Florida Senate - 2023 SB 7052 By the Committee on Banking and Insurance 597-03563-23 20237052__ 1 A bill to be entitled 2 An act relating to insurer accountability; amending s. 3 624.307, F.S.; authorizing electronic responses to 4 certain requests from the Division of Consumer 5 Services of the Department of Financial Services 6 concerning consumer complaints; revising the timeframe 7 in which responses must be made; revising 8 administrative penalties; amending s. 624.315, F.S.; 9 specifying reporting requirements for the Office of 10 Insurance Regulations internal auditor in the 11 offices annual report relating to the enforcement of 12 insurer compliance; creating s. 624.3152, F.S.; 13 specifying requirements for the office to report 14 quarterly to the Legislature relating to the 15 enforcement of insurer compliance; amending s. 16 624.316, F.S.; requiring the office to create a 17 specified methodology for scheduling examinations of 18 insurers; specifying requirements for such 19 methodology; providing construction; amending s. 20 624.3161, F.S.; providing that authorized property 21 insurers must, rather than may, be subject to an 22 additional market conduct examination after a 23 hurricane if specified conditions are met; revising 24 the applicability of such conditions; requiring the 25 office to create, and the Financial Services 26 Commission to adopt by rule, a specified methodology 27 for scheduling examinations of insurers; specifying 28 requirements for such methodology; providing 29 construction; amending s. 624.4211, F.S.; revising 30 administrative fines the office may impose in lieu of 31 revocation or suspension; amending s. 624.424, F.S.; 32 revising reporting requirements for insurers that pay 33 financial consideration or payment to affiliates; 34 revising factors the office must consider in 35 determining whether such financial consideration or 36 payment is fair and reasonable; specifying reporting 37 requirements for insurers relating to agreements with 38 affiliates; creating s. 624.4301, F.S.; specifying 39 requirements for insurers temporarily suspending 40 writing new policies in notifying the office; amending 41 s. 626.207, F.S.; revising a condition for 42 disqualification of an insurance representative 43 applicant or licensee; amending s. 626.9521, F.S.; 44 revising and specifying applicable fines for unfair 45 methods of competition and unfair or deceptive acts or 46 practices; amending s. 626.9541, F.S.; adding an 47 unfair claim settlement practice by an insurer; 48 prohibiting an officer or a director of an impaired 49 insurer to authorize or permit the insurer to pay a 50 bonus to any officer or director of the insurer; 51 defining the term bonus; providing a criminal 52 penalty; amending s. 626.9743, F.S.; revising 53 applicability of provisions relating to motor vehicle 54 insurance claim settlement practices; specifying 55 requirements, procedures, and authorized actions for 56 insurers relating to communications, investigations, 57 estimates, and recordkeeping; defining the terms 58 factors beyond the control of the insurer and 59 insurer; specifying required notices by insurers; 60 specifying requirements and procedures for insurers in 61 paying or denying claims; providing construction and 62 applicability; amending s. 626.989, F.S.; revising a 63 reporting requirement for the departments Division of 64 Investigative and Forensic Services; requiring the 65 division to submit an annual performance report to the 66 Legislature; specifying requirements for the report; 67 amending s. 627.0629, F.S.; specifying requirements 68 for residential property insurers in providing certain 69 hurricane mitigation discount information to 70 policyholders in a specified manner; specifying 71 requirements for the office in reevaluating and 72 updating certain fixtures and construction techniques; 73 deleting obsolete dates; amending s. 627.351, F.S.; 74 prohibiting Citizens Property Insurance Corporation 75 from determining that a risk is ineligible for 76 coverage solely on a specified basis; amending s. 77 627.410, F.S.; prohibiting the office from exempting 78 specified insurers from form filing requirements; 79 creating s. 627.4108, F.S.; providing legislative 80 intent; specifying requirements for insurers in 81 submitting claims-handling manuals to the office; 82 authorizing the office to conduct examinations; 83 authorizing the commission to adopt emergency rules; 84 amending s. 627.4133, F.S.; revising prohibitions on 85 insurers against the cancellation or nonrenewal of 86 property insurance policies; revising applicability; 87 providing construction; defining the term insurer; 88 amending s. 627.426, F.S.; requiring the office to 89 ensure that each liability insurer, upon receiving 90 certain notice, takes specified actions; providing 91 construction; amending s. 627.701, F.S.; providing 92 that if a roof deductible is applied under a personal 93 lines residential property insurance policy, no other 94 deductible under the policy may be applied to any 95 other loss to the property caused by the same covered 96 peril; amending s. 627.70132, F.S.; providing for the 97 tolling of certain timeframes for filing notices of 98 property insurance claims for servicemembers; amending 99 s. 627.7019, F.S.; providing that surplus lines 100 insurers are subject to the commissions rulemaking 101 authority as to requirements of insurers after natural 102 disasters; amending s. 627.782, F.S.; revising rate 103 filing requirements for title insurers; providing that 104 the office, rather than the commission, must review 105 premium rates; providing construction relating to 106 chapter 2022-271, Laws of Florida; requiring 107 residential property insurers and motor vehicle 108 insurer rate filings to reflect certain savings and 109 reductions in expenses; specifying requirements for 110 the office in reviewing rate filings; authorizing the 111 office to develop certain factors and contract with a 112 vendor for a certain purpose; providing 113 appropriations; providing an effective date. 114 115 Be It Enacted by the Legislature of the State of Florida: 116 117 Section 1.Paragraph (b) of subsection (10) of section 118 624.307, Florida Statutes, is amended to read: 119 624.307General powers; duties. 120 (10) 121 (b)Any person licensed or issued a certificate of 122 authority by the department or the office shall respond, in 123 writing or electronically, to the division within 14 20 days 124 after receipt of a written request for documents and information 125 from the division concerning a consumer complaint. The response 126 must address the issues and allegations raised in the complaint 127 and include any requested documents concerning the consumer 128 complaint not subject to attorney-client or work-product 129 privilege. The division may impose an administrative penalty for 130 failure to comply with this paragraph of up to $5,000 $2,500 per 131 violation upon any entity licensed by the department or the 132 office and $250 for the first violation, $500 for the second 133 violation, and up to $1,000 per for the third or subsequent 134 violation by upon any individual licensed by the department or 135 the office. 136 Section 2.Present subsection (4) of section 624.315, 137 Florida Statutes, is redesignated as subsection (5), and a new 138 subsection (4) is added to that section, to read: 139 624.315Annual report. 140 (4)The internal auditor of the office shall detail all 141 actions of the office to enforce insurer compliance during the 142 previous year. For each of the following, the report must detail 143 the insurer or other licensee or registrant against whom such 144 action was taken; whether the office found any violation of law 145 or rule by such party, and, if so, detail such violation; and 146 the resolution of such action, including any penalties imposed 147 by the office. The report must be published on the website of 148 the office and submitted to the Governor, the President of the 149 Senate, and the Speaker of the House of Representatives on or 150 before February 15 of each year. The report must include, but 151 need not be limited to: 152 (a)The revocation, denial, or suspension of any license or 153 registration issued by the office. 154 (b)All actions taken pursuant to s. 624.310. 155 (c)Fines imposed by the office for violations of this 156 code. 157 (d)Consent orders entered into by the office. 158 (e)Examinations and investigations conducted and completed 159 by the office pursuant to ss. 624.316 and 624.3161. 160 (f)Investigations conducted and completed, by line of 161 insurance, for which the office found violations of law or rule 162 but did not take enforcement action. 163 Section 3.Section 624.3152, Florida Statutes, is created 164 to read: 165 624.3152Quarterly report of enforcement activity.Each 166 quarter, the office shall create a report detailing all actions 167 of the office to enforce insurer compliance. The report must be 168 submitted to the commission, the President of the Senate, the 169 Speaker of the House of Representatives, and the legislative 170 committees with jurisdiction over matters of insurance. For each 171 of the following, the report must detail the insurer or other 172 licensee or registrant against whom such action was taken; 173 whether the office found any violation of law or rule by such 174 party, and, if so, detail such violation; and the resolution of 175 such action, including any penalties imposed by the office. The 176 report is due on or before April 30, July 31, October 31, and 177 January 31, respectively, for the immediately preceding quarter. 178 The report must include, but need not be limited to: 179 (1)The revocation, denial, or suspension of any license or 180 registration issued by the office. 181 (2)All actions taken pursuant to s. 624.310. 182 (3)Fines imposed by the office for violations of this 183 code. 184 (4)Consent orders entered into by the office. 185 (5)Examinations and investigations conducted and completed 186 by the office pursuant to ss. 624.316 and 624.3161. 187 (6)Investigations conducted and completed, by line of 188 insurance, for which the office found violations of law or rule 189 but did not take enforcement action. 190 Section 4.Subsection (3) is added to section 624.316, 191 Florida Statutes, to read: 192 624.316Examination of insurers. 193 (3)The office shall create a risk-based selection 194 methodology for scheduling examinations of insurers subject to 195 this section. This requirement does not restrict the authority 196 of the office to conduct market conduct examinations as often as 197 it deems advisable. Such methodology must include: 198 (a)Use of currently required risk-based capital reports to 199 prioritize financial examinations of insurers when such 200 reporting indicates a decline in the insurers financial 201 condition. 202 (b)Consideration of any downgrade or threatened downgrade 203 in the insurers financial strength rating. 204 (c)Prioritization of property insurers for which the 205 office identifies significant concerns about an insurers 206 solvency pursuant to s. 627.7154. 207 (d)Any other conditions the office deems necessary for the 208 protection of the public. 209 Section 5.Subsection (7) of section 624.3161, Florida 210 Statutes, is amended, and subsection (8) is added to that 211 section, to read: 212 624.3161Market conduct examinations. 213 (7)Notwithstanding subsection (1), any authorized insurer 214 transacting property insurance business in this state must may 215 be subject to an additional market conduct examination after a 216 hurricane if, at any time more than 90 days after the end of the 217 hurricane, the insurer: 218 (a)Is among the top 20 percent of insurers based upon a 219 calculation of the ratio of hurricane-related property insurance 220 claims filed to the number of property insurance policies in 221 force; 222 (b)Is among the top 20 percent of insurers based upon a 223 calculation of the ratio of consumer complaints made to the 224 department to hurricane-related claims; 225 (c)Has made significant payments to its managing general 226 agent since the hurricane; or 227 (d)Is identified by the office as necessitating a market 228 conduct exam for any other reason. 229 230 All relevant criteria under this section and s. 624.316 shall be 231 applied to the market conduct examination under this subsection. 232 Such an examination must be initiated within 18 months after the 233 landfall of a hurricane that results in an executive order or a 234 state of emergency issued by the Governor. This requirement does 235 not limit in any way the authority of the office to conduct at 236 any time a market conduct examination of a property insurer in 237 the aftermath of a hurricane. An examination of an insurer under 238 this subsection must also include an examination of its managing 239 general agent as if it were the insurer. 240 (8)The office shall create, and the commission shall adopt 241 by rule, a risk-based selection methodology for scheduling and 242 conducting market conduct examinations of insurers and other 243 entities regulated by the office. This requirement does not 244 restrict the authority of the office to conduct market conduct 245 examinations as often as it deems necessary. Under such 246 selection methodology, the office must initiate a market conduct 247 examination if any of the following conditions exist relating to 248 an insurer or other entity regulated by the office: 249 (a)An insurance regulator in another state has initiated 250 or taken regulatory action against the insurer or entity, 251 including, but not limited to: 252 1.A licensure denial, suspension, or revocation; 253 2.Imposition of administrative fines; or 254 3.Issuance of a cease and desist order, consent order, or 255 other order regarding actions or omissions of the insurer or 256 entity. 257 (b)Given the insurers market share in this state, the 258 department or the office has received a disproportionate number 259 of the following types of claims-handling complaints against the 260 insurer: 261 1.Failure to timely communicate with respect to claims; 262 2.Failure to timely pay claims; 263 3.Untimely payments giving rise to the payment of 264 statutory interest; 265 4.Failure to adjust and pay claims in accordance with the 266 terms and conditions of the policy or contract and in compliance 267 with state law; 268 5.Violations of the Unfair Insurance Trade Practices Act 269 in part IX of chapter 626; 270 6.Failure to use licensed and duly appointed claims 271 adjusters; 272 7.Failure to maintain reasonable claims records; or 273 8.Failure to adhere to the companys claims-handling 274 manual. 275 (c)The results of a National Association of Insurance 276 Commissioners Market Conduct Annual Statement indicate the 277 insurer is a negative outlier with regard to particular metrics. 278 (d)There is evidence the insurer is engaged in a pattern 279 or practice of violations of the Unfair Insurance Trade 280 Practices Act. 281 (e)The insurer meets the criteria in subsection (7). 282 (f)Any other conditions the office deems necessary for the 283 protection of the public. 284 Section 6.Section 624.4211, Florida Statutes, is amended 285 to read: 286 624.4211Administrative fine in lieu of suspension or 287 revocation. 288 (1)If the office finds that one or more grounds exist for 289 the discretionary revocation or suspension of a certificate of 290 authority issued under this chapter, the office may, in lieu of 291 such revocation or suspension, impose a fine upon the insurer. 292 (2)(a)With respect to a any nonwillful violation, such 293 fine may not exceed: 294 1.Twenty-five thousand dollars per violation, up to an 295 aggregate amount of $100,000 for all nonwillful violations 296 arising out of the same action, related to a covered loss or 297 claim caused by an emergency for which the Governor declared a 298 state of emergency pursuant to s. 252.36. 299 2.Twelve thousand five hundred dollars $5,000 per 300 violation, up to. In no event shall such fine exceed an 301 aggregate amount of $50,000 $20,000 for all other nonwillful 302 violations arising out of the same action. 303 (b)If an insurer discovers a nonwillful violation, the 304 insurer shall correct the violation and, if restitution is due, 305 make restitution to all affected persons. Such restitution shall 306 include interest at 12 percent per year from either the date of 307 the violation or the date of inception of the affected persons 308 policy, at the insurers option. The restitution may be a credit 309 against future premiums due provided that interest accumulates 310 until the premiums are due. If the amount of restitution due to 311 any person is $50 or more and the insurer wishes to credit it 312 against future premiums, it shall notify such person that she or 313 he may receive a check instead of a credit. If the credit is on 314 a policy that is not renewed, the insurer shall pay the 315 restitution to the person to whom it is due. 316 (3)(a)With respect to a any knowing and willful violation 317 of a lawful order or rule of the office or commission or a 318 provision of this code, the office may impose a fine upon the 319 insurer in an amount not to exceed: 320 1.Two hundred thousand dollars for each such violation, up 321 to an aggregate amount of $1 million for all knowing and willful 322 violations arising out of the same action, related to a covered 323 loss or claim caused by an emergency for which the Governor 324 declared a state of emergency pursuant to s. 252.36. 325 2.One hundred thousand dollars $40,000 for each such 326 violation, up to. In no event shall such fine exceed an 327 aggregate amount of $500,000 $200,000 for all other knowing and 328 willful violations arising out of the same action. 329 (b)In addition to such fines, the insurer shall make 330 restitution when due in accordance with subsection (2). 331 (4)The failure of an insurer to make restitution when due 332 as required under this section constitutes a willful violation 333 of this code. However, if an insurer in good faith is uncertain 334 as to whether any restitution is due or as to the amount of such 335 restitution, it shall promptly notify the office of the 336 circumstances; and the failure to make restitution pending a 337 determination thereof shall not constitute a violation of this 338 code. 339 Section 7.Subsection (13) of section 624.424, Florida 340 Statutes, is amended to read: 341 624.424Annual statement and other information. 342 (13)(a)Each insurer doing business in this state which 343 pays a fee, commission, or other financial consideration or 344 payment to any affiliate directly or indirectly must is required 345 upon request to provide to the office documentation supporting 346 that such any information the office deems necessary. The fee, 347 commission, or other financial consideration or payment to any 348 affiliate is must be fair and reasonable for each service being 349 provided by contract. In determining whether the fee, 350 commission, or other financial consideration or payment is fair 351 and reasonable, the office shall consider, at a minimum, the 352 following: 353 1.The actual cost of each service provided by an 354 affiliate; 355 2.The cost of that service, if provided by a nonaffiliate; 356 3.The relative financial condition of the insurer and of 357 the managing general agent; 358 4.The level of holding company debt and how that debt is 359 serviced; 360 5.The amount of dividends paid by the managing general 361 agent and for what purpose; and 362 6.Whether the terms of the written contract benefit the 363 insurer and are in the best interest of policyholders. 364 (b)For each agreement with an affiliate in force on July 365 1, 2023, each insurer shall provide to the office no later than 366 October 1, 2023, the cost incurred by the affiliate to provide 367 each service, the amount charged to the insurer for each 368 service, and the dollar amount of fees forgiven, waived, or 369 reimbursed by the affiliate for the two most recent preceding 370 years. If the total dollar amount charged to the insurer was 371 greater than the total cost to provide services for either year, 372 the insurer must explain how it determined the fee was fair and 373 reasonable. For any proposed contract with an affiliate 374 effective after July 1, 2023, the insurer may include a proposal 375 for the same services by an unaffiliated third party to support 376 that the fee, commission, or other financial consideration or 377 payment to the affiliate is fair and reasonable among other 378 things, the actual cost of the service being provided. 379 Section 8.Section 624.4301, Florida Statutes, is created 380 to read: 381 624.4301Notice of temporary discontinuance of writing new 382 policies.Any insurer, before temporarily suspending writing new 383 policies in this state, must give written notice to the office 384 of the insurers reasons for such action, the effective dates of 385 the temporary suspension, and the proposed communication to its 386 agents. The insurer shall submit such notice to the office the 387 earlier of 20 business days before the effective date of the 388 temporary suspension of writing or 5 business days before 389 notifying its agents of the temporary suspension of writing. The 390 insurer must provide any other information requested by the 391 office related to the insurers temporary suspension of writing. 392 Section 9.Paragraph (c) of subsection (3) of section 393 626.207, Florida Statutes, is amended to read: 394 626.207Disqualification of applicants and licensees; 395 penalties against licensees; rulemaking authority. 396 (3)An applicant who has been found guilty of or has 397 pleaded guilty or nolo contendere to a crime not included in 398 subsection (2), regardless of adjudication, is subject to: 399 (c)A 7-year disqualifying period for all misdemeanors 400 directly related to the financial services business or any 401 violation of the Florida Insurance Code. 402 Section 10.Subsections (2) and (3) of section 626.9521, 403 Florida Statutes, are amended to read: 404 626.9521Unfair methods of competition and unfair or 405 deceptive acts or practices prohibited; penalties. 406 (2)Except as provided in subsection (3), any person who 407 violates any provision of this part is subject to a fine in an 408 amount not greater than $12,500 $5,000 for each nonwillful 409 violation and not greater than $100,000 $40,000 for each willful 410 violation. Fines under this subsection imposed against an 411 insurer may not exceed an aggregate amount of $50,000 $20,000 412 for all nonwillful violations arising out of the same action or 413 an aggregate amount of $500,000 $200,000 for all willful 414 violations arising out of the same action. The fines may be 415 imposed in addition to any other applicable penalty. 416 (3)(a)If a person violates s. 626.9541(1)(l), the offense 417 known as twisting, or violates s. 626.9541(1)(aa), the offense 418 known as churning, the person commits a misdemeanor of the 419 first degree, punishable as provided in s. 775.082, and an 420 administrative fine not greater than $12,500 $5,000 shall be 421 imposed for each nonwillful violation or an administrative fine 422 not greater than $187,500 $75,000 shall be imposed for each 423 willful violation. To impose an administrative fine for a 424 willful violation under this paragraph, the practice of 425 churning or twisting must involve fraudulent conduct. 426 (b)If a person violates s. 626.9541(1)(ee) by willfully 427 submitting fraudulent signatures on an application or policy 428 related document, the person commits a felony of the third 429 degree, punishable as provided in s. 775.082, and an 430 administrative fine not greater than $12,500 $5,000 shall be 431 imposed for each nonwillful violation or an administrative fine 432 not greater than $187,500 $75,000 shall be imposed for each 433 willful violation. 434 (c)If a person violates any provision of this part and 435 such violation is related to a covered loss or covered claim 436 caused by an emergency for which the Governor declared a state 437 of emergency pursuant to s. 252.36, such person is subject to a 438 fine in an amount not greater than $25,000 for each nonwillful 439 violation and not greater than $200,000 for each willful 440 violation. Fines under this paragraph imposed against an insurer 441 may not exceed an aggregate amount of $100,000 for all 442 nonwillful violations arising out of the same action or an 443 aggregate amount of $1 million for all willful violations 444 arising out of the same action. 445 (d)Administrative fines under paragraphs (a) and (b) this 446 subsection may not exceed an aggregate amount of $125,000 447 $50,000 for all nonwillful violations arising out of the same 448 action or an aggregate amount of $625,000 $250,000 for all 449 willful violations arising out of the same action. 450 Section 11.Paragraphs (i) and (w) of subsection (1) of 451 section 626.9541, Florida Statutes, are amended to read: 452 626.9541Unfair methods of competition and unfair or 453 deceptive acts or practices defined. 454 (1)UNFAIR METHODS OF COMPETITION AND UNFAIR OR DECEPTIVE 455 ACTS.The following are defined as unfair methods of competition 456 and unfair or deceptive acts or practices: 457 (i)Unfair claim settlement practices. 458 1.Attempting to settle claims on the basis of an 459 application, when serving as a binder or intended to become a 460 part of the policy, or any other material document which was 461 altered without notice to, or knowledge or consent of, the 462 insured; 463 2.A material misrepresentation made to an insured or any 464 other person having an interest in the proceeds payable under 465 such contract or policy, for the purpose and with the intent of 466 effecting settlement of such claims, loss, or damage under such 467 contract or policy on less favorable terms than those provided 468 in, and contemplated by, such contract or policy; 469 3.Committing or performing with such frequency as to 470 indicate a general business practice any of the following: 471 a.Failing to adopt and implement standards for the proper 472 investigation of claims; 473 b.Misrepresenting pertinent facts or insurance policy 474 provisions relating to coverages at issue; 475 c.Failing to acknowledge and act promptly upon 476 communications with respect to claims; 477 d.Denying claims without conducting reasonable 478 investigations based upon available information; 479 e.Failing to affirm or deny full or partial coverage of 480 claims, and, as to partial coverage, the dollar amount or extent 481 of coverage, or failing to provide a written statement that the 482 claim is being investigated, upon the written request of the 483 insured within 30 days after proof-of-loss statements have been 484 completed; 485 f.Failing to promptly provide a reasonable explanation in 486 writing to the insured of the basis in the insurance policy, in 487 relation to the facts or applicable law, for denial of a claim 488 or for the offer of a compromise settlement; 489 g.Failing to promptly notify the insured of any additional 490 information necessary for the processing of a claim; 491 h.Failing to clearly explain the nature of the requested 492 information and the reasons why such information is necessary; 493 or 494 i.Failing to pay personal injury protection insurance 495 claims within the time periods required by s. 627.736(4)(b). The 496 office may order the insurer to pay restitution to a 497 policyholder, medical provider, or other claimant, including 498 interest at a rate consistent with the amount set forth in s. 499 55.03(1), for the time period within which an insurer fails to 500 pay claims as required by law. Restitution is in addition to any 501 other penalties allowed by law, including, but not limited to, 502 the suspension of the insurers certificate of authority; or 503 j.Altering or amending an insurance adjusters report 504 without including on the report or as an addendum to the report 505 a detailed list of all changes made to the report and the 506 identity of the person who ordered each change. Any change that 507 has the effect of reducing the estimate of the loss must include 508 a detailed explanation why such change was made; or 509 4.Failing to pay undisputed amounts of partial or full 510 benefits owed under first-party property insurance policies 511 within 60 days after an insurer receives notice of a residential 512 property insurance claim, determines the amounts of partial or 513 full benefits, and agrees to coverage, unless payment of the 514 undisputed benefits is prevented by factors beyond the control 515 of the insurer as defined in s. 627.70131(5). 516 (w)Soliciting or accepting new or renewal insurance risks 517 or payment of certain bonuses by insolvent or impaired insurer 518 prohibited; penalty. 519 1.Whether or not delinquency proceedings as to the insurer 520 have been or are to be initiated, but while such insolvency or 521 impairment exists, no director or officer of an insurer, except 522 with the written permission of the office, shall authorize or 523 permit the insurer to solicit or accept new or renewal insurance 524 risks in this state after such director or officer knew, or 525 reasonably should have known, that the insurer was insolvent or 526 impaired. 527 2.Regardless of whether delinquency proceedings as to the 528 insurer have been or are to be initiated, but while such 529 insolvency or impairment exists, a director or an officer of an 530 impaired insurer may not authorize or permit the insurer to pay 531 a bonus to any officer or director of the insurer. 532 3.As used in this paragraph, the term: 533 a.Bonus means a payment, in addition to an officers or 534 a directors usual compensation, that is in addition to any 535 amounts contracted for or otherwise legally due. 536 b.Impaired includes impairment of capital or surplus, as 537 defined in s. 631.011(12) and (13). 538 4.2.Any such director or officer, upon conviction of a 539 violation of this paragraph, commits is guilty of a felony of 540 the third degree, punishable as provided in s. 775.082, s. 541 775.083, or s. 775.084. 542 Section 12.Section 626.9743, Florida Statutes, is amended 543 to read: 544 626.9743Claim settlement practices relating to motor 545 vehicle insurance. 546 (1)This section shall apply to the adjustment and 547 settlement of first- and third-party personal and commercial 548 motor vehicle insurance claims. 549 (2)(a)Upon an insurers receiving a communication with 550 respect to a claim, the insurer shall within 7 calendar days 551 review and acknowledge receipt of such communication unless 552 payment is made within that period of time or unless the failure 553 to acknowledge is caused by factors beyond the control of the 554 insurer. If the acknowledgment is not in writing, a notification 555 indicating acknowledgement must be made in the insurers claim 556 file and dated. A communication made to or by a representative 557 of an insurer with respect to a claim constitutes communication 558 to or by the insurer. 559 (b)Such acknowledgment must be responsive to the 560 communication. If the communication constitutes notification of 561 a claim, unless the acknowledgment reasonably advises the 562 claimant that the claim appears not to be covered by the 563 insurer, the acknowledgment must provide necessary claim forms 564 and instructions, including an appropriate telephone number. 565 (3)(a)Unless otherwise provided by the policy of insurance 566 or by law, within 7 days after an insurer receives proof-of-loss 567 statements, the insurer shall begin such investigation as is 568 reasonably necessary unless the failure to begin such 569 investigation is caused by factors beyond the control of the 570 insurer. 571 (b)If such investigation involves a physical inspection of 572 the motor vehicle, the licensed adjuster assigned by the insurer 573 must provide the policyholder with a printed or electronic 574 document containing his or her name and state adjuster license 575 number. An insurer must conduct any such physical inspection 576 within 7 days after its receipt of the proof-of-loss statements. 577 (c)Any subsequent communication with the policyholder 578 regarding the claim must also include the name and license 579 number of the adjuster communicating about the claim. 580 Communication of the adjusters name and license number may be 581 included with other information provided to the policyholder. 582 (d)An insurer may use electronic methods to investigate 583 the loss. Such electronic methods may include any method that 584 provides the insurer with clear color pictures or video 585 documenting the loss, including, but not limited to, electronic 586 photographs or video recordings of the loss and video 587 conferencing between the adjuster and the policyholder which 588 includes video recording of the loss. The insurer may also allow 589 the policyholder to use such methods to assist in the 590 investigation of the loss. An insurer may void the insurance 591 policy if the policyholder or any other person at the direction 592 of the policyholder, with intent to injure, defraud, or deceive 593 any insurer, commits insurance fraud by providing false, 594 incomplete, or misleading information concerning any fact or 595 thing material to a claim using electronic methods. The use of 596 electronic methods to investigate the loss does not prohibit an 597 insurer from assigning a licensed adjuster to physically inspect 598 the motor vehicle. 599 (e)The insurer must send the policyholder a copy of any 600 detailed estimate of the amount of the loss within 7 days after 601 the estimate is generated by the insurers adjuster. This 602 paragraph does not require that an insurer create a detailed 603 estimate of the amount of the loss if such estimate is not 604 reasonably necessary as part of the claim investigation. 605 (4)An insurer shall maintain: 606 (a)A record or log of each adjuster who communicates with 607 the policyholder as provided in paragraphs (3)(b) and (c) and 608 provide a list of such adjusters to the insured, the office, or 609 the department upon request. 610 (b)Claim records, including dates of: 611 1.Any claim-related communication made between the insurer 612 and the policyholder or the policyholders representative; 613 2.The insurers receipt of the policyholders proof of 614 loss statement; 615 3.Any claim-related request for information made by the 616 insurer to the policyholder or the policyholders 617 representative; 618 4.Any claim-related inspections of the property made by 619 the insurer, including physical inspections and inspections made 620 by electronic means; 621 5.Any detailed estimate of the amount of the loss 622 generated by the insurers adjuster; 623 6.The beginning and end of any tolling period provided for 624 in subsection (8); and 625 7.The insurers payment or denial of the claim. 626 (5)For purposes of this section, the term: 627 (a)Factors beyond the control of the insurer means: 628 1.Any of the following events which is the basis for the 629 office issuing an order finding that such event renders all or 630 specified residential property insurers reasonably unable to 631 meet the requirements of this section in specified locations, 632 and ordering that such insurer or insurers may have additional 633 time as specified by the office to comply with the requirements 634 of this section: a state of emergency declared by the Governor 635 under s. 252.36, a breach of security that must be reported 636 under s. 501.171(3), or an information technology issue. The 637 office may not extend the period for payment or denial of a 638 claim for more than 30 additional days. 639 2.Actions by the policyholder or the policyholders 640 representative which constitute fraud, lack of cooperation, or 641 intentional misrepresentation regarding the claim for which 642 benefits are owed when such actions reasonably prevent the 643 insurer from complying with any requirement of this section. 644 (b)Insurer means any motor vehicle insurer. 645 (6)(a)When providing a preliminary or partial estimate of 646 damage regarding a claim, an insurer shall include with the 647 estimate the following statement printed in at least 12-point 648 bold, uppercase type: THIS ESTIMATE REPRESENTS OUR CURRENT 649 EVALUATION OF THE COVERED DAMAGES TO YOUR INSURED PROPERTY AND 650 MAY BE REVISED AS WE CONTINUE TO EVALUATE YOUR CLAIM. IF YOU 651 HAVE QUESTIONS, CONCERNS, OR ADDITIONAL INFORMATION REGARDING 652 YOUR CLAIM, WE ENCOURAGE YOU TO CONTACT US. 653 (b)When providing a payment on a claim which is not the 654 full and final payment for the claim, an insurer shall include 655 with the payment the following statement printed in at least 12 656 point bold, uppercase type: WE ARE CONTINUING TO EVALUATE YOUR 657 CLAIM INVOLVING YOUR INSURED PROPERTY AND MAY ISSUE ADDITIONAL 658 PAYMENTS. IF YOU HAVE QUESTIONS, CONCERNS, OR ADDITIONAL 659 INFORMATION REGARDING YOUR CLAIM, WE ENCOURAGE YOU TO CONTACT 660 US. 661 (7)Within 60 days after an insurer receives notice of an 662 initial or supplemental motor vehicle claim from a first- or 663 third-party claimant, the insurer shall pay or deny such claim 664 or a portion of the claim unless the failure to pay is caused by 665 factors beyond the control of the insurer. The insurer shall 666 provide a reasonable explanation in writing to the policyholder 667 of the basis in the insurance policy, in relation to the facts 668 or applicable law, for the payment, denial, or partial denial of 669 a claim. If the insurers claim payment is less than specified 670 in any insurers detailed estimate of the amount of the loss, 671 the insurer must provide a reasonable explanation in writing of 672 the difference to the policyholder. Any payment of an initial or 673 supplemental claim or portion of such claim made 60 days after 674 the insurer receives notice of the claim, or made after the 675 expiration of any additional timeframe provided to pay or deny a 676 claim or a portion of a claim made pursuant to an order of the 677 office finding factors beyond the control of the insurer, 678 whichever is later, bears interest at the rate set forth in s. 679 55.03. Interest begins to accrue from the date the insurer 680 receives notice of the claim. This subsection may not be waived, 681 voided, or nullified by the terms of the insurance policy. If 682 there is a right to prejudgment interest, the insured must 683 select whether to receive prejudgment interest or interest under 684 this subsection. Interest is payable when the claim or portion 685 of the claim is paid. Failure to comply with this subsection 686 constitutes a violation of this code. However, failure to comply 687 with this subsection does not form the sole basis for a private 688 cause of action. 689 (8)The requirements of this section are tolled: 690 (a)During the pendency of any mediation proceeding under 691 s. 627.745 or any alternative dispute resolution proceeding 692 provided for in the insurance contract. The tolling period ends 693 upon the end of the mediation or alternative dispute resolution 694 proceeding. 695 (b)Upon the failure of a policyholder or a representative 696 of the policyholder to provide material claims information 697 requested by the insurer within 10 days after the request was 698 received. The tolling period ends upon the insurers receipt of 699 the requested information. Tolling under this paragraph applies 700 only to requests sent by the insurer to the policyholder or a 701 representative of the policyholder at least 15 days before the 702 insurer is required to pay or deny the claim or a portion of the 703 claim under subsection (7). 704 (9)This section also applies to surplus lines insurers and 705 surplus lines insurance authorized under ss. 626.913-626.937 706 providing motor vehicle coverage. 707 (10)(2)An insurer may not, when liability and damages owed 708 under the policy are reasonably clear, recommend that a third 709 party claimant make a claim under his or her own policy solely 710 to avoid paying the claim under the policy issued by that 711 insurer. However, the insurer may identify options to a third 712 party claimant relative to the repair of his or her vehicle. 713 (11)(3)An insurer that elects to repair a motor vehicle 714 and specifically requires a particular repair shop for vehicle 715 repairs shall cause the damaged vehicle to be restored to its 716 physical condition as to performance and appearance immediately 717 prior to the loss at no additional cost to the insured or third 718 party claimant other than as stated in the policy. 719 (12)(4)An insurer may not require the use of replacement 720 parts in the repair of a motor vehicle which are not at least 721 equivalent in kind and quality to the damaged parts prior to the 722 loss in terms of fit, appearance, and performance. 723 (13)(5)When the insurance policy provides for the 724 adjustment and settlement of first-party motor vehicle total 725 losses on the basis of actual cash value or replacement with 726 another of like kind and quality, the insurer shall use one of 727 the following methods: 728 (a)The insurer may elect a cash settlement based upon the 729 actual cost to purchase a comparable motor vehicle, including 730 sales tax, if applicable pursuant to subsection (17) (9). Such 731 cost may be derived from: 732 1.When comparable motor vehicles are available in the 733 local market area, the cost of two or more such comparable motor 734 vehicles available within the preceding 90 days; 735 2.The retail cost as determined from a generally 736 recognized used motor vehicle industry source such as: 737 a.An electronic database if the pertinent portions of the 738 valuation documents generated by the database are provided by 739 the insurer to the first-party insured upon request; or 740 b.A guidebook that is generally available to the general 741 public if the insurer identifies the guidebook used as the basis 742 for the retail cost to the first-party insured upon request; or 743 3.The retail cost using two or more quotations obtained by 744 the insurer from two or more licensed dealers in the local 745 market area. 746 (b)The insurer may elect to offer a replacement motor 747 vehicle that is a specified comparable motor vehicle available 748 to the insured, including sales tax if applicable pursuant to 749 subsection (17) (9), paid for by the insurer at no cost other 750 than any deductible provided in the policy and betterment as 751 provided in subsection (14) (6). The offer must be documented in 752 the insurers claim file. For purposes of this subsection, a 753 comparable motor vehicle is one that is made by the same 754 manufacturer, of the same or newer model year, and of similar 755 body type and that has similar options and mileage as the 756 insured vehicle. Additionally, a comparable motor vehicle must 757 be in as good or better overall condition than the insured 758 vehicle and available for inspection within a reasonable 759 distance of the insureds residence. 760 (c)When a motor vehicle total loss is adjusted or settled 761 on a basis that varies from the methods described in paragraph 762 (a) or paragraph (b), the determination of value must be 763 supported by documentation, and any deductions from value must 764 be itemized and specified in appropriate dollar amounts. The 765 basis for such settlement shall be explained to the claimant in 766 writing, if requested, and a copy of the explanation shall be 767 retained in the insurers claim file. 768 (d)Any other method agreed to by the claimant. 769 (14)(6)When the amount offered in settlement reflects a 770 reduction by the insurer because of betterment or depreciation, 771 information pertaining to the reduction shall be maintained with 772 the insurers claim file. Deductions shall be itemized and 773 specific as to dollar amount and shall accurately reflect the 774 value assigned to the betterment or depreciation. The basis for 775 any deduction shall be explained to the claimant in writing, if 776 requested, and a copy of the explanation shall be maintained 777 with the insurers claim file. 778 (15)(7)Every insurer shall, if partial losses are settled 779 on the basis of a written estimate prepared by or for the 780 insurer, supply the insured a copy of the estimate upon which 781 the settlement is based. 782 (16)(8)Every insurer shall provide notice to an insured 783 before termination of payment for previously authorized storage 784 charges, and the notice shall provide 72 hours for the insured 785 to remove the vehicle from storage before terminating payment of 786 the storage charges. 787 (17)(9)If sales tax will necessarily be incurred by a 788 claimant upon replacement of a total loss or upon repair of a 789 partial loss, the insurer may defer payment of the sales tax 790 unless and until the obligation has actually been incurred. 791 (18)(10)Nothing in this section shall be construed to 792 authorize or preclude enforcement of policy provisions relating 793 to settlement disputes. 794 Section 13.Subsection (6) of section 626.989, Florida 795 Statutes, is amended, and subsection (10) is added to that 796 section, to read: 797 626.989Investigation by department or Division of 798 Investigative and Forensic Services; compliance; immunity; 799 confidential information; reports to division; division 800 investigators power of arrest. 801 (6)(a)Any person, other than an insurer, agent, or other 802 person licensed under the code, or an employee thereof, having 803 knowledge or who believes that a fraudulent insurance act or any 804 other act or practice which, upon conviction, constitutes a 805 felony or a misdemeanor under the code, or under s. 817.234, is 806 being or has been committed may send to the Division of 807 Investigative and Forensic Services a report or information 808 pertinent to such knowledge or belief and such additional 809 information relative thereto as the department may request. Any 810 professional practitioner licensed or regulated by the 811 Department of Business and Professional Regulation, except as 812 otherwise provided by law, any medical review committee as 813 defined in s. 766.101, any private medical review committee, and 814 any insurer, agent, or other person licensed under the code, or 815 an employee thereof, having knowledge or who believes that a 816 fraudulent insurance act or any other act or practice which, 817 upon conviction, constitutes a felony or a misdemeanor under the 818 code, or under s. 817.234, is being or has been committed shall 819 send to the Division of Investigative and Forensic Services a 820 report or information pertinent to such knowledge or belief and 821 such additional information relative thereto as the department 822 may require. 823 (b)The Division of Investigative and Forensic Services 824 shall review such information or reports and select such 825 information or reports as, in its judgment, may require further 826 investigation. It shall then cause an independent examination of 827 the facts surrounding such information or report to be made to 828 determine the extent, if any, to which a fraudulent insurance 829 act or any other act or practice which, upon conviction, 830 constitutes a felony or a misdemeanor under the code, or under 831 s. 817.234, is being committed. 832 (c)The Division of Investigative and Forensic Services 833 shall report any alleged violations of law which its 834 investigations disclose to the appropriate licensing agency and 835 state attorney or other prosecuting agency having jurisdiction, 836 including, but not limited to, the statewide prosecutor for 837 crimes that impact two or more judicial circuits in this state, 838 with respect to any such violation, as provided in s. 624.310. 839 If prosecution by the state attorney or other prosecuting agency 840 having jurisdiction with respect to such violation is not begun 841 within 60 days of the divisions report, the state attorney or 842 other prosecuting agency having jurisdiction with respect to 843 such violation shall inform the division of the reasons for the 844 lack of prosecution. 845 (10)The Division of Investigative and Forensic Services 846 Bureau of Insurance Fraud shall prepare and submit a performance 847 report to the President of the Senate and the Speaker of the 848 House of Representatives by January 1 of each year. The annual 849 report must include, but need not be limited to: 850 (a)The total number of initial referrals received, cases 851 opened, cases presented for prosecution, cases closed, and 852 convictions resulting from cases presented for prosecution by 853 the Bureau of Insurance Fraud, by type of insurance fraud and 854 circuit. 855 (b)The number of referrals received from insurers, the 856 office, and the Division of Consumer Services of the department, 857 and the outcome of those referrals. 858 (c)The number of investigations undertaken by the Bureau 859 of Insurance Fraud which were not the result of a referral from 860 an insurer and the outcome of those referrals. 861 (d)The number of investigations that resulted in a 862 referral to a regulatory agency and the disposition of those 863 referrals. 864 (e)The number of cases presented by the Bureau of 865 Insurance Fraud which local prosecutors or the statewide 866 prosecutor declined to prosecute and the reasons provided for 867 declining prosecution. 868 (f)A summary of the annual report required under s. 869 626.9896. 870 (g)The total number of employees assigned to the Bureau of 871 Insurance Fraud, delineated by location of staff assigned; and 872 the number and location of employees assigned to the Bureau of 873 Insurance Fraud who were assigned to work other types of fraud 874 cases. 875 (h)The average caseload and turnaround time by type of 876 case for each investigator. 877 (i)The training provided during the year to insurance 878 fraud investigators. 879 Section 14.Subsections (1), (3), and (4) of section 880 627.0629, Florida Statutes, are amended to read: 881 627.0629Residential property insurance; rate filings. 882 (1)It is the intent of the Legislature that insurers 883 provide savings to consumers who install or implement windstorm 884 damage mitigation techniques, alterations, or solutions to their 885 properties to prevent windstorm losses. A rate filing for 886 residential property insurance must include actuarially 887 reasonable discounts, credits, or other rate differentials, or 888 appropriate reductions in deductibles, for properties on which 889 fixtures or construction techniques demonstrated to reduce the 890 amount of loss in a windstorm have been installed or 891 implemented. The fixtures or construction techniques must 892 include, but are not limited to, fixtures or construction 893 techniques that enhance roof strength, roof covering 894 performance, roof-to-wall strength, wall-to-floor-to-foundation 895 strength, opening protection, and window, door, and skylight 896 strength. Credits, discounts, or other rate differentials, or 897 appropriate reductions in deductibles, for fixtures and 898 construction techniques that meet the minimum requirements of 899 the Florida Building Code must be included in the rate filing. 900 The office shall determine the discounts, credits, other rate 901 differentials, and appropriate reductions in deductibles that 902 reflect the full actuarial value of such revaluation, which may 903 be used by insurers in rate filings. Effective July 1, 2023, 904 each insurer subject to the requirements of this section must 905 provide information on the insurers website describing the 906 hurricane mitigation discounts available to policyholders. Such 907 information must be accessible on, or through a hyperlink 908 located on, the home page of the insurers website or the 909 primary page of the insurers website for property insurance 910 policyholders or applicants for such coverage in this state. On 911 or before January 1, 2025, and every 5 years thereafter, the 912 office shall reevaluate and update the fixtures or construction 913 techniques demonstrated to reduce the amount of loss in a 914 windstorm and the discounts, credits, other rate differentials, 915 and appropriate reductions in deductibles that reflect the full 916 actuarial value of such fixtures or construction techniques. The 917 office shall adopt rules and forms necessitated by such 918 reevaluation. 919 (3)A rate filing made on or after July 1, 1995, for mobile 920 home owner insurance must include appropriate discounts, 921 credits, or other rate differentials for mobile homes 922 constructed to comply with American Society of Civil Engineers 923 Standard ANSI/ASCE 7-88, adopted by the United States Department 924 of Housing and Urban Development on July 13, 1994, and that also 925 comply with all applicable tie-down requirements provided by 926 state law. 927 (4)The Legislature finds that separate consideration and 928 notice of hurricane insurance premiums will assist consumers by 929 providing greater assurance that hurricane premiums are lawful 930 and by providing more complete information regarding the 931 components of property insurance premiums. Effective January 1, 932 1997, A rate filing for residential property insurance shall be 933 separated into two components, rates for hurricane coverage and 934 rates for all other coverages. A premium notice reflecting a 935 rate implemented on the basis of such a filing shall separately 936 indicate the premium for hurricane coverage and the premium for 937 all other coverages. 938 Section 15.Paragraph (ll) is added to subsection (6) of 939 section 627.351, Florida Statutes, to read: 940 627.351Insurance risk apportionment plans. 941 (6)CITIZENS PROPERTY INSURANCE CORPORATION. 942 (ll)The corporation may not determine that a risk is 943 ineligible for coverage with the corporation solely because such 944 risk has unrepaired damage caused by a covered loss that is the 945 subject of a claim that has been filed with the Florida 946 Insurance Guaranty Association. 947 Section 16.Subsection (4) of section 627.410, Florida 948 Statutes, is amended to read: 949 627.410Filing, approval of forms. 950 (4)The office may, by order, exempt from the requirements 951 of this section for so long as it deems proper any insurance 952 document or form or type thereof as specified in such order, to 953 which, in its opinion, this section may not practicably be 954 applied, or the filing and approval of which are, in its 955 opinion, not desirable or necessary for the protection of the 956 public. The office may not exempt from the requirements of this 957 section the insurance documents or forms of any insurer, against 958 whom the office enters a final order determining that such 959 insurer violated any provision of this code, for a period of 36 960 months after the date of such order. 961 Section 17.Section 627.4108, Florida Statutes, is created 962 to read: 963 627.4108Submission of claims-handling manuals; 964 attestation. 965 (1)This section is intended to ensure that insurers are 966 able to properly handle insurance claims, particularly during 967 natural disasters, catastrophes, and other emergencies. 968 (2)Each authorized insurer and eligible surplus lines 969 insurer conducting business in this state shall submit any and 970 all claims-handling manuals to the office: 971 (a)On or before August 1, 2023; 972 (b)Annually thereafter, on or before May 1 of each 973 calendar year; and 974 (c)Within 30 days after any updates or amendments to such 975 manual. 976 (3)The insurer shall include with each such submission an 977 attestation on a form prescribed by the commission, stating 978 that: 979 (a)The insurers claims-handling manual complies with the 980 requirements of this code and comports to usual and customary 981 industry claims-handling practices; and 982 (b)The insurer maintains adequate resources available to 983 implement the requirements of its claims-handling manual at all 984 times, including during extreme catastrophic events. 985 (4)The office may, as often as it deems necessary, conduct 986 market conduct examinations under s. 624.3161 of insurers to 987 ensure compliance with this section. 988 (5)The commission is authorized, and all conditions are 989 deemed met, to adopt emergency rules under s. 120.54(4), for the 990 purpose of implementing this section. Notwithstanding any other 991 law, emergency rules adopted under this section are effective 992 for 6 months after adoption and may be renewed during the 993 pendency of procedures to adopt permanent rules addressing the 994 subject of the emergency rules. 995 Section 18.Paragraph (d) of subsection (2) of section 996 627.4133, Florida Statutes, is amended to read: 997 627.4133Notice of cancellation, nonrenewal, or renewal 998 premium. 999 (2)With respect to any personal lines or commercial 1000 residential property insurance policy, including, but not 1001 limited to, any homeowner, mobile home owner, farmowner, 1002 condominium association, condominium unit owner, apartment 1003 building, or other policy covering a residential structure or 1004 its contents: 1005 (d)1.Upon a declaration of an emergency pursuant to s. 1006 252.36 and the filing of an order by the Commissioner of 1007 Insurance Regulation, An authorized insurer or surplus lines 1008 insurer may not cancel or nonrenew a personal residential or 1009 commercial residential property insurance policy covering a 1010 dwelling or residential property located in this state: 1011 a.For a period of 90 days after the dwelling or 1012 residential property has been repaired, if such property which 1013 has been damaged as a result of a hurricane or wind loss that is 1014 the subject of the declaration of emergency pursuant to s. 1015 252.36 and the filing of an order by the Commissioner of 1016 Insurance Regulation for a period of 90 days after the dwelling 1017 or residential property has been repaired. A structure is deemed 1018 to be repaired when substantially completed and restored to the 1019 extent that it is insurable by another authorized insurer that 1020 is writing policies in this state. 1021 b.Until the dwelling or residential property has been 1022 repaired, if such property was damaged by any covered peril and 1023 the provisions of sub-subparagraph a. do not apply. 1024 2.However, an insurer or agent may cancel or nonrenew such 1025 a policy prior to the repair of the dwelling or residential 1026 property: 1027 a.Upon 10 days notice for nonpayment of premium; or 1028 b.Upon 45 days notice: 1029 (I)For a material misstatement or fraud related to the 1030 claim; 1031 (II)If the insurer determines that the insured has 1032 unreasonably caused a delay in the repair of the dwelling; or 1033 (III)If the insurer has paid policy limits. 1034 3.If the insurer elects to nonrenew a policy covering a 1035 property that has been damaged, the insurer shall provide at 1036 least 90 days notice to the insured that the insurer intends to 1037 nonrenew the policy 90 days after the dwelling or residential 1038 property has been repaired. Nothing in this paragraph shall 1039 prevent the insurer from canceling or nonrenewing the policy 90 1040 days after the repairs are complete for the same reasons the 1041 insurer would otherwise have canceled or nonrenewed the policy 1042 but for the limitations of subparagraph 1. The Financial 1043 Services Commission may adopt rules, and the Commissioner of 1044 Insurance Regulation may issue orders, necessary to implement 1045 this paragraph. 1046 4.This paragraph shall also apply to personal residential 1047 and commercial residential policies covering property that was 1048 damaged as the result of Hurricane Ian or Hurricane Nicole 1049 Tropical Storm Bonnie, Hurricane Charley, Hurricane Frances, 1050 Hurricane Ivan, or Hurricane Jeanne. 1051 5.For purposes of this paragraph: 1052 a.A structure is deemed to be repaired when substantially 1053 completed and restored to the extent that it is insurable by 1054 another authorized insurer writing policies in this state. 1055 b.Insurer means an authorized insurer or an eligible 1056 surplus lines insurer. 1057 Section 19.Subsection (3) is added to section 627.426, 1058 Florida Statutes, to read: 1059 627.426Claims administration. 1060 (3)(a)The office shall ensure that each liability insurer, 1061 upon receiving actual notice of an incident or a loss that could 1062 give rise to a covered liability claim under an insurance 1063 policy: 1064 1.Assigns a duly licensed and appointed insurance adjuster 1065 to investigate the extent of the insureds probable exposure and 1066 diligently attempts to resolve any questions concerning the 1067 existence or extent of the insureds coverage. 1068 2.Based on available information, ethically evaluates 1069 every claim fairly, honestly, and with due regard for the 1070 interests of the insured; considers the extent of the claimants 1071 recoverable damages; and considers the information in a 1072 reasonable and prudent manner. 1073 3.Requests from the insured or claimant additional 1074 relevant information the insurer reasonably deems necessary to 1075 evaluate whether to settle a claim. 1076 4.Conducts all oral and written communications with the 1077 insured with the utmost honesty and complete candor. 1078 5.Makes reasonable efforts to explain to persons not 1079 represented by counsel matters requiring expertise beyond the 1080 level normally expected of a layperson with no training in 1081 insurance or claims-handling issues. 1082 6.Retains all written communications and notes and retains 1083 a summary of all verbal communications in a reasonable manner 1084 for a period of not less than 5 years after the later of the 1085 entry of a judgment against the insured in excess of policy 1086 limits becomes final or the conclusion of the extracontractual 1087 claim, if any, including any related appeals. 1088 7.Provides the insured, upon request, with all 1089 communications related to the insurers handling of the claim 1090 which are not privileged as to the insured. 1091 8.Provides, at the insurers expense, reasonable 1092 accommodations necessary to communicate effectively with an 1093 insured covered under the Americans with Disabilities Act. 1094 9.In handling third-party claims, communicates to an 1095 insured all of the following: 1096 a.The identity of any other person or entity the insurer 1097 has reason to believe may be liable. 1098 b.The insurers evaluation of the claim. 1099 c.The likelihood and possible extent of an excess 1100 judgment. 1101 d.Steps the insured can take to avoid exposure to an 1102 excess judgment, including the right to secure personal counsel 1103 at the insureds expense. 1104 e.The insureds duty to cooperate with the insurer, 1105 including any specific requests required because of a settlement 1106 opportunity or by the insurer in accordance with the policy, the 1107 purpose of the required cooperation, and the consequences of 1108 refusing to cooperate; and any settlement demands or offers. 1109 10.If, after the expiration of the safe harbor periods in 1110 s. 624.155(4) or (6), as applicable, the facts available to the 1111 insurer indicate that the insureds liability is likely to 1112 exceed the policy limits, initiates settlement negotiations by 1113 tendering its policy limits to the claimant in exchange for a 1114 general release of the insured. 1115 11.Gives fair consideration to a settlement offer that is 1116 not unreasonable under the facts available to the insurer and 1117 settle, if possible, when a reasonably prudent person, faced 1118 with the prospect of paying the total probable exposure of the 1119 insured, would do so. The insurer shall provide reasonable 1120 assistance to the insured to comply with the insureds 1121 obligations to cooperate and act reasonably to attempt to 1122 satisfy any conditions of a claimants settlement offer. If it 1123 is not possible to settle a liability claim within the available 1124 policy limits, the insurer shall act reasonably to attempt to 1125 minimize the excess exposure to the insured. 1126 12.When multiple claims arise out of a single occurrence, 1127 the combined value of all claims exceeds the total of all 1128 applicable policy limits, and the claimants are unwilling to 1129 globally settle within the policy limits, thereafter attempts to 1130 minimize the magnitude of possible excess judgments against the 1131 insured. The insurer is entitled to great discretion to decide 1132 how much to offer each respective claimant in its attempt to 1133 protect the insured. The insurer may, in its effort to minimize 1134 the excess liability of the insured, use its discretion to offer 1135 the full available policy limits to one or more claimants to the 1136 exclusion of other claimants and may leave the insured exposed 1137 to some liability after all the policy limits are paid. An 1138 insurer does not violate this section simply because it is 1139 unable to settle all claims in a multiple claimant case. 1140 13.When a loss creates the potential for a third-party 1141 claim against more than one insured, attempts to settle the 1142 claim on behalf of all insureds against whom a claim may be 1143 presented. If it is not possible to settle on behalf of all 1144 insureds, the insurer, in consultation with the insureds, must 1145 attempt to enter into reasonable settlements of claims against 1146 certain insureds to the exclusion of other insureds. 1147 14.Responds to any request for insurance information in 1148 compliance with s. 626.9372 or s. 627.4137, as applicable. 1149 15.Where it appears the insureds probable exposure is 1150 greater than policy limits, takes reasonable measures to 1151 preserve, for a reasonable period of time, evidence that is 1152 needed for the defense of the liability claim. 1153 16.Complies with s. 627.426, if applicable. 1154 17.Complies with any provision of the Unfair Insurance 1155 Trade Practices Act. 1156 (b)Violations of this section constitute violations of the 1157 Florida Insurance Code and are subject to any applicable 1158 enforcement provisions therein. 1159 Section 20.Paragraph (a) of subsection (10) of section 1160 627.701, Florida Statutes, is amended to read: 1161 627.701Liability of insureds; coinsurance; deductibles. 1162 (10)(a)Notwithstanding any other provision of law, an 1163 insurer issuing a personal lines residential property insurance 1164 policy may include in such policy a separate roof deductible 1165 that meets all of the following requirements: 1166 1.The insurer has complied with the offer requirements 1167 under subsection (7) regarding a deductible applicable to losses 1168 from perils other than a hurricane. 1169 2.The roof deductible may not exceed the lesser of 2 1170 percent of the Coverage A limit of the policy or 50 percent of 1171 the cost to replace the roof. 1172 3.The premium that a policyholder is charged for the 1173 policy includes an actuarially sound credit or premium discount 1174 for the roof deductible. 1175 4.The roof deductible applies only to a claim adjusted on 1176 a replacement cost basis. 1177 5.The roof deductible does not apply to any of the 1178 following events: 1179 a.A total loss to a primary structure in accordance with 1180 the valued policy law under s. 627.702 which is caused by a 1181 covered peril. 1182 b.A roof loss resulting from a hurricane as defined in s. 1183 627.4025(2)(c). 1184 c.A roof loss resulting from a tree fall or other hazard 1185 that damages the roof and punctures the roof deck. 1186 d.A roof loss requiring the repair of less than 50 percent 1187 of the roof. 1188 1189 If a roof deductible is applied, no other deductible under the 1190 policy may be applied to the loss or to any other loss to the 1191 property caused by the same covered peril. 1192 Section 21.Subsection (2) of section 627.70132, Florida 1193 Statutes, is amended to read: 1194 627.70132Notice of property insurance claim. 1195 (2)A claim or reopened claim, but not a supplemental 1196 claim, under an insurance policy that provides property 1197 insurance, as defined in s. 624.604, including a property 1198 insurance policy issued by an eligible surplus lines insurer, 1199 for loss or damage caused by any peril is barred unless notice 1200 of the claim was given to the insurer in accordance with the 1201 terms of the policy within 1 year after the date of loss. A 1202 supplemental claim is barred unless notice of the supplemental 1203 claim was given to the insurer in accordance with the terms of 1204 the policy within 18 months after the date of loss. The time 1205 limitations of this subsection are tolled during any term of 1206 federal or state active duty which materially affects the 1207 ability of a servicemember as defined in s. 250.01 to file a 1208 claim, supplemental claim, or reopened claim. 1209 Section 22.Section 627.7019, Florida Statutes, is amended 1210 to read: 1211 627.7019Standardization of requirements applicable to 1212 insurers after natural disasters. 1213 (1)The commission shall adopt by rule, pursuant to s. 1214 120.54(1)-(3), standardized requirements that may be applied to 1215 insurers and surplus lines insurers as a consequence of a 1216 hurricane or other natural disaster. The rules shall address the 1217 following areas: 1218 (a)Claims reporting requirements. 1219 (b)Grace periods for payment of premiums and performance 1220 of other duties by insureds. 1221 (c)Temporary postponement of cancellations and 1222 nonrenewals. 1223 (2)The rules adopted under this section shall require the 1224 office to issue an order within 72 hours after the occurrence of 1225 a hurricane or other natural disaster specifying, by line of 1226 insurance, which of the standardized requirements apply, the 1227 geographic areas in which they apply, the time at which 1228 applicability commences, and the time at which applicability 1229 terminates. 1230 (3)Any emergency rule adopted under s. 120.54(4) which is 1231 in conflict with any provision of the rules adopted under this 1232 section must be by unanimous vote of the commission. 1233 Section 23.Section 627.782, Florida Statutes, is amended 1234 to read: 1235 627.782Adoption of rates. 1236 (1)Rates for title insurance are subject to the rating 1237 provisions of this section. Title insurers shall file with the 1238 office under the procedures set forth in s. 627.062(2)(a)1. or 1239 2. rates, rating schedules, rating manuals, premium credits or 1240 discount schedules, and surcharge schedules, and changes 1241 thereto, code, the commission must adopt a rule specifying the 1242 premium to be charged in this state by title insurers for the 1243 respective types of title insurance contracts and, for policies 1244 issued through agents or agencies, the percentage of such 1245 premium required to be retained by the title insurer which shall 1246 not be less than 30 percent. However, in a transaction subject 1247 to the Real Estate Settlement Procedures Act of 1974, 12 U.S.C. 1248 ss. 2601 et seq., as amended, no portion of the premium 1249 attributable to providing a primary title service shall be paid 1250 to or retained by any person who does not actually perform or is 1251 not liable for the performance of such service. 1252 (2)In reviewing adopting premium rates, the office 1253 commission must give due consideration to the following: 1254 (a)The title insurers loss experience and prospective 1255 loss experience under closing protection letters and policy 1256 liabilities. 1257 (b)A reasonable margin for underwriting profit and 1258 contingencies, including contingent liability under s. 627.7865, 1259 sufficient to allow title insurers, agents, and agencies to earn 1260 a rate of return on their capital that will attract and retain 1261 adequate capital investment in the title insurance business and 1262 maintain an efficient title insurance delivery system. 1263 (c)Past expenses and prospective expenses for 1264 administration and handling of risks. 1265 (d)Liability for defalcation. 1266 (e)Other relevant factors. 1267 (3)Rates may be grouped by classification or schedule and 1268 may differ as to class of risk assumed. 1269 (4)Rates may not be excessive, inadequate, or unfairly 1270 discriminatory. 1271 (5)The premium applies to each $100 of insurance issued to 1272 an insured. 1273 (6)The premium rates apply throughout this state. 1274 (7)The commission shall, in accordance with the standards 1275 provided in subsection (2), review the premium as needed, but 1276 not less frequently than once every 3 years, and shall, based 1277 upon the review required by this subsection, revise the premium 1278 if the results of the review so warrant. 1279 (8)Each title insurance agency and insurer licensed to do 1280 business in this state and each insurers direct or retail 1281 business in this state shall maintain and submit information, 1282 including revenue, loss, and expense data, as the office 1283 determines necessary to assist in the analysis of title 1284 insurance premium rates, title search costs, and the condition 1285 of the title insurance industry in this state. Such information 1286 shall be transmitted to the office annually by May 31 of the 1287 year after the reporting year. The commission shall adopt rules 1288 relating to the collection and analysis of the data from the 1289 title insurance industry. 1290 Section 24.Chapter 2022-271, Laws of Florida, shall not be 1291 construed to impair any right under an insurance contract in 1292 effect on or before the effective date of that chapter law. To 1293 the extent that chapter 2022-271, Laws of Florida, affects a 1294 right under an insurance contract, that chapter law applies to 1295 an insurance contract issued or renewed after the effective date 1296 of that chapter law. This section is intended to clarify 1297 existing law and is remedial in nature. 1298 Section 25.(1)Every residential property insurer and 1299 every motor vehicle insurer rate filing made or pending with the 1300 Office of Insurance Regulation on or after July 1, 2023, must 1301 reflect the savings or reduction in claim frequency, claim 1302 severity, and loss adjustment expenses, including for attorney 1303 fees, payment of attorney fees to claimants, and any other 1304 reduction actuarially indicated, due to the combined effect of 1305 the applicable provisions of chapters 2021-77, 2022-268, 2022 1306 271, and 2023-15, Laws of Florida, in order to provide rate 1307 relief to policyholders as soon as practicable. 1308 (2)The Office of Insurance Regulation must consider in its 1309 review of such rate filings the savings or reduction in claim 1310 frequency, claim severity, and loss adjustment expenses, 1311 including for attorney fees, payment of attorney fees to 1312 claimants, and any other reduction actuarially indicated, due to 1313 the combined effect of the applicable provisions of chapters 1314 2021-77, 2022-268, 2022-271, and 2023-15, Laws of Florida. The 1315 office may develop a factor or factors using generally accepted 1316 actuarial techniques and standards to be used in its review of 1317 rate filings governed by this section. The office may contract 1318 with an appropriate vendor to advise the office in determining 1319 such factor or factors. 1320 (3)For the 2023-2024 fiscal year, the sum of $500,000 in 1321 nonrecurring funds is appropriated from the Insurance Regulatory 1322 Trust Fund in the Department of Financial Services to the Office 1323 of Insurance Regulation to implement this section. 1324 Section 26.For the 2023-2024 fiscal year, five positions 1325 with associated salary rate of 325,000 and the sum of $494,774 1326 in recurring funds and $23,410 in nonrecurring funds is 1327 appropriated from the Insurance Regulatory Trust Fund to the 1328 Department of Financial Services to implement this act. 1329 Section 27.This act shall take effect July 1, 2023.