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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to windstorm coverage by Citizens 2
Property Insurance Corporation; amending s. 627.351, 3
F.S.; removing provisions relating to windstorm risk 4
apportionment plan agreements among property insurers; 5
revising legislative findings; revising the p urpose of 6
the Citizens Property Insurance Corporation; requiring 7
the corporation to make windstorm coverage available 8
to homeowners for any residential structures; 9
providing requirements for the windstorm coverage; 10
providing construction; removing obsolete language; 11
authorizing homeowners to obtain windstorm coverage 12
from certain insurance agents; providing underwriting 13
and administering requirements for the windstorm 14
coverage portion of insurance; providing 15
administrative fees; providing requirements for c laims 16
settlement payments; removing obsolete dates; 17
requiring the corporation to make windstorm coverage 18
available for commercial lines residential structures; 19
providing requirements for the windstorm coverage; 20
providing construction; revising requirements for the 21
corporation's plan of operation; removing certain 22
definitions; revising certain statements obtained by 23
agents from applicants for coverage from the 24
corporation; providing definitions; amending s. 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
215.555, F.S.; removing obsolete language; conformi ng 26
a cross-reference; conforming a provision to changes 27
made by the act; amending ss. 215.5595, 624.805, 28
627.062, 627.0628, 627.06281, 627.0629, 627.4025, 29
627.701, 627.7018, 627.711, 627.712, 627.713, 631.54, 30
718.111, 719.104, and 720.303, F.S.; conforming 31
provisions to changes made by the act; amending ss. 32
395.1061, 458.320, 459.0085, 464.0123, 624.424, 33
624.462, 625.317, and 627.0655, F.S.; conforming 34
cross-references; amending s. 627.3511, F.S.; 35
conforming cross-references; conforming provisions to 36
changes made by the act; amending ss. 627.3512, 37
627.3513, 627.3515, 627.3517, and 627.3518, F.S.; 38
conforming cross-references; amending s. 627.4133, 39
F.S.; conforming a cross -reference; conforming a 40
provision to changes made by the act; amending ss. 41
627.945 and 628.6017, F.S.; conforming cross -42
references; providing an effective date. 43
44
Be It Enacted by the Legislature of the State of Florida: 45
46
Section 1. Subsections (3) through (8) of section 627.351, 47
Florida Statutes, are renumbered as subsections (2) thro ugh (7), 48
respectively, paragraphs (w), (x), (y), and (aa) through (nn) of 49
present subsection (6) are redesignated as paragraphs (v), (w), 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(x), and (y) through (ll) of new subsection (5), respectively, 51
present subsections (2) and (5) and paragraphs (a), (b) , (c), 52
and (o) and present paragraphs (v), (z), and (nn) of present 53
subsection (6) are amended, and a new paragraph (mm) is added to 54
present subsection (6) of that section, to read: 55
627.351 Insurance risk apportionment plans. — 56
(2) WINDSTORM INSURANCE R ISK APPORTIONMENT.— 57
(a) Agreements may be made among property insurers with 58
respect to the equitable apportionment among them of insurance 59
which may be afforded applicants who are in good faith entitled 60
to, but are unable to procure, such insurance throu gh ordinary 61
methods; and such insurers may agree among themselves on the use 62
of reasonable rate modifications for such insurance. Such 63
agreements and rate modifications shall be subject to the 64
applicable provisions of this chapter. 65
(b) The department sha ll require all insurers holding a 66
certificate of authority to transact property insurance on a 67
direct basis in this state, other than joint underwriting 68
associations and other entities formed pursuant to this section, 69
to provide windstorm coverage to appli cants from areas 70
determined to be eligible pursuant to paragraph (c) who in good 71
faith are entitled to, but are unable to procure, such coverage 72
through ordinary means; or it shall adopt a reasonable plan or 73
plans for the equitable apportionment or sharing among such 74
insurers of windstorm coverage, which may include formation of 75
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an association for this purpose. As used in this subsection, the 76
term "property insurance" means insurance on real or personal 77
property, as defined in s. 624.604, including insuranc e for 78
fire, industrial fire, allied lines, farmowners multiperil, 79
homeowners multiperil, commercial multiperil, and mobile homes, 80
and including liability coverages on all such insurance, but 81
excluding inland marine as defined in s. 624.607(3) and 82
excluding vehicle insurance as defined in s. 624.605(1)(a) other 83
than insurance on mobile homes used as permanent dwellings. The 84
department shall adopt rules that provide a formula for the 85
recovery and repayment of any deferred assessments. 86
1. For the purpose of this section, properties eligible 87
for such windstorm coverage are defined as dwellings, buildings, 88
and other structures, including mobile homes which are used as 89
dwellings and which are tied down in compliance with mobile home 90
tie-down requirements prescri bed by the Department of Highway 91
Safety and Motor Vehicles pursuant to s. 320.8325, and the 92
contents of all such properties. An applicant or policyholder is 93
eligible for coverage only if an offer of coverage cannot be 94
obtained by or for the applicant or po licyholder from an 95
admitted insurer at approved rates. 96
2.a.(I) All insurers required to be members of such 97
association shall participate in its writings, expenses, and 98
losses. Surplus of the association shall be retained for the 99
payment of claims and sha ll not be distributed to the member 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
insurers. Such participation by member insurers shall be in the 101
proportion that the net direct premiums of each member insurer 102
written for property insurance in this state during the 103
preceding calendar year bear to the a ggregate net direct 104
premiums for property insurance of all member insurers, as 105
reduced by any credits for voluntary writings, in this state 106
during the preceding calendar year. For the purposes of this 107
subsection, the term "net direct premiums" means direct written 108
premiums for property insurance, reduced by premium for 109
liability coverage and for the following if included in allied 110
lines: rain and hail on growing crops; livestock; association 111
direct premiums booked; National Flood Insurance Program direct 112
premiums; and similar deductions specifically authorized by the 113
plan of operation and approved by the department. A member's 114
participation shall begin on the first day of the calendar year 115
following the year in which it is issued a certificate of 116
authority to transact property insurance in the state and shall 117
terminate 1 year after the end of the calendar year during which 118
it no longer holds a certificate of authority to transact 119
property insurance in the state. The commissioner, after review 120
of annual statements, other reports, and any other statistics 121
that the commissioner deems necessary, shall certify to the 122
association the aggregate direct premiums written for property 123
insurance in this state by all member insurers. 124
(II) Effective July 1, 2002, the asso ciation shall operate 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
subject to the supervision and approval of a board of governors 126
who are the same individuals that have been appointed by the 127
Treasurer to serve on the board of governors of the Citizens 128
Property Insurance Corporation. 129
(III) The plan of operation shall provide a formula 130
whereby a company voluntarily providing windstorm coverage in 131
affected areas will be relieved wholly or partially from 132
apportionment of a regular assessment pursuant to sub -sub-133
subparagraph d.(I) or sub -sub-subparagraph d.(II). 134
(IV) A company which is a member of a group of companies 135
under common management may elect to have its credits applied on 136
a group basis, and any company or group may elect to have its 137
credits applied to any other company or group. 138
(V) There shall be no credits or relief from apportionment 139
to a company for emergency assessments collected from its 140
policyholders under sub -sub-subparagraph d.(III). 141
(VI) The plan of operation may also provide for the award 142
of credits, for a period not to exceed 3 years, from a regular 143
assessment pursuant to sub -sub-subparagraph d.(I) or sub -sub-144
subparagraph d.(II) as an incentive for taking policies out of 145
the Residential Property and Casualty Joint Underwriting 146
Association. In order to qualify for the exemption u nder this 147
sub-sub-subparagraph, the take -out plan must provide that at 148
least 40 percent of the policies removed from the Residential 149
Property and Casualty Joint Underwriting Association cover risks 150
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
located in Miami-Dade, Broward, and Palm Beach Counties or at 151
least 30 percent of the policies so removed cover risks located 152
in Miami-Dade, Broward, and Palm Beach Counties and an 153
additional 50 percent of the policies so removed cover risks 154
located in other coastal counties, and must also provide that no 155
more than 15 percent of the policies so removed may exclude 156
windstorm coverage. With the approval of the department, the 157
association may waive these geographic criteria for a take -out 158
plan that removes at least the lesser of 100,000 Residential 159
Property and Casualty Joint Underwriting Association policies or 160
15 percent of the total number of Residential Property and 161
Casualty Joint Underwriting Association policies, provided the 162
governing board of the Residential Property and Casualty Joint 163
Underwriting Association certifies that the take -out plan will 164
materially reduce the Residential Property and Casualty Joint 165
Underwriting Association's 100 -year probable maximum loss from 166
hurricanes. With the approval of the department, the board may 167
extend such credits for an ad ditional year if the insurer 168
guarantees an additional year of renewability for all policies 169
removed from the Residential Property and Casualty Joint 170
Underwriting Association, or for 2 additional years if the 171
insurer guarantees 2 additional years of renewab ility for all 172
policies removed from the Residential Property and Casualty 173
Joint Underwriting Association. 174
b. Assessments to pay deficits in the association under 175
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
this subparagraph shall be included as an appropriate factor in 176
the making of rates as provi ded in s. 627.3512. 177
c. The Legislature finds that the potential for unlimited 178
deficit assessments under this subparagraph may induce insurers 179
to attempt to reduce their writings in the voluntary market, and 180
that such actions would worsen the availability problems that 181
the association was created to remedy. It is the intent of the 182
Legislature that insurers remain fully responsible for paying 183
regular assessments and collecting emergency assessments for any 184
deficits of the association; however, it is also th e intent of 185
the Legislature to provide a means by which assessment 186
liabilities may be amortized over a period of years. 187
d.(I) When the deficit incurred in a particular calendar 188
year is 10 percent or less of the aggregate statewide direct 189
written premium for property insurance for the prior calendar 190
year for all member insurers, the association shall levy an 191
assessment on member insurers in an amount equal to the deficit. 192
(II) When the deficit incurred in a particular calendar 193
year exceeds 10 percent of the aggregate statewide direct 194
written premium for property insurance for the prior calendar 195
year for all member insurers, the association shall levy an 196
assessment on member insurers in an amount equal to the greater 197
of 10 percent of the deficit or 10 perc ent of the aggregate 198
statewide direct written premium for property insurance for the 199
prior calendar year for member insurers. Any remaining deficit 200
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shall be recovered through emergency assessments under sub -sub-201
subparagraph (III). 202
(III) Upon a determinat ion by the board of directors that 203
a deficit exceeds the amount that will be recovered through 204
regular assessments on member insurers, pursuant to sub -sub-205
subparagraph (I) or sub -sub-subparagraph (II), the board shall 206
levy, after verification by the depart ment, emergency 207
assessments to be collected by member insurers and by 208
underwriting associations created pursuant to this section which 209
write property insurance, upon issuance or renewal of property 210
insurance policies other than National Flood Insurance pol icies 211
in the year or years following levy of the regular assessments. 212
The amount of the emergency assessment collected in a particular 213
year shall be a uniform percentage of that year's direct written 214
premium for property insurance for all member insurers a nd 215
underwriting associations, excluding National Flood Insurance 216
policy premiums, as annually determined by the board and 217
verified by the department. The department shall verify the 218
arithmetic calculations involved in the board's determination 219
within 30 days after receipt of the information on which the 220
determination was based. Notwithstanding any other provision of 221
law, each member insurer and each underwriting association 222
created pursuant to this section shall collect emergency 223
assessments from its policy holders without such obligation being 224
affected by any credit, limitation, exemption, or deferment. The 225
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
emergency assessments so collected shall be transferred directly 226
to the association on a periodic basis as determined by the 227
association. The aggregate a mount of emergency assessments 228
levied under this sub -sub-subparagraph in any calendar year may 229
not exceed the greater of 10 percent of the amount needed to 230
cover the original deficit, plus interest, fees, commissions, 231
required reserves, and other costs ass ociated with financing of 232
the original deficit, or 10 percent of the aggregate statewide 233
direct written premium for property insurance written by member 234
insurers and underwriting associations for the prior year, plus 235
interest, fees, commissions, required r eserves, and other costs 236
associated with financing the original deficit. The board may 237
pledge the proceeds of the emergency assessments under this sub -238
sub-subparagraph as the source of revenue for bonds, to retire 239
any other debt incurred as a result of the deficit or events 240
giving rise to the deficit, or in any other way that the board 241
determines will efficiently recover the deficit. The emergency 242
assessments under this sub -sub-subparagraph shall continue as 243
long as any bonds issued or other indebtedness in curred with 244
respect to a deficit for which the assessment was imposed remain 245
outstanding, unless adequate provision has been made for the 246
payment of such bonds or other indebtedness pursuant to the 247
document governing such bonds or other indebtedness. Emerg ency 248
assessments collected under this sub -sub-subparagraph are not 249
part of an insurer's rates, are not premium, and are not subject 250
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to premium tax, fees, or commissions; however, failure to pay 251
the emergency assessment shall be treated as failure to pay 252
premium. 253
(IV) Each member insurer's share of the total regular 254
assessments under sub -sub-subparagraph (I) or sub -sub-255
subparagraph (II) shall be in the proportion that the insurer's 256
net direct premium for property insurance in this state, for the 257
year preceding the assessment bears to the aggregate statewide 258
net direct premium for property insurance of all member 259
insurers, as reduced by any credits for voluntary writings for 260
that year. 261
(V) If regular deficit assessments are made under sub -sub-262
subparagraph (I) or sub-sub-subparagraph (II), the association 263
shall levy upon the association's policyholders, as part of its 264
next rate filing, or by a separate rate filing solely for this 265
purpose, a market equalization surcharge in a percentage equal 266
to the total amount of such regular assessments divided by the 267
aggregate statewide direct written premium for property 268
insurance for member insurers for the prior calendar year. 269
Market equalization surcharges under this sub -sub-subparagraph 270
are not considered premium and are not subject to commissions, 271
fees, or premium taxes; however, failure to pay a market 272
equalization surcharge shall be treated as failure to pay 273
premium. 274
e. The governing body of any unit of local government, any 275
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
residents of which are insured under th e plan, may issue bonds 276
as defined in s. 125.013 or s. 166.101 to fund an assistance 277
program, in conjunction with the association, for the purpose of 278
defraying deficits of the association. In order to avoid 279
needless and indiscriminate proliferation, duplic ation, and 280
fragmentation of such assistance programs, any unit of local 281
government, any residents of which are insured by the 282
association, may provide for the payment of losses, regardless 283
of whether or not the losses occurred within or outside of the 284
territorial jurisdiction of the local government. Revenue bonds 285
may not be issued until validated pursuant to chapter 75, unless 286
a state of emergency is declared by executive order or 287
proclamation of the Governor pursuant to s. 252.36 making such 288
findings as are necessary to determine that it is in the best 289
interests of, and necessary for, the protection of the public 290
health, safety, and general welfare of residents of this state 291
and the protection and preservation of the economic stability of 292
insurers operating in this state, and declaring it an essential 293
public purpose to permit certain municipalities or counties to 294
issue bonds as will provide relief to claimants and 295
policyholders of the association and insurers responsible for 296
apportionment of plan losses. An y such unit of local government 297
may enter into such contracts with the association and with any 298
other entity created pursuant to this subsection as are 299
necessary to carry out this paragraph. Any bonds issued under 300
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this sub-subparagraph shall be payable fro m and secured by 301
moneys received by the association from assessments under this 302
subparagraph, and assigned and pledged to or on behalf of the 303
unit of local government for the benefit of the holders of such 304
bonds. The funds, credit, property, and taxing pow er of the 305
state or of the unit of local government shall not be pledged 306
for the payment of such bonds. If any of the bonds remain unsold 307
60 days after issuance, the department shall require all 308
insurers subject to assessment to purchase the bonds, which 309
shall be treated as admitted assets; each insurer shall be 310
required to purchase that percentage of the unsold portion of 311
the bond issue that equals the insurer's relative share of 312
assessment liability under this subsection. An insurer shall not 313
be required to purchase the bonds to the extent that the 314
department determines that the purchase would endanger or impair 315
the solvency of the insurer. The authority granted by this sub -316
subparagraph is additional to any bonding authority granted by 317
subparagraph 6. 318
3. The plan shall also provide that any member with a 319
surplus as to policyholders of $25 million or less writing 25 320
percent or more of its total countrywide property insurance 321
premiums in this state may petition the department, within the 322
first 90 days of eac h calendar year, to qualify as a limited 323
apportionment company. The apportionment of such a member 324
company in any calendar year for which it is qualified shall not 325
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exceed its gross participation, which shall not be affected by 326
the formula for voluntary wri tings. In no event shall a limited 327
apportionment company be required to participate in any 328
apportionment of losses pursuant to sub -sub-subparagraph 2.d.(I) 329
or sub-sub-subparagraph 2.d.(II) in the aggregate which exceeds 330
$50 million after payment of availab le plan funds in any 331
calendar year. However, a limited apportionment company shall 332
collect from its policyholders any emergency assessment imposed 333
under sub-sub-subparagraph 2.d.(III). The plan shall provide 334
that, if the department determines that any regu lar assessment 335
will result in an impairment of the surplus of a limited 336
apportionment company, the department may direct that all or 337
part of such assessment be deferred. However, there shall be no 338
limitation or deferment of an emergency assessment to be 339
collected from policyholders under sub -sub-subparagraph 340
2.d.(III). 341
4. The plan shall provide for the deferment, in whole or 342
in part, of a regular assessment of a member insurer under sub -343
sub-subparagraph 2.d.(I) or sub -sub-subparagraph 2.d.(II), but 344
not for an emergency assessment collected from policyholders 345
under sub-sub-subparagraph 2.d.(III), if, in the opinion of the 346
commissioner, payment of such regular assessment would endanger 347
or impair the solvency of the member insurer. In the event a 348
regular assessment against a member insurer is deferred in whole 349
or in part, the amount by which such assessment is deferred may 350
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be assessed against the other member insurers in a manner 351
consistent with the basis for assessments set forth in sub -sub-352
subparagraph 2.d.(I) or sub-sub-subparagraph 2.d.(II). 353
5.a. The plan of operation may include deductibles and 354
rules for classification of risks and rate modifications 355
consistent with the objective of providing and maintaining funds 356
sufficient to pay catastrophe losses. 357
b. It is the intent of the Legislature that the rates for 358
coverage provided by the association be actuarially sound and 359
not competitive with approved rates charged in the admitted 360
voluntary market such that the association functions as a 361
residual market mechanism to provide insurance only when the 362
insurance cannot be procured in the voluntary market. The plan 363
of operation shall provide a mechanism to assure that, beginning 364
no later than January 1, 1999, the rates charged by the 365
association for each line of business are reflective of approved 366
rates in the voluntary market for hurricane coverage for each 367
line of business in the various areas eligible for association 368
coverage. 369
c. The association shall provide for windstorm coverage on 370
residential properties i n limits up to $10 million for 371
commercial lines residential risks and up to $1 million for 372
personal lines residential risks. If coverage with the 373
association is sought for a residential risk valued in excess of 374
these limits, coverage shall be available to the risk up to the 375
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replacement cost or actual cash value of the property, at the 376
option of the insured, if coverage for the risk cannot be 377
located in the authorized market. The association must accept a 378
commercial lines residential risk with limits above $ 10 million 379
or a personal lines residential risk with limits above $1 380
million if coverage is not available in the authorized market. 381
The association may write coverage above the limits specified in 382
this subparagraph with or without facultative or other 383
reinsurance coverage, as the association determines appropriate. 384
d. The plan of operation must provide objective criteria 385
and procedures, approved by the department, to be uniformly 386
applied for all applicants in determining whether an individual 387
risk is so hazardous as to be uninsurable. In making this 388
determination and in establishing the criteria and procedures, 389
the following shall be considered: 390
(I) Whether the likelihood of a loss for the individual 391
risk is substantially higher than for other risks of t he same 392
class; and 393
(II) Whether the uncertainty associated with the 394
individual risk is such that an appropriate premium cannot be 395
determined. 396
397
The acceptance or rejection of a risk by the association 398
pursuant to such criteria and procedures must be const rued as 399
the private placement of insurance, and the provisions of 400
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chapter 120 do not apply. 401
e. If the risk accepts an offer of coverage through the 402
market assistance program or through a mechanism established by 403
the association, either before the policy is issued by the 404
association or during the first 30 days of coverage by the 405
association, and the producing agent who submitted the 406
application to the association is not currently appointed by the 407
insurer, the insurer shall: 408
(I) Pay to the producing agent of record of the policy, 409
for the first year, an amount that is the greater of the 410
insurer's usual and customary commission for the type of policy 411
written or a fee equal to the usual and customary commission of 412
the association; or 413
(II) Offer to allow the producing agent of record of the 414
policy to continue servicing the policy for a period of not less 415
than 1 year and offer to pay the agent the greater of the 416
insurer's or the association's usual and customary commission 417
for the type of policy written. 418
419
If the producing agent is unwilling or unable to accept 420
appointment, the new insurer shall pay the agent in accordance 421
with sub-sub-subparagraph (I). Subject to the provisions of s. 422
627.3517, the policies issued by the association must provide 423
that if the association obtains an offer from an authorized 424
insurer to cover the risk at its approved rates under either a 425
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standard policy including wind coverage or, if consistent with 426
the insurer's underwriting rules as filed with the department, a 427
basic policy includin g wind coverage, the risk is no longer 428
eligible for coverage through the association. Upon termination 429
of eligibility, the association shall provide written notice to 430
the policyholder and agent of record stating that the 431
association policy must be canceled as of 60 days after the date 432
of the notice because of the offer of coverage from an 433
authorized insurer. Other provisions of the insurance code 434
relating to cancellation and notice of cancellation do not apply 435
to actions under this sub -subparagraph. 436
f. When the association enters into a contractual 437
agreement for a take -out plan, the producing agent of record of 438
the association policy is entitled to retain any unearned 439
commission on the policy, and the insurer shall: 440
(I) Pay to the producing agent of reco rd of the 441
association policy, for the first year, an amount that is the 442
greater of the insurer's usual and customary commission for the 443
type of policy written or a fee equal to the usual and customary 444
commission of the association; or 445
(II) Offer to allow the producing agent of record of the 446
association policy to continue servicing the policy for a period 447
of not less than 1 year and offer to pay the agent the greater 448
of the insurer's or the association's usual and customary 449
commission for the type of polic y written. 450
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451
If the producing agent is unwilling or unable to accept 452
appointment, the new insurer shall pay the agent in accordance 453
with sub-sub-subparagraph (I). 454
6.a. The plan of operation may authorize the formation of 455
a private nonprofit corporation, a private nonprofit 456
unincorporated association, a partnership, a trust, a limited 457
liability company, or a nonprofit mutual company which may be 458
empowered, among other things, to borrow money by issuing bonds 459
or by incurring other indebtedness and to accumul ate reserves or 460
funds to be used for the payment of insured catastrophe losses. 461
The plan may authorize all actions necessary to facilitate the 462
issuance of bonds, including the pledging of assessments or 463
other revenues. 464
b. Any entity created under this su bsection, or any entity 465
formed for the purposes of this subsection, may sue and be sued, 466
may borrow money; issue bonds, notes, or debt instruments; 467
pledge or sell assessments, market equalization surcharges and 468
other surcharges, rights, premiums, contractu al rights, 469
projected recoveries from the Florida Hurricane Catastrophe 470
Fund, other reinsurance recoverables, and other assets as 471
security for such bonds, notes, or debt instruments; enter into 472
any contracts or agreements necessary or proper to accomplish 473
such borrowings; and take other actions necessary to carry out 474
the purposes of this subsection. The association may issue bonds 475
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or incur other indebtedness, or have bonds issued on its behalf 476
by a unit of local government pursuant to subparagraph (6)(q)2., 477
in the absence of a hurricane or other weather -related event, 478
upon a determination by the association subject to approval by 479
the department that such action would enable it to efficiently 480
meet the financial obligations of the association and that such 481
financings are reasonably necessary to effectuate the 482
requirements of this subsection. Any such entity may accumulate 483
reserves and retain surpluses as of the end of any association 484
year to provide for the payment of losses incurred by the 485
association during th at year or any future year. The association 486
shall incorporate and continue the plan of operation and 487
articles of agreement in effect on the effective date of chapter 488
76-96, Laws of Florida, to the extent that it is not 489
inconsistent with chapter 76 -96, and as subsequently modified 490
consistent with chapter 76 -96. The board of directors and 491
officers currently serving shall continue to serve until their 492
successors are duly qualified as provided under the plan. The 493
assets and obligations of the plan in effect imm ediately prior 494
to the effective date of chapter 76 -96 shall be construed to be 495
the assets and obligations of the successor plan created herein. 496
c. In recognition of s. 10, Art. I of the State 497
Constitution, prohibiting the impairment of obligations of 498
contracts, it is the intent of the Legislature that no action be 499
taken whose purpose is to impair any bond indenture or financing 500
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agreement or any revenue source committed by contract to such 501
bond or other indebtedness issued or incurred by the association 502
or any other entity created under this subsection. 503
7. On such coverage, an agent's remuneration shall be that 504
amount of money payable to the agent by the terms of his or her 505
contract with the company with which the business is placed. 506
However, no commission will be paid on that portion of the 507
premium which is in excess of the standard premium of that 508
company. 509
8. Subject to approval by the dep artment, the association 510
may establish different eligibility requirements and operational 511
procedures for any line or type of coverage for any specified 512
eligible area or portion of an eligible area if the board 513
determines that such changes to the eligibilit y requirements and 514
operational procedures are justified due to the voluntary market 515
being sufficiently stable and competitive in such area or for 516
such line or type of coverage and that consumers who, in good 517
faith, are unable to obtain insurance through th e voluntary 518
market through ordinary methods would continue to have access to 519
coverage from the association. When coverage is sought in 520
connection with a real property transfer, such requirements and 521
procedures shall not provide for an effective date of cov erage 522
later than the date of the closing of the transfer as 523
established by the transferor, the transferee, and, if 524
applicable, the lender. 525
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9. Notwithstanding any other provision of law: 526
a. The pledge or sale of, the lien upon, and the security 527
interest in any rights, revenues, or other assets of the 528
association created or purported to be created pursuant to any 529
financing documents to secure any bonds or other indebtedness of 530
the association shall be and remain valid and enforceable, 531
notwithstanding the commencement of and during the continuation 532
of, and after, any rehabilitation, insolvency, liquidation, 533
bankruptcy, receivership, conservatorship, reorganization, or 534
similar proceeding against the association under the laws of 535
this state or any other appli cable laws. 536
b. No such proceeding shall relieve the association of its 537
obligation, or otherwise affect its ability to perform its 538
obligation, to continue to collect, or levy and collect, 539
assessments, market equalization or other surcharges, projected 540
recoveries from the Florida Hurricane Catastrophe Fund, 541
reinsurance recoverables, or any other rights, revenues, or 542
other assets of the association pledged. 543
c. Each such pledge or sale of, lien upon, and security 544
interest in, including the priority of such pledge, lien, or 545
security interest, any such assessments, emergency assessments, 546
market equalization or renewal surcharges, projected recoveries 547
from the Florida Hurricane Catastrophe Fund, reinsurance 548
recoverables, or other rights, revenues, or other asse ts which 549
are collected, or levied and collected, after the commencement 550
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of and during the pendency of or after any such proceeding shall 551
continue unaffected by such proceeding. 552
d. As used in this subsection, the term "financing 553
documents" means any agree ment, instrument, or other document 554
now existing or hereafter created evidencing any bonds or other 555
indebtedness of the association or pursuant to which any such 556
bonds or other indebtedness has been or may be issued and 557
pursuant to which any rights, revenu es, or other assets of the 558
association are pledged or sold to secure the repayment of such 559
bonds or indebtedness, together with the payment of interest on 560
such bonds or such indebtedness, or the payment of any other 561
obligation of the association related to such bonds or 562
indebtedness. 563
e. Any such pledge or sale of assessments, revenues, 564
contract rights or other rights or assets of the association 565
shall constitute a lien and security interest, or sale, as the 566
case may be, that is immediately effective and a ttaches to such 567
assessments, revenues, contract, or other rights or assets, 568
whether or not imposed or collected at the time the pledge or 569
sale is made. Any such pledge or sale is effective, valid, 570
binding, and enforceable against the association or other e ntity 571
making such pledge or sale, and valid and binding against and 572
superior to any competing claims or obligations owed to any 573
other person or entity, including policyholders in this state, 574
asserting rights in any such assessments, revenues, contract, or 575
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other rights or assets to the extent set forth in and in 576
accordance with the terms of the pledge or sale contained in the 577
applicable financing documents, whether or not any such person 578
or entity has notice of such pledge or sale and without the need 579
for any physical delivery, recordation, filing, or other action. 580
f. There shall be no liability on the part of, and no 581
cause of action of any nature shall arise against, any member 582
insurer or its agents or employees, agents or employees of the 583
association, members of the board of directors of the 584
association, or the department or its representatives, for any 585
action taken by them in the performance of their duties or 586
responsibilities under this subsection. Such immunity does not 587
apply to actions for breach of an y contract or agreement 588
pertaining to insurance, or any willful tort. 589
(c) The provisions of paragraph (b) are applicable only 590
with respect to: 591
1. Those areas that were eligible for coverage under this 592
subsection on April 9, 1993; or 593
2. Any county or area as to which the department, after 594
public hearing, finds that the following criteria exist: 595
a. Due to the lack of windstorm insurance coverage in the 596
county or area so affected, economic growth and development is 597
being deterred or otherwise stifled i n such county or area, 598
mortgages are in default, and financial institutions are unable 599
to make loans; 600
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b. The county or area so affected is enforcing the 601
structural requirements of the Florida Building Code, as defined 602
in s. 553.73, for new construction a nd has included adequate 603
minimum floor elevation requirements for structures in areas 604
subject to inundation; and 605
c. Extending windstorm insurance coverage to such county 606
or area is consistent with and will implement and further the 607
policies and objective s set forth in applicable state laws, 608
rules, and regulations governing coastal management, coastal 609
construction, comprehensive planning, beach and shore 610
preservation, barrier island preservation, coastal zone 611
protection, and the Coastal Zone Protection Act of 1985. 612
613
The department shall consider reports of the Florida Building 614
Commission when evaluating building code enforcement. Any time 615
after the department has determined that the criteria referred 616
to in this subparagraph do not exist with respect to any county 617
or area of the state, it may, after a subsequent public hearing, 618
declare that such county or area is no longer eligible for 619
windstorm coverage through the plan. 620
(d) For the purpose of evaluating whether the criteria of 621
paragraph (c) are met, such criteria shall be applied as the 622
situation would exist if policies had not been written by the 623
Florida Residential Property and Casualty Joint Underwriting 624
Association and property insurance for such policyholders was 625
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not available. 626
(e)1. Notwithstanding the provisions of subparagraph (c)2. 627
or paragraph (d), eligibility shall not be extended to any area 628
that was not eligible on March 1, 1997, except that the 629
department may act with respect to any petition on which a 630
hearing was held prior to May 9, 1997. 631
2. Notwithstanding the provisions of subparagraph 1., the 632
following area is eligible for coverage under this subsection 633
effective July 1, 2002: the area within Port Canaveral which is 634
bordered on the south by the City of Cape Canaveral, bordered on 635
the west by the Banana River, and bordered on the north by 636
United States Government property. 637
(f) As used in this subsection, the term "department" 638
means the former Department of Insurance. 639
(4)(5) PROPERTY AND CASUALTY INSURANCE RISK 640
APPORTIONMENT.—The commission shall adopt by rule a joint 641
underwriting plan to equitably apportion among insurers 642
authorized in this state to write property insurance as defined 643
in s. 624.604 or casualty insurance as defined in s. 624.605, 644
the underwriting of one or more classes of property insurance or 645
casualty insurance, except for the types of insurance that are 646
included within property insurance or casualty insurance for 647
which an equitable apportionment plan, assigned risk plan, or 648
joint underwriting plan is authorized under s. 627.311 or 649
subsection (1), subsection (2), subsection (3), or this 650
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subsection (4), or subsection (5) and except for risks eligible 651
for flood insurance written through the federal flood insurance 652
program to persons with risks eligible under subparagraph (a)1. 653
and who are in good faith entitled to, but are unable to, obtain 654
such property or casualty insurance coverage, including excess 655
coverage, through the voluntary market. For purposes of this 656
subsection, an adequate level of coverage means that coverage 657
which is required by state law or by responsible or prudent 658
business practices. The Joint Underwriting Association shall not 659
be required to provide coverage for any type of risk for which 660
there are no insurers providing similar coverage in this state. 661
The office may designate one or more participating insurers who 662
agree to provide policyholder and claims service, including the 663
issuance of policies, on behalf of the participating insurers. 664
(a) The plan shall provide: 665
1. A means of establishing eligibili ty of a risk for 666
obtaining insurance through the plan, which provides that: 667
a. A risk shall be eligible for such property insurance or 668
casualty insurance as is required by Florida law if the 669
insurance is unavailable in the voluntary market, including the 670
market assistance program and the surplus lines market. 671
b. A commercial risk not eligible under sub -subparagraph 672
a. shall be eligible for property or casualty insurance if: 673
(I) The insurance is unavailable in the voluntary market, 674
including the market assistance plan and the surplus lines 675
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market; 676
(II) Failure to secure the insurance would substantially 677
impair the ability of the entity to conduct its affairs; and 678
(III) The risk is not determined by the Risk Underwriting 679
Committee to be uninsurable. 680
c. In the event the Federal Government terminates the 681
Federal Crime Insurance Program established under 44 C.F.R. ss. 682
80-83, Florida commercial and residential risks previously 683
insured under the federal program shall be eligible under the 684
plan. 685
d.(I) In the event a risk is eligible under this paragraph 686
and in the event the market assistance plan receives a minimum 687
of 100 applications for coverage within a 3 -month period, or 200 688
applications for coverage within a 1 -year period or less, for a 689
given class of risk contained in the classification system 690
defined in the plan of operation of the Joint Underwriting 691
Association, and unless the market assistance plan provides a 692
quotation for at least 80 percent of such applicants, such 693
classification shall immediat ely be eligible for coverage in the 694
Joint Underwriting Association. 695
(II) Any market assistance plan application which is 696
rejected because an individual risk is so hazardous as to be 697
practically uninsurable, considering whether the likelihood of a 698
loss for such a risk is substantially higher than for other 699
risks of the same class due to individual risk characteristics, 700
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prior loss experience, unwillingness to cooperate with a prior 701
insurer, physical characteristics and physical location shall 702
not be included in the minimum percentage calculation provided 703
above. In the event that there is any legal or administrative 704
challenge to a determination by the office that the conditions 705
of this subparagraph have been met for eligibility for coverage 706
in the Joint Underwriting Association for a given 707
classification, any eligible risk may obtain coverage during the 708
pendency of any such challenge. 709
e. In order to qualify as a quotation for the purpose of 710
meeting the minimum percentage calculation in this subparagraph, 711
the quoted premium must meet the following criteria: 712
(I) In the case of an admitted carrier, the quoted premium 713
must not exceed the premium available for a given classification 714
currently in use by the Joint Underwriting Association or the 715
premium developed by using the rates and rating plans on file 716
with the office by the quoting insurer, whichever is greater. 717
(II) In the case of an authorized surplus lines insurer, 718
the quoted premium must not exceed the premium available for a 719
given classification current ly in use by the Joint Underwriting 720
Association by more than 25 percent, after consideration of any 721
individual risk surcharge or credit. 722
f. Any agent who falsely certifies the unavailability of 723
coverage as provided by sub -subparagraphs a. and b., is subj ect 724
to the penalties provided in s. 626.611. 725
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2. A means for the equitable apportionment of profits or 726
losses and expenses among participating insurers. 727
3. Rules for the classification of risks and rates which 728
reflect the past and prospective loss exper ience. 729
4. A rating plan which reasonably reflects the prior 730
claims experience of the insureds. Such rating plan shall 731
include at least two levels of rates for risks that have 732
favorable loss experience and risks that have unfavorable loss 733
experience, as established by the plan. 734
5. Reasonable limits to available amounts of insurance. 735
Such limits may not be less than the amounts of insurance 736
required of eligible risks by Florida law. 737
6. Risk management requirements for insurance where such 738
requirements are reasonable and are expected to reduce losses. 739
7. Deductibles as may be necessary to meet the needs of 740
insureds. 741
8. Policy forms which are consistent with the forms in use 742
by the majority of the insurers providing coverage in the 743
voluntary market for the coverage requested by the applicant. 744
9. A means to remove risks from the plan once such risks 745
no longer meet the eligibility requirements of this paragraph. 746
For this purpose, the plan shall include the following 747
requirements: At each 6 -month interval after the activation of 748
any class of insureds, the board of governors or its designated 749
committee shall review the number of applications to the market 750
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
assistance plan for that class. If, based on these latest 751
numbers, at least 90 percent of such applica tions have been 752
provided a quotation, the Joint Underwriting Association shall 753
cease underwriting new applications for such class within 30 754
days, and notification of this decision shall be sent to the 755
office, the major agents' associations, and the board o f 756
directors of the market assistance plan. A quotation for the 757
purpose of this subparagraph shall meet the same criteria for a 758
quotation as provided in sub -subparagraph 1.e. All policies 759
which were previously written for that class shall continue in 760
force until their normal expiration date, at which time, subject 761
to the required timely notification of nonrenewal by the Joint 762
Underwriting Association, the insured may then elect to reapply 763
to the Joint Underwriting Association according to the 764
requirements of eligibility. If, upon reapplication, those 765
previously insured Joint Underwriting Association risks meet the 766
eligibility requirements, the Joint Underwriting Association 767
shall provide the coverage requested. 768
10. A means for providing credits to insurers against any 769
deficit assessment levied pursuant to paragraph (c), for risks 770
voluntarily written through the market assistance plan by such 771
insurers. 772
11. That the Joint Underwriting Association shall operate 773
subject to the supervision and approval of a boa rd of governors 774
consisting of 13 individuals appointed by the Chief Financial 775
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Officer, and shall have an executive or underwriting committee. 776
At least four of the members shall be representatives of 777
insurance trade associations as follows: one member from the 778
American Insurance Association, one member from the Alliance of 779
American Insurers, one member from the National Association of 780
Independent Insurers, and one member from an unaffiliated 781
insurer writing coverage on a national basis. Two 782
representatives shall be from two of the statewide agents' 783
associations. Each board member shall be appointed to serve for 784
2-year terms beginning on a date designated by the plan and 785
shall serve at the pleasure of the Chief Financial Officer. 786
Members may be reappointed for subsequent terms. 787
(b) Rates used by the Joint Underwriting Association shall 788
be actuarially sound. To the extent applicable, the rate 789
standards set forth in s. 627.062 shall be considered by the 790
office in establishing rates to be used by the joint 791
underwriting plan. The initial rate level shall be determined 792
using the rates, rules, rating plans, and classifications 793
contained in the most current Insurance Services Office (ISO) 794
filing with the office or the filing of other licensed rating 795
organizations with an additional increment of 25 percent of 796
premium. For any type of coverage or classification which lends 797
itself to manual rating for which the Insurance Services Office 798
or another licensed rating organization does not file or publish 799
a rate, the Joint Un derwriting Association shall file and use an 800
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initial rate based on the average current market rate. The 801
initial rate level for the rate plan shall also be subject to an 802
experience and schedule rating plan which may produce a maximum 803
of 25 percent debits or credits. For any risk which does not 804
lend itself to manual rating and for which no rate has been 805
promulgated under the rate plan, the board shall develop and 806
file with the office, subject to its approval, appropriate 807
criteria and factors for rating the in dividual risk. Such 808
criteria and factors shall include, but not be limited to, loss 809
rating plans, composite rating plans, and unique and unusual 810
risk rating plans. The initial rates required under this 811
paragraph shall be adjusted in conformity with future filings by 812
the Insurance Services Office with the office and shall remain 813
in effect until such time as the Joint Underwriting Association 814
has sufficient data as to independently justify an actuarially 815
sound change in such rates. 816
(c)1. In the event an und erwriting deficit exists for any 817
policy year the plan is in effect, any surplus which has accrued 818
from previous years and is not projected within reasonable 819
actuarial certainty to be needed for payment for claims in the 820
year the surplus arose shall be used to offset the deficit to 821
the extent available. 822
2. As to any remaining deficit, the board of governors of 823
the Joint Underwriting Association shall levy and collect an 824
assessment in an amount sufficient to offset such deficit. Such 825
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assessment shall be lev ied against the insurers participating in 826
the plan during the year giving rise to the assessment. Any 827
assessments against insurers for the lines of property and 828
casualty insurance issued to commercial risks shall be recovered 829
from the participating insurer s in the proportion that the net 830
direct premium of each insurer for commercial risks written 831
during the preceding calendar year bears to the aggregate net 832
direct premium written for commercial risks by all members of 833
the plan for the lines of insurance inc luded in the plan. Any 834
assessments against insurers for the lines of property and 835
casualty insurance issued to personal risks eligible under sub -836
subparagraph (a)1.a. or sub -subparagraph (a)1.c. shall be 837
recovered from the participating insurers in the prop ortion that 838
the net direct premium of each insurer for personal risks 839
written during the preceding calendar year bears to the 840
aggregate net direct premium written for personal risks by all 841
members of the plan for the lines of insurance included in the 842
plan. 843
3. The board shall take all reasonable and prudent steps 844
necessary to collect the amount of assessment due from each 845
participating insurer and policyholder, including, if prudent, 846
filing suit to collect such assessment. If the board is unable 847
to collect an assessment from any insurer, the uncollected 848
assessments shall be levied as an additional assessment against 849
the participating insurers and any participating insurer 850
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required to pay an additional assessment as a result of such 851
failure to pay shall hav e a cause of action against such 852
nonpaying insurer. 853
4. Any funds or entitlements that the state may be 854
eligible to receive by virtue of the Federal Government's 855
termination of the Federal Crime Insurance Program referenced in 856
sub-subparagraph (a)1.c. may be used under the plan to offset 857
any subsequent underwriting deficits that may occur from risks 858
previously insured with the Federal Crime Insurance Program. 859
5. Assessments shall be included as an appropriate factor 860
in the making of rates as provided in s. 627.3512. 861
6.a. The Legislature finds that the potential for 862
unlimited assessments under this paragraph may induce insurers 863
to attempt to reduce their writings in the voluntary market, and 864
that such actions would worsen the availability problems that 865
the association was created to remedy. It is the intent of the 866
Legislature that insurers remain fully responsible for covering 867
any deficits of the association; however, it is also the intent 868
of the Legislature to provide a means by which assessment 869
liabilities may be amortized over a period of years. 870
b. The total amount of deficit assessments under this 871
paragraph with respect to any year may not exceed 10 percent of 872
the statewide total gross written premium for all insurers for 873
the coverages referred to in the introductory language of this 874
subsection for the prior year, except that if the deficit with 875
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respect to any plan year exceeds such amount and bonds are 876
issued under sub-subparagraph c. to defray the deficit, the 877
total amount of assessments with respec t to such deficit may not 878
in any year exceed 10 percent of the deficit, or such lesser 879
percentage as is sufficient to retire the bonds as determined by 880
the board, and shall continue annually until the bonds are 881
retired. 882
c. The governing body of any unit of local government, any 883
residents or businesses of which are insured by the association, 884
may issue bonds as defined in s. 125.013 or s. 166.101 from time 885
to time to fund an assistance program, in conjunction with the 886
association, for the purpose of defray ing deficits of the 887
association. Revenue bonds may not be issued until validated 888
pursuant to chapter 75, unless a state of emergency is declared 889
by executive order or proclamation of the Governor pursuant to 890
s. 252.36 making such findings as are necessary to determine 891
that it is in the best interests of, and necessary for, the 892
protection of the public health, safety, and general welfare of 893
residents of this state and the protection and preservation of 894
the economic stability of insurers operating in this sta te, and 895
declaring it an essential public purpose to permit certain 896
municipalities or counties to issue such bonds as will provide 897
relief to claimants and policyholders of the joint underwriting 898
association and insurers responsible for apportionment of 899
association losses. The unit of local government shall enter 900
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into such contracts with the association as are necessary to 901
carry out this paragraph. Any bonds issued under this sub -902
subparagraph shall be payable from and secured by moneys 903
received by the associa tion from assessments under this 904
paragraph, and assigned and pledged to or on behalf of the unit 905
of local government for the benefit of the holders of such 906
bonds. The funds, credit, property, and taxing power of the 907
state or of the unit of local government shall not be pledged 908
for the payment of such bonds. If any of the bonds remain unsold 909
60 days after issuance, the office shall require all insurers 910
subject to assessment to purchase the bonds, which shall be 911
treated as admitted assets; each insurer shall be required to 912
purchase that percentage of the unsold portion of the bond issue 913
that equals the insurer's relative share of assessment liability 914
under this subsection. An insurer shall not be required to 915
purchase the bonds to the extent that the office det ermines that 916
the purchase would endanger or impair the solvency of the 917
insurer. 918
7. The plan shall provide for the deferment, in whole or 919
in part, of the assessment of an insurer if the office finds 920
that payment of the assessment would endanger or impair the 921
solvency of the insurer. In the event an assessment against an 922
insurer is deferred in whole or in part, the amount by which 923
such assessment is deferred may be assessed against the other 924
member insurers in a manner consistent with the basis for 925
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assessments set forth in subparagraph 2. 926
(d) Upon adoption of the plan, all insurers authorized in 927
this state to underwrite property or casualty insurance shall 928
participate in the plan. 929
(e) A Risk Underwriting Committee of the Joint 930
Underwriting Association composed of three members experienced 931
in evaluating insurance risks is created to review risks 932
rejected by the voluntary market for which application is made 933
for insurance through the joint underwriting plan. The committee 934
shall consist of a representative of the market assistance plan 935
created under s. 627.3515, a member selected by the insurers 936
participating in the Joint Underwriting Association, and a 937
member named by the Chief Financial Officer. The Risk 938
Underwriting Committee shall appoint such advisory committees as 939
are provided for in the plan and are necessary to conduct its 940
functions. The salaries and expenses of the members of the Risk 941
Underwriting Committee and its advisory committees shall be paid 942
by the joint underwriting plan. The plan approved b y the office 943
shall establish criteria and procedures for use by the Risk 944
Underwriting Committee for determining whether an individual 945
risk is so hazardous as to be uninsurable. In making this 946
determination and in establishing the criteria and procedures, 947
the following shall be considered: 948
1. Whether the likelihood of a loss for the individual 949
risk is substantially higher than for other risks of the same 950
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class; and 951
2. Whether the uncertainty associated with the individual 952
risk is such that an appropriate premium cannot be determined. 953
954
The acceptance or rejection of a risk by the underwriting 955
committee shall be construed as the private placement of 956
insurance, and the provisions of chapter 120 shall not apply. 957
(f) There shall be no liability on the part o f, and no 958
cause of action of any nature shall arise against, any member 959
insurer or its agents or employees, the Florida Property and 960
Casualty Joint Underwriting Association or its agents or 961
employees, members of the board of governors, the Chief 962
Financial Officer, or the office or its representatives for any 963
action taken by them in the performance of their duties under 964
this subsection. Such immunity does not apply to actions for 965
breach of any contract or agreement pertaining to insurance, or 966
any other willful tort. 967
(5)(6) CITIZENS PROPERTY INSURANCE CORPORATION. — 968
(a) The public purpose of this subsection is to ensure 969
that there is an orderly market for property insurance for 970
residents and businesses of this state. 971
1. The Legislature finds that private insurers are 972
unwilling or unable to provide affordable property insurance 973
coverage in this state to the extent sought and needed. The 974
absence of affordable property insurance threatens the public 975
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health, safety, and welfare and likewise threatens the econo mic 976
health of the state. The state therefore has a compelling public 977
interest and a public purpose to assist in assuring that 978
property in the state is insured and that it is insured at 979
affordable rates so as to facilitate the remediation, 980
reconstruction, and replacement of damaged or destroyed property 981
in order to reduce or avoid the negative effects otherwise 982
resulting to the public health, safety, and welfare, to the 983
economy of the state, and to the revenues of the state and local 984
governments which are ne eded to provide for the public welfare. 985
It is necessary, therefore, to provide affordable property 986
insurance to applicants who are in good faith entitled to 987
procure insurance through the voluntary market but are unable to 988
do so. The Legislature intends, th erefore, that affordable 989
property insurance be provided and that it continue to be 990
provided, as long as necessary, through Citizens Property 991
Insurance Corporation, a government entity that is an integral 992
part of the state, and that is not a private insuran ce company. 993
To that end, the corporation shall strive to increase the 994
availability of affordable property insurance in this state, 995
while achieving efficiencies and economies, and while providing 996
service to policyholders, applicants, and agents which is no 997
less than the quality generally provided in the voluntary 998
market, for the achievement of the foregoing public purposes. 999
Because it is essential for this government entity to have the 1000
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maximum financial resources to pay claims following a 1001
catastrophic hurricane, it is the intent of the Legislature that 1002
the corporation continue to be an integral part of the state and 1003
that the income of the corporation be exempt from federal income 1004
taxation and that interest on the debt obligations issued by the 1005
corporation be exempt from federal income taxation. 1006
2. The Residential Property and Casualty Joint 1007
Underwriting Association originally created by this statute 1008
shall be known as the Citizens Property Insurance Corporation. 1009
The corporation shall provide insurance for res idential and 1010
commercial property, for applicants who are entitled, but, in 1011
good faith, are unable to procure insurance through the 1012
voluntary market. The corporation shall operate pursuant to a 1013
plan of operation approved by order of the Financial Services 1014
Commission. The plan is subject to continuous review by the 1015
commission. The commission may, by order, withdraw approval of 1016
all or part of a plan if the commission determines that 1017
conditions have changed since approval was granted and that the 1018
purposes of the plan require changes in the plan. For the 1019
purposes of this subsection, residential coverage includes both 1020
personal lines residential coverage, which consists of the type 1021
of coverage provided by homeowner, mobile home owner, dwelling, 1022
tenant, condominium unit owner, and similar policies; and 1023
commercial lines residential coverage, which consists of the 1024
type of coverage provided by condominium association, apartment 1025
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building, and similar policies. 1026
3. Effective January 1, 2026, with respect to coverage for 1027
personal lines residential structures: 1028
a. Effective January 1, 2017, A structure that has a 1029
dwelling replacement cost of $700,000 or more, or a single 1030
condominium unit that has a combined dwelling and contents 1031
replacement cost of $700,000 or more, is not eligible for 1032
coverage by the corporation , except as otherwise provided in 1033
sub-subparagraph c. 1034
b. The requirements of sub -subparagraph a. do not apply in 1035
counties where the office determines there is not a reasonable 1036
degree of competition. In such counti es a personal lines 1037
residential structure that has a dwelling replacement cost of 1038
less than $1 million, or a single condominium unit that has a 1039
combined dwelling and contents replacement cost of less than $1 1040
million, is eligible for coverage by the corpora tion. 1041
c. The corporation shall make windstorm coverage available 1042
to any homeowner, including a condominium association, for any 1043
residential structure, including a mobile home that is used as a 1044
dwelling and that is tied down in compliance with mobile home 1045
tie-down requirements prescribed by the Department of Highway 1046
Safety and Motor Vehicles pursuant to s. 320.8325. The windstorm 1047
coverage must include coverage of the contents of the structure 1048
and may not depend on which property and casualty insurer is 1049
providing the property and casualty coverage for the structure 1050
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which is not windstorm coverage. This sub -subparagraph does not 1051
prohibit an insurer from issuing or renewing a policy that 1052
provides hurricane or windstorm coverage for a residential 1053
structure. 1054
(I) A homeowner may obtain a windstorm coverage quote from 1055
an agent that transacts property and casualty insurance. If the 1056
homeowner elects windstorm coverage by the corporation in 1057
addition to property and casualty coverage by an insurer other 1058
than the corporation, the windstorm portion of the quote shall 1059
be underwritten by the corporation and administered by the 1060
insurer chosen by the homeowner. If the homeowner elects only 1061
windstorm coverage, the corporation shall administer the policy. 1062
The administrator sh all handle windstorm claims, and, if the 1063
administrator is an insurer that is not the corporation, the 1064
administrator shall handle windstorm as well as nonwindstorm 1065
claims. Underwriting rules under this code apply to windstorm 1066
coverage by the corporation and may preclude the offering of 1067
windstorm coverage under limited circumstances prescribed by 1068
this code. 1069
(II) The windstorm premiums, adjusted by a standard 1070
formula prescribed by the corporation for administrative fees 1071
for the insurance agent and, if applic able, for the insurer 1072
other than the corporation, shall be passed on to the 1073
corporation. 1074
(III) The corporation shall pool the windstorm premiums 1075
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and shall use the pool as the primary source for settlement of 1076
windstorm claims submitted by the policyholder through the 1077
policyholder's administrator. Settlement payments shall be 1078
processed and distributed through the corporation or, if 1079
applicable, the homeowner's property and casualty insurer. If 1080
the corporation is not the administrator, the corporation shall 1081
pay claims administrative fees to the homeowner's property and 1082
casualty insurer. 1083
4. It is the intent of the Legislature that policyholders, 1084
applicants, and agents of the corporation receive service and 1085
treatment of the highest possible level but never les s than that 1086
generally provided in the voluntary market. It is also intended 1087
that the corporation be held to service standards no less than 1088
those applied to insurers in the voluntary market by the office 1089
with respect to responsiveness, timeliness, customer courtesy, 1090
and overall dealings with policyholders, applicants, or agents 1091
of the corporation. 1092
5.a. Effective July 1, 2025 January 1, 2009, a personal 1093
lines residential structure that is located in the "wind -borne 1094
debris region," as defined in s. 1609.2, I nternational Building 1095
Code (2006), and that has an insured value on the structure of 1096
$750,000 or more is not eligible for coverage by the 1097
corporation, except for windstorm coverage, unless the structure 1098
has opening protections as required under the Florida Building 1099
Code for a newly constructed residential structure in that area. 1100
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A residential structure is deemed to comply with this sub -1101
subparagraph if it has shutters or opening protections on all 1102
openings and if such opening protections complied with the 1103
Florida Building Code at the time they were installed. 1104
b. Any major structure, as defined in s. 161.54(6)(a), 1105
that is newly constructed, or rebuilt, repaired, restored, or 1106
remodeled to increase the total square footage of finished area 1107
by more than 25 perc ent, pursuant to a permit applied for after 1108
July 1, 2015, is not eligible for coverage by the corporation , 1109
except for windstorm coverage, if the structure is seaward of 1110
the coastal construction control line established pursuant to s. 1111
161.053 or is within t he Coastal Barrier Resources System as 1112
designated by 16 U.S.C. ss. 3501 -3510. 1113
6. Effective July 1, 2025, the corporation shall make 1114
windstorm coverage available to all commercial lines residential 1115
structures, including condominiums, regardless of whether the 1116
units are rented. The windstorm coverage must include coverage 1117
of the contents of the structure and may not depend on which 1118
property and casualty insurer is providing the property and 1119
casualty coverage for the structure which is not windstorm 1120
coverage. This subparagraph does not prohibit an insurer from 1121
issuing or renewing a windstorm or hurricane coverage policy for 1122
a residential structure. This subparagraph does not prohibit an 1123
insurer from issuing or renewing a policy that provides 1124
hurricane or windstorm coverage for a commercial lines 1125
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residential structure With respect to wind -only coverage for 1126
commercial lines residential condominiums, effective July 1, 1127
2014, a condominium shall be deemed ineligible for coverage if 1128
50 percent or more of the units a re rented more than eight times 1129
in a calendar year for a rental agreement period of less than 30 1130
days. 1131
(b)1. All insurers authorized to write one or more subject 1132
lines of business in this state are subject to assessment by the 1133
corporation and, for the pu rposes of this subsection, are 1134
referred to collectively as "assessable insurers." Insurers 1135
writing one or more subject lines of business in this state 1136
pursuant to part VIII of chapter 626 are not assessable 1137
insurers; however, insureds who procure one or mo re subject 1138
lines of business in this state pursuant to part VIII of chapter 1139
626 are subject to assessment by the corporation and are 1140
referred to collectively as "assessable insureds." An insurer's 1141
assessment liability begins on the first day of the calenda r 1142
year following the year in which the insurer was issued a 1143
certificate of authority to transact insurance for subject lines 1144
of business in this state and terminates 1 year after the end of 1145
the first calendar year during which the insurer no longer holds 1146
a certificate of authority to transact insurance for subject 1147
lines of business in this state. 1148
2. All revenues, assets, liabilities, losses, and expenses 1149
of the corporation shall be maintained in the Citizens account. 1150
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The Citizens account may provide: 1151
a. Personal residential policies that provide 1152
comprehensive, multiperil coverage on risks that are not located 1153
in areas eligible for coverage by the Florida Windstorm 1154
Underwriting Association as those areas were defined on January 1155
1, 2002, and for policies t hat do not provide coverage for the 1156
peril of wind on risks that are located in such areas ; 1157
b. Commercial residential and commercial nonresidential 1158
policies that provide coverage for basic property perils on 1159
risks that are not located in areas eligible fo r coverage by the 1160
Florida Windstorm Underwriting Association as those areas were 1161
defined on January 1, 2002 , and for policies that do not provide 1162
coverage for the peril of wind on risks that are located in such 1163
areas; and 1164
c. Personal residential policies and commercial 1165
residential and commercial nonresidential property policies that 1166
provide coverage for the peril of wind on risks that are located 1167
in areas eligible for coverage by the Florida Windstorm 1168
Underwriting Association as those areas were defined o n January 1169
1, 2002. The corporation may offer policies that provide 1170
multiperil coverage and shall offer policies that provide 1171
coverage only for the peril of wind for risks located in areas 1172
eligible for coverage by the Florida Windstorm Underwriting 1173
Association, as those areas were defined on January 1, 2002. The 1174
corporation may not offer new commercial residential policies 1175
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providing multiperil coverage but shall continue to offer 1176
commercial residential wind -only policies, and may offer 1177
commercial residential policies excluding wind . However, the 1178
corporation may continue to renew a commercial residential 1179
multiperil policy on a building that was insured by the 1180
corporation on July 1, 2025 June 30, 2014, under a multiperil 1181
policy. In issuing multiperil coverage u nder this sub-1182
subparagraph, the corporation may use its approved policy forms 1183
and rates for risks located in areas not eligible for coverage 1184
by the Florida Windstorm Underwriting Association, as those 1185
areas were defined on January 1, 2002, and for policies that do 1186
not provide coverage for the peril of wind on risks that are 1187
located in such areas. An applicant or insured who is eligible 1188
to purchase a multiperil policy from the corporation may 1189
purchase a multiperil policy from an authorized insurer without 1190
prejudice to the applicant's or insured's eligibility to 1191
prospectively purchase a policy that p rovides coverage only for 1192
the peril of wind from the corporation. An applicant or insured 1193
who is eligible for a corporation policy that provides coverage 1194
only for the peril of wind may elect to purchase or retain such 1195
policy and also purchase or retain cov erage excluding wind from 1196
an authorized insurer without prejudice to the applicant's or 1197
insured's eligibility to prospectively purchase a policy that 1198
provides multiperil coverage from the corporation. The following 1199
policies, which provide coverage only for the peril of wind, 1200
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must also include quota share primary insurance under 1201
subparagraph (c)2.: 1202
(I) Personal residential policies and commercial 1203
residential and commercial nonresidential property policies that 1204
provide coverage for the peril of wind on risk s that are located 1205
in areas eligible for coverage by the Florida Windstorm 1206
Underwriting Association, as those areas were defined on January 1207
1, 2002; 1208
(II) Policies that provide multiperil coverage, if offered 1209
by the corporation, and policies that provide coverage only for 1210
the peril of wind for risks located in areas eligible for 1211
coverage by the Florida Windstorm Underwriting Association, as 1212
those areas were defined on January 1, 2002; 1213
(III) Commercial residential wind -only policies; 1214
(IV) Commercial residential policies excluding wind, if 1215
offered by the corporation; and 1216
(V) Commercial residential multiperil policies on a 1217
building that was insured by the corporation on June 30, 2014. 1218
1219
The area eligible for coverage with the corporation under this 1220
sub-subparagraph includes the area within Port Canaveral, which 1221
is bordered on the south by the City of Cape Canaveral, bordered 1222
on the west by the Banana River, and bordered on the north by 1223
Federal Government property. 1224
3. With respect to a deficit in the C itizens account: 1225
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a. Upon a determination by the board of governors that the 1226
Citizens account has a projected deficit, the board shall levy a 1227
Citizens policyholder surcharge against all policyholders of the 1228
corporation. 1229
(I) The surcharge shall be levied as a uniform percentage 1230
of the premium for the policy of up to 15 percent of such 1231
premium, which funds shall be used to offset the deficit. 1232
(II) The surcharge is payable upon cancellation or 1233
termination of the policy, upon renewal of the policy, or upon 1234
issuance of a new policy by the corporation within the first 12 1235
months after the date of the levy or the period of time 1236
necessary to fully collect the surcharge amount. 1237
(III) The surcharge is not considered premium and is not 1238
subject to commissions, fee s, or premium taxes. However, failure 1239
to pay the surcharge shall be treated as failure to pay premium. 1240
b. After accounting for the Citizens policyholder 1241
surcharge imposed under sub -subparagraph a., the remaining 1242
projected deficits in the Citizens account in a particular 1243
calendar year shall be recovered through emergency assessments 1244
under sub-subparagraph c. 1245
c. Upon a determination by the board of governors that a 1246
projected deficit in the Citizens account exceeds the amount 1247
that is expected to be recover ed through surcharges, the board, 1248
after verification by the office, shall levy emergency 1249
assessments for as many years as necessary to cover the 1250
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deficits, to be collected by assessable insurers and the 1251
corporation and collected from assessable insureds upo n issuance 1252
or renewal of policies for subject lines of business, excluding 1253
National Flood Insurance Program policies. The amount collected 1254
in a particular year must be a uniform percentage of that year's 1255
direct written premium for subject lines of business and the 1256
Citizens account, excluding National Flood Insurance Program 1257
policy premiums, as annually determined by the board and 1258
verified by the office. The office shall verify the arithmetic 1259
calculations involved in the board's determination within 30 1260
days after receipt of the information on which the determination 1261
was based. The office shall notify assessable insurers and the 1262
Florida Surplus Lines Service Office of the date on which 1263
assessable insurers shall begin to collect and assessable 1264
insureds shall begin to pay such assessment. The date must be at 1265
least 90 days after the date the corporation levies emergency 1266
assessments pursuant to this sub -subparagraph. Notwithstanding 1267
any other law, the corporation and each assessable insurer that 1268
writes subject lines of business shall collect emergency 1269
assessments from its policyholders without such obligation being 1270
affected by any credit, limitation, exemption, or deferment. 1271
Emergency assessments levied by the corporation on assessable 1272
insureds shall be collected by the surplus lines agent at the 1273
time the surplus lines agent collects the surplus lines tax 1274
required by s. 626.932 and paid to the Florida Surplus Lines 1275
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Service Office at the time the surplus lines agent pays the 1276
surplus lines tax to that office. The emerg ency assessments 1277
collected shall be transferred directly to the corporation on a 1278
periodic basis as determined by the corporation and held by the 1279
corporation solely in the Citizens account. The aggregate amount 1280
of emergency assessments levied for the Citize ns account in any 1281
calendar year may be less than but may not exceed the greater of 1282
10 percent of the amount needed to cover the deficit, plus 1283
interest, fees, commissions, required reserves, and other costs 1284
associated with financing the original deficit, or 10 percent of 1285
the aggregate statewide direct written premium for subject lines 1286
of business and the Citizens account of the corporation for the 1287
prior year, plus interest, fees, commissions, required reserves, 1288
and other costs associated with financing the d eficit. 1289
d. The corporation may pledge the proceeds of assessments, 1290
projected recoveries from the Florida Hurricane Catastrophe 1291
Fund, other insurance and reinsurance recoverables, policyholder 1292
surcharges and other surcharges, and other funds available to 1293
the corporation as the source of revenue for and to secure bonds 1294
issued under paragraph (q), bonds or other indebtedness issued 1295
under subparagraph (c)2. (c)3., or lines of credit or other 1296
financing mechanisms issued or created under this subsection, or 1297
to retire any other debt incurred as a result of deficits or 1298
events giving rise to deficits, or in any other way that the 1299
board determines will efficiently recover such deficits. The 1300
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purpose of the lines of credit or other financing mechanisms is 1301
to provide additional resources to assist the corporation in 1302
covering claims and expenses attributable to a catastrophe. As 1303
used in this subsection, the term "assessments" includes 1304
emergency assessments under sub -subparagraph c. Emergency 1305
assessments collected under s ub-subparagraph c. are not part of 1306
an insurer's rates, are not premium, and are not subject to 1307
premium tax, fees, or commissions; however, failure to pay the 1308
emergency assessment shall be treated as failure to pay premium. 1309
The emergency assessments shall c ontinue as long as any bonds 1310
issued or other indebtedness incurred with respect to a deficit 1311
for which the assessment was imposed remain outstanding, unless 1312
adequate provision has been made for the payment of such bonds 1313
or other indebtedness pursuant to th e documents governing such 1314
bonds or indebtedness. 1315
e. As used in this subsection and for purposes of any 1316
deficit incurred on or after January 25, 2007 , the term "subject 1317
lines of business" means insurance written by assessable 1318
insurers or procured by asse ssable insureds for all property and 1319
casualty lines of business in this state, but not including 1320
workers' compensation or medical malpractice. As used in this 1321
sub-subparagraph, the term "property and casualty lines of 1322
business" includes all lines of busine ss identified on Form 2, 1323
Exhibit of Premiums and Losses, in the annual statement required 1324
of authorized insurers under s. 624.424 and any rule adopted 1325
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under this section, except for those lines identified as 1326
accident and health insurance and except for pol icies written 1327
under the National Flood Insurance Program or the Federal Crop 1328
Insurance Program. For purposes of this sub -subparagraph, the 1329
term "workers' compensation" includes both workers' compensation 1330
insurance and excess workers' compensation insurance . 1331
f. The Florida Surplus Lines Service Office shall annually 1332
determine the aggregate statewide written premium in subject 1333
lines of business procured by assessable insureds and report 1334
that information to the corporation in a form and at a time the 1335
corporation specifies to ensure that the corporation can meet 1336
the requirements of this subsection and the corporation's 1337
financing obligations. 1338
g. The Florida Surplus Lines Service Office shall verify 1339
the proper application by surplus lines agents of assessment 1340
percentages for emergency assessments levied under this 1341
subparagraph on assessable insureds and assist the corporation 1342
in ensuring the accurate, timely collection and payment of 1343
assessments by surplus lines agents as required by the 1344
corporation. 1345
h. If the amount of any assessments or surcharges 1346
collected from corporation policyholders, assessable insurers or 1347
their policyholders, or assessable insureds exceeds the amount 1348
of the deficits, such excess amounts shall be remitted to and 1349
retained by the corporat ion in a reserve to be used by the 1350
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corporation, as determined by the board of governors and 1351
approved by the office, to pay claims or reduce any past, 1352
present, or future plan -year deficits or to reduce outstanding 1353
debt. 1354
(c) The corporation's plan of opera tion: 1355
1. Must provide for adoption of residential property and 1356
casualty insurance policy forms and commercial residential and 1357
nonresidential property insurance forms, which must be approved 1358
by the office before use. The corporation shall adopt the 1359
following policy forms: 1360
a. Standard personal lines policy forms that are 1361
comprehensive multiperil policies providing full coverage of a 1362
residential property equivalent to the coverage provided in the 1363
private insurance market under an HO -3, HO-4, or HO-6 policy. 1364
b. Basic personal lines policy forms that are policies 1365
similar to an HO-8 policy or a dwelling fire policy that provide 1366
coverage meeting the requirements of the secondary mortgage 1367
market, but which is more limited than the coverage under a 1368
standard policy. 1369
c. Commercial lines residential and nonresidential policy 1370
forms that are generally similar to the basic perils of full 1371
coverage obtainable for commercial residential structures and 1372
commercial nonresidential structures in the admitted voluntary 1373
market. 1374
d. Personal lines and commercial lines residential 1375
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property insurance forms that cover the peril of wind only. The 1376
forms are applicable only to residential properties located in 1377
areas eligible for coverage by the Florida Windstorm 1378
Underwriting Associa tion, as those areas were defined on January 1379
1, 2002. 1380
e. Commercial lines nonresidential property insurance 1381
forms that cover the peril of wind only. The forms are 1382
applicable only to nonresidential properties located in areas 1383
eligible for coverage by the Florida Windstorm Underwriting 1384
Association, as those areas were defined on January 1, 2002. 1385
f. The corporation may adopt variations of the policy 1386
forms listed in sub-subparagraphs a.-e. which contain more 1387
restrictive coverage. 1388
g. The corporation shall offer a basic personal lines 1389
policy similar to an HO -8 policy with dwelling repair based on 1390
common construction materials and methods. 1391
2. Must provide that the corporation adopt a program in 1392
which the corporation and authorized insurers enter into quota 1393
share primary insurance agreements for hurricane coverage, as 1394
defined in s. 627.4025(2)(a), for eligible risks, and adopt 1395
property insurance forms for eligible risks which cover the 1396
peril of wind only. 1397
a. As used in this subsection, the term: 1398
(I) "Approved surplus lines insurer" means an eligible 1399
surplus lines insurer that: 1400
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(A) Has a financial strength rating of "A -" or higher from 1401
A.M. Best Company; 1402
(B) Has a personal lines residential risk program that is 1403
managed by a Florida resident surplus lines broker; 1404
(C) Applies to the office to participate in the take -out 1405
process to offer coverage to applicants for new coverage from 1406
the corporation or current policyholders of the corporation 1407
through a take-out plan approved by the office; 1408
(D) Does not, as part of any take -out plan approved by the 1409
office, offer coverage on any personal lines residential risk 1410
that is a primary residence or has a homestead exemption under 1411
chapter 196; 1412
(E) Files rates for review as part of a take -out plan with 1413
the office. The office shall review whether the premium is more 1414
than 20 percent greater than the premium for comparable coverage 1415
from the corporation; and 1416
(F) Provides data to the office related to coverage and 1417
rates in a format promulgated by the commission. 1418
(II) "Eligible risks" means personal lines residential and 1419
commercial lines residential risks that meet the underwriting 1420
criteria of the corporation and are located in areas that were 1421
eligible for coverage by the Florida Windstorm Underwriting 1422
Association on January 1, 2002. 1423
(III) "Primary residence" means the dwelling that is the 1424
policyholder's primary home or is a rental property that is the 1425
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primary home of the tenant, and which the policyholder or tenant 1426
occupies for more than 9 months of each year. 1427
(IV) "Quota share primary insurance" means an arrangement 1428
in which the primary hurricane coverage of an eligible risk is 1429
provided in specified percentages by the corporation and an 1430
authorized insurer. The corporation and authorized insurer are 1431
each solely responsible for a specified percentage of hurricane 1432
coverage of an eligible risk as set forth in a quota share 1433
primary insurance agreement between the corporation and an 1434
authorized insurer and the insurance contract. The 1435
responsibility of the corporation or authorized insurer to pay 1436
its specified percentage of hurricane losses of an eligible 1437
risk, as set forth in the agreement, may not be altered by the 1438
inability of the other party to pay its specified percentage of 1439
losses. Eligible risks that are provided h urricane coverage 1440
through a quota share primary insurance arrangement must be 1441
provided policy forms that set forth the obligations of the 1442
corporation and authorized insurer under the arrangement, 1443
clearly specify the percentages of quota share primary insur ance 1444
provided by the corporation and authorized insurer, and 1445
conspicuously and clearly state that the authorized insurer and 1446
the corporation may not be held responsible beyond their 1447
specified percentage of coverage of hurricane losses. 1448
b. The corporation may enter into quota share primary 1449
insurance agreements with authorized insurers at corporation 1450
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coverage levels of 90 percent and 50 percent. 1451
c. If the corporation determines that additional coverage 1452
levels are necessary to maximize participation in quo ta share 1453
primary insurance agreements by authorized insurers, the 1454
corporation may establish additional coverage levels. However, 1455
the corporation's quota share primary insurance coverage level 1456
may not exceed 90 percent. 1457
d. Any quota share primary insuranc e agreement entered 1458
into between an authorized insurer and the corporation must 1459
provide for a uniform specified percentage of coverage of 1460
hurricane losses, by county or territory as set forth by the 1461
corporation board, for all eligible risks of the authoriz ed 1462
insurer covered under the agreement. 1463
e. Any quota share primary insurance agreement entered 1464
into between an authorized insurer and the corporation is 1465
subject to review and approval by the office. However, such 1466
agreement shall be authorized only as to insurance contracts 1467
entered into between an authorized insurer and an insured who is 1468
already insured by the corporation for wind coverage. 1469
f. For all eligible risks covered under quota share 1470
primary insurance agreements, the exposure and coverage levels 1471
for both the corporation and authorized insurers shall be 1472
reported by the corporation to the Florida Hurricane Catastrophe 1473
Fund. For all policies of eligible risks covered under such 1474
agreements, the corporation and the authorized insurer must 1475
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maintain complete and accurate records for the purpose of 1476
exposure and loss reimbursement audits as required by fund 1477
rules. The corporation and the authorized insurer shall each 1478
maintain duplicate copies of policy declaration pages and 1479
supporting claims documents. 1480
g. The corporation board shall establish in its plan of 1481
operation standards for quota share agreements which ensure that 1482
there is no discriminatory application among insurers as to the 1483
terms of the agreements, pricing of the agreements, incentive 1484
provisions if any, and consideration paid for servicing policies 1485
or adjusting claims. 1486
h. The quota share primary insurance agreement between the 1487
corporation and an authorized insurer must set forth the 1488
specific terms under which coverage is provided, including, but 1489
not limited to, the sale and servicing of policies issued under 1490
the agreement by the insurance agent of the authorized insurer 1491
producing the business, the reporting of information concerning 1492
eligible risks, the payment of premium to the corporation, and 1493
arrangements for the adjustment and payment of hurricane claims 1494
incurred on eligible risks by the claims adjuster and personnel 1495
of the authorized insurer. Entering into a quota sharing 1496
insurance agreement between the corporation and an authorized 1497
insurer is voluntary and at the discretion of the authorized 1498
insurer. 1499
2.3. May provide that the corporation may employ or 1500
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otherwise contract with individuals or other entities to provide 1501
administrative or professional services that may be appropriate 1502
to effectuate the plan. The corporation may borrow funds by 1503
issuing bonds or by incurring other indebtedness, and shall have 1504
other powers reasonably necessary to effectuate the requirements 1505
of this subsection, including, without limitation, the power to 1506
issue bonds and incur other indebtedness in order to refinance 1507
outstanding bonds or other indebtedness. The corporation may 1508
seek judicial validation of its bonds or other indebtedness 1509
under chapter 75. The corporation may issue bonds or incur other 1510
indebtedness, or have bonds issued on its behalf by a unit of 1511
local government pursuant to subparagraph (q)2. in the absence 1512
of a hurricane or other weather -related event, upon a 1513
determination by the corporation, subject to approval by the 1514
office, that such action would enable it to efficiently meet the 1515
financial obligations of the corporation and that such 1516
financings are reasonably necessary to effectuate the 1517
requirements of this subsection. The corporation may take all 1518
actions needed to facilitate tax -free status for such bond s or 1519
indebtedness, including formation of trusts or other affiliated 1520
entities. The corporation may pledge assessments, projected 1521
recoveries from the Florida Hurricane Catastrophe Fund, other 1522
reinsurance recoverables, policyholder surcharges and other 1523
surcharges, and other funds available to the corporation as 1524
security for bonds or other indebtedness. In recognition of s. 1525
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10, Art. I of the State Constitution, prohibiting the impairment 1526
of obligations of contracts, it is the intent of the Legislature 1527
that no action be taken whose purpose is to impair any bond 1528
indenture or financing agreement or any revenue source committed 1529
by contract to such bond or other indebtedness. 1530
3.4. Must require that the corporation operate subject to 1531
the supervision and approval of a board of governors consisting 1532
of nine individuals who are residents of this state and who are 1533
from different geographical areas of the state, one of whom is 1534
appointed by the Governor and serves solely to advocate on 1535
behalf of the consumer. The appointme nt of a consumer 1536
representative by the Governor is deemed to be within the scope 1537
of the exemption provided in s. 112.313(7)(b) and is in addition 1538
to the appointments authorized under sub -subparagraph a. 1539
a. The Governor, the Chief Financial Officer, the 1540
President of the Senate, and the Speaker of the House of 1541
Representatives shall each appoint two members of the board. At 1542
least one of the two members appointed by each appointing 1543
officer must have demonstrated expertise in insurance and be 1544
deemed to be within the scope of the exemption provided in s. 1545
112.313(7)(b). The Chief Financial Officer shall designate one 1546
of the appointees as chair. All board members serve at the 1547
pleasure of the appointing officer. All members of the board are 1548
subject to removal at wi ll by the officers who appointed them. 1549
All board members, including the chair, must be appointed to 1550
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serve for 3-year terms beginning annually on a date designated 1551
by the plan. However, for the first term beginning on or after 1552
July 1, 2009, each appointing officer shall appoint one member 1553
of the board for a 2 -year term and one member for a 3 -year term. 1554
A board vacancy shall be filled for the unexpired term by the 1555
appointing officer. The Chief Financial Officer shall appoint a 1556
technical advisory group to prov ide information and advice to 1557
the board in connection with the board's duties under this 1558
subsection. The executive director and senior managers of the 1559
corporation shall be engaged by the board and serve at the 1560
pleasure of the board. Any executive director appointed on or 1561
after July 1, 2006, is subject to confirmation by the Senate. 1562
The executive director is responsible for employing other staff 1563
as the corporation may require, subject to review and 1564
concurrence by the board. 1565
b. The board shall create a Mark et Accountability Advisory 1566
Committee to assist the corporation in developing awareness of 1567
its rates and its customer and agent service levels in 1568
relationship to the voluntary market insurers writing similar 1569
coverage. 1570
(I) The members of the advisory commi ttee consist of the 1571
following 11 persons, one of whom must be elected chair by the 1572
members of the committee: four representatives, one appointed by 1573
the Florida Association of Insurance Agents, one by the Florida 1574
Association of Insurance and Financial Advis ors, one by the 1575
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Professional Insurance Agents of Florida, and one by the Latin 1576
American Association of Insurance Agencies; three 1577
representatives appointed by the insurers with the three highest 1578
voluntary market share of residential property insurance 1579
business in the state; one representative from the Office of 1580
Insurance Regulation; one consumer appointed by the board who is 1581
insured by the corporation at the time of appointment to the 1582
committee; one representative appointed by the Florida 1583
Association of Realtors; and one representative appointed by the 1584
Florida Bankers Association. All members shall be appointed to 1585
3-year terms and may serve for consecutive terms. 1586
(II) The committee shall report to the corporation at each 1587
board meeting on insurance market is sues which may include rates 1588
and rate competition with the voluntary market; service, 1589
including policy issuance, claims processing, and general 1590
responsiveness to policyholders, applicants, and agents; and 1591
matters relating to depopulation. 1592
4.5. Must provide a procedure for determining the 1593
eligibility of a risk for coverage, as follows: 1594
a. Subject to s. 627.3517, with respect to personal lines 1595
residential risks that are primary residences, if the risk is 1596
offered coverage from an authorized insurer at the insurer's 1597
approved rate under a standard policy excluding including wind 1598
coverage or, if consistent with the insurer's underwriting rules 1599
as filed with the office, a basic policy excluding including 1600
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wind coverage, for a new application to the corporation f or 1601
coverage, the risk is not eligible for any policy issued by the 1602
corporation unless the premium for coverage from the authorized 1603
insurer is more than 20 percent greater than the premium for 1604
comparable coverage from the corporation. Whenever an offer of 1605
coverage for a personal lines residential risk that is a primary 1606
residence is received for a policyholder of the corporation at 1607
renewal from an authorized insurer, if the offer is equal to or 1608
less than the corporation's renewal premium for comparable 1609
coverage, the risk is not eligible for coverage with the 1610
corporation for policies that renew before April 1, 2023; for 1611
policies that renew on or after that date, the risk is not 1612
eligible for coverage with the corporation unless the premium 1613
for coverage from the authorized insurer is more than 20 percent 1614
greater than the corporation's renewal premium for comparable 1615
coverage. If the risk is not able to obtain such offer, the risk 1616
is eligible for a standard policy including wind coverage or a 1617
basic policy including wind coverage issued by the corporation ; 1618
however, if the risk could not be insured under a standard 1619
policy including wind coverage regardless of market conditions, 1620
the risk is eligible for a basic policy including wind coverage 1621
unless rejected under subpar agraph 8. The corporation shall 1622
determine the type of policy to be provided on the basis of 1623
objective standards specified in the underwriting manual and 1624
based on generally accepted underwriting practices. A 1625
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policyholder removed from the corporation through an assumption 1626
agreement does not remain eligible for coverage from the 1627
corporation after the end of the policy term . However, any 1628
policy removed from the corporation through an assumption 1629
agreement remains on the corporation's policy forms through the 1630
end of the policy term. This sub -subparagraph applies only to 1631
risks that are primary residences. 1632
(I) If the risk accepts an offer of coverage through the 1633
market assistance plan or through a mechanism established by the 1634
corporation other than a plan establis hed by s. 627.3518, before 1635
a policy is issued to the risk by the corporation or during the 1636
first 30 days of coverage by the corporation, and the producing 1637
agent who submitted the application to the plan or to the 1638
corporation is not currently appointed by t he insurer, the 1639
insurer shall: 1640
(A) Pay to the producing agent of record of the policy for 1641
the first year, an amount that is the greater of the insurer's 1642
usual and customary commission for the type of policy written or 1643
a fee equal to the usual and customa ry commission of the 1644
corporation; or 1645
(B) Offer to allow the producing agent of record of the 1646
policy to continue servicing the policy for at least 1 year and 1647
offer to pay the agent the greater of the insurer's or the 1648
corporation's usual and customary comm ission for the type of 1649
policy written. 1650
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1651
If the producing agent is unwilling or unable to accept 1652
appointment, the new insurer shall pay the agent in accordance 1653
with sub-sub-sub-subparagraph (A). 1654
(II) If the corporation enters into a contractual 1655
agreement for a take-out plan, the producing agent of record of 1656
the corporation policy is entitled to retain any unearned 1657
commission on the policy, and the insurer shall: 1658
(A) Pay to the producing agent of record, for the first 1659
year, an amount that is the greater of the insurer's usual and 1660
customary commission for the type of policy written or a fee 1661
equal to the usual and customary commission of the corporation; 1662
or 1663
(B) Offer to allow the producing agent of record to 1664
continue servicing the policy for at least 1 ye ar and offer to 1665
pay the agent the greater of the insurer's or the corporation's 1666
usual and customary commission for the type of policy written. 1667
1668
If the producing agent is unwilling or unable to accept 1669
appointment, the new insurer shall pay the agent in acco rdance 1670
with sub-sub-sub-subparagraph (A). 1671
b. Subject to s. 627.3517, with respect to personal lines 1672
residential risks that are not primary residences, if the risk 1673
is offered coverage from an authorized insurer at the insurer's 1674
approved rate or from an ap proved surplus lines insurer at the 1675
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rate approved by the office as part of such surplus lines 1676
insurer's take-out plan for a new application to the corporation 1677
for coverage, the risk is not eligible for any policy issued by 1678
the corporation unless the premiu m for coverage from the 1679
authorized insurer or approved surplus lines insurer is more 1680
than 20 percent greater than the premium for comparable coverage 1681
from the corporation. Whenever an offer of coverage for a 1682
personal lines residential risk that is not a pr imary residence 1683
is received for a policyholder of the corporation at renewal 1684
from an authorized insurer at the insurer's approved rate or an 1685
approved surplus lines insurer at the rate approved by the 1686
office as part of such insurer's take -out plan, the risk is not 1687
eligible for coverage with the corporation unless the premium 1688
for coverage from the authorized insurer or approved surplus 1689
lines insurer is more than 20 percent greater than the 1690
corporation's renewal premium for comparable coverage for 1691
policies that renew on or after July 1, 2024. If the risk is not 1692
able to obtain such offer, the risk is eligible for a standard 1693
policy including wind coverage or a basic policy including wind 1694
coverage issued by the corporation. If the risk could not be 1695
insured under a standard policy including wind coverage 1696
regardless of market conditions, the risk is eligible for a 1697
basic policy including wind coverage unless rejected under 1698
subparagraph 7 8. The corporation shall determine the type of 1699
policy to be provided on the basis of objective standards 1700
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specified in the underwriting manual and based on generally 1701
accepted underwriting practices. A policyholder removed from the 1702
corporation through an assu mption agreement does not remain 1703
eligible for coverage from the corporation after the end of the 1704
policy term. However, any policy removed from the corporation 1705
through an assumption agreement remains on the corporation's 1706
policy forms through the end of the policy term. 1707
(I) If the risk accepts an offer of coverage through the 1708
market assistance plan or through a mechanism established by the 1709
corporation other than a plan established by s. 627.3518, before 1710
a policy is issued to the risk by the corporation or d uring the 1711
first 30 days of coverage by the corporation, and the producing 1712
agent who submitted the application to the plan or to the 1713
corporation is not currently appointed by the insurer, the 1714
insurer must: 1715
(A) Pay to the producing agent of record of the p olicy, 1716
for the first year, an amount that is the greater of the 1717
insurer's usual and customary commission for the type of policy 1718
written or a fee equal to the usual and customary commission of 1719
the corporation; or 1720
(B) Offer to allow the producing agent of record of the 1721
policy to continue servicing the policy for at least 1 year and 1722
offer to pay the agent the greater of the insurer's or the 1723
corporation's usual and customary commission for the type of 1724
policy written. 1725
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1726
If the producing agent is unwilling or un able to accept 1727
appointment, the new insurer must pay the agent in accordance 1728
with sub-sub-sub-subparagraph (A). 1729
(II) If the corporation enters into a contractual 1730
agreement for a take -out plan, the producing agent of record of 1731
the corporation policy is en titled to retain any unearned 1732
commission on the policy, and the insurer must: 1733
(A) Pay to the producing agent of record, for the first 1734
year, an amount that is the greater of the insurer's usual and 1735
customary commission for the type of policy written or a fee 1736
equal to the usual and customary commission of the corporation; 1737
or 1738
(B) Offer to allow the producing agent of record to 1739
continue servicing the policy for at least 1 year and offer to 1740
pay the agent the greater of the insurer's or the corporation's 1741
usual and customary commission for the type of policy written. 1742
1743
If the producing agent is unwilling or unable to accept 1744
appointment, the new insurer shall pay the agent in accordance 1745
with sub-sub-sub-subparagraph (A). 1746
c. With respect to commercial lines resi dential risks, for 1747
a new application to the corporation for coverage, if the risk 1748
is offered coverage under a policy including wind coverage from 1749
an authorized insurer at its approved rate, the risk is not 1750
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eligible for a policy issued by the corporation un less the 1751
premium for coverage from the authorized insurer is more than 20 1752
percent greater than the premium for comparable coverage from 1753
the corporation. Whenever an offer of coverage for a commercial 1754
lines residential risk is received for a policyholder of the 1755
corporation at renewal from an authorized insurer, the risk is 1756
not eligible for coverage with the corporation unless the 1757
premium for coverage from the authorized insurer is more than 20 1758
percent greater than the corporation's renewal premium for 1759
comparable coverage. If the risk is not able to obtain any such 1760
offer, the risk is eligible for a policy including wind coverage 1761
issued by the corporation. A policyholder removed from the 1762
corporation through an assumption agreement remains eligible for 1763
coverage from the corporation until the end of the policy term. 1764
However, any policy removed from the corporation through an 1765
assumption agreement remains on the corporation's policy forms 1766
through the end of the policy term. 1767
(I) If the risk accepts an offer of cove rage through the 1768
market assistance plan or through a mechanism established by the 1769
corporation other than a plan established by s. 627.3518, before 1770
a policy is issued to the risk by the corporation or during the 1771
first 30 days of coverage by the corporation, and the producing 1772
agent who submitted the application to the plan or the 1773
corporation is not currently appointed by the insurer, the 1774
insurer shall: 1775
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(A) Pay to the producing agent of record of the policy, 1776
for the first year, an amount that is the greater of the 1777
insurer's usual and customary commission for the type of policy 1778
written or a fee equal to the usual and customary commission of 1779
the corporation; or 1780
(B) Offer to allow the producing agent of record of the 1781
policy to continue servicing the policy for at least 1 year and 1782
offer to pay the agent the greater of the insurer's or the 1783
corporation's usual and customary commission for the type of 1784
policy written. 1785
1786
If the producing agent is unwilling or unable to accept 1787
appointment, the new insurer shall pay the agent in accordance 1788
with sub-sub-sub-subparagraph (A). 1789
(II) If the corporation enters into a contractual 1790
agreement for a take -out plan, the producing agent of record of 1791
the corporation policy is entitled to retain any unearned 1792
commission on the policy, and the insurer shall: 1793
(A) Pay to the producing agent of record, for the first 1794
year, an amount that is the greater of the insurer's usual and 1795
customary commission for the type of policy written or a fee 1796
equal to the usual and customary commission of the corporation; 1797
or 1798
(B) Offer to allow the producing agent of record to 1799
continue servicing the policy for at least 1 year and offer to 1800
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pay the agent the greater of the insurer's or the corporation's 1801
usual and customary commission for the type of policy writt en. 1802
1803
If the producing agent is unwilling or unable to accept 1804
appointment, the new insurer shall pay the agent in accordance 1805
with sub-sub-sub-subparagraph (A). 1806
d. For purposes of determining comparable coverage under 1807
sub-subparagraphs a., b., and c., the comparison must be based 1808
on those forms and coverages that are reasonably comparable. The 1809
corporation may rely on a determination of comparable coverage 1810
and premium made by the producing agent who submits the 1811
application to the corporation, made in the age nt's capacity as 1812
the corporation's agent. For purposes of comparing the premium 1813
for comparable coverage under sub -subparagraphs a., b., and c., 1814
premium includes any surcharge or assessment that is actually 1815
applied to such policy. A comparison may be made s olely of the 1816
premium with respect to the main building or structure only on 1817
the following basis: the same Coverage A or other building 1818
limits; the same percentage hurricane deductible that applies on 1819
an annual basis or that applies to each hurricane for co mmercial 1820
residential property; the same percentage of ordinance and law 1821
coverage, if the same limit is offered by both the corporation 1822
and the authorized insurer or the approved surplus lines 1823
insurer; the same mitigation credits, to the extent the same 1824
types of credits are offered both by the corporation and the 1825
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authorized insurer or the approved surplus lines insurer; the 1826
same method for loss payment, such as replacement cost or actual 1827
cash value, if the same method is offered both by the 1828
corporation and the authorized insurer in accordance with 1829
underwriting rules; and any other form or coverage that is 1830
reasonably comparable as determined by the board. If an 1831
application is submitted to the corporation for wind -only 1832
coverage on a risk that is located in an a rea eligible for 1833
coverage by the Florida Windstorm Underwriting Association, as 1834
that area was defined on January 1, 2002, the premium for the 1835
corporation's wind-only policy plus the premium for the ex -wind 1836
policy that is offered by an authorized insurer to the applicant 1837
must be compared to the premium for multiperil coverage offered 1838
by an authorized insurer, subject to the standards for 1839
comparison specified in this subparagraph. If the corporation or 1840
the applicant requests from the authorized insurer or the 1841
approved surplus lines insurer a breakdown of the premium of the 1842
offer by types of coverage so that a comparison may be made by 1843
the corporation or its agent and the authorized insurer or the 1844
approved surplus lines insurer refuses or is unable to provide 1845
such information, the corporation may treat the offer as not 1846
being an offer of coverage from an authorized insurer at the 1847
insurer's approved rate. 1848
5.6. Must include rules for classifications of risks and 1849
rates. 1850
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6.7. Must provide that if premium and inve stment income 1851
for the Citizens account, which are attributable to a particular 1852
calendar year, are in excess of projected losses and expenses 1853
for the Citizens account attributable to that year, such excess 1854
shall be held in surplus in the Citizens account. S uch surplus 1855
must be available to defray deficits in the Citizens account as 1856
to future years and used for that purpose before assessing 1857
assessable insurers and assessable insureds as to any calendar 1858
year. 1859
7.8. Must provide objective criteria and procedures to be 1860
uniformly applied to all applicants in determining whether an 1861
individual risk is so hazardous as to be uninsurable. In making 1862
this determination and in establishing the criteria and 1863
procedures, the following must be considered: 1864
a. Whether the likelihood of a loss for the individual 1865
risk is substantially higher than for other risks of the same 1866
class; and 1867
b. Whether the uncertainty associated with the individual 1868
risk is such that an appropriate premiu m cannot be determined. 1869
1870
The acceptance or rejection of a risk by the corporation shall 1871
be construed as the private placement of insurance, and the 1872
provisions of chapter 120 do not apply. 1873
8.9. Must provide that the corporation make its best 1874
efforts to procure catastrophe reinsurance at reasonable rates, 1875
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to cover its projected 100 -year probable maximum loss as 1876
determined by the board of governors. If catastrophe reinsurance 1877
is not available at reasonable rates, the corporation need not 1878
purchase it, but the corporation shall include the costs of 1879
reinsurance to cover its projected 100 -year probable maximum 1880
loss in its rate calculations even if it does not purchase 1881
catastrophe reinsurance. 1882
9.10. Must provide in the policies issued by the 1883
corporation must provide that if the corporation or the market 1884
assistance plan obtains an offer from an authorized insurer to 1885
cover the risk at its approved rates, the risk is no longer 1886
eligible for renewal through the corporation, except for a 1887
hurricane or windstorm risk and except as otherwise provided in 1888
this subsection. 1889
10.11. Must include in the corporation policies and 1890
applications must include a notice that the corporation policy 1891
could, under this section, be replaced with a policy issued by 1892
an authorized insurer whic h does not provide coverage identical 1893
to the coverage provided by the corporation. The notice must 1894
also specify that acceptance of corporation coverage creates a 1895
conclusive presumption that the applicant or policyholder is 1896
aware of this potential. This subparagraph does not apply to a 1897
hurricane or windstorm coverage. 1898
11.12. May establish, subject to approval by the office, 1899
different eligibility requirements and operational procedures 1900
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for any line or type of coverage for any specified county or 1901
area if the board determines that such changes are justified due 1902
to the voluntary market being sufficiently stable and 1903
competitive in such area or for such line or type of coverage 1904
and that consumers who, in good faith, are unable to obtain 1905
insurance through the volu ntary market through ordinary methods 1906
continue to have access to coverage from the corporation. If 1907
coverage is sought in connection with a real property transfer, 1908
the requirements and procedures may not provide an effective 1909
date of coverage later than the date of the closing of the 1910
transfer as established by the transferor, the transferee, and, 1911
if applicable, the lender. This subparagraph does not apply to a 1912
hurricane or windstorm coverage. 1913
12.13. Must provide that the corporation appoint as its 1914
licensed agents only those agents who throughout such 1915
appointments also hold an appointment as defined in s. 626.015 1916
by at least three insurers who are authorized to write and are 1917
actually writing or renewing personal lines residential property 1918
coverage, commercial residential property coverage, or 1919
commercial nonresidential property coverage within the state. 1920
13.14. Must provide a premium payment plan option to its 1921
policyholders which, at a minimum, allows for quarterly and 1922
semiannual payment of premiums. A monthl y payment plan may, but 1923
is not required to, be offered. 1924
14.15. Must limit coverage on mobile homes or manufactured 1925
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homes built before 1994 to actual cash value of the dwelling 1926
rather than replacement costs of the dwelling. 1927
15.16. Must provide coverage for manufactured or mobile 1928
home dwellings. Such coverage must also include the following 1929
attached structures: 1930
a. Screened enclosures that are aluminum framed or 1931
screened enclosures that are not covered by the same or 1932
substantially the same materials as t hose of the primary 1933
dwelling; 1934
b. Carports that are aluminum or carports that are not 1935
covered by the same or substantially the same materials as those 1936
of the primary dwelling; and 1937
c. Patios that have a roof covering that is constructed of 1938
materials that are not the same or substantially the same 1939
materials as those of the primary dwelling. 1940
1941
The corporation shall make available a policy for mobile homes 1942
or manufactured homes for a minimum insured value of at least 1943
$3,000. 1944
16.17. May provide such limits o f coverage as the board 1945
determines, consistent with the requirements of this subsection. 1946
17.18. May require commercial property to meet specified 1947
hurricane mitigation construction features as a condition of 1948
eligibility for coverage. 1949
18.19. Must provide that new or renewal policies issued by 1950
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the corporation on or after January 1, 2012, which cover 1951
sinkhole loss do not include coverage for any loss to 1952
appurtenant structures, driveways, sidewalks, decks, or patios 1953
that are directly or indirectly caused by sinkhole activity. The 1954
corporation shall exclude such coverage using a notice of 1955
coverage change, which may be included with the policy renewal, 1956
and not by issuance of a notice of nonrenewal of the excluded 1957
coverage upon renewal of the current policy. 1958
19.a.20.a. Must require that the agent obtain from an 1959
applicant for coverage from the corporation an acknowledgment 1960
signed by the applicant, which includes, at a minimum, the 1961
following statement: 1962
ACKNOWLEDGMENT OF POTENTIAL SURCHARGE 1963
AND ASSESSMENT LIABILITY : 1964
1. AS A POLICYHOLDER OF CITIZENS PROPERTY INSURANCE 1965
CORPORATION, I UNDERSTAND THAT IF THE CORPORATION SUSTAINS 1966
A DEFICIT AS A RESULT OF HURRICANE LOSSES OR FOR ANY OTHER 1967
REASON, MY POLICY COULD BE SUBJECT TO SURCHARGES AND 1968
ASSESSMENTS, WHICH WILL BE DU E AND PAYABLE UPON RENEWAL, 1969
CANCELLATION, OR TERMINATION OF THE POLICY, AND THAT THE 1970
SURCHARGES AND ASSESSMENTS COULD BE AS HIGH AS 25 PERCENT 1971
OF MY PREMIUM, OR A DIFFERENT AMOUNT AS IMPOSED BY THE 1972
FLORIDA LEGISLATURE. 1973
2. I UNDERSTAND THAT I CAN AVOID TH E CITIZENS POLICYHOLDER 1974
SURCHARGE, WHICH COULD BE AS HIGH AS 15 PERCENT OF MY 1975
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PREMIUM, BY OBTAINING NONWINDSTORM COVERAGE FROM A PRIVATE 1976
MARKET INSURER AND THAT TO BE ELIGIBLE FOR COVERAGE BY 1977
CITIZENS, I MUST FIRST TRY TO OBTAIN PRIVATE MARKET 1978
COVERAGE BEFORE APPLYING FOR OR RENEWING COVERAGE WITH 1979
CITIZENS. I UNDERSTAND THAT PRIVATE MARKET INSURANCE RATES 1980
ARE REGULATED AND APPROVED BY THE STATE. 1981
3. I UNDERSTAND THAT I MAY BE SUBJECT TO EMERGENCY 1982
ASSESSMENTS TO THE SAME EXTENT AS POLICYHOLDERS OF OTHER 1983
INSURANCE COMPANIES, OR A DIFFERENT AMOUNT AS IMPOSED BY 1984
THE FLORIDA LEGISLATURE. 1985
4. I ALSO UNDERSTAND THAT CITIZENS PROPERTY INSURANCE 1986
CORPORATION IS NOT SUPPORTED BY THE FULL FAITH AND CREDIT 1987
OF THE STATE OF FLORIDA. 1988
b. The corporation shall maintain, in electronic format or 1989
otherwise, a copy of the applicant's signed acknowledgment and 1990
provide a copy of the statement to the policyholder as part of 1991
the first renewal after the effective date of sub -subparagraph 1992
a. 1993
c. The signed acknowledgment form crea tes a conclusive 1994
presumption that the policyholder understood and accepted his or 1995
her potential surcharge and assessment liability as a 1996
policyholder of the corporation. 1997
20.21. Must provide that the income of the corporation may 1998
not inure to the benefit o f any private person. 1999
(o) If coverage in the Citizens account is deactivated 2000
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pursuant to paragraph (p), coverage through the corporation 2001
shall be reactivated by order of the office only under one of 2002
the following circumstances: 2003
1. If the market assista nce plan receives a minimum of 100 2004
applications for coverage within a 3 -month period, or 200 2005
applications for coverage within a 1 -year period or less for 2006
residential coverage, unless the market assistance plan provides 2007
a quotation from authorized carriers at their approved rates for 2008
at least 90 percent of such applicants. Any market assistance 2009
plan application that is rejected because an individual risk is 2010
so hazardous as to be uninsurable using the criteria specified 2011
in subparagraph (c)7. (c)8. may not be included in the minimum 2012
percentage calculation provided herein. In the event that there 2013
is a legal or administrative challenge to a determination by the 2014
office that the conditions of this subparagraph have been met 2015
for eligibility for coverage in the corpo ration, any eligible 2016
risk may obtain coverage during the pendency of such challenge. 2017
2. In response to a state of emergency declared by the 2018
Governor under s. 252.36, the office may activate coverage by 2019
order for the period of the emergency upon a finding by the 2020
office that the emergency significantly affects the availability 2021
of residential property insurance. 2022
(v)1. Effective July 1, 2002, policies of the Residential 2023
Property and Casualty Joint Underwriting Association become 2024
policies of the corporation. All obligations, rights, assets and 2025
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liabilities of the association, including bonds, note and debt 2026
obligations, and the financing documents pertaining to them 2027
become those of the corporation as of July 1, 2002. The 2028
corporation is not required to issue end orsements or 2029
certificates of assumption to insureds during the remaining term 2030
of in-force transferred policies. 2031
2. Effective July 1, 2002, policies of the Florida 2032
Windstorm Underwriting Association are transferred to the 2033
corporation and become policies o f the corporation. All 2034
obligations, rights, assets, and liabilities of the association, 2035
including bonds, note and debt obligations, and the financing 2036
documents pertaining to them are transferred to and assumed by 2037
the corporation on July 1, 2002. The corpor ation is not required 2038
to issue endorsements or certificates of assumption to insureds 2039
during the remaining term of in -force transferred policies. 2040
3. The Florida Windstorm Underwriting Association and the 2041
Residential Property and Casualty Joint Underwriti ng Association 2042
shall take all actions necessary to further evidence the 2043
transfers and provide the documents and instruments of further 2044
assurance as may reasonably be requested by the corporation for 2045
that purpose. The corporation shall execute assumptions a nd 2046
instruments as the trustees or other parties to the financing 2047
documents of the Florida Windstorm Underwriting Association or 2048
the Residential Property and Casualty Joint Underwriting 2049
Association may reasonably request to further evidence the 2050
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transfers and assumptions, which transfers and assumptions, 2051
however, are effective on the date provided under this paragraph 2052
whether or not, and regardless of the date on which, the 2053
assumptions or instruments are executed by the corporation. 2054
4. Effective July 1, 200 2, a new applicant for property 2055
insurance coverage who would otherwise have been eligible for 2056
coverage in the Florida Windstorm Underwriting Association is 2057
eligible for coverage from the corporation as provided in this 2058
subsection. 2059
5. The transfer of all policies, obligations, rights, 2060
assets, and liabilities from the Florida Windstorm Underwriting 2061
Association to the corporation and the renaming of the 2062
Residential Property and Casualty Joint Underwriting Association 2063
as the corporation does not affect the co verage with respect to 2064
covered policies as defined in s. 215.555(2)(c) provided to 2065
these entities by the Florida Hurricane Catastrophe Fund. The 2066
coverage provided by the fund to the corporation shall 2067
constitute and operate as a full transfer of coverage fr om the 2068
Florida Windstorm Underwriting Association and Residential 2069
Property and Casualty Joint Underwriting Association to the 2070
corporation. 2071
(z) In enacting the provisions of this section, the 2072
Legislature recognizes that both the Florida Windstorm 2073
Underwriting Association and the Residential Property and 2074
Casualty Joint Underwriting Association have entered into 2075
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financing arrangements that obligate each entity to service its 2076
debts and maintain the capacity to repay funds secured under 2077
these financing arrange ments. It is the intent of the 2078
Legislature that nothing in this section be construed to 2079
compromise, diminish, or interfere with the rights of creditors 2080
under such financing arrangements. It is further the intent of 2081
the Legislature to preserve the obligatio ns of the Florida 2082
Windstorm Underwriting Association and Residential Property and 2083
Casualty Joint Underwriting Association with regard to 2084
outstanding financing arrangements, with such obligations 2085
passing entirely and unchanged to the corporation and, 2086
specifically, to the Citizens account. So long as any bonds, 2087
notes, indebtedness, or other financing obligations of the 2088
Florida Windstorm Underwriting Association or the Residential 2089
Property and Casualty Joint Underwriting Association are 2090
outstanding, under the terms of the financing documents 2091
pertaining to them, the governing board of the corporation shall 2092
have and shall exercise the authority to levy, charge, collect, 2093
and receive all premiums, assessments, surcharges, charges, 2094
revenues, and receipts that the as sociations had authority to 2095
levy, charge, collect, or receive under the provisions of 2096
subsection (2) and this subsection, respectively, as they 2097
existed on January 1, 2002, to provide moneys, without exercise 2098
of the authority provided by this subsection, in at least the 2099
amounts, and by the times, as would be provided under those 2100
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former provisions of subsection (2) or this subsection, 2101
respectively, so that the value, amount, and collectability of 2102
any assets, revenues, or revenue source pledged or committed to , 2103
or any lien thereon securing such outstanding bonds, notes, 2104
indebtedness, or other financing obligations will not be 2105
diminished, impaired, or adversely affected by the amendments 2106
made by this act and to permit compliance with all provisions of 2107
financing documents pertaining to such bonds, notes, 2108
indebtedness, or other financing obligations, or the security or 2109
credit enhancement for them, and any reference in this 2110
subsection to bonds, notes, indebtedness, financing obligations, 2111
or similar obligations, of t he corporation shall include like 2112
instruments or contracts of the Florida Windstorm Underwriting 2113
Association and the Residential Property and Casualty Joint 2114
Underwriting Association to the extent not inconsistent with the 2115
provisions of the financing docume nts pertaining to them. 2116
(ll)(nn) The corporation may share its claims data with 2117
the National Insurance Crime Bureau, provided that the National 2118
Insurance Crime Bureau agrees to maintain the confidentiality of 2119
such documents as otherwise provided for in paragraph (w) (x). 2120
(mm) As used in this subsection, the term: 2121
1. "Approved surplus lines insurer" means an eligible 2122
surplus lines insurer that: 2123
a. Has a financial strength rating of "A -" or higher from 2124
A.M. Best Company; 2125
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b. Has a personal lines residential risk program that is 2126
managed by a Florida resident surplus lines broker; 2127
c. Applies to the office to participate in the take -out 2128
process to offer coverage to applicants for new coverage from 2129
the corporation or current policyholders of the corporation 2130
through a take-out plan approved by the office; 2131
d. Does not, as part of any take -out plan approved by the 2132
office, offer coverage on any personal lines residential risk 2133
that is a primary residence or has a homestead exemption under 2134
chapter 196; 2135
e. Files rates for review as part of a take-out plan with 2136
the office. The office shall review whether the premium is more 2137
than 20 percent greater than the premium for comparable coverage 2138
from the corporation; and 2139
f. Provides data to the office related to coverage and 2140
rates in a format prom ulgated by the commission. 2141
2. "Primary residence" means the dwelling that is the 2142
policyholder's primary home or is a rental property that is the 2143
primary home of the tenant, and which the policyholder or tenant 2144
occupies for more than 9 months of each year . 2145
3. "Windstorm" means wind, wind gusts, gales, hail, rain, 2146
or tornadoes caused by or resulting from a named tropical storm, 2147
including a hurricane, which create direct physical loss or 2148
damage to property. 2149
4. "Windstorm coverage" is coverage for loss or damage 2150
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caused by the peril of windstorm during a named tropical storm, 2151
including coverage for damage to the interior of a building, or 2152
to property inside a building, caused by rain, snow, sleet, 2153
hail, sand, or dust if the direct force of the windstorm fir st 2154
damages the building, causing an opening through which rain, 2155
snow, sleet, hail, sand, or dust enters and causes damage. The 2156
coverage includes, but is not limited to, hurricane coverage. 2157
Section 2. Paragraph (c) of subsection (2) and paragraph 2158
(e) of subsection (4) of section 215.555, Florida Statutes, are 2159
amended to read: 2160
215.555 Florida Hurricane Catastrophe Fund. — 2161
(2) DEFINITIONS.—As used in this section: 2162
(c) "Covered policy" means any insurance policy covering 2163
residential property in this st ate, including, but not limited 2164
to, any homeowner, mobile home owner, farm owner, condominium 2165
association, condominium unit owner, tenant, or apartment 2166
building policy, or any other policy covering a residential 2167
structure or its contents issued by any auth orized insurer, 2168
including a commercial self -insurance fund holding a certificate 2169
of authority issued by the Office of Insurance Regulation under 2170
s. 624.462, the Citizens Property Insurance Corporation, and any 2171
joint underwriting association or similar enti ty created under 2172
law. The term "covered policy" includes any collateral 2173
protection insurance policy covering personal residences which 2174
protects both the borrower's and the lender's financial 2175
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interests, in an amount at least equal to the coverage amount 2176
for the dwelling in place under the lapsed homeowner's policy, 2177
the coverage amount that the homeowner has been notified of by 2178
the collateral protection insurer, or the coverage amount that 2179
the homeowner requests from the collateral protection insurer, 2180
if such collateral protection insurance policy can be accurately 2181
reported as required in subsection (5). Additionally, covered 2182
policies include policies covering the peril of wind removed 2183
from the Florida Residential Property and Casualty Joint 2184
Underwriting Association or from the Citizens Property Insurance 2185
Corporation, created under s. 627.351(5) s. 627.351(6), or from 2186
the Florida Windstorm Underwriting Association, created under s. 2187
627.351(2), by an authorized insurer under the terms and 2188
conditions of an execut ed assumption agreement between the 2189
authorized insurer and such association or Citizens Property 2190
Insurance Corporation. Each assumption agreement between the 2191
association and such authorized insurer and or Citizens Property 2192
Insurance Corporation must be app roved by the Office of 2193
Insurance Regulation before the effective date of the 2194
assumption, and the Office of Insurance Regulation must provide 2195
written notification to the board within 15 working days after 2196
such approval. The term "covered policy" does not in clude any 2197
policy that excludes wind coverage or hurricane coverage or any 2198
reinsurance agreement and does not include any policy otherwise 2199
meeting this definition which is issued by a surplus lines 2200
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insurer or a reinsurer. All commercial residential excess 2201
policies and all deductible buy -back policies that, based on 2202
sound actuarial principles, require individual ratemaking shall 2203
be excluded by rule if the actuarial soundness of the fund is 2204
not jeopardized. For this purpose, the term "excess policy" 2205
means a policy that provides insurance protection for large 2206
commercial property risks and that provides a layer of coverage 2207
above a primary layer insured by another insurer. 2208
(4) REIMBURSEMENT CONTRACTS. — 2209
(e)1. Except as provided in subparagraphs 2. and 3., the 2210
contract shall provide that if an insurer demonstrates to the 2211
board that it is likely to qualify for reimbursement under the 2212
contract, and demonstrates to the board that the immediate 2213
receipt of moneys from the board is likely to prevent the 2214
insurer from becoming insolvent, the board shall advance the 2215
insurer, at market interest rates, the amounts necessary to 2216
maintain the solvency of the insurer, up to 50 percent of the 2217
board's estimate of the reimbursement due the insurer. The 2218
insurer's reimbursement shal l be reduced by an amount equal to 2219
the amount of the advance and interest thereon. 2220
2. With respect only to an entity created under s. 2221
627.351, the contract shall also provide that the board may, 2222
upon application by such entity, advance to such entity, at 2223
market interest rates, up to 90 percent of the lesser of: 2224
a. The board's estimate of the amount of reimbursement due 2225
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to such entity; or 2226
b. The entity's share of the actual reimbursement premium 2227
paid for that contract year, multiplied by the currently 2228
available liquid assets of the fund. In order for the entity to 2229
qualify for an advance under this subparagraph, the entity must 2230
demonstrate to the board that the advance is essential to allow 2231
the entity to pay claims for a covered event and the board must 2232
determine that the fund's assets are sufficient and are 2233
sufficiently liquid to allow the board to make an advance to the 2234
entity and still fulfill the board's reimbursement obligations 2235
to other insurers. The entity's final reimbursement for any 2236
contract year in which an advance has been made under this 2237
subparagraph must be reduced by an amount equal to the amount of 2238
the advance and any interest on such advance. In order to 2239
determine what amounts, if any, are due the entity, the board 2240
may require the entity t o report its exposure and its losses at 2241
any time to determine retention levels and reimbursements 2242
payable. 2243
3. The contract shall also provide specifically and solely 2244
with respect to any limited apportionment company under s. 2245
627.351(2)(b)3. that the board may, upon application by such 2246
company, advance to such company the amount of the estimated 2247
reimbursement payable to such company as calculated pursuant to 2248
paragraph (d), at market interest rates, if the board determines 2249
that the fund's assets are suffici ent and are sufficiently 2250
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liquid to permit the board to make an advance to such company 2251
and at the same time fulfill its reimbursement obligations to 2252
the insurers that are participants in the fund. Such company's 2253
final reimbursement for any contract year in which an advance 2254
pursuant to this subparagraph has been made shall be reduced by 2255
an amount equal to the amount of the advance and interest 2256
thereon. In order to determine what amounts, if any, are due to 2257
such company, the board may require such company to report its 2258
exposure and its losses at such times as may be required to 2259
determine retention levels and loss reimbursements payable. 2260
Section 3. Paragraph (e) of subsection (1) and paragraph 2261
(d) of subsection (2) of section 215.5595, Florida Statutes, are 2262
amended to read: 2263
215.5595 Insurance Capital Build -Up Incentive Program. — 2264
(1) Upon entering the 2008 hurricane season, the 2265
Legislature finds that: 2266
(e) Appropriating state funds to be exchanged for surplus 2267
notes issued by residential property insurers , under conditions 2268
requiring the insurer to contribute additional private sector 2269
capital and to write a minimum level of premiums for residential 2270
hurricane coverage, is a valid and important public purpose. 2271
(2) The purpose of this section is to provide f unds in 2272
exchange for surplus notes to be issued by new or existing 2273
authorized residential property insurers under the Insurance 2274
Capital Build-Up Incentive Program administered by the State 2275
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Board of Administration, under the following conditions: 2276
(d) The insurer must commit to increase its writings of 2277
residential property insurance , including the peril of wind, and 2278
to meet a minimum writing ratio of net written premium to 2279
surplus of at least 1:1 for the first calendar year after 2280
receiving the state funds o r renegotiation of the surplus note, 2281
1.5:1 for the second calendar year, and 2:1 for the remaining 2282
term of the surplus note. Alternatively, the insurer must meet a 2283
minimum writing ratio of gross written premium to surplus of at 2284
least 3:1 for the first cale ndar year after receiving the state 2285
funds or renegotiation of the surplus note, 4.5:1 for the second 2286
calendar year, and 6:1 for the remaining term of the surplus 2287
note. The writing ratios shall be determined by the Office of 2288
Insurance Regulation and certifi ed quarterly to the board. For 2289
this purpose, the term "premium" means premium for residential 2290
property insurance in this state , including the peril of wind , 2291
and "surplus" means the new capital and surplus note of the 2292
insurer. An insurer that makes an initi al application after July 2293
1, 2008, must also commit to writing at least 15 percent of its 2294
net or gross written premium for new policies, not including 2295
renewal premiums, for policies taken out of Citizens Property 2296
Insurance Corporation, during each of the f irst 3 years after 2297
receiving the state funds in exchange for the surplus note, 2298
which shall be determined by the Office of Insurance Regulation 2299
and certified annually to the board. The insurer must also 2300
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commit to maintaining a level of surplus and reinsuran ce 2301
sufficient to cover in excess of its 1 -in-100 year probable 2302
maximum loss, as determined by a hurricane loss model accepted 2303
by the Florida Commission on Hurricane Loss Projection 2304
Methodology, which shall be determined by the Office of 2305
Insurance Regulation and certified annually to the board. If the 2306
board determines that the insurer has failed to meet any of the 2307
requirements of this paragraph during the term of the surplus 2308
note, the board may increase the interest rate, accelerate the 2309
repayment of interest and principal, or shorten the term of the 2310
surplus note, subject to approval by the Commissioner of 2311
Insurance of payments by the insurer of principal and interest 2312
as provided in paragraph (f). 2313
Section 4. Paragraph (w) of subsection (1) of section 2314
624.805, Florida Statutes, is amended to read: 2315
624.805 Hazardous insurer standards; office's evaluation 2316
and enforcement authority; immediate final order. — 2317
(1) In determining whether the continued operation of any 2318
authorized insurer transacting business in t his state may be 2319
deemed to be hazardous to its policyholders or creditors or to 2320
the general public, the office may consider, in the totality of 2321
the circumstances of such insurer, any of the following: 2322
(w) As to a residential property insurer, whether it has 2323
sufficient capital, surplus, and reinsurance to withstand 2324
significant weather events , including, but not limited to, 2325
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hurricanes. 2326
Section 5. Paragraph (j) of subsection (2) of section 2327
627.062, Florida Statutes, is amended to read: 2328
627.062 Rate standards.— 2329
(2) As to all such classes of insurance: 2330
(j) With respect to residential property insurance rate 2331
filings, the rate filing: 2332
1. Must account for mitigation measures undertaken by 2333
policyholders to reduce hurricane losses and windstorm losses if 2334
the insurer provides hurricane or windstorm coverage . 2335
2. May use a modeling indication that is the weighted or 2336
straight average of two or more hurricane loss projection models 2337
found by the Florida Commission on Hurricane Loss Projection 2338
Methodology to be accurate or reliable pursuant to s. 627.0628 2339
if the insurer provides hurricane or windstorm coverage . If an 2340
averaged model is used under this section, the same averaged 2341
model must be used throughout this state. If a weighted average 2342
is used, the insurer must provide the office with an actuarial 2343
justification for using the weighted average which shows that 2344
the weighted average results in a rate that is reasonable, 2345
adequate, and fair. 2346
2347
The provisions of this subsection do not apply to workers' 2348
compensation, employer's liability insurance, and motor vehicle 2349
insurance. 2350
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Section 6. Paragraph (c) of subsection (1) and paragraph 2351
(d) of subsection (3) of section 627.0628, Florida Statutes, are 2352
amended to read: 2353
627.0628 Florida Commission on Hurricane Loss Pro jection 2354
Methodology; public records exemption; public meetings 2355
exemption.— 2356
(1) LEGISLATIVE FINDINGS AND INTENT. — 2357
(c) It is the intent of the Legislature to create the 2358
Florida Commission on Hurricane Loss Projection Methodology as a 2359
panel of experts to provide the most actuarially sophisticated 2360
guidelines and standards for projection of hurricane losses 2361
possible, given the current state of actuarial science. It is 2362
the further intent of the Legislature that such standards and 2363
guidelines must be used by th e State Board of Administration in 2364
developing reimbursement premium rates for the Florida Hurricane 2365
Catastrophe Fund, and, subject to paragraph (3)(d), must be used 2366
by insurers that provide hurricane or windstorm coverage in rate 2367
filings under s. 627.062 u nless the way in which such standards 2368
and guidelines were applied by the insurer was erroneous, as 2369
shown by a preponderance of the evidence. 2370
(3) ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES. — 2371
(d) With respect to a rate filing under s. 627.062, an 2372
insurer that provides hurricane or windstorm coverage shall 2373
employ and may not modify or adjust actuarial methods, 2374
principles, standards, models, or output ranges found by the 2375
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commission to be accurate or reliable in determining hurricane 2376
loss factors and probable maximum loss levels for use in a rate 2377
filing under s. 627.062. An insurer that provides hurricane or 2378
windstorm coverage may employ a model in a rate filing until 120 2379
days after the expiration of the commission's acceptance of that 2380
model and may not modify or adjust models found by the 2381
commission to be accurate or reliable in determining probable 2382
maximum loss levels. This paragraph does not prohibit an insurer 2383
from using a straight average of model results or output ranges 2384
for the purposes of a rate f iling for personal lines residential 2385
flood insurance coverage under s. 627.062. 2386
Section 7. Subsection (1) and paragraph (a) of subsection 2387
(3) of section 627.06281, Florida Statutes, are amended to read: 2388
627.06281 Public hurricane loss projection model; 2389
reporting of data by insurers. — 2390
(1) Within 30 days after a written request for loss data 2391
and associated exposure data by the office or the Florida 2392
International University center established to study mitigation, 2393
residential property insurers that provide hurricane or 2394
windstorm coverage and licensed rating and advisory 2395
organizations that compile residential property insurance loss 2396
data shall provide loss data and associated exposure data for 2397
residential property insurance policies to the office or t he 2398
Florida International University center established to study 2399
mitigation, as directed by the office, for the purposes of 2400
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developing, maintaining, and updating a public model for 2401
hurricane loss projections. The loss data and associated 2402
exposure data provided shall be in writing. 2403
(3)(a) A residential property insurer that provides 2404
hurricane or windstorm coverage may have access to and use the 2405
public hurricane loss projection model, including all 2406
assumptions and factors and all detailed loss results, for t he 2407
purpose of calculating rate indications in a rate filing and for 2408
analytical purposes, including any analysis or evaluation of the 2409
model required under actuarial standards of practice. 2410
Section 8. Subsections (1), (2), (4) and (9) of section 2411
627.0629, Florida Statutes, are amended to read: 2412
627.0629 Residential property insurance; rate filings. — 2413
(1) It is the intent of the Legislature that insurers that 2414
provide hurricane or windstorm coverage provide savings to 2415
consumers who install or implement win dstorm damage mitigation 2416
techniques, alterations, or solutions to their properties to 2417
prevent windstorm losses. A rate filing for residential property 2418
insurance that provides hurricane or windstorm coverage must 2419
include actuarially reasonable discounts, cr edits, or other rate 2420
differentials, or appropriate reductions in deductibles, for 2421
properties on which fixtures or construction techniques 2422
demonstrated to reduce the amount of loss in a windstorm have 2423
been installed or implemented. The fixtures or construct ion 2424
techniques must include, but are not limited to, fixtures or 2425
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construction techniques that enhance wind uplift prevention, 2426
roof strength, roof covering performance, roof -to-wall strength, 2427
wall-to-floor-to-foundation strength, opening protection, and 2428
window, door, and skylight strength. Credits, discounts, or 2429
other rate differentials, or appropriate reductions in 2430
deductibles, for fixtures and construction techniques that meet 2431
the minimum requirements of the Florida Building Code must be 2432
included in the rate filing. The office shall determine the 2433
discounts, credits, other rate differentials, and appropriate 2434
reductions in deductibles that reflect the full actuarial value 2435
of such revaluation, which may be used by insurers in rate 2436
filings. Effective July 1, 2025 October 1, 2023, each insurer 2437
subject to the requirements of this section which covers 2438
hurricane or windstorm losses must provide information on the 2439
insurer's website describing the hurricane mitigation discounts 2440
available to policyholders. Such informa tion must be accessible 2441
on, or through a hyperlink located on, the home page of the 2442
insurer's website or the primary page of the insurer's website 2443
for property insurance policyholders or applicants for such 2444
coverage in this state. On or before January 1, 2 025, and every 2445
5 years thereafter, the office shall reevaluate and update the 2446
fixtures or construction techniques demonstrated to reduce the 2447
amount of loss in a windstorm and the discounts, credits, other 2448
rate differentials, and appropriate reductions in d eductibles 2449
that reflect the full actuarial value of such fixtures or 2450
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construction techniques. The office shall adopt rules and forms 2451
necessitated by such reevaluation. 2452
(2)(a) A rate filing for residential property insurance 2453
made on or before the implemen tation of paragraph (b) may 2454
include rate factors that reflect the manner in which building 2455
code enforcement in a particular jurisdiction addresses the risk 2456
of wind damage if the insurer provides hurricane or windstorm 2457
coverage; however, such a rate filing must also provide for 2458
variations from such rate factors on an individual basis based 2459
on an inspection of a particular structure by a licensed home 2460
inspector, which inspection may be at the cost of the insured. 2461
(b) A rate filing for residential property i nsurance made 2462
more than 150 days after approval by the office of a building 2463
code rating factor plan submitted by a statewide rating 2464
organization shall include positive and negative rate factors 2465
that reflect the manner in which building code enforcement in a 2466
particular jurisdiction addresses risk of wind damage if the 2467
insurer provides hurricane or windstorm coverage . The rate 2468
filing shall include variations from standard rate factors on an 2469
individual basis based on inspection of a particular structure 2470
by a licensed home inspector. If an inspection is requested by 2471
the insured, the insurer may require the insured to pay the 2472
reasonable cost of the inspection. This paragraph applies to 2473
structures constructed or renovated after the implementation of 2474
this paragraph. 2475
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(c) The premium notice shall specify the amount by which 2476
the rate has been adjusted as a result of this subsection and 2477
shall also specify the maximum possible positive and negative 2478
adjustments that are approved for use by the insurer under this 2479
subsection. 2480
(4) The Legislature finds that separate consideration and 2481
notice of hurricane insurance premiums will assist consumers by 2482
providing greater assurance that hurricane premiums are lawful 2483
and by providing more complete information regarding the 2484
components of property insurance premiums. If a residential 2485
property insurance provides hurricane coverage, a rate filing 2486
for residential property insurance shall be separated into two 2487
components, rates for hurricane coverage and rates for all other 2488
coverages. A premium notice reflecting a rate implemented on the 2489
basis of such a filing shall separately indicate the premium for 2490
hurricane coverage and the premium for all other coverages. 2491
(9) An insurer that provides hurricane or windstorm 2492
coverage may file with the office a personal lines residential 2493
property insurance rating plan that provides justified premium 2494
discounts, credits, or other rate differentials based on 2495
windstorm mitigation construction standards developed by an 2496
independent, nonprofit scientific rese arch organization, if such 2497
standards meet the requirements of this section. Such plan must 2498
describe the manner in which the insurer will document the 2499
existence of the mitigation features and premium discounts, 2500
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credits, or other rate differentials created u nder such plan. 2501
Section 9. Section 627.4025, Florida Statutes, is amended 2502
to read: 2503
627.4025 Residential coverage and hurricane coverage 2504
defined.— 2505
(1) Residential coverage includes both personal lines 2506
residential coverage, which consists of the type of coverage 2507
provided by homeowner, mobile home owner, dwelling, tenant, 2508
condominium unit owner, cooperative unit owner, and similar 2509
policies, and commercial lines residential coverage, which 2510
consists of the type of coverage provided by condominium 2511
association, cooperative association, apartment building, and 2512
similar policies, including policies covering the common 2513
elements of a homeowners association. Residential coverage for 2514
personal lines and commercial lines as set forth in this section 2515
may include includes policies that provide coverage for 2516
particular perils such as windstorm and hurricane or coverage 2517
for insurer insolvency or deductibles. 2518
(2) As used in residential property policies that provide 2519
hurricane or windstorm providing residential coverage: 2520
(a) "Hurricane coverage" is coverage for loss or damage 2521
caused by wind, wind gusts, hail, rain, tornadoes, or cyclones 2522
caused by or resulting from the peril of windstorm during a 2523
hurricane. The term includes ensuing damage to the interior of a 2524
building, or to property inside a building, caused by rain, 2525
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snow, sleet, hail, sand, or dust if the direct force of the 2526
windstorm first damages the building, causing an opening through 2527
which rain, snow, sleet, hail, sand, or dust enters and causes 2528
damage. 2529
(b) "Windstorm" for purposes of paragraph (a) means wind, 2530
wind gusts, hail, rain, tornadoes, or cyclones caused by or 2531
resulting from a named tropical storm, including a hurricane, 2532
which create results in direct physical loss or damage to 2533
property. 2534
(c) "Hurricane" for purpose purposes of paragraph 2535
paragraphs (a) and (b) means a storm system that has been 2536
declared to be a hurricane by the National Hurricane Center of 2537
the National Weather Service. The duration of the hurricane 2538
includes the time period, in Florida: 2539
1. Beginning at the time a hurricane warning is issued for 2540
any part of Florida by the National Hurricane Center of the 2541
National Weather Service; and 2542
2. Ending 72 hours following the termination of the last 2543
hurricane watch or hurricane warning issued for any part of 2544
Florida by the National Hurricane Center of the National Weather 2545
Service. 2546
(d) "Hurricane deductible" means the deductible applicable 2547
to loss caused by a hurricane. 2548
Section 10. Subsection (3), paragraphs (c) and (d) of 2549
subsection (4), and subsections (5) and (9) of section 627.701, 2550
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Florida Statutes, are amended to read: 2551
627.701 Liability of insureds; coinsurance; deductibles. — 2552
(3)(a) Except as otherwise provided in this subsection, 2553
prior to issuing a personal lines residential property insurance 2554
policy, an the insurer that offers hurricane or windstorm 2555
coverage must offer alternative deductible amounts applicable to 2556
hurricane losses equal to $500, 2 percent, 5 percent, and 10 2557
percent of the policy dwelling limits, unless the specific 2558
percentage deductible is less than $500. The written notice of 2559
the offer shall specify the hurricane deductible to be applied 2560
in the event that the applicant or policyholder fails to 2561
affirmatively choose a hurricane deductible. The insurer must 2562
provide such policyholder with notice of the availability of the 2563
deductible amounts specified in this subsection in a form 2564
approved by the office in conjunction with each renewal of the 2565
policy. The failure to provide such notice constitutes a 2566
violation of this code but does not affect the coverage provided 2567
under the policy. 2568
(b) This subsection does not apply with respect to a 2569
deductible program lawfully in effect on July 1, 2025 June 14, 2570
1995, or to any similar deductible program, if the deductible 2571
program requires a minimum deductible amount of no less than 2 2572
percent of the policy limits. 2573
(c) With respect to a policy covering a risk with dwelling 2574
limits of at least $100,000, but less than $250,000, an the 2575
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insurer that offers hurricane or windstorm coverage may, in lieu 2576
of offering a policy with a $500 hurricane deductible as 2577
required by paragraph (a), offer a policy that the insurer 2578
guarantees it will not nonrenew for reasons of reducing 2579
hurricane loss for one renewal period and that contains up to a 2580
2 percent hurricane deductible as required by paragraph (a). 2581
(d) For the following policies, the following alternative 2582
deductible amounts are authorized: 2583
1. With respect to a policy covering a risk with dwelling 2584
limits of $250,000 or more, an the insurer that offers hurricane 2585
or windstorm coverage need not offer the $500 hurricane 2586
deductible as required by paragraph (a), but must, except as 2587
otherwise provided in this subsection, offer the other hurricane 2588
deductibles as required by paragraph (a). 2589
2. With respect to a policy covering a risk with dwelling 2590
limits of $1 million or more, but less than $3 million, an the 2591
insurer that offers hurricane or windstorm coverage may, in lieu 2592
of offering the 2 percent deductible as required by paragraph 2593
(a), offer a deductible amount applicable to hurricane losses 2594
equal to 3 percent of the policy dwelling limits. 2595
3. With respect to a policy covering a risk with dwelling 2596
limits of $3 million or more, an the insurer that offers 2597
hurricane or windstorm coverage need not offer the 2 percent 2598
deductible as required by paragraph (a), but must, except as 2599
otherwise provided by this subsection, offer the other hurricane 2600
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deductibles as required by paragraph (a). 2601
(4) 2602
(c) For any personal lines residential property insura nce 2603
policy containing an inflation guard rider, an the insurer that 2604
offers hurricane or windstorm coverage shall compute and 2605
prominently display the actual dollar value of the hurricane 2606
deductible on the declarations page of the policy at issuance 2607
and, for renewal, on the renewal declarations page of the policy 2608
or on the premium renewal notice. In addition, for any personal 2609
lines residential property insurance policy containing an 2610
inflation guard rider, an the insurer that offers hurricane or 2611
windstorm coverage shall notify the policyholder of the 2612
possibility that the hurricane deductible may be higher than 2613
indicated when loss occurs due to application of the inflation 2614
guard rider. Such notification shall be made on the declarations 2615
page of the policy at iss uance and, for renewal, on the renewal 2616
declarations page of the policy or on the premium renewal 2617
notice. 2618
(d)1. A personal lines residential property insurance 2619
policy covering a risk valued at less than $500,000 and 2620
providing hurricane or windstorm covera ge may not have a 2621
hurricane deductible in excess of 10 percent of the policy 2622
dwelling limits, unless the following conditions are met: 2623
a. The policyholder must personally write or type and 2624
provide to the insurer the following statement and sign his or 2625
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her name, which must also be signed by every other named insured 2626
on the policy, and dated: "I do not want the insurance on my 2627
home to pay for the first (specify dollar value) of damage from 2628
hurricanes. I will pay those costs. My insurance will not." 2629
b. If the structure insured by the policy is subject to a 2630
mortgage or lien, the policyholder must provide the insurer with 2631
a written statement from the mortgageholder or lienholder 2632
indicating that the mortgageholder or lienholder approves the 2633
policyholder electing to have the specified deductible. 2634
2. A deductible subject to the requirements of this 2635
paragraph applies for the term of the policy and for each 2636
renewal thereafter. Changes to the deductible percentage may be 2637
implemented only as of the date of renewal. 2638
3. An insurer shall keep the original copy of the signed 2639
statement required by this paragraph, electronically or 2640
otherwise, and provide a copy to the policyholder providing the 2641
signed statement. A signed statement meeting the requirements of 2642
this paragraph creates a presumption that there was an informed, 2643
knowing election of coverage. 2644
4. The commission shall adopt rules providing appropriate 2645
alternative methods for providing the statements required by 2646
this section for policyholders who have a handicapp ing or 2647
disabling condition that prevents them from providing a 2648
handwritten statement. 2649
(5)(a) The hurricane deductible of any personal lines 2650
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residential property insurance policy issued or renewed on or 2651
after July 1, 2025 May 1, 2005, and providing hurric ane or 2652
windstorm coverage shall be applied as follows: 2653
1. The hurricane deductible shall apply on an annual basis 2654
to all covered hurricane losses that occur during the calendar 2655
year for losses that are covered under one or more policies 2656
issued by the same insurer or an insurer in the same insurer 2657
group. 2658
2. If a hurricane deductible applies separately to each of 2659
one or more structures insured under a single policy, the 2660
requirements of this paragraph apply with respect to the 2661
deductible for each structure . 2662
3. If there was a hurricane loss for a prior hurricane or 2663
hurricanes during the calendar year, the insurer may apply a 2664
deductible to a subsequent hurricane which is the greater of the 2665
remaining amount of the hurricane deductible or the amount of 2666
the deductible that applies to perils other than a hurricane. 2667
Insurers may require policyholders to report hurricane losses 2668
that are below the hurricane deductible or to maintain receipts 2669
or other records of such hurricane losses in order to apply such 2670
losses to subsequent hurricane claims. 2671
4. If there are hurricane losses in a calendar year on 2672
more than one policy issued by the same insurer or an insurer in 2673
the same insurer group, the hurricane deductible shall be the 2674
highest amount stated in any one of the po licies. If a 2675
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policyholder who had a hurricane loss under the prior policy is 2676
provided or offered a lower hurricane deductible under the new 2677
or renewal policy, the insurer must notify the policyholder, in 2678
writing, at the time the lower hurricane deductible is provided 2679
or offered, that the lower hurricane deductible will not apply 2680
until January 1 of the following calendar year. 2681
(b) For commercial residential property insurance policies 2682
issued or renewed on or after July 1, 2025 January 1, 2006, and 2683
providing hurricane or windstorm coverage, the insurer must 2684
offer the policyholder the following alternative hurricane 2685
deductibles: 2686
1. A hurricane deductible that applies on an annual basis 2687
as provided in paragraph (a); and 2688
2. A hurricane deductible that appli es to each hurricane. 2689
(9) With respect to hurricane coverage provided in a 2690
policy of residential coverage, when the policyholder has taken 2691
appropriate hurricane mitigation measures regarding the 2692
residence covered under the policy, an the insurer that offers 2693
hurricane or windstorm coverage shall provide the insured the 2694
option of selecting an appropriate reduction in the policy's 2695
hurricane deductible or selecting the appropriate discount 2696
credit or other rate differential as provided in s. 627.0629. An 2697
The insurer that offers hurricane or windstorm coverage must 2698
provide the policyholder with notice of the options available 2699
under this subsection on a form approved by the office. 2700
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Section 11. Section 627.7018, Florida Statutes, is amended 2701
to read: 2702
627.7018 Standards for determining risk of coverage. —In 2703
determining the risk of providing property insurance coverage, 2704
an insurer may not deny coverage solely on the basis of the age 2705
of the structure and shall consider the wind resistance of the 2706
structure and measures undertaken by the owner to protect the 2707
structure against hurricane loss . 2708
Section 12. Subsections (1), (2), and (3) of section 2709
627.711, Florida Statutes, are amended to read: 2710
627.711 Notice of premium discounts for hurricane loss 2711
mitigation; uniform mitigation verification inspection form. — 2712
(1) Using a form prescribed by the Office of Insurance 2713
Regulation, an the insurer that offers hurricane or windstorm 2714
coverage shall clearly notify the applicant or policyholder of 2715
any personal lines residenti al property insurance policy, at the 2716
time of the issuance of the policy and at each renewal, of the 2717
availability and the range of each premium discount, credit, 2718
other rate differential, or reduction in deductibles, and 2719
combinations of discounts, credits, r ate differentials, or 2720
reductions in deductibles, for properties on which fixtures or 2721
construction techniques demonstrated to reduce the amount of 2722
loss in a windstorm can be or have been installed or 2723
implemented. The prescribed form shall describe generally what 2724
actions the policyholders may be able to take to reduce their 2725
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windstorm premium. The prescribed form and a list of such ranges 2726
approved by the office for each insurer licensed in the state 2727
offering hurricane or windstorm coverage and providing such 2728
discounts, credits, other rate differentials, or reductions in 2729
deductibles for properties described in this subsection shall be 2730
available for electronic viewing and download from the 2731
Department of Financial Services' or the Office of Insurance 2732
Regulation's Internet website. The Financial Services Commission 2733
may adopt rules to implement this subsection. 2734
(2)(a) The Financial Services Commission shall develop by 2735
rule a uniform mitigation verification inspection form that 2736
shall be used by all insurers that offer hurricane or windstorm 2737
coverage when submitted by policyholders for the purpose of 2738
factoring discounts for wind insurance. In developing the form, 2739
the commission shall seek input from the Citizens Property 2740
Insurance Corporation and the insurance, construction, and 2741
building code representatives. Further, the commission shall 2742
provide guidance as to the length of time the inspection results 2743
are valid. Insurers that offer hurricane or windstorm coverage 2744
An insurer shall accept as valid a uniform mitigation 2745
verification form signed by the following authorized mitigation 2746
inspectors: 2747
1. A home inspector licensed under s. 468.8314 who has 2748
completed at least 3 hours of hurricane mitigation training 2749
approved by the Construction Industry Licensing Board which 2750
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includes hurricane mitigation techniques and compliance with the 2751
uniform mitigation verification form and completion of a 2752
proficiency exam; 2753
2. A building code inspector certified under s. 468.607; 2754
3. A general, building, or residential contractor licensed 2755
under s. 489.111; 2756
4. A professional engineer licensed under s. 471.015; 2757
5. A professional architect licensed under s. 481.213; or 2758
6. Any other individual or entity recognized by the 2759
insurer as possessing the necessary qualifications to properly 2760
complete a uniform mitigation verification form. 2761
(b) An insurer that offers hurricane or windstorm coverage 2762
may, but is not required to, accept a form from any other person 2763
possessing qualifications and experience acceptable to the 2764
insurer. 2765
(3) A person who is authorized to sign a mitigation 2766
verification form must inspect the structures referenced by the 2767
form personally, not through employees or other persons, and 2768
must certify or attest to personal inspection of the structures 2769
referenced by the form. Ho wever, licensees under s. 471.015 or 2770
s. 489.111 may authorize a direct employee, who is not an 2771
independent contractor, and who possesses the requisite skill, 2772
knowledge and experience, to conduct a mitigation verification 2773
inspection. Insurers that offer hurricane or windstorm coverage 2774
shall have the right to request and obtain information from the 2775
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authorized mitigation inspector under s. 471.015 or s. 489.111, 2776
regarding any authorized employee's qualifications before prior 2777
to accepting a mitigation verifi cation form performed by an 2778
employee that is not licensed under s. 471.015 or s. 489.111. 2779
Section 13. Section 627.712, Florida Statutes is amended 2780
to read: 2781
627.712 Residential property insurance exclusion windstorm 2782
coverage required; availability of exclusions for windstorm or 2783
contents.— 2784
(1) An insurer issuing a residential property insurance 2785
policy must provide windstorm coverage. Except as provided in 2786
paragraph (2)(c), this section does not apply to risks that are 2787
eligible for wind-only coverage from Citizens Property Insurance 2788
Corporation under s. 627.351(6), and risks that are not eligible 2789
for coverage from Citizens Property Insurance Corporation under 2790
s. 627.351(6)(a)3. or 5. A risk ineligible for coverage by the 2791
corporation under s. 627.351(6)( a)3. or 5. is exempt from this 2792
section only if the risk is located within the boundaries of the 2793
coastal account of the corporation. 2794
(2) A property insurer must make available, at the option 2795
of the policyholder, an exclusion of windstorm coverage. 2796
(a) The coverage may be excluded only if: 2797
1. When the policyholder is a natural person, the 2798
policyholder personally writes or types and provides to the 2799
insurer the following statement and signs his or her name, which 2800
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must also be signed by every other named i nsured on the policy, 2801
and dated: "I do not want the insurance on my (home/mobile 2802
home/condominium unit) to pay for damage from windstorms. I will 2803
pay those costs. My insurance will not." 2804
2. When the policyholder is other than a natural person, 2805
the policyholder provides to the insurer on the policyholder's 2806
letterhead the following statement that must be signed by the 2807
policyholder's authorized representative and dated: "...(Name of 2808
entity)... does not want the insurance on its ...(type of 2809
structure)... to pay for damage from windstorms. ...(Name of 2810
entity)... will be responsible for these costs. ...(Name of 2811
entity's)... insurance will not." 2812
(b) If the structure insured by the policy is subject to a 2813
mortgage or lien, the policyholder must provide the insure r with 2814
a written statement from the mortgageholder or lienholder 2815
indicating that the mortgageholder or lienholder approves the 2816
policyholder electing to exclude windstorm coverage or hurricane 2817
coverage from his or her or its property insurance policy. 2818
(c) An insurer nonrenewing a policy and issuing a 2819
replacement policy, or issuing a new policy, that does not 2820
provide wind coverage shall provide a notice to the 2821
mortgageholder or lienholder indicating the policyholder has 2822
elected coverage that does not cover wind. 2823
(1)(3) An insurer issuing a residential property insurance 2824
policy, except for a condominium unit owner policy or a tenant 2825
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policy, must make available, at the option of the policyholder, 2826
an exclusion of coverage for the contents. The coverage may be 2827
excluded only if the policyholder personally writes or types and 2828
provides to the insurer the following statement and signs his or 2829
her signature, which must also be signed by every other named 2830
insured on the policy, and dated: "I do not want the insurance 2831
on my (home/mobile home) to pay for the costs to repair or 2832
replace any contents that are damaged. I will pay those costs. 2833
My insurance will not." 2834
(2)(4) An insurer shall keep the original copy of a signed 2835
statement required by this section, electronicall y or otherwise, 2836
and provide a copy to the policyholder providing the signed 2837
statement. A signed statement meeting the requirements of this 2838
section creates a presumption that there was an informed, 2839
knowing rejection of coverage. 2840
(3)(5) The exclusion exclusions authorized by subsection 2841
(1) applies this section apply for the term of the policy and 2842
for each renewal thereafter. Changes to the exclusion exclusions 2843
authorized by this section may be implemented only as of the 2844
date of renewal. 2845
(4)(6) The commission shall adopt rules providing 2846
appropriate alternative methods for providing the statements 2847
required by this section for policyholders who have a 2848
handicapping or disabling condition that prevents them from 2849
providing a handwritten statement. 2850
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Section 14. Section 627.713, Florida Statutes, is amended 2851
to read: 2852
627.713 Report of hurricane loss data. —The office may 2853
require property insurers that provide hurricane or windstorm 2854
coverage to report data regarding hurricane claims and 2855
underwriting costs, includ ing, but not limited to: 2856
(1) Number of claims. 2857
(2) Amount of claim payments made. 2858
(3) Number and amount of total -loss claims. 2859
(4) Amount and percentage of losses covered by reinsurance 2860
or other loss-transfer agreements. 2861
(5) Amount of losses cover ed under specified deductibles. 2862
(6) Claims and payments for specified insured values. 2863
(7) Claims and payments for specified dollar values. 2864
(8) Claims and payments for specified types of 2865
construction or mitigation features. 2866
(9) Claims and payments f or policies under specified 2867
underwriting criteria. 2868
(10) Claims and payments for contents, additional living 2869
expense, and other specified coverages. 2870
(11) Claims and payments by county for the information 2871
specified in this section. 2872
(12) Any other data that the office requires. 2873
Section 15. Subsection (7) of section 631.54, Florida 2874
Statutes, is amended to read: 2875
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631.54 Definitions. —As used in this part: 2876
(7) "Homeowner's insurance" means personal lines 2877
residential property insurance coverage that co nsists of the 2878
type of coverage provided under homeowner's, dwelling, and 2879
similar policies for repair or replacement of the insured 2880
structure and contents, which policies are written directly to 2881
the individual homeowner. Residential coverage for personal 2882
lines as set forth in this section : 2883
(a) Includes policies that provide coverage for particular 2884
perils, except that such residential coverage policies may, but 2885
are not required to, provide such as windstorm and hurricane 2886
coverage; and 2887
(b) but Excludes all coverage for mobile homes, renter's 2888
insurance, or tenant's coverage. 2889
2890
The term "homeowner's insurance" excludes commercial residential 2891
policies covering condominium associations or homeowners' 2892
associations, which associations have a responsibility to 2893
provide insurance coverage on residential units within the 2894
association, and also excludes coverage for the common elements 2895
of a homeowners' association. 2896
Section 16. Paragraph (a) of subsection (11) of section 2897
718.111, Florida Statutes, is amended to read: 2898
718.111 The association. — 2899
(11) INSURANCE.—In order to protect the safety, health, 2900
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and welfare of the people of the State of Florida and to ensure 2901
consistency in the provision of insurance coverage to 2902
condominiums and their unit owners, this subsection applies to 2903
every residential condominium in the state, regardless of the 2904
date of its declaration of condominium. It is the intent of the 2905
Legislature to encourage lower or stable insurance premiums for 2906
associations described in this subsection. 2907
(a) Adequate property insurance, regardless of any 2908
requirement in the declaration of condominium for coverage by 2909
the association for full insurable value, replacement cost, or 2910
similar coverage, must be based on the replacement cost of the 2911
property to be insured as d etermined by an independent insurance 2912
appraisal or update of a prior appraisal. The replacement cost 2913
must be determined at least once every 36 months. 2914
1. An association or group of associations may provide 2915
adequate property insurance through a self -insurance fund that 2916
complies with the requirements of ss. 624.460 -624.488. 2917
2.a. The association may also provide adequate property 2918
insurance coverage for a group of at least three communities 2919
created and operating under this chapter, chapter 719, chapter 2920
720, or chapter 721 by obtaining and maintaining for such 2921
communities insurance coverage sufficient to cover an amount 2922
equal to the probable maximum loss for the communities for a 2923
250-year windstorm event. Such probable maximum loss must be 2924
determined through the use of a competent model that has been 2925
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accepted by the Florida Commission on Hurricane Loss Projection 2926
Methodology. A policy or program providing such coverage may not 2927
be issued or renewed after July 1, 2008, unless it has been 2928
reviewed and approved by the Office of Insurance Regulation. The 2929
review and approval must include approval of the policy and 2930
related forms pursuant to ss. 627.410 and 627.411, approval of 2931
the rates pursuant to s. 627.062, a determination that the loss 2932
model approved by the commis sion was accurately and 2933
appropriately applied to the insured structures to determine the 2934
250-year probable maximum loss, and a determination that 2935
complete and accurate disclosure of all material provisions is 2936
provided to condominium unit owners before exec ution of the 2937
agreement by a condominium association. 2938
b. The association may also obtain windstorm coverage for 2939
the communities provided by Citizens Property Insurance 2940
Corporation under s. 627.351(5)(a)3. 2941
3. When determining the adequate amount of prope rty 2942
insurance coverage, the association may consider deductibles as 2943
determined by this subsection. 2944
Section 17. Paragraph (a) of subsection (3) of section 2945
719.104, Florida Statutes, is amended to read: 2946
719.104 Cooperatives; access to units; records; financial 2947
reports; assessments; purchase of leases. — 2948
(3) INSURANCE.—The association shall use its best efforts 2949
to obtain and maintain adequate insurance to protect the 2950
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association property. The association may also obtain and 2951
maintain liability insurance for directors and officers, 2952
insurance for the benefit of association employees, and flood 2953
insurance. A copy of each policy of insurance in effect shall be 2954
made available for inspection by unit owners at reasonable 2955
times. 2956
(a) Windstorm insurance coverage for a group of no fewer 2957
than three communities created and operating under chapter 718, 2958
this chapter, chapter 720, or chapter 721 may be obtained and 2959
maintained for the communities if the insurance coverage is : 2960
1. Sufficient to cover an amount equal to the probable 2961
maximum loss for the communities for a 250 -year windstorm event. 2962
Such probable maximum loss must be determined through the use of 2963
a competent model that has been accepted by the Florida 2964
Commission on Hurricane Loss Projection Methodology. Such 2965
insurance coverage is deemed adequate windstorm insurance for 2966
the purposes of this section ; or 2967
2. Provided by Citizens Property Insurance Corporation 2968
under s. 627.351(5)(a)3 . 2969
Section 18. Subsection (11) of section 720.303, Florida 2970
Statutes, is amended to read: 2971
720.303 Association powers and duties; meetings of board; 2972
official records; budgets; financial reporting; association 2973
funds; recalls.— 2974
(11) WINDSTORM INSURANCE. —Windstorm insurance coverage for 2975
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a group of no fewer than three communities cre ated and operating 2976
under chapter 718, chapter 719, this chapter, or chapter 721 may 2977
be obtained and maintained for the communities if the insurance 2978
coverage is: 2979
(a) Sufficient to cover an amount equal to the probable 2980
maximum loss for the communities for a 250-year windstorm event. 2981
Such probable maximum loss must be determined through the use of 2982
a competent model that has been accepted by the Florida 2983
Commission on Hurricane Loss Projection Methodology. Such 2984
insurance coverage is deemed adequate windstorm c overage for 2985
purposes of this chapter ; or 2986
(b) Provided by Citizens Property Insurance Corporation 2987
under s. 627.351(5)(a)3 . 2988
Section 19. Paragraph (b) of subsection (2) of section 2989
395.1061, Florida Statutes, is amended to read: 2990
395.1061 Professional liability coverage.— 2991
(2) Each hospital, unless exempted under paragraph (3)(b), 2992
must demonstrate financial responsibility for maintaining 2993
professional liability coverage to pay claims and costs 2994
ancillary thereto arising out of the rendering of or failure to 2995
render medical care or services and for bodily injury or 2996
property damage to the person or property of any patient arising 2997
out of the activities of the hospital or arising out of the 2998
activities of covered individuals, to the satisfaction of the 2999
Agency for Health Care Administration, by meeting one of the 3000
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following requirements: 3001
(b) Obtain professional liability coverage in an amount 3002
equivalent to $10,000 or more per claim for each bed in such 3003
hospital from a private insurer, from the Joint Underwriting 3004
Association established under s. 627.351(3) s. 627.351(4), or 3005
through a plan of self -insurance as provided in s. 627.357. 3006
However, a hospital may not be required to obtain such coverage 3007
in an amount exceeding a $2.5 million annual aggregate. 3008
Section 20. Paragraph (b) of subsection (1) and paragraph 3009
(b) of subsection (2) of section 458.320, Florida Statutes, are 3010
amended to read: 3011
458.320 Financial responsibility. — 3012
(1) As a condition of licensing and maintaining an active 3013
license, and prior to the iss uance or renewal of an active 3014
license or reactivation of an inactive license for the practice 3015
of medicine, an applicant must by one of the following methods 3016
demonstrate to the satisfaction of the board and the department 3017
financial responsibility to pay cla ims and costs ancillary 3018
thereto arising out of the rendering of, or the failure to 3019
render, medical care or services: 3020
(b) Obtaining and maintaining professional liability 3021
coverage in an amount not less than $100,000 per claim, with a 3022
minimum annual aggreg ate of not less than $300,000, from an 3023
authorized insurer as defined under s. 624.09, from a surplus 3024
lines insurer as defined under s. 626.914(2), from a risk 3025
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retention group as defined under s. 627.942, from the Joint 3026
Underwriting Association established under s. 627.351(3) s. 3027
627.351(4), or through a plan of self -insurance as provided in 3028
s. 627.357. The required coverage amount set forth in this 3029
paragraph may not be used for litigation costs or attorney's 3030
fees for the defense of any medical malpractice cl aim. 3031
(2) Physicians who perform surgery in an ambulatory 3032
surgical center licensed under chapter 395 and, as a continuing 3033
condition of hospital staff privileges, physicians who have 3034
staff privileges must also establish financial responsibility by 3035
one of the following methods: 3036
(b) Obtaining and maintaining professional liability 3037
coverage in an amount not less than $250,000 per claim, with a 3038
minimum annual aggregate of not less than $750,000 from an 3039
authorized insurer as defined under s. 624.09, from a sur plus 3040
lines insurer as defined under s. 626.914(2), from a risk 3041
retention group as defined under s. 627.942, from the Joint 3042
Underwriting Association established under s. 627.351(3) s. 3043
627.351(4), through a plan of self -insurance as provided in s. 3044
627.357, or through a plan of self -insurance which meets the 3045
conditions specified for satisfying financial responsibility in 3046
s. 766.110. The required coverage amount set forth in this 3047
paragraph may not be used for litigation costs or attorney's 3048
fees for the defense of any medical malpractice claim. 3049
3050
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This subsection shall be inclusive of the coverage in subsection 3051
(1). 3052
Section 21. Paragraph (b) of subsection (1) and paragraph 3053
(b) of subsection (2) of section 459.0085, Florida Statutes, are 3054
amended to read: 3055
459.0085 Financial responsibility. — 3056
(1) As a condition of licensing and maintaining an active 3057
license, and prior to the issuance or renewal of an active 3058
license or reactivation of an inactive license for the practice 3059
of osteopathic medicine, an applicant must by one of the 3060
following methods demonstrate to the satisfaction of the board 3061
and the department financial responsibility to pay claims and 3062
costs ancillary thereto arising out of the rendering of, or the 3063
failure to render, medical care or services: 3064
(b) Obtaining and maintaining professional liability 3065
coverage in an amount not less than $100,000 per claim, with a 3066
minimum annual aggregate of not less than $300,000, from an 3067
authorized insurer as defined under s. 624.09, from a surplus 3068
lines insurer as define d under s. 626.914(2), from a risk 3069
retention group as defined under s. 627.942, from the Joint 3070
Underwriting Association established under s. 627.351(3) s. 3071
627.351(4), or through a plan of self -insurance as provided in 3072
s. 627.357. The required coverage amou nt set forth in this 3073
paragraph may not be used for litigation costs or attorney's 3074
fees for the defense of any medical malpractice claim. 3075
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(2) Osteopathic physicians who perform surgery in an 3076
ambulatory surgical center licensed under chapter 395 and, as a 3077
continuing condition of hospital staff privileges, osteopathic 3078
physicians who have staff privileges must also establish 3079
financial responsibility by one of the following methods: 3080
(b) Obtaining and maintaining professional liability 3081
coverage in an amount n ot less than $250,000 per claim, with a 3082
minimum annual aggregate of not less than $750,000 from an 3083
authorized insurer as defined under s. 624.09, from a surplus 3084
lines insurer as defined under s. 626.914(2), from a risk 3085
retention group as defined under s. 6 27.942, from the Joint 3086
Underwriting Association established under s. 627.351(3) s. 3087
627.351(4), through a plan of self -insurance as provided in s. 3088
627.357, or through a plan of self -insurance that meets the 3089
conditions specified for satisfying financial resp onsibility in 3090
s. 766.110. The required coverage amount set forth in this 3091
paragraph may not be used for litigation costs or attorney's 3092
fees for the defense of any medical malpractice claim. 3093
3094
This subsection shall be inclusive of the coverage in subsection 3095
(1). 3096
Section 22. Paragraph (a) of subsection (2) of section 3097
464.0123, Florida Statutes, is amended to read: 3098
464.0123 Autonomous practice by an advanced practice 3099
registered nurse.— 3100
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(2) FINANCIAL RESPONSIBILITY. — 3101
(a) An advanced practice registered nurse registered under 3102
this section must, by one of the following methods, demonstrate 3103
to the satisfaction of the board and the department financial 3104
responsibility to pay claims and costs ancillary thereto arising 3105
out of the rendering of, or the failure to render, nursing care, 3106
treatment, or services: 3107
1. Obtaining and maintaining professional liability 3108
coverage in an amount not less than $100,000 per claim, with a 3109
minimum annual aggregate of not less than $300,000, from an 3110
authorized insurer as defined in s. 624.09, from a surplus lines 3111
insurer as defined in s. 626.914(2), from a risk retention group 3112
as defined in s. 627.942, from the Joint Underwriting 3113
Association established under s. 627.351(3) s. 627.351(4), or 3114
through a plan of self -insurance as provided in s. 627.357; or 3115
2. Obtaining and maintaining an unexpired, irrevocable 3116
letter of credit, established pursuant to chapter 675, in an 3117
amount of not less than $100,000 per claim, with a minimum 3118
aggregate availability of credit of not less than $300,000 . The 3119
letter of credit must be payable to the advanced practice 3120
registered nurse as beneficiary upon presentment of a final 3121
judgment indicating liability and awarding damages to be paid by 3122
the advanced practice registered nurse or upon presentment of a 3123
settlement agreement signed by all parties to such agreement 3124
when such final judgment or settlement is a result of a claim 3125
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arising out of the rendering of, or the failure to render, 3126
nursing care and services. 3127
Section 23. Paragraph (a) of subsection (10) o f section 3128
624.424, Florida Statutes, is amended to read: 3129
624.424 Annual statement and other information. — 3130
(10)(a) By January 1, 2025, and each month thereafter, 3131
each insurer or insurer group doing business in this state shall 3132
file on a monthly basis a supplemental report on an individual 3133
and group basis on a form prescribed by the commission with 3134
information on personal lines and commercial lines residential 3135
property insurance policies in this state. The supplemental 3136
report must include separate informa tion for personal lines 3137
property policies and for commercial lines property policies and 3138
totals for each item specified, including premiums written for 3139
each of the property lines of business as described in ss. 3140
215.555(2)(c) and 627.351(5)(a) 627.351(6)(a). The report must 3141
include the following information for each zip code: 3142
1. Total number of policies in force at the end of each 3143
month. 3144
2. Total number of policies canceled. 3145
3. Total number of policies nonrenewed. 3146
4. Number of policies canceled due to hurricane risk. 3147
5. Number of policies nonrenewed due to hurricane risk. 3148
6. Number of new policies written. 3149
7. Total dollar value of structure exposure under policies 3150
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that include wind coverage. 3151
8. Number of policies that exclude wind coverage. 3152
9. Number of claims open each month. 3153
10. Number of claims closed each month. 3154
11. Number of claims pending each month. 3155
12. Number of claims in which either the insurer or 3156
insured invoked any form of alternative dispute resolution, and 3157
specifying which form of alternative dispute resolution was 3158
used. 3159
Section 24. Paragraph (a) of subsection (2) and subsection 3160
(5) of section 624.462, Florida Statutes, are amended to read: 3161
624.462 Commercial self -insurance funds.— 3162
(2) As used in ss. 624.460 -624.488, "commercial self-3163
insurance fund" or "fund" means a group of members, operating 3164
individually and collectively through a trust or corporation, 3165
that must be: 3166
(a) Established by: 3167
1. A not-for-profit trade association, industry 3168
association, or profession al association of employers or 3169
professionals which has a constitution or bylaws, which is 3170
incorporated under the laws of this state, and which has been 3171
organized for purposes other than that of obtaining or providing 3172
insurance and operated in good faith fo r a continuous period of 3173
1 year; 3174
2. A self-insurance trust fund organized pursuant to s. 3175
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627.357 and maintained in good faith for a continuous period of 3176
1 year for purposes other than that of obtaining or providing 3177
insurance pursuant to this section. Eac h member of a commercial 3178
self-insurance trust fund established pursuant to this 3179
subsection must maintain membership in the self -insurance trust 3180
fund organized pursuant to s. 627.357; 3181
3. A group of 10 or more health care providers, as defined 3182
in s. 627.351(3)(h) s. 627.351(4)(h), for purposes of providing 3183
medical malpractice coverage; or 3184
4. A not-for-profit group comprised of one or more 3185
community associations responsible for operating at least 50 3186
residential parcels or units created and operating under chapter 3187
718, chapter 719, chapter 720, chapter 721, or chapter 723 which 3188
restricts its membership to community associations only and 3189
which has been organized and maintained in good faith for the 3190
purpose of pooling and spreading the liabilities of its group 3191
members relating to property or casualty risk or surety 3192
insurance which, in accordance with applicable provisions of 3193
part I of chapter 626, appoints resident general lines agents 3194
only, and which does not prevent, impede, or restrict any 3195
applicant or fund participant from maintaining or selecting an 3196
agent of choice. The fund may not refuse to appoint the agent of 3197
record for any fund applicant or fund member and may not favor 3198
one or more such appointed agents over other appointed agents. 3199
(5) A commercial self-insurance fund created under 3200
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subparagraph (2)(a)4. shall be an insurer for the purpose of any 3201
assessments levied by the Florida Hurricane Catastrophe Fund as 3202
provided under s. 215.555 or by the Citizens Property Insurance 3203
Corporation as provided under s. 627.351(5)(b)3 s. 3204
627.351(6)(b)3. The office shall establish the method for 3205
determining the imputed premium that is subject to any such 3206
assessment. 3207
Section 25. Section 625.317, Florida Statutes, is amended 3208
to read: 3209
625.317 Corporate bonds and debentures. —An insurer may 3210
invest in bonds, notes, or other interest -bearing or interest-3211
accruing obligations of any solvent corporation organized under 3212
the laws of the United States or Canada or under the laws of any 3213
state, the District of Columbia, any territory or possession of 3214
the United States, or any Province of Canada or in bonds or 3215
notes issued by the Citizens Property Insurance Corporation as 3216
authorized by s. 627.351(5) s. 627.351(6). 3217
Section 26. Subsection (2) of s ection 627.0655, Florida 3218
Statutes, is amended to read: 3219
627.0655 Policyholder loss or expense -related premium 3220
discounts.—An insurer or person authorized to engage in the 3221
business of insurance in this state may include, in the premium 3222
charged an insured fo r any policy, contract, or certificate of 3223
insurance, a discount based on the fact that another policy, 3224
contract, or certificate of any type has been purchased by the 3225
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insured from: 3226
(2) The Citizens Property Insurance Corporation created 3227
under s. 627.351(5) s. 627.351(6), if the same insurance agent 3228
is servicing both policies; 3229
Section 27. Subsection (4) and paragraph (b) of subsection 3230
(6) of section 627.3511, Florida Statutes, are amended to read: 3231
627.3511 Depopulation of Citizens Property Insurance 3232
Corporation.— 3233
(4) AGENT BONUS.—When the corporation enters into a 3234
contractual agreement for a take -out plan that provides a bonus 3235
to the insurer, the producing agent of record of the corporation 3236
policy is entitled to retain any unearned commission on such 3237
policy, and the insurer shall either: 3238
(a) Pay to the producing agent of record of the 3239
association policy, for the first year, an amount that is the 3240
greater of the insurer's usual and customary commission for the 3241
type of policy written or a fee equal to the usual and customary 3242
commission of the corporation; or 3243
(b) Offer to allow the producing agent of record of the 3244
corporation policy to continue servicing the policy for a period 3245
of not less than 1 year and offer to pay the agent the greater 3246
of the insurer's or the corporation's usual and customary 3247
commission for the type of policy written. 3248
3249
If the producing agent is unwilling or unable to accept 3250
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appointment, the new insurer shall pay the agent in accordance 3251
with paragraph (a). The requirement of thi s subsection that the 3252
producing agent of record is entitled to retain the unearned 3253
commission on an association policy does not apply to a policy 3254
for which coverage has been provided in the association for 30 3255
days or less or for which a cancellation notice has been issued 3256
pursuant to s. 627.351(5)(c)9 s. 627.351(6)(c)10. during the 3257
first 30 days of coverage. 3258
(6) COMMERCIAL RESIDENTIAL TAKE -OUT PLANS.— 3259
(b) In order for a plan to qualify for approval: 3260
1. At least 40 percent of the policies removed from the 3261
corporation under the plan must be located in Miami -Dade, 3262
Broward, and Palm Beach Counties, or at least 30 percent of the 3263
policies removed from the corporation under the plan must be 3264
located in such counties and an additional 50 percent of the 3265
policies removed from the corporation must be located in other 3266
coastal counties. 3267
2. The insurer must renew the replacement policy at 3268
approved rates on substantially similar terms for two additional 3269
1-year terms, unless canceled or nonrenewed by the insurer for a 3270
lawful reason other than reduction of hurricane exposure . If an 3271
insurer assumes the corporation's obligations for a policy, it 3272
must issue a replacement policy for a 1 -year term upon 3273
expiration of the corporation policy and must renew the 3274
replacement policy at approved rates on substantially similar 3275
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terms for two additional 1 -year terms, unless canceled by the 3276
insurer for a lawful reason other than reduction of hurricane 3277
exposure. For each replacement policy canceled or nonrenewed by 3278
the insurer for any rea son during the 3-year coverage period 3279
required by this subparagraph, the insurer must remove from the 3280
corporation one additional policy covering a risk similar to the 3281
risk covered by the canceled or nonrenewed policy. 3282
Section 28. Subsection (1) of sect ion 627.3512, Florida 3283
Statutes, is amended to read: 3284
627.3512 Recoupment of residual market deficit 3285
assessments.— 3286
(1) The Legislature finds and declares that all 3287
assessments paid by an insurer or insurer group as a result of a 3288
levy by any residual marke t entity, including regular 3289
assessments levied on insurers by Citizens Property Insurance 3290
Corporation and any other assessments levied on insurers by an 3291
insurance risk apportionment plan or assigned risk plan under s. 3292
627.311 or s. 627.351 constitute advan ces of funds from the 3293
insurer to the residual market entity, and that the insurer is 3294
entitled to fully recoup such advances. An insurer or insurer 3295
group may recoup any assessments that have been paid during or 3296
after 1995 by the insurer or insurer group to defray deficits of 3297
an insurance risk apportionment plan or assigned risk plan under 3298
ss. 627.311 and 627.351, net of any earnings returned to the 3299
insurer or insurer group by the association or plan for any year 3300
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after 1993. A limited apportionment company as defined in s. 3301
627.351(5)(c) s. 627.351(6)(c) may recoup any regular assessment 3302
that has been levied by, or paid to, Citizens Property Insurance 3303
Corporation. 3304
Section 29. Paragraph (a) of subsection (1) and subsection 3305
(5) of section 627.3513, Florida St atutes, are amended to read: 3306
627.3513 Standards for sale of bonds by Citizens Property 3307
Insurance Corporation. — 3308
(1)(a) The purpose of this section is to provide standards 3309
for the sale of bonds pursuant to s. 627.351(5) s. 627.351(2) 3310
and (6). 3311
(5) This section is not intended to restrict or prohibit 3312
the employment of professional services relating to bonds issued 3313
under s. 627.351(5) s. 627.351(6) or the issuance of bonds by 3314
the corporation. 3315
Section 30. Paragraph (a) of subsection (3) of section 3316
627.3515, Florida Statutes, is amended to read: 3317
627.3515 Market assistance plan; property and casualty 3318
risks.— 3319
(3)(a) The plan and the corporation shall develop a 3320
business plan and present it to the Financial Services 3321
Commission for approval by September 1, 2007, to provide for the 3322
implementation of an electronic database for the purpose of 3323
confirming eligibility pursuant to s. 627.351(5) s. 627.351(6). 3324
The business plan may provide that authorized insurers or agents 3325
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of authorized insurers may submit to the plan or the corporation 3326
in electronic form, as determined by the plan or the 3327
corporation, information determined necessary by the plan or the 3328
corporation to deny coverage to risks ineligible for coverage by 3329
the corporation. Any authorized insurer submittin g such 3330
information that results in a risk being denied coverage by the 3331
corporation is required to offer coverage to the risk at its 3332
approved rates, for the coverage and premium quoted, for at 3333
least 1 year. 3334
Section 31. Section 627.3517, Florida Statutes , is amended 3335
to read: 3336
627.3517 Consumer choice. —No provision of s. 627.351, s. 3337
627.3511, or s. 627.3515 shall be construed to impair the right 3338
of any insurance risk apportionment plan policyholder, upon 3339
receipt of any keepout or take -out offer, to retain his or her 3340
current agent, so long as that agent is duly licensed and 3341
appointed by the insurance risk apportionment plan or otherwise 3342
authorized to place business with the insurance risk 3343
apportionment plan. This right shall not be canceled, suspended, 3344
impeded, abridged, or otherwise compromised by any rule, plan of 3345
operation, or depopulation plan, whether through keepout, take -3346
out, midterm assumption, or any other means, of any insurance 3347
risk apportionment plan or depopulation plan, including, but not 3348
limited to, those described in s. 627.351, s. 627.3511, or s. 3349
627.3515. The commission shall adopt any rules necessary to 3350
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cause any insurance risk apportionment plan or market assistance 3351
plan under such sections to demonstrate that the operations of 3352
the plan do not interfere with, promote, or allow interference 3353
with the rights created under this section. If the 3354
policyholder's current agent is unable or unwilling to be 3355
appointed with the insurer making the take -out or keepout offer, 3356
the policyholder shall not be disqualified from participation in 3357
the appropriate insurance risk apportionment plan because of an 3358
offer of coverage in the voluntary market. An offer of full 3359
property insurance coverage by the insurer currently insuring 3360
either the ex-wind or wind-only coverage on the policy to which 3361
the offer applies shall not be considered a take -out or keepout 3362
offer. Any rule, plan of operation, or plan of depopulation, 3363
through keepout, take -out, midterm assumption, or any other 3364
means, of any property insurance risk appo rtionment plan under 3365
s. 627.351(5) s. 627.351(2) or (6) is subject to ss. 3366
627.351(5)(c) ss. 627.351(2)(b) and (6)(c) and 627.3511(4). 3367
Section 32. Subsection (5), paragraph (a) of subsection 3368
(6), and paragraph (a) of subsection (7) of section 627.3518, 3369
Florida Statutes, are amended to read: 3370
627.3518 Citizens Property Insurance Corporation 3371
policyholder eligibility clearinghouse program. —The purpose of 3372
this section is to provide a framework for the corporation to 3373
implement a clearinghouse program by Janu ary 1, 2014. 3374
(5) Notwithstanding s. 627.3517, any applicant for new 3375
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coverage from the corporation is not eligible for coverage from 3376
the corporation if provided an offer of coverage from an 3377
authorized insurer through the program at a premium that is at 3378
or below the eligibility threshold for applicants for new 3379
coverage of a primary residence established in s. 3380
627.351(5)(c)4.a. s. 627.351(6)(c)5.a. , or for applicants for 3381
new coverage of a risk that is not a primary residence 3382
established in s. 627.351(5)(c)4.b s. 627.351(6)(c)5.b. Whenever 3383
an offer of coverage for a personal lines risk is received for a 3384
policyholder of the corporation at renewal from an authorized 3385
insurer through the program which is at or below the eligibility 3386
threshold for primary residences of policyholders of the 3387
corporation established in s. 627.351(5)(c)4.a. s. 3388
627.351(6)(c)5.a., or the eligibility threshold for risks that 3389
are not primary residences of policyholders of the corporation 3390
established in s. 627.351(5)(c)4.b. s. 627.351(6)(c)5.b., the 3391
risk is not eligible for coverage with the corporation. In the 3392
event an offer of coverage for a new applicant is received from 3393
an authorized insurer through the program, and the premium 3394
offered exceeds the eligibility threshold for a pplicants for new 3395
coverage of a primary residence established in s. 3396
627.351(5)(c)4.a. s. 627.351(6)(c)5.a. , or the eligibility 3397
threshold for applicants for new coverage on a risk that is not 3398
a primary residence established in s. 627.351(5)(c)4.b. s. 3399
627.351(6)(c)5.b., the applicant or insured may elect to accept 3400
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such coverage, or may elect to accept or continue coverage with 3401
the corporation. In the event an offer of coverage for a 3402
personal lines risk is received from an authorized insurer at 3403
renewal through the program, and the premium offered exceeds the 3404
eligibility threshold for primary residences of policyholders of 3405
the corporation established in s. 627.351(5)(c)4.a. s. 3406
627.351(6)(c)5.a., or exceeds the eligibility threshold for 3407
risks that are not primary residences of policyholders of the 3408
corporation established in s. 627.351(5)(c)4.b. s. 3409
627.351(6)(c)5.b., the insured may elect to accept such 3410
coverage, or may elect to accept or continue coverage with the 3411
corporation. Section 627.351(5)(c)4.a.(I) 627.351(6)(c)5.a.(I) 3412
and b.(I) does not apply to an offer of coverage from an 3413
authorized insurer obtained through the program. As used in this 3414
subsection, the term "primary residence" has the same meaning as 3415
in s. 627.351(5)(mm) s. 627.351(6)(c)2.a. 3416
(6) Independent insurance agents submitting new 3417
applications for coverage or that are the agent of record on a 3418
renewal policy submitted to the program: 3419
(a) Are granted and must maintain ownership and the 3420
exclusive use of expirations, records, or other written or 3421
electronic information directly related to such applications or 3422
renewals written through the corporation or through an insurer 3423
participating in the program, notwithstanding s. 3424
627.351(5)(c)4.a.(I)(B) s. 627.351(6)(c)5.a.(I)(B) and (II)(B) 3425
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or s. 627.351(5)(c)4.b.(I)(B) s. 627.351(6)(c)5.b.(I)(B) and 3426
(II)(B). Such ownership is granted for as long as the insured 3427
remains with the agency or until sold or surrendered in writing 3428
by the agent. Contracts with the corporation or required by the 3429
corporation must not amen d, modify, interfere with, or limit 3430
such rights of ownership. Such expirations, records, or other 3431
written or electronic information may be used to review an 3432
application, issue a policy, or for any other purpose necessary 3433
for placing such business through t he program. 3434
3435
Applicants ineligible for coverage in accordance with subsection 3436
(5) remain ineligible if their independent agent is unwilling or 3437
unable to enter into a standard or limited agency agreement with 3438
an insurer participating in the program. 3439
(7) Exclusive agents submitting new applications for 3440
coverage or that are the agent of record on a renewal policy 3441
submitted to the program: 3442
(a) Must maintain ownership and the exclusive use of 3443
expirations, records, or other written or electronic information 3444
directly related to such applications or renewals written 3445
through the corporation or through an insurer participating in 3446
the program, notwithstanding s. 627.351(5)(c)4.a.(I)(B) s. 3447
627.351(6)(c)5.a.(I)(B) and (II)(B) or s. 3448
627.351(5)(c)4.b.(I)(B) s. 627.351(6)(c)5.b.(I)(B) and (II)(B). 3449
Contracts with the corporation or required by the corporation 3450
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must not amend, modify, interfere with, or limit such rights of 3451
ownership. Such expirations, records, or other written or 3452
electronic information may be used to revie w an application, 3453
issue a policy, or for any other purpose necessary for placing 3454
such business through the program. 3455
3456
Applicants ineligible for coverage in accordance with subsection 3457
(5) remain ineligible if their exclusive agent is unwilling or 3458
unable to enter into a standard or limited agency agreement with 3459
an insurer making an offer of coverage to that applicant. 3460
Section 33. Paragraphs (b) of subsection (2) of section 3461
627.4133, Florida Statutes, is amended to read: 3462
627.4133 Notice of cancellation, nonrenewal, or renewal 3463
premium.— 3464
(2) With respect to any personal lines or commercial 3465
residential property insurance policy, including, but not 3466
limited to, any homeowner, mobile home owner, farmowner, 3467
condominium association, condominium unit owner, apar tment 3468
building, or other policy covering a residential structure or 3469
its contents: 3470
(b) The insurer shall give the first -named insured written 3471
notice of nonrenewal, cancellation, or termination at least 120 3472
days before the effective date of the nonrenewal, cancellation, 3473
or termination. The notice must include the reason for the 3474
nonrenewal, cancellation, or termination, except that: 3475
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1. If cancellation is for nonpayment of premium, at least 3476
10 days' written notice of cancellation accompanied by the 3477
reason therefor must be given. As used in this subparagraph, the 3478
term "nonpayment of premium" means failure of the named insured 3479
to discharge when due her or his obligations for paying the 3480
premium on a policy or an installment of such premium, whether 3481
the premium is payable directly to the insurer or its agent or 3482
indirectly under a premium finance plan or extension of credit, 3483
or failure to maintain membership in an organization if such 3484
membership is a condition precedent to insurance coverage. The 3485
term also means the failure of a financial institution to honor 3486
an insurance applicant's check after delivery to a licensed 3487
agent for payment of a premium even if the agent has previously 3488
delivered or transferred the premium to the insurer. If a 3489
dishonored check represents the initial premium payment, the 3490
contract and all contractual obligations are void ab initio 3491
unless the nonpayment is cured within the earlier of 5 days 3492
after actual notice by certified mail is received by the 3493
applicant or 15 days after notice is sent to the applicant by 3494
certified mail or registered mail. If the contract is void, any 3495
premium received by the insurer from a third party must be 3496
refunded to that party in full. 3497
2. If cancellation or termination occurs during the first 3498
60 days the insurance is in force and the insurance is canceled 3499
or terminated for reasons other than nonpayment of premium, at 3500
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least 20 days' written notice of cancellation or termination 3501
accompanied by the reason therefor must be given unless there 3502
has been a material misstateme nt or misrepresentation or a 3503
failure to comply with the underwriting requirements established 3504
by the insurer. 3505
3. After the policy has been in effect for 60 days, the 3506
policy may not be canceled by the insurer unless there has been 3507
a material misstatement; a nonpayment of premium; a failure to 3508
comply, within 60 days after the date of effectuation of 3509
coverage, with underwriting requirements established by the 3510
insurer before the date of effectuation of coverage; or a 3511
substantial change in the risk covered by the policy or unless 3512
the cancellation is for all insureds under such policies for a 3513
given class of insureds. This subparagraph does not apply to 3514
individually rated risks that have a policy term of less than 90 3515
days. 3516
4. After a policy or contract has been in effect for more 3517
than 60 days, the insurer may not cancel or terminate the policy 3518
or contract based on credit information available in public 3519
records. 3520
5. A policy that is nonrenewed by Citizens Property 3521
Insurance Corporation, pursuant to s. 627.351(5) s. 627.351(6), 3522
for a policy that has been assumed by an authorized insurer 3523
offering replacement coverage to the policyholder is exempt from 3524
the notice requirements of paragraph (a) and this paragraph. In 3525
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such cases, the corporation must give the named ins ured written 3526
notice of nonrenewal at least 45 days before the effective date 3527
of the nonrenewal. 3528
6. Notwithstanding any other provision of law, an insurer 3529
may cancel or nonrenew a property insurance policy after at 3530
least 45 days' notice if the office find s that the early 3531
cancellation of some or all of the insurer's policies is 3532
necessary to protect the best interests of the public or 3533
policyholders and the office approves the insurer's plan for 3534
early cancellation or nonrenewal of some or all of its policies. 3535
The office may base such finding upon the financial condition of 3536
the insurer, lack of adequate reinsurance coverage for hurricane 3537
risk, or other relevant factors. The office may condition its 3538
finding on the consent of the insurer to be placed under 3539
administrative supervision pursuant to s. 624.81 or to the 3540
appointment of a receiver under chapter 631. 3541
7. A policy covering both a home and a motor vehicle may 3542
be nonrenewed for any reason applicable to the property or motor 3543
vehicle insurance after providing 90 days' notice. 3544
Section 34. Subsection (2) of section 627.945, Florida 3545
Statutes, is amended to read: 3546
627.945 Compulsory association. — 3547
(2) A risk retention group shall participate in this 3548
state's joint underwriting associations as established under ss. 3549
627.311(3) and 627.351(1) through, (3), (4), and (5). 3550
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Section 35. Subsection (4) of section 628.6017, Florida 3551
Statutes, is amended to read: 3552
628.6017 Converting assessable mutual insurer. — 3553
(4) An assessable mutual insurer becoming a stock insur er 3554
or a nonassessable mutual insurer is not subject to s. 627.215 3555
or s. 627.351(4) s. 627.351(5) for 5 years following 3556
authorization of the conversion by the office. However, the 3557
converted stock insurer or nonassessable mutual insurer must 3558
file all necessary data required by s. 627.215. Such amounts 3559
otherwise subject to s. 627.215(8) must be maintained as surplus 3560
as to policyholders and are not available for dividends for 5 3561
years. 3562
Section 36. This act shall take effect July 1, 2025. 3563