Bill Text: FL S1046 | 2013 | Regular Session | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
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
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 SB 1046 By the Committee on Banking and Insurance; and Senator Brandes 597-03465-13 20131046c1 1 A bill to be entitled 2 An act relating to insurance; amending s. 316.646, 3 F.S.; authorizing a uniform motor vehicle proof-of 4 insurance card to be in an electronic format; 5 providing construction with respect to the parameters 6 of a person’s consent to access information on an 7 electronic device presented to provide proof of 8 insurance; providing immunity from liability to a law 9 enforcement officer for damage to an electronic device 10 presented to provide proof of insurance; authorizing 11 the Department of Highway Safety and Motor Vehicles to 12 adopt rules; amending s. 320.02, F.S.; authorizing 13 insurers to furnish uniform proof-of-purchase cards in 14 an electronic format for use by insureds to prove the 15 purchase of required insurance coverage when 16 registering a motor vehicle; amending s. 554.1021, 17 F.S.; defining the term “authorized inspection 18 agency”; amending s. 554.107, F.S.; requiring the 19 chief inspector of the state boiler inspection program 20 to issue a certificate of competency as a special 21 inspector to certain individuals; specifying how long 22 such certificate remains in effect; amending s. 23 554.109, F.S.; authorizing specified insurers to 24 contract with an authorized inspection agency for 25 boiler inspections; requiring such insurers to 26 annually report the identity of contracted authorized 27 inspection agencies to the Department of Financial 28 Services; amending s. 624.413, F.S.; revising a 29 specified time period applicable to a certified 30 examination that must be filed by a foreign or alien 31 insurer applying for a certificate of authority; 32 amending s. 626.0428, F.S.; requiring each insurance 33 agency to be under the control of an agent licensed to 34 transact certain lines of insurance; authorizing an 35 agent to be in charge of more than one branch office 36 under certain circumstances; providing requirements 37 relating to the designation of an agent in charge; 38 prohibiting an insurance agency from conducting 39 insurance business at a location without a designated 40 agent in charge; providing a definition for the term 41 “agent in charge”; providing that the designated agent 42 in charge is liable for certain acts of misconduct; 43 providing grounds for the Department of Financial 44 Services to order operations to cease at certain 45 insurance agency locations until an agent in charge is 46 properly designated; amending s. 626.112, F.S.; 47 providing licensure exemptions that allow specified 48 individuals or entities to conduct insurance business 49 at specified locations under certain circumstances; 50 revising licensure requirements and penalties with 51 respect to registered insurance agencies; providing 52 that the registration of an approved registered 53 insurance agency automatically converts to an 54 insurance agency license on a specified date; amending 55 s. 626.172, F.S.; revising requirements relating to 56 applications for insurance agency licenses; conforming 57 provisions to changes made by the act; amending s. 58 626.321, F.S.; providing that a limited license to 59 offer motor vehicle rental insurance issued to a 60 business that rents or leases motor vehicles 61 encompasses the employees of such business; amending 62 s. 626.382, F.S.; providing that an insurance agency 63 license continues in force until canceled, suspended, 64 revoked, or terminated; amending s. 626.601, F.S.; 65 revising terminology relating to investigations 66 conducted by the Department of Financial Services and 67 the Office of Insurance Regulation with respect to 68 individuals and entities involved in the insurance 69 industry; repealing s. 626.747, F.S., relating to 70 branch agencies, agents in charge, and the payment of 71 additional county tax under certain circumstances; 72 amending s. 626.8411, F.S.; conforming a cross 73 reference; amending s. 626.8805, F.S.; revising 74 insurance administrator application requirements; 75 amending s. 626.8817, F.S.; authorizing an insurer’s 76 designee to provide certain coverage information to an 77 insurance administrator; authorizing an insurer to 78 subcontract the audit of an insurance administrator; 79 amending s. 626.882, F.S.; prohibiting a person from 80 acting as an insurance administrator without a 81 specific written agreement; amending s. 626.883, F.S.; 82 requiring insurance administrators to furnish 83 fiduciary account records to an insurer’s designee; 84 providing that administrator withdrawals from a 85 fiduciary account be made according to specific 86 written agreements; providing that an insurer’s 87 designee may authorize payment of claims; amending s. 88 626.884, F.S.; revising an insurer’s right of access 89 to certain administrator records; amending s. 626.89, 90 F.S.; revising the deadline for filing certain 91 financial statements; amending s. 626.931, F.S.; 92 deleting provisions requiring a surplus lines agent to 93 file a quarterly affidavit with the Florida Surplus 94 Lines Service Office; amending s. 626.932, F.S.; 95 revising the due date of surplus lines tax; amending 96 s. 626.935, F.S.; conforming provisions to changes 97 made by the act; amending s. 626.936, F.S.; conforming 98 provisions to changes made by the act; amending s. 99 627.062, F.S.; requiring the Office of Insurance 100 Regulation to use certain models or straight averages 101 of certain models to estimate hurricane losses when 102 determining whether the rates in a rate filing are 103 excessive, inadequate, or unfairly discriminatory; 104 amending s. 627.0628, F.S.; increasing the length of 105 time during which an insurer must adhere to certain 106 findings made by the Commission on Hurricane Loss 107 Projection Methodology with respect to certain 108 methods, principles, standards, models, or output 109 ranges used in a rate finding; providing that the 110 requirement to adhere to such findings does not limit 111 an insurer from using a straight average of results of 112 certain models or output ranges under specified 113 circumstances; amending s. 627.072, F.S.; authorizing 114 retrospective rating plans relating to workers’ 115 compensation and employer’s liability insurance to 116 allow negotiations between certain employers and 117 insurers with respect to rating factors used to 118 calculate premiums; amending s. 627.281, F.S.; 119 conforming a cross-reference; repealing s. 627.3519, 120 F.S., relating to an annual report from the Financial 121 Services Commission to the Legislature of aggregate 122 net probable maximum losses, financing options, and 123 potential assessments of the Florida Hurricane 124 Catastrophe Fund and Citizens Property Insurance 125 Corporation; amending s. 627.4133, F.S.; increasing 126 the amount of prior notice required with respect to 127 the nonrenewal, cancellation, or termination of 128 certain insurance policies; deleting certain 129 provisions that require extended periods of prior 130 notice with respect to the nonrenewal, cancellation, 131 or termination of certain insurance policies; 132 prohibiting the cancellation of certain policies that 133 have been in effect for a specified amount of time 134 except under certain circumstances; amending s. 135 627.4137, F.S.; adding licensed company adjusters to 136 the list of persons who may respond to a claimant’s 137 written request for information relating to liability 138 insurance coverage; amending s. 627.421, F.S.; 139 authorizing the electronic delivery of certain 140 insurance documents; amending s. 627.43141, F.S.; 141 authorizing a notice of change in policy terms to be 142 sent in a separate mailing to an insured under certain 143 circumstances; requiring an insurer to provide such 144 notice to the insured’s insurance agent; amending s. 145 627.6484, F.S.; providing that coverage for each 146 policyholder of the Florida Comprehensive Health 147 Association terminates on a specified date; requiring 148 the association to provide assistance to 149 policyholders; requiring the association to notify 150 policyholders of termination of coverage and provide 151 information concerning how to obtain other coverage; 152 requiring the association to impose a final assessment 153 or provide a refund to member insurers, sell or 154 dispose of physical assets, perform a final 155 accounting, legally dissolve the association, submit a 156 required report, and transfer all records to the 157 Office of Insurance Regulation; repealing s. 158 627.64872, F.S., relating to the Florida Health 159 Insurance Plan; providing for the future repeal of ss. 160 627.648, 627.6482, 627.6484, 627.6486, 627.6488, 161 627.6489, 627.649, 627.6492, 627.6494, 627.6496, 162 627.6498, and 627.6499, F.S., relating to the Florida 163 Comprehensive Health Association Act, definitions, 164 termination of enrollment and availability of other 165 coverage, eligibility, the Florida Comprehensive 166 Health Association, the Disease Management Program, 167 the administrator of the health insurance plan, 168 participation of insurers, insurer assessments, 169 deferment, and assessment limitations, issuing of 170 policies, minimum benefits coverage and exclusions, 171 premiums, and deductibles, and reporting by insurers 172 and third-party administrators, respectively; amending 173 s. 627.701, F.S.; revising requirements to issue or 174 renew personal lines residential property insurance 175 after a certain date; increasing the deductible amount 176 for losses from perils other than hurricane; amending 177 s. 627.7015, F.S.; revising the rulemaking authority 178 of the department with respect to qualifications and 179 specified types of penalties covered under the 180 property insurance mediation program; creating s. 181 627.70151, F.S.; providing criteria for an insurer or 182 policyholder to challenge the impartiality of a loss 183 appraisal umpire for purposes of disqualifying such 184 umpire; amending s. 627.706, F.S.; revising the 185 definition of the term “neutral evaluator”; amending 186 s. 627.7074, F.S.; requiring the department to adopt 187 rules relating to the certification of neutral 188 evaluators; amending s. 627.736, F.S.; revising the 189 time period for applicability of certain Medicare fee 190 schedules or payment limitations; amending s. 627.745, 191 F.S.; revising qualifications for approval as a 192 mediator by the department; providing grounds for the 193 department to deny an application, or suspend or 194 revoke approval of a mediator or certification of a 195 neutral evaluator; authorizing the department to adopt 196 rules; amending s. 627.841, F.S.; providing that an 197 insurance premium finance company may impose a fee for 198 payments returned due to insufficient funds; amending 199 s. 627.952, F.S.; providing that certain persons who 200 are not residents of this state must be licensed and 201 appointed as nonresident surplus lines agents in this 202 state in order to engage in specified activities with 203 respect to servicing insurance contracts, 204 certificates, or agreements for purchasing or risk 205 retention groups; deleting a fidelity bond requirement 206 applicable to certain nonresident agents who are 207 licensed as surplus lines agents in another state; 208 amending ss. 627.971 and 627.972, F.S.; including 209 licensed mutual insurers in financial guaranty 210 insurance corporations; amending s. 628.901, F.S.; 211 revising the definition of terms applicable to captive 212 insurers; amending s. 628.905, F.S.; authorizing an 213 industrial insured captive insurance company to write 214 workers compensation and employer liability insurance 215 in excess of a certain amount under certain 216 conditions; conforming provisions to changes made by 217 the act; redesignating the Office of Insurance 218 Regulation instead of the Insurance Commissioner as 219 the collector of certain fees and issuer of licenses; 220 amending s. 628.907, F.S.; conforming provisions to 221 changes made by the act; amending s. 628.909, F.S.; 222 providing for applicability of certain provisions of 223 the Insurance Code to specified captive insurers; 224 conforming provisions to changes made by the act; 225 amending s. 628.9142, F.S.; conforming provisions to 226 changes made by the act; amending s. 628.915, F.S.; 227 conforming provisions to changes made by the act; 228 amending s. 628.917, F.S.; conforming provisions to 229 changes made by the act; amending s. 628.919, F.S.; 230 requiring a pure captive insurance company to submit 231 certain risk management standards to the Office of 232 Insurance Regulation; amending s. 634.406, F.S.; 233 revising criteria authorizing premiums of certain 234 service warranty associations to exceed their 235 specified net assets limitations; revising 236 requirements relating to contractual liability 237 policies that insure warranty associations; providing 238 an effective date. 239 240 Be It Enacted by the Legislature of the State of Florida: 241 242 Section 1. Subsection (1) of section 316.646, Florida 243 Statutes, is amended, and subsection (5) is added to that 244 section, to read: 245 316.646 Security required; proof of security and display 246 thereof; dismissal of cases.— 247 (1) AAnyperson required by s. 324.022 to maintain 248 property damage liability security, required by s. 324.023 to 249 maintain liability security for bodily injury or death, or 250 required by s. 627.733 to maintain personal injury protection 251 security on a motor vehicle shall have in his or her immediate 252 possession at all times while operating such motor vehicle 253 proper proof of maintenance of the required security. Such proof 254 shall be a uniform proof-of-insurance card, in paper or 255 electronic format, in a form prescribed by the department, a 256 valid insurance policy, an insurance policy binder, a 257 certificate of insurance, or such other proof as may be 258 prescribed by the department. If a person presents an electronic 259 device to a law enforcement officer for the purpose of 260 displaying a proof-of-insurance card in an electronic format: 261 (a) The person presenting the device is not deemed to 262 consent to access to any information on the electronic device 263 other than the displayed proof-of-insurance card. 264 (b) The law enforcement officer is not liable for damage to 265 the electronic device. 266 (5) The department may adopt rules to implement this 267 section. 268 Section 2. Paragraph (a) of subsection (5) of section 269 320.02, Florida Statutes, is amended to read: 270 320.02 Registration required; application for registration; 271 forms.— 272 (5)(a) Proof that personal injury protection benefits have 273 been purchased when required under s. 627.733, that property 274 damage liability coverage has been purchased as required under 275 s. 324.022, that bodily injury or death coverage has been 276 purchased if required under s. 324.023, and that combined bodily 277 liability insurance and property damage liability insurance have 278 been purchased when required under s. 627.7415 shall be provided 279 in the manner prescribed by law by the applicant at the time of 280 application for registration of any motor vehicle that is 281 subject to such requirements. The issuing agent shall refuse to 282 issue registration if such proof of purchase is not provided. 283 Insurers shall furnish uniform proof-of-purchase cards, in paper 284 or electronic format, in a form prescribed by the department and 285 shall include the name of the insured’s insurance company, the 286 coverage identification number, and the make, year, and vehicle 287 identification number of the vehicle insured. The card must 288shallcontain a statement notifying the applicant of the penalty 289 specified in s. 316.646(4). The card or insurance policy, 290 insurance policy binder, or certificate of insurance or a 291 photocopy of any of these; an affidavit containing the name of 292 the insured’s insurance company, the insured’s policy number, 293 and the make and year of the vehicle insured; or such other 294 proof as may be prescribed by the department constitutesshall295constitutesufficient proof of purchase. If an affidavit is 296 provided as proof, it mustshallbe in substantially the 297 following form: 298 299 Under penalty of perjury, I ...(Name of insured)... do hereby 300 certify that I have ...(Personal Injury Protection, Property 301 Damage Liability, and, when required, Bodily Injury 302 Liability)... Insurance currently in effect with ...(Name of 303 insurance company)... under ...(policy number)... covering 304 ...(make, year, and vehicle identification number of 305 vehicle).... ...(Signature of Insured)... 306 307 Such affidavit shall include the following warning: 308 309 WARNING: GIVING FALSE INFORMATION IN ORDER TO OBTAIN A VEHICLE 310 REGISTRATION CERTIFICATE IS A CRIMINAL OFFENSE UNDER FLORIDA 311 LAW. ANYONE GIVING FALSE INFORMATION ON THIS AFFIDAVIT IS 312 SUBJECT TO PROSECUTION. 313 314 When an application is made through a licensed motor vehicle 315 dealer as required in s. 319.23, the original or a photostatic 316 copy of such card, insurance policy, insurance policy binder, or 317 certificate of insurance or the original affidavit from the 318 insured shall be forwarded by the dealer to the tax collector of 319 the county or the Department of Highway Safety and Motor 320 Vehicles for processing. By executing the aforesaid affidavit, 321 no licensed motor vehicle dealer will be liable in damages for 322 any inadequacy, insufficiency, or falsification of any statement 323 contained therein. A card shall also indicate the existence of 324 any bodily injury liability insurance voluntarily purchased. 325 Section 3. Subsection (8) is added to section 554.1021, 326 Florida Statutes, to read: 327 554.1021 Definitions.—As used in ss. 554.1011-554.115: 328 (8) “Authorized inspection agency” means: 329 (a) A county, city, town, or other governmental subdivision 330 that has adopted and administers, at a minimum, Section I of the 331 A.S.M.E. Boiler and Pressure Vessel Code as a legal requirement 332 and whose inspectors hold valid certificates of competency in 333 accordance with s. 554.113; or 334 (b) An insurance company that is licensed or registered by 335 an appropriate authority of any state of the United States or 336 province of Canada and whose inspectors hold valid certificates 337 of competency in accordance with s. 554.113. 338 Section 4. Section 554.107, Florida Statutes, is amended to 339 read: 340 554.107 Special inspectors.— 341 (1) Upon application byanyan authorized inspection agency 342company licensed to insure boilers in this state, the chief 343 inspector shall issue a certificate of competency as a special 344 inspector to ananyinspector employed by the agency if he or 345 shecompany, provided that such inspectorsatisfies the 346 competency requirements for inspectors as provided in s. 347 554.113. 348 (2) The certificate of competency of a special inspector 349 remainsshall remainin effect only so long as the special 350 inspector is employed by an authorized inspection agencya351company licensed to insure boilers in this state. Upon 352 termination of employment with such agencycompany, a special 353 inspector shall, in writing, notify the chief inspector of such 354 termination. Such notice shall be given within 15 days following 355 the date of termination. 356 Section 5. Subsection (1) of section 554.109, Florida 357 Statutes, is amended to read: 358 554.109 Exemptions.— 359 (1) AnAnyinsurance company that insuresinsuringa boiler 360 located in a public assembly location in this state shall 361 inspect or contract with an authorized inspection agency to 362 inspect such boilerso insured,and shall annually report to the 363 department the identity of the authorized inspection agency that 364 performs a required boiler inspection on behalf of the company. 365 Aanycounty, city, town, or other governmental subdivision that 366whichhas adopted into law the Boiler and Pressure Vessel Code 367 of the American Society of Mechanical Engineers and the National 368 Board Inspection Code for the construction, installation, 369 inspection, maintenance, and repair of boilers, regulating such 370 boilers in public assembly locations, shall inspect such boilers 371 so regulated; provided that such inspection shall be conducted 372 by a special inspector licensed pursuant to ss. 554.1011 373 554.115. Upon filing of a report of satisfactory inspection with 374 the department, such boiler is exempt from inspection by the 375 department. 376 Section 6. Paragraph (f) of subsection (1) of section 377 624.413, Florida Statutes, is amended to read: 378 624.413 Application for certificate of authority.— 379 (1) To apply for a certificate of authority, an insurer 380 shall file its application therefor with the office, upon a form 381 adopted by the commission and furnished by the office, showing 382 its name; location of its home office and, if an alien insurer, 383 its principal office in the United States; kinds of insurance to 384 be transacted; state or country of domicile; and such additional 385 information as the commission reasonably requires, together with 386 the following documents: 387 (f) If a foreign or alien insurer, a copy of the report of 388 the most recent examination of the insurer certified by the 389 public official having supervision of insurance in its state of 390 domicile or of entry into the United States. The end of the most 391 recent year covered by the examination must be within the 5-year 3923-yearperiod preceding the date of application. In lieu of the 393 certified examination report, the office may accept an audited 394 certified public accountant’s report prepared on a basis 395 consistent with the insurance laws of the insurer’s state of 396 domicile, certified by the public official having supervision of 397 insurance in its state of domicile or of entry into the United 398 States. 399 Section 7. Subsection (4) is added to section 626.0428, 400 Florida Statutes, to read: 401 626.0428 Agency personnel powers, duties, and limitations.— 402 (4)(a) Each place of business established by an agent or 403 agency, firm, corporation, or association must be in the active 404 full-time charge of a licensed and appointed agent holding the 405 required agent licenses to transact the lines of insurance being 406 handled at the location. 407 (b) Notwithstanding paragraph (a), the licensed agent in 408 charge of an insurance agency may also be the agent in charge of 409 additional branch office locations of the agency if insurance 410 activities requiring licensure as an insurance agent do not 411 occur at any location when the agent is not physically present 412 and unlicensed employees at the location do not engage in 413 insurance activities requiring licensure as an insurance agent 414 or customer representative. 415 (c) An insurance agency and each branch place of business 416 of an insurance agency shall designate an agent in charge and 417 file the name and license number of the agent in charge and the 418 physical address of the insurance agency location with the 419 department at the department’s designated website. The 420 designation of the agent in charge may be changed at the option 421 of the agency. A change of the designated agent in charge is 422 effective upon notification to the department, which shall be 423 provided within 30 days after such change. 424 (d) For the purposes of this subsection, an “agent in 425 charge” is the licensed and appointed agent who is responsible 426 for the supervision of all individuals within an insurance 427 agency location, regardless of whether such individuals deal 428 with the general public in the solicitation or negotiation of 429 insurance contracts or the collection or accounting of moneys. 430 (e) An agent in charge of an insurance agency is 431 accountable for wrongful acts, misconduct, or violations of 432 provisions of this code committed by the agent or by any person 433 under his or her supervision while acting on behalf of the 434 agency. This section may not be construed to render the agent in 435 charge criminally liable for an act unless he or she personally 436 committed or knew or should have known of the act and of the 437 facts constituting a violation of this chapter. 438 (f) An insurance agency location may not conduct the 439 business of insurance unless the agency designates an agent in 440 charge at all times. If the agency fails to update the 441 designation of the agent in charge within 90 days after the date 442 of a change in designation, the department shall automatically 443 revoke the agency’s license. 444 Section 8. Subsection (7) of section 626.112, Florida 445 Statutes, is amended to read: 446 626.112 License and appointment required; agents, customer 447 representatives, adjusters, insurance agencies, service 448 representatives, managing general agents.— 449 (7)(a)Effective October 1, 2006,No individual, firm, 450 partnership, corporation, association, or any other entity shall 451 act in its own name or under a trade name, directly or 452 indirectly, as an insurance agency, unless it complies with s. 453 626.172 with respect to possessing an insurance agency license 454 for each place of business at which it engages in anany455 activity thatwhichmay be performed only by a licensed 456 insurance agent. However, an insurance agency that is owned and 457 operated by a single licensed agent conducting business in his 458 or her individual name and not employing or otherwise using the 459 services of or appointing other licensees is exempt from the 460 agency licensing requirements of this subsection. A branch place 461 of business that is established by a licensed agency is 462 considered a branch agency and is not required to be licensed so 463 long as it transacts business under the same name and federal 464 tax identification number as the licensed agency and has 465 designated a licensed agent in charge of the location as 466 required by s. 626.0428 and the address and telephone number of 467 the location have been submitted to the department for inclusion 468 in the licensing record of the licensed agency within 30 days 469 after insurance transactions begin at the locationEach agency470engaged in business in this state before January 1, 2003, which471is wholly owned by insurance agents currently licensed and472appointed under this chapter, each incorporated agency whose473voting shares are traded on a securities exchange, each agency474designated and subject to supervision and inspection as a branch475office under the rules of the National Association of Securities476Dealers, and each agency whose primary function is offering477insurance as a service or member benefit to members of a478nonprofit corporation may file an application for registration479in lieu of licensure in accordance with s.626.172(3).Each480agency engaged in business before October 1, 2006, shall file an481application for licensure or registration on or before October4821, 2006.483 (b)1.If an agency is required to be licensed but fails to 484 file an application for licensure in accordance with this 485 section, the department shall impose on the agency an 486 administrative penalty in an amount of up to $10,000. 4872. If an agency is eligible for registration but fails to488file an application for registration or an application for489licensure in accordance with this section, the department shall490impose on the agency an administrative penalty in an amount of491up to $5,000.492 (c)(b)Effective October 1, 2013, the department must 493 automatically convert the registration of an approveda494 registered insurance agency toshall, as a condition precedent495to continuing business, obtainan insurance agency licenseif496the department finds that, with respect to any majority owner,497partner, manager, director, officer, or other person who manages498or controls the agency, any person has:4991. Been found guilty of, or has pleaded guilty or nolo500contendere to, a felony in this state or any other state501relating to the business of insurance or to an insurance agency,502without regard to whether a judgment of conviction has been503entered by the court having jurisdiction of the cases. 5042. Employed any individual in a managerial capacity or in a505capacity dealing with the public who is under an order of506revocation or suspension issued by the department. An insurance507agency may request, on forms prescribed by the department,508verification of any person’s license status. If a request is509mailed within 5 working days after an employee is hired, and the510employee’s license is currently suspended or revoked, the agency511shall not be required to obtain a license, if the unlicensed512person’s employment is immediately terminated.5133. Operated the agency or permitted the agency to be514operated in violation of s.626.747.5154. With such frequency as to have made the operation of the516agency hazardous to the insurance-buying public or other517persons:518a. Solicited or handled controlled business. This519subparagraph shall not prohibit the licensing of any lending or520financing institution or creditor, with respect to insurance521only, under credit life or disability insurance policies of522borrowers from the institutions, which policies are subject to523part IX of chapter 627.524b. Misappropriated, converted, or unlawfully withheld525moneys belonging to insurers, insureds, beneficiaries, or others526and received in the conduct of business under the license.527c. Unlawfully rebated, attempted to unlawfully rebate, or528unlawfully divided or offered to divide commissions with529another.530d. Misrepresented any insurance policy or annuity contract,531or used deception with regard to any policy or contract, done532either in person or by any form of dissemination of information533or advertising.534e. Violated any provision of this code or any other law535applicable to the business of insurance in the course of dealing536under the license.537f. Violated any lawful order or rule of the department.538g. Failed or refused, upon demand, to pay over to any539insurer he or she represents or has represented any money coming540into his or her hands belonging to the insurer.541h. Violated the provision against twisting as defined in s.542626.9541(1)(l).543i. In the conduct of business, engaged in unfair methods of544competition or in unfair or deceptive acts or practices, as545prohibited under part IX of this chapter.546j. Willfully overinsured any property insurance risk.547k. Engaged in fraudulent or dishonest practices in the548conduct of business arising out of activities related to549insurance or the insurance agency.550l. Demonstrated lack of fitness or trustworthiness to551engage in the business of insurance arising out of activities552related to insurance or the insurance agency.553m. Authorized or knowingly allowed individuals to transact554insurance who were not then licensed as required by this code.5555. Knowingly employed any person who within the preceding 3556years has had his or her relationship with an agency terminated557in accordance with paragraph (d).5586. Willfully circumvented the requirements or prohibitions559of this code.560 Section 9. Subsections (2), (3), and (4) of section 561 626.172, Florida Statutes, are amended to read: 562 626.172 Application for insurance agency license.— 563 (2) An application for an insurance agency license must 564shallbe signed by the owner or owners of the agency. If the 565 agency is incorporated, the application mustshallbe signed by 566 the president and secretary of the corporation. The application 567 for an insurance agency license mustshallinclude: 568 (a) The name of each majority owner, partner, officer, and 569 director of the insurance agency. 570 (b) The residence address of each person required to be 571 listed in the application under paragraph (a). 572 (c) The name of the insurance agency,andits principal 573 business street address and a valid e-mail address of the 574 insurance agency. 575 (d) The physical addresslocationof each branch agency, 576 including its name, e-mail address, and telephone number and the 577 date that the branch location began transacting insuranceoffice578and the name under which each agency office conducts or will579conduct business. 580 (e) The name of each agent to be in full-time charge of an 581 agency office and specification of which office, including 582 branch locations. 583 (f) The fingerprints of each of the following: 584 1. A sole proprietor; 585 2. Each partner; 586 3. Each owner of an unincorporated agency; 587 4. Each owner who directs or participates in the management 588 or control of an incorporated agency whose shares are not traded 589 on a securities exchange; 590 5. The president, senior vice presidents, treasurer, 591 secretary, and directors of the agency; and 592 6. Any other person who directs or participates in the 593 management or control of the agency, whether through the 594 ownership of voting securities, by contract, by ownership of 595 agency bank accounts, or otherwise. 596 597 Fingerprints must be taken by a law enforcement agency or other 598 entity approved by the department and must be accompanied by the 599 fingerprint processing fee specified in s. 624.501. Fingerprints 600 mustshallbe processed in accordance with s. 624.34. However, 601 fingerprints need not be filed for ananyindividual who is 602 currently licensed and appointed under this chapter. This 603 paragraph does not apply to corporations whose voting shares are 604 traded on a securities exchange. 605 (g) Such additional information as the department requires 606 by rule to ascertain the trustworthiness and competence of 607 persons required to be listed on the application and to 608 ascertain that such persons meet the requirements of this code. 609 However, the department may not require that credit or character 610 reports be submitted for persons required to be listed on the 611 application. 612 (h)Beginning October 1, 2005,The department mustshall613 accept the uniform application for nonresident agency licensure. 614 The department may adopt by rule revised versions of the uniform 615 application. 616(3) The department shall issue a registration as an617insurance agency to any agency that files a written application618with the department and qualifies for registration. The619application for registration shall require the agency to provide620the same information required for an agency licensed under621subsection (2), the agent identification number for each owner622who is a licensed agent, proof that the agency qualifies for623registration as provided in s.626.112(7), and any other624additional information that the department determines is625necessary in order to demonstrate that the agency qualifies for626registration. The application must be signed by the owner or627owners of the agency. If the agency is incorporated, the628application must be signed by the president and the secretary of629the corporation. An agent who owns the agency need not file630fingerprints with the department if the agent obtained a license631under this chapter and the license is currently valid.632(a) If an application for registration is denied, the633agency must file an application for licensure no later than 30634days after the date of the denial of registration.635(b) A registered insurance agency must file an application636for licensure no later than 30 days after the date that any637person who is not a licensed and appointed agent in this state638acquires any ownership interest in the agency. If an agency639fails to file an application for licensure in compliance with640this paragraph, the department shall impose an administrative641penalty in an amount of up to $5,000 on the agency.642(c) Sections626.6115and626.6215do not apply to agencies643registered under this subsection.644 (3)(4)The department mustshallissue a licenseor645registrationto each agency upon approval of the application, 646 and each agency location mustshalldisplay the licenseor647registrationprominently in a manner that makes it clearly 648 visible to aanycustomer or potential customer who enters the 649 agency. 650 Section 10. Paragraph (d) of subsection (1) of section 651 626.321, Florida Statutes, is amended to read: 652 626.321 Limited licenses.— 653 (1) The department shall issue to a qualified applicant a 654 license as agent authorized to transact a limited class of 655 business in any of the following categories of limited lines 656 insurance: 657 (d) Motor vehicle rental insurance.— 658 1. License covering only insurance of the risks set forth 659 in this paragraph when offered, sold, or solicited with and 660 incidental to the rental or lease of a motor vehicle and which 661 applies only to the motor vehicle that is the subject of the 662 lease or rental agreement and the occupants of the motor 663 vehicle: 664 a. Excess motor vehicle liability insurance providing 665 coverage in excess of the standard liability limits provided by 666 the lessor in the lessor’s lease to a person renting or leasing 667 a motor vehicle from the licensee’s employer for liability 668 arising in connection with the negligent operation of the leased 669 or rented motor vehicle. 670 b. Insurance covering the liability of the lessee to the 671 lessor for damage to the leased or rented motor vehicle. 672 c. Insurance covering the loss of or damage to baggage, 673 personal effects, or travel documents of a person renting or 674 leasing a motor vehicle. 675 d. Insurance covering accidental personal injury or death 676 of the lessee and any passenger who is riding or driving with 677 the covered lessee in the leased or rented motor vehicle. 678 2. Insurance under a motor vehicle rental insurance license 679 may be issued only if the lease or rental agreement is for no 680 more than 60 days, the lessee is not provided coverage for more 681 than 60 consecutive days per lease period, and the lessee is 682 given written notice that his or her personal insurance policy 683 providing coverage on an owned motor vehicle may provide 684 coverage of such risks and that the purchase of the insurance is 685 not required in connection with the lease or rental of a motor 686 vehicle. If the lease is extended beyond 60 days, the coverage 687 may be extended one time only for a period not to exceed an 688 additional 60 days. Insurance may be provided to the lessee as 689 an additional insured on a policy issued to the licensee’s 690 employer. 691 3. The license may be issued only to the full-time salaried 692 employee of a licensed general lines agent or to a business 693 entity that offers motor vehicles for rent or lease if insurance 694 sales activities authorized by the license are in connection 695 with and incidental to the rental or lease of a motor vehicle. 696 a. A license issued to a business entity that offers motor 697 vehicles for rent or lease encompasses each office, branch 698 office, employee, or place of business making use of the 699 entity’s business name in order to offer, solicit, and sell 700 insurance pursuant to this paragraph. 701 b. The application for licensure must list the name, 702 address, and phone number for each office, branch office, or 703 place of business that is to be covered by the license. The 704 licensee shall notify the department of the name, address, and 705 phone number of any new location that is to be covered by the 706 license before the new office, branch office, or place of 707 business engages in the sale of insurance pursuant to this 708 paragraph. The licensee must notify the department within 30 709 days after closing or terminating an office, branch office, or 710 place of business. Upon receipt of the notice, the department 711 shall delete the office, branch office, or place of business 712 from the license. 713 c. A licensed and appointed entity is directly responsible 714 and accountable for all acts of the licensee’s employees. 715 Section 11. Section 626.382, Florida Statutes, is amended 716 to read: 717 626.382 Continuation, expiration of license; insurance 718 agencies.—An insurance agency license continuesThe license of719any insurance agencyshall be issued for a period of 3 years and720shall continuein force until it is canceled, suspended, 721 revoked, or otherwise terminated.A license may be renewed by722submitting a renewal request to the department on a form adopted723by department rule.724 Section 12. Section 626.601, Florida Statutes, is amended 725 to read: 726 626.601 Improper conduct; inquiry; fingerprinting.— 727 (1) The department or office may, upon its own motion or 728 upon a written complaint signed by ananyinterested person and 729 filed with the department or office, inquire into any alleged 730 improper conduct of aanylicensed, approved, or certified 731 insurance agency, agent, adjuster, service representative, 732 managing general agent, customer representative, title insurance 733 agent, title insurance agency, mediator, neutral evaluator, 734 continuing education course provider, instructor, school 735 official, or monitor group under this code. The department or 736 office may thereafter initiate an investigation ofanysuch 737 individual or entitylicenseeif it has reasonable cause to 738 believe that the individual or entitylicenseehas violated any 739 provision of the insurance code. During the course of its 740 investigation, the department or office shall contact the 741 individual or entitylicenseebeing investigated unless it 742 determines that contacting such individual or entityperson743 could jeopardize the successful completion of the investigation 744 or cause injury to the public. 745 (2) In the investigation by the department or office of the 746 alleged misconduct, the individual or entitylicenseeshall, 747 whenever so required by the department or office, cause the 748 individual’s or entity’shis or herbooks and records to be open 749 for inspection for the purpose of such inquiries. 750 (3) The complaints against an individual or entityany751licenseemay be informally alleged and are not required to 752 include languageneed not be in any such language as is753 necessary to charge a crime on an indictment or information. 754 (4) The expense foranyhearings or investigations 755 conducted under this law, as well as the fees and mileage of 756 witnesses, may be paid out of the appropriate fund. 757 (5) If the department or office, after investigation, has 758 reason to believe that an individuala licenseemay have been 759 found guilty of or pleaded guilty or nolo contendere to a felony 760 or a crime related to the business of insurance in this or any 761 other state or jurisdiction, the department or office may 762 require the individuallicenseeto file with the department or 763 office a complete set of his or her fingerprints, which must 764shallbe accompanied by the fingerprint processing fee set forth 765 in s. 624.501. The fingerprints shall be taken by an authorized 766 law enforcement agency or other department-approved entity. 767 (6) The complaint andanyinformation obtained pursuant to 768 the investigation by the department or office are confidential 769 and are exempt fromthe provisions ofs. 119.07, unless the 770 department or office files a formal administrative complaint, 771 emergency order, or consent order against the individual or 772 entitylicensee.Nothing inThis subsection does notshall be773construed toprevent the department or office from disclosing 774 the complaint or such information as it deems necessary to 775 conduct the investigation, to update the complainant as to the 776 status and outcome of the complaint, or to share such 777 information with aanylaw enforcement agency. 778 Section 13. Section 626.747, Florida Statutes, is repealed. 779 Section 14. Paragraph (b) of subsection (1) of section 780 626.8411, Florida Statutes, is amended to read: 781 626.8411 Application of Florida Insurance Code provisions 782 to title insurance agents or agencies.— 783 (1) The following provisions of part II applicable to 784 general lines agents or agencies also apply to title insurance 785 agents or agencies: 786 (b) Section 626.0428(4)(a) and (b)626.747, relating to 787 branch agencies. 788 Section 15. Paragraph (c) of subsection (2) and subsection 789 (3) of section 626.8805, Florida Statutes, is amended to read: 790 626.8805 Certificate of authority to act as administrator.— 791 (2) The administrator shall file with the office an 792 application for a certificate of authority upon a form to be 793 adopted by the commission and furnished by the office, which 794 application shall include or have attached the following 795 information and documents: 796 (c) The names, addresses, official positions, and 797 professional qualifications of the individuals who are employed 798 or retained by the administrator and who are responsible for the 799 conduct of the affairs of the administrator, including all 800 members of the board of directors, board of trustees, executive 801 committee, or other governing board or committee, and the 802 principal officers in the case of a corporation or,the partners 803 or members in the case of a partnership or association of the 804 administrator, and any other person who exercises control or805influence over the affairs of the administrator. 806 (3) The applicant shall make available for inspection by 807 the office copies of all contracts relating to services provided 808 by the administrator towithinsurers or other persons utilizing 809 the services of the administrator. 810 Section 16. Subsections (1) and (3) of section 626.8817, 811 Florida Statutes, are amended to read: 812 626.8817 Responsibilities of insurance company with respect 813 to administration of coverage insured.— 814 (1) If an insurer uses the services of an administrator, 815 the insurer is responsible for determining the benefits, premium 816 rates, underwriting criteria, and claims payment procedures 817 applicable to the coverage and for securing reinsurance, if any. 818 The rules pertaining to these matters shall be provided,in 819 writing,by the insurer, or its designee, to the administrator. 820 The responsibilities of the administrator as to any of these 821 matters shall be set forth in athewritten agreement binding 822 uponbetweenthe administrator and the insurer. 823 (3) In cases in which an administrator administers benefits 824 for more than 100 certificateholders on behalf of an insurer, 825 the insurer shall, at least semiannually, conduct a review of 826 the operations of the administrator. At least one such review 827 must be an onsite audit of the operations of the administrator. 828 The insurer may contract with a qualified third party to conduct 829 such examination. 830 Section 17. Subsections (1) and (4) of section 626.882, 831 Florida Statutes, are amended to read: 832 626.882 Agreement between administrator and insurer; 833 required provisions; maintenance of records.— 834 (1) ANoperson may not act as an administrator without a 835 written agreement, as required under s. 626.8817, which 836 specifies the rights, duties and obligations of thebetween such837person asadministrator andaninsurer. 838 (4) If a policy is issued to a trustee or trustees, a copy 839 of the trust agreement and any amendments to that agreement 840 shall be furnished to the insurer or its designee by the 841 administrator and shall be retained as part of the official 842 records of both the administrator and the insurer for the 843 duration of the policy and for 5 years thereafter. 844 Section 18. Subsections (3), (4), and (5) of section 845 626.883, Florida Statutes, are amended to read: 846 626.883 Administrator as intermediary; collections held in 847 fiduciary capacity; establishment of account; disbursement; 848 payments on behalf of insurer.— 849 (3) If charges or premiums deposited in a fiduciary account 850 have been collected on behalf of or for more than one insurer, 851 the administrator shall keep records clearly recording the 852 deposits in and withdrawals from such account on behalf of or 853 for each insurer. The administrator shall, upon request of an 854 insurer or its designee, furnish such insurer with copies of 855 records pertaining to deposits and withdrawals on behalf of or 856 for such insurer. 857 (4) The administrator may not pay aanyclaim by 858 withdrawals from a fiduciary account. Withdrawals from such 859 account shall be made as provided in the written agreement 860 required under ss. 626.8817 and 626.882between the861administrator and the insurerfor any of the following: 862 (a) Remittance to an insurer entitled to such remittance. 863 (b) Deposit in an account maintained in the name of such 864 insurer. 865 (c) Transfer to and deposit in a claims-paying account, 866 with claims to be paid as provided by such insurer. 867 (d) Payment to a group policyholder for remittance to the 868 insurer entitled to such remittance. 869 (e) Payment to the administrator of the commission, fees, 870 or charges of the administrator. 871 (f) Remittance of return premium to the person or persons 872 entitled to such return premium. 873 (5) All claims paid by the administrator from funds 874 collected on behalf of the insurer shall be paid only on drafts 875 of, and as authorized by, such insurer or its designee. 876 Section 19. Subsection (3) of section 626.884, Florida 877 Statutes, is amended to read: 878 626.884 Maintenance of records by administrator; access; 879 confidentiality.— 880 (3) The insurer shall retain the right of continuing access 881 to books and records maintained by the administrator sufficient 882 to permit the insurer to fulfill all of its contractual 883 obligations to insured persons, subject to any restrictions in 884 the written agreement pertaining tobetween the insurer and the885administrator onthe proprietary rights of the parties in such 886 books and records. 887 Section 20. Subsections (1) and (2) of section 626.89, 888 Florida Statutes, are amended to read: 889 626.89 Annual financial statement and filing fee; notice of 890 change of ownership.— 891 (1) Each authorized administrator shall file with the 892 office a full and true statement of its financial condition, 893 transactions, and affairs. The statement shall be filed annually 894 on or before AprilMarch1 or within such extension of time 895 therefor as the office for good cause may have granted and shall 896 be for the preceding calendar year or fiscal year, if the 897 administrator’s accounting is on a fiscal year basis. The 898 statement shall be in such form and contain such matters as the 899 commission prescribes and shall be verified by at least two 900 officers of such administrator.An administrator whose sole901stockholder is an association representing health care providers902which is not an affiliate of an insurer, an administrator of a903pooled governmental self-insurance program, or an administrator904that is a university may submit the preceding fiscal year’s905statement within 2 months after its fiscal year end.906 (2) Each authorized administrator shall also file an 907 audited financial statement performed by an independent 908 certified public accountant. The audited financial statement 909 shall be filed with the office on or before JulyJune1 for the 910 preceding calendar or fiscal yearending December 31.An911administrator whose sole stockholder is an association912representing health care providers which is not an affiliate of913an insurer, an administrator of a pooled governmental self914insurance program, or an administrator that is a university may915submit the preceding fiscal year’s audited financial statement916within 5 months after the end of its fiscal year.An audited 917 financial statement prepared on a consolidated basis must 918 include a columnar consolidating or combining worksheet that 919 must be filed with the statement and must comply with the 920 following: 921 (a) Amounts shown on the consolidated audited financial 922 statement must be shown on the worksheet; 923 (b) Amounts for each entity must be stated separately; and 924 (c) Explanations of consolidating and eliminating entries 925 must be included. 926 Section 21. Section 626.931, Florida Statutes, is amended 927 to read: 928 626.931Agent affidavit andInsurer reporting 929 requirements.— 930(1) Each surplus lines agent shall on or before the 45th931day following each calendar quarter file with the Florida932Surplus Lines Service Office an affidavit, on forms as933prescribed and furnished by the Florida Surplus Lines Service934Office, stating that all surplus lines insurance transacted by935him or her during such calendar quarter has been submitted to936the Florida Surplus Lines Service Office as required.937(2) The affidavit of the surplus lines agent shall include938efforts made to place coverages with authorized insurers and the939results thereof.940 (1)(3)Each foreign insurer accepting premiums shall, on or 941 before the end of the month following each calendar quarter, 942 file with the Florida Surplus Lines Service Office a verified 943 report of all surplus lines insurance transacted by such insurer 944 for insurance risks located in this state during such calendar 945 quarter. 946 (2)(4)Each alien insurer accepting premiums shall, on or 947 before June 30 of each year, file with the Florida Surplus Lines 948 Service Office a verified report of all surplus lines insurance 949 transacted by such insurer for insurance risks located in this 950 state during the preceding calendar year. 951 (3)(5)The department may waive the filing requirements 952 described in subsections (1)(3)and (2)(4). 953 (4)(6)Each insurer’s report and supporting information 954 shall be in a computer-readable format as determined by the 955 Florida Surplus Lines Service Office or shall be submitted on 956 forms prescribed by the Florida Surplus Lines Service Office and 957 shall show for each applicable agent: 958 (a) A listing of all policies, certificates, cover notes, 959 or other forms of confirmation of insurance coverage or any 960 substitutions thereof or endorsements thereto and the 961 identifying number; and 962 (b) Any additional information required by the department 963 or Florida Surplus Lines Service Office. 964 Section 22. Paragraph (a) of subsection (2) of section 965 626.932, Florida Statutes, is amended to read: 966 626.932 Surplus lines tax.— 967 (2)(a) The surplus lines agent shall make payable to the 968 department the tax related to each calendar quarter’s business 969 as reported to the Florida Surplus Lines Service Office, and 970 remit the tax to the Florida Surplus Lines Service Office on or 971 before the 45th day following each calendar quarterat the same972time as provided for the filing of the quarterly affidavit,973under s.626.931. The Florida Surplus Lines Service Office shall 974 forward to the department the taxes and any interest collected 975 pursuant to paragraph (b), within 10 days afterofreceipt. 976 Section 23. Subsection (1) of section 626.935, Florida 977 Statutes, is amended to read: 978 626.935 Suspension, revocation, or refusal of surplus lines 979 agent’s license.— 980 (1) The department shall deny an application for, suspend, 981 revoke, or refuse to renew the appointment of a surplus lines 982 agent and all other licenses and appointments held by the 983 licensee under this code, on any of the following grounds: 984 (a) Removal of the licensee’s office from the licensee’s 985 state of residence. 986 (b) Removal of the accounts and records of his or her 987 surplus lines business from this state or the licensee’s state 988 of residence during the period when such accounts and records 989 are required to be maintained under s. 626.930. 990 (c) Closure of the licensee’s office for more than 30 991 consecutive days. 992(d) Failure to make and file his or her affidavit or993reports when due as required by s.626.931.994 (d)(e)Failure to pay the tax or service fee on surplus 995 lines premiums, as provided in the Surplus Lines Law. 996 (e)(f)Suspension, revocation, or refusal to renew or 997 continue the license or appointment as a general lines agent, 998 service representative, or managing general agent. 999 (f)(g)Lack of qualifications as for an original surplus 1000 lines agent’s license. 1001 (g)(h)Violation of this Surplus Lines Law. 1002 (h)(i)For any other applicable cause for which the license 1003 of a general lines agent could be suspended, revoked, or refused 1004 under s. 626.611 or s. 626.621. 1005 Section 24. Subsection (1) of section 626.936, Florida 1006 Statutes, is amended to read: 1007 626.936 Failure to file reports or pay tax or service fee; 1008 administrative penalty.— 1009 (1) AAnylicensed surplus lines agent who neglects to file 1010 a reportor an affidavitin the form and within the time 1011 required or provided for in the Surplus Lines Law may be fined 1012 up to $50 per day for each day the neglect continues, beginning 1013 the day after the reportor affidavitwas due until the date the 1014 reportor affidavitis received. All sums collected under this 1015 section shall be deposited into the Insurance Regulatory Trust 1016 Fund. 1017 Section 25. Paragraph (b) of subsection (2) of section 1018 627.062, Florida Statutes, is amended to read: 1019 627.062 Rate standards.— 1020 (2) As to all such classes of insurance: 1021 (b) Upon receiving a rate filing, the office shall review 1022 the filing to determine if a rate is excessive, inadequate, or 1023 unfairly discriminatory. In making that determination, the 1024 office shall, in accordance with generally accepted and 1025 reasonable actuarial techniques, consider the following factors: 1026 1. Past and prospective loss experience within and without 1027 this state. 1028 2. Past and prospective expenses. 1029 3. The degree of competition among insurers for the risk 1030 insured. 1031 4. Investment income reasonably expected by the insurer, 1032 consistent with the insurer’s investment practices, from 1033 investable premiums anticipated in the filing, plus any other 1034 expected income from currently invested assets representing the 1035 amount expected on unearned premium reserves and loss reserves. 1036 The commission may adopt rules using reasonable techniques of 1037 actuarial science and economics to specify the manner in which 1038 insurers calculate investment income attributable to classes of 1039 insurance written in this state and the manner in which 1040 investment income is used to calculate insurance rates. Such 1041 manner must contemplate allowances for an underwriting profit 1042 factor and full consideration of investment income which produce 1043 a reasonable rate of return; however, investment income from 1044 invested surplus may not be considered. 1045 5. The reasonableness of the judgment reflected in the 1046 filing. 1047 6. Dividends, savings, or unabsorbed premium deposits 1048 allowed or returned to Florida policyholders, members, or 1049 subscribers. 1050 7. The adequacy of loss reserves. 1051 8. The cost of reinsurance. The office may not disapprove a 1052 rate as excessive solely due to the insurer having obtained 1053 catastrophic reinsurance to cover the insurer’s estimated 250 1054 year probable maximum loss or any lower level of loss. 1055 9. Trend factors, including trends in actual losses per 1056 insured unit for the insurer making the filing. 1057 10. Conflagration and catastrophe hazards, if applicable. 1058 11. Projected hurricane losses, if applicable, which must 1059 be estimated using a model or method, or a straight average of 1060 model results or output ranges, independently found to be 1061 acceptable or reliable by the Florida Commission on Hurricane 1062 Loss Projection Methodology, and as further provided in s. 1063 627.0628. 1064 12. A reasonable margin for underwriting profit and 1065 contingencies. 1066 13. The cost of medical services, if applicable. 1067 14. Other relevant factors that affect the frequency or 1068 severity of claims or expenses. 1069 Section 26. Paragraph (d) of subsection (3) of section 1070 627.0628, Florida Statutes, is amended to read: 1071 627.0628 Florida Commission on Hurricane Loss Projection 1072 Methodology; public records exemption; public meetings 1073 exemption.— 1074 (3) ADOPTION AND EFFECT OF STANDARDS AND GUIDELINES.— 1075 (d) With respect to a rate filing under s. 627.062, an 1076 insurer shall employ and may not modify or adjust actuarial 1077 methods, principles, standards, models, or output ranges found 1078 by the commission to be accurate or reliable in determining 1079 hurricane loss factors for use in a rate filing under s. 1080 627.062. An insurer shall employ and may not modify or adjust 1081 models found by the commission to be accurate or reliable in 1082 determining probable maximum loss levels pursuant to paragraph 1083 (b) with respect to a rate filing under s. 627.062 made more 1084 than 18060days after the commission has made such findings. 1085 This paragraph does not prohibit an insurer from using a 1086 straight average of model results or output ranges or using 1087 straight averages for the purposes of a rate filing under s. 1088 627.062. 1089 Section 27. Present subsections (2) through (4) of section 1090 627.072, Florida Statutes, are renumbered as subsections (3) 1091 through (5), respectively, and a new subsection (2) is added to 1092 that section, to read: 1093 627.072 Making and use of rates.— 1094 (2) A retrospective rating plan may contain a provision 1095 that allows negotiation between the employer and the insurer to 1096 determine the retrospective rating factors used to calculate the 1097 premium for employers that have exposure in more than one state 1098 and an estimated annual countrywide standard premium of $1 1099 million or more for workers’ compensation. 1100 Section 28. Subsection (2) of section 627.281, Florida 1101 Statutes, is amended to read: 1102 627.281 Appeal from rating organization; workers’ 1103 compensation and employer’s liability insurance filings.— 1104 (2) If such appeal is based upon the failure of the rating 1105 organization to make a filing on behalf of such member or 1106 subscriber which is based on a system of expense provisions 1107 which differs, in accordance with the right granted in s. 1108 627.072(3)627.072(2), from the system of expense provisions 1109 included in a filing made by the rating organization, the office 1110 shall, if it grants the appeal, order the rating organization to 1111 make the requested filing for use by the appellant. In deciding 1112 such appeal, the office shall apply the applicable standards set 1113 forth in ss. 627.062 and 627.072. 1114 Section 29. Section 627.3519, Florida Statutes, is 1115 repealed. 1116 Section 30. Paragraph (b) of subsection (2) of section 1117 627.4133, Florida Statutes, is amended to read: 1118 627.4133 Notice of cancellation, nonrenewal, or renewal 1119 premium.— 1120 (2) With respect to any personal lines or commercial 1121 residential property insurance policy, including, but not 1122 limited to, any homeowner’s, mobile home owner’s, farmowner’s, 1123 condominium association, condominium unit owner’s, apartment 1124 building, or other policy covering a residential structure or 1125 its contents: 1126 (b) The insurer shall give the first-named insured written 1127 notice of nonrenewal, cancellation, or termination at least 120 1128100days before the effective date of the nonrenewal, 1129 cancellation, or termination.However, the insurer shall give at1130least 100 days’ written notice, or written notice by June 1,1131whichever is earlier, for any nonrenewal, cancellation, or1132termination that would be effective between June 1 and November113330.The notice must include the reason or reasons for the 1134 nonrenewal, cancellation, or termination, except that: 11351. The insurer shall give the first-named insured written1136notice of nonrenewal, cancellation, or termination at least 1201137days prior to the effective date of the nonrenewal,1138cancellation, or termination for a first-named insured whose1139residential structure has been insured by that insurer or an1140affiliated insurer for at least a 5-year period immediately1141prior to the date of the written notice.1142 1.2.If cancellation is for nonpayment of premium, at least 1143 10 days’ written notice of cancellation accompanied by the 1144 reason therefor must be given. As used in this subparagraph, the 1145 term “nonpayment of premium” means failure of the named insured 1146 to discharge when due her or his obligations forin connection1147withthe payment of premiums on a policy or ananyinstallment 1148 of such premium, whether the premium is payable directly to the 1149 insurer or its agent or indirectly under aanypremium finance 1150 plan or extension of credit, or failure to maintain membership 1151 in an organization if such membership is a condition precedent 1152 to insurance coverage. The term also means the failure of a 1153 financial institution to honor an insurance applicant’s check 1154 after delivery to a licensed agent for payment of a premium, 1155 even if the agent has previously delivered or transferred the 1156 premium to the insurer. If a dishonored check represents the 1157 initial premium payment, the contract and all contractual 1158 obligations are void ab initio unless the nonpayment is cured 1159 within the earlier of 5 days after actual notice by certified 1160 mail is received by the applicant or 15 days after notice is 1161 sent to the applicant by certified mail or registered mail., and1162 If the contract is void, any premium received by the insurer 1163 from a third party must be refunded to that party in full. 1164 2.3.Ifsuchcancellation or termination occurs during the 1165 first 90 days the insurance is in force and the insurance is 1166 canceled or terminated for reasons other than nonpayment of 1167 premium, at least 20 days’ written notice of cancellation or 1168 termination accompanied by the reason therefor must be given 1169 unless there has been a material misstatement or 1170 misrepresentation or failure to comply with the underwriting 1171 requirements established by the insurer. 1172 3. After the policy has been in effect for 90 days, the 1173 policy may not be canceled by the insurer unless there has been 1174 a material misstatement, a nonpayment of premium, a failure to 1175 comply with underwriting requirements established by the insurer 1176 within 90 days after the date of effectuation of coverage, a 1177 substantial change in the risk covered by the policy, or the 1178 cancellation is for all insureds under such policies for a given 1179 class of insureds. This subparagraph does not apply to 1180 individually rated risks having a policy term of less than 90 1181 days. 11824. The requirement for providing written notice by June 11183of any nonrenewal that would be effective between June 1 and1184November 30 does not apply to the following situations, but the1185insurer remains subject to the requirement to provide such1186notice at least 100 days before the effective date of1187nonrenewal:1188a. A policy that is nonrenewed due to a revision in the1189coverage for sinkhole losses and catastrophic ground cover1190collapse pursuant to s.627.706.1191 4.b.A policy that is nonrenewed by Citizens Property 1192 Insurance Corporation, pursuant to s. 627.351(6), for a policy 1193 that has been assumed by an authorized insurer offering 1194 replacement coverage to the policyholder is exempt from the 1195 notice requirements of paragraph (a) and this paragraph. In such 1196 cases, the corporation must give the named insured written 1197 notice of nonrenewal at least 45 days before the effective date 1198 of the nonrenewal. 1199 1200After the policy has been in effect for 90 days, the policy may1201not be canceled by the insurer unless there has been a material1202misstatement, a nonpayment of premium, a failure to comply with1203underwriting requirements established by the insurer within 901204days after the date of effectuation of coverage, or a1205substantial change in the risk covered by the policy or if the1206cancellation is for all insureds under such policies for a given1207class of insureds. This paragraph does not apply to individually1208rated risks having a policy term of less than 90 days.1209 5. Notwithstanding any other provision of law, an insurer 1210 may cancel or nonrenew a property insurance policy after at 1211 least 45 days’ notice if the office finds that the early 1212 cancellation of some or all of the insurer’s policies is 1213 necessary to protect the best interests of the public or 1214 policyholders and the office approves the insurer’s plan for 1215 early cancellation or nonrenewal of some or all of its policies. 1216 The office may base such finding upon the financial condition of 1217 the insurer, lack of adequate reinsurance coverage for hurricane 1218 risk, or other relevant factors. The office may condition its 1219 finding on the consent of the insurer to be placed under 1220 administrative supervision pursuant to s. 624.81 or to the 1221 appointment of a receiver under chapter 631. 1222 6. A policy covering both a home and motor vehicle may be 1223 nonrenewed for any reason applicable toeitherthe property or 1224 motor vehicle insurance after providing 90 days’ notice. 1225 Section 31. Subsection (1) of section 627.4137, Florida 1226 Statutes, is amended to read: 1227 627.4137 Disclosure of certain information required.— 1228 (1) Each insurer that provideswhich doesor may provide 1229 liability insurance coverage to pay all or a portion of aany1230 claim thatwhichmight be made shall provide, within 30 days 1231 afterofthe written request of the claimant, a statement, under 1232 oath, of a corporate officer or the insurer’s claims manager,or1233 superintendent, or licensed company adjuster setting forth the 1234 following information with regard to each known policy of 1235 insurance, including excess or umbrella insurance: 1236 (a) The name of the insurer. 1237 (b) The name of each insured. 1238 (c) The limits of the liability coverage. 1239 (d) A statement of any policy or coverage defense that the 1240which suchinsurer reasonably believes is available to thesuch1241 insurer at the time of filing such statement. 1242 (e) A copy of the policy. 1243 1244 In addition, the insured, or her or his insurance agent, upon 1245 written request of the claimant or the claimant’s attorney, 1246 shall disclose the name and coverage of each known insurer to 1247 the claimant and shall forward such request for information as 1248 required by this subsection to all affected insurers. The 1249 insurer shall then supply the information required in this 1250 subsection to the claimant within 30 days afterofreceipt of 1251 such request. 1252 Section 32. Subsection (1) of section 627.421, Florida 1253 Statutes, is amended to read: 1254 627.421 Delivery of policy.— 1255 (1) Subject to the insurer’s requirement as to payment of 1256 premium, every policy shall be mailed or delivered to the 1257 insured or to the person entitled thereto not later than 60 days 1258 after the effectuation of coverage. Notwithstanding any other 1259 provision of law, an insurer may allow a policyholder of 1260 personal lines insurance to affirmatively elect delivery of the 1261 policy documents, including, but not limited to, policies, 1262 endorsements, notices, or documents, by electronic means in lieu 1263 of delivery by mail. 1264 Section 33. Subsection (2) of section 627.43141, Florida 1265 Statutes, is amended to read: 1266 627.43141 Notice of change in policy terms.— 1267 (2) A renewal policy may contain a change in policy terms. 1268 If a renewal policy containsdoes containsuch change, the 1269 insurer must give the named insured written notice of the 1270 change, which may eithermustbe enclosed along with the written 1271 notice of renewal premium required by ss. 627.4133 and 627.728 1272 or sent in a separate notice that complies with the nonrenewal 1273 mailing time requirement for that particular line of business. 1274 The insurer must also provide a sample copy of the notice to the 1275 insured’s insurance agent before or at the same time that notice 1276 is given to the insured. Such notice shall be entitled “Notice 1277 of Change in Policy Terms.” 1278 Section 34. Section 627.6484, Florida Statutes, is amended 1279 to read: 1280 627.6484 Dissolution of association; termination of 1281 enrollment; availability of other coverage.— 1282 (1) The association shall accept applications for insurance 1283 only until June 30, 1991, after which date no further 1284 applications may be accepted.Upon receipt of an application for1285insurance, the association shall issue coverage for an eligible1286applicant. When appropriate, the administrator shall forward a1287copy of the application to a market assistance plan created by1288the office, which shall conduct a diligent search of the private1289marketplace for a carrier willing to accept the application.1290 (2) Coverage for each policyholder of the association 1291 terminates at midnight, June 30, 2014, or on the date that 1292 health insurance coverage is effective with another insurer, 1293 whichever occurs first, and such coverage may not be renewed. 1294 (3) The association shall provide assistance to each 1295 policyholder concerning how to obtain health insurance coverage. 1296 Such assistance must include: 1297 (a) The identification of insurers and health maintenance 1298 organizations offering coverage in the individual market, 1299 including coverage inside and outside of the Health Insurance 1300 Exchange; 1301 (b) A basic explanation of the levels of coverage 1302 available; and 1303 (c) Specific information relating to local and online 1304 sources from which a policyholder may obtain detailed policy and 1305 premium comparisons and directly obtain coverage. 1306 (4) The association shall provide written notice to all 1307 policyholders by September 1, 2013, which informs each 1308 policyholder with respect to: 1309 (a) The date that coverage with the association is 1310 terminated and that such coverage may not be renewed. 1311 (b) The opportunity for the policyholder to obtain 1312 individual health insurance coverage on a guaranteed-issue 1313 basis, regardless of policyholder’s health status, from a health 1314 insurer or health maintenance organization that offers coverage 1315 in the individual market, including the dates of open enrollment 1316 periods for obtaining such coverage. 1317 (c) How to access coverage through the Health Insurance 1318 Exchange established for this state pursuant to the Patient 1319 Protection and Affordable Care Act and the potential for 1320 obtaining reduced premiums and cost-sharing provisions depending 1321 on the policyholder’s family income level. 1322 (d) Contact information for a representative of the 1323 association who is able to provide additional information about 1324 obtaining individual health insurance coverage both inside and 1325 outside of the Health Insurance Exchange. 1326 (5) After termination of coverage, the association must 1327 continue to receive and process timely submitted claims in 1328 accordance with the laws of this state. 1329 (6) By March 15, 2015, the association shall determine the 1330 final assessment to be collected from insurers for funding 1331 claims and administrative expenses of the association or, if 1332 surplus funds remain, shall determine the refund amount to be 1333 provided to each insurer based on the same pro rata formula used 1334 for determining each insurer’s assessment. 1335 (7) By September 1, 2015, the board must: 1336 (a) Complete performance of all program responsibilities. 1337 (b) Sell or otherwise dispose of all physical assets of the 1338 association. 1339 (c) Make a final accounting of the finances of the 1340 association. 1341 (d) Transfer all records to the Office of Insurance 1342 Regulation, which shall serve as custodian of such records. 1343 (e) Execute a legal dissolution of the association and 1344 report such action to the Chief Financial Officer, the Insurance 1345 Commissioner, the President of the Senate, and the Speaker of 1346 the House of Representatives. 1347(2) The office shall, after consultation with the health1348insurers licensed in this state, adopt a market assistance plan1349to assist in the placement of risks of Florida Comprehensive1350Health Association applicants. All health insurers and health1351maintenance organizations licensed in this state shall1352participate in the plan.1353(3) Guidelines for the use of such program shall be a part1354of the association’s plan of operation. The guidelines shall1355describe which types of applications are to be exempt from1356submission to the market assistance plan. An exemption shall be1357based upon a determination that due to a specific health1358condition an applicant is ineligible for coverage in the1359standard market. The guidelines shall also describe how the1360market assistance plan is to be conducted, and how the periodic1361reviews to depopulate the association are to be conducted.1362(4) If a carrier is found through the market assistance1363plan, the individual shall apply to that company. If the1364individual’s application is accepted, association coverage shall1365terminate upon the effective date of the coverage with the1366private carrier. For the purpose of applying a preexisting1367condition limitation or exclusion, any carrier accepting a risk1368pursuant to this section shall provide coverage as if it began1369on the date coverage was effectuated on behalf of the1370association, and shall be indemnified by the association for1371claims costs incurred as a result of utilizing such effective1372date.1373(5) The association shall establish a policyholder1374assistance program by July 1, 1991, to assist in placing1375eligible policyholders in other coverage programs, including1376Medicare and Medicaid.1377 Section 35. Section 627.64872, Florida Statutes, is 1378 repealed. 1379 Section 36. Effective October 1, 2015, sections 627.648, 1380 627.6482, 627.6484, 627.6486, 627.6488, 627.6489, 627.649, 1381 627.6492, 627.6494, 627.6496, 627.6498, and 627.6499, Florida 1382 Statutes, are repealed. 1383 Section 37. Subsection (7) of section 627.701, Florida 1384 Statutes, is amended to read: 1385 627.701 Liability of insureds; coinsurance; deductibles.— 1386 (7) BeforePrior toissuing a personal lines residential 1387 property insurance policy on or after January 1, 2014April 1,13881997, or beforeprior tothe first renewal of a residential 1389 property insurance policy on or after January 1, 2014April 1,13901997, the insurer must, at a minimum, offer a deductible equal 1391 to $750 and a deductible equal to 1 percent of the policy 1392 dwelling limits if such amount is not less than $750,$5001393 applicable to losses from perils other than hurricane. Beginning 1394 July 1, 2018, and every 5 years thereafter, the office shall 1395 calculate and publish an adjustment to the $750 deductible based 1396 on the average percentage change in the Consumer Price Index for 1397 All Urban Consumers, U.S. City Average, all items, compiled by 1398 the United States Department of Labor for the immediately 1399 preceding 5 calendar years. The adjustment to the $750 1400 deductible shall be rounded to the nearest $50 increment and 1401 take effect on the January 1 following the publication of the 1402 adjustment by the office. The first initial adjusted deductible 1403 shall take effect upon the renewal or issuance of policies on or 1404 after January 1, 2019The insurer must provide the policyholder1405with notice of the availability of the deductible specified in1406this subsection in a form approved by the office at least once1407every 3 years.The failure to provide such notice constitutes a1408violation of this code but does not affect the coverage provided1409under the policy.An insurer may require a higher deductible 1410 only as part of a deductible program lawfully in effect on June 1411 1, 1996, or as part of a similar deductible program. 1412 Section 38. Paragraph (b) of subsection (4) of section 1413 627.7015, Florida Statutes, is amended to read: 1414 627.7015 Alternative procedure for resolution of disputed 1415 property insurance claims.— 1416 (4) The department shall adopt by rule a property insurance 1417 mediation program to be administered by the department or its 1418 designee. The department may also adopt special rules which are 1419 applicable in cases of an emergency within the state. The rules 1420 shall be modeled after practices and procedures set forth in 1421 mediation rules of procedure adopted by the Supreme Court. The 1422 rules shall provide for: 1423 (b) Qualifications, denial of application, suspension, 1424 revocation, and other penalties forofmediators as provided in 1425 s. 627.745 and in the Florida Rules of Certified and Court 1426 Appointed Mediators, and for such other individuals as are1427qualified by education, training, or experience as the1428department determines to be appropriate. 1429 Section 39. Section 627.70151, Florida Statutes, is created 1430 to read: 1431 627.70151 Appraisal; conflicts of interest.—An insurer that 1432 offers residential coverage, as defined in s. 627.4025, or a 1433 policyholder that uses an appraisal clause in the property 1434 insurance contract to establish a process of estimating or 1435 evaluating the amount of the loss through the use of an 1436 impartial umpire may challenge the umpire’s impartiality and 1437 disqualify the proposed umpire only if: 1438 (1) A familial relationship within the third degree exists 1439 between the umpire and any party or a representative of any 1440 party; 1441 (2) The umpire has previously represented any party or a 1442 representative of any party in a professional capacity in the 1443 same or a substantially related matter; 1444 (3) The umpire has represented another person in a 1445 professional capacity on the same or a substantially related 1446 matter, which includes the claim, same property, or an adjacent 1447 property and that other person’s interests are materially 1448 adverse to the interests of any party; or 1449 (4) The umpire has worked as an employer or employee of any 1450 party within the preceding 5 years. 1451 Section 40. Paragraph (c) of subsection (2) of section 1452 627.706, Florida Statutes, is amended to read: 1453 627.706 Sinkhole insurance; catastrophic ground cover 1454 collapse; definitions.— 1455 (2) As used in ss. 627.706-627.7074, and as used in 1456 connection with any policy providing coverage for a catastrophic 1457 ground cover collapse or for sinkhole losses, the term: 1458 (c) “Neutral evaluator” means a professional engineer or a 1459 professional geologist who has completed a course of study in 1460 alternative dispute resolution designed or approved by the 1461 department for use in the neutral evaluation process,andwho is 1462 determined by the department to be fair and impartial, and who 1463 is not otherwise ineligible for certification as provided in s. 1464 627.7074. 1465 Section 41. Subsection (1) of section 627.7074, Florida 1466 Statutes, is amended to read: 1467 627.7074 Alternative procedure for resolution of disputed 1468 sinkhole insurance claims.— 1469 (1) The department shall: 1470 (a) Certify and maintain a list of persons who are neutral 1471 evaluators. 1472 (b) Adopt rules for certifying, denying certification, 1473 suspending certification, and revoking certification as a 1474 neutral evaluator, in keeping with qualifications specified in 1475 this section and ss. 627.706 and 627.745(4). 1476 (c)(b)Prepare a consumer information pamphlet for 1477 distribution by insurers to policyholders which clearly 1478 describes the neutral evaluation process and includes 1479 information necessary for the policyholder to request a neutral 1480 evaluation. 1481 Section 42. Paragraph (a) of subsection (5) of section 1482 627.736, Florida Statutes, is amended to read: 1483 627.736 Required personal injury protection benefits; 1484 exclusions; priority; claims.— 1485 (5) CHARGES FOR TREATMENT OF INJURED PERSONS.— 1486 (a) A physician, hospital, clinic, or other person or 1487 institution lawfully rendering treatment to an injured person 1488 for a bodily injury covered by personal injury protection 1489 insurance may charge the insurer and injured party only a 1490 reasonable amount pursuant to this section for the services and 1491 supplies rendered, and the insurer providing such coverage may 1492 pay for such charges directly to such person or institution 1493 lawfully rendering such treatment if the insured receiving such 1494 treatment or his or her guardian has countersigned the properly 1495 completed invoice, bill, or claim form approved by the office 1496 upon which such charges are to be paid for as having actually 1497 been rendered, to the best knowledge of the insured or his or 1498 her guardian. However, such a charge may not exceed the amount 1499 the person or institution customarily charges for like services 1500 or supplies. In determining whether a charge for a particular 1501 service, treatment, or otherwise is reasonable, consideration 1502 may be given to evidence of usual and customary charges and 1503 payments accepted by the provider involved in the dispute, 1504 reimbursement levels in the community and various federal and 1505 state medical fee schedules applicable to motor vehicle and 1506 other insurance coverages, and other information relevant to the 1507 reasonableness of the reimbursement for the service, treatment, 1508 or supply. 1509 1. The insurer may limit reimbursement to 80 percent of the 1510 following schedule of maximum charges: 1511 a. For emergency transport and treatment by providers 1512 licensed under chapter 401, 200 percent of Medicare. 1513 b. For emergency services and care provided by a hospital 1514 licensed under chapter 395, 75 percent of the hospital’s usual 1515 and customary charges. 1516 c. For emergency services and care as defined by s. 395.002 1517 provided in a facility licensed under chapter 395 rendered by a 1518 physician or dentist, and related hospital inpatient services 1519 rendered by a physician or dentist, the usual and customary 1520 charges in the community. 1521 d. For hospital inpatient services, other than emergency 1522 services and care, 200 percent of the Medicare Part A 1523 prospective payment applicable to the specific hospital 1524 providing the inpatient services. 1525 e. For hospital outpatient services, other than emergency 1526 services and care, 200 percent of the Medicare Part A Ambulatory 1527 Payment Classification for the specific hospital providing the 1528 outpatient services. 1529 f. For all other medical services, supplies, and care, 200 1530 percent of the allowable amount under: 1531 (I) The participating physicians fee schedule of Medicare 1532 Part B, except as provided in sub-sub-subparagraphs (II) and 1533 (III). 1534 (II) Medicare Part B, in the case of services, supplies, 1535 and care provided by ambulatory surgical centers and clinical 1536 laboratories. 1537 (III) The Durable Medical Equipment Prosthetics/Orthotics 1538 and Supplies fee schedule of Medicare Part B, in the case of 1539 durable medical equipment. 1540 1541 However, if such services, supplies, or care is not reimbursable 1542 under Medicare Part B, as provided in this sub-subparagraph, the 1543 insurer may limit reimbursement to 80 percent of the maximum 1544 reimbursable allowance under workers’ compensation, as 1545 determined under s. 440.13 and rules adopted thereunder which 1546 are in effect at the time such services, supplies, or care is 1547 provided. Services, supplies, or care that is not reimbursable 1548 under Medicare or workers’ compensation is not required to be 1549 reimbursed by the insurer. 1550 2. For purposes of subparagraph 1., the applicable fee 1551 schedule or payment limitation under Medicare is the fee 1552 schedule or payment limitation in effect on March 1 of the year 1553 in which the services, supplies, or care is rendered and for the 1554 area in which such services, supplies, or care is rendered, and 1555 the applicable fee schedule or payment limitation applies from 1556 March 1 until the last day of the following Februarythroughout1557the remainder of that year, notwithstanding any subsequent 1558 change made to the fee schedule or payment limitation, except 1559 that it may not be less than the allowable amount under the 1560 applicable schedule of Medicare Part B for 2007 for medical 1561 services, supplies, and care subject to Medicare Part B. 1562 3. Subparagraph 1. does not allow the insurer to apply any 1563 limitation on the number of treatments or other utilization 1564 limits that apply under Medicare or workers’ compensation. An 1565 insurer that applies the allowable payment limitations of 1566 subparagraph 1. must reimburse a provider who lawfully provided 1567 care or treatment under the scope of his or her license, 1568 regardless of whether such provider is entitled to reimbursement 1569 under Medicare due to restrictions or limitations on the types 1570 or discipline of health care providers who may be reimbursed for 1571 particular procedures or procedure codes. However, subparagraph 1572 1. does not prohibit an insurer from using the Medicare coding 1573 policies and payment methodologies of the federal Centers for 1574 Medicare and Medicaid Services, including applicable modifiers, 1575 to determine the appropriate amount of reimbursement for medical 1576 services, supplies, or care if the coding policy or payment 1577 methodology does not constitute a utilization limit. 1578 4. If an insurer limits payment as authorized by 1579 subparagraph 1., the person providing such services, supplies, 1580 or care may not bill or attempt to collect from the insured any 1581 amount in excess of such limits, except for amounts that are not 1582 covered by the insured’s personal injury protection coverage due 1583 to the coinsurance amount or maximum policy limits. 1584 5. Effective July 1, 2012, an insurer may limit payment as 1585 authorized by this paragraph only if the insurance policy 1586 includes a notice at the time of issuance or renewal that the 1587 insurer may limit payment pursuant to the schedule of charges 1588 specified in this paragraph. A policy form approved by the 1589 office satisfies this requirement. If a provider submits a 1590 charge for an amount less than the amount allowed under 1591 subparagraph 1., the insurer may pay the amount of the charge 1592 submitted. 1593 Section 43. Subsection (3) of section 627.745, Florida 1594 Statutes, is amended, present subsections (4) and (5) of that 1595 section are renumbered as subsections (5) and (6), respectively, 1596 and a new subsection (4) is added to that section, to read: 1597 627.745 Mediation of claims.— 1598 (3)(a) The department shall approve mediators to conduct 1599 mediations pursuant to this section. All mediators must file an 1600 application under oath for approval as a mediator. 1601 (b) To qualify for approval as a mediator, an individuala1602personmust meet one of the following qualifications: 1603 1. Possess an active certification as a Florida Circuit 1604 Court Mediator. A Florida Circuit Court Mediator in a lapsed, 1605 suspended, or decertified status is not eligible to participate 1606 in the mediation programa masters or doctorate degree in1607psychology, counseling, business, accounting, or economics, be a1608member of The Florida Bar, be licensed as a certified public1609accountant, or demonstrate that the applicant for approval has1610been actively engaged as a qualified mediator for at least 41611years prior to July 1, 1990. 1612 2. Be an approved department mediator as of July 1, 2013, 1613 and have conducted at least one mediation on behalf of the 1614 department within 4 years immediately preceding thatthedate 1615the application for approval is filed with the department, have1616completed a minimum of a 40-hour training program approved by1617the department and successfully passed a final examination1618included in the training program and approved by the department. 1619The training program shall include and address all of the1620following:1621a. Mediation theory.1622b. Mediation process and techniques.1623c. Standards of conduct for mediators.1624d. Conflict management and intervention skills.1625e. Insurance nomenclature.1626 (4) The department shall deny an application, or suspend or 1627 revoke its approval of a mediator or its certification of a 1628 neutral evaluator to serve in such capacity, if it finds that 1629 any of the following grounds exist: 1630 (a) Lack of one or more of the qualifications specified in 1631 this section for approval or certification. 1632 (b) Material misstatement, misrepresentation, or fraud in 1633 obtaining or attempting to obtain the approval or certification. 1634 (c) Demonstrated lack of fitness or trustworthiness to act 1635 as a mediator or neutral evaluator. 1636 (d) Fraudulent or dishonest practices in the conduct of 1637 mediation or neutral evaluation or in the conduct of business in 1638 the financial services industry. 1639 (e) Violation of any provision of this code, a lawful order 1640 or rule of the department, the Florida Rules for Certified and 1641 Court-Appointed Mediators, or aiding, instructing, or 1642 encouraging another party in committing such a violation. 1643 1644 The department may adopt rules to administer this subsection. 1645 Section 44. Subsection (4) of section 627.841, Florida 1646 Statutes, is amended to read: 1647 627.841 Delinquency, collection, cancellation, and payment 1648checkreturn chargecharges; attorneyattorney’sfees.— 1649 (4) In the event that a payment is made to a premium 1650 finance company by debit, credit, electronic funds transfer, 1651 check, or draft and such paymentthe instrumentis returned, 1652 declined, or cannot be processed due tobecause ofinsufficient 1653 fundsto pay it, the premium finance company may, if the premium 1654 finance agreement so provides, impose a return payment charge of 1655 $15. 1656 Section 45. Paragraph (b) of subsection (1) of section 1657 627.952, Florida Statutes, is amended to read: 1658 627.952 Risk retention and purchasing group agents.— 1659 (1) Any person offering, soliciting, selling, purchasing, 1660 administering, or otherwise servicing insurance contracts, 1661 certificates, or agreements for any purchasing group or risk 1662 retention group to aanyresident of this state, either directly 1663 or indirectly, by the use of mail, advertising, or other means 1664 of communication, shall obtain a license and appointment to act 1665 as a resident general lines agent, if a resident of this state, 1666 or a nonresident general lines agent if not a resident. Any such 1667 person shall be subject to all requirements of the Florida 1668 Insurance Code. 1669 (b) AAnyperson required to be licensed and appointed 1670 under this subsection, in order to place business through 1671 Florida eligible surplus lines carriers, must, if a resident of 1672 this state, be licensed and appointed as a surplus lines agent. 1673 If not a resident of this state, such person must be licensed 1674 and appointed as a nonresident surplus lines agent in thisher1675or hisstateof residence and file and maintain a fidelity bond1676in favor of the people of the State of Florida executed by a1677surety company admitted in this state and payable to the State1678of Florida; however, such nonresident is limited to the1679provision of insurance for purchasing groups.The bond must be1680continuous in form and in the amount of not less than $50,000,1681aggregate liability. The bond must remain in force and effect1682until the surety is released from liability by the department or1683until the bond is canceled by the surety. The surety may cancel1684the bond and be released from further liability upon 30 days’1685prior written notice to the department. The cancellation does1686not affect any liability incurred or accrued before the1687termination of the 30-day period. Upon receipt of a notice of1688cancellation, the department shall immediately notify the agent.1689 Section 46. Subsection (6) of section 627.971, Florida 1690 Statutes, is amended to read: 1691 627.971 Definitions.—As used in this part: 1692 (6) “Financial guaranty insurance corporation” means a 1693 stock or mutual insurer licensed to transact financial guaranty 1694 insurance business in this state. 1695 Section 47. Subsection (1) of section 627.972, Florida 1696 Statutes, is amended to read: 1697 627.972 Organization; financial requirements.— 1698 (1) A financial guaranty insurance corporation must be 1699 organized and licensed in the manner prescribed in this code for 1700 stock or mutual property and casualty insurers except that: 1701 (a) A corporation organized to transact financial guaranty 1702 insurance may, subject to the provisions of this code, be 1703 licensed to transact: 1704 1. Residual value insurance, as defined by s. 624.6081; 1705 2. Surety insurance, as defined by s. 624.606; 1706 3. Credit insurance, as defined by s. 624.605(1)(i); and 1707 4. Mortgage guaranty insurance as defined in s. 635.011, 1708 provided that the provisions of chapter 635 are met. 1709 (b)1. BeforePrior tothe issuance of a license, a 1710 corporation must submit to the office for approval,a plan of 1711 operation detailing: 1712 a. The types and projected diversification of guaranties to 1713 be issued; 1714 b. The underwriting procedures to be followed; 1715 c. The managerial oversight methods; 1716 d. The investment policies; and 1717 e.AnyOther matters prescribed by the office; 1718 2. An insurer which is writing only the types of insurance 1719 allowed under this part on July 1, 1988, and otherwise meets the 1720 requirements of this part, is exempt from the requirements of 1721 this paragraph. 1722 (c) An insurer transacting financial guaranty insurance is 1723 subject to all provisions of this code that are applicable to 1724 property and casualty insurers to the extent that those 1725 provisions are not inconsistent with this part. 1726 (d) The investments of an insurer transacting financial 1727 guaranty insurance in ananyentity insured by the corporation 1728 may not exceed 2 percent of its admitted assets as of the end of 1729 the prior calendar year. 1730 (e) An insurer transacting financial guaranty insurance may 1731 only assume those lines of insurance for which it is licensed to 1732 write direct business. 1733 Section 48. Subsections (8), (9), and (13) of section 1734 628.901, Florida Statutes, are amended to read: 1735 628.901 Definitions.—As used in this part, the term: 1736 (8) “Industrial insured” means an insured that: 1737 (a) Has gross assets in excess of $50 million; 1738 (b) Procures insurance through the use of a full-time 1739 employee of the insured who acts as an insurance manager or 1740 buyer or through the services of a person licensed as a property 1741 and casualty insurance agent, broker, or consultant in such 1742 person’s state of domicile; 1743 (c) Has at least 100 full-time employees; and 1744 (d) Pays annual premiums of at least $200,000 for each line 1745 of insurance purchased from the industrial insured captive 1746 insurance companyinsureror at least $75,000 for any line of 1747 coverage in excess of at least $25 million in the annual 1748 aggregate. The purchase of umbrella or general liability 1749 coverage in excess of $25 million in the annual aggregate shall 1750 be deemed to be the purchase of a single line of insurance. 1751 (9) “Industrial insured captive insurance company” means a 1752captive insurancecompany that provides insurance only to the 1753 industrial insureds that are its stockholders or members, and 1754 affiliates thereof, or to the stockholders, and affiliates 1755 thereof, of its parent corporation. An industrial insured 1756 captive insurance company can also provide reinsurance to 1757 insurers only on risks written by such insurers for the 1758 industrial insureds that are the stockholders or members, and 1759 affiliates thereof, of the industrial insured captive insurance 1760 companyinsurer, or the stockholders, and affiliates thereof, of 1761 the parent corporation of the industrial insured captive 1762 insurance companyinsurer. 1763 (13) “Qualifying reinsurer parent company” means a 1764 reinsurer thatwhichcurrently holds a certificate of authority,1765letter of eligibilityor is an accredited or trusteed under s. 1766 624.610(3)(c)a satisfactory non-approvedreinsurer in this 1767 state possessing a consolidated GAAP net worth of at least $500 1768 million and a consolidated debt to total capital ratio of not 1769 greater than 0.50. 1770 Section 49. Subsections (1), (2), (4), and (5) of section 1771 628.905, Florida Statutes, are amended to read: 1772 628.905 Licensing; authority.— 1773 (1) A captive insurance companyinsurer, if permitted by 1774 its charter or articles of incorporation, may apply to the 1775 office for a license to do any and all insurance authorized 1776 under the insurance code, other than workers’ compensation and 1777 employer’s liability, life, health, personal motor vehicle, and 1778 personal residential property insurance, except that: 1779 (a) A pure captive insurance company may not insureany1780 risks other than those of its parent, affiliated companies, 1781 controlled unaffiliated businesses, or a combination thereof. 1782 (b) An industrial insured captive insurance company may not 1783 insureanyrisks other than those of the industrial insureds 1784 that comprise the industrial insured group and their affiliated 1785 companies, or its stockholders or members, and affiliates 1786 thereof, of the industrial insured captive, or the stockholders 1787 or affiliates of the parent corporation of the industrial 1788 insured captive insurance company. 1789 (c) A special purpose captive insurance company may insure 1790 only the risks of its parent. 1791 (d) A captive insurance company may not accept or cede 1792 reinsurance except as provided in this part. 1793 (e) An industrial insured captive insurance company with 1794 unencumbered capital and surplus of at least $20 million may be 1795 licensed to provide workers’ compensation and employer’s 1796 liability insurance in excess of $25 million in the annual 1797 aggregate. An industrial insured captive insurance company must 1798 maintain unencumbered capital and surplus of at least $20 1799 million to continue to write excess workers’ compensation 1800 insurance. 1801 (2) To conduct insurance business in this state, a captive 1802 insurance companyinsurermust: 1803 (a) Obtain from the office a license authorizing it to 1804 conduct insurance business in this state; 1805 (b) Hold at least one board of directors’ meeting each year 1806 in this state; 1807 (c) Maintain its principal place of business in this state; 1808 and 1809 (d) Appoint a resident registered agent to accept service 1810 of process and to otherwise act on its behalf in this state. In 1811 the case of a captive insurance company formed as a corporation 1812 or a nonprofit corporation, if the registered agent cannot with 1813 reasonable diligence be found at the registered office of the 1814 captive insurance company, the Chief Financial Officer of this 1815 state must be an agent of the captive insurance company upon 1816 whomanyprocess, notice, or demand may be served. 1817 (4) A captive insurance company or captive reinsurance 1818 company must pay to the office a nonrefundable fee of $1,500 for 1819 processing its application for license. 1820 (a) A captive insurance company or captive reinsurance 1821 company must also pay an annual renewal fee of $1,000. 1822 (b) The office may charge a fee of $5 for aanydocument 1823 requiring certification of authenticity or the signature of the 1824 officecommissioner or his or her designee. 1825 (5) If the officecommissioneris satisfied that the 1826 documents and statements filed by the captive insurance company 1827 comply with this chapter, the officecommissionermay grant a 1828 license authorizing the company to conduct insurance business in 1829 this state until the next succeeding March 1, at which time the 1830 license may be renewed. 1831 Section 50. Subsection (1) of section 628.907, Florida 1832 Statutes, is amended to read: 1833 628.907 Minimum capital and net assets requirements; 1834 restriction on payment of dividends.— 1835 (1) A captive insurance companyinsurermay not be issued a 1836 license unless it possesses and thereafter maintains unimpaired 1837 paid-in capital of: 1838 (a) In the case of a pure captive insurance company, at 1839 least $100,000. 1840 (b) In the case of an industrial insured captive insurance 1841 company incorporated as a stock insurer, at least $200,000. 1842 (c) In the case of a special purpose captive insurance 1843 company, an amount determined by the office after giving due 1844 consideration to the company’s business plan, feasibility study, 1845 and pro forma financial statements and projections, including 1846 the nature of the risks to be insured. 1847 Section 51. Section 628.909, Florida Statutes, is amended 1848 to read: 1849 628.909 Applicability of other laws.— 1850 (1) The Florida Insurance Code does not apply to captive 1851 insurance companiesinsurersor industrial insured captive 1852 insurance companiesinsurersexcept as provided in this part and 1853 subsections (2) and (3). 1854 (2) The following provisions of the Florida Insurance Code 1855 apply to captive insurance companiesinsurerswho are not 1856 industrial insured captive insurance companiesinsurersto the 1857 extent that such provisions are not inconsistent with this part: 1858 (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085, 1859 624.40851, 624.4095, 624.411, 624.425, and 624.426. 1860 (b) Chapter 625, part II. 1861 (c) Chapter 626, part IX. 1862 (d) Sections 627.730-627.7405, when no-fault coverage is 1863 provided. 1864 (e) Chapter 628. 1865 (3) The following provisions of the Florida Insurance Code 1866 apply to industrial insured captive insurance companiesinsurers1867 to the extent that such provisions are not inconsistent with 1868 this part: 1869 (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085, 1870 624.40851, 624.4095, 624.411, 624.425, 624.426, and 624.609(1). 1871 (b) Chapter 625, part II, if the industrial insured captive 1872 insurance companiesinsureris incorporated in this state. 1873 (c) Chapter 626, part IX. 1874 (d) Sections 627.730-627.7405 when no-fault coverage is 1875 provided. 1876 (e) Chapter 628, except for ss. 628.341, 628.351, and 1877 628.6018. 1878 Section 52. Subsection (2) of section 628.9142, Florida 1879 Statutes, is amended to read: 1880 628.9142 Reinsurance; effect on reserves.— 1881 (2) A captive insurance company may take credit for 1882 reserves on risks or portions of risks ceded to authorized 1883 insurers or reinsurers and unauthorized insurers or reinsurers 1884 complying with s. 624.610. A captive insurance companyinsurer1885 may not take credit for reserves on risks or portions of risks 1886 ceded to an unauthorized insurer or reinsurer if the insurer or 1887 reinsurer is not in compliance with s. 624.610. 1888 Section 53. Section 628.915, Florida Statutes, is amended 1889 to read: 1890 628.915 Exemption from compulsory association.— 1891 (1) ANocaptive insurance company may notinsurershall be1892permitted tojoin or contribute financially to aanyjoint 1893 underwriting association or guaranty fund in this state, and a;1894nor shall anycaptive insurance companyinsurer, its insured, or 1895 its parent or any affiliated company may not receive any benefit 1896 from any such joint underwriting association or guaranty fund 1897 for claims arising out of the operations of such captive 1898 insurer. 1899 (2) AnNoindustrial insured captive insurance company may 1900 notinsurershall be permitted tojoin or contribute financially 1901 to any joint underwriting association or guaranty fund in this 1902 state; nor shall any industrial insured captive insurance 1903 companyinsurer, its industrial insured, or its parent or any 1904 affiliated company receive any benefit from any such joint 1905 underwriting association or guaranty fund for claims arising out 1906 of the operations of such industrial insured captive insurance 1907 companyinsurer. 1908 Section 54. Section 628.917, Florida Statutes, is amended 1909 to read: 1910 628.917 Insolvency and liquidation.—In the event that a 1911 captive insurance companyinsureris insolvent as defined in 1912 chapter 631, the office shall liquidate the captive insurance 1913 companyinsurerpursuant to the provisions of part I of chapter 1914 631.; except thatThe office may notshall make noattempt to 1915 rehabilitate such insurer. 1916 Section 55. Section 628.919, Florida Statutes, is amended 1917 to read: 1918 628.919 Standards to ensure risk management control by 1919 parent company.—A pure captive insurance company shall submit to 1920 the office for approvalThe Financial Services Commission shall1921adopt rules establishingstandards to ensure that a parent or 1922 affiliated company is able to exercise control of the risk 1923 management function of any controlled unaffiliated business to 1924 be insured by the pure captive insurance company. 1925 Section 56. Subsection (8) of section 634.406, Florida 1926 Statutes, is renumbered as subsection (7), and present 1927 subsections (6) and (7) of that section are amended, to read: 1928 634.406 Financial requirements.— 1929 (6) An association thatwhichholds a license under this 1930 partand which does not hold any other license under this1931chaptermay allow its premiums for service warranties written 1932 under this part to exceed the ratio to net assets limitations of 1933 this section if the association meets all of the following: 1934 (a) Maintains net assets of at least $750,000. 1935 (b) Utilizes a contractual liability insurance policy 1936 approved by the office which: 1937 1. Reimburses the service warranty association for 100 1938 percent of its claims liability and is issued by an insurer that 1939 maintains a policyholder surplus of at least $100 million; or 1940 2. Complies with the requirements of subsection (3) and is 1941 issued by an insurer that maintains a policyholder surplus of at 1942 least $200 million. 1943 (c) The insurer issuing the contractual liability insurance 1944 policy: 19451. Maintains a policyholder surplus of at least $1001946million.1947 1.2.Is rated “A” or higher by A.M. Best Company or an 1948 equivalent rating by another national rating service acceptable 1949 to the office. 19503. Is in no way affiliated with the warranty association.1951 2.4.In conjunction with the warranty association’s filing 1952 of the quarterly and annual reports, provides, on a form 1953 prescribed by the commission, a statement certifying the gross 1954 written premiums in force reported by the warranty association 1955 and a statement that all of the warranty association’s gross 1956 written premium in force is covered under the contractual 1957 liability policy, whether or not it has been reported. 1958(7) A contractual liability policy must insure 100 percent1959of an association’s claims exposure under all of the1960association’s service warranty contracts, wherever written,1961unless all of the following are satisfied:1962(a) The contractual liability policy contains a clause that1963specifically names the service warranty contract holders as sole1964beneficiaries of the contractual liability policy and claims are1965paid directly to the person making a claim under the contract;1966(b) The contractual liability policy meets all other1967requirements of this part, including subsection (3) of this1968section, which are not inconsistent with this subsection;1969(c) The association has been in existence for at least 51970years or the association is a wholly owned subsidiary of a1971corporation that has been in existence and has been licensed as1972a service warranty association in the state for at least 51973years, and:19741. Is listed and traded on a recognized stock exchange; is1975listed in NASDAQ (National Association of Security Dealers1976Automated Quotation system) and publicly traded in the over-the1977counter securities market; is required to file either of Form197810-K, Form 100, or Form 20-G with the United States Securities1979and Exchange Commission; or has American Depository Receipts1980listed on a recognized stock exchange and publicly traded or is1981the wholly owned subsidiary of a corporation that is listed and1982traded on a recognized stock exchange; is listed in NASDAQ1983(National Association of Security Dealers Automated Quotation1984system) and publicly traded in the over-the-counter securities1985market; is required to file Form 10-K, Form 100, or Form 20-G1986with the United States Securities and Exchange Commission; or1987has American Depository Receipts listed on a recognized stock1988exchange and is publicly traded;19892. Maintains outstanding debt obligations, if any, rated in1990the top four rating categories by a recognized rating service;19913. Has and maintains at all times a minimum net worth of1992not less than $10 million as evidenced by audited financial1993statements prepared by an independent certified public1994accountant in accordance with generally accepted accounting1995principles and submitted to the office annually; and19964. Is authorized to do business in this state; and1997(d) The insurer issuing the contractual liability policy:19981. Maintains and has maintained for the preceding 5 years,1999policyholder surplus of at least $100 million and is rated “A”2000or higher by A.M. Best Company or has an equivalent rating by2001another rating company acceptable to the office;20022. Holds a certificate of authority to do business in this2003state and is approved to write this type of coverage; and20043. Acknowledges to the office quarterly that it insures all2005of the association’s claims exposure under contracts delivered2006in this state.2007 2008If all the preceding conditions are satisfied, then the scope of2009coverage under a contractual liability policy shall not be2010required to exceed an association’s claims exposure under2011service warranty contracts delivered in this state.2012 Section 57. Except as otherwise expressly provided in this 2013 act, this act shall take effect upon becoming a law.