HB 1087, Engrossed 1 2003
1	A bill to be entitled
2	An act relating to insurance; creating s. 255.0517, F.S.;
3	defining terms; limiting the authority of certain public
4	agencies to purchase owner-controlled insurance programs
5	for public construction projects; establishing purchase
6	requirements; providing exemptions; creating s. 627.441,
7	F.S.; requiring insurers issuing commercial general
8	liability policies to offer coverage for completed
9	operations liability for certain contractors to the extent
10	that coverage is not provided under an owner-controlled
11	insurance program; providing an effective date.
12
13	Be It Enacted by the Legislature of the State of Florida:
14
15	Section 1. Section 255.0517, Florida Statutes, is created
16	to read:
17	255.0517 Owner-controlled insurance programs for public
18	construction projects.--
19	(1) DEFINITIONS.--As used in this section, the term:
20	(a) “Owner-controlled insurance program” means a
21	consolidated insurance program or series of insurance policies
22	issued to a public agency that may provide one or more of the
23	following types of insurance coverage for all of the
24	contractors, subcontractors, architects, and engineers working
25	at specified or multiple contracted work sites of a public
26	construction project: general liability, property damage,
27	workers’ compensation, employer’s liability, builder’s risk, or
28	pollution liability coverage.
29	(b) “Specified contracted work site” means construction
30	being performed during one or more fiscal years at one site or a
31	series of contiguous sites separated only by a street, roadway,
32	waterway, or railroad right-of-way or along a continuous system
33	for the provision for water and power.
34	(c) “Multiple contracted work site” means construction
35	being performed at multiple sites during one or more fiscal
36	years that is part of a ongoing capital infrastructure
37	improvement program, or involves the construction of one or more
38	public schools.
39	(2) PURCHASE REQUIREMENTS.--A state agency, political
40	subdivision, state university, community college, airport
41	authority, or other public agency in this state, or any
42	instrumentality thereof, may only purchase an owner-controlled
43	insurance program in connection with a public construction
44	project if it is determined necessary and in the best interest
45	of the public agency and if each of the following conditions is
46	met:
47	(a) The estimated total cost of the project is:
48	1. Seventy-five million dollars or more;
49	2. Thirty million dollars or more, if the project is for
50	the construction or renovation of two or more public schools
51	during a fiscal year; or
52	3. Ten million dollars or more, if the project is for the
53	construction or renovation of one public school, regardless of
54	whether the project’s duration extends beyond a fiscal year.
55	(b) The program maintains completed operations insurance
56	coverage for a term during which the coverage is reasonably
57	commercially available, as determined by the public agency, but
58	for no less than 5 years.
59	(c) The bid or proposal specifications for the project
60	clearly specify, for all bidders or proposers, the insurance
61	coverage provided under the program and the minimum safety
62	requirements that must be met.
63	(d) The program does not prohibit a contractor or
64	subcontractor from purchasing any additional insurance coverage
65	that the contractor or subcontractor believes is necessary for
66	protection against any liability arising out of the contract.
67	The cost of the additional insurance must be disclosed to the
68	public agency.
69	(e) The program does not include surety insurance.
70	(f) The public agency may only purchase an owner-
71	controlled insurance policy that has a deductible or self-
72	insured retention if the deductible or self-insured retention
73	does not exceed $1 million per occurrence.
74	(g) The public agency is responsible for payment of the
75	applicable deductibles of all claims.
76	(3) EXEMPTIONS.--This section does not apply to the
77	following projects:
78	(a) Any project of the Department of Transportation that
79	is authorized under s. 337.11;
80	(b) Any existing project or projects of a public agency
81	that are the subject of an ongoing, owner-controlled insurance
82	program issued before October 1, 2003; or
83	(c) Any project of a public agency that is advertised by
84	the public agency before October 1, 2003, for the purpose of
85	receiving bids or proposals for the project.
86	Section 2. Section 627.441, Florida Statutes, is created
87	to read:
88	627.441 Commercial general liability policies; coverage to
89	contractors for completed operations.--
90	(1) As used in this section, the term:
91	(a) “Contractor” means a contractor, subcontractor,
92	architect, or engineer performing work on a public construction
93	project under contract with a public agency, as described in s.
94	255.0517(2).
95	(b) “Liability insurer” means an insurer issuing a
96	commercial general liability insurance policy in this state to a
97	contractor that provides coverage for liability arising out of
98	completed operations performed by the contractor or on the
99	contractor’s behalf.
100	(2) A liability insurer must offer coverage at an
101	appropriate additional premium for liability arising out of
102	current or completed operations under an owner-controlled
103	insurance program for any period beyond the period for which the
104	program provides liability coverage, as specified in s.
105	255.0517(2)(b). The period of such coverage must be sufficient
106	to protect against liability arising out of an action brought
107	within the time limits provided in s. 95.11(3)(c).
108	Section 3. This act shall take effect October 1, 2003.