Update: House Policy & Budget Council Amends and Approves Insurance Capital Build-Up Incentive Program Bill

Update:  Copies of HB 5057 and accompanying amendments considered today by the House of Representatives Policy and Budget Council are attached for your review.

Today, April 3, 2008, the House of Representatives Policy and Budget Council (“Council”) amended and approved Committee Substitute/House Bill 5057 by the House Jobs and Entrepreneurship Council and Representative Ron Reagan.  To view the Council meeting packet, click here. 

Copies of the bill and amendments approved today by the Council are attached for your review.

HB 5057, relating to the Insurance Capital Build-Up Incentive Program (“Program”), provides for an appropriation of state funds in exchange for surplus notes issued by residential property insurers; revises conditions and requirements for providing funds to insurers; requires commitment by insurers to meet minimum premium-to-surplus writing ratios for residential property insurance and for taking policies out of Citizens Property Insurance Corporation (“Citizens”); authorizes the State Board of Administration (“SBA”) to charge fees for late payments; provides that amendments made by act do not affect terms of surplus notes approved prior to specified date; authorizes the SBA and insurers to renegotiate such terms consistent with such amendments; requires Citizens to transfer funds to the General Revenue Fund for appropriation by the Florida Legislature for program purposes. Effective Date: July 1, 2008

Created in 2006, the Program was designed to encourage private insurance companies to invest in Florida by providing a low-cost surplus note of up to $25 million for approved companies.

CS/HB 5057 would extend the program until September, 2008. An amendment adopted by the Council onto the bill this morning would require Citizens to loan $250 million from its surplus to fund the Program.

Additionally, the amendment will allow companies that received a surplus note in 2007 to renegotiation the terms of their note to be consistent with the terms for the 2008 program.

 

Should you have any questions or comments, please do not hesitate to contact this office.

 

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