Florida Senate - 2011 SENATOR AMENDMENT
Bill No. CS for CS for SB 1252
Barcode 694784
LEGISLATIVE ACTION
Senate . House
.
.
.
Floor: 1/AD/2R .
05/02/2011 03:24 PM .
—————————————————————————————————————————————————————————————————
—————————————————————————————————————————————————————————————————
Senator Smith moved the following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Subsection (1) of section 440.12, Florida
6 Statutes, is amended to read:
7 440.12 Time for commencement and limits on weekly rate of
8 compensation.—
9 (1) No Compensation is not shall be allowed for the first 7
10 days of the disability, except for benefits provided under for
11 in s. 440.13. However, if the injury results in disability of
12 more than 21 days, compensation shall be allowed from the
13 commencement of the disability.
14 (a) All weekly compensation payments, except for the first
15 payment, shall be paid by check or, if authorized by the
16 employee, on a prepaid card pursuant to paragraph (b) or
17 deposited directly into the employee’s account at a financial
18 institution. As used in this subsection, the term “financial
19 institution” means a financial institution as defined in s.
20 655.005(1)(h).
21 (b) Upon receipt of authorization by the employee as
22 provided in paragraph (a), a carrier may use a prepaid card to
23 deliver the payment of compensation to an employee if the
24 employee is:
25 1. Provided with at least one means of accessing his or her
26 entire compensation payment once per week without incurring
27 fees;
28 2. Provided with the ability to make point-of-sale
29 purchases without incurring fees from the financial institution
30 issuing the prepaid card; and
31 3. Provided with the terms and conditions of the prepaid
32 card program, including a description of any fees that may be
33 assessed.
34 (c) Each carrier shall keep a record of all payments made
35 under this subsection, including the time and manner of such
36 payments, and shall furnish these records or a report based on
37 these records to the Division of Insurance Fraud and the
38 Division of Workers’ Compensation, upon request.
39 (d) The department may adopt rules to administer this
40 section.
41 Section 2. Paragraph (a) of subsection (1) of section
42 440.20, Florida Statutes, is amended to read:
43 440.20 Time for payment of compensation and medical bills;
44 penalties for late payment.—
45 (1)(a) Unless it denies compensability or entitlement to
46 benefits, the carrier shall pay compensation directly to the
47 employee as required by ss. 440.14, 440.15, and 440.16, in
48 accordance with the obligations set forth in those such
49 sections. Upon receipt of the employee’s authorization as
50 provided for in s. 440.12(1)(a) If authorized by the employee,
51 the carrier’s obligation to pay compensation directly to the
52 employee is satisfied when the carrier directly deposits, by
53 electronic transfer or other means, compensation into the
54 employee’s account at a financial institution or onto a prepaid
55 card in accordance with s. 440.12(1). As used in this paragraph,
56 the term “financial institution” means a financial institution
57 as defined in s. 655.005(1)(h). Compensation by direct deposit
58 or through the use of a prepaid card is considered paid on the
59 date the funds become available for withdrawal by the employee.
60 Section 3. Paragraph (b) of subsection (9) of section
61 440.49, Florida Statutes, is amended to read:
62 440.49 Limitation of liability for subsequent injury
63 through Special Disability Trust Fund.—
64 (9) SPECIAL DISABILITY TRUST FUND.—
65 (b)1. The Special Disability Trust Fund shall be maintained
66 by annual assessments upon the insurance companies writing
67 compensation insurance in the state, the commercial self
68 insurers under ss. 624.462 and 624.4621, the assessable mutuals
69 as defined in s. 628.6011, and the self-insurers under this
70 chapter, which assessments shall become due and be paid
71 quarterly at the same time and in addition to the assessments
72 provided in s. 440.51. The department shall estimate annually in
73 advance the amount necessary for the administration of this
74 subsection and the maintenance of this fund and shall make such
75 assessment in the manner hereinafter provided.
76 2. The annual assessment shall be calculated to produce
77 during the next calendar ensuing fiscal year an amount which,
78 when combined with that part of the balance anticipated to be in
79 the fund on December 31 June 30 of the current calendar fiscal
80 year which is in excess of $100,000, is equal to the average of:
81 a. The sum of disbursements from the fund during the
82 immediate past 3 calendar years, and
83 b. Two times the disbursements of the most recent calendar
84 year.
85 c. Such assessment rate shall first apply on a calendar
86 year basis for the period beginning January 1, 2012, and shall
87 be included in workers’ compensation rate filings approved by
88 the office which become effective on or after January 1, 2012.
89 The assessment rate effective January 1, 2011, shall also apply
90 to the interim period from July 1, 2011, through December 31,
91 2011, and shall be included in workers’ compensation rate
92 filings, whether regular or amended, approved by the office
93 which become effective on or after July 1, 2011. Thereafter, the
94 annual assessment rate shall take effect January 1 of the next
95 calendar year and shall be included in workers’ compensation
96 rate filings approved by the office which become effective on or
97 after January 1 of the next calendar year. Assessments shall
98 become due and be paid quarterly.
99
100 Such amount shall be prorated among the insurance companies
101 writing compensation insurance in the state and the self
102 insurers. Provided however, for those carriers that have
103 excluded ceded reinsurance premiums from their assessments on or
104 before January 1, 2000, no assessments on ceded reinsurance
105 premiums shall be paid by those carriers until such time as the
106 former Division of Workers’ Compensation of the Department of
107 Labor and Employment Security or the department advises each of
108 those carriers of the impact that the inclusion of ceded
109 reinsurance premiums has on their assessment. The department may
110 not recover any past underpayments of assessments levied against
111 any carrier that on or before January 1, 2000, excluded ceded
112 reinsurance premiums from their assessment prior to the point
113 that the former Division of Workers’ Compensation of the
114 Department of Labor and Employment Security or the department
115 advises of the appropriate assessment that should have been
116 paid.
117 3. The net premiums written by the companies for workers’
118 compensation in this state and the net premium written
119 applicable to the self-insurers in this state are the basis for
120 computing the amount to be assessed as a percentage of net
121 premiums. Such payments shall be made by each carrier and self
122 insurer to the department for the Special Disability Trust Fund
123 in accordance with such regulations as the department
124 prescribes.
125 4. The Chief Financial Officer is authorized to receive and
126 credit to such Special Disability Trust Fund any sum or sums
127 that may at any time be contributed to the state by the United
128 States under any Act of Congress, or otherwise, to which the
129 state may be or become entitled by reason of any payments made
130 out of such fund.
131 Section 4. Subsection (8) of section 624.402, Florida
132 Statutes, is amended to read:
133 624.402 Exceptions, certificate of authority required.—A
134 certificate of authority shall not be required of an insurer
135 with respect to:
136 (8)(a) An insurer domiciled outside the United States
137 covering only persons who, at the time of issuance or renewal,
138 are nonresidents of the United States if:
139 1. The insurer or any affiliated person as defined in s.
140 624.04 under common ownership or control with the insurer does
141 not solicit, sell, or accept application for any insurance
142 policy or contract to be delivered or issued for delivery to any
143 person in any state;
144 2. The insurer registers with the office via a letter of
145 notification upon commencing business from this state;
146 3. The insurer provides the following information, in
147 English, to the office annually by March 1:
148 a. The name of the insurer, the country of domicile, the
149 address of the insurer’s principal office and office in this
150 state, the names of the owners of the insurer and their
151 percentage of ownership, the names of the officers and directors
152 of the insurer, the name, e-mail, and telephone number of a
153 contact person for the insurer, and the number of individuals
154 who are employed by the insurer or its affiliates in this state;
155 b. The lines of insurance and types of products offered by
156 the insurer;
157 c. A statement from the applicable regulatory body of the
158 insurer’s domicile certifying that the insurer is licensed or
159 registered for those lines of insurance and types of products in
160 that domicile; and
161 d. A copy of the filings required by the applicable
162 regulatory body of the insurer’s country of domicile in that
163 country’s official language or in English, if available;
164 4. All certificates, policies, or contracts issued in this
165 state showing coverage under the insurer’s policy include the
166 following statement in a contrasting color and at least 10-point
167 type: “The policy providing your coverage and the insurer
168 providing this policy have not been approved by the Florida
169 Office of Insurance Regulation”; and
170 5. In the event the insurer ceases to do business from this
171 state, the insurer will provide written notification to the
172 office within 30 days after cessation.
173 (b) For purposes of this subsection, “nonresident” means a
174 person who resides in and maintains a physical place of domicile
175 in a country other than the United States, which he or she
176 recognizes as and intends to maintain as his or her permanent
177 home. A nonresident does not include an unauthorized immigrant
178 present in the United States. Notwithstanding any other
179 provision of law, it is conclusively presumed, for purposes of
180 this subsection, that a person is a resident of the United
181 States if such person has:
182 1. Had his or her principal place of domicile in the United
183 States for 180 days or more in the 365 days prior to issuance or
184 renewal of the policy;
185 2. Registered to vote in any state;
186 3. Made a statement of domicile in any state; or
187 4. Filed for homestead tax exemption on property in any
188 state.
189 (c) Subject to the limitations provided in this subsection,
190 services, including those listed in s. 624.10, may be provided
191 by the insurer or an affiliated person as defined in s. 624.04
192 under common ownership or control with the insurer.
193 (d) An alien insurer transacting insurance in this state
194 without complying with this subsection shall be in violation of
195 this chapter and subject to the penalties provided in s. 624.15.
196 (a) Life insurance policies or annuity contracts issued by an
197 insurer domiciled outside the United States covering only
198 persons who, at the time of issuance, are not residents of the
199 United States and are not nonresidents illegally residing in the
200 United States, provided:
201 1. The insurer must currently be an authorized insurer in
202 its country of domicile as to the kind or kinds of insurance
203 proposed to be offered and must have been such an insurer for
204 not fewer than the immediately preceding 3 years, or must be the
205 wholly owned subsidiary of such authorized insurer or must be
206 the wholly owned subsidiary of an already eligible authorized
207 insurer as to the kind or kinds of insurance proposed for a
208 period of not fewer than the immediately preceding 3 years.
209 However, the office may waive the 3-year requirement if the
210 insurer has operated successfully for a period of at least the
211 immediately preceding year and has capital and surplus of not
212 less than $25 million.
213 2. Before the office may grant eligibility, the requesting
214 insurer shall furnish the office with a duly authenticated copy
215 of its current annual financial statement, in English, and with
216 all monetary values therein expressed in United States dollars,
217 at an exchange rate then-current and shown in the statement, in
218 the case of statements originally made in the currencies of
219 other countries, and with such additional information relative
220 to the insurer as the office may request.
221 3. The insurer must have and maintain surplus as to
222 policyholders of not less than $15 million. Any such surplus as
223 to policyholders shall be represented by investments consisting
224 of eligible investments for like funds of like domestic insurers
225 under part II of chapter 625; however, any such surplus as to
226 policyholders may be represented by investments permitted by the
227 domestic regulator of such alien insurance company if such
228 investments are substantially similar in terms of quality,
229 liquidity, and security to eligible investments for like funds
230 of like domestic insurers under part II of chapter 625.
231 4. The insurer must be of good reputation as to the
232 providing of service to its policyholders and the payment of
233 losses and claims.
234 5. To maintain eligibility, the insurer shall furnish the
235 office within the time period specified in s. 624.424(1)(a) a
236 duly authenticated copy of its current annual and quarterly
237 financial statements, in English, and with all monetary values
238 therein expressed in United States dollars, at an exchange rate
239 then-current and shown in the statement, in the case of
240 statements originally made in the currencies of other countries,
241 and with such additional information relative to the insurer as
242 the office may request.
243 6. An insurer receiving eligibility under this subsection
244 shall agree to make its books and records pertaining to its
245 operations in this state available for inspection during normal
246 business hours upon request of the office.
247 7. The insurer shall provide to the applicant for the
248 policy or contract a copy of the most recent quarterly financial
249 statements of the insurer providing, in clear and conspicuous
250 language:
251 a. The date of organization of the insurer.
252 b. The identity of and rating assigned by each recognized
253 insurance company rating organization that has rated the insurer
254 or, if applicable, that the insurer is unrated.
255 c. That the insurer does not hold a certificate of
256 authority issued in this state and that the office does not
257 exercise regulatory oversight over the insurer.
258 d. The identity and address of the regulatory authority
259 exercising oversight of the insurer.
260
261 This paragraph does not impose upon the office any duty or
262 responsibility to determine the actual financial condition or
263 claims practices of any unauthorized insurer, and the status of
264 eligibility, if granted by the office, indicates only that the
265 insurer appears to be financially sound and to have satisfactory
266 claims practices and that the office has no credible evidence to
267 the contrary.
268 (b) If at any time the office has reason to believe that an
269 insurer issuing policies or contracts pursuant to this
270 subsection is insolvent or is in unsound financial condition,
271 does not make reasonable prompt payment of benefits, or is no
272 longer eligible under the conditions specified in this
273 subsection, the office may conduct an examination or
274 investigation in accordance with s. 624.316, s. 624.3161, or s.
275 624.320 and, if the findings of such examination or
276 investigation warrant, may withdraw the eligibility of the
277 insurer to issue policies or contracts pursuant to this
278 subsection without having a certificate of authority issued by
279 the office.
280 (c) This subsection does not provide an exception to the
281 agent licensure requirements of chapter 626. Any insurer issuing
282 policies or contracts pursuant to this subsection shall appoint
283 the agents that the insurer uses to sell such policies or
284 contracts as provided in chapter 626.
285 (d) An insurer issuing policies or contracts pursuant to
286 this subsection is subject to part IX of chapter 626, Unfair
287 Insurance Trade Practices, and the office may take such actions
288 against the insurer for a violation as are provided in that
289 part.
290 (e) Policies and contracts issued pursuant to this
291 subsection are not subject to the premium tax specified in s.
292 624.509.
293 (f) Applications for life insurance coverage offered under
294 this subsection must contain, in contrasting color and not less
295 than 12-point type, the following statement on the same page as
296 the applicant’s signature:
297
298 This policy is primarily governed by the laws of a
299 foreign country. As a result, all of the rating and
300 underwriting laws applicable to policies filed in this
301 state do not apply to this coverage, which may result
302 in your premiums being higher than would be
303 permissible under a Florida-approved policy. Any
304 purchase of individual life insurance should be
305 considered carefully, as future medical conditions may
306 make it impossible to qualify for another individual
307 life policy. If the insurer issuing your policy
308 becomes insolvent, this policy is not covered by the
309 Florida Life and Health Insurance Guaranty
310 Association. For information concerning individual
311 life coverage under a Florida-approved policy, consult
312 your agent or the Florida Department of Financial
313 Services.
314
315 (g) All life insurance policies and annuity contracts
316 issued pursuant to this subsection must contain on the first
317 page of the policy or contract, in contrasting color and not
318 less than 10-point type, the following statement:
319
320 The benefits of the policy providing your coverage are
321 governed primarily by the law of a country other than
322 the United States.
323
324 (h) All single-premium life insurance policies and single
325 premium annuity contracts issued to persons who are not
326 residents of the United States and are not nonresidents
327 illegally residing in the United States pursuant to this
328 subsection shall be subject to the provisions of chapter 896.
329 Section 5. Paragraph (d) of subsection (8) of section
330 624.424, Florida Statutes, is amended to read:
331 624.424 Annual statement and other information.—
332 (8)
333 (d) An insurer may not use the same accountant or partner
334 of an accounting firm responsible for preparing the report
335 required by this subsection for more than 5 7 consecutive years.
336 Following this period, the insurer may not use such accountant
337 or partner for a period of 5 2 years, but may use another
338 accountant or partner of the same firm. An insurer may request
339 the office to waive this prohibition based upon an unusual
340 hardship to the insurer and a determination that the accountant
341 is exercising independent judgment that is not unduly influenced
342 by the insurer considering such factors as the number of
343 partners, expertise of the partners or the number of insurance
344 clients of the accounting firm; the premium volume of the
345 insurer; and the number of jurisdictions in which the insurer
346 transacts business.
347 Section 6. Effective upon this act becoming a law, section
348 626.207, Florida Statutes, is amended to read:
349 626.207 Disqualification of applicants and licensees;
350 penalties against licensees; rulemaking authority Department
351 rulemaking authority; waiting periods for applicants; penalties
352 against licensees.—
353 (1) For purposes of this section, the term “financial
354 services business” means any financial activity regulated by the
355 Department of Financial Services, the Office of Insurance
356 Regulation, or the Office of Financial Regulation. The
357 department shall adopt rules establishing specific waiting
358 periods for applicants to become eligible for licensure
359 following denial, suspension, or revocation pursuant to s.
360 626.611, s. 626.621, s. 626.8437, s. 626.844, s. 626.935, s.
361 634.181, s. 634.191, s. 634.320, s. 634.321, s. 634.422, s.
362 634.423, s. 642.041, or s. 642.043. The purpose of the waiting
363 periods is to provide sufficient time to demonstrate reformation
364 of character and rehabilitation. The waiting periods shall vary
365 based on the type of conduct and the length of time since the
366 conduct occurred and shall also be based on the probability that
367 the propensity to commit illegal conduct has been overcome. The
368 waiting periods may be adjusted based on aggravating and
369 mitigating factors established by rule and consistent with this
370 purpose.
371 (2) For purposes of this section, the terms “felony of the
372 first degree” and “capital felony” include all felonies
373 designated as such by the Florida Statutes, as well as any
374 felony so designated in the jurisdiction in which the plea is
375 entered or judgment is rendered.
376 (3) An applicant who commits a felony of the first degree,
377 a capital felony, a felony involving money laundering, fraud, or
378 embezzlement, or a felony directly related to the financial
379 services business is permanently barred from applying for a
380 license under this part. This bar applies to convictions, guilty
381 pleas, or nolo contendere pleas, regardless of adjudication, by
382 any applicant, officer, director, majority owner, partner,
383 manager, or other person who manages or controls any applicant.
384 (4) For all other crimes not included in subsection (3),
385 the department shall adopt rules establishing the process and
386 application of disqualifying periods that include:
387 (a) A 15-year disqualifying period for all felonies
388 involving moral turpitude that are not specifically included in
389 the permanent bar contained in subsection (3).
390 (b) A 7-year disqualifying period for all felonies to which
391 neither the permanent bar in subsection (3) nor the 15-year
392 disqualifying period in paragraph (a) applies.
393 (c) A 7-year disqualifying period for all misdemeanors
394 directly related to the financial services business.
395 (5) The department shall adopt rules providing for
396 additional disqualifying periods due to the commitment of
397 multiple crimes and other factors reasonably related to the
398 applicant’s criminal history. The rules shall provide for
399 mitigating and aggravating factors. However, mitigation may not
400 result in a period of disqualification of less than 7 years and
401 may not mitigate the disqualifying periods in paragraphs (4)(b)
402 and (c).
403 (6) For purposes of this section, the disqualifying periods
404 begin upon the applicant’s final release from supervision or
405 upon completion of the applicant’s criminal sentence, including
406 payment of fines, restitution, and court costs for the crime for
407 which the disqualifying period applies.
408 (7) After the disqualifying period has been met, the burden
409 is on the applicant to demonstrate that the applicant has been
410 rehabilitated, does not pose a risk to the insurance-buying
411 public, is fit and trustworthy to engage in the business of
412 insurance pursuant to s. 626.611(7), and is otherwise qualified
413 for licensure.
414 (8)(2) The department shall adopt rules establishing
415 specific penalties against licensees in accordance with ss.
416 626.641 and 626.651 for violations of s. 626.611, s. 626.621, s.
417 626.8437, s. 626.844, s. 626.935, s. 634.181, s. 634.191, s.
418 634.320, s. 634.321, s. 634.422, s. 634.423, s. 642.041, or s.
419 642.043. The purpose of the revocation or suspension is to
420 provide a sufficient penalty to deter future violations of the
421 Florida Insurance Code. The imposition of a revocation or the
422 length of suspension shall be based on the type of conduct and
423 the probability that the propensity to commit further illegal
424 conduct has been overcome at the time of eligibility for
425 relicensure. The revocation or the length of suspension may be
426 adjusted based on aggravating or mitigating factors, established
427 by rule and consistent with this purpose.
428 (9) Section 112.011 does not apply to any applicants for
429 licensure under the Florida Insurance Code, including, but not
430 limited to, agents, agencies, adjusters, adjusting firms,
431 customer representatives, or managing general agents.
432 Section 7. Subsection (3) of section 626.7451, Florida
433 Statutes, is amended to read:
434 626.7451 Managing general agents; required contract
435 provisions.—No person acting in the capacity of a managing
436 general agent shall place business with an insurer unless there
437 is in force a written contract between the parties which sets
438 forth the responsibility for a particular function, specifies
439 the division of responsibilities, and contains the following
440 minimum provisions:
441 (3) All funds collected for the account of the insurer
442 shall be held by the managing general agent in a fiduciary
443 capacity in a bank which is insured by the Federal Deposit
444 Insurance Corporation a member of the Federal Reserve System.
445 The This account shall be used for all payment as directed by
446 the insurer. The managing general agent may retain up to no more
447 than 60 days of estimated claims payments and allocated loss
448 adjustment expenses.
449
450 For the purposes of this section and ss. 626.7453 and 626.7454,
451 the term “controlling person” or “controlling” has the meaning
452 set forth in s. 625.012(5)(b)1., and the term “controlled
453 person” or “controlled” has the meaning set forth in s.
454 625.012(5)(b)2.
455 Section 8. Subsection (4) of section 626.8651, Florida
456 Statutes, is amended to read:
457 626.8651 Public adjuster apprentice license;
458 qualifications.—
459 (4) An applicant must have received designation as an
460 Accredited Claims Adjuster (ACA), as a Certified Adjuster (CA),
461 or as a Certified Claims Adjuster (CCA) after completion of
462 training that qualifies the applicant to engage in the business
463 of a public adjuster apprentice fairly and without injury to the
464 public. Such training and instruction must address adjusting
465 damages and losses under insurance contracts, the terms and
466 effects of insurance contracts, and knowledge of the laws of
467 this state relating to insurance contracts.
468 Section 9. Paragraphs (a) and (b) of subsection (1),
469 paragraphs (a) and (b) of subsection (2), and subsection (4) of
470 section 627.4133, Florida Statutes, are amended to read:
471 627.4133 Notice of cancellation, nonrenewal, or renewal
472 premium.—
473 (1) Except as provided in subsection (2):
474 (a) An insurer issuing a policy providing coverage for
475 workers’ compensation and employer’s liability insurance,
476 property, casualty, except mortgage guaranty, surety, or marine
477 insurance, other than motor vehicle insurance subject to s.
478 627.728, shall give the first-named named insured at least 45
479 days’ advance written notice of nonrenewal or of the renewal
480 premium. If the policy is not to be renewed, the written notice
481 shall state the reason or reasons as to why the policy is not to
482 be renewed. This requirement applies only if the insured has
483 furnished all of the necessary information so as to enable the
484 insurer to develop the renewal premium prior to the expiration
485 date of the policy to be renewed.
486 (b) An insurer issuing a policy providing coverage for
487 property, casualty, except mortgage guaranty, surety, or marine
488 insurance, other than motor vehicle insurance subject to s.
489 627.728 or s. 627.7281, shall give the first-named named insured
490 written notice of cancellation or termination other than
491 nonrenewal at least 45 days prior to the effective date of the
492 cancellation or termination, including in the written notice the
493 reason or reasons for the cancellation or termination, except
494 that:
495 1. When cancellation is for nonpayment of premium, at least
496 10 days’ written notice of cancellation accompanied by the
497 reason therefor shall be given. As used in this subparagraph and
498 s. 440.42(3), the term “nonpayment of premium” means failure of
499 the named insured to discharge when due any of her or his
500 obligations in connection with the payment of premiums on a
501 policy or any installment of such premium, whether the premium
502 is payable directly to the insurer or its agent or indirectly
503 under any premium finance plan or extension of credit, or
504 failure to maintain membership in an organization if such
505 membership is a condition precedent to insurance coverage.
506 “Nonpayment of premium” also means the failure of a financial
507 institution to honor an insurance applicant’s check after
508 delivery to a licensed agent for payment of a premium, even if
509 the agent has previously delivered or transferred the premium to
510 the insurer. If a dishonored check represents the initial
511 premium payment, the contract and all contractual obligations
512 shall be void ab initio unless the nonpayment is cured within
513 the earlier of 5 days after actual notice by certified mail is
514 received by the applicant or 15 days after notice is sent to the
515 applicant by certified mail or registered mail, and if the
516 contract is void, any premium received by the insurer from a
517 third party shall be refunded to that party in full; and
518 2. When such cancellation or termination occurs during the
519 first 90 days during which the insurance is in force and the
520 insurance is canceled or terminated for reasons other than
521 nonpayment of premium, at least 20 days’ written notice of
522 cancellation or termination accompanied by the reason therefor
523 shall be given except where there has been a material
524 misstatement or misrepresentation or failure to comply with the
525 underwriting requirements established by the insurer.
526
527 After the policy has been in effect for 90 days, no such policy
528 shall be canceled by the insurer except when there has been a
529 material misstatement, a nonpayment of premium, a failure to
530 comply with underwriting requirements established by the insurer
531 within 90 days of the date of effectuation of coverage, or a
532 substantial change in the risk covered by the policy or when the
533 cancellation is for all insureds under such policies for a given
534 class of insureds. This subsection does not apply to
535 individually rated risks having a policy term of less than 90
536 days.
537 (2) With respect to any personal lines or commercial
538 residential property insurance policy, including, but not
539 limited to, any homeowner’s, mobile home owner’s, farmowner’s,
540 condominium association, condominium unit owner’s, apartment
541 building, or other policy covering a residential structure or
542 its contents:
543 (a) The insurer shall give the first-named named insured at
544 least 45 days’ advance written notice of the renewal premium.
545 (b) The insurer shall give the first-named named insured
546 written notice of nonrenewal, cancellation, or termination at
547 least 100 days prior to the effective date of the nonrenewal,
548 cancellation, or termination. However, the insurer shall give at
549 least 100 days’ written notice, or written notice by June 1,
550 whichever is earlier, for any nonrenewal, cancellation, or
551 termination that would be effective between June 1 and November
552 30. The notice must include the reason or reasons for the
553 nonrenewal, cancellation, or termination, except that:
554 1. The insurer shall give the first-named named insured
555 written notice of nonrenewal, cancellation, or termination at
556 least 180 days prior to the effective date of the nonrenewal,
557 cancellation, or termination for a first-named named insured
558 whose residential structure has been insured by that insurer or
559 an affiliated insurer for at least a 5-year period immediately
560 prior to the date of the written notice.
561 2. When cancellation is for nonpayment of premium, at least
562 10 days’ written notice of cancellation accompanied by the
563 reason therefor shall be given. As used in this subparagraph,
564 the term “nonpayment of premium” means failure of the named
565 insured to discharge when due any of her or his obligations in
566 connection with the payment of premiums on a policy or any
567 installment of such premium, whether the premium is payable
568 directly to the insurer or its agent or indirectly under any
569 premium finance plan or extension of credit, or failure to
570 maintain membership in an organization if such membership is a
571 condition precedent to insurance coverage. “Nonpayment of
572 premium” also means the failure of a financial institution to
573 honor an insurance applicant’s check after delivery to a
574 licensed agent for payment of a premium, even if the agent has
575 previously delivered or transferred the premium to the insurer.
576 If a dishonored check represents the initial premium payment,
577 the contract and all contractual obligations shall be void ab
578 initio unless the nonpayment is cured within the earlier of 5
579 days after actual notice by certified mail is received by the
580 applicant or 15 days after notice is sent to the applicant by
581 certified mail or registered mail, and if the contract is void,
582 any premium received by the insurer from a third party shall be
583 refunded to that party in full.
584 3. When such cancellation or termination occurs during the
585 first 90 days during which the insurance is in force and the
586 insurance is canceled or terminated for reasons other than
587 nonpayment of premium, at least 20 days’ written notice of
588 cancellation or termination accompanied by the reason therefor
589 shall be given except where there has been a material
590 misstatement or misrepresentation or failure to comply with the
591 underwriting requirements established by the insurer.
592 4. The requirement for providing written notice of
593 nonrenewal by June 1 of any nonrenewal that would be effective
594 between June 1 and November 30 does not apply to the following
595 situations, but the insurer remains subject to the requirement
596 to provide such notice at least 100 days prior to the effective
597 date of nonrenewal:
598 a. A policy that is nonrenewed due to a revision in the
599 coverage for sinkhole losses and catastrophic ground cover
600 collapse pursuant to s. 627.706, as amended by s. 30, chapter
601 2007-1, Laws of Florida.
602 b. A policy that is nonrenewed by Citizens Property
603 Insurance Corporation, pursuant to s. 627.351(6), for a policy
604 that has been assumed by an authorized insurer offering
605 replacement or renewal coverage to the policyholder.
606
607 After the policy has been in effect for 90 days, the policy
608 shall not be canceled by the insurer except when there has been
609 a material misstatement, a nonpayment of premium, a failure to
610 comply with underwriting requirements established by the insurer
611 within 90 days of the date of effectuation of coverage, or a
612 substantial change in the risk covered by the policy or when the
613 cancellation is for all insureds under such policies for a given
614 class of insureds. This paragraph does not apply to individually
615 rated risks having a policy term of less than 90 days.
616 (4) Notwithstanding the provisions of s. 440.42(3), if
617 cancellation of a policy providing coverage for workers’
618 compensation and employer’s liability insurance is requested in
619 writing by the insured, such cancellation shall be effective on
620 the date requested by the insured or, if no date is specified by
621 the insured, cancellation shall be effective on the date of the
622 written request. The carrier is not required to send notice of
623 cancellation to the insured if the cancellation is requested in
624 writing by the insured the carrier sends the notice of
625 cancellation to the insured. Any retroactive assumption of
626 coverage and liabilities under a policy providing workers’
627 compensation and employer’s liability insurance may not exceed
628 21 days.
629 Section 10. Subsection (3) is added to section 627.4137,
630 Florida Statutes, to read:
631 627.4137 Disclosure of certain information required.—
632 (3) Any request made to a self-insured corporation pursuant
633 to this section shall be sent by certified mail to the
634 registered agent of the disclosing entity.
635 Section 11. Subsection (2) of section 627.7277, Florida
636 Statutes, is amended to read:
637 627.7277 Notice of renewal premium.—
638 (2) An insurer shall mail or deliver to the first-named
639 insured its policyholder at least 30 days’ advance written
640 notice of the renewal premium for the policy.
641 Section 12. Paragraph (a) of subsection (3), paragraphs (a)
642 and (d) of subsection (4), and subsections (5) and (6) of
643 section 627.728, Florida Statutes, are amended to read:
644 627.728 Cancellations; nonrenewals.—
645 (3)(a) No notice of cancellation of a policy to which this
646 section applies shall be effective unless mailed or delivered by
647 the insurer to the first-named named insured and to the first
648 named named insured’s insurance agent at least 45 days prior to
649 the effective date of cancellation, except that, when
650 cancellation is for nonpayment of premium, at least 10 days’
651 notice of cancellation accompanied by the reason therefor shall
652 be given. No notice of cancellation of a policy to which this
653 section applies shall be effective unless the reason or reasons
654 for cancellation accompany the notice of cancellation.
655 (4)(a) No insurer shall fail to renew a policy unless it
656 mails or delivers to the first-named named insured, at the
657 address shown in the policy, and to the first-named named
658 insured’s insurance agent at her or his business address, at
659 least 45 days’ advance notice of its intention not to renew; and
660 the reasons for refusal to renew must accompany such notice.
661 This subsection does not apply:
662 1. If the insurer has manifested its willingness to renew;
663 or
664 2. In case of nonpayment of premium.
665
666 Notwithstanding the failure of an insurer to comply with this
667 subsection, the policy shall terminate on the effective date of
668 any other automobile liability insurance policy procured by the
669 insured with respect to any automobile designated in both
670 policies. Unless a written explanation for refusal to renew
671 accompanies the notice of intention not to renew, the policy
672 shall remain in full force and effect.
673 (d) Instead of canceling or nonrenewing a policy, an
674 insurer may, upon expiration of the policy term, transfer a
675 policy to another insurer under the same ownership or management
676 as the transferring insurer, by giving the first-named named
677 insured at least 45 days’ advance notice of its intent to
678 transfer the policy and of the premium and the specific reasons
679 for any increase in the premium.
680 (5) United States postal proof of mailing or certified or
681 registered mailing of notice of cancellation, of intention not
682 to renew, or of reasons for cancellation, or of the intention of
683 the insurer to issue a policy by an insurer under the same
684 ownership or management, to the first-named named insured at the
685 address shown in the policy shall be sufficient proof of notice.
686 (6) When a policy is canceled, other than for nonpayment of
687 premium, or in the event of failure to renew a policy to which
688 subsection (4) applies, the insurer shall notify the first-named
689 named insured of her or his possible eligibility for insurance
690 through the Automobile Joint Underwriting Association. Such
691 notice shall accompany or be included in the notice of
692 cancellation or the notice of intent not to renew and shall
693 state that such notice of availability of the Automobile Joint
694 Underwriting Association is given pursuant to this section.
695 Section 13. Section 627.7281, Florida Statutes, is amended
696 to read:
697 627.7281 Cancellation notice.—An insurer issuing a policy
698 of motor vehicle insurance not covered under the cancellation
699 provisions of s. 627.728 shall give the first-named named
700 insured notice of cancellation at least 45 days prior to the
701 effective date of cancellation, except that, when cancellation
702 is for nonpayment of premium, at least 10 days’ notice of
703 cancellation accompanied by the reason therefor shall be given.
704 As used in this section, “policy” does not include a binder as
705 defined in s. 627.420 unless the duration of the binder period
706 exceeds 60 days.
707 Section 14. Section 634.403, Florida Statutes, is amended
708 to read:
709 634.403 License required; exemptions.—
710 (1) No person in this state shall provide or offer to
711 provide service warranties to residents of this state unless
712 authorized therefor under a subsisting license issued by the
713 office. The service warranty association shall pay to the office
714 a license fee of $200 for such license for each license year, or
715 part thereof, the license is in force.
716 (2) An insurer, while authorized to transact property or
717 casualty insurance in this state, may also transact a service
718 warranty business without additional qualifications or
719 authority, but shall be otherwise subject to the applicable
720 provisions of this part.
721 (3) The office may, pursuant to s. 120.569, in its
722 discretion and without advance notice and hearing, issue an
723 immediate final order to cease and desist to any person or
724 entity which violates this section. The Legislature finds that a
725 violation of this section constitutes an imminent and immediate
726 threat to the public health, safety, and welfare of the
727 residents of this state.
728 (4) Any person that is an affiliate of a domestic insurer
729 as defined in chapter 624 is exempt from application of this
730 part if the person does not issue, or market or cause to be
731 marketed, service warranties to residents of this state and does
732 not administer service warranties that were originally issued to
733 residents of this state. The domestic insurer or its wholly
734 owned Florida licensed insurer must be the direct obligor of all
735 service warranties issued by such affiliate or must issue a
736 contractual liability insurance policy to such affiliate that
737 meets the conditions described in s. 634.406(3). If the Office
738 of Insurance Regulation determines, after notice and opportunity
739 for a hearing, that a person’s intentional business practices do
740 not comply with any of the exemption requirements of this
741 subsection, the person shall be subject to this part.
742 (5) A person is exempt from the license requirement in this
743 section if the person complies with the following:
744 (a) The service warranties are only sold to nonresidents of
745 this state and the person does not issue, market, or cause to be
746 marketed service warranties to residents of this state.
747 (b) The person submits a letter of notification that
748 provides the following information to the office upon the start
749 of business from this state and annually thereafter by March 1:
750 1. The type of products offered and a statement certifying
751 that the products are not regulated in the state in which the
752 person is transacting business or that the person is licensed in
753 the state in which the person is transacting business.
754 2. The name of the person, the state of domicile, the home
755 address and address in this state of the person, the names of
756 the owners and their percentage of ownership, the names of the
757 officers and directors, the name, e-mail, and telephone number
758 of a contact person, the states in which the person is
759 transacting business, and how many individuals are employed in
760 this state.
761 (c) If the person ceases to do business from this state,
762 the person shall provide written notification to the office
763 within 30 days after cessation of business.
764 (6)(5) Any person who provides, offers to provide, or holds
765 oneself out as providing or offering to provide a service
766 warranty to residents of in this state or from this state
767 without holding a subsisting license commits, in addition to any
768 other violation, a misdemeanor of the first degree, punishable
769 as provided in s. 775.082 or s. 775.083.
770 Section 15. Section 627.442, Florida Statutes, is amended
771 to read:
772 627.442 Insurance contracts.—
773 (1) A person who requires a workers’ compensation insurance
774 policy pursuant to a construction contract may not reject a
775 workers’ compensation insurance policy issued by a self
776 insurance fund that is subject to part V of chapter 631 based
777 upon the self-insurance fund not being rated by a nationally
778 recognized insurance rating service.
779 (2) Notwithstanding s. 440.381(3), premium audits are not
780 required for workers’ compensation coverage, other than an audit
781 required by the insurance policy or an order of the office, or
782 at least once each policy period, if requested by the insured.
783 Section 16. Subsections (4) and (7) of section 627.7295,
784 Florida Statutes, are amended to read:
785 627.7295 Motor vehicle insurance contracts.—
786 (4) If subsection (7) does not apply, the insurer may
787 cancel the policy in accordance with this code except that,
788 notwithstanding s. 627.728, an insurer may not cancel a new
789 policy or binder during the first 60 days immediately following
790 the effective date of the policy or binder except for nonpayment
791 of premium unless the reason for the cancellation is the
792 issuance of a check for the premium that is dishonored for any
793 reason.
794 (7) A policy of private passenger motor vehicle insurance
795 or a binder for such a policy may be initially issued in this
796 state only if, before the effective date of such binder or
797 policy, the insurer or agent has collected from the insured an
798 amount equal to 2 months’ premium. An insurer, agent, or premium
799 finance company may not, directly or indirectly, take any action
800 resulting in the insured having paid from the insured’s own
801 funds an amount less than the 2 months’ premium required by this
802 subsection. This subsection applies without regard to whether
803 the premium is financed by a premium finance company or is paid
804 pursuant to a periodic payment plan of an insurer or an
805 insurance agent. This subsection does not apply if an insured or
806 member of the insured’s family is renewing or replacing a policy
807 or a binder for such policy written by the same insurer or a
808 member of the same insurer group. This subsection does not apply
809 to an insurer that issues private passenger motor vehicle
810 coverage primarily to active duty or former military personnel
811 or their dependents. This subsection does not apply if all
812 policy payments are paid pursuant to a payroll deduction plan or
813 an automatic electronic funds transfer payment plan from the
814 policyholder, provided that the first policy payment is made by
815 cash, cashier’s check, check, or a money order. This subsection
816 and subsection (4) do not apply if all policy payments to an
817 insurer are paid pursuant to an automatic electronic funds
818 transfer payment plan from an agent, a managing general agent,
819 or a premium finance company and if the policy includes, at a
820 minimum, personal injury protection pursuant to ss. 627.730
821 627.7405; motor vehicle property damage liability pursuant to s.
822 627.7275; and bodily injury liability in at least the amount of
823 $10,000 because of bodily injury to, or death of, one person in
824 any one accident and in the amount of $20,000 because of bodily
825 injury to, or death of, two or more persons in any one accident.
826 This subsection and subsection (4) do not apply if an insured
827 has had a policy in effect for at least 6 months, the insured’s
828 agent is terminated by the insurer that issued the policy, and
829 the insured obtains coverage on the policy’s renewal date with a
830 new company through the terminated agent.
831 Section 17. Subsection (3) of section 626.916, Florida
832 Statutes, is amended to read:
833 626.916 Eligibility for export.—
834 (3)(a) Subsection (1) does not apply to wet marine and
835 transportation or aviation risks which are subject to s.
836 626.917.
837 (b) Paragraphs (1)(a)–(d) do not apply to classes of
838 insurance which are subject to s. 627.062(3)(d)1. These classes
839 may be exportable under the following conditions:
840 1. The insurance must be placed only by or through a
841 surplus lines agent licensed in this state;
842 2. The insurer must be made eligible under s. 626.918; and
843 3. The insured must sign a disclosure that substantially
844 provides the following: “You are agreeing to place coverage in
845 the surplus lines market. Superior coverage may be available in
846 the admitted market and at a lesser cost. Persons insured by
847 surplus lines carriers are not protected under the Florida
848 Insurance Guaranty Act with respect to any right of recovery for
849 the obligation of an insolvent unlicensed insurer.” If the
850 notice is signed by the insured, the insured is presumed to have
851 been informed and to know that other coverage may be available,
852 and, with respect to the diligent-effort requirement under
853 subsection (1), there is no liability on the part of, and no
854 cause of action arises against, the retail agent presenting the
855 form.
856 Section 18. The amendments to s. 626.207, Florida Statutes,
857 made by this act do not apply retroactively and apply only to
858 applicants whose applications are pending or submitted on or
859 after the date that the amendments to s. 626.207, Florida
860 Statutes, made by this act become law. This section shall take
861 effect upon this act becoming a law.
862 Section 19. Paragraph (c) of subsection (7) of section
863 817.234, Florida Statutes, is amended, present subsection (12)
864 of that section is renumbered as subsection (13), and a new
865 subsection (12) is added to that section, to read:
866 817.234 False and fraudulent insurance claims.—
867 (7)
868 (c) An insurer, or any person acting at the direction of or
869 on behalf of an insurer, may not change an opinion in a mental
870 or physical report prepared under s. 627.736(8)(7) or direct the
871 physician preparing the report to change such opinion; however,
872 this provision does not preclude the insurer from calling to the
873 attention of the physician errors of fact in the report based
874 upon information in the claim file. Any person who violates this
875 paragraph commits a felony of the third degree, punishable as
876 provided in s. 775.082, s. 775.083, or s. 775.084.
877 (12) In addition to any criminal liability, a person
878 convicted of violating any provision of this section for the
879 purpose of receiving insurance proceeds from a motor vehicle
880 insurance contract is subject to a civil penalty.
881 (a) Except for a violation of subsection (9), the civil
882 penalty shall be:
883 1. A fine up to $5,000 for a first offense.
884 2. A fine greater than $5,000, but not to exceed $10,000,
885 for a second offense.
886 3. A fine greater than $10,000, but not to exceed $15,000,
887 for a third or subsequent offense.
888 (b) The civil penalty for a violation of subsection (9)
889 must be at least $15,000 but may not exceed $50,000.
890 (c) The civil penalty shall be paid to the Insurance
891 Regulatory Trust Fund within the Department of Financial
892 Services and used by the department for the investigation and
893 prosecution of insurance fraud.
894 (d) This subsection does not prohibit a state attorney from
895 entering into a written agreement in which the person charged
896 with the violation does not admit to or deny the charges but
897 consents to payment of the civil penalty.
898 Section 20. Except as otherwise expressly provided in this
899 act and except for this section, which shall take effect upon
900 this act becoming a law, this act shall take effect July 1,
901 2011.
902
903 ================= T I T L E A M E N D M E N T ================
904 And the title is amended as follows:
905 Delete everything before the enacting clause
906 and insert:
907 A bill to be entitled
908 An act relating to insurance; amending s. 440.12,
909 F.S.; authorizing payment of workers’ compensation
910 benefits on a prepaid card under certain
911 circumstances; requiring the keeping and furnishing,
912 upon request, of certain records; providing for the
913 adoption of rules; amending s. 440.20, F.S.;
914 specifying when an insurer’s obligation to pay
915 workers’ compensation benefits is satisfied if payment
916 is made on a prepaid card; amending s. 440.49, F.S.;
917 revising the dates applicable to calculations of
918 annual assessments upon certain workers’ compensation
919 insurers relating to the special disability trust
920 fund; providing application to specified years and
921 rate filings; amending s. 624.402, F.S.; providing an
922 exemption from having to obtain a certificate of
923 authority to insurers that cover only nonresidents of
924 the United States under certain conditions; requiring
925 such insurers to provide certain documentation to the
926 Office of Insurance Regulation; requiring
927 certificates, policies, or contracts issued by such
928 insurers to include a disclaimer relating to the
929 coverage provided; defining a “nonresident” for
930 purposes of applying the exemption provided to such
931 insurers from having to obtain a certificate of
932 authority; providing penalties applicable to alien
933 insurers who transact insurance without complying with
934 certain provisions; deleting procedures and
935 requirements relating to an exemption from obtaining a
936 certificate of authority provided to alien insurers
937 who issue life insurance policies and annuity
938 contracts to certain nonresidents; amending s.
939 624.424, F.S.; revising the timeframes that limit how
940 frequently an insurer may use the same accountant or
941 partner to prepare an annual audited financial report;
942 amending s. 626.207, F.S.; defining the term
943 “financial services business”; precluding licensure
944 under the Florida Insurance Code of specified persons
945 who commit specified offenses; providing application
946 to convictions and certain pleas, regardless of
947 adjudication; establishing waiting periods relating to
948 other specified offenses during which time an
949 applicant is disqualified for licensure; granting
950 rulemaking authority to the Department of Financial
951 Services relating to specific penalties against
952 licensees; clarifying rulemaking authority relating to
953 penalties against licensees; providing that specified
954 statutory provisions prohibiting prior crimes from
955 being a bar to employment are not applicable to
956 applicants for licensure under the Florida Insurance
957 Code; amending s. 626.7451, F.S.; requiring funds
958 collected for an insurer to be held in a bank insured
959 by the Federal Deposit Insurance Corporation; amending
960 s. 626.8651, F.S.; revising requirements for a public
961 adjuster apprentice license to include additional
962 qualifying designations; amending s. 627.4133, F.S.;
963 changing the designated person or persons who must be
964 notified by an insurer from the “insured” to the
965 “first-named insured” in situations involving the
966 nonrenewal, renewal premium, cancellation, or
967 termination of workers’ compensation, employer
968 liability, or certain property and casualty insurance
969 coverage; specifying that the date of cancellation of
970 a workers’ compensation or employer’s liability policy
971 is the date of the insured’s written request to
972 cancel; amending s. 627.4137, F.S.; requiring a
973 claimant’s request concerning insurance coverage to be
974 served upon the disclosing entity in a specified
975 manner; amending s. 627.7277, F.S.; making a
976 conforming change that specifies the “first-named
977 insured” as the person who is to receive notification
978 of a renewal premium; amending s. 627.728, F.S.;
979 changing the designated person or persons who must be
980 notified by an insurer from the “insured” to the
981 “first-named insured” in certain situations involving
982 the cancellation or nonrenewal of motor vehicle
983 insurance coverage; making a conforming change that
984 specifies the “first-named insured’s insurance agent”
985 as a person who is to receive certain notifications
986 relating to motor vehicle insurance coverage; amending
987 s. 627.7281, F.S.; making a conforming change that
988 specifies the “first-named insured” as the person who
989 is to receive notification of cancellation of motor
990 vehicle insurance coverage; amending s. 634.403, F.S.;
991 exempting certain persons providing service warranties
992 relating to consumer products from licensing
993 requirements under certain circumstances; amending s.
994 627.442, F.S.; limiting the requirement for premium
995 audits of workers’ compensation coverage to specified
996 instances; amending s. 627.7295, F.S.; providing
997 application; requiring a certain amount of motor
998 vehicle insurance premium to be paid before the
999 effective date of a policy binder or policy in order
1000 to issue the binder or policy; authorizing an insurer
1001 to cancel certain motor vehicle insurance policies or
1002 binders for nonpayment of premium; removing a
1003 restriction requiring payment of the first policy
1004 payment of a motor vehicle insurance policy before
1005 issuance of a binder or policy when payments are being
1006 made in a specified manner; amending s. 626.916, F.S.;
1007 revising provisions relating to insurance coverage
1008 eligibility for export under the Surplus Lines Law;
1009 providing applicability; amending s. 817.234, F.S.;
1010 revising a cross-reference; providing civil penalties
1011 consisting of monetary fines relating to making false
1012 and fraudulent insurance claims for the purpose of
1013 receiving motor vehicle insurance proceeds; providing
1014 escalating monetary fines for repeat offenses;
1015 providing a mandatory minimum civil fine relating to
1016 certain international motor vehicle accident schemes;
1017 allocating fine revenues to a specified trust fund for
1018 specified purposes; authorizing certain agreements
1019 between a defendant and a state attorney relating to
1020 the payment of civil fines for making false and
1021 fraudulent insurance claims for the purpose of
1022 receiving motor vehicle insurance proceeds; providing
1023 effective dates.