Bill Text: FL S0794 | 2017 | Regular Session | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Motor Vehicle Service Agreement Companies
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2017-05-03 - Laid on Table, companion bill(s) passed, see CS/HB 339 (Ch. 2017-99) [S0794 Detail]
Download: Florida-2017-S0794-Introduced.html
Bill Title: Motor Vehicle Service Agreement Companies
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2017-05-03 - Laid on Table, companion bill(s) passed, see CS/HB 339 (Ch. 2017-99) [S0794 Detail]
Download: Florida-2017-S0794-Introduced.html
Florida Senate - 2017 SB 794 By Senator Brandes 24-00941-17 2017794__ 1 A bill to be entitled 2 An act relating to motor vehicle service agreement 3 companies; amending s. 634.041, F.S.; revising 4 qualifications for a motor vehicle service agreement 5 company to obtain and maintain a license; providing an 6 effective date. 7 8 Be It Enacted by the Legislature of the State of Florida: 9 10 Section 1. Paragraph (b) of subsection (8) and paragraph 11 (a) of subsection (11) of section 634.041, Florida Statutes, are 12 amended to read: 13 634.041 Qualifications for license.—To qualify for and hold 14 a license to issue service agreements in this state, a service 15 agreement company must be in compliance with this part, with 16 applicable rules of the commission, with related sections of the 17 Florida Insurance Code, and with its charter powers and must 18 comply with the following: 19 (8) 20 (b) A service agreement company does not have to establish 21 and maintain an unearned premium reserve if it purchases and 22 maintains contractual liability insurance in accordance with the 23 following: 24 1. The insurance covers 100 percent of its claim exposure 25 and is obtained from an insurer approved by the office which 26 holds a certificate of authority under s. 624.401 or a risk 27 retention group that is authorized to do business within this 28 state under s. 627.943 or s. 627.944 and maintains a surplus to 29 policyholders of at least $15 million. 30 2. If the service agreement company does not meet its 31 contractual obligations, the contractual liability insurance 32 policy binds its issuer to pay or cause to be paid to the 33 service agreement holder all legitimate claims and cancellation 34 refunds for all service agreements issued by the service 35 agreement company while the policy was in effect. This 36 requirement also applies to those service agreements for which 37 no premium has been remitted to the insurer. 38 3. If the issuer of the contractual liability policy is 39 fulfilling the service agreements covered by the contractual 40 liability policy and the service agreement holder cancels the 41 service agreement, the issuer must make a full refund of 42 unearned premium to the consumer, subject to the cancellation 43 fee provisions of s. 634.121(3). The sales representative and 44 agent must refund to the contractual liability policy issuer 45 their unearned pro rata commission. 46 4. The policy may not be canceled, terminated, or 47 nonrenewed by the insurer or the service agreement company 48 unless a 90-day written notice thereof has been given to the 49 office by the insurer before the date of the cancellation, 50 termination, or nonrenewal. 51 5. The service agreement company must provide the office 52 with the claims statistics. 53 54 All funds or premiums remitted to an insurer by a motor vehicle 55 service agreement company under this part shall remain in the 56 care, custody, and control of the insurer and shall be counted 57 as an asset of the insurer; provided, however, this requirement 58 does not apply when the insurer and the motor vehicle service 59 agreement company are affiliated companies and members of an 60 insurance holding company system. If the motor vehicle service 61 agreement company chooses to comply with this paragraph but also 62 maintains a reserve to pay claims, such reserve shall only be 63 considered an asset of the covered motor vehicle service 64 agreement company and may not be simultaneously counted as an 65 asset of any other entity. 66 (11)(a) A service agreement company offering service 67 agreements providing vehicle protection expenses may meet the 68 requirements for this part only by maintaining contractual 69 liability insurance covering 100 percent of its vehicle 70 protection claim exposure in accordance with paragraph (8)(b),71which insurance must be issued by an insurance company not72affiliated with the service agreement company, unless the73insurance company had issued a contractual liability insurance74policy to a service agreement company on or before January 1,752002. Service agreements providing vehicle protection expenses 76 may be sold only to a service agreement holder that has in-force 77 comprehensive motor vehicle insurance coverage for the vehicle 78 to be covered by the service agreement. 79 Section 2. This act shall take effect July 1, 2017.