Florida Cabinet Approves Insurance-Related Rules; Re-Appoints Randy Dumm as Florida Commission on Hurricane Loss Projection Methodology Chair

 

The Florida Cabinet met on August 10, 2010, during which it considered various insurance-related matters.  To view the complete agenda, which includes hyperlinks to individual agency agendas, click here.

Following is a brief summary of those items and the corresponding discussions that took place during the meeting. 

 

Florida Office of Insurance Regulation

Florida Office of Insurance Regulation (“OIR”) Deputy Commissioner Belinda Miller presented the following items for consideration by the Cabinet members, who assumed their role as the Financial Services Commission (“FSC”) for this portion of the agenda:

The two proposed Rules listed below were approved for final adoption without discussion:

• Rule 69O-137.002: Annual Audited Financial Reports (Also known as the “Model Audit Rule”)—Section 624.424(8)(e), F.S. provides that the FSC must adopt regulations in substantial conformity with the 1998 National Association of Insurance Commissioners (“NAIC”) Model Audit Rule or subsequent amendments.  Amendments adopted revise Rule 69O-137.002, the purpose of which is to improve the OIR’s surveillance of insurers’ financial condition and conform the existing Rule to the NAIC’s subsequent Model Audit Rule amendments.  The interstate uniformity resulting from the adoption is expected to reduce the cost of doing business in Florida.  Also, substantial conformity of these amendments to the Model Audit Rule is also required for NAIC accreditation.

• Rule 69O-167.024: Rate Filings for Inland Marine Insurance–Revisions to Rule 69O-167.024, which effect a renumbering, were technical and non-substantive as required by the Florida Legislature.

The proposed Rules listed below were approved for publication, also without discussion:

• Proposed Rule 69O-162.203: Adoption of 2001 Commissioners Standard Ordinary (CSO) Preferred Mortality Tables for Determining Reserve Liabilities for Ordinary Life Insurance–Rule 69O-162.203 is being amended due to changes having been made to the corresponding NAIC Model Regulation. The amendment explains the conditions for use of the preferred class structure mortality tables and permits their use for policies issued prior to the adoption date of the original Rule.

• Proposed Rule 69O-164.020: Valuation of Life Insurance Policies–Proposed Rule 69O-164.020 is being amended to adopt changes made to the corresponding NAIC Model Regulations.  Subject to certain conditions, the amendment reduces the minimum premium deficiency reserve requirement to ensure its adequacy.

• Proposed Rule 69O-138.047: Description of Actuarial Memorandum Including an Asset Adequacy Analysis and Regulatory Asset Adequacy Issues Summary–Proposed Rule 69O-138.047 is being amended due to changes having made to corresponding NAIC Model Regulations. The amendment, which relates to actuarial principles for the calculation of statutory assets, adds an additional requirement to the Regulatory Asset Adequacy Issues Summary as a result of changes to Rules 69O-162.203 and 69O-164.020, F.A.C. 

 

State Board of Administration

The Florida State Board of Administration  (“SBA”) met during the Cabinet meeting to approve the reappointment of Dr. Randy Dumm as Florida Commission on Hurricane Loss Projection Methodology Chairman.  Florida law requires the SBA to appoint a Commission member to serve as chair each year.

The next Cabinet meeting is scheduled for Thursday, August 26, 2010.

 

 

Should you have any questions or comments, please contact Colodny Fass.