The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Banking and Insurance
BILL: SPB 7016
INTRODUCER: Banking and Insurance Committee
SUBJECT: OGSR/Information Submitted by Insurers/Department of Financial Services
DATE: December 2, 2021
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Arnold Knudson BI Submitted as Comm. Bill/Fav
I. Summary:
SPB 7016 continues the public records exemption for certain information submitted to the
Department of Financial Services (DFS) related to an insurer’s anti-fraud plan or annual fraud
report pursuant to s. 626.9891, F.S., by removing the October 2, 2022, repeal date.
Currently, s. 626.9891, F.S., provides that certain information submitted to DFS related to an
insurer’s anti-fraud plan or annual fraud report is exempt from s. 119.07(1), F.S., and article I,
section 24 of the Florida Constitution.
Pursuant to the Open Government Sunset Review (OGSR), the public records exemption is
scheduled to repeal October 2, 2022, unless reenacted by the Legislature. Since the bill continues
the exemption and does not expand the scope of the public records exemption, the bill requires a
majority vote of each chamber for passage.
This bill takes effect October 1, 2022.
II. Present Situation:
Public Records Law
The Florida Constitution provides that the public has the right to inspect or copy records made or
received in connection with official governmental business.
1
This applies to the official business
of any public body, officer, or employee of the state, including all three branches of state
government, local governmental entities, and any person acting on behalf of the government.
2
Chapter 119, F.S., known as the Public Records Act, constitutes the main body of public records
laws.
3
The Public Records Act states that:
1
FLA. CONST., art. I, s. 24(a).
2
Id.
3
Public records laws are found throughout the Florida Statutes.
REVISED: BILL: SPB 7016 Page 2
[i]t is the policy of this state that all state, county, and municipal records are open
for personal inspection and copying by any person. Providing access to public
records is a duty of each agency.
4
The Public Records Act typically contains general exemptions that apply across agencies.
Agency- or program-specific exemptions often are placed in the substantive statutes
relating to that particular agency or program.
The Public Records Act does not apply to legislative or judicial records.
5
Legislative records are
public pursuant to s. 11.0431, F.S. Public records exemptions for the Legislature are codified
primarily in s. 11.0431(2)-(3), F.S., and adopted in the rules of each house of the legislature.
Section 119.011(12), F.S., defines “public records” to include:
All documents, papers, letters, maps, books, tapes, photographs, films,
sound recordings, data processing software, or other material, regardless of
the physical form, characteristics, or means of transmission, made or
received pursuant to law or ordinance or in connections with the transaction
of official business by any agency.
The Florida Supreme Court has interpreted this definition to encompass all materials made or
received by an agency in connection with official business which are used to “perpetuate,
communicate, or formalize knowledge of some type.”
6
The Florida Statutes specify conditions under which public access to governmental records must
be provided. The Public Records Act guarantees every person’s right to inspect and copy any
state or local government public record at any reasonable time, under reasonable conditions, and
under supervision by the custodian of the public record.
7
A violation of the Public Records Act
may result in civil or criminal liability.
8
Only the Legislature may create an exemption to public records requirements.
9
An exemption
must be created by general law and must specifically state the public necessity justifying the
exemption.
10
Further, the exemption must be no broader than necessary to accomplish the stated
purpose of the law. A bill enacting an exemption may not contain other substantive provisions
11
and must pass by a two-thirds vote of the members present and voting in each house of the
Legislature.
12
4
Section 119.01(1), F.S.
5
Locke v. Hawkes, 595 So. 2d 32, 34 (Fla. 1992); see also Times Pub. Co. v. Ake, 660 So. 2d 255 (Fla. 1995).
6
Shevin v. Byron, Harless, Schaffer, Reid and Assoc. Inc., 379 So. 2d 633, 640 (Fla. 1980).
7
Section 119.07(1)(a), F.S.
8
Section 119.10, F.S. Public records laws are found throughout the Florida Statutes, as are the penalties for violating those
laws.
9
FLA. CONST., art. I, s. 24(c).
10
Id.
11
The bill may, however, contain multiple exemptions that relate to one subject.
12
FLA. CONST., art. I, s. 24(c) BILL: SPB 7016 Page 3
When creating a public records exemption, the Legislature may provide that a record is “exempt”
or “confidential and exempt.” There is a difference between records the Legislature has
determined to be exempt from the Public Records Act and those which the Legislature has
determined to be exempt from the Public Records Act and confidential.
13
Records designated as
“confidential and exempt” are not subject to inspection by the public and may only be released
under the circumstances defined by statute.
14
Records designated as “exempt” may be released at
the discretion of the records custodian under certain circumstances.
15
Open Government Sunset Review Act
The provisions of s. 119.15, F.S., known as the Open Government Sunset Review Act (the Act),
prescribe a legislative review process for newly created or substantially amended public records
or open meetings exemptions,
16
with specified exceptions.
17
The Act requires the repeal of such
exemption on October 2nd of the fifth year after creation or substantial amendment; in order to
save an exemption from repeal, the Legislature must reenact the exemption or repeal the sunset
date.
18
In practice, many exemptions are continued by repealing the sunset date, rather than
reenacting the exemption.
The Act provides that a public records or open meetings exemption may be created or
maintained only if it serves an identifiable public purpose and is no broader than is necessary.
19
An exemption serves an identifiable purpose if it meets one of the following purposes and the
Legislature finds that the purpose of the exemption outweighs open government policy and
cannot be accomplished without the exemption:
It allows the state or its political subdivision to effectively and efficiently administer a
program, and administration would be significantly impaired without the exemption;
20
Releasing sensitive personal information would be defamatory or would jeopardize an
individual’s safety. If this public purpose is cited as the basis of an exemption, however, only
personal identifying information is exempt;
21
or
It protects trade or business secrets.
22
The Act also requires specified questions to be considered during the review process.
23
In
examining an exemption, the Act directs the Legislature to question the purpose and necessity of
reenacting the exemption.
13
WFTV, Inc. v. The Sch. Bd. of Seminole County, 874 So. 2d 48, 53 (Fla. 5
th
DCA 2004).
14
Id.
15
Williams v. City of Minneola, 575 So. 2d 683 (Fla. 5
th
DCA 1991).
16
Section 119.15, F.S. Section 119.15(4)(b), F.S., provides that an exemption is considered to be substantially amended if it
is expanded to include more records or information or to include meetings.
17
Section 119.15(2)(a) and (b), F.S., provides that exemptions required by federal law or applicable solely to the Legislature
or the State Court System are not subject to the Open Government Sunset Review Act.
18
Section 119.15(3), F.S.
19
Section 119.15(6)(b), F.S.
20
Section 119.15(6)(b)1., F.S.
21
Section 119.15(6)(b)2., F.S.
22
Section 119.15(6)(b)3., F.S.
23
Section 119.15(6)(a), F.S. The specified questions are:
What specific records or meetings are affected by the exemption?
Whom does the exemption uniquely affect, as opposed to the general public? BILL: SPB 7016 Page 4
If, in reenacting an exemption or repealing the sunset date, the exemption is expanded, then a
public necessity statement and a two-thirds vote for passage are required.
24
If the exemption is
reenacted or saved from repeal without substantive changes or if the exemption is narrowed, then
a public necessity statement and a two-thirds vote for passage are not required. If the Legislature
allows an exemption to expire, the previously exempt records will remain exempt unless
otherwise provided by law.
25
Insurer Anti-Fraud Investigative Units
Under Florida law, an admitted insurer is required to maintain a designated anti-fraud unit or
division within its company, or contract with a third party, to investigate and report possible
fraudulent insurance acts.
26
The insurer must also adopt an anti-fraud plan, file a description of
the anti-fraud plan or copy of executed contract with the Department of Financial Services (DFS)
Division of Investigative and Forensic Services (DIFS), and annually report data related to fraud
for each line of business to DFS. The Financial Services Commission, DFS, and Office of
Insurance Regulation may impose an administrative fine on a noncompliant insurer.
Each anti-fraud plan must include:
An acknowledgment that the insurer has established procedures for detecting and
investigating possible fraudulent insurance acts relating to the different types of insurance by
that insurer;
An acknowledgment that the insurer has established procedures for the mandatory reporting
of possible fraudulent insurance acts to DIFS;
An acknowledgment that the insurer provides the anti-fraud education and training required
by this section to the anti-fraud investigative unit;
A description of the required anti-fraud education and training;
A description or chart of the insurer’s anti-fraud investigative unit, including the position
titles and descriptions of staffing; and
The rationale for the level of staffing and resources being provided for the anti-fraud
investigative unit which may include objective criteria, such as the number of policies
written, the number of claims received on an annual basis, the volume of suspected
fraudulent claims detected on an annual basis, an assessment of the optimal caseload that one
investigator can handle on an annual basis, and other factors.
Each insurer is required to report the following data related to fraud for each line of business:
The number of policies in effect;
The amount of premiums written for policies;
The number of claims received;
What is the identifiable public purpose or goal of the exemption?
Can the information contained in the records or discussed in the meeting be readily obtained by alternative means?
If so, how?
Is the record or meeting protected by another exemption?
Are there multiple exemptions for the same type of record or meeting that it would be appropriate to merge?
24
FLA. CONST. art. I, s. 24(c).
25
Section 119.15(7), F.S.
26
Section 626.9891, F.S. BILL: SPB 7016 Page 5
The number of claims referred to the anti-fraud investigative unit;
The number of other insurance fraud matters referred to the anti-fraud investigative unit that
were not claim related;
The number of claims investigated or accepted by the anti-fraud investigative unit;
The number of other insurance fraud matters investigated or accepted by the anti-fraud
investigative unit that were not claim related;
The number of cases referred to DIFS;
The number of cases referred to other law enforcement agencies;
The number of cases referred to other entities; and
The estimated dollar amount or range of damages on cases referred to DIFS or other
agencies.
Section 626.9891(11), F.S., provides that certain information contained in an insurer’s anti-fraud
plan or annual fraud report submitted to DFS is exempt from s. 119.07(1) and article I, section 24
of the Florida Constitution. The following information covered by the public records exemption :
A description of the required anti-fraud education and training;
A description or chart of the insurer’s anti-fraud investigative unit, including the position
titles and descriptions of staffing;
The rationale for the level of staffing and resources being provided for the anti-fraud
investigative unit which may include objective criteria, such as the number of policies
written, the number of claims received on an annual basis, the volume of suspected
fraudulent claims detected on an annual basis, an assessment of the optimal caseload that one
investigator can handle on an annual basis, and other factors.
The number of claims referred to the anti-fraud investigative unit;
The number of other insurance fraud matters referred to the anti-fraud investigative unit that
were not claim related;
The number of claims investigated or accepted by the anti-fraud investigative unit;
The number of other insurance fraud matters investigated or accepted by the anti-fraud
investigative unit that were not claim related; and
The estimated dollar amount or range of damages on cases referred to DIFS or other
agencies.
Further, s. 626.9891(11), F.S., is subject to the Open Government Sunset Review Act and shall
stand repealed on October 2, 2022, if not reenacted.
OGSR Survey and Results
In 2021, Senate professional staff sent out a survey to DFS to ascertain whether the public
records exemption under s. 626.9891, F.S., remains necessary, pursuant to the OGSR Act.
27
DFS
indicated information subject to the public records exemption under s. 626.9891, F.S. is not
protected by another exemption or subject to multiple exemptions. DFS indicated there has been
no litigation related to s. 626.9891, F.S.
27
See DFS survey correspondence, dated November 23, 2021, on file with the Senate Committee on Banking and Insurance. BILL: SPB 7016 Page 6
DFS recommends reenacting the public records exemption without changes. Further, DFS
indicates this public records exemption is vital to prevent criminals from accessing such
information to identify fraud prevention and detection strategies used by insurers, or to be alerted
to potential or ongoing investigations. Such disclosure may assist criminals in impeding
investigations or evading detection.
III. Effect of Proposed Changes:
Section 1 amends s. 626.9891, F.S., to continue the public records exemption related to insurer
anti-fraud plans and annual fraud reports submitted to DFS.
Section 2 provides an effective date of October 1, 2022.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
None.
B. Public Records/Open Meetings Issues:
Vote Requirement
Article I, s. 24(c) of the State Constitution requires a two-thirds vote of the members
present and voting for final passage of a bill creating or expanding an exemption to the
public records requirements. This bill continues a current public records exemption
beyond its current date of repeal; thus, the bill does not require an extraordinary vote for
enactment.
Public Necessity Statement
Article I, s. 24(c) of the State Constitution requires a bill creating or expanding an
exemption to the public records requirements to state with specificity the public necessity
justifying the exemption. This bill continues a current public records exemption without
expansion.
Breadth of Exemption
Article I, s. 24(c) of the State Constitution requires an exemption to the public records
requirements to be no broader than necessary to accomplish the stated purpose of the law.
The purpose of the law is to protect the disclosure of information that would assist
perpetrators of insurance fraud in impeding investigations and evading detection. This
bill exempts only information submitted by insurers to DFS related to anti-fraud plans
and fraud reports from the public records requirements. The exemption does not appear to
be broader than necessary to accomplish the purpose of the law.
C. Trust Funds Restrictions:
None. BILL: SPB 7016 Page 7
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
None.
C. Government Sector Impact:
None.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill substantially amends section 626.9891 of the Florida Statutes.
IX. Additional Information:
A. Committee Substitute – Statement of Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
None.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.