957  pursuant to an order of the office finding there are no longer
 1958  factors beyond the control of the insurer which reasonably
 1959  prevented such payment, whichever is later, bears interest at
 1960  the rate set forth in s. 55.03. Interest begins to accrue from
 1961  the date the insurer receives notice of the claim. The
 1962  provisions of this subsection may not be waived, voided, or
 1963  nullified by the terms of the insurance policy. If there is a
 1964  right to prejudgment interest, the insured must select whether
 1965  to receive prejudgment interest or interest under this
 1966  subsection. Interest is payable when the claim or portion of the
 1967  claim is paid. Failure to comply with this subsection
 1968  constitutes a violation of this code. However, failure to comply
 1969  with this subsection does not form the sole basis for a private
 1970  cause of action, except that repeated violations constitute an
 1971  unfair method of competition and an unfair or deceptive act or
 1972  practice as defined in s. 626.9541.
 1973  
 1974  ================= T I T L E  A M E N D M E N T ================
 1975  And the title is amended as follows:
 1976         Delete lines 46 - 47
 1977  and insert:
 1978         revising and adding unfair claim settlement practices
 1979         by a property insurer; amending s.