Bill Text: FL S0418 | 2023 | Regular Session | Enrolled

Bill Title: Insurance

Spectrum: Slight Partisan Bill (? 3-1)

Status: (Passed) 2023-06-16 - Chapter No. 2023-217, companion bill(s) passed, see CS/CS/HB 1185 (Ch. 2023-130) [S0418 Detail]

Download: Florida-2023-S0418-Enrolled.html
       2023 Legislature      CS for CS for CS for SB 418, 1st Engrossed
    2         An act relating to insurance; amending s. 327.54,
    3         F.S.; revising requirements relating to insurance for
    4         liveries that lease or rent or offer to lease or rent
    5         livery vessels; amending s. 624.4621, F.S.; specifying
    6         a qualification for a local governmental entity’s
    7         representative on a self-insurer’s governing body;
    8         amending s. 627.062, F.S.; authorizing residential
    9         property insurance rate filings to use a specified
   10         modeling indication; amending s. 627.0628, F.S.;
   11         revising membership requirements for specified members
   12         of the Florida Commission on Hurricane Loss Projection
   13         Methodology; amending s. 627.0629, F.S.; authorizing
   14         insurers to file with the Office of Insurance
   15         Regulation personal lines residential property
   16         insurance rating plans providing rate differentials
   17         based on certain windstorm mitigation construction
   18         standards; providing requirements for such plans;
   19         amending s. 627.0665, F.S.; revising the timeframe for
   20         advance notices from insurers to insureds of automatic
   21         bank withdrawal increases; specifying the increase
   22         threshold for such notices; amending s. 627.421, F.S.;
   23         revising the types of documents and kinds of insurance
   24         for which electronic transmission constitutes delivery
   25         to the insured or person entitled to delivery;
   26         deleting a requirement to include a certain notice to
   27         an insured electing to receive policy documents
   28         electronically; deleting a requirement to provide a
   29         paper copy of the policy upon request by such person;
   30         amending s. 627.701, F.S.; revising and specifying
   31         alternative hurricane deductible amounts for personal
   32         lines residential property insurance policies covering
   33         risks with specified dwelling limits; amending s.
   34         627.712, F.S.; providing that a policyholder’s written
   35         exclusion from residential windstorm coverage or
   36         contents coverage may be typed rather than
   37         handwritten; amending s. 627.7276, F.S.; revising the
   38         requirements for the notice of limited coverage under
   39         certain automobile policies; amending s. 634.041,
   40         F.S.; specifying the manner in which a contractual
   41         liability insurance policy of a service agreement
   42         company may pay claims; providing an effective date.
   44  Be It Enacted by the Legislature of the State of Florida:
   46         Section 1. Subsection (7) of section 327.54, Florida
   47  Statutes, is amended to read:
   48         327.54 Liveries; safety regulations; penalty.—
   49         (7) A livery may not lease or rent or offer to lease or
   50  rent any livery vessel unless the livery: first
   51         (a) Obtains and carries in full force and effect a policy
   52  from a licensed insurance carrier in this state which insures
   53  the livery and the renter against any accident, loss, injury,
   54  property damage, or other casualty caused by or resulting from
   55  the operation of the livery vessel. The insurance policy must
   56  provide coverage of at least $500,000 per person and $1 million
   57  per event. The livery shall have proof of such insurance
   58  available for inspection at the location where livery vessels
   59  are being leased or rented, or offered for lease or rent, and
   60  shall provide to each renter the insurance carrier’s name and
   61  address and the insurance policy number; and
   62         (b) Either:
   63         1. Obtains and carries in full force and effect a policy
   64  from a licensed insurance carrier in this state which insures
   65  the renter in the same manner and amounts of the policy obtained
   66  by the livery under paragraph (a) and provides to each renter
   67  the insurance carrier’s name and address and the insurance
   68  policy number; or
   69         2. Presents the renter with the opportunity to purchase
   70  coverage which insures the renter against any accident, loss,
   71  injury, property damage, or other casualty caused by or
   72  resulting from the operation of the livery vessel of at least
   73  $500,000 per person and $1 million per event. If a renter
   74  chooses not to purchase the coverage, the livery must obtain a
   75  signed acknowledgement from the renter which includes an
   76  attestation as to whether the renter has a Florida boating
   77  safety identification card issued by the commission, a temporary
   78  certificate, or another form of boating certification authorized
   79  pursuant to s. 327.395, and that includes the following
   80  statement:
   84         $500,000 PER PERSON AND $1 MILLION PER EVENT FOR ANY
   98  This subsection does not apply to human-powered vessels.
   99         Section 2. Subsection (12) is added to section 624.4621,
  100  Florida Statutes, to read:
  101         624.4621 Group self-insurance funds.—
  102         (12) For any local governmental entity that is a member of
  103  a self-insurer established under this section, only an elected
  104  official of the local governmental entity may be the local
  105  governmental entity’s representative on the self-insurer’s
  106  governing body.
  107         Section 3. Paragraph (j) of subsection (2) of section
  108  627.062, Florida Statutes, is amended to read:
  109         627.062 Rate standards.—
  110         (2) As to all such classes of insurance:
  111         (j) With respect to residential property insurance rate
  112  filings, the rate filing:
  113         1. Must account for mitigation measures undertaken by
  114  policyholders to reduce hurricane losses.
  115         2.May use a modeling indication that is the weighted or
  116  straight average of two or more hurricane loss projection models
  117  found by the Florida Commission on Hurricane Loss Projection
  118  Methodology to be accurate or reliable pursuant to s. 627.0628.
  120  The provisions of this subsection do not apply to workers’
  121  compensation, employer’s liability insurance, and motor vehicle
  122  insurance.
  123         Section 4. Paragraph (b) of subsection (2) of section
  124  627.0628, Florida Statutes, is amended to read:
  125         627.0628 Florida Commission on Hurricane Loss Projection
  126  Methodology; public records exemption; public meetings
  127  exemption.—
  128         (2) COMMISSION CREATED.—
  129         (b) The commission shall consist of the following 12
  130  members:
  131         1. The insurance consumer advocate.
  132         2. The senior employee of the State Board of Administration
  133  responsible for operations of the Florida Hurricane Catastrophe
  134  Fund.
  135         3. The Executive Director of the Citizens Property
  136  Insurance Corporation or the executive director’s designee. The
  137  executive director’s designee must be a full-time employee of
  138  the corporation and have actuarial science experience.
  139         4. The Director of the Division of Emergency Management or
  140  the director’s designee. The director’s designee must be a full
  141  time employee of the division.
  142         5. The actuary member of the Florida Hurricane Catastrophe
  143  Fund Advisory Council.
  144         6. An employee of the office who is an actuary responsible
  145  for property insurance rate filings and who is appointed by the
  146  director of the office.
  147         7. Five members appointed by the Chief Financial Officer,
  148  as follows:
  149         a. An actuary who is employed full time by a property and
  150  casualty insurer that was responsible for at least 1 percent of
  151  the aggregate statewide direct written premium for homeowner
  152  insurance in the calendar year preceding the member’s
  153  appointment to the commission.
  154         b. An expert in insurance finance who is a full-time member
  155  of the faculty of the State University System and who has a
  156  background in actuarial science.
  157         c. An expert in statistics who is a full-time member of the
  158  faculty of the State University System and who has a background
  159  in insurance.
  160         d. An expert in computer system design who is a full-time
  161  member of the faculty of the State University System.
  162         e. An expert in meteorology who is a full-time member of
  163  the faculty of the State University System and who specializes
  164  in hurricanes.
  165         8. A licensed professional structural engineer who is a
  166  full-time faculty member in the State University System and who
  167  has expertise in wind mitigation techniques. This appointment
  168  shall be made by the Governor.
  169         Section 5. Subsection (9) is added to section 627.0629,
  170  Florida Statutes, to read:
  171         627.0629 Residential property insurance; rate filings.—
  172         (9)An insurer may file with the office a personal lines
  173  residential property insurance rating plan that provides
  174  justified premium discounts, credits, or other rate
  175  differentials based on windstorm mitigation construction
  176  standards developed by an independent, nonprofit scientific
  177  research organization, if such standards meet the requirements
  178  of this section. Such plan must describe the manner in which the
  179  insurer will document the existence of the mitigation features
  180  and premium discounts, credits, or other rate differentials
  181  created under such plan.
  182         Section 6. Section 627.0665, Florida Statutes, is amended
  183  to read:
  184         627.0665 Automatic bank withdrawal agreements; notification
  185  required.—Any insurer licensed to issue insurance in the state
  186  who has an automatic bank withdrawal agreement with an insured
  187  party for the payment of insurance premiums for any type of
  188  insurance shall give the named insured at least 10 15 days
  189  advance written notice of any increase in policy premiums which
  190  results in the next automatic bank withdrawal being increased by
  191  more than $10. Such notice must be provided before prior to any
  192  automatic bank withdrawal containing the of an increased
  193  premium.
  194         Section 7. Subsection (1) of section 627.421, Florida
  195  Statutes, is amended to read:
  196         627.421 Delivery of policy.—
  197         (1) Subject to the insurer’s requirement as to payment of
  198  premium, every policy shall be mailed, delivered, or
  199  electronically transmitted to the insured or to the person
  200  entitled thereto not later than 60 days after the effectuation
  201  of coverage. Notwithstanding any other provision of law, an
  202  insurer may allow a policyholder of personal lines insurance to
  203  affirmatively elect delivery of the policy documents, including,
  204  but not limited to, policies, endorsements, notices, or
  205  documents, by electronic means in lieu of delivery by mail.
  206  Electronic transmission of a policy, related notices, and other
  207  documents for individual and group health insurance policies or
  208  certificates of coverage pursuant to parts VI and VII of this
  209  chapter, respectively; health maintenance contracts or
  210  certificates of coverage pursuant to part I of chapter 641;
  211  prepaid limited health service contracts pursuant to part I of
  212  chapter 636; and for commercial risks, including, but not
  213  limited to, workers’ compensation and employers’ liability,
  214  commercial automobile liability, commercial automobile physical
  215  damage, commercial lines residential property, commercial
  216  nonresidential property, farmowners insurance, and the types of
  217  commercial lines risks set forth in s. 627.062(3)(d),
  218  constitutes delivery to the insured or to the person entitled to
  219  delivery, unless the insured or the person entitled to delivery
  220  communicates to the insurer in writing or electronically that he
  221  or she does not agree to delivery by electronic means.
  222  Electronic transmission shall include a notice to the insured or
  223  to the person entitled to delivery of a policy of his or her
  224  right to receive the policy via United States mail rather than
  225  via electronic transmission. A paper copy of the policy shall be
  226  provided to the insured or to the person entitled to delivery at
  227  his or her request.
  228         Section 8. Paragraph (d) of subsection (3) of section
  229  627.701, Florida Statutes, is amended, and paragraph (a) of that
  230  subsection is republished, to read:
  231         627.701 Liability of insureds; coinsurance; deductibles.—
  232         (3)(a) Except as otherwise provided in this subsection,
  233  prior to issuing a personal lines residential property insurance
  234  policy, the insurer must offer alternative deductible amounts
  235  applicable to hurricane losses equal to $500, 2 percent, 5
  236  percent, and 10 percent of the policy dwelling limits, unless
  237  the specific percentage deductible is less than $500. The
  238  written notice of the offer shall specify the hurricane
  239  deductible to be applied in the event that the applicant or
  240  policyholder fails to affirmatively choose a hurricane
  241  deductible. The insurer must provide such policyholder with
  242  notice of the availability of the deductible amounts specified
  243  in this subsection in a form approved by the office in
  244  conjunction with each renewal of the policy. The failure to
  245  provide such notice constitutes a violation of this code but
  246  does not affect the coverage provided under the policy.
  247         (d) For the following policies, the following alternative
  248  deductible amounts are authorized:
  249         1. With respect to a policy covering a risk with dwelling
  250  limits of $250,000 or more, the insurer need not offer the $500
  251  hurricane deductible as required by paragraph (a), but must,
  252  except as otherwise provided in this subsection, offer the other
  253  hurricane deductibles as required by paragraph (a).
  254         2.With respect to a policy covering a risk with dwelling
  255  limits of $1 million or more, but less than $3 million, the
  256  insurer may, in lieu of offering the 2 percent deductible as
  257  required by paragraph (a), offer a deductible amount applicable
  258  to hurricane losses equal to 3 percent of the policy dwelling
  259  limits.
  260         3.With respect to a policy covering a risk with dwelling
  261  limits of $3 million or more, the insurer need not offer the 2
  262  percent deductible as required by paragraph (a), but must,
  263  except as otherwise provided by this subsection, offer the other
  264  hurricane deductibles as required by paragraph (a).
  265         Section 9. Paragraph (a) of subsection (2) and subsection
  266  (3) of section 627.712, Florida Statutes, are amended to read:
  267         627.712 Residential windstorm coverage required;
  268  availability of exclusions for windstorm or contents.—
  269         (2) A property insurer must make available, at the option
  270  of the policyholder, an exclusion of windstorm coverage.
  271         (a) The coverage may be excluded only if:
  272         1. When the policyholder is a natural person, the
  273  policyholder personally writes or types and provides to the
  274  insurer the following statement in his or her own handwriting
  275  and signs his or her name, which must also be signed by every
  276  other named insured on the policy, and dated: “I do not want the
  277  insurance on my (home/mobile home/condominium unit) to pay for
  278  damage from windstorms. I will pay those costs. My insurance
  279  will not.”
  280         2. When the policyholder is other than a natural person,
  281  the policyholder provides to the insurer on the policyholder’s
  282  letterhead the following statement that must be signed by the
  283  policyholder’s authorized representative and dated: “...(Name of
  284  entity)... does not want the insurance on its ...(type of
  285  structure)... to pay for damage from windstorms. ...(Name of
  286  entity)... will be responsible for these costs. ...(Name of
  287  entity’s)... insurance will not.”
  288         (3) An insurer issuing a residential property insurance
  289  policy, except for a condominium unit owner policy or a tenant
  290  policy, must make available, at the option of the policyholder,
  291  an exclusion of coverage for the contents. The coverage may be
  292  excluded only if the policyholder personally writes or types and
  293  provides to the insurer the following statement in his or her
  294  own handwriting and signs his or her signature, which must also
  295  be signed by every other named insured on the policy, and dated:
  296  “I do not want the insurance on my (home/mobile home) to pay for
  297  the costs to repair or replace any contents that are damaged. I
  298  will pay those costs. My insurance will not.”
  299         Section 10. Section 627.7276, Florida Statutes, is amended
  300  to read:
  301         627.7276 Notice of limited coverage.—
  302         (1) An automobile policy that does not contain coverage for
  303  bodily injury and property damage must include a notice be
  304  clearly stamped or printed to the effect that such coverage is
  305  not included in the policy in the following manner:
  311         RESPONSIBILITY LAW.”
  313         (2) This notice legend must appear on the policy
  314  declaration page and on the filing back of the policy and be
  315  printed in bold type a contrasting color from that used on the
  316  policy and in type larger than the largest type used in the text
  317  thereof, as an overprint or by a rubber stamp impression.
  318         Section 11. Paragraph (b) of subsection (8) of section
  319  634.041, Florida Statutes, is amended to read:
  320         634.041 Qualifications for license.—To qualify for and hold
  321  a license to issue service agreements in this state, a service
  322  agreement company must be in compliance with this part, with
  323  applicable rules of the commission, with related sections of the
  324  Florida Insurance Code, and with its charter powers and must
  325  comply with the following:
  326         (8)
  327         (b) A service agreement company does not have to establish
  328  and maintain an unearned premium reserve if it secures and
  329  maintains contractual liability insurance in accordance with the
  330  following:
  331         1. Coverage of 100 percent of the claim exposure is
  332  obtained from an insurer approved by the office, which holds a
  333  certificate of authority under s. 624.401 to do business within
  334  this state, or secured through a risk retention group, which is
  335  authorized to do business within this state under s. 627.943 or
  336  s. 627.944. Such insurer or risk retention group must maintain a
  337  surplus as regards policyholders of at least $15 million.
  338         2. If the service agreement company does not meet its
  339  contractual obligations, the contractual liability insurance
  340  policy binds its issuer to pay or cause to be paid to the
  341  service agreement holder all legitimate claims and cancellation
  342  refunds for all service agreements issued by the service
  343  agreement company while the policy was in effect. This
  344  requirement also applies to those service agreements for which
  345  no premium has been remitted to the insurer.
  346         3. If the issuer of the contractual liability policy is
  347  fulfilling the service agreements covered by the contractual
  348  liability policy and the service agreement holder cancels the
  349  service agreement, the issuer must make a full refund of
  350  unearned premium to the consumer, subject to the cancellation
  351  fee provisions of s. 634.121(3). The sales representative and
  352  agent must refund to the contractual liability policy issuer
  353  their unearned pro rata commission.
  354         4. The policy may not be canceled, terminated, or
  355  nonrenewed by the insurer or the service agreement company
  356  unless a 90-day written notice thereof has been given to the
  357  office by the insurer before the date of the cancellation,
  358  termination, or nonrenewal.
  359         5. The service agreement company must provide the office
  360  with the claims statistics.
  361         6.A policy issued in compliance with this paragraph may
  362  either pay 100 percent of claims as they are incurred or pay 100
  363  percent of claims due in the event of the failure of the service
  364  agreement company to pay such claims when due.
  366  All funds or premiums remitted to an insurer by a motor vehicle
  367  service agreement company under this part shall remain in the
  368  care, custody, and control of the insurer and shall be counted
  369  as an asset of the insurer; provided, however, this requirement
  370  does not apply when the insurer and the motor vehicle service
  371  agreement company are affiliated companies and members of an
  372  insurance holding company system. If the motor vehicle service
  373  agreement company chooses to comply with this paragraph but also
  374  maintains a reserve to pay claims, such reserve shall only be
  375  considered an asset of the covered motor vehicle service
  376  agreement company and may not be simultaneously counted as an
  377  asset of any other entity.
  378         Section 12. This act shall take effect July 1, 2023.