Florida Senate - 2018 COMMITTEE AMENDMENT Bill No. SB 1168 Ì804018ÉÎ804018 LEGISLATIVE ACTION Senate . House . . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Banking and Insurance (Broxson) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete everything after the enacting clause 4 and insert: 5 Section 1. Section 627.7152, Florida Statutes, is created 6 to read: 7 627.7152 Assignment of property insurance post-loss 8 benefits.— 9 (1) As used in this section, the term “assignment 10 agreement” means any instrument by which post-loss property 11 insurance benefits for services to protect, repair, restore, or 12 replace property, or to mitigate against further damage to 13 property, are assigned, transferred, or conveyed, regardless of 14 how named or styled. 15 (2) Notwithstanding any other law, as to suits based on 16 claims arising under property insurance policies, attorney fees 17 may not be awarded under s. 626.9373 or s. 627.428 in favor of 18 any person or entity seeking relief against the insurer pursuant 19 to an assignment agreement. 20 (3) An assignment agreement is not valid unless it meets 21 all of the following requirements: 22 (a) The assignment agreement is in writing and is executed 23 by all named insureds; 24 (b) The assignment agreement contains a provision that 25 permits all named insureds to rescind the assignment agreement 26 without any penalty or rescission or cancellation fee within 7 27 business days after the date the assignment agreement is 28 executed by all named insureds; 29 (c) The assignment agreement contains a provision requiring 30 the assignee or transferee to provide a copy of the executed 31 assignment agreement to the insurer no later than 3 business 32 days after the assignment agreement is executed by any named 33 insured; and 34 (d) The assignment agreement contains a written, itemized, 35 per-unit cost estimate of the work to be performed by the 36 assignee or transferee. 37 (4) The following provisions may not be included in an 38 assignment agreement and are deemed to be invalid and 39 unenforceable against the property insurer or named insureds: 40 (a) A penalty or fee for rescission of the assignment 41 agreement pursuant to subsection (3); 42 (b) A check or mortgage processing fee; 43 (c) A penalty or fee for cancellation of the assignment 44 agreement pursuant to subsection (3); or 45 (d) An administrative fee. 46 (5) As to claims arising under an assignment agreement, the 47 failure to comply with any provision of this subsection creates 48 a presumption that the insurer is prejudiced by such failure to 49 comply and shifts the burden in any proceeding or suit to the 50 party seeking benefits, rights, or proceeds from the insurer to 51 demonstrate that the insurer was not prejudiced. The assignee or 52 transferee must do all of the following: 53 (a) Maintain records of all services provided under the 54 assignment agreement; 55 (b) Cooperate with the insurer in the investigation of a 56 claim; 57 (c) Provide the insurer with any and all records and 58 documents requested related to services provided and permit the 59 insurer to make copies; 60 (d) Deliver a copy of the executed assignment agreement to 61 the insurer no later than 3 business days after the assignment 62 agreement is executed by all named insureds; and 63 (e) Concurrently with any request for payment of benefits 64 under the insurance policy, provide the insurer with a written, 65 itemized, per-unit cost statement of services actually performed 66 pursuant to the assignment agreement. 67 (6) As to claims arising under an assignment agreement, an 68 assignee must, as a condition precedent to filing a suit under 69 the policy: 70 (a) If required by the insurer, submit to examinations 71 under oath and recorded statements conducted by the insurer or 72 the insurer’s representative which are limited to matters 73 related to the services provided, the costs of services, and the 74 assignment or transfer; and 75 (b) Participate in an appraisal or other alternative 76 dispute resolution method in accordance with the terms of the 77 policy. 78 (7) An activity in compliance with subsections (5) and (6) 79 does not constitute practice as a public adjuster pursuant to 80 part VI of chapter 626. 81 (8) Notwithstanding any other law, the acceptance by a 82 person of any assignment agreement constitutes a waiver by the 83 assignee or transferee, and any subcontractor of the assignee or 84 transferee, of any and all claims against all named insureds for 85 payment arising from the specified loss, except that all named 86 insureds remain responsible for the payment of any deductible 87 amount provided for by the terms of the insurance policy and for 88 the cost of any betterment ordered by all named insureds. This 89 waiver remains in effect notwithstanding any subsequent 90 determination that the assignment agreement is invalid or the 91 rescission of the assignment agreement by all named insureds. 92 (9) This section does not permit an assignment agreement to 93 modify or eliminate any term, condition, or defense relating to 94 any managed repair arrangement provided for in the insurance 95 policy to which the assignment agreement relates. 96 (10) This section does not apply to: 97 (a) An assignment, transfer, or conveyance granted to a 98 subsequent purchaser of property who acquires an insurable 99 interest in the property following a loss; 100 (b) A power of attorney granted to a management company, 101 family member, guardian, or similarly situated person which 102 complies with chapter 709 and which may include, as part of the 103 authority granted, the authority to act on behalf of a principal 104 as it relates to a property insurance claim; or 105 (c) Liability coverage under a property insurance policy. 106 (11) This section applies to assignment agreements that are 107 executed after July 1, 2018. 108 Section 2. (1) Within 60 days after the effective date of 109 this section, the Office of Insurance Regulation shall enter 110 into a contract with an independent consultant to calculate the 111 savings expected as a result of this act. The contract must 112 require the use of generally accepted actuarial techniques and 113 standards in determining the expected impact on losses and 114 expenses. By September 15, 2018, the office shall submit to the 115 Governor, the President of the Senate, and the Speaker of the 116 House of Representatives a report concerning the results of the 117 independent consultant’s calculations. 118 (2) By October 1, 2018, an insurer writing property 119 insurance in this state shall make a rate filing with the Office 120 of Insurance Regulation. A rate certification does not satisfy 121 this requirement. If the insurer requests a rate in excess of a 122 10 percent reduction as applied to the current rate in its 123 overall base rate for property insurance, the insurer must 124 include in its rate filing a detailed explanation of the reasons 125 for its failure to achieve a 10 percent reduction. 126 (3) By January 1, 2020, an insurer writing property 127 insurance in this state shall make a rate filing with the Office 128 of Insurance Regulation. A rate certification does not satisfy 129 this requirement. If the insurer requests a rate in excess of a 130 25 percent reduction as applied to the rate in effect as of July 131 1, 2018, in its overall base rate for property insurance since 132 July 1, 2018, the insurer must include in its rate filing a 133 detailed explanation of the reasons for its failure to achieve a 134 25 percent reduction. 135 (4) If an insurer fails to provide the detailed explanation 136 required by subsection (2) or subsection (3), the Office of 137 Insurance Regulation must order the insurer to stop writing new 138 property insurance policies in this state until it provides the 139 required explanation. 140 (5) The sum of $200,000 of nonrecurring revenue is 141 appropriated from the Insurance Regulatory Trust Fund to the 142 Office of Insurance Regulation for the purpose of implementing 143 the requirements of subsection (1) during the 2017-2018 fiscal 144 year. Any unexpended balance of the appropriation at the end of 145 the fiscal year shall be carried forward and be available for 146 expenditure for that purpose during the 2018-2019 fiscal year. 147 Notwithstanding s. 287.057, Florida Statutes, the office may 148 retain an independent consultant to implement the requirements 149 of subsection (1) without a competitive solicitation. 150 (6) This section shall take effect upon this act becoming a 151 law. 152 Section 3. Except as otherwise expressly provided in this 153 act and except for this section, which shall take effect upon 154 this act becoming a law, this act shall take effect July 1, 155 2018. 156 157 ================= T I T L E A M E N D M E N T ================ 158 And the title is amended as follows: 159 Delete everything before the enacting clause 160 and insert: 161 A bill to be entitled 162 An act relating to the assignment of property 163 insurance benefits; creating s. 627.7152, F.S.; 164 defining the term “assignment agreement”; prohibiting 165 certain awards of attorney fees to certain persons or 166 entities in suits based on claims arising under 167 property insurance policies; providing that an 168 assignment agreement is not valid unless specified 169 requirements are met; prohibiting certain provisions 170 in an assignment agreement; specifying requirements 171 for an assignee or transferee; requiring an assignee 172 to meet certain requirements as a condition precedent 173 to filing suit under a policy; providing construction; 174 providing applicability; requiring the Office of 175 Insurance Regulation, within a specified timeframe, to 176 contract with an independent consultant to calculate 177 expected savings as a result of this act; requiring 178 the contract to require the use of certain actuarial 179 techniques and standards; requiring the office to 180 submit a certain report to the Governor and the 181 Legislature by a specified date; requiring property 182 insurers to make rate filings with the office by 183 specified dates; providing construction; requiring an 184 insurer to include a certain explanation in its rate 185 filing under certain circumstances; requiring the 186 office to order an insurer that fails to provide such 187 explanation to stop writing new property insurance 188 policies until it provides the explanation; providing 189 an appropriation; authorizing the office to retain the 190 consultant without a competitive solicitation; 191 providing effective dates.