Florida Senate - 2024 COMMITTEE AMENDMENT
Bill No. CS for SB 1622
Ì199358XÎ199358
LEGISLATIVE ACTION
Senate . House
Comm: RCS .
02/28/2024 .
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The Committee on Fiscal Policy (Trumbull) recommended the
following:
1 Senate Amendment (with title amendment)
2
3 Delete lines 177 - 1245
4 and insert:
5 (10)(a) By January 1, 2025, and each month thereafter, each
6 insurer or insurer group doing business in this state shall file
7 on a monthly quarterly basis in conjunction with financial
8 reports required by paragraph (1)(a) a supplemental report on an
9 individual and group basis on a form prescribed by the
10 commission with information on personal lines and commercial
11 lines residential property insurance policies in this state. The
12 supplemental report must shall include separate information for
13 personal lines property policies and for commercial lines
14 property policies and totals for each item specified, including
15 premiums written for each of the property lines of business as
16 described in ss. 215.555(2)(c) and 627.351(6)(a). The report
17 must shall include the following information for each zip code
18 county on a monthly basis:
19 1. Total number of policies in force at the end of each
20 month.
21 2. Total number of policies canceled.
22 3. Total number of policies nonrenewed.
23 4. Number of policies canceled due to hurricane risk.
24 5. Number of policies nonrenewed due to hurricane risk.
25 6. Number of new policies written.
26 7. Total dollar value of structure exposure under policies
27 that include wind coverage.
28 8. Number of policies that exclude wind coverage.
29 9. Number of claims open each month.
30 10. Number of claims closed each month.
31 11. Number of claims pending each month.
32 12. Number of claims in which either the insurer or insured
33 invoked any form of alternative dispute resolution, and
34 specifying which form of alternative dispute resolution was
35 used.
36 Section 3. Section 624.4305, Florida Statutes, is amended
37 to read:
38 624.4305 Nonrenewal of residential property insurance
39 policies.—Any insurer planning to nonrenew more than 10,000
40 residential property insurance policies in this state within a
41 12-month period shall give notice in writing to the Office of
42 Insurance Regulation for informational purposes 90 days before
43 the issuance of any notices of nonrenewal. The notice provided
44 to the office must set forth the insurer’s reasons for such
45 action, the effective dates of nonrenewal, and any arrangements
46 made for other insurers to offer coverage to affected
47 policyholders. The commission may adopt rules to administer this
48 section.
49 Section 4. Effective upon becoming law, paragraph (d) of
50 subsection (1) of section 624.46226, Florida Statutes, is
51 amended to read:
52 624.46226 Public housing authorities self-insurance funds;
53 exemption for taxation and assessments.—
54 (1) Notwithstanding any other provision of law, any two or
55 more public housing authorities in the state as defined in
56 chapter 421 may form a self-insurance fund for the purpose of
57 pooling and spreading liabilities of its members as to any one
58 or combination of casualty risk or real or personal property
59 risk of every kind and every interest in such property against
60 loss or damage from any hazard or cause and against any loss
61 consequential to such loss or damage, provided the self
62 insurance fund that is created:
63 (d) Maintains a continuing program of excess insurance
64 coverage and reinsurance reserve evaluation to protect the
65 financial stability of the fund in an amount and manner
66 determined by a qualified and independent actuary. The program
67 must, at a minimum, this program must:
68 1. Include a net retention in an amount and manner selected
69 by the administrator, ratified by the governing body, and
70 certified by an independent qualified actuary;
71 2. Include reinsurance or Purchase excess insurance from
72 authorized insurance carriers or eligible surplus lines
73 insurers; and.
74 3. Be certified by a qualified and independent actuary as
75 to the program’s adequacy. This certification must be submitted
76 simultaneously with the certifications required under paragraphs
77 (b) and (c).
78 2. Retain a per-loss occurrence that does not exceed
79 $350,000.
80
81 A for-profit or not-for-profit corporation, limited liability
82 company, or other similar business entity in which a public
83 housing authority holds an ownership interest or participates in
84 its governance under s. 421.08(8) may join a self-insurance fund
85 formed under this section in which such public housing authority
86 participates. Such for-profit or not-for-profit corporation,
87 limited liability company, or other similar business entity may
88 join the self-insurance fund solely to insure risks related to
89 public housing.
90 Section 5. Subsection (2) of section 626.9201, Florida
91 Statutes, is amended to read:
92 626.9201 Notice of cancellation or nonrenewal.—
93 (2) An insurer issuing a policy providing coverage for
94 property, casualty, surety, or marine insurance must give the
95 named insured written notice of cancellation or termination
96 other than nonrenewal at least 45 days before the effective date
97 of the cancellation or termination, including in the written
98 notice the reasons for the cancellation or termination, except
99 that:
100 (a) If cancellation is for nonpayment of premium, at least
101 10 days’ written notice of cancellation accompanied by the
102 reason for cancellation must be given. As used in this
103 paragraph, the term “nonpayment of premium” means the failure of
104 the named insured to discharge when due any of his or her
105 obligations in connection with the payment of premiums on a
106 policy or an installment of such a premium, whether the premium
107 or installment is payable directly to the insurer or its agent
108 or indirectly under any plan for financing premiums or extension
109 of credit or the failure of the named insured to maintain
110 membership in an organization if such membership is a condition
111 precedent to insurance coverage. The term also includes the
112 failure of a financial institution to honor the check of an
113 applicant for insurance which was delivered to a licensed agent
114 for payment of a premium, even if the agent previously delivered
115 or transferred the premium to the insurer. If a correctly
116 dishonored check represents payment of the initial premium, the
117 contract and all contractual obligations are void ab initio
118 unless the nonpayment is cured within the earlier of 5 days
119 after actual notice by certified mail is received by the
120 applicant or 15 days after notice is sent to the applicant by
121 certified mail or registered mail, and, if the contract is void,
122 any premium received by the insurer from a third party must
123 shall be refunded to that party in full; and
124 (b) If cancellation or termination occurs during the first
125 90 days during which the insurance is in force and if the
126 insurance is canceled or terminated for reasons other than
127 nonpayment, at least 20 days’ written notice of cancellation or
128 termination accompanied by the reason for cancellation or
129 termination must be given, except if there has been a material
130 misstatement or misrepresentation or failure to comply with the
131 underwriting requirements established by the insurer; and
132 (c)1. Upon a declaration of an emergency pursuant to s.
133 252.36 and the filing of an order by the Commissioner of
134 Insurance Regulation, an insurer may not cancel or nonrenew a
135 personal residential or commercial residential property
136 insurance policy covering a dwelling or residential property
137 located in this state which has been damaged as a result of a
138 hurricane or wind loss that is the subject of the declaration of
139 emergency for 90 days after the dwelling or residential property
140 has been repaired. A dwelling or residential property is deemed
141 to be repaired when substantially completed and restored to the
142 extent that the dwelling or residential property is insurable by
143 another insurer that is writing policies in this state.
144 2. However, an insurer or its agent may cancel or nonrenew
145 such a policy before the repair of the dwelling or residential
146 property:
147 a. Upon 10 days’ notice for nonpayment of premium; or
148 b. Upon 45 days’ notice:
149 (I) For a material misstatement or fraud related to the
150 claim;
151 (II) If the insurer determines that the insured has
152 unreasonably caused a delay in the repair of the dwelling or
153 residential property;
154 (III) If the insurer or its agent makes a reasonable
155 written inquiry to the insured as to the status of repairs, sent
156 by certified mail, return receipt requested, and the insured
157 fails within 30 calendar days to provide information that is
158 responsive to the inquiry to either the address or e-mail
159 account designated by the insurer; or
160 (IV) If the insurer has paid policy limits.
161 3. If the insurer elects to nonrenew a policy covering a
162 property that has been damaged, the insurer must provide at
163 least 90 days’ notice to the insured that the insurer intends to
164 nonrenew the policy 90 days after the dwelling or residential
165 property has been repaired.
166 4. This paragraph does not prevent the insurer from
167 canceling or nonrenewing the policy 90 days after the repair is
168 completed for the same reasons the insurer would otherwise have
169 canceled or nonrenewed the policy but for the limitations of
170 subparagraph 1.
171 5. The Financial Services Commission may adopt rules, and
172 the Commissioner of Insurance Regulation may issue orders,
173 necessary to implement this paragraph.
174 Section 6. Paragraph (j) of subsection (2) of section
175 627.062, Florida Statutes, is amended to read:
176 627.062 Rate standards.—
177 (2) As to all such classes of insurance:
178 (j) With respect to residential property insurance rate
179 filings, the rate filing:
180 1. Must account for mitigation measures undertaken by
181 policyholders to reduce hurricane losses and windstorm losses.
182 2. May use a modeling indication that is the weighted or
183 straight average of two or more hurricane loss projection models
184 found by the Florida Commission on Hurricane Loss Projection
185 Methodology to be accurate or reliable pursuant to s. 627.0628.
186 If an averaged model is used under this section, the same
187 averaged model must be used throughout this state. If a weighted
188 average is used, the insurer must provide the office with an
189 actuarial justification for using the weighted average which
190 shows that the weighted average results in a rate that is
191 reasonable, adequate, and fair.
192
193 The provisions of this subsection do not apply to workers’
194 compensation, employer’s liability insurance, and motor vehicle
195 insurance.
196 Section 7. Paragraph (n) of subsection (6) of section
197 627.351, Florida Statutes, is amended to read:
198 627.351 Insurance risk apportionment plans.—
199 (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
200 (n)1. Rates for coverage provided by the corporation must
201 be actuarially sound pursuant to s. 627.062 and not competitive
202 with approved rates charged in the admitted voluntary market so
203 that the corporation functions as a residual market mechanism to
204 provide insurance only when insurance cannot be procured in the
205 voluntary market, except as otherwise provided in this
206 paragraph. The office shall provide the corporation such
207 information as would be necessary to determine whether rates are
208 competitive. The corporation shall file its recommended rates
209 with the office at least annually. The corporation shall provide
210 any additional information regarding the rates which the office
211 requires. The office shall consider the recommendations of the
212 board and issue a final order establishing the rates for the
213 corporation within 45 days after the recommended rates are
214 filed. The corporation may not pursue an administrative
215 challenge or judicial review of the final order of the office.
216 2. In addition to the rates otherwise determined pursuant
217 to this paragraph, the corporation shall impose and collect an
218 amount equal to the premium tax provided in s. 624.509 to
219 augment the financial resources of the corporation.
220 3. After the public hurricane loss-projection model under
221 s. 627.06281 has been found to be accurate and reliable by the
222 Florida Commission on Hurricane Loss Projection Methodology, the
223 model shall be considered when establishing the windstorm
224 portion of the corporation’s rates. The corporation may use the
225 public model results in combination with the results of private
226 models to calculate rates for the windstorm portion of the
227 corporation’s rates. This subparagraph does not require or allow
228 the corporation to adopt rates lower than the rates otherwise
229 required or allowed by this paragraph.
230 4. The corporation must make a recommended actuarially
231 sound rate filing for each personal and commercial line of
232 business it writes.
233 5. Notwithstanding the board’s recommended rates and the
234 office’s final order regarding the corporation’s filed rates
235 under subparagraph 1., the corporation shall annually implement
236 a rate increase which, except for sinkhole coverage, does not
237 exceed the following for any single policy issued by the
238 corporation, excluding coverage changes and surcharges:
239 a. Twelve percent for 2023.
240 b. Thirteen percent for 2024.
241 c. Fourteen percent for 2025.
242 d. Fifteen percent for 2026 and all subsequent years.
243 6. The corporation may also implement an increase to
244 reflect the effect on the corporation of the cash buildup factor
245 pursuant to s. 215.555(5)(b).
246 7. The corporation’s implementation of rates as prescribed
247 in subparagraphs 5. and 8. shall cease for any line of business
248 written by the corporation upon the corporation’s implementation
249 of actuarially sound rates. Thereafter, the corporation shall
250 annually make a recommended actuarially sound rate filing that
251 is not competitive with approved rates in the admitted voluntary
252 market for each commercial and personal line of business the
253 corporation writes.
254 8. The following New or renewal personal lines policies
255 that do not cover a primary residence written on or after
256 November 1, 2023, are not subject to the rate increase
257 limitations in subparagraph 5., but may not be charged more than
258 50 percent above, nor less than, the prior year’s established
259 rate for the corporation:
260 a. Policies that do not cover a primary residence;
261 b. New policies under which the coverage for the insured
262 risk, before the date of application with the corporation, was
263 last provided by an insurer determined by the office to be
264 unsound or an insurer placed in receivership under chapter 631;
265 or
266 c. Subsequent renewals of those policies, including the new
267 policies in sub-subparagraph b., under which the coverage for
268 the insured risk, before the date of application with the
269 corporation, was last provided by an insurer determined by the
270 office to be unsound or an insurer placed in receivership under
271 chapter 631.
272 9. As used in this paragraph, the term “primary residence”
273 means the dwelling that is the policyholder’s primary home or is
274 a rental property that is the primary home of the tenant, and
275 which the policyholder or tenant occupies for more than 9 months
276 of each year.
277 Section 8. Paragraph (a) of subsection (5) of section
278 627.7011, Florida Statutes, is amended to read:
279 627.7011 Homeowners’ policies; offer of replacement cost
280 coverage and law and ordinance coverage.—
281 (5)(a) As used in this subsection, the term “authorized
282 inspector” means an inspector who is approved by the insurer and
283 who is:
284 1. A home inspector licensed under s. 468.8314;
285 2. A building code inspector certified under s. 468.607;
286 3. A general, building, or residential contractor licensed
287 under s. 489.111 or a roofing contractor;
288 4. A professional engineer licensed under s. 471.015;
289 5. A professional architect licensed under s. 481.213; or
290 6. Any other individual or entity recognized by the insurer
291 as possessing the necessary qualifications to properly complete
292 a general inspection of a residential structure insured with a
293 homeowner’s insurance policy.
294 Section 9. Section 628.011, Florida Statutes, is amended to
295 read:
296 628.011 Scope of part.—This part applies only to domestic
297 stock insurers, mutual insurers, and captive insurers, except
298 that s. 628.341(2) applies also as to foreign and alien
299 insurers.
300 Section 10. Section 628.061, Florida Statutes, is amended
301 to read:
302 628.061 Investigation of proposed organization.—In
303 connection with any proposal to organize or incorporate a
304 domestic insurer, the office shall make an investigation of:
305 (1) The character, reputation, financial standing, and
306 motives of the organizers, incorporators, and subscribers
307 organizing the proposed insurer or any attorney in fact.
308 (2) The character, financial responsibility, insurance
309 experience, and business qualifications of its proposed
310 officers, members of its subscribers’ advisory committee, or
311 officers of its attorney in fact.
312 (3) The character, financial responsibility, business
313 experience, and standing of the proposed stockholders and
314 directors, including the stockholders and directors of any
315 attorney in fact.
316 Section 11. Subsections (1), (2), and (5) of section
317 628.801, Florida Statutes, are amended to read:
318 628.801 Insurance holding companies; registration;
319 regulation.—
320 (1) An insurer that is authorized to do business in this
321 state and that is a member of an insurance holding company
322 shall, on or before April 1 of each year, register with the
323 office and file a registration statement and be subject to
324 regulation with respect to its relationship to the holding
325 company as provided by law or rule. The commission shall adopt
326 rules establishing the information and statement form required
327 for registration and the manner in which registered insurers and
328 their affiliates are regulated. The rules apply to domestic
329 insurers, foreign insurers, and commercially domiciled insurers,
330 except for foreign insurers domiciled in states that are
331 currently accredited by the NAIC. Except to the extent of any
332 conflict with this code, the rules must include all requirements
333 and standards of the Insurance Holding Company System Model
334 Regulation and ss. 4 and 5 of the Insurance Holding Company
335 System Regulatory Act and the Insurance Holding Company System
336 Model Regulation of the NAIC, as adopted in December 2020 2010.
337 The commission may adopt subsequent amendments thereto if the
338 methodology remains substantially consistent. The rules may
339 include a prohibition on oral contracts between affiliated
340 entities. Material transactions between an insurer and its
341 affiliates must shall be filed with the office as provided by
342 rule.
343 (2) Effective January 1, 2015, The ultimate controlling
344 person of every insurer subject to registration shall also file
345 an annual enterprise risk report on or before April 1. As used
346 in this subsection, the term “ultimate controlling person” means
347 a person who is not controlled by any other person. The report
348 must, to the best of the ultimate controlling person’s knowledge
349 and belief, must identify the material risks within the
350 insurance holding company system that could pose enterprise risk
351 to the insurer. The report must shall be filed with the lead
352 state office of the insurance holding company system as
353 determined by the procedures within the Financial Analysis
354 Handbook adopted by the NAIC and is confidential and exempt from
355 public disclosure as provided in s. 624.4212.
356 (a) An insurer may satisfy this requirement by providing
357 the office with the most recently filed parent corporation
358 reports that have been filed with the Securities and Exchange
359 Commission which provide the appropriate enterprise risk
360 information.
361 (b) The term “enterprise risk” means an activity, a
362 circumstance, an event, or a series of events involving one or
363 more affiliates of an insurer which, if not remedied promptly,
364 are likely to have a materially adverse effect upon the
365 financial condition or liquidity of the insurer or its insurance
366 holding company system as a whole, including anything that would
367 cause the insurer’s risk-based capital to fall into company
368 action level as set forth in s. 624.4085 or would cause the
369 insurer to be in a hazardous financial condition.
370 (c) The commission may adopt rules for filing the annual
371 enterprise risk report in accordance with the Insurance Holding
372 Company System Regulatory Act and the Insurance Holding Company
373 System Model Regulation of the NAIC, as adopted in December
374 2020.
375 (5) Effective January 1, 2015, The failure to file a
376 registration statement, or a summary of the registration
377 statement, or the enterprise risk filing report required by this
378 section within the time specified for filing is a violation of
379 this section.
380 Section 12. Section 629.011, Florida Statutes, is amended
381 to read:
382 629.011 Definitions “Reciprocal insurance” defined.—As used
383 in this part, the term:
384 (1) “Affiliated person” of another person means any of the
385 following:
386 (a) The spouse of the other person.
387 (b) The parents of the other person, and their lineal
388 descendants, and the parents of the other person’s spouse, and
389 their lineal descendants.
390 (c) A person who directly or indirectly owns or controls,
391 or holds with power to vote, 10 percent or more of the
392 outstanding voting securities of the other person.
393 (d) A person who directly or indirectly owns 10 percent or
394 more of the outstanding voting securities that are directly or
395 indirectly owned or controlled, or held with power to vote, by
396 the other person.
397 (e) A person or group of persons who directly or indirectly
398 control, are controlled by, or are under common control with the
399 other person.
400 (f) A director, an officer, a trustee, a partner, an owner,
401 a manager, a joint venturer, an employee, or other person
402 performing duties similar to those of persons in such positions.
403 (g) If the other person is an investment company, any
404 investment adviser of such company or any member of an advisory
405 board of such company.
406 (h) If the other person is an unincorporated investment
407 company not having a board of directors, the depositor of such
408 company.
409 (i) A person who has entered into an agreement, written or
410 unwritten, to act in concert with the other person in acquiring,
411 or limiting the disposition of:
412 1. Securities of an attorney in fact or controlling company
413 that is a stock corporation; or
414 2. An ownership interest of an attorney in fact or
415 controlling company that is not a stock corporation.
416 (2) “Attorney in fact” or “attorney” means the attorney in
417 fact of a reciprocal insurer. The attorney in fact may be an
418 individual, a corporation, or another person.
419 (3) “Controlling company” means a person, a corporation, a
420 trust, a limited liability company, an association, or another
421 entity owning, directly or indirectly, 10 percent or more of the
422 voting securities of one or more attorneys in fact that are
423 stock corporations, or 10 percent or more of the ownership
424 interest of one or more attorneys in fact that are not stock
425 corporations.
426 (4) “Reciprocal insurance” means is that resulting from an
427 interexchange among persons, known as “subscribers,” of
428 reciprocal agreements of indemnity, the interexchange being
429 effectuated through an “attorney in fact” common to all such
430 persons.
431 (5) “Reciprocal insurer” means unincorporated aggregation
432 of subscribers operating individually and collectively through
433 an attorney in fact to provide reciprocal insurance among
434 themselves.
435 Section 13. Section 629.021, Florida Statutes, is repealed.
436 Section 14. Section 629.061, Florida Statutes, is repealed.
437 Section 15. Section 629.081, Florida Statutes, is amended
438 to read:
439 629.081 Organization of reciprocal insurer.—
440 (1) Twenty-five or more persons domiciled in this state may
441 organize a domestic reciprocal insurer by making application to
442 the office for a permit to do so. A domestic reciprocal insurer
443 may not be formed unless the persons so proposing have first
444 received a permit from the office and make application to the
445 office for a certificate of authority to transact insurance.
446 (2) The permit application, to be filed by the organizers
447 or the proposed attorney in fact, must be in writing and made in
448 accordance with forms prescribed by the commission. In addition
449 to any applicable requirements of s. 628.051 or other relevant
450 statutes, the application must include all of the following
451 shall fulfill the requirements of and shall execute and file
452 with the office, when applying for a certificate of authority, a
453 declaration setting forth:
454 (a) The name of the proposed reciprocal insurer, which
455 shall be in accordance with s. 629.051.;
456 (b) The location of the insurer’s principal office, which
457 shall be the same as that of the proposed attorney in fact and
458 shall be maintained within this state.;
459 (c) The kinds of insurance proposed to be transacted.;
460 (d) The names and addresses of the original 25 or more
461 subscribers.;
462 (e) The proposed designation and appointment of the
463 proposed attorney in fact and a copy of the proposed power of
464 attorney.;
465 (f) The names and addresses of the officers and directors
466 of the proposed attorney in fact, if a corporation, or of its
467 members, if other than a corporation, as well as the background
468 information as specified in s. 629.227 for all officers,
469 directors, and equivalent positions of the proposed attorney in
470 fact as well as for any person with ownership interests of 10
471 percent or more in the proposed attorney in fact.;
472 (g) The articles of incorporation and bylaws, or equivalent
473 documents, of the proposed attorney in fact, dated within the
474 last year and appropriately certified.
475 (h)(g) The proposed charter powers of the subscribers’
476 advisory committee, and the names and terms of office of the
477 members thereof as well as the background information as
478 specified in s. 629.227 for each proposed member.;
479 (h) That all moneys paid to the reciprocal shall, after
480 deducting therefrom any sum payable to the attorney, be held in
481 the name of the insurer and for the purposes specified in the
482 subscribers’ agreement;
483 (i) A copy of the proposed subscribers’ agreement.;
484 (j) A statement that each of the original subscribers has
485 in good faith applied for insurance of a kind proposed to be
486 transacted, and that the insurer has received from each such
487 subscriber the full premium or premium deposit required for the
488 policy applied for, for a term of not less than 6 months at an
489 adequate rate theretofore filed with and approved by the office;
490 (k) A statement of the financial condition of the insurer,
491 a schedule of its assets, and a statement that the surplus as
492 required by s. 629.071 is on hand; and
493 (j)(l) A copy of each policy, endorsement, and application
494 form the insurer it then proposes to issue or use.
495 (3) The filing must be accompanied by the application fee
496 required under s. 624.501(1)(a) and such other pertinent
497 information and documents as reasonably requested by the office.
498 (4) The office shall evaluate and grant or deny the permit
499 application in accordance with ss. 628.061, 628.071, and other
500 relevant provisions of the code.
501
502 Such declaration shall be acknowledged by the attorney before an
503 officer authorized to take acknowledgments.
504 Section 16. Section 629.091, Florida Statutes, is amended
505 to read:
506 629.091 Reciprocal certificate of authority.—
507 (1) A domestic reciprocal insurer may seek a certificate of
508 authority only after obtaining a permit.
509 (2) To apply for a certificate of authority as a domestic
510 reciprocal insurer, the attorney in fact of an applicant who has
511 previously received a permit from the office may file an
512 application for a certificate of authority in accordance with
513 forms prescribed by the commission that, in addition to
514 applicable requirements of ss. 624.404, 624.411, and 624.413 and
515 other relevant statutes, consist of all of the following:
516 (a) Executed copies of any proposed or draft documents
517 required as part of the permit application.
518 (b) A statement affirming that all moneys paid to the
519 reciprocal insurer shall, after deducting therefrom any sum
520 payable to the attorney in fact, be held in the name of the
521 insurer and for the purposes specified in the subscribers’
522 agreement.
523 (c) A statement that each of the original subscribers has
524 in good faith applied for insurance of a kind proposed to be
525 transacted, and that the insurer has received from each such
526 subscriber the full premium or premium deposit required for the
527 policy applied for, for a term of not less than 6 months at an
528 adequate rate theretofore filed with and approved by the office.
529 (d) A copy of the bond required under s. 629.121.
530 (e) A statement of the financial condition of the insurer,
531 a schedule of its assets, and a statement that the surplus as
532 required by s. 629.071 is on hand.
533 (f) Such other pertinent information or documents as
534 reasonably requested by the office.
535 (3) If the reciprocal insurer intends to issue
536 nonassessable policies upon the receipt of a certificate of
537 authority, and the office determines that the reciprocal insurer
538 meets the legal requirements to issue nonassessable policies,
539 including the surplus requirements, the office must grant
540 authorization to issue nonassessable policies.
541 (4) The certificate of authority of a reciprocal insurer
542 shall be issued to its attorney in the name of the reciprocal
543 insurer to its attorney in fact.
544 Section 17. Section 629.094, Florida Statutes, is created
545 to read:
546 629.094 Continued eligibility for certificate of
547 authority.—In order to maintain its eligibility for a
548 certificate of authority, a domestic reciprocal insurer shall
549 continue to meet all applicable conditions required for
550 receiving the initial permit and certificate of authority under
551 this code and the rules adopted thereunder.
552 Section 18. Section 629.101, Florida Statutes, is amended
553 to read:
554 629.101 Power of attorney.—
555 (1) The rights and powers of the attorney in fact of a
556 reciprocal insurer are shall be as provided in the power of
557 attorney given it by the subscribers.
558 (2) The power of attorney must set forth all of the
559 following:
560 (a) The powers of the attorney in fact.;
561 (b) That the attorney in fact is empowered to accept
562 service of process on behalf of the insurer in actions against
563 the insurer upon contracts exchanged.;
564 (c) The place where the office of the attorney in fact is
565 maintained.
566 (d) The general services to be performed by the attorney in
567 fact.;
568 (e) That the attorney in fact has a fiduciary duty to the
569 subscribers of the reciprocal insurer.
570 (f)(d) The maximum amount to be deducted from advance
571 premiums or deposits to be paid to the attorney in fact and the
572 general items of expense in addition to losses, to be paid by
573 the insurer.; and
574 (g)(e) Except as to nonassessable policies, a provision for
575 a contingent several liability of each subscriber in a specified
576 amount, which amount may shall be not be less than 5 or nor more
577 than 10 times the premium or premium deposit stated in the
578 policy.
579 (3) The power of attorney may do all of the following:
580 (a) Provide for the right of substitution of the attorney
581 in fact and revocation of the power of attorney and rights
582 thereunder.;
583 (b) Impose such restrictions upon the exercise of the power
584 as are agreed upon by the subscribers.;
585 (c) Provide for the exercise of any right reserved to the
586 subscribers directly or through their advisory committee.; and
587 (4)(d) The power of attorney must contain other lawful
588 provisions deemed advisable.
589 (5)(4) The terms of any power of attorney or agreement
590 collateral thereto must shall be reasonable and equitable, and
591 no such power or agreement may shall be used or be effective in
592 this state unless filed with the office.
593 Section 19. Section 629.225, Florida Statutes, is created
594 to read:
595 629.225 Acquisitions.—The provisions of this section apply
596 to domestic reciprocal insurers and the attorney in fact of
597 domestic reciprocal insurers.
598 (1) A person may not, individually or in conjunction with
599 any affiliated person of such person, directly or indirectly,
600 conclude a tender offer or exchange offer for, enter into any
601 agreement to exchange securities for, or otherwise finally
602 acquire, 10 percent or more of the outstanding voting securities
603 of an attorney in fact which is a stock corporation or of a
604 controlling company of an attorney in fact which is a stock
605 corporation; or conclude an acquisition of, or otherwise finally
606 acquire, 10 percent or more of the ownership interest of an
607 attorney in fact which is not a stock corporation or of a
608 controlling company of an attorney which is not a stock
609 corporation, unless all of the following conditions are met:
610 (a) The person or affiliated person has filed with the
611 office and sent to the principal office of the attorney in fact,
612 and any controlling company of the attorney in fact, the
613 subscribers’ advisory committee, and the domestic reciprocal
614 insurer a letter of notification regarding the transaction or
615 proposed transaction no later than 5 days after any form of
616 tender offer or exchange offer is proposed, or no later than 5
617 days after the acquisition of the securities or ownership
618 interest if a tender offer or exchange offer is not involved.
619 The notification must be provided on forms prescribed by the
620 commission containing information determined necessary to
621 understand the transaction and identify all purchasers and
622 owners involved.
623 (b) The subscribers’ advisory committee has provided the
624 notification required under paragraph (a) on a form prescribed
625 by the commission, explaining what the notification is and
626 letting the subscribers know of the filing deadlines for
627 objecting to the acquisition.
628 (c) The person or affiliated person has filed with the
629 office an application signed under oath and prepared on forms
630 prescribed by the commission which contains the information
631 specified in subsection (4). The application must be completed
632 and filed within 30 days after any form of tender offer or
633 exchange offer is proposed, or after the acquisition of the
634 securities if a tender offer or exchange offer is not involved.
635 (d) The office has approved the tender offer or exchange
636 offer, or acquisition if a tender offer or exchange offer is not
637 involved.
638 (2) This section does not apply to any acquisition of
639 voting securities or ownership interest of an attorney in fact
640 or of a controlling company by any person who is the owner of a
641 majority of the voting securities or ownership interest with the
642 approval of the office under this section or s. 629.091.
643 (3) The person or affiliated person filing the notice
644 required by paragraph (1)(a) may request that the office waive
645 the requirements of paragraph (1)(b), provided that there is no
646 change in the ultimate controlling shareholders, and no change
647 in the ownership percentages of the ultimate controlling
648 shareholders, and no unaffiliated parties acquire any direct or
649 indirect interest in the attorney in fact. The office may waive
650 the filing required by paragraph (1)(b) if it determines that
651 there is no change in the ultimate controlling shareholders, and
652 no change in the ownership percentages of the ultimate
653 controlling shareholders, and no unaffiliated parties will
654 acquire any direct or indirect interest in the attorney in fact.
655 (4) The application to be filed with the office and
656 furnished to the attorney in fact must contain the following
657 information and any additional information as the office deems
658 necessary to determine the character, experience, ability, and
659 other qualifications of the person or affiliated person of such
660 person for the protection of the reciprocal insurer’s
661 subscribers and of the public:
662 (a) The identity and background information specified in s.
663 629.227 of:
664 1. Each person by whom, or on whose behalf, the acquisition
665 is to be made; and
666 2. Any person who controls, directly or indirectly, such
667 other person, including each director, officer, trustee,
668 partner, owner, manager, or joint venturer, or other person
669 performing duties similar to those of persons in such positions,
670 for the person.
671 (b) The source and amount of the funds or other
672 consideration used, or to be used, in making the acquisition.
673 (c) Any plans or proposals which such persons may have made
674 to liquidate the attorney in fact or controlling company, to
675 sell any of their assets or merge or consolidate them with any
676 person, or to make any other major change in their business or
677 corporate structure or management.
678 (d) The nature and the extent of the controlling interest
679 which the person or affiliated person of such person proposes to
680 acquire, the terms of the proposed acquisition, and the manner
681 in which the controlling interest is to be acquired of an
682 attorney in fact or controlling company which is not a stock
683 corporation.
684 (e) The number of shares or other securities which the
685 person or affiliated person of such person proposes to acquire,
686 the terms of the proposed acquisition, and the manner in which
687 the securities are to be acquired.
688 (f) Information as to any contract, arrangement, or
689 understanding with any party with respect to any of the
690 securities of the attorney in fact or controlling company,
691 including, but not limited to, information relating to the
692 transfer of any of the securities, option arrangements, puts or
693 calls, or the giving or withholding of proxies, which
694 information names the party with whom the contract, arrangement,
695 or understanding has been entered into and gives the details
696 thereof.
697 (g) The filing must be accompanied by the fee required
698 under s. 624.501(1)(a).
699 (5) If any material change occurs in the facts provided in
700 the application filed with the office pursuant to this section
701 or the background information required under s. 629.227, an
702 amendment specifying such changes must be filed immediately with
703 the office, and a copy of the amendment must be sent to the
704 principal office of the attorney in fact and to the principal
705 office of the controlling company.
706 (6)(a) The acquisition application must be reviewed in
707 accordance with chapter 120. The office may on its own initiate,
708 or, if requested to do so in writing by a substantially affected
709 person, shall conduct a proceeding to consider the
710 appropriateness of the proposed filing. Time periods for
711 purposes of chapter 120 shall be tolled during the pendency of
712 the proceeding. Any written request for a proceeding must be
713 filed with the office within 10 days after the date notice of
714 the filing is given, or 10 days after notice of the filing is
715 sent to the subscribers by the subscribers advisory committee,
716 whichever is later. During the pendency of the proceeding or
717 review period by the office, any person or affiliated person
718 complying with the filing requirements of this section may
719 proceed and take all steps necessary to conclude the acquisition
720 so long as the acquisition becoming final is conditioned upon
721 obtaining office approval. However, at any time it finds an
722 immediate danger to the public health, safety, and welfare of
723 the reciprocal insurer’s subscribers exists, the office shall
724 immediately order, pursuant to s. 120.569(2)(n), the proposed
725 acquisition disapproved and any further steps to conclude the
726 acquisition ceased.
727 (b) During the pendency of the office’s review of any
728 acquisition subject to the provisions of this section, the
729 acquiring person may not make any material change in the
730 operation of the attorney in fact or controlling company unless
731 the office has specifically approved the change, nor shall the
732 acquiring person make any material change in the management of
733 the attorney in fact unless advance written notice of the change
734 in management is furnished to the office. The term “material
735 change in the operation of the attorney in fact” means a
736 transaction that disposes of or obligates 5 percent or more of
737 the capital and surplus of the attorney in fact or of any
738 domestic reciprocal insurer. The term “material change in the
739 management of the attorney in fact” means any change in
740 management involving officers or directors of the attorney in
741 fact or any person of the attorney or controlling company having
742 authority to dispose of or obligate 5 percent or more of the
743 attorney in fact’s capital or surplus. The office shall approve
744 a material change in operations if it finds the applicable
745 provisions of subsection (8) have been met. The office may
746 disapprove a material change in management if it finds that the
747 applicable provisions of subsection (8) have not been met and in
748 such case the attorney in fact shall promptly change management
749 as acceptable to the office.
750 (c) If a request for a proceeding is filed, the proceeding
751 must be conducted within 60 days after the date the written
752 request for a proceeding is received by the office. A
753 recommended order must be issued within 20 days after the date
754 of the close of the proceedings. A final order shall be issued
755 within 20 days after the date of the recommended order or, if
756 exceptions to the recommended order are filed, within 20 days
757 after the date the exceptions are filed.
758 (7) The office may disapprove any acquisition subject to
759 this section by any person or any affiliated person of such
760 person who:
761 (a) Willfully violates this section;
762 (b) In violation of an order of the office issued pursuant
763 to subsection (11), fails to divest himself or herself of any
764 stock or ownership interest obtained in violation of this
765 section or fails to divest himself or herself of any direct or
766 indirect control of such stock or ownership interest, within 25
767 days after such order; or
768 (c) In violation of an order issued by the office pursuant
769 to subsection (12), acquires an additional stock or ownership
770 interest in an attorney in fact or controlling company or direct
771 or indirect control of such stock or ownership interest, without
772 complying with this section.
773 (8) The person or persons filing the application required
774 by this section have the burden of proof. The office shall
775 approve any such acquisition if it finds, on the basis of the
776 record made during any proceeding or on the basis of the filed
777 application if no proceeding is conducted, that:
778 (a) The financial condition of the acquiring person or
779 persons will not jeopardize the financial stability of the
780 attorney in fact or prejudice the interests of the reciprocal
781 insurer’s subscribers or the public.
782 (b) Any plan or proposal which the acquiring person has, or
783 acquiring persons have, made:
784 1. To liquidate the attorney in fact, sell its assets, or
785 merge or consolidate it with any person, or to make any other
786 major change in its business or corporate structure or
787 management is fair and free of prejudice to the reciprocal
788 insurer’s subscribers or to the public; or
789 2. To liquidate any controlling company, sell its assets,
790 or merge or consolidate it with any person, or to make any major
791 change in its business or corporate structure or management
792 which would have an effect upon the attorney in fact, is fair
793 and free of prejudice to the reciprocal insurer’s subscribers or
794 to the public.
795 (c) The competence, experience, and integrity of those
796 persons who will control directly or indirectly the operation of
797 the attorney in fact indicate that the acquisition is in the
798 best interest of the reciprocal insurer’s subscribers and in the
799 public interest.
800 (d) The natural persons for whom background information is
801 required to be furnished pursuant to this section have such
802 backgrounds as to indicate that it is in the best interests of
803 the reciprocal insurer’s subscribers and in the public interest
804 to permit such persons to exercise control over the attorney in
805 fact.
806 (e) The directors and officers, if such attorney in fact or
807 controlling company is a stock corporation, or the trustees,
808 partners, owners, managers, joint venturers, or other persons
809 performing duties similar to those of persons in such positions,
810 if such attorney in fact or controlling company is not a stock
811 corporation, to be employed after the acquisition have
812 sufficient insurance experience and ability to assure reasonable
813 promise of successful operation.
814 (f) The management of the attorney in fact after the
815 acquisition will be competent, trustworthy, and will possess
816 sufficient managerial experience so as to make the proposed
817 operation of the attorney in fact not hazardous to the
818 insurance-buying public.
819 (g) The management of the attorney in fact after the
820 acquisition may not include any person who has directly or
821 indirectly through ownership, control, reinsurance transactions,
822 or other insurance or business relations unlawfully manipulated
823 the assets, accounts, finances, or books of any insurer or
824 otherwise acted in bad faith with respect thereto.
825 (h) The acquisition is not likely to be hazardous or
826 prejudicial to the reciprocal insurer’s subscribers or to the
827 public.
828 (i) The effect of the acquisition would not substantially
829 lessen competition in the line of insurance for which the
830 reciprocal insurer is licensed or certified in this state or
831 would not tend to create a monopoly therein.
832 (9) A vote by the stockholder of record, or by any other
833 person, of any security acquired in contravention of this
834 section is not valid. Any acquisition contrary to this section
835 is void. Upon the petition of the attorney in fact, the
836 controlling company, or the reciprocal insurer, the circuit
837 court for the county in which the principal office of the
838 attorney in fact is located may, without limiting the generality
839 of its authority, order the issuance or entry of an injunction
840 or other order to enforce this section. There shall be a private
841 right of action in favor of the attorney in fact, or controlling
842 company, to enforce this section. A demand upon the office that
843 it performs its functions may not be required as a prerequisite
844 to any suit by the attorney in fact or controlling company
845 against any other person, and in no case shall the office be
846 deemed a necessary party to any action by the attorney in fact
847 or controlling company to enforce this section. Any person who
848 makes or proposes an acquisition requiring the filing of an
849 application pursuant to this section, or who files such an
850 application, shall be deemed to have thereby designated the
851 Chief Financial Officer, or his or her assistant or deputy or
852 another person in charge of his or her office, as such person’s
853 agent for service of process under this section and shall
854 thereby be deemed to have submitted himself or herself to the
855 administrative jurisdiction of the office and to the
856 jurisdiction of the circuit court.
857 (10) Any approval by the office under this section does not
858 constitute a recommendation by the office of the tender offer or
859 exchange offer, or acquisition, if no tender offer or exchange
860 offer is involved. It is unlawful for a person to represent that
861 the office’s approval constitutes a recommendation. A person who
862 violates this subsection commits a felony of the third degree,
863 punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
864 The statute of limitations period for the prosecution of an
865 offense committed under this subsection is 5 years.
866 (11) A person may rebut a presumption of control by filing
867 a disclaimer of control with the office on a form prescribed by
868 the commission. The disclaimer must fully disclose all material
869 relationships and bases for affiliation between the person and
870 the attorney in fact as well as the basis for disclaiming the
871 affiliation. In lieu of such form, a person or acquiring party
872 may file with the office a copy of a Schedule 13G filed with the
873 Securities and Exchange Commission pursuant to Rule 13d-1(b) or
874 (c), 17 C.F.R. s. 240.13d-1, under the Securities Exchange Act
875 of 1934, as amended. After a disclaimer has been filed, the
876 attorney in fact is relieved of any duty to register or report
877 under this section which may arise out of the attorney in fact’s
878 relationship with the person unless the office disallows the
879 disclaimer.
880 (12) If the office determines that any person or any
881 affiliated person of such person has acquired 10 percent or more
882 of the outstanding voting securities of an attorney in fact or
883 controlling company which is a stock corporation, or 10 percent
884 or more of the ownership interest of an attorney in fact or
885 controlling company which is not a stock corporation, without
886 complying with this section, the office may order that the
887 person and any affiliated person of such person cease
888 acquisition of the attorney in fact or controlling company and,
889 if appropriate, divest itself of any stock or ownership interest
890 acquired in violation of this section.
891 (13)(a) The office must, if necessary to protect the public
892 interest, suspend or revoke the certificate of authority of the
893 reciprocal insurer whose attorney in fact or controlling company
894 is acquired in violation of this section.
895 (b) If any reciprocal insurer is subject to suspension or
896 revocation pursuant to paragraph (a), any other reciprocal
897 insurer using the same attorney in fact is also subject to
898 suspension or revocation. In such case, the office may offer any
899 affected reciprocal insurer, through its subscriber
900 representatives, the ability to cure any suspension or
901 revocation by procuring another attorney in fact acceptable to
902 the office or taking any other action agreed to by the office.
903 Section 20. Section 629.227, Florida Statutes, is created
904 to read:
905 629.227 Background information.—The information as to the
906 background and identity of each person about whom information is
907 required to be furnished pursuant to s. 629.081 or s. 629.225
908 must include, but need not be limited to:
909 (1) A sworn biographical statement, on forms adopted by the
910 commission, which must include, but need not be limited to, the
911 following information:
912 (a) Occupations, positions of employment, and offices held
913 during the past 20 years, including the principal business and
914 address of any business, corporation, or organization where each
915 occupation, position of employment, or office occurred.
916 (b) Whether the person was, at any time during a 10-year
917 period, convicted of any crime other than a traffic violation.
918 (c) Whether the person has been, during a 10-year period,
919 the subject of any proceeding for the revocation of any license
920 and, if so, the nature of the proceeding and the disposition of
921 the proceeding.
922 (d) Whether, during a 10-year period, the person has been
923 the subject of any proceeding under the federal Bankruptcy Act.
924 (e) Whether, during a 10-year period, any person or other
925 business or organization in which the person was a director,
926 officer, trustee, partner, owner, manager, or other official has
927 been subject of any proceeding under the federal Bankruptcy Act,
928 either during the time of that person’s tenure with the business
929 or organization or within 12 months thereafter.
930 (f) Whether, during a 10-year period, the person has been
931 enjoined, temporarily or permanently, by a court of competent
932 jurisdiction from violating any federal or state law regulating
933 the business of insurance, securities, or banking, or from
934 carrying out any particular practice or practices in the course
935 of the business of insurance, securities, or banking, together
936 with details as to any such event.
937 (g) Whether, during a 20-year period, the person served as
938 the attorney in fact, a subscribers’ advisory committee member,
939 or any other manager or officer of a reciprocal insurer or an
940 insurer that became insolvent or had its certificate of
941 authority suspended or revoked.
942 (2) A full set of fingerprints, which must be provided to
943 the department or to a vendor, entity, or agency authorized by
944 s. 943.053(13). The department, vendor, entity, or agency shall
945 forward the fingerprints to the Department of Law Enforcement
946 for state processing and the Department of Law Enforcement shall
947 forward the fingerprints to the Federal Bureau of Investigation
948 for national processing as described in s. 624.34. Fees for
949 state and federal fingerprint processing must be borne by the
950 individual. The state cost for fingerprint processing is as
951 provided in s. 943.053(3)(e).
952 (3) Authority for release of information in regard to the
953 investigation of such person’s background.
954 (4) Any additional information as the office deems
955 necessary to determine the character, experience, ability, and
956 other qualifications of the person or affiliated person of such
957 person for the protection of the reciprocal insurer’s
958 subscribers and of the public.
959 Section 21. Section 629.229, Florida Statutes, is created
960 to read:
961 629.229 Attorney in fact, officers, and directors of
962 insolvent reciprocal insurers or other insurers.—Any person who
963 served as an attorney in fact, or as an officer, director, or
964 manager of an attorney in fact, any member of a subscribers’
965 advisory committee of a reciprocal insurer doing business in
966 this state, or an officer or director of any other insurer doing
967 business in this state, and who served in that capacity within
968 the 2-year period before the date the insurer or reciprocal
969 insurer became insolvent, for any insolvency that occurs on or
970 after July 1, 2024, may not thereafter:
971 (1) Serve as an attorney in fact, or as an officer,
972 director, or manager of an attorney in fact, or a member of a
973 subscribers advisory committee of a reciprocal insurer doing
974 business in this state, or an officer or director of any other
975 insurer doing business in this state; or
976 (2) Have direct or indirect control over the selection or
977 appointment of an attorney in fact, or of an officer, director,
978 or manager of an attorney in fact, or a member of the
979 subscribers committee of a reciprocal insurer doing business in
980 this state, or an officer or director of any insurer doing
981 business in this state, through contract, trust, or by operation
982 of law,
983
984 unless the individual demonstrates that his or her personal
985 actions or omissions were not a significant contributing cause
986 to the insolvency.
987 Section 22. Section 629.261, Florida Statutes, is amended
988 to read:
989 629.261 Nonassessable policies.—Upon impairment of the
990 surplus of a nonassessable reciprocal insurer, the office shall
991 revoke the authorization issued under s. 629.291(5) or s.
992 629.091(3). Upon revocation of the authority to issue
993 nonassessable policies, the reciprocal insurer may not issue or
994 renew nonassessable policies or convert assessable policies to
995 nonassessable policies, and the provisions of s. 629.301 applies
996 to such insurer.
997 (1) If a reciprocal insurer has a surplus as to
998 policyholders required of a domestic stock insurer authorized to
999 transact like kinds of insurance, upon application of the
1000 attorney and as approved by the subscribers’ advisory committee
1001 the office shall issue its certificate authorizing the insurer
1002 to extinguish the contingent liability of subscribers under its
1003 policies then in force in this state and to omit provisions
1004 imposing contingent liability in all policies delivered or
1005 issued for delivery in this state for so long as all such
1006 surplus remains unimpaired.
1007 (2) Upon impairment of such surplus, the office shall
1008 forthwith revoke the certificate. Such revocation does shall not
1009 render subject to contingent liability any policy then in force
1010 and for the remainder of the period for which the premium has
1011 theretofore been paid; but, after such revocation, no policy
1012 shall be issued or renewed without providing for contingent
1013 assessment liability of the subscriber.
1014 (3) The office shall not authorize a domestic reciprocal
1015 insurer so to extinguish the contingent liability of any of its
1016 subscribers or in any of its policies to be issued, unless it
1017 qualifies to and does extinguish such liability of all its
1018 subscribers and in all such policies for all kinds of insurance
1019 transacted by it; except that, if required by the laws of
1020 another state in which the insurer is transacting insurance as
1021 an authorized insurer, the insurer may issue policies providing
1022 for the contingent liability of such of its subscribers as may
1023 acquire such policies in such state, and need not extinguish the
1024 contingent liability applicable to policies theretofore in force
1025 in such state.
1026 Section 23. Section 629.291, Florida Statutes, is amended
1027 to read:
1028 629.291 Merger or conversion.—
1029 (1) A domestic reciprocal insurer, upon affirmative vote of
1030 not less than two-thirds of its subscribers who vote on such
1031 merger pursuant to due notice, and subject to the approval by of
1032 the office of the terms therefor, may merge with another
1033 reciprocal insurer or be converted to a stock or mutual insurer,
1034 to be thereafter governed by the applicable sections of the
1035 insurance code. However, a domestic stock insurer may not
1036 convert to a reciprocal insurer.
1037 (2) A plan to merge a reciprocal insurer with another
1038 reciprocal insurer or for conversion of the reciprocal insurer
1039 to a stock or mutual insurer must be filed on forms adopted by
1040 the office and contain such information as the office reasonably
1041 requires to evaluate the transaction Such a stock or mutual
1042 insurer shall be subject to the same capital or surplus
1043 requirements and shall have the same rights as a like domestic
1044 insurer transacting like kinds of insurance.
1045 (3) The office may shall not approve any plan for such
1046 merger or conversion which is inequitable to subscribers or
1047 which, if for conversion to a stock insurer, does not give each
1048 subscriber preferential right to acquire stock of the proposed
1049 insurer proportionate to his or her interest in the reciprocal
1050 insurer, as determined in accordance with s. 629.281, and a
1051 reasonable length of time within which to exercise such right.
1052 (4) Reinsurance of all or substantially all of the
1053 insurance in force of a domestic reciprocal insurer in another
1054 insurer shall be deemed to be a merger for the purposes of this
1055 section.
1056 (5)(a) An assessable reciprocal insurer may convert to a
1057 nonassessable reciprocal insurer if:
1058 1. The subscribers’ advisory committee approves the
1059 conversion;
1060 2. The attorney in fact submits the application for
1061 conversion on the required application form; and
1062 3. The office finds that the application for conversion
1063 meets the minimum statutory requirements.
1064 (b) If the office approves the application for conversion,
1065 the assessable reciprocal insurer may convert to a nonassessable
1066 reciprocal insurer by:
1067 1. Extinguishing the contingent liability of subscribers
1068 under all policies then in force in this state;
1069 2. Omitting contingent liability provisions in all policies
1070 delivered or issued in this state after the conversion; and
1071 3. Otherwise extinguishing the contingent liability of all
1072 of its subscribers. However, if the reciprocal insurer is
1073 transacting insurance as an authorized insurer in another state
1074 and that state’s laws require the insurer to issue policies with
1075 contingent liability provisions, the insurer may issue
1076 contingent liability policies in that other state.
1077 Section 24. Section 629.525, Florida Statutes, is created
1078 to read:
1079 629.525 Rulemaking authority.—The commission shall adopt,
1080 amend, or repeal rules necessary to implement this chapter.
1081 Section 25. Paragraph (h) of subsection (3) of section
1082 163.01, Florida Statutes, is amended to read:
1083 163.01 Florida Interlocal Cooperation Act of 1969.—
1084 (3) As used in this section:
1085 (h) “Local government liability pool” means a reciprocal
1086 insurer as defined in s. 629.011 s. 629.021 or any self
1087 insurance program created pursuant to s. 768.28(16), formed and
1088 controlled by counties or municipalities of this state to
1089 provide liability insurance coverage for counties,
1090 municipalities, or other public agencies of this state, which
1091 pool may contract with other parties for the purpose of
1092 providing claims administration, processing, accounting, and
1093 other administrative facilities.
1094 Section 26. Subsection (3) of section 626.9531, Florida
1095 Statutes, is amended to read:
1096 626.9531 Identification of insurers, agents, and insurance
1097 contracts.—
1098 (3) For the purposes of this section, the term “risk
1099 bearing entity” means a reciprocal insurer as defined in s.
1100 629.011 s. 629.021, a commercial self-insurance fund as defined
1101 in s. 624.462, a group self-insurance fund as defined in s.
1102 624.4621, a local government self-insurance fund as defined in
1103 s. 624.4622, a self-insured public utility as defined in s.
1104 624.46225, or an independent educational institution self
1105 insurance fund as defined in s. 624.4623. For the purposes of
1106 this section, the term “risk bearing entity” does not include an
1107 authorized insurer as defined in s. 624.09.
1108 Section 27. Except as otherwise expressly provided in this
1109 act and except for this section, which shall take effect upon
1110 this act becoming a law, this act shall take effect July 1,
1111 2024.
1112
1113 ================= T I T L E A M E N D M E N T ================
1114 And the title is amended as follows:
1115 Delete lines 6 - 156
1116 and insert:
1117 beginning on a specified date, requiring insurers and
1118 insurer groups to file a specified supplemental report
1119 on a monthly basis; requiring that such report include
1120 certain information for each zip code; amending s.
1121 624.4305, F.S.; authorizing the Financial Services
1122 Commission to adopt rules related to notice of
1123 nonrenewal of residential property insurance policies;
1124 amending s. 624.46226, F.S.; revising the requirements
1125 for public housing authority self-insurance funds;
1126 amending s. 626.9201, F.S.; prohibiting insurers from
1127 canceling or nonrenewing certain insurance policies
1128 under certain circumstances; providing exceptions;
1129 providing construction; authorizing the commission to
1130 adopt rules and the Commissioner of Insurance
1131 Regulation to issue orders; amending s. 627.062, F.S.;
1132 specifying requirements for rate filings if certain
1133 models are used; amending s. 627.351, F.S.; revising
1134 requirements for certain policies that are not subject
1135 to certain rate increase limitations; amending s.
1136 627.7011, F.S.; revising the definition of the term
1137 “authorized inspector”; amending s. 628.011, F.S.;
1138 conforming provisions to changes made by the act;
1139 amending s. 628.061, F.S.; conforming a provision to
1140 changes made by the act; revising the persons that the
1141 office is required to investigate in connection with a
1142 proposal to organize or incorporate a domestic
1143 insurer; amending s. 628.801, F.S.; revising
1144 requirements for rules adopted for insurers that are
1145 members of an insurance holding company; deleting an
1146 obsolete date; authorizing the commission to adopt
1147 rules; amending s. 629.011, F.S.; defining terms;
1148 repealing s. 629.021, F.S., relating to the definition
1149 of the term “reciprocal insurer”; repealing s.
1150 629.061, F.S., relating to the term “attorney”;
1151 amending s. 629.081, F.S.; revising the procedure for
1152 persons to organize as a domestic reciprocal insurer;
1153 specifying requirements for the permit application;
1154 requiring that the application be accompanied by a
1155 specified fee and other pertinent information and
1156 documents; requiring the office to evaluate and grant
1157 or deny the permit application in accordance with
1158 specified provisions; amending s. 629.091, F.S.;
1159 providing that a domestic reciprocal insurer may seek
1160 a certificate of authority only under certain
1161 circumstances; providing requirements for an
1162 application for a certificate of authority to operate
1163 as a domestic reciprocal insurer; requiring the office
1164 to grant authorization to issue nonassessable policies
1165 under certain circumstances; requiring that a
1166 certificate of authority be issued in the name of the
1167 reciprocal insurer to its attorney in fact; creating
1168 s. 629.094, F.S.; requiring a domestic reciprocal
1169 insurer to meet certain requirements to maintain its
1170 eligibility for a certificate of authority; amending
1171 s. 629.101, F.S.; revising requirements for the power
1172 of attorney given by subscribers of a domestic
1173 reciprocal insurer to its attorney in fact; requiring
1174 that such power of attorney contain certain
1175 provisions; creating s. 629.225, F.S.; providing
1176 applicability; prohibiting persons from concluding a
1177 tender offer or exchange offer or acquiring securities
1178 of certain attorneys in fact and controlling companies
1179 of certain attorneys in fact; providing an exception;
1180 providing applicability; authorizing certain persons
1181 to request that the office waive certain requirements;
1182 providing that the office may waive certain
1183 requirements if specified determinations are made;
1184 specifying the requirements of an application to the
1185 office relating to certain acquisitions; requiring
1186 that such application be accompanied by a specified
1187 fee; requiring that amendments be filed with the
1188 office under certain circumstances; specifying the
1189 manner in which the acquisition application must be
1190 reviewed; authorizing the office, and requiring the
1191 office if a request for a proceeding is filed, to
1192 conduct a proceeding within a specified timeframe to
1193 consider the appropriateness of such application;
1194 requiring that certain time periods be tolled;
1195 requiring that written requests for a proceeding be
1196 filed within a certain timeframe; authorizing certain
1197 persons to take all steps to conclude the acquisition
1198 during the pendency of the proceeding or review
1199 period; requiring the office to order a proposed
1200 acquisition disapproved and that actions to conclude
1201 the acquisition be ceased under certain circumstances;
1202 prohibiting certain persons from making certain
1203 changes during the pendency of the office’s review of
1204 an acquisition; providing an exception; defining the
1205 terms “material change in the operation of the
1206 attorney in fact” and “material change in the
1207 management of the attorney in fact”; requiring the
1208 office to approve or disapprove certain changes upon
1209 making certain findings; requiring that a proceeding
1210 be conducted within a certain timeframe; requiring
1211 that recommended orders and final orders be issued
1212 within a certain timeframe; specifying the
1213 circumstances under which the office may disapprove an
1214 acquisition; specifying that certain persons have the
1215 burden of proof; requiring the office to approve an
1216 acquisition upon certain findings; specifying that
1217 certain votes are not valid and that certain
1218 acquisitions are void; specifying that certain
1219 provisions may be enforced by an injunction; creating
1220 a private right of action in favor of the attorney in
1221 fact or the controlling company to enforce certain
1222 provisions; providing that a certain demand upon the
1223 office is not required before certain legal actions;
1224 providing that the office is not a necessary party to
1225 certain actions; specifying the persons who are deemed
1226 designated for service of process and who have
1227 submitted to the administrative jurisdiction of the
1228 office; providing that approval by the office does not
1229 constitute a certain recommendation; providing that
1230 certain actions are unlawful; providing criminal
1231 penalties; providing a statute of limitations;
1232 authorizing a person to rebut a presumption of control
1233 by filing certain disclaimers; specifying the contents
1234 of such disclaimer; specifying that, after a
1235 disclaimer is filed, the attorney in fact is relieved
1236 of a certain duty; authorizing the office to order
1237 certain persons to cease acquisition of the attorney
1238 in fact or controlling company and divest themselves
1239 of any stock or ownership interest under certain
1240 circumstances; requiring the office to suspend or
1241 revoke the reciprocal certificate of authority under
1242 certain circumstances; creating s. 629.227, F.S.;
1243 specifying the information as to the background and
1244 identity of certain persons which must be furnished by
1245 such persons; creating s. 629.229, F.S.; prohibiting
1246 certain persons who served in certain capacities
1247 before a specified date from serving in certain other
1248 roles or having certain control over certain
1249 selections; providing an exception; amending s.
1250 629.261, F.S.; requiring the office to revoke certain
1251 authorization under certain circumstances; prohibiting
1252 insurers subject to such action from issuing or
1253 renewing nonassessable policies or converting
1254 assessable policies to nonassessable policies;
1255 providing that specified provisions apply to such
1256 insurers; deleting provisions regarding the office’s
1257 authority to issue a certificate authoring the insurer
1258 to extinguish the contingent liability of subscribers;
1259 deleting a prohibition regarding the office’s
1260 authorization to extinguish the contingent liability
1261 of certain subscribers; amending s. 629.291, F.S.;
1262 providing that certain insurers that merge are
1263 governed by the insurance code; prohibiting domestic
1264 stock insurers from being converted to reciprocal
1265 insurers; requiring that specified plans be filed with
1266 the office and that such plans contain certain
1267 information; deleting a provision regarding a stock or
1268 mutual insurer’s capital and surplus requirements and
1269 rights; authorizing the conversion of assessable
1270 reciprocal insurers to nonassessable reciprocal
1271 insurers under certain circumstances; creating s.
1272 629.525, F.S.; requiring the commission to adopt,
1273 amend, or repeal certain rules; amending ss. 163.01
1274 and 626.9531, F.S.; conforming cross-references;
1275 providing effective dates.