Florida Senate Committees Pass Three Insurance-Related Bills Today, March 22
Mar 22, 2011
During committee meetings held today, March 22, 2011, the Florida Senate considered several insurance-related bills. Following are summaries of those bills and the Committees’ actions on each:
By a vote of 12 to 8, CS/CS/SB 408 by Senator Garrett Richter (R-Naples) was passed by the Senate Committee on Budget with one amendment by Senator Mike Fasano (R-New Port Richey). CS/CS/SB 408 is the omnibus property bill that addresses several critical issues facing Florida’s insurance marketplace.
From CS/CS/SB 408, Senator Fasano’s amendment removed a very important provision that would have allowed insurers to pay the actual cash value of a claim up front and pay the remainder once the policyholder demonstrates that repairs are made.
Along with the bill sponsor, Senator Richter, insurance industry representatives testified in opposition to Senator Fasano’s amendment. However, the amendment was adopted by a vote of 13 to 7, following a lengthy discussion among the Committee members.
Of note, the bill was not passed as a committee substitute because several amendments that had been filed to it were not considered. This means that Senator Fasano’s amendment will travel with the bill rather than be incorporated into it. Procedurally, this is expected to make removing the amendment easier.
CS/CS/SB 408 must next proceed to the Senate Committee on Rules.
SB 1816 relating to Surplus Lines Insurance by Senator Fasano was passed unanimously by the Senate Committee on Banking and Insurance with three technical amendments.
Under the Nonadmitted and Reinsurance Reform Act of 2010 (“NRRA”) Florida will no longer have jurisdiction to collect taxes and fees on surplus lines policies that cover risks over multiple states unless Florida is the home state of the risk. This is expected to cost Florida approximately $20 million in the loss of insurance premium tax collections.
However, the NRRA authorizes states to enter agreements with one another that provide for the collection of taxes on multi-state risks by the home state, which would then allocate the tax revenue to the appropriate state. Thus, SB 1816 authorizes the Florida Department of Financial Services and the Office of Insurance Regulation to enter into cooperative reciprocal agreements with other states to collect and allocate nonadmitted insurance taxes for multistate risks pursuant to the NRRA.
Senate Bill 1568 relating to Insurer Insolvency by Senator Bill Montford (D-Tallahassee) also unanimously passed the Banking and Insurance with a strike-everything amendment sponsored by Senator Mike Bennett (R-Bradenton). The bill amends several parts of chapter 631, F.S. relating to the rehabilitation and liquidation of Florida insurers.
Should you have any question or comments, please contact Colodny Fass.