ENROLLED 2023 Legislature CS for CS for CS for SB 418, 1st Engrossed 2023418er 1 2 An act relating to insurance; amending s. 327.54, 3 F.S.; revising requirements relating to insurance for 4 liveries that lease or rent or offer to lease or rent 5 livery vessels; amending s. 624.4621, F.S.; specifying 6 a qualification for a local governmental entitys 7 representative on a self-insurers governing body; 8 amending s. 627.062, F.S.; authorizing residential 9 property insurance rate filings to use a specified 10 modeling indication; amending s. 627.0628, F.S.; 11 revising membership requirements for specified members 12 of the Florida Commission on Hurricane Loss Projection 13 Methodology; amending s. 627.0629, F.S.; authorizing 14 insurers to file with the Office of Insurance 15 Regulation personal lines residential property 16 insurance rating plans providing rate differentials 17 based on certain windstorm mitigation construction 18 standards; providing requirements for such plans; 19 amending s. 627.0665, F.S.; revising the timeframe for 20 advance notices from insurers to insureds of automatic 21 bank withdrawal increases; specifying the increase 22 threshold for such notices; amending s. 627.421, F.S.; 23 revising the types of documents and kinds of insurance 24 for which electronic transmission constitutes delivery 25 to the insured or person entitled to delivery; 26 deleting a requirement to include a certain notice to 27 an insured electing to receive policy documents 28 electronically; deleting a requirement to provide a 29 paper copy of the policy upon request by such person; 30 amending s. 627.701, F.S.; revising and specifying 31 alternative hurricane deductible amounts for personal 32 lines residential property insurance policies covering 33 risks with specified dwelling limits; amending s. 34 627.712, F.S.; providing that a policyholders written 35 exclusion from residential windstorm coverage or 36 contents coverage may be typed rather than 37 handwritten; amending s. 627.7276, F.S.; revising the 38 requirements for the notice of limited coverage under 39 certain automobile policies; amending s. 634.041, 40 F.S.; specifying the manner in which a contractual 41 liability insurance policy of a service agreement 42 company may pay claims; providing an effective date. 43 44 Be It Enacted by the Legislature of the State of Florida: 45 46 Section 1.Subsection (7) of section 327.54, Florida 47 Statutes, is amended to read: 48 327.54Liveries; safety regulations; penalty. 49 (7)A livery may not lease or rent or offer to lease or 50 rent any livery vessel unless the livery: first 51 (a)Obtains and carries in full force and effect a policy 52 from a licensed insurance carrier in this state which insures 53 the livery and the renter against any accident, loss, injury, 54 property damage, or other casualty caused by or resulting from 55 the operation of the livery vessel. The insurance policy must 56 provide coverage of at least $500,000 per person and $1 million 57 per event. The livery shall have proof of such insurance 58 available for inspection at the location where livery vessels 59 are being leased or rented, or offered for lease or rent, and 60 shall provide to each renter the insurance carriers name and 61 address and the insurance policy number; and 62 (b)Either: 63 1.Obtains and carries in full force and effect a policy 64 from a licensed insurance carrier in this state which insures 65 the renter in the same manner and amounts of the policy obtained 66 by the livery under paragraph (a) and provides to each renter 67 the insurance carriers name and address and the insurance 68 policy number; or 69 2.Presents the renter with the opportunity to purchase 70 coverage which insures the renter against any accident, loss, 71 injury, property damage, or other casualty caused by or 72 resulting from the operation of the livery vessel of at least 73 $500,000 per person and $1 million per event. If a renter 74 chooses not to purchase the coverage, the livery must obtain a 75 signed acknowledgement from the renter which includes an 76 attestation as to whether the renter has a Florida boating 77 safety identification card issued by the commission, a temporary 78 certificate, or another form of boating certification authorized 79 pursuant to s. 327.395, and that includes the following 80 statement: 81 82 I UNDERSTAND THAT I AM REFUSING TO PURCHASE A VESSEL 83 RENTAL INSURANCE POLICY FOR COVERAGE OF AT LEAST 84 $500,000 PER PERSON AND $1 MILLION PER EVENT FOR ANY 85 DAMAGE OR INJURIES CAUSED DIRECTLY OR INDIRECTLY BY MY 86 OPERATION OF THE VESSEL. 87 88 THE VESSEL RENTAL INSURANCE POLICY COVERAGE IS BEING 89 OFFERED TO ME AT THE FOLLOWING PRICE: [INSERT BINDABLE 90 PRICE HERE OF INSURANCE BEING DECLINED]. 91 92 I UNDERSTAND THAT I MAY NOT HAVE OTHER INSURANCE TO 93 COVER ANY DAMAGE OR INJURIES CAUSED DIRECTLY OR 94 INDIRECTLY BY MY OPERATION OF THE VESSEL AND THAT I 95 MAY BE PERSONALLY LIABLE FOR ANY SUCH DAMAGE OR 96 INJURIES DURING THE RENTAL PERIOD. 97 98 This subsection does not apply to human-powered vessels. 99 Section 2.Subsection (12) is added to section 624.4621, 100 Florida Statutes, to read: 101 624.4621Group self-insurance funds. 102 (12)For any local governmental entity that is a member of 103 a self-insurer established under this section, only an elected 104 official of the local governmental entity may be the local 105 governmental entitys representative on the self-insurers 106 governing body. 107 Section 3.Paragraph (j) of subsection (2) of section 108 627.062, Florida Statutes, is amended to read: 109 627.062Rate standards. 110 (2)As to all such classes of insurance: 111 (j)With respect to residential property insurance rate 112 filings, the rate filing: 113 1.Must account for mitigation measures undertaken by 114 policyholders to reduce hurricane losses. 115 2.May use a modeling indication that is the weighted or 116 straight average of two or more hurricane loss projection models 117 found by the Florida Commission on Hurricane Loss Projection 118 Methodology to be accurate or reliable pursuant to s. 627.0628. 119 120 The provisions of this subsection do not apply to workers 121 compensation, employers liability insurance, and motor vehicle 122 insurance. 123 Section 4.Paragraph (b) of subsection (2) of section 124 627.0628, Florida Statutes, is amended to read: 125 627.0628Florida Commission on Hurricane Loss Projection 126 Methodology; public records exemption; public meetings 127 exemption. 128 (2)COMMISSION CREATED. 129 (b)The commission shall consist of the following 12 130 members: 131 1.The insurance consumer advocate. 132 2.The senior employee of the State Board of Administration 133 responsible for operations of the Florida Hurricane Catastrophe 134 Fund. 135 3.The Executive Director of the Citizens Property 136 Insurance Corporation or the executive directors designee. The 137 executive directors designee must be a full-time employee of 138 the corporation and have actuarial science experience. 139 4.The Director of the Division of Emergency Management or 140 the directors designee. The directors designee must be a full 141 time employee of the division. 142 5.The actuary member of the Florida Hurricane Catastrophe 143 Fund Advisory Council. 144 6.An employee of the office who is an actuary responsible 145 for property insurance rate filings and who is appointed by the 146 director of the office. 147 7.Five members appointed by the Chief Financial Officer, 148 as follows: 149 a.An actuary who is employed full time by a property and 150 casualty insurer that was responsible for at least 1 percent of 151 the aggregate statewide direct written premium for homeowner 152 insurance in the calendar year preceding the members 153 appointment to the commission. 154 b.An expert in insurance finance who is a full-time member 155 of the faculty of the State University System and who has a 156 background in actuarial science. 157 c.An expert in statistics who is a full-time member of the 158 faculty of the State University System and who has a background 159 in insurance. 160 d.An expert in computer system design who is a full-time 161 member of the faculty of the State University System. 162 e.An expert in meteorology who is a full-time member of 163 the faculty of the State University System and who specializes 164 in hurricanes. 165 8.A licensed professional structural engineer who is a 166 full-time faculty member in the State University System and who 167 has expertise in wind mitigation techniques. This appointment 168 shall be made by the Governor. 169 Section 5.Subsection (9) is added to section 627.0629, 170 Florida Statutes, to read: 171 627.0629Residential property insurance; rate filings. 172 (9)An insurer may file with the office a personal lines 173 residential property insurance rating plan that provides 174 justified premium discounts, credits, or other rate 175 differentials based on windstorm mitigation construction 176 standards developed by an independent, nonprofit scientific 177 research organization, if such standards meet the requirements 178 of this section. Such plan must describe the manner in which the 179 insurer will document the existence of the mitigation features 180 and premium discounts, credits, or other rate differentials 181 created under such plan. 182 Section 6.Section 627.0665, Florida Statutes, is amended 183 to read: 184 627.0665Automatic bank withdrawal agreements; notification 185 required.Any insurer licensed to issue insurance in the state 186 who has an automatic bank withdrawal agreement with an insured 187 party for the payment of insurance premiums for any type of 188 insurance shall give the named insured at least 10 15 days 189 advance written notice of any increase in policy premiums which 190 results in the next automatic bank withdrawal being increased by 191 more than $10. Such notice must be provided before prior to any 192 automatic bank withdrawal containing the of an increased 193 premium. 194 Section 7.Subsection (1) of section 627.421, Florida 195 Statutes, is amended to read: 196 627.421Delivery of policy. 197 (1)Subject to the insurers requirement as to payment of 198 premium, every policy shall be mailed, delivered, or 199 electronically transmitted to the insured or to the person 200 entitled thereto not later than 60 days after the effectuation 201 of coverage. Notwithstanding any other provision of law, an 202 insurer may allow a policyholder of personal lines insurance to 203 affirmatively elect delivery of the policy documents, including, 204 but not limited to, policies, endorsements, notices, or 205 documents, by electronic means in lieu of delivery by mail. 206 Electronic transmission of a policy, related notices, and other 207 documents for individual and group health insurance policies or 208 certificates of coverage pursuant to parts VI and VII of this 209 chapter, respectively; health maintenance contracts or 210 certificates of coverage pursuant to part I of chapter 641; 211 prepaid limited health service contracts pursuant to part I of 212 chapter 636; and for commercial risks, including, but not 213 limited to, workers compensation and employers liability, 214 commercial automobile liability, commercial automobile physical 215 damage, commercial lines residential property, commercial 216 nonresidential property, farmowners insurance, and the types of 217 commercial lines risks set forth in s. 627.062(3)(d), 218 constitutes delivery to the insured or to the person entitled to 219 delivery, unless the insured or the person entitled to delivery 220 communicates to the insurer in writing or electronically that he 221 or she does not agree to delivery by electronic means. 222 Electronic transmission shall include a notice to the insured or 223 to the person entitled to delivery of a policy of his or her 224 right to receive the policy via United States mail rather than 225 via electronic transmission. A paper copy of the policy shall be 226 provided to the insured or to the person entitled to delivery at 227 his or her request. 228 Section 8.Paragraph (d) of subsection (3) of section 229 627.701, Florida Statutes, is amended, and paragraph (a) of that 230 subsection is republished, to read: 231 627.701Liability of insureds; coinsurance; deductibles. 232 (3)(a)Except as otherwise provided in this subsection, 233 prior to issuing a personal lines residential property insurance 234 policy, the insurer must offer alternative deductible amounts 235 applicable to hurricane losses equal to $500, 2 percent, 5 236 percent, and 10 percent of the policy dwelling limits, unless 237 the specific percentage deductible is less than $500. The 238 written notice of the offer shall specify the hurricane 239 deductible to be applied in the event that the applicant or 240 policyholder fails to affirmatively choose a hurricane 241 deductible. The insurer must provide such policyholder with 242 notice of the availability of the deductible amounts specified 243 in this subsection in a form approved by the office in 244 conjunction with each renewal of the policy. The failure to 245 provide such notice constitutes a violation of this code but 246 does not affect the coverage provided under the policy. 247 (d)For the following policies, the following alternative 248 deductible amounts are authorized: 249 1.With respect to a policy covering a risk with dwelling 250 limits of $250,000 or more, the insurer need not offer the $500 251 hurricane deductible as required by paragraph (a), but must, 252 except as otherwise provided in this subsection, offer the other 253 hurricane deductibles as required by paragraph (a). 254 2.With respect to a policy covering a risk with dwelling 255 limits of $1 million or more, but less than $3 million, the 256 insurer may, in lieu of offering the 2 percent deductible as 257 required by paragraph (a), offer a deductible amount applicable 258 to hurricane losses equal to 3 percent of the policy dwelling 259 limits. 260 3.With respect to a policy covering a risk with dwelling 261 limits of $3 million or more, the insurer need not offer the 2 262 percent deductible as required by paragraph (a), but must, 263 except as otherwise provided by this subsection, offer the other 264 hurricane deductibles as required by paragraph (a). 265 Section 9.Paragraph (a) of subsection (2) and subsection 266 (3) of section 627.712, Florida Statutes, are amended to read: 267 627.712Residential windstorm coverage required; 268 availability of exclusions for windstorm or contents. 269 (2)A property insurer must make available, at the option 270 of the policyholder, an exclusion of windstorm coverage. 271 (a)The coverage may be excluded only if: 272 1.When the policyholder is a natural person, the 273 policyholder personally writes or types and provides to the 274 insurer the following statement in his or her own handwriting 275 and signs his or her name, which must also be signed by every 276 other named insured on the policy, and dated: I do not want the 277 insurance on my (home/mobile home/condominium unit) to pay for 278 damage from windstorms. I will pay those costs. My insurance 279 will not. 280 2.When the policyholder is other than a natural person, 281 the policyholder provides to the insurer on the policyholders 282 letterhead the following statement that must be signed by the 283 policyholders authorized representative and dated: ...(Name of 284 entity)... does not want the insurance on its ...(type of 285 structure)... to pay for damage from windstorms. ...(Name of 286 entity)... will be responsible for these costs. ...(Name of 287 entitys)... insurance will not. 288 (3)An insurer issuing a residential property insurance 289 policy, except for a condominium unit owner policy or a tenant 290 policy, must make available, at the option of the policyholder, 291 an exclusion of coverage for the contents. The coverage may be 292 excluded only if the policyholder personally writes or types and 293 provides to the insurer the following statement in his or her 294 own handwriting and signs his or her signature, which must also 295 be signed by every other named insured on the policy, and dated: 296 I do not want the insurance on my (home/mobile home) to pay for 297 the costs to repair or replace any contents that are damaged. I 298 will pay those costs. My insurance will not. 299 Section 10.Section 627.7276, Florida Statutes, is amended 300 to read: 301 627.7276Notice of limited coverage. 302 (1)An automobile policy that does not contain coverage for 303 bodily injury and property damage must include a notice be 304 clearly stamped or printed to the effect that such coverage is 305 not included in the policy in the following manner: 306 307 THIS POLICY DOES NOT PROVIDE BODILY INJURY AND 308 PROPERTY DAMAGE LIABILITY INSURANCE OR ANY OTHER 309 COVERAGE FOR WHICH A SPECIFIC PREMIUM CHARGE IS NOT 310 MADE, AND DOES NOT COMPLY WITH ANY FINANCIAL 311 RESPONSIBILITY LAW. 312 313 (2)This notice legend must appear on the policy 314 declaration page and on the filing back of the policy and be 315 printed in bold type a contrasting color from that used on the 316 policy and in type larger than the largest type used in the text 317 thereof, as an overprint or by a rubber stamp impression. 318 Section 11.Paragraph (b) of subsection (8) of section 319 634.041, Florida Statutes, is amended to read: 320 634.041Qualifications for license.To qualify for and hold 321 a license to issue service agreements in this state, a service 322 agreement company must be in compliance with this part, with 323 applicable rules of the commission, with related sections of the 324 Florida Insurance Code, and with its charter powers and must 325 comply with the following: 326 (8) 327 (b)A service agreement company does not have to establish 328 and maintain an unearned premium reserve if it secures and 329 maintains contractual liability insurance in accordance with the 330 following: 331 1.Coverage of 100 percent of the claim exposure is 332 obtained from an insurer approved by the office, which holds a 333 certificate of authority under s. 624.401 to do business within 334 this state, or secured through a risk retention group, which is 335 authorized to do business within this state under s. 627.943 or 336 s. 627.944. Such insurer or risk retention group must maintain a 337 surplus as regards policyholders of at least $15 million. 338 2.If the service agreement company does not meet its 339 contractual obligations, the contractual liability insurance 340 policy binds its issuer to pay or cause to be paid to the 341 service agreement holder all legitimate claims and cancellation 342 refunds for all service agreements issued by the service 343 agreement company while the policy was in effect. This 344 requirement also applies to those service agreements for which 345 no premium has been remitted to the insurer. 346 3.If the issuer of the contractual liability policy is 347 fulfilling the service agreements covered by the contractual 348 liability policy and the service agreement holder cancels the 349 service agreement, the issuer must make a full refund of 350 unearned premium to the consumer, subject to the cancellation 351 fee provisions of s. 634.121(3). The sales representative and 352 agent must refund to the contractual liability policy issuer 353 their unearned pro rata commission. 354 4.The policy may not be canceled, terminated, or 355 nonrenewed by the insurer or the service agreement company 356 unless a 90-day written notice thereof has been given to the 357 office by the insurer before the date of the cancellation, 358 termination, or nonrenewal. 359 5.The service agreement company must provide the office 360 with the claims statistics. 361 6.A policy issued in compliance with this paragraph may 362 either pay 100 percent of claims as they are incurred or pay 100 363 percent of claims due in the event of the failure of the service 364 agreement company to pay such claims when due. 365 366 All funds or premiums remitted to an insurer by a motor vehicle 367 service agreement company under this part shall remain in the 368 care, custody, and control of the insurer and shall be counted 369 as an asset of the insurer; provided, however, this requirement 370 does not apply when the insurer and the motor vehicle service 371 agreement company are affiliated companies and members of an 372 insurance holding company system. If the motor vehicle service 373 agreement company chooses to comply with this paragraph but also 374 maintains a reserve to pay claims, such reserve shall only be 375 considered an asset of the covered motor vehicle service 376 agreement company and may not be simultaneously counted as an 377 asset of any other entity. 378 Section 12.This act shall take effect July 1, 2023.