Florida Senate - 2023 CS for CS for SB 418
By the Committees on Military and Veterans Affairs, Space, and
Domestic Security; and Banking and Insurance; and Senator Perry
583-02356-23 2023418c2
1 A bill to be entitled
2 An act relating to insurance; amending s. 627.062,
3 F.S.; authorizing residential property insurance rate
4 filings to use a specified modeling indication;
5 amending s. 627.0628, F.S.; revising membership
6 requirements for specified members of the Florida
7 Commission on Hurricane Loss Projection Methodology;
8 amending s. 627.0629, F.S.; authorizing insurers to
9 file with the Office of Insurance Regulation personal
10 lines residential property insurance rating plans
11 providing rate differentials based on certain
12 windstorm mitigation construction standards; providing
13 requirements for such plans; amending s. 627.0665,
14 F.S.; revising the timeframe for notices from insurers
15 to insureds of automatic bank withdrawal increases;
16 specifying the increase threshold for such notices;
17 amending s. 627.421, F.S.; revising the types of
18 documents and kinds of insurance for which electronic
19 transmission constitutes delivery to the insured or
20 person entitled to delivery; deleting a requirement to
21 include a certain notice to an insured electing to
22 receive policy documents electronically; deleting a
23 requirement to provide a paper copy of the policy upon
24 request by such person; amending s. 627.701, F.S.;
25 revising and specifying alternative hurricane
26 deductible amounts for personal lines residential
27 property insurance policies covering risks with
28 specified dwelling limits; amending s. 627.712, F.S.;
29 providing that a policyholder’s written exclusion from
30 residential windstorm coverage or contents coverage
31 may be typed rather than handwritten; amending s.
32 627.7276, F.S.; revising the requirements for the
33 notice of limited coverage under certain automobile
34 policies; providing an effective date.
35
36 Be It Enacted by the Legislature of the State of Florida:
37
38 Section 1. Paragraph (j) of subsection (2) of section
39 627.062, Florida Statutes, is amended to read:
40 627.062 Rate standards.—
41 (2) As to all such classes of insurance:
42 (j) With respect to residential property insurance rate
43 filings, the rate filing:
44 1. Must account for mitigation measures undertaken by
45 policyholders to reduce hurricane losses.
46 2. May use a modeling indication that is the weighted or
47 straight average of two or more hurricane loss projection models
48 found by the Florida Commission on Hurricane Loss Projection
49 Methodology to be accurate or reliable pursuant to s. 627.0628.
50
51 The provisions of this subsection do not apply to workers’
52 compensation, employer’s liability insurance, and motor vehicle
53 insurance.
54 Section 2. Paragraph (b) of subsection (2) of section
55 627.0628, Florida Statutes, is amended to read:
56 627.0628 Florida Commission on Hurricane Loss Projection
57 Methodology; public records exemption; public meetings
58 exemption.—
59 (2) COMMISSION CREATED.—
60 (b) The commission shall consist of the following 12
61 members:
62 1. The insurance consumer advocate.
63 2. The senior employee of the State Board of Administration
64 responsible for operations of the Florida Hurricane Catastrophe
65 Fund.
66 3. The Executive Director of the Citizens Property
67 Insurance Corporation or the executive director’s designee. The
68 executive director’s designee must be a full-time employee of
69 the corporation and have actuarial science experience.
70 4. The Director of the Division of Emergency Management or
71 the director’s designee. The director’s designee must be a full
72 time employee of the division.
73 5. The actuary member of the Florida Hurricane Catastrophe
74 Fund Advisory Council.
75 6. An employee of the office who is an actuary responsible
76 for property insurance rate filings and who is appointed by the
77 director of the office.
78 7. Five members appointed by the Chief Financial Officer,
79 as follows:
80 a. An actuary who is employed full time by a property and
81 casualty insurer that was responsible for at least 1 percent of
82 the aggregate statewide direct written premium for homeowner
83 insurance in the calendar year preceding the member’s
84 appointment to the commission.
85 b. An expert in insurance finance who is a full-time member
86 of the faculty of the State University System and who has a
87 background in actuarial science.
88 c. An expert in statistics who is a full-time member of the
89 faculty of the State University System and who has a background
90 in insurance.
91 d. An expert in computer system design who is a full-time
92 member of the faculty of the State University System.
93 e. An expert in meteorology who is a full-time member of
94 the faculty of the State University System and who specializes
95 in hurricanes.
96 8. A licensed professional structural engineer who is a
97 full-time faculty member in the State University System and who
98 has expertise in wind mitigation techniques. This appointment
99 shall be made by the Governor.
100 Section 3. Subsection (9) is added to section 627.0629,
101 Florida Statutes, to read:
102 627.0629 Residential property insurance; rate filings.—
103 (9) An insurer may file with the office a personal lines
104 residential property insurance rating plan that provides
105 justified premium discounts, credits, or other rate
106 differentials based on windstorm mitigation construction
107 standards developed by an independent, nonprofit scientific
108 research organization, if such standards meet the requirements
109 of this section. Such plan must describe the manner in which the
110 insurer will document the existence of the mitigation features
111 and premium discounts, credits, or other rate differentials
112 created under such plan.
113 Section 4. Section 627.0665, Florida Statutes, is amended
114 to read:
115 627.0665 Automatic bank withdrawal agreements; notification
116 required.—Any insurer licensed to issue insurance in the state
117 who has an automatic bank withdrawal agreement with an insured
118 party for the payment of insurance premiums for any type of
119 insurance shall give the named insured at least 10 15 days
120 advance written notice of any increase in policy premiums which
121 results in the next automatic bank withdrawal being increased by
122 more than $10. Such notice must be provided before prior to any
123 automatic bank withdrawal containing the of an increased
124 premium.
125 Section 5. Subsection (1) of section 627.421, Florida
126 Statutes, is amended to read:
127 627.421 Delivery of policy.—
128 (1) Subject to the insurer’s requirement as to payment of
129 premium, every policy shall be mailed, delivered, or
130 electronically transmitted to the insured or to the person
131 entitled thereto not later than 60 days after the effectuation
132 of coverage. Notwithstanding any other provision of law, an
133 insurer may allow a policyholder of personal lines insurance to
134 affirmatively elect delivery of the policy documents, including,
135 but not limited to, policies, endorsements, notices, or
136 documents, by electronic means in lieu of delivery by mail.
137 Electronic transmission of a policy, related notices, and other
138 documents for individual and group health insurance policies or
139 certificates of coverage pursuant to parts VI and VII of this
140 chapter, respectively; health maintenance contracts or
141 certificates of coverage pursuant to part I of chapter 641;
142 prepaid limited health service contracts pursuant to part I of
143 chapter 636; and for commercial risks, including, but not
144 limited to, workers’ compensation and employers’ liability,
145 commercial automobile liability, commercial automobile physical
146 damage, commercial lines residential property, commercial
147 nonresidential property, farmowners insurance, and the types of
148 commercial lines risks set forth in s. 627.062(3)(d),
149 constitutes delivery to the insured or to the person entitled to
150 delivery, unless the insured or the person entitled to delivery
151 communicates to the insurer in writing or electronically that he
152 or she does not agree to delivery by electronic means.
153 Electronic transmission shall include a notice to the insured or
154 to the person entitled to delivery of a policy of his or her
155 right to receive the policy via United States mail rather than
156 via electronic transmission. A paper copy of the policy shall be
157 provided to the insured or to the person entitled to delivery at
158 his or her request.
159 Section 6. Paragraph (d) of subsection (3) of section
160 627.701, Florida Statutes, is amended, and paragraph (a) of that
161 subsection is republished, to read:
162 627.701 Liability of insureds; coinsurance; deductibles.—
163 (3)(a) Except as otherwise provided in this subsection,
164 prior to issuing a personal lines residential property insurance
165 policy, the insurer must offer alternative deductible amounts
166 applicable to hurricane losses equal to $500, 2 percent, 5
167 percent, and 10 percent of the policy dwelling limits, unless
168 the specific percentage deductible is less than $500. The
169 written notice of the offer shall specify the hurricane
170 deductible to be applied in the event that the applicant or
171 policyholder fails to affirmatively choose a hurricane
172 deductible. The insurer must provide such policyholder with
173 notice of the availability of the deductible amounts specified
174 in this subsection in a form approved by the office in
175 conjunction with each renewal of the policy. The failure to
176 provide such notice constitutes a violation of this code but
177 does not affect the coverage provided under the policy.
178 (d) For the following policies, the following alternative
179 deductible amounts are authorized:
180 1. With respect to a policy covering a risk with dwelling
181 limits of $250,000 or more, but less than $1 million, the
182 insurer need not offer the $500 hurricane deductible as required
183 by paragraph (a), but must, except as otherwise provided in this
184 subsection, offer the other hurricane deductibles as required by
185 paragraph (a).
186 2. With respect to a policy covering a risk with dwelling
187 limits of $1 million or more, but less than $3 million, the
188 insurer may, in lieu of offering the $500 and 2 percent
189 deductibles as required by paragraph (a), offer a deductible
190 amount applicable to hurricane losses equal to 3 percent of the
191 policy dwelling limits.
192 3. With respect to a policy covering a risk with dwelling
193 limits of $3 million or more, the insurer need not offer the
194 $500 or 2 percent deductibles as required by paragraph (a), but
195 must, except as otherwise provided by this subsection, offer the
196 other hurricane deductibles as required by paragraph (a).
197 Section 7. Paragraph (a) of subsection (2) and subsection
198 (3) of section 627.712, Florida Statutes, are amended to read:
199 627.712 Residential windstorm coverage required;
200 availability of exclusions for windstorm or contents.—
201 (2) A property insurer must make available, at the option
202 of the policyholder, an exclusion of windstorm coverage.
203 (a) The coverage may be excluded only if:
204 1. When the policyholder is a natural person, the
205 policyholder personally writes or types and provides to the
206 insurer the following statement in his or her own handwriting
207 and signs his or her name, which must also be signed by every
208 other named insured on the policy, and dated: “I do not want the
209 insurance on my (home/mobile home/condominium unit) to pay for
210 damage from windstorms. I will pay those costs. My insurance
211 will not.”
212 2. When the policyholder is other than a natural person,
213 the policyholder provides to the insurer on the policyholder’s
214 letterhead the following statement that must be signed by the
215 policyholder’s authorized representative and dated: “...(Name of
216 entity)... does not want the insurance on its ...(type of
217 structure)... to pay for damage from windstorms. ...(Name of
218 entity)... will be responsible for these costs. ...(Name of
219 entity’s)... insurance will not.”
220 (3) An insurer issuing a residential property insurance
221 policy, except for a condominium unit owner policy or a tenant
222 policy, must make available, at the option of the policyholder,
223 an exclusion of coverage for the contents. The coverage may be
224 excluded only if the policyholder personally writes or types and
225 provides to the insurer the following statement in his or her
226 own handwriting and signs his or her signature, which must also
227 be signed by every other named insured on the policy, and dated:
228 “I do not want the insurance on my (home/mobile home) to pay for
229 the costs to repair or replace any contents that are damaged. I
230 will pay those costs. My insurance will not.”
231 Section 8. Section 627.7276, Florida Statutes, is amended
232 to read:
233 627.7276 Notice of limited coverage.—
234 (1) An automobile policy that does not contain coverage for
235 bodily injury and property damage must include a notice be
236 clearly stamped or printed to the effect that such coverage is
237 not included in the policy in the following manner:
238
239 “THIS POLICY DOES NOT PROVIDE BODILY INJURY AND
240 PROPERTY DAMAGE LIABILITY INSURANCE OR ANY OTHER
241 COVERAGE FOR WHICH A SPECIFIC PREMIUM CHARGE IS NOT
242 MADE, AND DOES NOT COMPLY WITH ANY FINANCIAL
243 RESPONSIBILITY LAW.”
244
245 (2) This notice legend must accompany appear on the policy
246 declarations declaration page and on the filing back of the
247 policy and must be printed in a contrasting color from that used
248 on the policy and in type size at least as large as larger than
249 the largest type size used on the declarations page in the text
250 thereof, as an overprint or by a rubber stamp impression.
251 Section 9. This act shall take effect July 1, 2023.