Bill Text: FL S1046 | 2013 | Regular Session | Comm Sub

Bill Title: Insurance

Spectrum: Slight Partisan Bill (? 2-1)

Status: (Failed) 2013-04-26 - Laid on Table, companion bill(s) passed, see CS/HB 157 (Ch. 2013-190), CS/HB 1191 (Ch. 2013-209), CS/CS/HB 7125 (Ch. 2013-160), SB 356 (Ch. 2013-125), CS/CS/SB 468 (Ch. 2013-66), CS/SB 1842 (Ch. 2013-101) [S1046 Detail]

Download: Florida-2013-S1046-Comm_Sub.html
       Florida Senate - 2013                      CS for CS for SB 1046
       By the Committees on Appropriations; and Banking and Insurance;
       and Senator Brandes
       576-04646-13                                          20131046c2
    1                        A bill to be entitled                      
    2         An act relating to insurance; amending s. 215.555,
    3         F.S.; postponing the date that repeals the Florida
    4         Hurricane Catastrophe Fund emergency assessment
    5         exemption for medical malpractice insurance premiums;
    6         amending s. 316.646, F.S.; authorizing a uniform motor
    7         vehicle proof-of-insurance card to be in an electronic
    8         format; providing construction with respect to the
    9         parameters of a person’s consent to access information
   10         on an electronic device presented to provide proof of
   11         insurance; providing immunity from liability to a law
   12         enforcement officer for damage to an electronic device
   13         presented to provide proof of insurance; authorizing
   14         the Department of Highway Safety and Motor Vehicles to
   15         adopt rules; amending s. 320.02, F.S.; authorizing
   16         insurers to furnish uniform proof-of-purchase cards in
   17         an electronic format for use by insureds to prove the
   18         purchase of required insurance coverage when
   19         registering a motor vehicle; amending s. 554.1021,
   20         F.S.; defining the term “authorized inspection
   21         agency”; amending s. 554.107, F.S.; requiring the
   22         chief inspector of the state boiler inspection program
   23         to issue a certificate of competency as a special
   24         inspector to certain individuals; specifying how long
   25         such certificate remains in effect; amending s.
   26         554.109, F.S.; authorizing specified insurers to
   27         contract with an authorized inspection agency for
   28         boiler inspections; requiring such insurers to
   29         annually report the identity of contracted authorized
   30         inspection agencies to the Department of Financial
   31         Services; amending s. 624.413, F.S.; revising a
   32         specified time period applicable to a certified
   33         examination that must be filed by a foreign or alien
   34         insurer applying for a certificate of authority;
   35         amending s. 626.0428, F.S.; requiring each insurance
   36         agency to be under the control of an agent licensed to
   37         transact certain lines of insurance; authorizing an
   38         agent to be in charge of more than one branch office
   39         under certain circumstances; providing requirements
   40         relating to the designation of an agent in charge;
   41         prohibiting an insurance agency from conducting
   42         insurance business at a location without a designated
   43         agent in charge; providing a definition for the term
   44         “agent in charge”; providing that the designated agent
   45         in charge is liable for certain acts of misconduct;
   46         providing grounds for the Department of Financial
   47         Services to order operations to cease at certain
   48         insurance agency locations until an agent in charge is
   49         properly designated; amending s. 626.112, F.S.;
   50         providing licensure exemptions that allow specified
   51         individuals or entities to conduct insurance business
   52         at specified locations under certain circumstances;
   53         revising licensure requirements and penalties with
   54         respect to registered insurance agencies; providing
   55         that the registration of an approved registered
   56         insurance agency automatically converts to an
   57         insurance agency license on a specified date; amending
   58         s. 626.172, F.S.; revising requirements relating to
   59         applications for insurance agency licenses; conforming
   60         provisions to changes made by the act; amending s.
   61         626.321, F.S.; providing that a limited license to
   62         offer motor vehicle rental insurance issued to a
   63         business that rents or leases motor vehicles
   64         encompasses the employees of such business; amending
   65         s. 626.382, F.S.; providing that an insurance agency
   66         license continues in force until canceled, suspended,
   67         revoked, or terminated; amending s. 626.601, F.S.;
   68         revising terminology relating to investigations
   69         conducted by the Department of Financial Services and
   70         the Office of Insurance Regulation with respect to
   71         individuals and entities involved in the insurance
   72         industry; repealing s. 626.747, F.S., relating to
   73         branch agencies, agents in charge, and the payment of
   74         additional county tax under certain circumstances;
   75         amending s. 626.8411, F.S.; conforming a cross
   76         reference; amending s. 626.8805, F.S.; revising
   77         insurance administrator application requirements;
   78         amending s. 626.8817, F.S.; authorizing an insurer’s
   79         designee to provide certain coverage information to an
   80         insurance administrator; authorizing an insurer to
   81         subcontract the audit of an insurance administrator;
   82         amending s. 626.882, F.S.; prohibiting a person from
   83         acting as an insurance administrator without a
   84         specific written agreement; amending s. 626.883, F.S.;
   85         requiring insurance administrators to furnish
   86         fiduciary account records to an insurer’s designee;
   87         providing that administrator withdrawals from a
   88         fiduciary account be made according to specific
   89         written agreements; providing that an insurer’s
   90         designee may authorize payment of claims; amending s.
   91         626.884, F.S.; revising an insurer’s right of access
   92         to certain administrator records; amending s. 626.89,
   93         F.S.; revising the deadline for filing certain
   94         financial statements; amending s. 626.931, F.S.;
   95         deleting provisions requiring a surplus lines agent to
   96         file a quarterly affidavit with the Florida Surplus
   97         Lines Service Office; amending s. 626.932, F.S.;
   98         revising the due date of surplus lines tax; amending
   99         s. 626.935, F.S.; conforming provisions to changes
  100         made by the act; amending s. 626.936, F.S.; conforming
  101         provisions to changes made by the act; amending s.
  102         627.062, F.S.; requiring the Office of Insurance
  103         Regulation to use certain models or straight averages
  104         of certain models to estimate hurricane losses when
  105         determining whether the rates in a rate filing are
  106         excessive, inadequate, or unfairly discriminatory;
  107         amending s. 627.0628, F.S.; increasing the length of
  108         time during which an insurer must adhere to certain
  109         findings made by the Commission on Hurricane Loss
  110         Projection Methodology with respect to certain
  111         methods, principles, standards, models, or output
  112         ranges used in a rate finding; providing that the
  113         requirement to adhere to such findings does not limit
  114         an insurer from using a straight average of results of
  115         certain models or output ranges under specified
  116         circumstances; amending s. 627.072, F.S.; authorizing
  117         retrospective rating plans relating to workers’
  118         compensation and employer’s liability insurance to
  119         allow negotiations between certain employers and
  120         insurers with respect to rating factors used to
  121         calculate premiums; amending s. 627.281, F.S.;
  122         conforming a cross-reference; amending s. 627.351,
  123         F.S.; requiring Citizens Property Insurance
  124         Corporation to submit a biannual report on the number
  125         of residential sinkhole policies issued and declined;
  126         providing legislative intent; establishing a Citizens
  127         Sinkhole Stabilization Repair Program for sinkhole
  128         claims; providing definitions; providing program
  129         components; specifying the corporation’s liability
  130         with respect to sinkhole claims; requiring the
  131         corporation to offer specified deductible amounts for
  132         sinkhole loss coverage; amending s. 627.3519, F.S.;
  133         requiring the Florida Hurricane Catastrophe Fund and
  134         Citizens Property Insurance Corporation to provide an
  135         annual report to the Legislature and the Financial
  136         Services Commission of their respective aggregate net
  137         probable maximum losses, financing options, and
  138         potential assessments; amending s. 627.4133, F.S.;
  139         increasing the amount of prior notice required with
  140         respect to the nonrenewal, cancellation, or
  141         termination of certain insurance policies; deleting
  142         certain provisions that require extended periods of
  143         prior notice with respect to the nonrenewal,
  144         cancellation, or termination of certain insurance
  145         policies; prohibiting the cancellation of certain
  146         policies that have been in effect for a specified
  147         amount of time except under certain circumstances;
  148         amending s. 627.4137, F.S.; adding licensed company
  149         adjusters to the list of persons who may respond to a
  150         claimant’s written request for information relating to
  151         liability insurance coverage; amending s. 627.421,
  152         F.S.; authorizing the electronic delivery of certain
  153         insurance documents; amending s. 627.43141, F.S.;
  154         authorizing a notice of change in policy terms to be
  155         sent in a separate mailing to an insured under certain
  156         circumstances; requiring an insurer to provide such
  157         notice to the insured’s insurance agent; amending s.
  158         627.6484, F.S.; providing that coverage for each
  159         policyholder of the Florida Comprehensive Health
  160         Association terminates on a specified date; requiring
  161         the association to provide assistance to
  162         policyholders; requiring the association to notify
  163         policyholders of termination of coverage and provide
  164         information concerning how to obtain other coverage;
  165         requiring the association to impose a final assessment
  166         or provide a refund to member insurers, sell or
  167         dispose of physical assets, perform a final
  168         accounting, legally dissolve the association, submit a
  169         required report, and transfer all records to the
  170         Department of Financial Services; repealing s.
  171         627.64872, F.S., relating to the Florida Health
  172         Insurance Plan; providing for the future repeal of ss.
  173         627.648, 627.6482, 627.6484, 627.6486, 627.6488,
  174         627.6489, 627.649, 627.6492, 627.6494, 627.6496,
  175         627.6498, and 627.6499, F.S., relating to the Florida
  176         Comprehensive Health Association Act, definitions,
  177         termination of enrollment and availability of other
  178         coverage, eligibility, the Florida Comprehensive
  179         Health Association, the Disease Management Program,
  180         the administrator of the health insurance plan,
  181         participation of insurers, insurer assessments,
  182         deferment, and assessment limitations, issuing of
  183         policies, minimum benefits coverage and exclusions,
  184         premiums, and deductibles, and reporting by insurers
  185         and third-party administrators, respectively; amending
  186         s. 627.7015, F.S.; revising the rulemaking authority
  187         of the department with respect to qualifications and
  188         specified types of penalties covered under the
  189         property insurance mediation program; creating s.
  190         627.70151, F.S.; providing criteria for an insurer or
  191         policyholder to challenge the impartiality of a loss
  192         appraisal umpire for purposes of disqualifying such
  193         umpire; amending s. 627.706, F.S.; revising the
  194         definition of the term “neutral evaluator”; amending
  195         s. 627.7074, F.S.; requiring the department to adopt
  196         rules relating to the certification of neutral
  197         evaluators; amending s. 627.736, F.S.; revising the
  198         time period for applicability of certain Medicare fee
  199         schedules or payment limitations; amending s. 627.745,
  200         F.S.; revising qualifications for approval as a
  201         mediator by the department; providing grounds for the
  202         department to deny an application, or suspend or
  203         revoke approval of a mediator or certification of a
  204         neutral evaluator; authorizing the department to adopt
  205         rules; amending s. 627.841, F.S.; providing that an
  206         insurance premium finance company may impose a fee for
  207         payments returned due to insufficient funds; amending
  208         s. 627.952, F.S.; providing that certain persons who
  209         are not residents of this state must be licensed and
  210         appointed as nonresident surplus lines agents in this
  211         state in order to engage in specified activities with
  212         respect to servicing insurance contracts,
  213         certificates, or agreements for purchasing or risk
  214         retention groups; deleting a fidelity bond requirement
  215         applicable to certain nonresident agents who are
  216         licensed as surplus lines agents in another state;
  217         amending ss. 627.971 and 627.972, F.S.; including
  218         licensed mutual insurers in financial guaranty
  219         insurance corporations; amending s. 628.901, F.S.;
  220         revising the definition of the term “qualifying
  221         reinsurer parent company”; amending s. 628.909, F.S.;
  222         providing for applicability of certain provisions of
  223         the Insurance Code to specified captive insurers;
  224         amending s. 634.406, F.S.; revising criteria
  225         authorizing premiums of certain service warranty
  226         associations to exceed their specified net assets
  227         limitations; revising requirements relating to
  228         contractual liability policies that insure warranty
  229         associations; providing an effective date.
  231  Be It Enacted by the Legislature of the State of Florida:
  233         Section 1. Paragraph (b) of subsection (6) of section
  234  215.555, Florida Statutes, is amended to read:
  235         215.555 Florida Hurricane Catastrophe Fund.—
  236         (6) REVENUE BONDS.—
  237         (b) Emergency assessments—
  238         1. If the board determines that the amount of revenue
  239  produced under subsection (5) is insufficient to fund the
  240  obligations, costs, and expenses of the fund and the
  241  corporation, including repayment of revenue bonds and that
  242  portion of the debt service coverage not met by reimbursement
  243  premiums, the board shall direct the Office of Insurance
  244  Regulation to levy, by order, an emergency assessment on direct
  245  premiums for all property and casualty lines of business in this
  246  state, including property and casualty business of surplus lines
  247  insurers regulated under part VIII of chapter 626, but not
  248  including any workers’ compensation premiums or medical
  249  malpractice premiums. As used in this subsection, the term
  250  “property and casualty business” includes all lines of business
  251  identified on Form 2, Exhibit of Premiums and Losses, in the
  252  annual statement required of authorized insurers by s. 624.424
  253  and any rule adopted under this section, except for those lines
  254  identified as accident and health insurance and except for
  255  policies written under the National Flood Insurance Program. The
  256  assessment shall be specified as a percentage of direct written
  257  premium and is subject to annual adjustments by the board in
  258  order to meet debt obligations. The same percentage applies
  259  shall apply to all policies in lines of business subject to the
  260  assessment issued or renewed during the 12-month period
  261  beginning on the effective date of the assessment.
  262         2. A premium is not subject to an annual assessment under
  263  this paragraph in excess of 6 percent of premium with respect to
  264  obligations arising out of losses attributable to any one
  265  contract year, and a premium is not subject to an aggregate
  266  annual assessment under this paragraph in excess of 10 percent
  267  of premium. An annual assessment under this paragraph continues
  268  shall continue as long as the revenue bonds issued with respect
  269  to which the assessment was imposed are outstanding, including
  270  any bonds the proceeds of which were used to refund the revenue
  271  bonds, unless adequate provision has been made for the payment
  272  of the bonds under the documents authorizing issuance of the
  273  bonds.
  274         3. Emergency assessments shall be collected from
  275  policyholders. Emergency assessments shall be remitted by
  276  insurers as a percentage of direct written premium for the
  277  preceding calendar quarter as specified in the order from the
  278  Office of Insurance Regulation. The office shall verify the
  279  accurate and timely collection and remittance of emergency
  280  assessments and shall report the information to the board in a
  281  form and at a time specified by the board. Each insurer
  282  collecting assessments shall provide the information with
  283  respect to premiums and collections as may be required by the
  284  office to enable the office to monitor and verify compliance
  285  with this paragraph.
  286         4. With respect to assessments of surplus lines premiums,
  287  each surplus lines agent shall collect the assessment at the
  288  same time as the agent collects the surplus lines tax required
  289  by s. 626.932, and the surplus lines agent shall remit the
  290  assessment to the Florida Surplus Lines Service Office created
  291  by s. 626.921 at the same time as the agent remits the surplus
  292  lines tax to the Florida Surplus Lines Service Office. The
  293  emergency assessment on each insured procuring coverage and
  294  filing under s. 626.938 shall be remitted by the insured to the
  295  Florida Surplus Lines Service Office at the time the insured
  296  pays the surplus lines tax to the Florida Surplus Lines Service
  297  Office. The Florida Surplus Lines Service Office shall remit the
  298  collected assessments to the fund or corporation as provided in
  299  the order levied by the Office of Insurance Regulation. The
  300  Florida Surplus Lines Service Office shall verify the proper
  301  application of such emergency assessments and shall assist the
  302  board in ensuring the accurate and timely collection and
  303  remittance of assessments as required by the board. The Florida
  304  Surplus Lines Service Office shall annually calculate the
  305  aggregate written premium on property and casualty business,
  306  other than workers’ compensation and medical malpractice,
  307  procured through surplus lines agents and insureds procuring
  308  coverage and filing under s. 626.938 and shall report the
  309  information to the board in a form and at a time specified by
  310  the board.
  311         5. Any assessment authority not used for a particular
  312  contract year may be used for a subsequent contract year. If,
  313  for a subsequent contract year, the board determines that the
  314  amount of revenue produced under subsection (5) is insufficient
  315  to fund the obligations, costs, and expenses of the fund and the
  316  corporation, including repayment of revenue bonds and that
  317  portion of the debt service coverage not met by reimbursement
  318  premiums, the board shall direct the Office of Insurance
  319  Regulation to levy an emergency assessment up to an amount not
  320  exceeding the amount of unused assessment authority from a
  321  previous contract year or years, plus an additional 4 percent
  322  provided that the assessments in the aggregate do not exceed the
  323  limits specified in subparagraph 2.
  324         6. The assessments otherwise payable to the corporation
  325  under this paragraph shall be paid to the fund unless and until
  326  the Office of Insurance Regulation and the Florida Surplus Lines
  327  Service Office have received a notice from the corporation and
  328  the fund a notice, which shall be conclusive and upon which they
  329  may rely without further inquiry, that the corporation has
  330  issued bonds and the fund has no agreements in effect with local
  331  governments under paragraph (c). On or after the date of the
  332  notice and until the date the corporation has no bonds
  333  outstanding, the fund shall have no right, title, or interest in
  334  or to the assessments, except as provided in the fund’s
  335  agreement with the corporation.
  336         7. Emergency assessments are not premium and are not
  337  subject to the premium tax, to the surplus lines tax, to any
  338  fees, or to any commissions. An insurer is liable for all
  339  assessments that it collects and must treat the failure of an
  340  insured to pay an assessment as a failure to pay the premium. An
  341  insurer is not liable for uncollectible assessments.
  342         8. If When an insurer is required to return an unearned
  343  premium, it shall also return any collected assessment
  344  attributable to the unearned premium. A credit adjustment to the
  345  collected assessment may be made by the insurer with regard to
  346  future remittances that are payable to the fund or corporation,
  347  but the insurer is not entitled to a refund.
  348         9. If When a surplus lines insured or an insured who has
  349  procured coverage and filed under s. 626.938 is entitled to the
  350  return of an unearned premium, the Florida Surplus Lines Service
  351  Office shall provide a credit or refund to the agent or such
  352  insured for the collected assessment attributable to the
  353  unearned premium before prior to remitting the emergency
  354  assessment collected to the fund or corporation.
  355         10. The exemption of medical malpractice insurance premiums
  356  from emergency assessments under this paragraph is repealed May
  357  31, 2016 2013, and medical malpractice insurance premiums shall
  358  be subject to emergency assessments attributable to loss events
  359  occurring in the contract years commencing on June 1, 2016 2013.
  360         Section 2. Subsection (1) of section 316.646, Florida
  361  Statutes, is amended, and subsection (5) is added to that
  362  section, to read:
  363         316.646 Security required; proof of security and display
  364  thereof; dismissal of cases.—
  365         (1) A Any person required by s. 324.022 to maintain
  366  property damage liability security, required by s. 324.023 to
  367  maintain liability security for bodily injury or death, or
  368  required by s. 627.733 to maintain personal injury protection
  369  security on a motor vehicle shall have in his or her immediate
  370  possession at all times while operating such motor vehicle
  371  proper proof of maintenance of the required security. Such proof
  372  shall be a uniform proof-of-insurance card, in paper or
  373  electronic format, in a form prescribed by the department, a
  374  valid insurance policy, an insurance policy binder, a
  375  certificate of insurance, or such other proof as may be
  376  prescribed by the department. If a person presents an electronic
  377  device to a law enforcement officer for the purpose of
  378  displaying a proof-of-insurance card in an electronic format:
  379         (a) The person presenting the device is not deemed to
  380  consent to access to any information on the electronic device
  381  other than the displayed proof-of-insurance card.
  382         (b) The law enforcement officer is not liable for damage to
  383  the electronic device.
  384         (5) The department may adopt rules to implement this
  385  section.
  386         Section 3. Paragraph (a) of subsection (5) of section
  387  320.02, Florida Statutes, is amended to read:
  388         320.02 Registration required; application for registration;
  389  forms.—
  390         (5)(a) Proof that personal injury protection benefits have
  391  been purchased when required under s. 627.733, that property
  392  damage liability coverage has been purchased as required under
  393  s. 324.022, that bodily injury or death coverage has been
  394  purchased if required under s. 324.023, and that combined bodily
  395  liability insurance and property damage liability insurance have
  396  been purchased when required under s. 627.7415 shall be provided
  397  in the manner prescribed by law by the applicant at the time of
  398  application for registration of any motor vehicle that is
  399  subject to such requirements. The issuing agent shall refuse to
  400  issue registration if such proof of purchase is not provided.
  401  Insurers shall furnish uniform proof-of-purchase cards, in paper
  402  or electronic format, in a form prescribed by the department and
  403  shall include the name of the insured’s insurance company, the
  404  coverage identification number, and the make, year, and vehicle
  405  identification number of the vehicle insured. The card must
  406  shall contain a statement notifying the applicant of the penalty
  407  specified in s. 316.646(4). The card or insurance policy,
  408  insurance policy binder, or certificate of insurance or a
  409  photocopy of any of these; an affidavit containing the name of
  410  the insured’s insurance company, the insured’s policy number,
  411  and the make and year of the vehicle insured; or such other
  412  proof as may be prescribed by the department constitutes shall
  413  constitute sufficient proof of purchase. If an affidavit is
  414  provided as proof, it must shall be in substantially the
  415  following form:
  417  Under penalty of perjury, I ...(Name of insured)... do hereby
  418  certify that I have ...(Personal Injury Protection, Property
  419  Damage Liability, and, when required, Bodily Injury
  420  Liability)... Insurance currently in effect with ...(Name of
  421  insurance company)... under ...(policy number)... covering
  422  ...(make, year, and vehicle identification number of
  423  vehicle).... ...(Signature of Insured)...
  425  Such affidavit shall include the following warning:
  432  When an application is made through a licensed motor vehicle
  433  dealer as required in s. 319.23, the original or a photostatic
  434  copy of such card, insurance policy, insurance policy binder, or
  435  certificate of insurance or the original affidavit from the
  436  insured shall be forwarded by the dealer to the tax collector of
  437  the county or the Department of Highway Safety and Motor
  438  Vehicles for processing. By executing the aforesaid affidavit,
  439  no licensed motor vehicle dealer will be liable in damages for
  440  any inadequacy, insufficiency, or falsification of any statement
  441  contained therein. A card shall also indicate the existence of
  442  any bodily injury liability insurance voluntarily purchased.
  443         Section 4. Subsection (8) is added to section 554.1021,
  444  Florida Statutes, to read:
  445         554.1021 Definitions.—As used in ss. 554.1011-554.115:
  446         (8) “Authorized inspection agency” means:
  447         (a) A county, city, town, or other governmental subdivision
  448  that has adopted and administers, at a minimum, Section I of the
  449  A.S.M.E. Boiler and Pressure Vessel Code as a legal requirement
  450  and whose inspectors hold valid certificates of competency in
  451  accordance with s. 554.113; or
  452         (b) An insurance company that is licensed or registered by
  453  an appropriate authority of any state of the United States or
  454  province of Canada and whose inspectors hold valid certificates
  455  of competency in accordance with s. 554.113.
  456         Section 5. Section 554.107, Florida Statutes, is amended to
  457  read:
  458         554.107 Special inspectors.—
  459         (1) Upon application by any an authorized inspection agency
  460  company licensed to insure boilers in this state, the chief
  461  inspector shall issue a certificate of competency as a special
  462  inspector to an any inspector employed by the agency if he or
  463  she company, provided that such inspector satisfies the
  464  competency requirements for inspectors as provided in s.
  465  554.113.
  466         (2) The certificate of competency of a special inspector
  467  remains shall remain in effect only so long as the special
  468  inspector is employed by an authorized inspection agency a
  469  company licensed to insure boilers in this state. Upon
  470  termination of employment with such agency company, a special
  471  inspector shall, in writing, notify the chief inspector of such
  472  termination. Such notice shall be given within 15 days following
  473  the date of termination.
  474         Section 6. Subsection (1) of section 554.109, Florida
  475  Statutes, is amended to read:
  476         554.109 Exemptions.—
  477         (1) An Any insurance company that insures insuring a boiler
  478  located in a public assembly location in this state shall
  479  inspect or contract with an authorized inspection agency to
  480  inspect such boiler so insured, and shall annually report to the
  481  department the identity of the authorized inspection agency that
  482  performs a required boiler inspection on behalf of the company.
  483  A any county, city, town, or other governmental subdivision that
  484  which has adopted into law the Boiler and Pressure Vessel Code
  485  of the American Society of Mechanical Engineers and the National
  486  Board Inspection Code for the construction, installation,
  487  inspection, maintenance, and repair of boilers, regulating such
  488  boilers in public assembly locations, shall inspect such boilers
  489  so regulated; provided that such inspection shall be conducted
  490  by a special inspector licensed pursuant to ss. 554.1011
  491  554.115. Upon filing of a report of satisfactory inspection with
  492  the department, such boiler is exempt from inspection by the
  493  department.
  494         Section 7. Paragraph (f) of subsection (1) of section
  495  624.413, Florida Statutes, is amended to read:
  496         624.413 Application for certificate of authority.—
  497         (1) To apply for a certificate of authority, an insurer
  498  shall file its application therefor with the office, upon a form
  499  adopted by the commission and furnished by the office, showing
  500  its name; location of its home office and, if an alien insurer,
  501  its principal office in the United States; kinds of insurance to
  502  be transacted; state or country of domicile; and such additional
  503  information as the commission reasonably requires, together with
  504  the following documents:
  505         (f) If a foreign or alien insurer, a copy of the report of
  506  the most recent examination of the insurer certified by the
  507  public official having supervision of insurance in its state of
  508  domicile or of entry into the United States. The end of the most
  509  recent year covered by the examination must be within the 5-year
  510  3-year period preceding the date of application. In lieu of the
  511  certified examination report, the office may accept an audited
  512  certified public accountant’s report prepared on a basis
  513  consistent with the insurance laws of the insurer’s state of
  514  domicile, certified by the public official having supervision of
  515  insurance in its state of domicile or of entry into the United
  516  States.
  517         Section 8. Subsection (4) is added to section 626.0428,
  518  Florida Statutes, to read:
  519         626.0428 Agency personnel powers, duties, and limitations.—
  520         (4)(a) Each place of business established by an agent or
  521  agency, firm, corporation, or association must be in the active
  522  full-time charge of a licensed and appointed agent holding the
  523  required agent licenses to transact the lines of insurance being
  524  handled at the location.
  525         (b) Notwithstanding paragraph (a), the licensed agent in
  526  charge of an insurance agency may also be the agent in charge of
  527  additional branch office locations of the agency if insurance
  528  activities requiring licensure as an insurance agent do not
  529  occur at any location when the agent is not physically present
  530  and unlicensed employees at the location do not engage in
  531  insurance activities requiring licensure as an insurance agent
  532  or customer representative.
  533         (c) An insurance agency and each branch place of business
  534  of an insurance agency shall designate an agent in charge and
  535  file the name and license number of the agent in charge and the
  536  physical address of the insurance agency location with the
  537  department at the department’s designated website. The
  538  designation of the agent in charge may be changed at the option
  539  of the agency. A change of the designated agent in charge is
  540  effective upon notification to the department, which shall be
  541  provided within 30 days after such change.
  542         (d) For the purposes of this subsection, an “agent in
  543  charge” is the licensed and appointed agent who is responsible
  544  for the supervision of all individuals within an insurance
  545  agency location, regardless of whether such individuals deal
  546  with the general public in the solicitation or negotiation of
  547  insurance contracts or the collection or accounting of moneys.
  548         (e) An agent in charge of an insurance agency is
  549  accountable for wrongful acts, misconduct, or violations of
  550  provisions of this code committed by the agent or by any person
  551  under his or her supervision while acting on behalf of the
  552  agency. This section may not be construed to render the agent in
  553  charge criminally liable for an act unless he or she personally
  554  committed or knew or should have known of the act and of the
  555  facts constituting a violation of this chapter.
  556         (f)An insurance agency location may not conduct the
  557  business of insurance unless the agency designates an agent in
  558  charge at all times. If the agency fails to update the
  559  designation of the agent in charge within 90 days after the date
  560  of a change in designation, the department shall automatically
  561  revoke the agency’s license.
  562         Section 9. Subsection (7) of section 626.112, Florida
  563  Statutes, is amended to read:
  564         626.112 License and appointment required; agents, customer
  565  representatives, adjusters, insurance agencies, service
  566  representatives, managing general agents.—
  567         (7)(a) Effective October 1, 2006, No individual, firm,
  568  partnership, corporation, association, or any other entity shall
  569  act in its own name or under a trade name, directly or
  570  indirectly, as an insurance agency, unless it complies with s.
  571  626.172 with respect to possessing an insurance agency license
  572  for each place of business at which it engages in an any
  573  activity that which may be performed only by a licensed
  574  insurance agent. However, an insurance agency that is owned and
  575  operated by a single licensed agent conducting business in his
  576  or her individual name and not employing or otherwise using the
  577  services of or appointing other licensees is exempt from the
  578  agency licensing requirements of this subsection. A branch place
  579  of business that is established by a licensed agency is
  580  considered a branch agency and is not required to be licensed so
  581  long as it transacts business under the same name and federal
  582  tax identification number as the licensed agency and has
  583  designated a licensed agent in charge of the location as
  584  required by s. 626.0428 and the address and telephone number of
  585  the location have been submitted to the department for inclusion
  586  in the licensing record of the licensed agency within 30 days
  587  after insurance transactions begin at the location Each agency
  588  engaged in business in this state before January 1, 2003, which
  589  is wholly owned by insurance agents currently licensed and
  590  appointed under this chapter, each incorporated agency whose
  591  voting shares are traded on a securities exchange, each agency
  592  designated and subject to supervision and inspection as a branch
  593  office under the rules of the National Association of Securities
  594  Dealers, and each agency whose primary function is offering
  595  insurance as a service or member benefit to members of a
  596  nonprofit corporation may file an application for registration
  597  in lieu of licensure in accordance with s. 626.172(3). Each
  598  agency engaged in business before October 1, 2006, shall file an
  599  application for licensure or registration on or before October
  600  1, 2006.
  601         (b)1. If an agency is required to be licensed but fails to
  602  file an application for licensure in accordance with this
  603  section, the department shall impose on the agency an
  604  administrative penalty in an amount of up to $10,000.
  605         2. If an agency is eligible for registration but fails to
  606  file an application for registration or an application for
  607  licensure in accordance with this section, the department shall
  608  impose on the agency an administrative penalty in an amount of
  609  up to $5,000.
  610         (c)(b)Effective October 1, 2013, the department must
  611  automatically convert the registration of an approved a
  612  registered insurance agency to shall, as a condition precedent
  613  to continuing business, obtain an insurance agency license if
  614  the department finds that, with respect to any majority owner,
  615  partner, manager, director, officer, or other person who manages
  616  or controls the agency, any person has:
  617         1. Been found guilty of, or has pleaded guilty or nolo
  618  contendere to, a felony in this state or any other state
  619  relating to the business of insurance or to an insurance agency,
  620  without regard to whether a judgment of conviction has been
  621  entered by the court having jurisdiction of the cases.
  622         2. Employed any individual in a managerial capacity or in a
  623  capacity dealing with the public who is under an order of
  624  revocation or suspension issued by the department. An insurance
  625  agency may request, on forms prescribed by the department,
  626  verification of any person’s license status. If a request is
  627  mailed within 5 working days after an employee is hired, and the
  628  employee’s license is currently suspended or revoked, the agency
  629  shall not be required to obtain a license, if the unlicensed
  630  person’s employment is immediately terminated.
  631         3. Operated the agency or permitted the agency to be
  632  operated in violation of s. 626.747.
  633         4. With such frequency as to have made the operation of the
  634  agency hazardous to the insurance-buying public or other
  635  persons:
  636         a. Solicited or handled controlled business. This
  637  subparagraph shall not prohibit the licensing of any lending or
  638  financing institution or creditor, with respect to insurance
  639  only, under credit life or disability insurance policies of
  640  borrowers from the institutions, which policies are subject to
  641  part IX of chapter 627.
  642         b. Misappropriated, converted, or unlawfully withheld
  643  moneys belonging to insurers, insureds, beneficiaries, or others
  644  and received in the conduct of business under the license.
  645         c. Unlawfully rebated, attempted to unlawfully rebate, or
  646  unlawfully divided or offered to divide commissions with
  647  another.
  648         d. Misrepresented any insurance policy or annuity contract,
  649  or used deception with regard to any policy or contract, done
  650  either in person or by any form of dissemination of information
  651  or advertising.
  652         e. Violated any provision of this code or any other law
  653  applicable to the business of insurance in the course of dealing
  654  under the license.
  655         f. Violated any lawful order or rule of the department.
  656         g. Failed or refused, upon demand, to pay over to any
  657  insurer he or she represents or has represented any money coming
  658  into his or her hands belonging to the insurer.
  659         h. Violated the provision against twisting as defined in s.
  660  626.9541(1)(l).
  661         i. In the conduct of business, engaged in unfair methods of
  662  competition or in unfair or deceptive acts or practices, as
  663  prohibited under part IX of this chapter.
  664         j. Willfully overinsured any property insurance risk.
  665         k. Engaged in fraudulent or dishonest practices in the
  666  conduct of business arising out of activities related to
  667  insurance or the insurance agency.
  668         l. Demonstrated lack of fitness or trustworthiness to
  669  engage in the business of insurance arising out of activities
  670  related to insurance or the insurance agency.
  671         m. Authorized or knowingly allowed individuals to transact
  672  insurance who were not then licensed as required by this code.
  673         5. Knowingly employed any person who within the preceding 3
  674  years has had his or her relationship with an agency terminated
  675  in accordance with paragraph (d).
  676         6. Willfully circumvented the requirements or prohibitions
  677  of this code.
  678         Section 10. Subsections (2), (3), and (4) of section
  679  626.172, Florida Statutes, are amended to read:
  680         626.172 Application for insurance agency license.—
  681         (2) An application for an insurance agency license must
  682  shall be signed by the owner or owners of the agency. If the
  683  agency is incorporated, the application must shall be signed by
  684  the president and secretary of the corporation. The application
  685  for an insurance agency license must shall include:
  686         (a) The name of each majority owner, partner, officer, and
  687  director of the insurance agency.
  688         (b) The residence address of each person required to be
  689  listed in the application under paragraph (a).
  690         (c) The name of the insurance agency, and its principal
  691  business street address and a valid e-mail address of the
  692  insurance agency.
  693         (d) The physical address location of each branch agency,
  694  including its name, e-mail address, and telephone number and the
  695  date that the branch location began transacting insurance office
  696  and the name under which each agency office conducts or will
  697  conduct business.
  698         (e) The name of each agent to be in full-time charge of an
  699  agency office and specification of which office, including
  700  branch locations.
  701         (f) The fingerprints of each of the following:
  702         1. A sole proprietor;
  703         2. Each partner;
  704         3. Each owner of an unincorporated agency;
  705         4. Each owner who directs or participates in the management
  706  or control of an incorporated agency whose shares are not traded
  707  on a securities exchange;
  708         5. The president, senior vice presidents, treasurer,
  709  secretary, and directors of the agency; and
  710         6. Any other person who directs or participates in the
  711  management or control of the agency, whether through the
  712  ownership of voting securities, by contract, by ownership of
  713  agency bank accounts, or otherwise.
  715  Fingerprints must be taken by a law enforcement agency or other
  716  entity approved by the department and must be accompanied by the
  717  fingerprint processing fee specified in s. 624.501. Fingerprints
  718  must shall be processed in accordance with s. 624.34. However,
  719  fingerprints need not be filed for an any individual who is
  720  currently licensed and appointed under this chapter. This
  721  paragraph does not apply to corporations whose voting shares are
  722  traded on a securities exchange.
  723         (g) Such additional information as the department requires
  724  by rule to ascertain the trustworthiness and competence of
  725  persons required to be listed on the application and to
  726  ascertain that such persons meet the requirements of this code.
  727  However, the department may not require that credit or character
  728  reports be submitted for persons required to be listed on the
  729  application.
  730         (h) Beginning October 1, 2005, The department must shall
  731  accept the uniform application for nonresident agency licensure.
  732  The department may adopt by rule revised versions of the uniform
  733  application.
  734         (3) The department shall issue a registration as an
  735  insurance agency to any agency that files a written application
  736  with the department and qualifies for registration. The
  737  application for registration shall require the agency to provide
  738  the same information required for an agency licensed under
  739  subsection (2), the agent identification number for each owner
  740  who is a licensed agent, proof that the agency qualifies for
  741  registration as provided in s. 626.112(7), and any other
  742  additional information that the department determines is
  743  necessary in order to demonstrate that the agency qualifies for
  744  registration. The application must be signed by the owner or
  745  owners of the agency. If the agency is incorporated, the
  746  application must be signed by the president and the secretary of
  747  the corporation. An agent who owns the agency need not file
  748  fingerprints with the department if the agent obtained a license
  749  under this chapter and the license is currently valid.
  750         (a) If an application for registration is denied, the
  751  agency must file an application for licensure no later than 30
  752  days after the date of the denial of registration.
  753         (b) A registered insurance agency must file an application
  754  for licensure no later than 30 days after the date that any
  755  person who is not a licensed and appointed agent in this state
  756  acquires any ownership interest in the agency. If an agency
  757  fails to file an application for licensure in compliance with
  758  this paragraph, the department shall impose an administrative
  759  penalty in an amount of up to $5,000 on the agency.
  760         (c) Sections 626.6115 and 626.6215 do not apply to agencies
  761  registered under this subsection.
  762         (3)(4) The department must shall issue a license or
  763  registration to each agency upon approval of the application,
  764  and each agency location must shall display the license or
  765  registration prominently in a manner that makes it clearly
  766  visible to a any customer or potential customer who enters the
  767  agency.
  768         Section 11. Paragraph (d) of subsection (1) of section
  769  626.321, Florida Statutes, is amended to read:
  770         626.321 Limited licenses.—
  771         (1) The department shall issue to a qualified applicant a
  772  license as agent authorized to transact a limited class of
  773  business in any of the following categories of limited lines
  774  insurance:
  775         (d) Motor vehicle rental insurance.—
  776         1. License covering only insurance of the risks set forth
  777  in this paragraph when offered, sold, or solicited with and
  778  incidental to the rental or lease of a motor vehicle and which
  779  applies only to the motor vehicle that is the subject of the
  780  lease or rental agreement and the occupants of the motor
  781  vehicle:
  782         a. Excess motor vehicle liability insurance providing
  783  coverage in excess of the standard liability limits provided by
  784  the lessor in the lessor’s lease to a person renting or leasing
  785  a motor vehicle from the licensee’s employer for liability
  786  arising in connection with the negligent operation of the leased
  787  or rented motor vehicle.
  788         b. Insurance covering the liability of the lessee to the
  789  lessor for damage to the leased or rented motor vehicle.
  790         c. Insurance covering the loss of or damage to baggage,
  791  personal effects, or travel documents of a person renting or
  792  leasing a motor vehicle.
  793         d. Insurance covering accidental personal injury or death
  794  of the lessee and any passenger who is riding or driving with
  795  the covered lessee in the leased or rented motor vehicle.
  796         2. Insurance under a motor vehicle rental insurance license
  797  may be issued only if the lease or rental agreement is for no
  798  more than 60 days, the lessee is not provided coverage for more
  799  than 60 consecutive days per lease period, and the lessee is
  800  given written notice that his or her personal insurance policy
  801  providing coverage on an owned motor vehicle may provide
  802  coverage of such risks and that the purchase of the insurance is
  803  not required in connection with the lease or rental of a motor
  804  vehicle. If the lease is extended beyond 60 days, the coverage
  805  may be extended one time only for a period not to exceed an
  806  additional 60 days. Insurance may be provided to the lessee as
  807  an additional insured on a policy issued to the licensee’s
  808  employer.
  809         3. The license may be issued only to the full-time salaried
  810  employee of a licensed general lines agent or to a business
  811  entity that offers motor vehicles for rent or lease if insurance
  812  sales activities authorized by the license are in connection
  813  with and incidental to the rental or lease of a motor vehicle.
  814         a. A license issued to a business entity that offers motor
  815  vehicles for rent or lease encompasses each office, branch
  816  office, employee, or place of business making use of the
  817  entity’s business name in order to offer, solicit, and sell
  818  insurance pursuant to this paragraph.
  819         b. The application for licensure must list the name,
  820  address, and phone number for each office, branch office, or
  821  place of business that is to be covered by the license. The
  822  licensee shall notify the department of the name, address, and
  823  phone number of any new location that is to be covered by the
  824  license before the new office, branch office, or place of
  825  business engages in the sale of insurance pursuant to this
  826  paragraph. The licensee must notify the department within 30
  827  days after closing or terminating an office, branch office, or
  828  place of business. Upon receipt of the notice, the department
  829  shall delete the office, branch office, or place of business
  830  from the license.
  831         c. A licensed and appointed entity is directly responsible
  832  and accountable for all acts of the licensee’s employees.
  833         Section 12. Section 626.382, Florida Statutes, is amended
  834  to read:
  835         626.382 Continuation, expiration of license; insurance
  836  agencies.—An insurance agency license continues The license of
  837  any insurance agency shall be issued for a period of 3 years and
  838  shall continue in force until it is canceled, suspended,
  839  revoked, or otherwise terminated. A license may be renewed by
  840  submitting a renewal request to the department on a form adopted
  841  by department rule.
  842         Section 13. Section 626.601, Florida Statutes, is amended
  843  to read:
  844         626.601 Improper conduct; inquiry; fingerprinting.—
  845         (1) The department or office may, upon its own motion or
  846  upon a written complaint signed by an any interested person and
  847  filed with the department or office, inquire into any alleged
  848  improper conduct of a any licensed, approved, or certified
  849  insurance agency, agent, adjuster, service representative,
  850  managing general agent, customer representative, title insurance
  851  agent, title insurance agency, mediator, neutral evaluator,
  852  continuing education course provider, instructor, school
  853  official, or monitor group under this code. The department or
  854  office may thereafter initiate an investigation of any such
  855  individual or entity licensee if it has reasonable cause to
  856  believe that the individual or entity licensee has violated any
  857  provision of the insurance code. During the course of its
  858  investigation, the department or office shall contact the
  859  individual or entity licensee being investigated unless it
  860  determines that contacting such individual or entity person
  861  could jeopardize the successful completion of the investigation
  862  or cause injury to the public.
  863         (2) In the investigation by the department or office of the
  864  alleged misconduct, the individual or entity licensee shall,
  865  whenever so required by the department or office, cause the
  866  individual’s or entity’s his or her books and records to be open
  867  for inspection for the purpose of such inquiries.
  868         (3) The complaints against an individual or entity any
  869  licensee may be informally alleged and are not required to
  870  include language need not be in any such language as is
  871  necessary to charge a crime on an indictment or information.
  872         (4) The expense for any hearings or investigations
  873  conducted under this law, as well as the fees and mileage of
  874  witnesses, may be paid out of the appropriate fund.
  875         (5) If the department or office, after investigation, has
  876  reason to believe that an individual a licensee may have been
  877  found guilty of or pleaded guilty or nolo contendere to a felony
  878  or a crime related to the business of insurance in this or any
  879  other state or jurisdiction, the department or office may
  880  require the individual licensee to file with the department or
  881  office a complete set of his or her fingerprints, which must
  882  shall be accompanied by the fingerprint processing fee set forth
  883  in s. 624.501. The fingerprints shall be taken by an authorized
  884  law enforcement agency or other department-approved entity.
  885         (6) The complaint and any information obtained pursuant to
  886  the investigation by the department or office are confidential
  887  and are exempt from the provisions of s. 119.07, unless the
  888  department or office files a formal administrative complaint,
  889  emergency order, or consent order against the individual or
  890  entity licensee. Nothing in This subsection does not shall be
  891  construed to prevent the department or office from disclosing
  892  the complaint or such information as it deems necessary to
  893  conduct the investigation, to update the complainant as to the
  894  status and outcome of the complaint, or to share such
  895  information with a any law enforcement agency.
  896         Section 14. Section 626.747, Florida Statutes, is repealed.
  897         Section 15. Paragraph (b) of subsection (1) of section
  898  626.8411, Florida Statutes, is amended to read:
  899         626.8411 Application of Florida Insurance Code provisions
  900  to title insurance agents or agencies.—
  901         (1) The following provisions of part II applicable to
  902  general lines agents or agencies also apply to title insurance
  903  agents or agencies:
  904         (b) Section 626.0428(4)(a) and (b) 626.747, relating to
  905  branch agencies.
  906         Section 16. Paragraph (c) of subsection (2) and subsection
  907  (3) of section 626.8805, Florida Statutes, is amended to read:
  908         626.8805 Certificate of authority to act as administrator.—
  909         (2) The administrator shall file with the office an
  910  application for a certificate of authority upon a form to be
  911  adopted by the commission and furnished by the office, which
  912  application shall include or have attached the following
  913  information and documents:
  914         (c) The names, addresses, official positions, and
  915  professional qualifications of the individuals who are employed
  916  or retained by the administrator and who are responsible for the
  917  conduct of the affairs of the administrator, including all
  918  members of the board of directors, board of trustees, executive
  919  committee, or other governing board or committee, and the
  920  principal officers in the case of a corporation or, the partners
  921  or members in the case of a partnership or association of the
  922  administrator, and any other person who exercises control or
  923  influence over the affairs of the administrator.
  924         (3) The applicant shall make available for inspection by
  925  the office copies of all contracts relating to services provided
  926  by the administrator to with insurers or other persons utilizing
  927  the services of the administrator.
  928         Section 17. Subsections (1) and (3) of section 626.8817,
  929  Florida Statutes, are amended to read:
  930         626.8817 Responsibilities of insurance company with respect
  931  to administration of coverage insured.—
  932         (1) If an insurer uses the services of an administrator,
  933  the insurer is responsible for determining the benefits, premium
  934  rates, underwriting criteria, and claims payment procedures
  935  applicable to the coverage and for securing reinsurance, if any.
  936  The rules pertaining to these matters shall be provided, in
  937  writing, by the insurer, or its designee, to the administrator.
  938  The responsibilities of the administrator as to any of these
  939  matters shall be set forth in a the written agreement binding
  940  upon between the administrator and the insurer.
  941         (3) In cases in which an administrator administers benefits
  942  for more than 100 certificateholders on behalf of an insurer,
  943  the insurer shall, at least semiannually, conduct a review of
  944  the operations of the administrator. At least one such review
  945  must be an onsite audit of the operations of the administrator.
  946  The insurer may contract with a qualified third party to conduct
  947  such examination.
  948         Section 18. Subsections (1) and (4) of section 626.882,
  949  Florida Statutes, are amended to read:
  950         626.882 Agreement between administrator and insurer;
  951  required provisions; maintenance of records.—
  952         (1) A No person may not act as an administrator without a
  953  written agreement, as required under s. 626.8817, which
  954  specifies the rights, duties and obligations of the between such
  955  person as administrator and an insurer.
  956         (4) If a policy is issued to a trustee or trustees, a copy
  957  of the trust agreement and any amendments to that agreement
  958  shall be furnished to the insurer or its designee by the
  959  administrator and shall be retained as part of the official
  960  records of both the administrator and the insurer for the
  961  duration of the policy and for 5 years thereafter.
  962         Section 19. Subsections (3), (4), and (5) of section
  963  626.883, Florida Statutes, are amended to read:
  964         626.883 Administrator as intermediary; collections held in
  965  fiduciary capacity; establishment of account; disbursement;
  966  payments on behalf of insurer.—
  967         (3) If charges or premiums deposited in a fiduciary account
  968  have been collected on behalf of or for more than one insurer,
  969  the administrator shall keep records clearly recording the
  970  deposits in and withdrawals from such account on behalf of or
  971  for each insurer. The administrator shall, upon request of an
  972  insurer or its designee, furnish such insurer with copies of
  973  records pertaining to deposits and withdrawals on behalf of or
  974  for such insurer.
  975         (4) The administrator may not pay a any claim by
  976  withdrawals from a fiduciary account. Withdrawals from such
  977  account shall be made as provided in the written agreement
  978  required under ss. 626.8817 and 626.882 between the
  979  administrator and the insurer for any of the following:
  980         (a) Remittance to an insurer entitled to such remittance.
  981         (b) Deposit in an account maintained in the name of such
  982  insurer.
  983         (c) Transfer to and deposit in a claims-paying account,
  984  with claims to be paid as provided by such insurer.
  985         (d) Payment to a group policyholder for remittance to the
  986  insurer entitled to such remittance.
  987         (e) Payment to the administrator of the commission, fees,
  988  or charges of the administrator.
  989         (f) Remittance of return premium to the person or persons
  990  entitled to such return premium.
  991         (5) All claims paid by the administrator from funds
  992  collected on behalf of the insurer shall be paid only on drafts
  993  of, and as authorized by, such insurer or its designee.
  994         Section 20. Subsection (3) of section 626.884, Florida
  995  Statutes, is amended to read:
  996         626.884 Maintenance of records by administrator; access;
  997  confidentiality.—
  998         (3) The insurer shall retain the right of continuing access
  999  to books and records maintained by the administrator sufficient
 1000  to permit the insurer to fulfill all of its contractual
 1001  obligations to insured persons, subject to any restrictions in
 1002  the written agreement pertaining to between the insurer and the
 1003  administrator on the proprietary rights of the parties in such
 1004  books and records.
 1005         Section 21. Subsections (1) and (2) of section 626.89,
 1006  Florida Statutes, are amended to read:
 1007         626.89 Annual financial statement and filing fee; notice of
 1008  change of ownership.—
 1009         (1) Each authorized administrator shall file with the
 1010  office a full and true statement of its financial condition,
 1011  transactions, and affairs. The statement shall be filed annually
 1012  on or before April March 1 or within such extension of time
 1013  therefor as the office for good cause may have granted and shall
 1014  be for the preceding calendar year or fiscal year, if the
 1015  administrator’s accounting is on a fiscal year basis. The
 1016  statement shall be in such form and contain such matters as the
 1017  commission prescribes and shall be verified by at least two
 1018  officers of such administrator. An administrator whose sole
 1019  stockholder is an association representing health care providers
 1020  which is not an affiliate of an insurer, an administrator of a
 1021  pooled governmental self-insurance program, or an administrator
 1022  that is a university may submit the preceding fiscal year’s
 1023  statement within 2 months after its fiscal year end.
 1024         (2) Each authorized administrator shall also file an
 1025  audited financial statement performed by an independent
 1026  certified public accountant. The audited financial statement
 1027  shall be filed with the office on or before July June 1 for the
 1028  preceding calendar or fiscal year ending December 31. An
 1029  administrator whose sole stockholder is an association
 1030  representing health care providers which is not an affiliate of
 1031  an insurer, an administrator of a pooled governmental self
 1032  insurance program, or an administrator that is a university may
 1033  submit the preceding fiscal year’s audited financial statement
 1034  within 5 months after the end of its fiscal year. An audited
 1035  financial statement prepared on a consolidated basis must
 1036  include a columnar consolidating or combining worksheet that
 1037  must be filed with the statement and must comply with the
 1038  following:
 1039         (a) Amounts shown on the consolidated audited financial
 1040  statement must be shown on the worksheet;
 1041         (b) Amounts for each entity must be stated separately; and
 1042         (c) Explanations of consolidating and eliminating entries
 1043  must be included.
 1044         Section 22. Section 626.931, Florida Statutes, is amended
 1045  to read:
 1046         626.931 Agent affidavit and Insurer reporting
 1047  requirements.—
 1048         (1) Each surplus lines agent shall on or before the 45th
 1049  day following each calendar quarter file with the Florida
 1050  Surplus Lines Service Office an affidavit, on forms as
 1051  prescribed and furnished by the Florida Surplus Lines Service
 1052  Office, stating that all surplus lines insurance transacted by
 1053  him or her during such calendar quarter has been submitted to
 1054  the Florida Surplus Lines Service Office as required.
 1055         (2) The affidavit of the surplus lines agent shall include
 1056  efforts made to place coverages with authorized insurers and the
 1057  results thereof.
 1058         (1)(3) Each foreign insurer accepting premiums shall, on or
 1059  before the end of the month following each calendar quarter,
 1060  file with the Florida Surplus Lines Service Office a verified
 1061  report of all surplus lines insurance transacted by such insurer
 1062  for insurance risks located in this state during such calendar
 1063  quarter.
 1064         (2)(4) Each alien insurer accepting premiums shall, on or
 1065  before June 30 of each year, file with the Florida Surplus Lines
 1066  Service Office a verified report of all surplus lines insurance
 1067  transacted by such insurer for insurance risks located in this
 1068  state during the preceding calendar year.
 1069         (3)(5) The department may waive the filing requirements
 1070  described in subsections (1) (3) and (2) (4).
 1071         (4)(6) Each insurer’s report and supporting information
 1072  shall be in a computer-readable format as determined by the
 1073  Florida Surplus Lines Service Office or shall be submitted on
 1074  forms prescribed by the Florida Surplus Lines Service Office and
 1075  shall show for each applicable agent:
 1076         (a) A listing of all policies, certificates, cover notes,
 1077  or other forms of confirmation of insurance coverage or any
 1078  substitutions thereof or endorsements thereto and the
 1079  identifying number; and
 1080         (b) Any additional information required by the department
 1081  or Florida Surplus Lines Service Office.
 1082         Section 23. Paragraph (a) of subsection (2) of section
 1083  626.932, Florida Statutes, is amended to read:
 1084         626.932 Surplus lines tax.—
 1085         (2)(a) The surplus lines agent shall make payable to the
 1086  department the tax related to each calendar quarter’s business
 1087  as reported to the Florida Surplus Lines Service Office, and
 1088  remit the tax to the Florida Surplus Lines Service Office on or
 1089  before the 45th day following each calendar quarter at the same
 1090  time as provided for the filing of the quarterly affidavit,
 1091  under s. 626.931. The Florida Surplus Lines Service Office shall
 1092  forward to the department the taxes and any interest collected
 1093  pursuant to paragraph (b), within 10 days after of receipt.
 1094         Section 24. Subsection (1) of section 626.935, Florida
 1095  Statutes, is amended to read:
 1096         626.935 Suspension, revocation, or refusal of surplus lines
 1097  agent’s license.—
 1098         (1) The department shall deny an application for, suspend,
 1099  revoke, or refuse to renew the appointment of a surplus lines
 1100  agent and all other licenses and appointments held by the
 1101  licensee under this code, on any of the following grounds:
 1102         (a) Removal of the licensee’s office from the licensee’s
 1103  state of residence.
 1104         (b) Removal of the accounts and records of his or her
 1105  surplus lines business from this state or the licensee’s state
 1106  of residence during the period when such accounts and records
 1107  are required to be maintained under s. 626.930.
 1108         (c) Closure of the licensee’s office for more than 30
 1109  consecutive days.
 1110         (d) Failure to make and file his or her affidavit or
 1111  reports when due as required by s. 626.931.
 1112         (d)(e) Failure to pay the tax or service fee on surplus
 1113  lines premiums, as provided in the Surplus Lines Law.
 1114         (e)(f) Suspension, revocation, or refusal to renew or
 1115  continue the license or appointment as a general lines agent,
 1116  service representative, or managing general agent.
 1117         (f)(g) Lack of qualifications as for an original surplus
 1118  lines agent’s license.
 1119         (g)(h) Violation of this Surplus Lines Law.
 1120         (h)(i) For any other applicable cause for which the license
 1121  of a general lines agent could be suspended, revoked, or refused
 1122  under s. 626.611 or s. 626.621.
 1123         Section 25. Subsection (1) of section 626.936, Florida
 1124  Statutes, is amended to read:
 1125         626.936 Failure to file reports or pay tax or service fee;
 1126  administrative penalty.—
 1127         (1) A Any licensed surplus lines agent who neglects to file
 1128  a report or an affidavit in the form and within the time
 1129  required or provided for in the Surplus Lines Law may be fined
 1130  up to $50 per day for each day the neglect continues, beginning
 1131  the day after the report or affidavit was due until the date the
 1132  report or affidavit is received. All sums collected under this
 1133  section shall be deposited into the Insurance Regulatory Trust
 1134  Fund.
 1135         Section 26. Paragraph (b) of subsection (2) of section
 1136  627.062, Florida Statutes, is amended to read:
 1137         627.062 Rate standards.—
 1138         (2) As to all such classes of insurance:
 1139         (b) Upon receiving a rate filing, the office shall review
 1140  the filing to determine if a rate is excessive, inadequate, or
 1141  unfairly discriminatory. In making that determination, the
 1142  office shall, in accordance with generally accepted and
 1143  reasonable actuarial techniques, consider the following factors:
 1144         1. Past and prospective loss experience within and without
 1145  this state.
 1146         2. Past and prospective expenses.
 1147         3. The degree of competition among insurers for the risk
 1148  insured.
 1149         4. Investment income reasonably expected by the insurer,
 1150  consistent with the insurer’s investment practices, from
 1151  investable premiums anticipated in the filing, plus any other
 1152  expected income from currently invested assets representing the
 1153  amount expected on unearned premium reserves and loss reserves.
 1154  The commission may adopt rules using reasonable techniques of
 1155  actuarial science and economics to specify the manner in which
 1156  insurers calculate investment income attributable to classes of
 1157  insurance written in this state and the manner in which
 1158  investment income is used to calculate insurance rates. Such
 1159  manner must contemplate allowances for an underwriting profit
 1160  factor and full consideration of investment income which produce
 1161  a reasonable rate of return; however, investment income from
 1162  invested surplus may not be considered.
 1163         5. The reasonableness of the judgment reflected in the
 1164  filing.
 1165         6. Dividends, savings, or unabsorbed premium deposits
 1166  allowed or returned to Florida policyholders, members, or
 1167  subscribers.
 1168         7. The adequacy of loss reserves.
 1169         8. The cost of reinsurance. The office may not disapprove a
 1170  rate as excessive solely due to the insurer having obtained
 1171  catastrophic reinsurance to cover the insurer’s estimated 250
 1172  year probable maximum loss or any lower level of loss.
 1173         9. Trend factors, including trends in actual losses per
 1174  insured unit for the insurer making the filing.
 1175         10. Conflagration and catastrophe hazards, if applicable.
 1176         11. Projected hurricane losses, if applicable, which must
 1177  be estimated using a model or method, or a straight average of
 1178  model results or output ranges, independently found to be
 1179  acceptable or reliable by the Florida Commission on Hurricane
 1180  Loss Projection Methodology, and as further provided in s.
 1181  627.0628.
 1182         12. A reasonable margin for underwriting profit and
 1183  contingencies.
 1184         13. The cost of medical services, if applicable.
 1185         14. Other relevant factors that affect the frequency or
 1186  severity of claims or expenses.
 1187         Section 27. Paragraph (d) of subsection (3) of section
 1188  627.0628, Florida Statutes, is amended to read:
 1189         627.0628 Florida Commission on Hurricane Loss Projection
 1190  Methodology; public records exemption; public meetings
 1191  exemption.—
 1193         (d) With respect to a rate filing under s. 627.062, an
 1194  insurer shall employ and may not modify or adjust actuarial
 1195  methods, principles, standards, models, or output ranges found
 1196  by the commission to be accurate or reliable in determining
 1197  hurricane loss factors for use in a rate filing under s.
 1198  627.062. An insurer shall employ and may not modify or adjust
 1199  models found by the commission to be accurate or reliable in
 1200  determining probable maximum loss levels pursuant to paragraph
 1201  (b) with respect to a rate filing under s. 627.062 made more
 1202  than 180 60 days after the commission has made such findings.
 1203  This paragraph does not prohibit an insurer from using a
 1204  straight average of model results or output ranges or using
 1205  straight averages for the purposes of a rate filing under s.
 1206  627.062.
 1207         Section 28. Present subsections (2) through (4) of section
 1208  627.072, Florida Statutes, are renumbered as subsections (3)
 1209  through (5), respectively, and a new subsection (2) is added to
 1210  that section, to read:
 1211         627.072 Making and use of rates.—
 1212         (2) A retrospective rating plan may contain a provision
 1213  that allows negotiation between the employer and the insurer to
 1214  determine the retrospective rating factors used to calculate the
 1215  premium for employers that have exposure in more than one state,
 1216  an estimated annual standard premium in this state of $175,000,
 1217  and an estimated annual countrywide standard premium of $1
 1218  million or more for workers’ compensation.
 1219         Section 29. Subsection (2) of section 627.281, Florida
 1220  Statutes, is amended to read:
 1221         627.281 Appeal from rating organization; workers’
 1222  compensation and employer’s liability insurance filings.—
 1223         (2) If such appeal is based upon the failure of the rating
 1224  organization to make a filing on behalf of such member or
 1225  subscriber which is based on a system of expense provisions
 1226  which differs, in accordance with the right granted in s.
 1227  627.072(3) 627.072(2), from the system of expense provisions
 1228  included in a filing made by the rating organization, the office
 1229  shall, if it grants the appeal, order the rating organization to
 1230  make the requested filing for use by the appellant. In deciding
 1231  such appeal, the office shall apply the applicable standards set
 1232  forth in ss. 627.062 and 627.072.
 1233         Section 30. Paragraphs (gg), (hh), and (ii) are added to
 1234  subsection (6) of section 627.351, Florida Statutes, to read:
 1235         627.351 Insurance risk apportionment plans.—
 1237         (gg)At least once every 6 months, the corporation shall
 1238  submit a report to the office and the Insurance Consumer
 1239  Advocate disclosing:
 1240         1. The total number of requests received for residential
 1241  sinkhole loss coverage;
 1242         2. The total number of policies issued for residential
 1243  sinkhole loss coverage;
 1244         3.The total number of requests declined for residential
 1245  sinkhole loss coverage; and
 1246         4. The reasons for declining the requests for residential
 1247  sinkhole loss coverage.
 1248         (hh)The Legislature finds that it is in the public
 1249  interest that sinkhole loss claims are resolved by stabilizing
 1250  the land and structure and making repairs to the foundation of
 1251  the damaged structure. Therefore, a Citizens Sinkhole
 1252  Stabilization Repair Program is established by the corporation.
 1253  By March 31, 2014, any claim against a corporation policy that
 1254  covers residential sinkhole loss for which it is determined that
 1255  such loss has occurred must be included in and governed by the
 1256  repair program for the purpose of stabilizing the land and
 1257  structure and making repairs to the foundation.
 1258         1. As used in this paragraph, the terms:
 1259         a. “Engineering report” means the report issued pursuant to
 1260  s. 627.7073(1).
 1261         b. “Recommendation of the engineer” means the
 1262  recommendation of the engineer engaged by the corporation
 1263  pursuant to s. 627.7073(1)(a)5.
 1264         c. “Stabilization repairs” means stabilizing the land and
 1265  structure and making repairs to the foundation.
 1266         d. “Stabilization repair contractor” means a contractor who
 1267  stabilizes the land and structure and makes repairs to the
 1268  foundation of the damaged structure.
 1269         2. The repair program may be managed by the corporation or
 1270  a third-party administrator and, at a minimum, must include the
 1271  following components:
 1272         a.The corporation may not require the policyholder to
 1273  advance payment for repairs.
 1274         b.Stabilization repairs shall be conducted by
 1275  stabilization repair contractors selected from an approved
 1276  stabilization repair contractor pool procured by the corporation
 1277  pursuant to an open and transparent process. Each stabilization
 1278  repair contractor within the pool must be qualified and approved
 1279  by the corporation based upon criteria including the following
 1280  minimum requirements:
 1281         (I)The stabilization repair contractor must be certified
 1282  as a contractor pursuant s. 489.113(1).
 1283         (II)The stabilization repair contractor corporate entity
 1284  must demonstrate experience in stabilization of sinkhole
 1285  activity pursuant to requirements to be established by the
 1286  corporation.
 1287         (III)The stabilization repair contractor must demonstrate
 1288  capacity to be bonded and provide performance, surety, or other
 1289  bonds as described in this section which may be supplemented by
 1290  additional requirements as determined by the corporation.
 1291         (IV)The stabilization repair contractor must demonstrate
 1292  insurance coverage requirements, including, but not limited to,
 1293  commercial general liability coverage and workers’ compensation,
 1294  to be established by the corporation.
 1295         (V)The stabilization repair contractor must maintain a
 1296  valid drug-free workplace program.
 1297         (VI)Such other requirements as established by the
 1298  corporation.
 1299         c.Pursuant to the stabilization repair program, qualified
 1300  stabilization repair contractors shall be selected from the
 1301  approved stabilization repair contractor pool to stabilize the
 1302  land and structure and repair the foundation of the damaged
 1303  structure pursuant to a fixed-price contract between the
 1304  contractor and the corporation. Such contracts are not subject
 1305  to paragraph (6)(e) or s. 287.057. Pursuant to the terms of the
 1306  contract, the selected stabilization repair contractor is solely
 1307  responsible for the performance of all necessary stabilization
 1308  repairs specified in the engineering report and recommendations
 1309  of the engineer.
 1310         d.The corporation shall develop a standard stabilization
 1311  repair contract for the purpose of stabilizing the land and
 1312  structure and repairing the foundation of all properties within
 1313  the program. The contract must include the following minimum
 1314  requirements:
 1315         (I)The assigned stabilization repair contractor must agree
 1316  to make all stabilization repairs identified in the engineering
 1317  report based upon a fixed price.
 1318         (II)Each stabilization repair contractor must post a
 1319  payment bond in favor of the corporation as obligee for each
 1320  project assigned and must post a performance bond, secured by a
 1321  third-party surety, in favor of the corporation as obligee, in a
 1322  principal amount equal to the total cost of all fixed-price
 1323  contracts annually awarded to that contractor.
 1324         (III)In addition to the required performance bond, each
 1325  stabilization repair contractor must also provide a warranty,
 1326  secured by a third-party surety, to the policyholder which
 1327  covers all repairs provided by the stabilization repair
 1328  contractor for at least 5 years after completion of the
 1329  stabilization repairs.
 1330         (IV)Throughout the course of the stabilization repairs
 1331  performed by the contractor, the engineer shall monitor the
 1332  property and confirm that stabilization has been satisfactorily
 1333  completed and that no further stabilization is necessary to
 1334  remedy the damage identified in the engineering report and
 1335  recommendation of the engineer.
 1336         (V)If the engineer concludes that additional stabilization
 1337  repair is necessary to complete the repairs specified in the
 1338  engineering report and recommendations of the engineer, the
 1339  stabilization repair contractor must perform the additional
 1340  stabilization repairs at no cost to the corporation or the
 1341  policyholder. The contract between the corporation and the
 1342  contractor must contain provisions specifying the remedy and
 1343  sanctions for failing to perform such additional repairs.
 1344         e.The corporation shall enter into contracts to perform
 1345  repairs pursuant to a process that includes, but is not limited
 1346  to, the following requirements:
 1347         (I)Within 30 days after the completion of the engineering
 1348  report, the report shall be identified on a list which shall be
 1349  made available to all stabilization contractors.
 1350         (II)The corporation shall establish a selection process
 1351  for assigning stabilization repair contractors to perform
 1352  repairs for each property within the program. The selection
 1353  process must include:
 1354         (A) All stabilization repair contractors within the
 1355  stabilization repair contractor pool shall be provided with an
 1356  opportunity to submit an offer, that includes an itemized
 1357  statement of work, to perform the stabilization repairs
 1358  recommended in the engineering report.
 1359         (B) The corporation shall review the offers and provide the
 1360  policyholder with a list of stabilization repair contractors
 1361  from which the policyholder shall be provided a reasonable time,
 1362  not to exceed 30 days, to participate in the selection by
 1363  choosing the stabilization repair contractor from among those
 1364  qualified contractors on the list provided by the corporation.
 1365         (C) If the policyholder has not made such a selection
 1366  within the 30-day period described herein, the corporation may
 1367  make the selection.
 1368         (D) The corporation may reserve the right to include any or
 1369  all contractors on the list provided to the policyholder based
 1370  upon quality, cost-effectiveness, and such other criteria as the
 1371  corporation shall determine.
 1372         (III)If no stabilization repair contractor submits an
 1373  offer to perform the stabilization repairs for a property within
 1374  the program or all offers are above the policyholder’s policy
 1375  limit, the corporation may enter the property into the selection
 1376  process again or the corporation may pay the policyholder an
 1377  amount up to the policy limits on the structure.
 1378         f.The corporation is not responsible for serving as a
 1379  stabilization repair contractor. The corporation’s obligations
 1380  pursuant to the repair program are not an election to repair by
 1381  the corporation and therefore do not imply or result in a new
 1382  contractual relationship with the policyholder.
 1383         g.The corporation’s liability related to repair activity,
 1384  including stabilization repairs pursuant to the sinkhole
 1385  stabilization program and all other repairs to the structure in
 1386  accordance with the terms of the policy, is no greater than the
 1387  policy limits on the structure.
 1388         h. This section does not prohibit the corporation from
 1389  establishing a managed repair program for other repairs to the
 1390  structure in accordance with the terms of the policy.
 1391         i.If a dispute arises between the corporation and the
 1392  policyholder as to the nature or extent of stabilization repairs
 1393  to be conducted under the program, the sole remedy for resolving
 1394  such disputes shall be specific performance.
 1395         j. This section supersedes s. 627.707(5), except for
 1396  paragraph (5)(e).
 1397         3. The corporation shall pay for other repairs to the
 1398  structure and contents in accordance with the terms of the
 1399  policy.
 1400         (ii)A policy for residential property insurance issued by
 1401  the corporation must include a deductible amount applicable to
 1402  sinkhole losses, offered in amounts equal to 2 percent, 5
 1403  percent, and 10 percent of the policy dwelling limits, with
 1404  appropriate premium discounts offered with each deductible
 1405  amount.
 1406         Section 31. Section 627.3519, Florida Statutes, is amended
 1407  to read:
 1408         627.3519 Annual report of aggregate net probable maximum
 1409  losses, financing options, and potential assessments.—No later
 1410  than February 1 of each year, the Florida Hurricane Catastrophe
 1411  Fund and Citizens Property Insurance Corporation Financial
 1412  Services Commission shall provide to the Legislature and the
 1413  Financial Services Commission a report of their respective the
 1414  aggregate net probable maximum losses, financing options, and
 1415  potential assessments of the Florida Hurricane Catastrophe Fund
 1416  and Citizens Property Insurance Corporation. The report of the
 1417  fund and the corporation must include their the respective 50
 1418  year, 100-year, and 250-year probable maximum losses of the fund
 1419  and the corporation; analysis of all reasonable financing
 1420  strategies for each such probable maximum loss, including the
 1421  amount and term of debt instruments; specification of the
 1422  percentage assessments that would be needed to support each of
 1423  the financing strategies; and calculations of the aggregate
 1424  assessment burden on Florida property and casualty policyholders
 1425  for each of the probable maximum losses. The commission shall
 1426  require the fund and the corporation to provide the commission
 1427  with such data and analysis as the commission considers
 1428  necessary to prepare the report.
 1429         Section 32. Paragraph (b) of subsection (2) of section
 1430  627.4133, Florida Statutes, is amended to read:
 1431         627.4133 Notice of cancellation, nonrenewal, or renewal
 1432  premium.—
 1433         (2) With respect to any personal lines or commercial
 1434  residential property insurance policy, including, but not
 1435  limited to, any homeowner’s, mobile home owner’s, farmowner’s,
 1436  condominium association, condominium unit owner’s, apartment
 1437  building, or other policy covering a residential structure or
 1438  its contents:
 1439         (b) The insurer shall give the first-named insured written
 1440  notice of nonrenewal, cancellation, or termination at least 120
 1441  100 days before the effective date of the nonrenewal,
 1442  cancellation, or termination. However, the insurer shall give at
 1443  least 100 days’ written notice, or written notice by June 1,
 1444  whichever is earlier, for any nonrenewal, cancellation, or
 1445  termination that would be effective between June 1 and November
 1446  30. The notice must include the reason or reasons for the
 1447  nonrenewal, cancellation, or termination, except that:
 1448         1. The insurer shall give the first-named insured written
 1449  notice of nonrenewal, cancellation, or termination at least 120
 1450  days prior to the effective date of the nonrenewal,
 1451  cancellation, or termination for a first-named insured whose
 1452  residential structure has been insured by that insurer or an
 1453  affiliated insurer for at least a 5-year period immediately
 1454  prior to the date of the written notice.
 1455         1.2. If cancellation is for nonpayment of premium, at least
 1456  10 days’ written notice of cancellation accompanied by the
 1457  reason therefor must be given. As used in this subparagraph, the
 1458  term “nonpayment of premium” means failure of the named insured
 1459  to discharge when due her or his obligations for in connection
 1460  with the payment of premiums on a policy or an any installment
 1461  of such premium, whether the premium is payable directly to the
 1462  insurer or its agent or indirectly under a any premium finance
 1463  plan or extension of credit, or failure to maintain membership
 1464  in an organization if such membership is a condition precedent
 1465  to insurance coverage. The term also means the failure of a
 1466  financial institution to honor an insurance applicant’s check
 1467  after delivery to a licensed agent for payment of a premium,
 1468  even if the agent has previously delivered or transferred the
 1469  premium to the insurer. If a dishonored check represents the
 1470  initial premium payment, the contract and all contractual
 1471  obligations are void ab initio unless the nonpayment is cured
 1472  within the earlier of 5 days after actual notice by certified
 1473  mail is received by the applicant or 15 days after notice is
 1474  sent to the applicant by certified mail or registered mail., and
 1475  If the contract is void, any premium received by the insurer
 1476  from a third party must be refunded to that party in full.
 1477         2.3. If such cancellation or termination occurs during the
 1478  first 90 days the insurance is in force and the insurance is
 1479  canceled or terminated for reasons other than nonpayment of
 1480  premium, at least 20 days’ written notice of cancellation or
 1481  termination accompanied by the reason therefor must be given
 1482  unless there has been a material misstatement or
 1483  misrepresentation or failure to comply with the underwriting
 1484  requirements established by the insurer.
 1485         3. After the policy has been in effect for 90 days, the
 1486  policy may not be canceled by the insurer unless there has been
 1487  a material misstatement, a nonpayment of premium, a failure to
 1488  comply with underwriting requirements established by the insurer
 1489  within 90 days after the date of effectuation of coverage, a
 1490  substantial change in the risk covered by the policy, or the
 1491  cancellation is for all insureds under such policies for a given
 1492  class of insureds. This subparagraph does not apply to
 1493  individually rated risks having a policy term of less than 90
 1494  days.
 1495         4. The requirement for providing written notice by June 1
 1496  of any nonrenewal that would be effective between June 1 and
 1497  November 30 does not apply to the following situations, but the
 1498  insurer remains subject to the requirement to provide such
 1499  notice at least 100 days before the effective date of
 1500  nonrenewal:
 1501         a. A policy that is nonrenewed due to a revision in the
 1502  coverage for sinkhole losses and catastrophic ground cover
 1503  collapse pursuant to s. 627.706.
 1504         4.b. A policy that is nonrenewed by Citizens Property
 1505  Insurance Corporation, pursuant to s. 627.351(6), for a policy
 1506  that has been assumed by an authorized insurer offering
 1507  replacement coverage to the policyholder is exempt from the
 1508  notice requirements of paragraph (a) and this paragraph. In such
 1509  cases, the corporation must give the named insured written
 1510  notice of nonrenewal at least 45 days before the effective date
 1511  of the nonrenewal.
 1513  After the policy has been in effect for 90 days, the policy may
 1514  not be canceled by the insurer unless there has been a material
 1515  misstatement, a nonpayment of premium, a failure to comply with
 1516  underwriting requirements established by the insurer within 90
 1517  days after the date of effectuation of coverage, or a
 1518  substantial change in the risk covered by the policy or if the
 1519  cancellation is for all insureds under such policies for a given
 1520  class of insureds. This paragraph does not apply to individually
 1521  rated risks having a policy term of less than 90 days.
 1522         5. Notwithstanding any other provision of law, an insurer
 1523  may cancel or nonrenew a property insurance policy after at
 1524  least 45 days’ notice if the office finds that the early
 1525  cancellation of some or all of the insurer’s policies is
 1526  necessary to protect the best interests of the public or
 1527  policyholders and the office approves the insurer’s plan for
 1528  early cancellation or nonrenewal of some or all of its policies.
 1529  The office may base such finding upon the financial condition of
 1530  the insurer, lack of adequate reinsurance coverage for hurricane
 1531  risk, or other relevant factors. The office may condition its
 1532  finding on the consent of the insurer to be placed under
 1533  administrative supervision pursuant to s. 624.81 or to the
 1534  appointment of a receiver under chapter 631.
 1535         6. A policy covering both a home and motor vehicle may be
 1536  nonrenewed for any reason applicable to either the property or
 1537  motor vehicle insurance after providing 90 days’ notice.
 1538         Section 33. Subsection (1) of section 627.4137, Florida
 1539  Statutes, is amended to read:
 1540         627.4137 Disclosure of certain information required.—
 1541         (1) Each insurer that provides which does or may provide
 1542  liability insurance coverage to pay all or a portion of a any
 1543  claim that which might be made shall provide, within 30 days
 1544  after of the written request of the claimant, a statement, under
 1545  oath, of a corporate officer or the insurer’s claims manager, or
 1546  superintendent, or licensed company adjuster setting forth the
 1547  following information with regard to each known policy of
 1548  insurance, including excess or umbrella insurance:
 1549         (a) The name of the insurer.
 1550         (b) The name of each insured.
 1551         (c) The limits of the liability coverage.
 1552         (d) A statement of any policy or coverage defense that the
 1553  which such insurer reasonably believes is available to the such
 1554  insurer at the time of filing such statement.
 1555         (e) A copy of the policy.
 1557  In addition, the insured, or her or his insurance agent, upon
 1558  written request of the claimant or the claimant’s attorney,
 1559  shall disclose the name and coverage of each known insurer to
 1560  the claimant and shall forward such request for information as
 1561  required by this subsection to all affected insurers. The
 1562  insurer shall then supply the information required in this
 1563  subsection to the claimant within 30 days after of receipt of
 1564  such request.
 1565         Section 34. Subsection (1) of section 627.421, Florida
 1566  Statutes, is amended to read:
 1567         627.421 Delivery of policy.—
 1568         (1) Subject to the insurer’s requirement as to payment of
 1569  premium, every policy shall be mailed or delivered to the
 1570  insured or to the person entitled thereto not later than 60 days
 1571  after the effectuation of coverage. Notwithstanding any other
 1572  provision of law, an insurer may allow a policyholder of
 1573  personal lines insurance to affirmatively elect delivery of the
 1574  policy documents, including, but not limited to, policies,
 1575  endorsements, notices, or documents, by electronic means in lieu
 1576  of delivery by mail.
 1577         Section 35. Subsection (2) of section 627.43141, Florida
 1578  Statutes, is amended to read:
 1579         627.43141 Notice of change in policy terms.—
 1580         (2) A renewal policy may contain a change in policy terms.
 1581  If a renewal policy contains does contain such change, the
 1582  insurer must give the named insured written notice of the
 1583  change, which may either must be enclosed along with the written
 1584  notice of renewal premium required by ss. 627.4133 and 627.728
 1585  or sent in a separate notice that complies with the nonrenewal
 1586  mailing time requirement for that particular line of business.
 1587  The insurer must also provide a sample copy of the notice to the
 1588  insured’s insurance agent before or at the same time that notice
 1589  is given to the insured. Such notice shall be entitled “Notice
 1590  of Change in Policy Terms.”
 1591         Section 36. Section 627.6484, Florida Statutes, is amended
 1592  to read:
 1593         627.6484 Dissolution of association; termination of
 1594  enrollment; availability of other coverage.—
 1595         (1) The association shall accept applications for insurance
 1596  only until June 30, 1991, after which date no further
 1597  applications may be accepted. Upon receipt of an application for
 1598  insurance, the association shall issue coverage for an eligible
 1599  applicant. When appropriate, the administrator shall forward a
 1600  copy of the application to a market assistance plan created by
 1601  the office, which shall conduct a diligent search of the private
 1602  marketplace for a carrier willing to accept the application.
 1603         (2) Coverage for each policyholder of the association
 1604  terminates at midnight, June 30, 2014, or on the date that
 1605  health insurance coverage is effective with another insurer,
 1606  whichever occurs first, and such coverage may not be renewed.
 1607         (3) The association shall provide assistance to each
 1608  policyholder concerning how to obtain health insurance coverage.
 1609  Such assistance must include:
 1610         (a) The identification of insurers and health maintenance
 1611  organizations offering coverage in the individual market,
 1612  including coverage inside and outside of the Health Insurance
 1613  Exchange;
 1614         (b) A basic explanation of the levels of coverage
 1615  available; and
 1616         (c) Specific information relating to local and online
 1617  sources from which a policyholder may obtain detailed policy and
 1618  premium comparisons and directly obtain coverage.
 1619         (4) The association shall provide written notice to all
 1620  policyholders by September 1, 2013, which informs each
 1621  policyholder with respect to:
 1622         (a) The date that coverage with the association is
 1623  terminated and that such coverage may not be renewed.
 1624         (b) The opportunity for the policyholder to obtain
 1625  individual health insurance coverage on a guaranteed-issue
 1626  basis, regardless of policyholder’s health status, from a health
 1627  insurer or health maintenance organization that offers coverage
 1628  in the individual market, including the dates of open enrollment
 1629  periods for obtaining such coverage.
 1630         (c) How to access coverage through the Health Insurance
 1631  Exchange established for this state pursuant to the Patient
 1632  Protection and Affordable Care Act and the potential for
 1633  obtaining reduced premiums and cost-sharing provisions depending
 1634  on the policyholder’s family income level.
 1635         (d) Contact information for a representative of the
 1636  association who is able to provide additional information about
 1637  obtaining individual health insurance coverage both inside and
 1638  outside of the Health Insurance Exchange.
 1639         (5) After termination of coverage, the association must
 1640  continue to receive and process timely submitted claims in
 1641  accordance with the laws of this state.
 1642         (6) By March 15, 2015, the association shall determine the
 1643  final assessment to be collected from insurers for funding
 1644  claims and administrative expenses of the association or, if
 1645  surplus funds remain, shall determine the refund amount to be
 1646  provided to each insurer based on the same pro rata formula used
 1647  for determining each insurer’s assessment.
 1648         (7) By September 1, 2015, the board must:
 1649         (a) Complete performance of all program responsibilities.
 1650         (b) Sell or otherwise dispose of all physical assets of the
 1651  association.
 1652         (c) Make a final accounting of the finances of the
 1653  association.
 1654         (d) Transfer all records to the Department of Financial
 1655  Services, which shall serve as custodian of such records.
 1656         (e) Execute a legal dissolution of the association and
 1657  report such action to the Chief Financial Officer, the Insurance
 1658  Commissioner, the President of the Senate, and the Speaker of
 1659  the House of Representatives.
 1660         (2) The office shall, after consultation with the health
 1661  insurers licensed in this state, adopt a market assistance plan
 1662  to assist in the placement of risks of Florida Comprehensive
 1663  Health Association applicants. All health insurers and health
 1664  maintenance organizations licensed in this state shall
 1665  participate in the plan.
 1666         (3) Guidelines for the use of such program shall be a part
 1667  of the association’s plan of operation. The guidelines shall
 1668  describe which types of applications are to be exempt from
 1669  submission to the market assistance plan. An exemption shall be
 1670  based upon a determination that due to a specific health
 1671  condition an applicant is ineligible for coverage in the
 1672  standard market. The guidelines shall also describe how the
 1673  market assistance plan is to be conducted, and how the periodic
 1674  reviews to depopulate the association are to be conducted.
 1675         (4) If a carrier is found through the market assistance
 1676  plan, the individual shall apply to that company. If the
 1677  individual’s application is accepted, association coverage shall
 1678  terminate upon the effective date of the coverage with the
 1679  private carrier. For the purpose of applying a preexisting
 1680  condition limitation or exclusion, any carrier accepting a risk
 1681  pursuant to this section shall provide coverage as if it began
 1682  on the date coverage was effectuated on behalf of the
 1683  association, and shall be indemnified by the association for
 1684  claims costs incurred as a result of utilizing such effective
 1685  date.
 1686         (5) The association shall establish a policyholder
 1687  assistance program by July 1, 1991, to assist in placing
 1688  eligible policyholders in other coverage programs, including
 1689  Medicare and Medicaid.
 1690         Section 37. Section 627.64872, Florida Statutes, is
 1691  repealed.
 1692         Section 38. Effective October 1, 2015, sections 627.648,
 1693  627.6482, 627.6484, 627.6486, 627.6488, 627.6489, 627.649,
 1694  627.6492, 627.6494, 627.6496, 627.6498, and 627.6499, Florida
 1695  Statutes, are repealed.
 1696         Section 39. Paragraph (b) of subsection (4) of section
 1697  627.7015, Florida Statutes, is amended to read:
 1698         627.7015 Alternative procedure for resolution of disputed
 1699  property insurance claims.—
 1700         (4) The department shall adopt by rule a property insurance
 1701  mediation program to be administered by the department or its
 1702  designee. The department may also adopt special rules which are
 1703  applicable in cases of an emergency within the state. The rules
 1704  shall be modeled after practices and procedures set forth in
 1705  mediation rules of procedure adopted by the Supreme Court. The
 1706  rules shall provide for:
 1707         (b) Qualifications, denial of application, suspension,
 1708  revocation, and other penalties for of mediators as provided in
 1709  s. 627.745 and in the Florida Rules of Certified and Court
 1710  Appointed Mediators, and for such other individuals as are
 1711  qualified by education, training, or experience as the
 1712  department determines to be appropriate.
 1713         Section 40. Section 627.70151, Florida Statutes, is created
 1714  to read:
 1715         627.70151 Appraisal; conflicts of interest.—An insurer that
 1716  offers residential coverage, as defined in s. 627.4025, or a
 1717  policyholder that uses an appraisal clause in the property
 1718  insurance contract to establish a process of estimating or
 1719  evaluating the amount of the loss through the use of an
 1720  impartial umpire may challenge the umpire’s impartiality and
 1721  disqualify the proposed umpire only if:
 1722         (1) A familial relationship within the third degree exists
 1723  between the umpire and any party or a representative of any
 1724  party;
 1725         (2) The umpire has previously represented any party or a
 1726  representative of any party in a professional capacity in the
 1727  same or a substantially related matter;
 1728         (3) The umpire has represented another person in a
 1729  professional capacity on the same or a substantially related
 1730  matter, which includes the claim, same property, or an adjacent
 1731  property and that other person’s interests are materially
 1732  adverse to the interests of any party; or
 1733         (4) The umpire has worked as an employer or employee of any
 1734  party within the preceding 5 years.
 1735         Section 41. Paragraph (c) of subsection (2) of section
 1736  627.706, Florida Statutes, is amended to read:
 1737         627.706 Sinkhole insurance; catastrophic ground cover
 1738  collapse; definitions.—
 1739         (2) As used in ss. 627.706-627.7074, and as used in
 1740  connection with any policy providing coverage for a catastrophic
 1741  ground cover collapse or for sinkhole losses, the term:
 1742         (c) “Neutral evaluator” means a professional engineer or a
 1743  professional geologist who has completed a course of study in
 1744  alternative dispute resolution designed or approved by the
 1745  department for use in the neutral evaluation process, and who is
 1746  determined by the department to be fair and impartial, and who
 1747  is not otherwise ineligible for certification as provided in s.
 1748  627.7074.
 1749         Section 42. Subsection (1) of section 627.7074, Florida
 1750  Statutes, is amended to read:
 1751         627.7074 Alternative procedure for resolution of disputed
 1752  sinkhole insurance claims.—
 1753         (1) The department shall:
 1754         (a) Certify and maintain a list of persons who are neutral
 1755  evaluators.
 1756         (b) Adopt rules for certifying, denying certification,
 1757  suspending certification, and revoking certification as a
 1758  neutral evaluator, in keeping with qualifications specified in
 1759  this section and ss. 627.706 and 627.745(4).
 1760         (c)(b) Prepare a consumer information pamphlet for
 1761  distribution by insurers to policyholders which clearly
 1762  describes the neutral evaluation process and includes
 1763  information necessary for the policyholder to request a neutral
 1764  evaluation.
 1765         Section 43. Paragraph (a) of subsection (5) of section
 1766  627.736, Florida Statutes, is amended to read:
 1767         627.736 Required personal injury protection benefits;
 1768  exclusions; priority; claims.—
 1770         (a) A physician, hospital, clinic, or other person or
 1771  institution lawfully rendering treatment to an injured person
 1772  for a bodily injury covered by personal injury protection
 1773  insurance may charge the insurer and injured party only a
 1774  reasonable amount pursuant to this section for the services and
 1775  supplies rendered, and the insurer providing such coverage may
 1776  pay for such charges directly to such person or institution
 1777  lawfully rendering such treatment if the insured receiving such
 1778  treatment or his or her guardian has countersigned the properly
 1779  completed invoice, bill, or claim form approved by the office
 1780  upon which such charges are to be paid for as having actually
 1781  been rendered, to the best knowledge of the insured or his or
 1782  her guardian. However, such a charge may not exceed the amount
 1783  the person or institution customarily charges for like services
 1784  or supplies. In determining whether a charge for a particular
 1785  service, treatment, or otherwise is reasonable, consideration
 1786  may be given to evidence of usual and customary charges and
 1787  payments accepted by the provider involved in the dispute,
 1788  reimbursement levels in the community and various federal and
 1789  state medical fee schedules applicable to motor vehicle and
 1790  other insurance coverages, and other information relevant to the
 1791  reasonableness of the reimbursement for the service, treatment,
 1792  or supply.
 1793         1. The insurer may limit reimbursement to 80 percent of the
 1794  following schedule of maximum charges:
 1795         a. For emergency transport and treatment by providers
 1796  licensed under chapter 401, 200 percent of Medicare.
 1797         b. For emergency services and care provided by a hospital
 1798  licensed under chapter 395, 75 percent of the hospital’s usual
 1799  and customary charges.
 1800         c. For emergency services and care as defined by s. 395.002
 1801  provided in a facility licensed under chapter 395 rendered by a
 1802  physician or dentist, and related hospital inpatient services
 1803  rendered by a physician or dentist, the usual and customary
 1804  charges in the community.
 1805         d. For hospital inpatient services, other than emergency
 1806  services and care, 200 percent of the Medicare Part A
 1807  prospective payment applicable to the specific hospital
 1808  providing the inpatient services.
 1809         e. For hospital outpatient services, other than emergency
 1810  services and care, 200 percent of the Medicare Part A Ambulatory
 1811  Payment Classification for the specific hospital providing the
 1812  outpatient services.
 1813         f. For all other medical services, supplies, and care, 200
 1814  percent of the allowable amount under:
 1815         (I) The participating physicians fee schedule of Medicare
 1816  Part B, except as provided in sub-sub-subparagraphs (II) and
 1817  (III).
 1818         (II) Medicare Part B, in the case of services, supplies,
 1819  and care provided by ambulatory surgical centers and clinical
 1820  laboratories.
 1821         (III) The Durable Medical Equipment Prosthetics/Orthotics
 1822  and Supplies fee schedule of Medicare Part B, in the case of
 1823  durable medical equipment.
 1825  However, if such services, supplies, or care is not reimbursable
 1826  under Medicare Part B, as provided in this sub-subparagraph, the
 1827  insurer may limit reimbursement to 80 percent of the maximum
 1828  reimbursable allowance under workers’ compensation, as
 1829  determined under s. 440.13 and rules adopted thereunder which
 1830  are in effect at the time such services, supplies, or care is
 1831  provided. Services, supplies, or care that is not reimbursable
 1832  under Medicare or workers’ compensation is not required to be
 1833  reimbursed by the insurer.
 1834         2. For purposes of subparagraph 1., the applicable fee
 1835  schedule or payment limitation under Medicare is the fee
 1836  schedule or payment limitation in effect on March 1 of the year
 1837  in which the services, supplies, or care is rendered and for the
 1838  area in which such services, supplies, or care is rendered, and
 1839  the applicable fee schedule or payment limitation applies from
 1840  March 1 until the last day of the following February throughout
 1841  the remainder of that year, notwithstanding any subsequent
 1842  change made to the fee schedule or payment limitation, except
 1843  that it may not be less than the allowable amount under the
 1844  applicable schedule of Medicare Part B for 2007 for medical
 1845  services, supplies, and care subject to Medicare Part B.
 1846         3. Subparagraph 1. does not allow the insurer to apply any
 1847  limitation on the number of treatments or other utilization
 1848  limits that apply under Medicare or workers’ compensation. An
 1849  insurer that applies the allowable payment limitations of
 1850  subparagraph 1. must reimburse a provider who lawfully provided
 1851  care or treatment under the scope of his or her license,
 1852  regardless of whether such provider is entitled to reimbursement
 1853  under Medicare due to restrictions or limitations on the types
 1854  or discipline of health care providers who may be reimbursed for
 1855  particular procedures or procedure codes. However, subparagraph
 1856  1. does not prohibit an insurer from using the Medicare coding
 1857  policies and payment methodologies of the federal Centers for
 1858  Medicare and Medicaid Services, including applicable modifiers,
 1859  to determine the appropriate amount of reimbursement for medical
 1860  services, supplies, or care if the coding policy or payment
 1861  methodology does not constitute a utilization limit.
 1862         4. If an insurer limits payment as authorized by
 1863  subparagraph 1., the person providing such services, supplies,
 1864  or care may not bill or attempt to collect from the insured any
 1865  amount in excess of such limits, except for amounts that are not
 1866  covered by the insured’s personal injury protection coverage due
 1867  to the coinsurance amount or maximum policy limits.
 1868         5. Effective July 1, 2012, an insurer may limit payment as
 1869  authorized by this paragraph only if the insurance policy
 1870  includes a notice at the time of issuance or renewal that the
 1871  insurer may limit payment pursuant to the schedule of charges
 1872  specified in this paragraph. A policy form approved by the
 1873  office satisfies this requirement. If a provider submits a
 1874  charge for an amount less than the amount allowed under
 1875  subparagraph 1., the insurer may pay the amount of the charge
 1876  submitted.
 1877         Section 44. Subsection (3) of section 627.745, Florida
 1878  Statutes, is amended, present subsections (4) and (5) of that
 1879  section are renumbered as subsections (5) and (6), respectively,
 1880  and a new subsection (4) is added to that section, to read:
 1881         627.745 Mediation of claims.—
 1882         (3)(a) The department shall approve mediators to conduct
 1883  mediations pursuant to this section. All mediators must file an
 1884  application under oath for approval as a mediator.
 1885         (b) To qualify for approval as a mediator, an individual a
 1886  person must meet one of the following qualifications:
 1887         1. Possess an active certification as a Florida Circuit
 1888  Court Mediator. A Florida Circuit Court Mediator in a lapsed,
 1889  suspended, or decertified status is not eligible to participate
 1890  in the mediation program a masters or doctorate degree in
 1891  psychology, counseling, business, accounting, or economics, be a
 1892  member of The Florida Bar, be licensed as a certified public
 1893  accountant, or demonstrate that the applicant for approval has
 1894  been actively engaged as a qualified mediator for at least 4
 1895  years prior to July 1, 1990.
 1896         2. Be an approved department mediator as of July 1, 2013,
 1897  and have conducted at least one mediation on behalf of the
 1898  department within 4 years immediately preceding that the date
 1899  the application for approval is filed with the department, have
 1900  completed a minimum of a 40-hour training program approved by
 1901  the department and successfully passed a final examination
 1902  included in the training program and approved by the department.
 1903  The training program shall include and address all of the
 1904  following:
 1905         a. Mediation theory.
 1906         b. Mediation process and techniques.
 1907         c. Standards of conduct for mediators.
 1908         d. Conflict management and intervention skills.
 1909         e. Insurance nomenclature.
 1910         (4) The department shall deny an application, or suspend or
 1911  revoke its approval of a mediator or its certification of a
 1912  neutral evaluator to serve in such capacity, if it finds that
 1913  any of the following grounds exist:
 1914         (a) Lack of one or more of the qualifications specified in
 1915  this section for approval or certification.
 1916         (b) Material misstatement, misrepresentation, or fraud in
 1917  obtaining or attempting to obtain the approval or certification.
 1918         (c) Demonstrated lack of fitness or trustworthiness to act
 1919  as a mediator or neutral evaluator.
 1920         (d) Fraudulent or dishonest practices in the conduct of
 1921  mediation or neutral evaluation or in the conduct of business in
 1922  the financial services industry.
 1923         (e) Violation of any provision of this code, a lawful order
 1924  or rule of the department, the Florida Rules for Certified and
 1925  Court-Appointed Mediators, or aiding, instructing, or
 1926  encouraging another party in committing such a violation.
 1928  The department may adopt rules to administer this subsection.
 1929         Section 45. Subsection (4) of section 627.841, Florida
 1930  Statutes, is amended to read:
 1931         627.841 Delinquency, collection, cancellation, and payment
 1932  check return charge charges; attorney attorney’s fees.—
 1933         (4) In the event that a payment is made to a premium
 1934  finance company by debit, credit, electronic funds transfer,
 1935  check, or draft and such payment the instrument is returned,
 1936  declined, or cannot be processed due to because of insufficient
 1937  funds to pay it, the premium finance company may, if the premium
 1938  finance agreement so provides, impose a return payment charge of
 1939  $15.
 1940         Section 46. Paragraph (b) of subsection (1) of section
 1941  627.952, Florida Statutes, is amended to read:
 1942         627.952 Risk retention and purchasing group agents.—
 1943         (1) Any person offering, soliciting, selling, purchasing,
 1944  administering, or otherwise servicing insurance contracts,
 1945  certificates, or agreements for any purchasing group or risk
 1946  retention group to a any resident of this state, either directly
 1947  or indirectly, by the use of mail, advertising, or other means
 1948  of communication, shall obtain a license and appointment to act
 1949  as a resident general lines agent, if a resident of this state,
 1950  or a nonresident general lines agent if not a resident. Any such
 1951  person shall be subject to all requirements of the Florida
 1952  Insurance Code.
 1953         (b) A Any person required to be licensed and appointed
 1954  under this subsection, in order to place business through
 1955  Florida eligible surplus lines carriers, must, if a resident of
 1956  this state, be licensed and appointed as a surplus lines agent.
 1957  If not a resident of this state, such person must be licensed
 1958  and appointed as a nonresident surplus lines agent in this her
 1959  or his state of residence and file and maintain a fidelity bond
 1960  in favor of the people of the State of Florida executed by a
 1961  surety company admitted in this state and payable to the State
 1962  of Florida; however, such nonresident is limited to the
 1963  provision of insurance for purchasing groups. The bond must be
 1964  continuous in form and in the amount of not less than $50,000,
 1965  aggregate liability. The bond must remain in force and effect
 1966  until the surety is released from liability by the department or
 1967  until the bond is canceled by the surety. The surety may cancel
 1968  the bond and be released from further liability upon 30 days’
 1969  prior written notice to the department. The cancellation does
 1970  not affect any liability incurred or accrued before the
 1971  termination of the 30-day period. Upon receipt of a notice of
 1972  cancellation, the department shall immediately notify the agent.
 1973         Section 47. Subsection (6) of section 627.971, Florida
 1974  Statutes, is amended to read:
 1975         627.971 Definitions.—As used in this part:
 1976         (6) “Financial guaranty insurance corporation” means a
 1977  stock or mutual insurer licensed to transact financial guaranty
 1978  insurance business in this state.
 1979         Section 48. Subsection (1) of section 627.972, Florida
 1980  Statutes, is amended to read:
 1981         627.972 Organization; financial requirements.—
 1982         (1) A financial guaranty insurance corporation must be
 1983  organized and licensed in the manner prescribed in this code for
 1984  stock or mutual property and casualty insurers except that:
 1985         (a) A corporation organized to transact financial guaranty
 1986  insurance may, subject to the provisions of this code, be
 1987  licensed to transact:
 1988         1. Residual value insurance, as defined by s. 624.6081;
 1989         2. Surety insurance, as defined by s. 624.606;
 1990         3. Credit insurance, as defined by s. 624.605(1)(i); and
 1991         4. Mortgage guaranty insurance as defined in s. 635.011,
 1992  provided that the provisions of chapter 635 are met.
 1993         (b)1. Before Prior to the issuance of a license, a
 1994  corporation must submit to the office for approval, a plan of
 1995  operation detailing:
 1996         a. The types and projected diversification of guaranties to
 1997  be issued;
 1998         b. The underwriting procedures to be followed;
 1999         c. The managerial oversight methods;
 2000         d. The investment policies; and
 2001         e. Any Other matters prescribed by the office;
 2002         2. An insurer which is writing only the types of insurance
 2003  allowed under this part on July 1, 1988, and otherwise meets the
 2004  requirements of this part, is exempt from the requirements of
 2005  this paragraph.
 2006         (c) An insurer transacting financial guaranty insurance is
 2007  subject to all provisions of this code that are applicable to
 2008  property and casualty insurers to the extent that those
 2009  provisions are not inconsistent with this part.
 2010         (d) The investments of an insurer transacting financial
 2011  guaranty insurance in an any entity insured by the corporation
 2012  may not exceed 2 percent of its admitted assets as of the end of
 2013  the prior calendar year.
 2014         (e) An insurer transacting financial guaranty insurance may
 2015  only assume those lines of insurance for which it is licensed to
 2016  write direct business.
 2017         Section 49. Subsection (13) of section 628.901, Florida
 2018  Statutes, is amended to read:
 2019         628.901 Definitions.—As used in this part, the term:
 2020         (13) “Qualifying reinsurer parent company” means a
 2021  reinsurer that which currently holds a certificate of authority
 2022  or qualifies for credit reinsurance under s. 624.610(3) and
 2023  possesses, letter of eligibility or is an accredited or a
 2024  satisfactory non-approved reinsurer in this state possessing a
 2025  consolidated GAAP net worth of at least $500 million and a
 2026  consolidated debt to total capital ratio of not greater than
 2027  0.50.
 2028         Section 50. Paragraph (a) of subsection (2) and paragraph
 2029  (a) of subsection (3) of section 628.909, Florida Statutes, are
 2030  amended to read:
 2031         628.909 Applicability of other laws.—
 2032         (2) The following provisions of the Florida Insurance Code
 2033  apply to captive insurers who are not industrial insured captive
 2034  insurers to the extent that such provisions are not inconsistent
 2035  with this part:
 2036         (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085,
 2037  624.40851, 624.4095, 624.411, 624.425, and 624.426.
 2038         (3) The following provisions of the Florida Insurance Code
 2039  apply to industrial insured captive insurers to the extent that
 2040  such provisions are not inconsistent with this part:
 2041         (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085,
 2042  624.40851, 624.4095, 624.411, 624.425, 624.426, and 624.609(1).
 2043         Section 51. Subsection (8) of section 634.406, Florida
 2044  Statutes, is renumbered as subsection (7), and present
 2045  subsections (6) and (7) of that section are amended, to read:
 2046         634.406 Financial requirements.—
 2047         (6) An association that which holds a license under this
 2048  part and which does not hold any other license under this
 2049  chapter may allow its premiums for service warranties written
 2050  under this part to exceed the ratio to net assets limitations of
 2051  this section if the association meets all of the following:
 2052         (a) Maintains net assets of at least $750,000.
 2053         (b) Utilizes a contractual liability insurance policy
 2054  approved by the office which:
 2055         1. Reimburses the service warranty association for 100
 2056  percent of its claims liability and is issued by an insurer that
 2057  maintains a policyholder surplus of at least $100 million; or
 2058         2. Complies with the requirements of subsection (3) and is
 2059  issued by an insurer that maintains a policyholder surplus of at
 2060  least $200 million.
 2061         (c) The insurer issuing the contractual liability insurance
 2062  policy:
 2063         1. Maintains a policyholder surplus of at least $100
 2064  million.
 2065         1.2. Is rated “A” or higher by A.M. Best Company or an
 2066  equivalent rating by another national rating service acceptable
 2067  to the office.
 2068         3. Is in no way affiliated with the warranty association.
 2069         2.4. In conjunction with the warranty association’s filing
 2070  of the quarterly and annual reports, provides, on a form
 2071  prescribed by the commission, a statement certifying the gross
 2072  written premiums in force reported by the warranty association
 2073  and a statement that all of the warranty association’s gross
 2074  written premium in force is covered under the contractual
 2075  liability policy, whether or not it has been reported.
 2076         (7) A contractual liability policy must insure 100 percent
 2077  of an association’s claims exposure under all of the
 2078  association’s service warranty contracts, wherever written,
 2079  unless all of the following are satisfied:
 2080         (a) The contractual liability policy contains a clause that
 2081  specifically names the service warranty contract holders as sole
 2082  beneficiaries of the contractual liability policy and claims are
 2083  paid directly to the person making a claim under the contract;
 2084         (b) The contractual liability policy meets all other
 2085  requirements of this part, including subsection (3) of this
 2086  section, which are not inconsistent with this subsection;
 2087         (c) The association has been in existence for at least 5
 2088  years or the association is a wholly owned subsidiary of a
 2089  corporation that has been in existence and has been licensed as
 2090  a service warranty association in the state for at least 5
 2091  years, and:
 2092         1. Is listed and traded on a recognized stock exchange; is
 2093  listed in NASDAQ (National Association of Security Dealers
 2094  Automated Quotation system) and publicly traded in the over-the
 2095  counter securities market; is required to file either of Form
 2096  10-K, Form 100, or Form 20-G with the United States Securities
 2097  and Exchange Commission; or has American Depository Receipts
 2098  listed on a recognized stock exchange and publicly traded or is
 2099  the wholly owned subsidiary of a corporation that is listed and
 2100  traded on a recognized stock exchange; is listed in NASDAQ
 2101  (National Association of Security Dealers Automated Quotation
 2102  system) and publicly traded in the over-the-counter securities
 2103  market; is required to file Form 10-K, Form 100, or Form 20-G
 2104  with the United States Securities and Exchange Commission; or
 2105  has American Depository Receipts listed on a recognized stock
 2106  exchange and is publicly traded;
 2107         2. Maintains outstanding debt obligations, if any, rated in
 2108  the top four rating categories by a recognized rating service;
 2109         3. Has and maintains at all times a minimum net worth of
 2110  not less than $10 million as evidenced by audited financial
 2111  statements prepared by an independent certified public
 2112  accountant in accordance with generally accepted accounting
 2113  principles and submitted to the office annually; and
 2114         4. Is authorized to do business in this state; and
 2115         (d) The insurer issuing the contractual liability policy:
 2116         1. Maintains and has maintained for the preceding 5 years,
 2117  policyholder surplus of at least $100 million and is rated “A”
 2118  or higher by A.M. Best Company or has an equivalent rating by
 2119  another rating company acceptable to the office;
 2120         2. Holds a certificate of authority to do business in this
 2121  state and is approved to write this type of coverage; and
 2122         3. Acknowledges to the office quarterly that it insures all
 2123  of the association’s claims exposure under contracts delivered
 2124  in this state.
 2126  If all the preceding conditions are satisfied, then the scope of
 2127  coverage under a contractual liability policy shall not be
 2128  required to exceed an association’s claims exposure under
 2129  service warranty contracts delivered in this state.
 2130         Section 52. Except as otherwise expressly provided in this
 2131  act, this act shall take effect upon becoming a law.