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The Florida Senate

2015 Florida Statutes

F.S. 624.316
624.316 Examination of insurers.
(1)(a) The office shall examine the affairs, transactions, accounts, records, and assets of each authorized insurer and of the attorney in fact of a reciprocal insurer as to its transactions affecting the insurer as often as it deems advisable, except as provided in this section. The examination may include examination of the affairs, transactions, accounts, and records relating directly or indirectly to the insurer and of the assets of the insurer’s managing general agents and controlling or controlled person, as defined in s. 625.012. The examination shall be pursuant to a written order of the office. Such order shall expire upon receipt by the office of the written report of the examination.
(b) As a part of its examination procedure, the office shall examine each insurer regarding all of the information required by s. 627.915.
(c) The office shall examine each insurer according to accounting procedures designed to fulfill the requirements of generally accepted insurance accounting principles and practices and good internal control and in keeping with generally accepted accounting forms, accounts, records, methods, and practices relating to insurers. To facilitate uniformity in examinations, the commission may adopt, by rule, the Market Conduct Examiners Handbook and the Financial Condition Examiners Handbook of the National Association of Insurance Commissioners, 2002, and may adopt subsequent amendments thereto, if the examination methodology remains substantially consistent.
(2)(a) Except as provided in paragraph (f), the office may examine each insurer as often as may be warranted for the protection of the policyholders and in the public interest, and shall examine each domestic insurer not less frequently than once every 5 years. The examination shall cover the preceding 5 fiscal years of the insurer and shall be commenced within 12 months after the end of the most recent fiscal year being covered by the examination. The examination may cover any period of the insurer’s operations since the last previous examination. The examination may include examination of events subsequent to the end of the most recent fiscal year and the events of any prior period that affect the present financial condition of the insurer.
(b) The office shall examine each insurer applying for an initial certificate of authority to transact insurance in this state before granting the initial certificate.
(c) In lieu of making its own examination, the office may accept a full report of the last recent examination of a foreign insurer, certified to by the insurance supervisory official of another state.
(d) The examination by the office of an alien insurer shall be limited to the alien insurer’s insurance transactions and affairs in the United States, except as otherwise required by the office.
(e) The commission shall adopt rules providing that an examination under this section may be conducted by independent certified public accountants, actuaries, investment specialists, information technology specialists, and reinsurance specialists meeting criteria specified by rule. The rules shall provide:
1. That the rates charged to the insurer being examined are consistent with rates charged by other firms in a similar profession and are comparable with the rates charged for comparable examinations.
2. That the firm selected by the office to perform the examination has no conflicts of interest that might affect its ability to independently perform its responsibilities on the examination.
3. That the insurer being examined must make payment for the examination pursuant to s. 624.320(1) in accordance with the rates and terms established by the office and the firm performing the examination.
(f) An examination under this section must be conducted at least once every year with respect to a domestic insurer that has continuously held a certificate of authority for less than 3 years. The examination must cover the preceding fiscal year or the period since the last examination of the insurer. The office may limit the scope of the examination.
History.s. 31, ch. 59-205; ss. 12, 13, 35, ch. 69-106; s. 1, ch. 70-324; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 14, ch. 77-468; ss. 2, 3, ch. 81-318; ss. 26, 37, 809(1st), ch. 82-243; s. 1, ch. 85-245; s. 20, ch. 90-119; s. 1, ch. 90-248; ss. 8, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 4, ch. 93-410; s. 87, ch. 98-199; s. 770, ch. 2003-261; s. 1, ch. 2007-224; s. 144, ch. 2008-4.