Bills Presented to Governor Crist This Week

The following insurance-related bills were presented to Governor Charlie Crist on June 4, 2007.  The Governor has until June 19, 2007 to sign or veto these bills. If the Governor does not act by that date, then the bills will become law automatically.

Senate Bill 2198 by Senator Don Gaetz (R-Niceville) Relating to Insurer Financial Statements. This bill revises certain requirements for annual statements; revises certain requirements for annual audited financial statements. This bill is effective July 1, 2007.

Senate Bill1894 by Senator Bill Posey (R-Rockledge) Relating to Joint Underwriting Plan/Workers’ Compensation. This bill provides requirements for joint underwriting plan of insurers which operates as Florida Workers’ Compensation Joint Underwriting Association (“FWCJUA”); revises restrictions on who may serve on the FWCJUA Board; requires that the market assistance plan be periodically reviewed and updated; requires that excess funds received by plan be returned to the State; provides for applicability of specified statutes regulating ethical standards, etc. This bill is effective July 1, 2007.

Senate Bill 2498 by Senator Rudy Garcia (R-Miami) Relating to Hurricane Preparedness and Insurance. This bill makes several changes to the laws regarding Citizens Property Insurance Corporation (“Citizens”). The bill contains many revisions characterized as “glitches” from the legislation passed during the January 2007 Special Session. More specifically, the bill:

• Emphasizes the need for affordable property insurance to be provided by Citizens
• Lowers the threshold to be eligible for Citizens coverage when the premium for comparable coverage from a private insurer is 15% greater than that of Citizens. Previously, the threshold was 25%.
• Provides that effective December 31, 2008, new certificates of authority (COAs) may not be issued to a Florida domestic residential property insurer that is a wholly-owned subsidiary of an insurer authorized to conduct business in another state (prohibits new “pup” companies). Further, rate filings for “pup” companies must include information relating to the profits of the parent company of the Florida domestic insurer.
• Clarifies that “pup” companies that are wholly-owned subsidiaries of a parent company domiciled in another state are required to maintain $50 million in surplus;
• Extends the Citizens rate freeze through 2008
• Provides an exception to insurers writing only manufactured housing policies in the state to obtain a $7 million surplus note even if the insurer applies for the surplus note after July 1, 2006 but before June 1, 2007. To be eligible, the insurer must write at least 40 percent of its policies covering manufactured housing. The bill also gives priority to the insurer writing the highest percentage of its policies covering manufactured housing.
• Clarifies that limited apportionment companies, companies participating in the Capital Incentive Build-Up Program, and companies that bought supplemental Florida Hurricane Catastrophe Fund (FHCF) coverage in 2006 will qualify for the same supplemental coverage in 2007.
• Extends the exemption for medical malpractice insurance from FHCF emergency assessments to May 31, 2010
• Requires that insurers pay or deny a claim or a portion of the claim within 90 days of receiving notice of the claim. Further, any portion of the claim not paid within 90 days will be subject interest unless there are factors beyond the control of the insurer which reasonably prevent payment.
• Amends the definition of “diligent effort” by allowing insureds who have residential homes with a replacement cost of $1 million or more to be eligible for surplus lines if they have been rejected once by a private insurer
• Creates the Florida Catastrophic Storm Risk Management Center at Florida State University to promote and disseminate research on catastrophic storm loss and to assist in securing grant funding for research
• Requires an insurance agent to provide written notice that Citizens coverage may be available and less expensive than surplus lines coverage, but the notice must also state that Citizens coverage may be less comprehensive and the policyholder may be subject to higher assessments
• Provides that all filings made or submitted after January 25, 2007, but before December 31, 2008 must make a “file and use” filing. This provision does not apply to policies for motor vehicle insurance
• Extends the ineligibility for Citizens coverage on property insured for $1 million or more to January 1, 2009, rather than July 1, 2008;
• Clarifies several provisions relating to the Florida Insurance Guarantee Association (FIGA). The bill permits all municipalities and counties in the state to issue bonds to assist FIGA. Currently, only counties and municipalities that are substantially affected by a hurricane have that authority. Amends the powers and duties of FIGA such that insureds rendered insolvent by the effects of a hurricane can use emergency assessments for the direct payment of covered claims. The bill exempts any kind of self-insurance fund, liability pool, or risk management fund from coverage by FIGA.
• Defines “non payment of premium” as the failure of the named insured to discharge when premium payments are due as well as bouncing a check
• Authorizes, but does not mandate, that the Florida Office of Insurance Regulation can establish a pilot program to offer optional sinkhole coverage
• Provides an exemption for notice of cancellation, nonrenewal or renewal premium for revisions in sinkhole coverage and policies nonrenewed by Citizens when the policies have been assumed by an authorized insurer
• Provides that effective August 1, 2007, a renewal premium must specify the dollar amount recouped for assessments by the FHCF, Citizens, and FIGA and the dollar amount of any premium increase that is due to an approved rate increase and coverage changes
• Provides that an insurer must make available windstorm coverage, but also offer an exclusion for windstorm coverage at the option of the policyholder
• Creates the Citizens Property Insurance Corporation Mission Review Task Force to return Citizens to its former role as a noncompetitive corporation. The bill appropriates $600,000 for this task force for 2007-2008.

Senate Bill 2114 by Senator Nan Rich (D-Sunrise) Relating to Independent Living Transition Services. This bill limits the liability of a caseworker who signs an application for a driver’s license for minor who is in foster care; revises eligibility criteria for independent living transition services and for Road-to-Independence Program; increases the age limit for eligibility for certain persons to qualify for medical assistance payments; provides for removal of disabilities of certain minors for purposes of securing depository financial services, etc.  This bill is effective July 1, 2007.

Senate Bill 252 by Senator Dave Aronberg (D-Greenacres) Relating to Business Filings. This bill deletes certain authorized words or abbreviations in limited liability company names; requires name of said company in company’s articles of organization to satisfy certain requirements; provides scope of Uniform Commercial Code; provides that course of performance and course of dealing may be used for certain purposes; deletes filing fees for electronically filing financing statement or amendment thereto, etc.  This bill is effective January 1, 2008.

Senate Bill 562 by Senator Mike Fasano (R-New Port Richey) Relating to Ownership or Transfer of Securities. This bill revises notice and filing requirements and provides additional grounds for exemption from provisions regarding acquisition of controlling stock; revises provisions authorizing domestic insurers’ ownership or transfer of certain securities without physical delivery of certificates; modifies reference date of Insurance Holding Company System Regulatory Act and Insurance Holding Company System Model Regulation of National Association of Insurance Commissioners, etc. This bill is effective upon becoming law.

Senate Bill 666 by Senator Mike Fasano (R-New Port Richey) Relating to Fiscal Intermediary Services Organizations/Health Care.  This bill redefines the term “fiscal intermediary services organization” for purposes of provisions governing organizations that manage business affairs of health care professionals; provides exception from requirement to obtain bonds; revises compliance requirements for registration as fiscal intermediary services organization, etc. This bill is effective October 1, 2007.

Senate Bill 902 by Senator Dennis Jones (R-Seminole) Relating to Community Associations. This bill provides for revival of certain covenants that have lapsed; prohibits local governments from limiting access of certain persons to beaches adjacent to or adjoining condominium property; requires an association to provide certain information to prospective purchasers or lienholders; provides for architectural control covenants & parcel owner improvements; revises provisions regarding dispute resolution, etc.  This bill is effective July 1, 2007 except as otherwise provided.

Additional bills presented to the Governor this week are:

SB 0108 Relating to Minority & Underrepresented Student Achievement    Senator Tony Hill

SB 0122 Relating to Child Custody/Not Modifying Child Custody    Senator Bill Posey

SB 0134 Relating to Cardrooms/Dominoes    Senator Larcenia Bullard

SB 0184 Relating to Strangulation/Domestic Battery    Senator Paula Dockery

SB 0282 Relating to Designated Drivers    Senator Mike Fasano

SB 0400 Relating to Landlord/Possession of Dwelling Unit    Senator Gwen Margolis

SB 0426 Relating to Ads/False, Deceptive, Misleading    Senator Burt Saunders

SB 0640 Relating to Public Accountancy/Licensure    Senator Mike Haridopolos

SB 0668 Relating to Surplus State Lands/Reconveyance     Senator Mike Fasano

SB 0672 Relating to Credit Balances/Unclaimed Property    Senator Mike Fasano

SB 1004 Relating to Cybercrimes Against Children Act of 2007    Senator Nancy Argenziano

SB 1456 Relating to Sales Tax/School Supplies & Clothing    Senator Dan Webster

SB 1700 Relating to Physician Assistants/Paramedic Cert.    Senator Dave Aronberg

SB 1824 Relating to Mortgages     Senator Mike Fasano

SB 1844 Relating to Homeowner’s Associations    Senator Jeremy Ring

SB 2142 Relating to Protecting Florida’s Investments Act    Senator Ted Deutch

SB 2224 Relating to Local Governments/Authorized Investments    Senator Nan Rich

 

Please do not hesitate to contact this office should you have any specific questions regarding these matters.