Bill Text: FL S0538 | 2019 | Regular Session | Comm Sub

Bill Title: Nonadmitted Insurance Market Reform

Spectrum: Bipartisan Bill

Status: (Failed) 2019-05-03 - Died in Appropriations [S0538 Detail]

Download: Florida-2019-S0538-Comm_Sub.html
       Florida Senate - 2019                              CS for SB 538
       By the Committee on Banking and Insurance; and Senator Brandes
       597-02928-19                                           2019538c1
    1                        A bill to be entitled                      
    2         An act relating to nonadmitted insurance market
    3         reform; amending s. 626.916, F.S.; deleting a
    4         limitation on per-policy fees charged by surplus lines
    5         agents for exporting certified policies; requiring
    6         that such fees be itemized separately for the customer
    7         before purchase and enumerated in the policy; amending
    8         s. 626.931, F.S.; deleting a requirement for surplus
    9         lines agents to quarterly file a certain affidavit
   10         with the Florida Surplus Lines Service Office;
   11         amending s. 626.932, F.S.; conforming a provision to
   12         changes made by the act; amending ss. 626.935 and
   13         629.401, F.S.; conforming provisions to changes made
   14         by the act; amending s. 627.715, F.S.; extending the
   15         expiration date of a provision authorizing surplus
   16         lines agents to export contracts or endorsements
   17         providing flood coverage to eligible surplus lines
   18         insurers without making a certain diligent effort to
   19         seek coverage from authorized insurers; providing an
   20         effective date.
   22  Be It Enacted by the Legislature of the State of Florida:
   24         Section 1. Subsection (4) of section 626.916, Florida
   25  Statutes, is amended to read:
   26         626.916 Eligibility for export.—
   27         (4) A reasonable per-policy fee, not to exceed $35, may be
   28  charged by the filing surplus lines agent for each policy
   29  certified for export. The fee must be itemized separately for
   30  the customer before purchase and enumerated in the policy.
   31         Section 2. Section 626.931, Florida Statutes, is amended to
   32  read:
   33         626.931 Agent affidavit and Insurer reporting
   34  requirements.—
   35         (1) Each surplus lines agent that has transacted business
   36  during a calendar quarter shall on or before the 45th day
   37  following the calendar quarter file with the Florida Surplus
   38  Lines Service Office an affidavit, on forms as prescribed and
   39  furnished by the Florida Surplus Lines Service Office, stating
   40  that all surplus lines insurance transacted by him or her during
   41  such calendar quarter has been submitted to the Florida Surplus
   42  Lines Service Office as required.
   43         (2) The affidavit of the surplus lines agent shall include
   44  efforts made to place coverages with authorized insurers and the
   45  results thereof.
   46         (1)(3) Each foreign insurer accepting premiums shall, on or
   47  before the end of the month following each calendar quarter,
   48  file with the Florida Surplus Lines Service Office a verified
   49  report of all surplus lines insurance transacted by such insurer
   50  for insurance risks located in this state during such calendar
   51  quarter.
   52         (2)(4) Each alien insurer accepting premiums shall, on or
   53  before June 30 of each year, file with the Florida Surplus Lines
   54  Service Office a verified report of all surplus lines insurance
   55  transacted by such insurer for insurance risks located in this
   56  state during the preceding calendar year.
   57         (3)(5) The department may waive the filing requirements
   58  described in subsections (1) (3) and (2) (4).
   59         (4)(6) Each insurer’s report and supporting information
   60  shall be in a computer-readable format as determined by the
   61  Florida Surplus Lines Service Office or shall be submitted on
   62  forms prescribed by the Florida Surplus Lines Service Office and
   63  shall show for each applicable agent:
   64         (a) A listing of all policies, certificates, cover notes,
   65  or other forms of confirmation of insurance coverage or any
   66  substitutions thereof or endorsements thereto and the
   67  identifying number; and
   68         (b) Any additional information required by the department
   69  or Florida Surplus Lines Service Office.
   70         Section 3. Paragraph (a) of subsection (2) of section
   71  626.932, Florida Statutes, is amended to read:
   72         626.932 Surplus lines tax.—
   73         (2)(a) The surplus lines agent shall make payable to the
   74  department the tax related to each calendar quarter’s business
   75  as reported to the Florida Surplus Lines Service Office, and
   76  remit the tax to the Florida Surplus Lines Service Office at the
   77  same time as the remittance required under s. 626.9325 provided
   78  for the filing of the quarterly affidavit, under s. 626.931. The
   79  Florida Surplus Lines Service Office shall forward to the
   80  department the taxes and any interest collected pursuant to
   81  paragraph (b), within 10 days of receipt.
   82         Section 4. Paragraph (d) of subsection (1) of section
   83  626.935, Florida Statutes, is amended, and present paragraphs
   84  (e) through (i) of subsection (1) of that section are
   85  redesignated as paragraphs (d) through (h), respectively, to
   86  read:
   87         626.935 Suspension, revocation, or refusal of surplus lines
   88  agent’s license.—
   89         (1) The department shall deny an application for, suspend,
   90  revoke, or refuse to renew the appointment of a surplus lines
   91  agent and all other licenses and appointments held by the
   92  licensee under this code, on any of the following grounds:
   93         (d) Failure to make and file his or her affidavit or
   94  reports when due as required by s. 626.931.
   95         Section 5. Paragraph (a) of subsection (1) of section
   96  629.401, Florida Statutes, is amended to read:
   97         629.401 Insurance exchange.—
   98         (1) There may be created one or more insurance exchanges,
   99  with one or more offices each, subject to such rules as are
  100  adopted by the commission. For the purposes of this section, the
  101  term “exchange” applies to any such insurance exchange proposed
  102  or created under this section. The purposes of the exchange are:
  103         (a) To provide a facility for the underwriting of:
  104         1. Reinsurance of all kinds of insurance.
  105         2. Direct insurance of all kinds on risks located entirely
  106  outside the United States.
  107         3. Surplus lines insurance for risks located in this state
  108  eligible for export under s. 626.916 or s. 626.917 and placed
  109  through a licensed Florida surplus lines agent subject to
  110  compliance with the provisions of ss. 626.921, 626.922, 626.923,
  111  626.924, 626.929, 626.9295, and 626.930, and 626.931. With
  112  respect to compliance with s. 626.924, the required legend may
  113  refer to any coverage provided for by a security fund
  114  established under paragraph (3)(d).
  115         4. Surplus lines insurance in any other state subject to
  116  the applicable surplus lines laws of such other state for risks
  117  located entirely outside of this state.
  118         Section 6. Subsection (4) of section 627.715, Florida
  119  Statutes, is amended to read:
  120         627.715 Flood insurance.—An authorized insurer may issue an
  121  insurance policy, contract, or endorsement providing personal
  122  lines residential coverage for the peril of flood or excess
  123  coverage for the peril of flood on any structure or the contents
  124  of personal property contained therein, subject to this section.
  125  This section does not apply to commercial lines residential or
  126  commercial lines nonresidential coverage for the peril of flood.
  127  An insurer may issue flood insurance policies, contracts,
  128  endorsements, or excess coverage on a standard, preferred,
  129  customized, flexible, or supplemental basis.
  130         (4) A surplus lines agent may export a contract or
  131  endorsement providing flood coverage to an eligible surplus
  132  lines insurer without making a diligent effort to seek such
  133  coverage from three or more authorized insurers under s.
  134  626.916(1)(a). This subsection expires July 1, 2025 2019, or on
  135  the date on which the Commissioner of Insurance Regulation
  136  determines in writing that there is an adequate admitted market
  137  to provide coverage for the peril of flood consistent with this
  138  section, whichever date occurs first. If there are fewer than
  139  three admitted insurers on the date this subsection expires, the
  140  number of declinations necessary to meet the diligent-effort
  141  requirement shall be no fewer than the number of authorized
  142  insurers providing flood coverage.
  143         Section 7. This act shall take effect July 1, 2019.