HB 7077

1	A bill to be entitled
2	An act relating to insurance; amending s. 163.01, F.S.;
3	correcting a cross-reference; amending s. 215.555, F.S.;
4	revising certain reimbursement contract requirements;
5	deleting an expiration provision relating to obtaining
6	coverage for liquidated insurers; delaying repeal of an
7	exemption of medical malpractice insurance premiums from
8	emergency assessments; revising criteria, requirements,
9	and limitations on temporary emergency options for
10	additional coverage under the Florida Hurricane
11	Catastrophe Fund; amending s. 215.5595, F.S.; providing an
12	exception to certain surplus note limitations for certain
13	manufactured housing insurers; amending s. 624.407, F.S.;
14	revising an insurer criterion for capital funds
15	requirements for new insurers; amending s. 624.408, F.S.;
16	specifying an additional surplus to policyholder amount
17	requirement for certain insurers; amending s. 626.9201,
18	F.S.; defining the term "nonpayment of premium"; providing
19	additional criterion for cancellation for nonpayment of
20	premium; amending s. 627.0613, F.S.; limiting application
21	of certain annual report card preparation powers of the
22	consumer advocate to personal residential property
23	insurers; amending s. 627.062, F.S.; specifying
24	application of certain "file and use" requirements to
25	property insurance only; excluding certain motor vehicle
26	coverages; amending s. 627.0655, F.S.; revising criteria
27	for certain inclusion of discounts in certain premiums;
28	amending s. 627.351, F.S.; revising legislative findings
29	and intent; limiting application of the term "subject
30	lines of business" to deficit assessments; revising a
31	provision for determining eligibility of a risk for
32	coverage; providing requirements for determining
33	comparable coverage; revising requirements relating to
34	senior management employees and members of the board of
35	governors; authorizing the office to create a pilot
36	program for the offering of optional sinkhole coverage in
37	one or more counties or other territories of the
38	corporation; revising rate filings provisions; amending s.
39	627.3511, F.S.; correcting a cross-reference; amending s.
40	627.3515, F.S.; revising criteria for an electronic
41	database for a business plan; amending s. 627.3517, F.S.;
42	deleting a provision specifying nonapplication for a
43	certain period; amending s. 627.4035, F.S.; revising a
44	premium payment plan option provision for certain
45	insurers; amending s. 627.4133, F.S.; specifying
46	requirements for notices of renewal premium of property
47	insurance policies; authorizing the Financial Services
48	Commission to adopt rules; amending s. 627.701, F.S.;
49	revising requirements for deductibles for certain personal
50	lines residential property insurance policies; amending s.
51	627.70131, F.S.; revising certain payment or denial of
52	claim requirements; requiring an insurer to pay or deny a
53	claim within a certain time period; providing requirements
54	for payment of interest on overdue claims; prohibiting the
55	expensing of interest paid in future rate filings;
56	prohibiting contractual waivers, voidances, or
57	nullifications; specifying regulatory action as an
58	exclusive remedy for certain violations; amending s.
59	627.712, F.S.; limiting application of certain residential
60	hurricane coverage requirements to property insurance
61	policies; specifying separate coverage exclusion
62	statements for policyholders that are natural persons and
63	other than natural persons; specifying a period of
64	application of certain exclusions; providing for
65	implementation of changes to certain exclusions; amending
66	s. 627.7277, F.S.; deleting certain notice of renewal
67	premium requirements; deleting authority of the commission
68	to adopt rules; amending s. 631.52, F.S.; expanding an
69	exception to application to self insurance of provisions
70	relating to Florida Insurance Guaranty of Payment;
71	amending s. 631.57, F.S.; revising certain emergency
72	assessment provisions relating to insurers rendered
73	insolvent by the effects of hurricanes; amending s.
74	631.695, F.S.; deleting provisions limiting application of
75	certain revenue bond issuance authority to certain
76	counties; preserving certain Florida Building Code
77	internal design options for certain building permits for a
78	certain time; providing for retroactive application;
79	providing severability; creating s. 624.46226; permitting
80	two or more public housing authorities to create a self-
81	insurance fund for specified purposes; providing effective
82	dates.
83
84	Be It Enacted by the Legislature of the State of Florida:
85
86	Section 1.  Paragraph (h) of subsection (7) of section
87	163.01, Florida Statutes, as amended by chapter 2007-1, Laws of
88	Florida, is amended to read:
89	163.01  Florida Interlocal Cooperation Act of 1969.--
90	(7)
91	(h)1.  Notwithstanding the provisions of paragraph (c), any
92	separate legal entity consisting of an alliance, as defined in
93	s. 395.106(2)(a), created pursuant to this paragraph and
94	controlled by and whose members consist of eligible entities
95	comprised of special districts created pursuant to a special act
96	and having the authority to own or operate one or more hospitals
97	licensed in this state or hospitals licensed in this state that
98	are owned, operated, or funded by a county or municipality, for
99	the purpose of providing property insurance coverage as defined
100	in s. 395.106(2)(b)(c), for such eligible entities, may exercise
101	all powers under this subsection in connection with borrowing
102	funds for such purposes, including, without limitation, the
103	authorization, issuance, and sale of bonds, notes, or other
104	obligations of indebtedness. Borrowed funds, including, but not
105	limited to, bonds issued by such alliance shall be deemed issued
106	on behalf of such eligible entities that enter into loan
107	agreements with such separate legal entity as provided in this
108	paragraph.
109	2.  Any such separate legal entity shall have all the
110	powers that are provided by the interlocal agreement under which
111	the entity is created or that are necessary to finance, operate,
112	or manage the alliance's property insurance coverage program.
113	Proceeds of bonds, notes, or other obligations issued by such an
114	entity may be loaned to any one or more eligible entities. Such
115	eligible entities are authorized to enter into loan agreements
116	with any separate legal entity created pursuant to this
117	paragraph for the purpose of obtaining moneys with which to
118	finance property insurance coverage or claims. Obligations of
119	any eligible entity pursuant to a loan agreement as described in
120	this paragraph may be validated as provided in chapter 75.
121	3.  Any bonds, notes, or other obligations to be issued or
122	incurred by a separate legal entity created pursuant to this
123	paragraph shall be authorized by resolution of the governing
124	body of such entity and bear the date or dates; mature at the
125	time or times, not exceeding 30 years from their respective
126	dates; bear interest at the rate or rates, which may be fixed or
127	vary at such time or times and in accordance with a specified
128	formula or method of determination; be payable at the time or
129	times; be in the denomination; be in the form; carry the
130	registration privileges; be executed in the manner; be payable
131	from the sources and in the medium of payment and at the place;
132	and be subject to redemption, including redemption prior to
133	maturity, as the resolution may provide. The bonds, notes, or
134	other obligations may be sold at public or private sale for such
135	price as the governing body of the separate legal entity shall
136	determine. The bonds may be secured by such credit enhancement,
137	if any, as the governing body of the separate legal entity deems
138	appropriate. The bonds may be secured by an indenture of trust
139	or trust agreement. In addition, the governing body of the
140	separate legal entity may delegate, to such officer or official
141	of such entity as the governing body may select, the power to
142	determine the time; manner of sale, public or private;
143	maturities; rate or rates of interest, which may be fixed or may
144	vary at such time or times and in accordance with a specified
145	formula or method of determination; and other terms and
146	conditions as may be deemed appropriate by the officer or
147	official so designated by the governing body of such separate
148	legal entity. However, the amounts and maturities of such bonds,
149	the interest rate or rates, and the purchase price of such bonds
150	shall be within the limits prescribed by the governing body of
151	such separate legal entity in its resolution delegating to such
152	officer or official the power to authorize the issuance and sale
153	of such bonds.
154	4.  Bonds issued pursuant to this paragraph may be
155	validated as provided in chapter 75. The complaint in any action
156	to validate such bonds shall be filed only in the Circuit Court
157	for Leon County. The notice required to be published by s. 75.06
158	shall be published in Leon County and in each county in which an
159	eligible entity that is a member of an alliance is located. The
160	complaint and order of the circuit court shall be served only on
161	the State Attorney of the Second Judicial Circuit and on the
162	state attorney of each circuit in each county in which an
163	eligible entity receiving bond proceeds is located.
164	5.  The accomplishment of the authorized purposes of a
165	separate legal entity created under this paragraph is deemed in
166	all respects for the benefit, increase of the commerce and
167	prosperity, and improvement of the health and living conditions
168	of the people of this state. Inasmuch as the separate legal
169	entity performs essential public functions in accomplishing its
170	purposes, the separate legal entity is not required to pay any
171	taxes or assessments of any kind upon any property acquired or
172	used by the entity for such purposes or upon any revenues at any
173	time received by the entity. The bonds, notes, and other
174	obligations of such separate legal entity, the transfer of and
175	income from such bonds, notes, and other obligations, including
176	any profits made on the sale of such bonds, notes, and other
177	obligations, are at all times free from taxation of any kind of
178	the state or by any political subdivision or other agency or
179	instrumentality of the state. The exemption granted in this
180	paragraph does not apply to any tax imposed by chapter 220 on
181	interest, income, or profits on debt obligations owned by
182	corporations.
183	6.  The participation by any eligible entity in an alliance
184	or a separate legal entity created pursuant to this paragraph
185	may not be deemed a waiver of immunity to the extent of
186	liability or any other coverage, and a contract entered
187	regarding such alliance is not required to contain any provision
188	for waiver.
189	Section 2.  Paragraph (b) of subsection (4), paragraph (e)
190	of subsection (5), paragraph (b) of subsection (6), and
191	subsection (16) of section 215.555, Florida Statutes, as amended
192	by chapter 2007-1, Laws of Florida, are amended to read:
193	215.555  Florida Hurricane Catastrophe Fund.--
194	(4)  REIMBURSEMENT CONTRACTS.--
195	(b)1.  The contract shall contain a promise by the board to
196	reimburse the insurer for 45 percent, 75 percent, or 90 percent
197	of its losses from each covered event in excess of the insurer's
198	retention, plus 5 percent of the reimbursed losses to cover loss
199	adjustment expenses.
200	2.  The insurer must elect one of the percentage coverage
201	levels specified in this paragraph and may, upon renewal of a
202	reimbursement contract, elect a lower percentage coverage level
203	if no revenue bonds issued under subsection (6) after a covered
204	event are outstanding, or elect a higher percentage coverage
205	level, regardless of whether or not revenue bonds are
206	outstanding. All members of an insurer group must elect the same
207	percentage coverage level. Any joint underwriting association,
208	risk apportionment plan, or other entity created under s.
209	627.351 must elect the 90-percent coverage level.
210	3.  The contract shall provide that reimbursement amounts
211	shall not be reduced by reinsurance paid or payable to the
212	insurer from other sources.
213	4.  Notwithstanding any other provision contained in this
214	section, the board shall make available to insurers that
215	purchased coverage provided by this subparagraph participated in
216	2006, insurers qualifying as limited apportionment companies
217	under s. 627.351(6)(c) which began writing property insurance in
218	2007, and insurers that were approved to participate in 2006 or
219	that are approved in 2007 for the Insurance Capital Build-Up
220	Incentive Program pursuant to s. 215.5595, a contract or
221	contract addendum that provides an additional amount of
222	reimbursement coverage of up to $10 million. The premium to be
223	charged for this additional reimbursement coverage shall be 50
224	percent of the additional reimbursement coverage provided, which
225	shall include one prepaid reinstatement. The minimum retention
226	level that an eligible participating insurer must retain
227	associated with this additional coverage layer is 30 percent of
228	the insurer's surplus as of December 31, 2006. This coverage
229	shall be in addition to all other coverage that may be provided
230	under this section. The coverage provided by the fund under this
231	subsection shall be in addition to the claims-paying capacity as
232	defined in subparagraph (c)1., but only with respect to those
233	insurers that select the additional coverage option and meet the
234	requirements of this subsection. The claims-paying capacity with
235	respect to all other participating insurers and limited
236	apportionment companies that do not select the additional
237	coverage option shall be limited to their reimbursement
238	premium's proportionate share of the actual claims-paying
239	capacity otherwise defined in subparagraph (c)1. and as provided
240	for under the terms of the reimbursement contract. Coverage
241	provided in the reimbursement contract will not be affected by
242	the additional premiums paid by participating insurers
243	exercising the additional coverage option allowed in this
244	subparagraph. This subparagraph expires on May 31, 2008.
245	(5)  REIMBURSEMENT PREMIUMS.--
246	(e)  If Citizens Property Insurance Corporation assumes or
247	otherwise provides coverage for policies of an insurer placed in
248	liquidation under chapter 631 pursuant to s. 627.351(6), the
249	corporation may, pursuant to conditions mutually agreed to
250	between the corporation and the State Board of Administration,
251	obtain coverage for such policies under its contract with the
252	fund or accept an assignment of the liquidated insurer's
253	contract with the fund. If Citizens Property Insurance
254	Corporation elects to cover these policies under the
255	corporation's contract with the fund, it shall notify the board
256	of its insured values with respect to such policies within a
257	specified time mutually agreed to between the corporation and
258	the board, after such assumption or other coverage transaction,
259	and the fund shall treat such policies as having been in effect
260	as of June 30 of that year. In the event of an assignment, the
261	fund shall apply that contract to such policies and treat
262	Citizens Property Insurance Corporation as if the corporation
263	were the liquidated insurer for the remaining term of the
264	contract, and the corporation shall have all rights and duties
265	of the liquidated insurer beginning on the date it provides
266	coverage for such policies, but the corporation is not subject
267	to any preexisting rights, liabilities, or duties of the
268	liquidated insurer. The assignment, including any unresolved
269	issues between the liquidated insurer and Citizens Property
270	Insurance Corporation under the contract, shall be provided for
271	in the liquidation order or otherwise determined by the court.
272	However, if a covered event occurs before the effective date of
273	the assignment, the corporation may not obtain coverage for such
274	policies under its contract with the fund and shall accept an
275	assignment of the liquidated insurer's contract as provided in
276	this paragraph. This paragraph expires on June 1, 2007.
277	(6)  REVENUE BONDS.--
278	(b)  Emergency assessments.--
279	1.  If the board determines that the amount of revenue
280	produced under subsection (5) is insufficient to fund the
281	obligations, costs, and expenses of the fund and the
282	corporation, including repayment of revenue bonds and that
283	portion of the debt service coverage not met by reimbursement
284	premiums, the board shall direct the Office of Insurance
285	Regulation to levy, by order, an emergency assessment on direct
286	premiums for all property and casualty lines of business in this
287	state, including property and casualty business of surplus lines
288	insurers regulated under part VIII of chapter 626, but not
289	including any workers' compensation premiums or medical
290	malpractice premiums. As used in this subsection, the term
291	"property and casualty business" includes all lines of business
292	identified on Form 2, Exhibit of Premiums and Losses, in the
293	annual statement required of authorized insurers by s. 624.424
294	and any rule adopted under this section, except for those lines
295	identified as accident and health insurance and except for
296	policies written under the National Flood Insurance Program. The
297	assessment shall be specified as a percentage of direct written
298	premium and is subject to annual adjustments by the board in
299	order to meet debt obligations. The same percentage shall apply
300	to all policies in lines of business subject to the assessment
301	issued or renewed during the 12-month period beginning on the
302	effective date of the assessment.
303	2.  A premium is not subject to an annual assessment under
304	this paragraph in excess of 6 percent of premium with respect to
305	obligations arising out of losses attributable to any one
306	contract year, and a premium is not subject to an aggregate
307	annual assessment under this paragraph in excess of 10 percent
308	of premium. An annual assessment under this paragraph shall
309	continue as long as the revenue bonds issued with respect to
310	which the assessment was imposed are outstanding, including any
311	bonds the proceeds of which were used to refund the revenue
312	bonds, unless adequate provision has been made for the payment
313	of the bonds under the documents authorizing issuance of the
314	bonds.
315	3.  Emergency assessments shall be collected from
316	policyholders. Emergency assessments shall be remitted by
317	insurers as a percentage of direct written premium for the
318	preceding calendar quarter as specified in the order from the
319	Office of Insurance Regulation. The office shall verify the
320	accurate and timely collection and remittance of emergency
321	assessments and shall report the information to the board in a
322	form and at a time specified by the board. Each insurer
323	collecting assessments shall provide the information with
324	respect to premiums and collections as may be required by the
325	office to enable the office to monitor and verify compliance
326	with this paragraph.
327	4.  With respect to assessments of surplus lines premiums,
328	each surplus lines agent shall collect the assessment at the
329	same time as the agent collects the surplus lines tax required
330	by s. 626.932, and the surplus lines agent shall remit the
331	assessment to the Florida Surplus Lines Service Office created
332	by s. 626.921 at the same time as the agent remits the surplus
333	lines tax to the Florida Surplus Lines Service Office. The
334	emergency assessment on each insured procuring coverage and
335	filing under s. 626.938 shall be remitted by the insured to the
336	Florida Surplus Lines Service Office at the time the insured
337	pays the surplus lines tax to the Florida Surplus Lines Service
338	Office. The Florida Surplus Lines Service Office shall remit the
339	collected assessments to the fund or corporation as provided in
340	the order levied by the Office of Insurance Regulation. The
341	Florida Surplus Lines Service Office shall verify the proper
342	application of such emergency assessments and shall assist the
343	board in ensuring the accurate and timely collection and
344	remittance of assessments as required by the board. The Florida
345	Surplus Lines Service Office shall annually calculate the
346	aggregate written premium on property and casualty business,
347	other than workers' compensation and medical malpractice,
348	procured through surplus lines agents and insureds procuring
349	coverage and filing under s. 626.938 and shall report the
350	information to the board in a form and at a time specified by
351	the board.
352	5.  Any assessment authority not used for a particular
353	contract year may be used for a subsequent contract year. If,
354	for a subsequent contract year, the board determines that the
355	amount of revenue produced under subsection (5) is insufficient
356	to fund the obligations, costs, and expenses of the fund and the
357	corporation, including repayment of revenue bonds and that
358	portion of the debt service coverage not met by reimbursement
359	premiums, the board shall direct the Office of Insurance
360	Regulation to levy an emergency assessment up to an amount not
361	exceeding the amount of unused assessment authority from a
362	previous contract year or years, plus an additional 4 percent
363	provided that the assessments in the aggregate do not exceed the
364	limits specified in subparagraph 2.
365	6.  The assessments otherwise payable to the corporation
366	under this paragraph shall be paid to the fund unless and until
367	the Office of Insurance Regulation and the Florida Surplus Lines
368	Service Office have received from the corporation and the fund a
369	notice, which shall be conclusive and upon which they may rely
370	without further inquiry, that the corporation has issued bonds
371	and the fund has no agreements in effect with local governments
372	under paragraph (c). On or after the date of the notice and
373	until the date the corporation has no bonds outstanding, the
374	fund shall have no right, title, or interest in or to the
375	assessments, except as provided in the fund's agreement with the
376	corporation.
377	7.  Emergency assessments are not premium and are not
378	subject to the premium tax, to the surplus lines tax, to any
379	fees, or to any commissions. An insurer is liable for all
380	assessments that it collects and must treat the failure of an
381	insured to pay an assessment as a failure to pay the premium. An
382	insurer is not liable for uncollectible assessments.
383	8.  When an insurer is required to return an unearned
384	premium, it shall also return any collected assessment
385	attributable to the unearned premium. A credit adjustment to the
386	collected assessment may be made by the insurer with regard to
387	future remittances that are payable to the fund or corporation,
388	but the insurer is not entitled to a refund.
389	9.  When a surplus lines insured or an insured who has
390	procured coverage and filed under s. 626.938 is entitled to the
391	return of an unearned premium, the Florida Surplus Lines Service
392	Office shall provide a credit or refund to the agent or such
393	insured for the collected assessment attributable to the
394	unearned premium prior to remitting the emergency assessment
395	collected to the fund or corporation.
396	10.  The exemption of medical malpractice insurance
397	premiums from emergency assessments under this paragraph is
398	repealed May 31, 2008 2007, and medical malpractice insurance
399	premiums shall be subject to emergency assessments attributable
400	to loss events occurring in the contract years commencing on
401	June 1, 2008 2007.
402	(16)  TEMPORARY EMERGENCY OPTIONS FOR ADDITIONAL
403	COVERAGE.--
404	(a)  Findings and intent.--
405	1.  The Legislature finds that:
406	a.  Because of temporary disruptions in the market for
407	catastrophic reinsurance, many property insurers were unable to
408	procure reinsurance for the 2006 hurricane season with an
409	attachment point below the insurers' respective Florida
410	Hurricane Catastrophe Fund attachment points, were unable to
411	procure sufficient amounts of such reinsurance, or were able to
412	procure such reinsurance only by incurring substantially higher
413	costs than in prior years.
414	b.  The reinsurance market problems were responsible, at
415	least in part, for substantial premium increases to many
416	consumers and increases in the number of policies issued by the
417	Citizens Property Insurance Corporation.
418	c.  It is likely that the reinsurance market disruptions
419	will not significantly abate prior to the 2007 hurricane season.
420	2.  It is the intent of the Legislature to create a
421	temporary emergency program, applicable to the 2007, 2008, and
422	2009 hurricane seasons, to address these market disruptions and
423	enable insurers, at their option, to procure additional coverage
424	from the Florida Hurricane Catastrophe Fund.
425	(b)  Applicability of other provisions of this
426	section.--All provisions of this section and the rules adopted
427	under this section apply to the program created by this
428	subsection unless specifically superseded by this subsection.
429	(c)  Optional coverage.--For the contract year commencing
430	June 1, 2007, and ending May 31, 2008, the contract year
431	commencing June 1, 2008, and ending May 31, 2009, and the
432	contract year commencing June 1, 2009, and ending May 31, 2010,
433	the board shall offer for each of such years the optional
434	coverage as provided in this subsection.
435	(d)  Additional definitions.--As used in this subsection,
436	the term:
437	1.  "TEACO options" means the temporary emergency
438	additional coverage options created under this subsection.
439	2.  "TEACO insurer" means an insurer that has opted to
440	obtain coverage under the TEACO options in addition to the
441	coverage provided to the insurer under its reimbursement
442	contract.
443	3.  "TEACO reimbursement premium" means the premium charged
444	by the fund for coverage provided under the TEACO options.
445	4.  "TEACO retention" means the amount of losses below
446	which a TEACO insurer is not entitled to reimbursement from the
447	fund under the TEACO option selected. A TEACO insurer's
448	retention options shall be calculated as follows:
449	a.  The board shall calculate and report to each TEACO
450	insurer the TEACO retention multiples. There shall be three
451	TEACO retention multiples for defining coverage. Each multiple
452	shall be calculated by dividing $3 billion, $4 billion, or $5
453	billion by the total estimated mandatory FHCF TEACO
454	reimbursement premium assuming all insurers selected that
455	option. Total estimated TEACO reimbursement premium for purposes
456	of the calculation under this sub-subparagraph shall be
457	calculated using the assumption that all insurers have selected
458	a specific TEACO retention multiple option and have selected the
459	90-percent coverage level.
460	b.  The TEACO retention multiples as determined under sub-
461	subparagraph a. shall be adjusted to reflect the coverage level
462	elected by the insurer. For insurers electing the 90-percent
463	coverage level, the adjusted retention multiple is 100 percent
464	of the amount determined under sub-subparagraph a. For insurers
465	electing the 75-percent coverage level, the retention multiple
466	is 120 percent of the amount determined under sub-subparagraph
467	a. For insurers electing the 45-percent coverage level, the
468	adjusted retention multiple is 200 percent of the amount
469	determined under sub-subparagraph a.
470	c.  An insurer shall determine its provisional TEACO
471	retention by multiplying its estimated mandatory FHCF
472	provisional TEACO reimbursement premium by the applicable
473	adjusted TEACO retention multiple and shall determine its actual
474	TEACO retention by multiplying its actual mandatory FHCF TEACO
475	reimbursement premium by the applicable adjusted TEACO retention
476	multiple.
477	d.  For TEACO insurers who experience multiple covered
478	events causing loss during the contract year, the insurer's full
479	TEACO retention shall be applied to each of the covered events
480	causing the two largest losses for that insurer. For other
481	covered events resulting in losses, the TEACO option does not
482	apply and the insurer's retention shall be one-third of the full
483	retention as calculated under paragraph (2)(e).
484	5.  "TEACO addendum" means an addendum to the reimbursement
485	contract reflecting the obligations of the fund and TEACO
486	insurers under the program created by this subsection.
487	6.  "FHCF" means the Florida Hurricane Catastrophe Fund.
488	(e)  TEACO addendum.--
489	1.  The TEACO addendum shall provide for reimbursement of
490	TEACO insurers for covered events occurring during the contract
491	year, in exchange for the TEACO reimbursement premium paid into
492	the fund under paragraph (f). Any insurer writing covered
493	policies has the option of choosing to accept the TEACO addendum
494	for any of the 3 contract years that the coverage is offered.
495	2.  The TEACO addendum shall contain a promise by the board
496	to reimburse the TEACO insurer for 45 percent, 75 percent, or 90
497	percent of its losses from each covered event in excess of the
498	insurer's TEACO retention, plus 5 percent of the reimbursed
499	losses to cover loss adjustment expenses. The percentage shall
500	be the same as the coverage level selected by the insurer under
501	paragraph (4)(b).
502	3.  The TEACO addendum shall provide that reimbursement
503	amounts shall not be reduced by reinsurance paid or payable to
504	the insurer from other sources.
505	4.  The TEACO addendum shall also provide that the
506	obligation of the board with respect to all TEACO addenda shall
507	not exceed an amount equal to two times the difference between
508	the industry retention level calculated under paragraph (2)(e)
509	and the $3 billion, $4 billion, or $5 billion industry TEACO
510	retention level options actually selected, but in no event may
511	the board's obligation exceed the actual claims-paying capacity
512	of the fund plus the additional capacity created in paragraph
513	(g). If the actual claims-paying capacity and the additional
514	capacity created under paragraph (g) fall short of the board's
515	obligations under the reimbursement contract, each insurer's
516	share of the fund's capacity shall be prorated based on the
517	premium an insurer pays for its mandatory normal reimbursement
518	coverage and the premium paid for its optional TEACO coverage as
519	each such premium bears to the total premiums paid to the fund
520	times the available capacity.
521	5.  The priorities, schedule, and method of reimbursements
522	under the TEACO addendum shall be the same as provided under
523	subsection (4).
524	6.  A TEACO insurer's maximum reimbursement for a single
525	event shall be equal to the product of multiplying its mandatory
526	FHCF premium by the difference between its FHCF retention
527	multiple and its TEACO retention multiple under the TEACO option
528	selected and by the coverage selected under paragraph (4)(b),
529	plus an additional 5 percent for loss adjustment expenses. A
530	TEACO insurer's maximum reimbursement under the TEACO option
531	selected for a TEACO insurer's two largest events addendum shall
532	be twice its maximum reimbursement for a single event calculated
533	by multiplying the insurer's share of the estimated total TEACO
534	reimbursement premium as calculated under sub-subparagraph
535	(d)4.a. by an amount equal to two times the difference between
536	the industry retention level calculated under paragraph (2)(e)
537	and the $3 billion, $4 billion, or $5 billion industry TEACO
538	retention level specified in sub-subparagraph (d)4.a. as
539	selected by the TEACO insurer.
540	(f)  TEACO reimbursement premiums.--
541	1.  Each TEACO insurer shall pay to the fund, in the manner
542	and at the time provided in the reimbursement contract for
543	payment of reimbursement premiums, a TEACO reimbursement premium
544	calculated as specified in this paragraph.
545	2.  The TEACO reimbursement premiums shall be calculated
546	based on the assumption that, if all insurers entering into
547	reimbursement contracts under subsection (4) also accepted the
548	TEACO option:
549	a.  The insurer's industry TEACO reimbursement premium
550	associated with the $3 billion retention option shall would be
551	equal to 85 percent of a TEACO insurer's maximum reimbursement
552	for a single event as calculated under subparagraph (e)6. the
553	difference between the industry retention level calculated under
554	paragraph (2)(e) and the $3 billion industry TEACO retention
555	level.
556	b.  The TEACO reimbursement premium associated with the $4
557	billion retention option shall would be equal to 80 percent of a
558	TEACO insurer's maximum reimbursement for a single event as
559	calculated under subparagraph (e)6. the difference between the
560	industry retention level calculated under paragraph (2)(e) and
561	the $4 billion industry TEACO retention level.
562	c.  The TEACO premium associated with the $5 billion
563	retention option shall would be equal to 75 percent of a TEACO
564	insurer's maximum reimbursement for a single event as calculated
565	under subparagraph (e)6. the difference between the industry
566	retention level calculated under paragraph (2)(e) and the $5
567	billion industry TEACO retention level.
568	3.  Each insurer's TEACO premium shall be calculated based
569	on its share of the total TEACO reimbursement premiums based on
570	its coverage selection under the TEACO addendum.
571	(g)  Effect on claims-paying capacity of the fund.--For the
572	contract term commencing June 1, 2007, the contract year
573	commencing June 1, 2008, and the contract term beginning June 1,
574	2009, the program created by this subsection shall increase the
575	claims-paying capacity of the fund as provided in subparagraph
576	(4)(c)1. by an amount equal to two times the difference between
577	the industry retention level calculated under paragraph (2)(e)
578	and the $3 billion industry TEACO retention level specified in
579	sub-subparagraph (d)4.a. The additional capacity shall apply
580	only to the additional coverage provided by the TEACO option and
581	shall not otherwise affect any insurer's reimbursement from the
582	fund.
583	Section 3.  Paragraph (b) of subsection (2) of section
584	215.5595, Florida Statutes, is amended to read:
585	215.5595  Insurance Capital Build-Up Incentive Program.--
586	(2)  The purpose of this section is to provide surplus
587	notes to new or existing authorized residential property
588	insurers under the Insurance Capital Build-Up Incentive Program
589	administered by the State Board of Administration, under the
590	following conditions:
591	(b)  The insurer must contribute an amount of new capital
592	to its surplus which is at least equal to the amount of the
593	surplus note and must apply to the board by July 1, 2006. If an
594	insurer applies after July 1, 2006, but before June 1, 2007, the
595	amount of the surplus note is limited to one-half of the new
596	capital that the insurer contributes to its surplus, except for
597	an insurer writing only manufactured housing policies, for which
598	the amount of the surplus note is equal to the amount of the new
599	capital that the insurer contributes to its surplus. For
600	purposes of this section, new capital must be in the form of
601	cash or cash equivalents as specified in s. 625.012(1).
602	Section 4.  Subsection (1) of section 624.407, Florida
603	Statutes, as amended by chapter 2007-1, Laws of Florida, is
604	amended to read:
605	624.407  Capital funds required; new insurers.--
606	(1)  To receive authority to transact any one kind or
607	combinations of kinds of insurance, as defined in part V of this
608	chapter, an insurer applying for its original certificate of
609	authority in this state after the effective date of this section
610	shall possess surplus as to policyholders not less than the
611	greater of:
612	(a)  Five million dollars for a property and casualty
613	insurer, or $2.5 million for any other insurer;
614	(b)  For life insurers, 4 percent of the insurer's total
615	liabilities;
616	(c)  For life and health insurers, 4 percent of the
617	insurer's total liabilities, plus 6 percent of the insurer's
618	liabilities relative to health insurance; or
619	(d)  For all insurers other than life insurers and life and
620	health insurers, 10 percent of the insurer's total liabilities;
621
622	however, a domestic insurer that transacts residential property
623	insurance and is a wholly owned subsidiary of an insurer
624	domiciled authorized to do business in any other state shall
625	possess surplus as to policyholders of at least $50 million, but
626	no insurer shall be required under this subsection to have
627	surplus as to policyholders greater than $100 million.
628	Section 5.  Paragraph (a) of subsection (1) of section
629	624.408, Florida Statutes, is amended to read:
630	624.408  Surplus as to policyholders required; new and
631	existing insurers.--
632	(1)(a)  To maintain a certificate of authority to transact
633	any one kind or combinations of kinds of insurance, as defined
634	in part V of this chapter, an insurer in this state shall at all
635	times maintain surplus as to policyholders not less than the
636	greater of:
637	1.  Except as provided in subparagraph 5. and paragraph
638	(b), $1.5 million;
639	2.  For life insurers, 4 percent of the insurer's total
640	liabilities;
641	3.  For life and health insurers, 4 percent of the
642	insurer's total liabilities plus 6 percent of the insurer's
643	liabilities relative to health insurance; or
644	4.  For all insurers other than mortgage guaranty insurers,
645	life insurers, and life and health insurers, 10 percent of the
646	insurer's total liabilities.
647	5.  For property and casualty insurers, $4 million;
648	however, a domestic insurer that transacts residential property
649	insurance and is a wholly owned subsidiary of an insurer
650	domiciled in any other state shall possess surplus as to
651	policyholders of at least $50 million.
652	Section 6.  Subsection (2) of section 626.9201, Florida
653	Statutes, is amended to read:
654	626.9201  Notice of cancellation or nonrenewal.--
655	(2)  An insurer issuing a policy providing coverage for
656	property, casualty, surety, or marine insurance shall give the
657	named insured written notice of cancellation or termination
658	other than nonrenewal at least 45 days prior to the effective
659	date of the cancellation or termination, including in the
660	written notice the reason or reasons for the cancellation or
661	termination, except that:
662	(a)  When cancellation is for nonpayment of premium, at
663	least 10 days' written notice of cancellation accompanied by the
664	reason therefor shall be given. As used in this paragraph, the
665	term "nonpayment of premium" means failure of the named insured
666	to discharge when due any of his or her obligations in
667	connection with the payment of premiums on a policy or any
668	installment of such premium, whether the premium is payable
669	directly to the insurer or its agent or indirectly under any
670	premium finance plan or extension of credit, or failure to
671	maintain membership in an organization if such membership is a
672	condition precedent to insurance coverage. The term "nonpayment
673	of premium" also means the failure of a financial institution to
674	honor an insurance applicant's check after delivery to a
675	licensed agent for payment of a premium, even if the agent has
676	previously delivered or transferred the premium to the insurer.
677	If a correctly dishonored check represents the initial premium
678	payment, the contract and all contractual obligations shall be
679	void ab initio unless the nonpayment is cured within the earlier
680	of 5 days after actual notice by certified mail is received by
681	the applicant or 15 days after notice is sent to the applicant
682	by certified mail or registered mail, and, if the contract is
683	void, any premium received by the insurer from a third party
684	shall be refunded to that party in full; and
685	(b)  When such cancellation or termination occurs during
686	the first 90 days during which the insurance is in force and the
687	insurance is canceled or terminated for reasons other than
688	nonpayment, at least 20 days' written notice of cancellation or
689	termination accompanied by the reason therefor shall be given
690	except where there has been a material misstatement or
691	misrepresentation or failure to comply with the underwriting
692	requirements established by the insurer.
693	Section 7.  Subsection (4) of section 627.0613, Florida
694	Statutes, as amended by chapter 2007-1, Laws of Florida, is
695	amended to read:
696	627.0613  Consumer advocate.--The Chief Financial Officer
697	must appoint a consumer advocate who must represent the general
698	public of the state before the department and the office. The
699	consumer advocate must report directly to the Chief Financial
700	Officer, but is not otherwise under the authority of the
701	department or of any employee of the department. The consumer
702	advocate has such powers as are necessary to carry out the
703	duties of the office of consumer advocate, including, but not
704	limited to, the powers to:
705	(4)  Prepare an annual report card for each authorized
706	personal residential property insurer, on a form and using a
707	letter-grade scale developed by the commission by rule, which
708	grades each insurer based on the following factors:
709	(a)  The number and nature of consumer complaints received
710	by the department against the insurer.
711	(b)  The disposition of all complaints received by the
712	department.
713	(c)  The average length of time for payment of claims by
714	the insurer.
715	(d)  Any other factors the commission identifies as
716	assisting policyholders in making informed choices about
717	homeowner's insurance.
718	Section 8.  Paragraph (a) of subsection (2) of section
719	627.062, Florida Statutes, as amended by chapter 2007-1, Laws of
720	Florida, is amended to read:
721	627.062  Rate standards.--
722	(2)  As to all such classes of insurance:
723	(a)  Insurers or rating organizations shall establish and
724	use rates, rating schedules, or rating manuals to allow the
725	insurer a reasonable rate of return on such classes of insurance
726	written in this state. A copy of rates, rating schedules, rating
727	manuals, premium credits or discount schedules, and surcharge
728	schedules, and changes thereto, shall be filed with the office
729	under one of the following procedures except as provided in
730	subparagraph 3.:
731	1.  If the filing is made at least 90 days before the
732	proposed effective date and the filing is not implemented during
733	the office's review of the filing and any proceeding and
734	judicial review, then such filing shall be considered a "file
735	and use" filing. In such case, the office shall finalize its
736	review by issuance of a notice of intent to approve or a notice
737	of intent to disapprove within 90 days after receipt of the
738	filing. The notice of intent to approve and the notice of intent
739	to disapprove constitute agency action for purposes of the
740	Administrative Procedure Act. Requests for supporting
741	information, requests for mathematical or mechanical
742	corrections, or notification to the insurer by the office of its
743	preliminary findings shall not toll the 90-day period during any
744	such proceedings and subsequent judicial review. The rate shall
745	be deemed approved if the office does not issue a notice of
746	intent to approve or a notice of intent to disapprove within 90
747	days after receipt of the filing.
748	2.  If the filing is not made in accordance with the
749	provisions of subparagraph 1., such filing shall be made as soon
750	as practicable, but no later than 30 days after the effective
751	date, and shall be considered a "use and file" filing. An
752	insurer making a "use and file" filing is potentially subject to
753	an order by the office to return to policyholders portions of
754	rates found to be excessive, as provided in paragraph (h).
755	3.  For all filings made or submitted after January 25,
756	2007, but on or before December 31, 2008, an insurer seeking a
757	rate that is greater than the rate most recently approved by the
758	office shall make a "file and use" filing. This subparagraph
759	applies to property insurance only. For purposes of this
760	subparagraph, motor vehicle collision and comprehensive
761	coverages are not considered to be property coverages.
762
763	The provisions of this subsection shall not apply to workers'
764	compensation and employer's liability insurance and to motor
765	vehicle insurance.
766	Section 9.  Section 627.0655, Florida Statutes, as created
767	by chapter 2007-1, Laws of Florida, is amended to read:
768	627.0655  Policyholder loss or expense-related premium
769	discounts.--An insurer or person authorized to engage in the
770	business of insurance in this state may include, in the premium
771	charged an insured for any policy, contract, or certificate of
772	insurance, a discount based on the fact that another policy,
773	contract, or certificate of any type has been purchased by the
774	insured from the same insurer or insurer group.
775	Section 10.  Paragraphs (a), (b), (c), (d), (m), (n), and
776	(v) of subsection (6) of section 627.351, Florida Statutes, as
777	amended by chapter 2007-1, Laws of Florida, are amended, and
778	paragraph (ff) of that subsection is created, to read:
779	627.351  Insurance risk apportionment plans.--
780	(6)  CITIZENS PROPERTY INSURANCE CORPORATION.--
781	(a)1.  It is the public purpose of this subsection to
782	ensure the existence of an orderly market for property insurance
783	for Florida's residents and businesses. The Legislature finds
784	that actual and threatened catastrophic losses to property in
785	this state from hurricanes have caused insurers are to be
786	unwilling or unable to provide affordable property insurance
787	coverage in this state to the extent sought and needed. The
788	absence of affordable property insurance threatens the public
789	health, safety, and welfare and likewise threatens the economic
790	health of this state. The state therefore has a compelling It is
791	in the public interest and a public purpose to assist in
792	assuring that property in the state is insured so as to
793	facilitate the remediation, reconstruction, and replacement of
794	damaged or destroyed property in order to reduce or avoid the
795	negative effects otherwise resulting to the public health,
796	safety, and welfare; to the economy of the state; and to the
797	revenues of the state and local governments needed to provide
798	for the public welfare. It is necessary, therefore, to provide
799	property insurance to applicants who are in good faith entitled
800	to procure insurance through the voluntary market but are unable
801	to do so. The Legislature intends by this subsection that
802	property insurance be provided and that it continues to be
803	provided, as long as necessary, through Citizens Property
804	Insurance Corporation, a government entity that is an integral
805	part of the state and that is not a private insurance company.
806	Citizens Property Insurance Corporation shall remain subject to
807	all remedies available against an insurer. To that end, the
808	corporation shall strive an entity organized to achieve
809	efficiencies and economies, while providing service to
810	policyholders, applicants, and agents that is no less than the
811	quality generally provided in the voluntary market, for all
812	toward the achievement of the foregoing public purposes. Because
813	it is essential for such government entity the corporation to
814	have the maximum financial resources to pay claims following a
815	catastrophic hurricane, it is the intent of the Legislature that
816	Citizens Property Insurance Corporation continues to be an
817	integral part of this state and that the income of the
818	corporation be exempt from federal income taxation and that
819	interest on the debt obligations issued by the corporation be
820	exempt from federal income taxation.
821	2.  The Residential Property and Casualty Joint
822	Underwriting Association originally created by this statute
823	shall be known, as of July 1, 2002, as the Citizens Property
824	Insurance Corporation. The corporation shall provide insurance
825	for residential and commercial property, for applicants who are
826	in good faith entitled, but are unable, to procure insurance
827	through the voluntary market. The corporation shall operate
828	pursuant to a plan of operation approved by order of the
829	Financial Services Commission. The plan is subject to continuous
830	review by the commission. The commission may, by order, withdraw
831	approval of all or part of a plan if the commission determines
832	that conditions have changed since approval was granted and that
833	the purposes of the plan require changes in the plan. The
834	corporation shall continue to operate pursuant to the plan of
835	operation approved by the Office of Insurance Regulation until
836	October 1, 2006. For the purposes of this subsection,
837	residential coverage includes both personal lines residential
838	coverage, which consists of the type of coverage provided by
839	homeowner's, mobile home owner's, dwelling, tenant's,
840	condominium unit owner's, and similar policies, and commercial
841	lines residential coverage, which consists of the type of
842	coverage provided by condominium association, apartment
843	building, and similar policies.
844	3.  For the purposes of this subsection, the term
845	"homestead property" means:
846	a.  Property that has been granted a homestead exemption
847	under chapter 196;
848	b.  Property for which the owner has a current, written
849	lease with a renter for a term of at least 7 months and for
850	which the dwelling is insured by the corporation for $200,000 or
851	less;
852	c.  An owner-occupied mobile home or manufactured home, as
853	defined in s. 320.01, which is permanently affixed to real
854	property, is owned by a Florida resident, and has been granted a
855	homestead exemption under chapter 196 or, if the owner does not
856	own the real property, the owner certifies that the mobile home
857	or manufactured home is his or her principal place of residence;
858	d.  Tenant's coverage;
859	e.  Commercial lines residential property; or
860	f.  Any county, district, or municipal hospital; a hospital
861	licensed by any not-for-profit corporation qualified under s.
862	501(c)(3) of the United States Internal Revenue Code; or a
863	continuing care retirement community that is certified under
864	chapter 651 and that receives an exemption from ad valorem taxes
865	under chapter 196.
866	4.  For the purposes of this subsection, the term
867	"nonhomestead property" means property that is not homestead
868	property.
869	5.  Effective July 1, 2008, a personal lines residential
870	structure that has a dwelling replacement cost of $1 million or
871	more, or a single condominium unit that has a combined dwelling
872	and content replacement cost of $1 million or more is not
873	eligible for coverage by the corporation. Such dwellings insured
874	by the corporation on June 30, 2008, may continue to be covered
875	by the corporation until the end of the policy term. However,
876	such dwellings that are insured by the corporation and become
877	ineligible for coverage due to the provisions of this
878	subparagraph may reapply and obtain coverage in the high-risk
879	account and be considered "nonhomestead property" if the
880	property owner provides the corporation with a sworn affidavit
881	from one or more insurance agents, on a form provided by the
882	corporation, stating that the agents have made their best
883	efforts to obtain coverage and that the property has been
884	rejected for coverage by at least one authorized insurer and at
885	least three surplus lines insurers. If such conditions are met,
886	the dwelling may be insured by the corporation for up to 3
887	years, after which time the dwelling is ineligible for coverage.
888	The office shall approve the method used by the corporation for
889	valuing the dwelling replacement cost for the purposes of this
890	subparagraph. If a policyholder is insured by the corporation
891	prior to being determined to be ineligible pursuant to this
892	subparagraph and such policyholder files a lawsuit challenging
893	the determination, the policyholder may remain insured by the
894	corporation until the conclusion of the litigation.
895	6.  For properties constructed on or after January 1, 2009,
896	the corporation may not insure any property located within 2,500
897	feet landward of the coastal construction control line created
898	pursuant to s. 161.053 unless the property meets the
899	requirements of the code-plus building standards developed by
900	the Florida Building Commission.
901	7.  It is the intent of the Legislature that policyholders,
902	applicants, and agents of the corporation receive service and
903	treatment of the highest possible level but never less than that
904	generally provided in the voluntary market. It also is intended
905	that the corporation be held to service standards no less than
906	those applied to insurers in the voluntary market by the office
907	with respect to responsiveness, timeliness, customer courtesy,
908	and overall dealings with policyholders, applicants, or agents
909	of the corporation.
910	(b)1.  All insurers authorized to write one or more subject
911	lines of business in this state are subject to assessment by the
912	corporation and, for the purposes of this subsection, are
913	referred to collectively as "assessable insurers." Insurers
914	writing one or more subject lines of business in this state
915	pursuant to part VIII of chapter 626 are not assessable
916	insurers, but insureds who procure one or more subject lines of
917	business in this state pursuant to part VIII of chapter 626 are
918	subject to assessment by the corporation and are referred to
919	collectively as "assessable insureds." An authorized insurer's
920	assessment liability shall begin on the first day of the
921	calendar year following the year in which the insurer was issued
922	a certificate of authority to transact insurance for subject
923	lines of business in this state and shall terminate 1 year after
924	the end of the first calendar year during which the insurer no
925	longer holds a certificate of authority to transact insurance
926	for subject lines of business in this state.
927	2.a.  All revenues, assets, liabilities, losses, and
928	expenses of the corporation shall be divided into three separate
929	accounts as follows:
930	(I)  A personal lines account for personal residential
931	policies issued by the corporation or issued by the Residential
932	Property and Casualty Joint Underwriting Association and renewed
933	by the corporation that provide comprehensive, multiperil
934	coverage on risks that are not located in areas eligible for
935	coverage in the Florida Windstorm Underwriting Association as
936	those areas were defined on January 1, 2002, and for such
937	policies that do not provide coverage for the peril of wind on
938	risks that are located in such areas;
939	(II)  A commercial lines account for commercial residential
940	and commercial nonresidential policies issued by the corporation
941	or issued by the Residential Property and Casualty Joint
942	Underwriting Association and renewed by the corporation that
943	provide coverage for basic property perils on risks that are not
944	located in areas eligible for coverage in the Florida Windstorm
945	Underwriting Association as those areas were defined on January
946	1, 2002, and for such policies that do not provide coverage for
947	the peril of wind on risks that are located in such areas; and
948	(III)  A high-risk account for personal residential
949	policies and commercial residential and commercial
950	nonresidential property policies issued by the corporation or
951	transferred to the corporation that provide coverage for the
952	peril of wind on risks that are located in areas eligible for
953	coverage in the Florida Windstorm Underwriting Association as
954	those areas were defined on January 1, 2002. Subject to the
955	approval of a business plan by the Financial Services Commission
956	and Legislative Budget Commission as provided in this sub-sub-
957	subparagraph, but no earlier than March 31, 2007, the
958	corporation may offer policies that provide multiperil coverage
959	and the corporation shall continue to offer policies that
960	provide coverage only for the peril of wind for risks located in
961	areas eligible for coverage in the high-risk account. In issuing
962	multiperil coverage, the corporation may use its approved policy
963	forms and rates for the personal lines account. An applicant or
964	insured who is eligible to purchase a multiperil policy from the
965	corporation may purchase a multiperil policy from an authorized
966	insurer without prejudice to the applicant's or insured's
967	eligibility to prospectively purchase a policy that provides
968	coverage only for the peril of wind from the corporation. An
969	applicant or insured who is eligible for a corporation policy
970	that provides coverage only for the peril of wind may elect to
971	purchase or retain such policy and also purchase or retain
972	coverage excluding wind from an authorized insurer without
973	prejudice to the applicant's or insured's eligibility to
974	prospectively purchase a policy that provides multiperil
975	coverage from the corporation. It is the goal of the Legislature
976	that there would be an overall average savings of 10 percent or
977	more for a policyholder who currently has a wind-only policy
978	with the corporation, and an ex-wind policy with a voluntary
979	insurer or the corporation, and who then obtains a multiperil
980	policy from the corporation. It is the intent of the Legislature
981	that the offer of multiperil coverage in the high-risk account
982	be made and implemented in a manner that does not adversely
983	affect the tax-exempt status of the corporation or
984	creditworthiness of or security for currently outstanding
985	financing obligations or credit facilities of the high-risk
986	account, the personal lines account, or the commercial lines
987	account. By March 1, 2007, the corporation shall prepare and
988	submit for approval by the Financial Services Commission and
989	Legislative Budget Commission a report detailing the
990	corporation's business plan for issuing multiperil coverage in
991	the high-risk account. The business plan shall be approved or
992	disapproved within 30 days after receipt, as submitted or
993	modified and resubmitted by the corporation. The business plan
994	must include: the impact of such multiperil coverage on the
995	corporation's financial resources, the impact of such multiperil
996	coverage on the corporation's tax-exempt status, the manner in
997	which the corporation plans to implement the processing of
998	applications and policy forms for new and existing
999	policyholders, the impact of such multiperil coverage on the
1000	corporation's ability to deliver customer service at the high
1001	level required by this subsection, the ability of the
1002	corporation to process claims, the ability of the corporation to
1003	quote and issue policies, the impact of such multiperil coverage
1004	on the corporation's agents, the impact of such multiperil
1005	coverage on the corporation's existing policyholders, and the
1006	impact of such multiperil coverage on rates and premium. The
1007	high-risk account must also include quota share primary
1008	insurance under subparagraph (c)2. The area eligible for
1009	coverage under the high-risk account also includes the area
1010	within Port Canaveral, which is bordered on the south by the
1011	City of Cape Canaveral, bordered on the west by the Banana
1012	River, and bordered on the north by Federal Government property.
1013	b.  The three separate accounts must be maintained as long
1014	as financing obligations entered into by the Florida Windstorm
1015	Underwriting Association or Residential Property and Casualty
1016	Joint Underwriting Association are outstanding, in accordance
1017	with the terms of the corresponding financing documents. When
1018	the financing obligations are no longer outstanding, in
1019	accordance with the terms of the corresponding financing
1020	documents, the corporation may use a single account for all
1021	revenues, assets, liabilities, losses, and expenses of the
1022	corporation. Consistent with the requirement of this
1023	subparagraph and prudent investment policies that minimize the
1024	cost of carrying debt, the board shall exercise its best efforts
1025	to retire existing debt or to obtain approval of necessary
1026	parties to amend the terms of existing debt, so as to structure
1027	the most efficient plan to consolidate the three separate
1028	accounts into a single account. By February 1, 2007, the board
1029	shall submit a report to the Financial Services Commission, the
1030	President of the Senate, and the Speaker of the House of
1031	Representatives which includes an analysis of consolidating the
1032	accounts, the actions the board has taken to minimize the cost
1033	of carrying debt, and its recommendations for executing the most
1034	efficient plan.
1035	c.  Creditors of the Residential Property and Casualty
1036	Joint Underwriting Association shall have a claim against, and
1037	recourse to, the accounts referred to in sub-sub-subparagraphs
1038	a.(I) and (II) and shall have no claim against, or recourse to,
1039	the account referred to in sub-sub-subparagraph a.(III).
1040	Creditors of the Florida Windstorm Underwriting Association
1041	shall have a claim against, and recourse to, the account
1042	referred to in sub-sub-subparagraph a.(III) and shall have no
1043	claim against, or recourse to, the accounts referred to in sub-
1044	sub-subparagraphs a.(I) and (II).
1045	d.  Revenues, assets, liabilities, losses, and expenses not
1046	attributable to particular accounts shall be prorated among the
1047	accounts.
1048	e.  The Legislature finds that the revenues of the
1049	corporation are revenues that are necessary to meet the
1050	requirements set forth in documents authorizing the issuance of
1051	bonds under this subsection.
1052	f.  No part of the income of the corporation may inure to
1053	the benefit of any private person.
1054	3.  With respect to a deficit in an account:
1055	a.  When the deficit incurred in a particular calendar year
1056	is not greater than 10 percent of the aggregate statewide direct
1057	written premium for the subject lines of business for the prior
1058	calendar year, the entire deficit shall be recovered through
1059	regular assessments of assessable insurers under paragraph (p)
1060	and assessable insureds.
1061	b.  When the deficit incurred in a particular calendar year
1062	exceeds 10 percent of the aggregate statewide direct written
1063	premium for the subject lines of business for the prior calendar
1064	year, the corporation shall levy regular assessments on
1065	assessable insurers under paragraph (p) and on assessable
1066	insureds in an amount equal to the greater of 10 percent of the
1067	deficit or 10 percent of the aggregate statewide direct written
1068	premium for the subject lines of business for the prior calendar
1069	year. Any remaining deficit shall be recovered through emergency
1070	assessments under sub-subparagraph d.
1071	c.  Each assessable insurer's share of the amount being
1072	assessed under sub-subparagraph a. or sub-subparagraph b. shall
1073	be in the proportion that the assessable insurer's direct
1074	written premium for the subject lines of business for the year
1075	preceding the assessment bears to the aggregate statewide direct
1076	written premium for the subject lines of business for that year.
1077	The assessment percentage applicable to each assessable insured
1078	is the ratio of the amount being assessed under sub-subparagraph
1079	a. or sub-subparagraph b. to the aggregate statewide direct
1080	written premium for the subject lines of business for the prior
1081	year. Assessments levied by the corporation on assessable
1082	insurers under sub-subparagraphs a. and b. shall be paid as
1083	required by the corporation's plan of operation and paragraph
1084	(p). Notwithstanding any other provision of this subsection, the
1085	aggregate amount of a regular assessment for a deficit incurred
1086	in a particular calendar year shall be reduced by the estimated
1087	amount to be received by the corporation from the Citizens
1088	policyholder surcharge under subparagraph (c)10.11. and the
1089	amount collected or estimated to be collected from the
1090	assessment on Citizens policyholders pursuant to sub-
1091	subparagraph i. Assessments levied by the corporation on
1092	assessable insureds under sub-subparagraphs a. and b. shall be
1093	collected by the surplus lines agent at the time the surplus
1094	lines agent collects the surplus lines tax required by s.
1095	626.932 and shall be paid to the Florida Surplus Lines Service
1096	Office at the time the surplus lines agent pays the surplus
1097	lines tax to the Florida Surplus Lines Service Office. Upon
1098	receipt of regular assessments from surplus lines agents, the
1099	Florida Surplus Lines Service Office shall transfer the
1100	assessments directly to the corporation as determined by the
1101	corporation.
1102	d.  Upon a determination by the board of governors that a
1103	deficit in an account exceeds the amount that will be recovered
1104	through regular assessments under sub-subparagraph a. or sub-
1105	subparagraph b., the board shall levy, after verification by the
1106	office, emergency assessments, for as many years as necessary to
1107	cover the deficits, to be collected by assessable insurers and
1108	the corporation and collected from assessable insureds upon
1109	issuance or renewal of policies for subject lines of business,
1110	excluding National Flood Insurance policies. The amount of the
1111	emergency assessment collected in a particular year shall be a
1112	uniform percentage of that year's direct written premium for
1113	subject lines of business and all accounts of the corporation,
1114	excluding National Flood Insurance Program policy premiums, as
1115	annually determined by the board and verified by the office. The
1116	office shall verify the arithmetic calculations involved in the
1117	board's determination within 30 days after receipt of the
1118	information on which the determination was based.
1119	Notwithstanding any other provision of law, the corporation and
1120	each assessable insurer that writes subject lines of business
1121	shall collect emergency assessments from its policyholders
1122	without such obligation being affected by any credit,
1123	limitation, exemption, or deferment. Emergency assessments
1124	levied by the corporation on assessable insureds shall be
1125	collected by the surplus lines agent at the time the surplus
1126	lines agent collects the surplus lines tax required by s.
1127	626.932 and shall be paid to the Florida Surplus Lines Service
1128	Office at the time the surplus lines agent pays the surplus
1129	lines tax to the Florida Surplus Lines Service Office. The
1130	emergency assessments so collected shall be transferred directly
1131	to the corporation on a periodic basis as determined by the
1132	corporation and shall be held by the corporation solely in the
1133	applicable account. The aggregate amount of emergency
1134	assessments levied for an account under this sub-subparagraph in
1135	any calendar year may not exceed the greater of 10 percent of
1136	the amount needed to cover the original deficit, plus interest,
1137	fees, commissions, required reserves, and other costs associated
1138	with financing of the original deficit, or 10 percent of the
1139	aggregate statewide direct written premium for subject lines of
1140	business and for all accounts of the corporation for the prior
1141	year, plus interest, fees, commissions, required reserves, and
1142	other costs associated with financing the original deficit.
1143	e.  The corporation may pledge the proceeds of assessments,
1144	projected recoveries from the Florida Hurricane Catastrophe
1145	Fund, other insurance and reinsurance recoverables, policyholder
1146	surcharges and other surcharges, and other funds available to
1147	the corporation as the source of revenue for and to secure bonds
1148	issued under paragraph (p), bonds or other indebtedness issued
1149	under subparagraph (c)3., or lines of credit or other financing
1150	mechanisms issued or created under this subsection, or to retire
1151	any other debt incurred as a result of deficits or events giving
1152	rise to deficits, or in any other way that the board determines
1153	will efficiently recover such deficits. The purpose of the lines
1154	of credit or other financing mechanisms is to provide additional
1155	resources to assist the corporation in covering claims and
1156	expenses attributable to a catastrophe. As used in this
1157	subsection, the term "assessments" includes regular assessments
1158	under sub-subparagraph a., sub-subparagraph b., or subparagraph
1159	(p)1. and emergency assessments under sub-subparagraph d.
1160	Emergency assessments collected under sub-subparagraph d. are
1161	not part of an insurer's rates, are not premium, and are not
1162	subject to premium tax, fees, or commissions; however, failure
1163	to pay the emergency assessment shall be treated as failure to
1164	pay premium. The emergency assessments under sub-subparagraph d.
1165	shall continue as long as any bonds issued or other indebtedness
1166	incurred with respect to a deficit for which the assessment was
1167	imposed remain outstanding, unless adequate provision has been
1168	made for the payment of such bonds or other indebtedness
1169	pursuant to the documents governing such bonds or other
1170	indebtedness.
1171	f.  As used in this subsection for purposes of any deficit
1172	incurred on or after January 25, 2007, the term "subject lines
1173	of business" means insurance written by assessable insurers or
1174	procured by assessable insureds for all property and casualty
1175	lines of business in this state, but not including workers'
1176	compensation or medical malpractice. As used in the sub-
1177	subparagraph, the term "property and casualty lines of business"
1178	includes all lines of business identified on Form 2, Exhibit of
1179	Premiums and Losses, in the annual statement required of
1180	authorized insurers by s. 624.424 and any rule adopted under
1181	this section, except for those lines identified as accident and
1182	health insurance and except for policies written under the
1183	National Flood Insurance Program or the Federal Crop Insurance
1184	Program. For purposes of this sub-subparagraph, the term
1185	"workers' compensation" includes both workers' compensation
1186	insurance and excess workers' compensation insurance.
1187	g.  The Florida Surplus Lines Service Office shall
1188	determine annually the aggregate statewide written premium in
1189	subject lines of business procured by assessable insureds and
1190	shall report that information to the corporation in a form and
1191	at a time the corporation specifies to ensure that the
1192	corporation can meet the requirements of this subsection and the
1193	corporation's financing obligations.
1194	h.  The Florida Surplus Lines Service Office shall verify
1195	the proper application by surplus lines agents of assessment
1196	percentages for regular assessments and emergency assessments
1197	levied under this subparagraph on assessable insureds and shall
1198	assist the corporation in ensuring the accurate, timely
1199	collection and payment of assessments by surplus lines agents as
1200	required by the corporation.
1201	i.  If a deficit is incurred in any account in 2008 or
1202	thereafter, the board of governors shall levy an immediate
1203	assessment against the premium of each nonhomestead property
1204	policyholder in all accounts of the corporation, as a uniform
1205	percentage of the premium of the policy of up to 10 percent of
1206	such premium, which funds shall be used to offset the deficit.
1207	If this assessment is insufficient to eliminate the deficit, the
1208	board of governors shall levy an additional assessment against
1209	all policyholders of the corporation, which shall be collected
1210	at the time of issuance or renewal of a policy, as a uniform
1211	percentage of the premium for the policy of up to 10 percent of
1212	such premium, which funds shall be used to further offset the
1213	deficit.
1214	j.  The board of governors shall maintain separate
1215	accounting records that consolidate data for nonhomestead
1216	properties, including, but not limited to, number of policies,
1217	insured values, premiums written, and losses. The board of
1218	governors shall annually report to the office and the
1219	Legislature a summary of such data.
1220	(c)  The plan of operation of the corporation:
1221	1.  Must provide for adoption of residential property and
1222	casualty insurance policy forms and commercial residential and
1223	nonresidential property insurance forms, which forms must be
1224	approved by the office prior to use. The corporation shall adopt
1225	the following policy forms:
1226	a.  Standard personal lines policy forms that are
1227	comprehensive multiperil policies providing full coverage of a
1228	residential property equivalent to the coverage provided in the
1229	private insurance market under an HO-3, HO-4, or HO-6 policy.
1230	b.  Basic personal lines policy forms that are policies
1231	similar to an HO-8 policy or a dwelling fire policy that provide
1232	coverage meeting the requirements of the secondary mortgage
1233	market, but which coverage is more limited than the coverage
1234	under a standard policy.
1235	c.  Commercial lines residential and nonresidential policy
1236	forms that are generally similar to the basic perils of full
1237	coverage obtainable for commercial residential structures and
1238	commercial nonresidential structures in the admitted voluntary
1239	market.
1240	d.  Personal lines and commercial lines residential
1241	property insurance forms that cover the peril of wind only. The
1242	forms are applicable only to residential properties located in
1243	areas eligible for coverage under the high-risk account referred
1244	to in sub-subparagraph (b)2.a.
1245	e.  Commercial lines nonresidential property insurance
1246	forms that cover the peril of wind only. The forms are
1247	applicable only to nonresidential properties located in areas
1248	eligible for coverage under the high-risk account referred to in
1249	sub-subparagraph (b)2.a.
1250	f.  The corporation may adopt variations of the policy
1251	forms listed in sub-subparagraphs a.-e. that contain more
1252	restrictive coverage.
1253	2.a.  Must provide that the corporation adopt a program in
1254	which the corporation and authorized insurers enter into quota
1255	share primary insurance agreements for hurricane coverage, as
1256	defined in s. 627.4025(2)(a), for eligible risks, and adopt
1257	property insurance forms for eligible risks which cover the
1258	peril of wind only. As used in this subsection, the term:
1259	(I)  "Quota share primary insurance" means an arrangement
1260	in which the primary hurricane coverage of an eligible risk is
1261	provided in specified percentages by the corporation and an
1262	authorized insurer. The corporation and authorized insurer are
1263	each solely responsible for a specified percentage of hurricane
1264	coverage of an eligible risk as set forth in a quota share
1265	primary insurance agreement between the corporation and an
1266	authorized insurer and the insurance contract. The
1267	responsibility of the corporation or authorized insurer to pay
1268	its specified percentage of hurricane losses of an eligible
1269	risk, as set forth in the quota share primary insurance
1270	agreement, may not be altered by the inability of the other
1271	party to the agreement to pay its specified percentage of
1272	hurricane losses. Eligible risks that are provided hurricane
1273	coverage through a quota share primary insurance arrangement
1274	must be provided policy forms that set forth the obligations of
1275	the corporation and authorized insurer under the arrangement,
1276	clearly specify the percentages of quota share primary insurance
1277	provided by the corporation and authorized insurer, and
1278	conspicuously and clearly state that neither the authorized
1279	insurer nor the corporation may be held responsible beyond its
1280	specified percentage of coverage of hurricane losses.
1281	(II)  "Eligible risks" means personal lines residential and
1282	commercial lines residential risks that meet the underwriting
1283	criteria of the corporation and are located in areas that were
1284	eligible for coverage by the Florida Windstorm Underwriting
1285	Association on January 1, 2002.
1286	b.  The corporation may enter into quota share primary
1287	insurance agreements with authorized insurers at corporation
1288	coverage levels of 90 percent and 50 percent.
1289	c.  If the corporation determines that additional coverage
1290	levels are necessary to maximize participation in quota share
1291	primary insurance agreements by authorized insurers, the
1292	corporation may establish additional coverage levels. However,
1293	the corporation's quota share primary insurance coverage level
1294	may not exceed 90 percent.
1295	d.  Any quota share primary insurance agreement entered
1296	into between an authorized insurer and the corporation must
1297	provide for a uniform specified percentage of coverage of
1298	hurricane losses, by county or territory as set forth by the
1299	corporation board, for all eligible risks of the authorized
1300	insurer covered under the quota share primary insurance
1301	agreement.
1302	e.  Any quota share primary insurance agreement entered
1303	into between an authorized insurer and the corporation is
1304	subject to review and approval by the office. However, such
1305	agreement shall be authorized only as to insurance contracts
1306	entered into between an authorized insurer and an insured who is
1307	already insured by the corporation for wind coverage.
1308	f.  For all eligible risks covered under quota share
1309	primary insurance agreements, the exposure and coverage levels
1310	for both the corporation and authorized insurers shall be
1311	reported by the corporation to the Florida Hurricane Catastrophe
1312	Fund. For all policies of eligible risks covered under quota
1313	share primary insurance agreements, the corporation and the
1314	authorized insurer shall maintain complete and accurate records
1315	for the purpose of exposure and loss reimbursement audits as
1316	required by Florida Hurricane Catastrophe Fund rules. The
1317	corporation and the authorized insurer shall each maintain
1318	duplicate copies of policy declaration pages and supporting
1319	claims documents.
1320	g.  The corporation board shall establish in its plan of
1321	operation standards for quota share agreements which ensure that
1322	there is no discriminatory application among insurers as to the
1323	terms of quota share agreements, pricing of quota share
1324	agreements, incentive provisions if any, and consideration paid
1325	for servicing policies or adjusting claims.
1326	h.  The quota share primary insurance agreement between the
1327	corporation and an authorized insurer must set forth the
1328	specific terms under which coverage is provided, including, but
1329	not limited to, the sale and servicing of policies issued under
1330	the agreement by the insurance agent of the authorized insurer
1331	producing the business, the reporting of information concerning
1332	eligible risks, the payment of premium to the corporation, and
1333	arrangements for the adjustment and payment of hurricane claims
1334	incurred on eligible risks by the claims adjuster and personnel
1335	of the authorized insurer. Entering into a quota sharing
1336	insurance agreement between the corporation and an authorized
1337	insurer shall be voluntary and at the discretion of the
1338	authorized insurer.
1339	3.  May provide that the corporation may employ or
1340	otherwise contract with individuals or other entities to provide
1341	administrative or professional services that may be appropriate
1342	to effectuate the plan. The corporation shall have the power to
1343	borrow funds, by issuing bonds or by incurring other
1344	indebtedness, and shall have other powers reasonably necessary
1345	to effectuate the requirements of this subsection, including,
1346	without limitation, the power to issue bonds and incur other
1347	indebtedness in order to refinance outstanding bonds or other
1348	indebtedness. The corporation may, but is not required to, seek
1349	judicial validation of its bonds or other indebtedness under
1350	chapter 75. The corporation may issue bonds or incur other
1351	indebtedness, or have bonds issued on its behalf by a unit of
1352	local government pursuant to subparagraph (g)2., in the absence
1353	of a hurricane or other weather-related event, upon a
1354	determination by the corporation, subject to approval by the
1355	office, that such action would enable it to efficiently meet the
1356	financial obligations of the corporation and that such
1357	financings are reasonably necessary to effectuate the
1358	requirements of this subsection. The corporation is authorized
1359	to take all actions needed to facilitate tax-free status for any
1360	such bonds or indebtedness, including formation of trusts or
1361	other affiliated entities. The corporation shall have the
1362	authority to pledge assessments, projected recoveries from the
1363	Florida Hurricane Catastrophe Fund, other reinsurance
1364	recoverables, market equalization and other surcharges, and
1365	other funds available to the corporation as security for bonds
1366	or other indebtedness. In recognition of s. 10, Art. I of the
1367	State Constitution, prohibiting the impairment of obligations of
1368	contracts, it is the intent of the Legislature that no action be
1369	taken whose purpose is to impair any bond indenture or financing
1370	agreement or any revenue source committed by contract to such
1371	bond or other indebtedness.
1372	4.a.  Must require that the corporation operate subject to
1373	the supervision and approval of a board of governors consisting
1374	of eight individuals who are residents of this state, from
1375	different geographical areas of this state. The Governor, the
1376	Chief Financial Officer, the President of the Senate, and the
1377	Speaker of the House of Representatives shall each appoint two
1378	members of the board. At least one of the two members appointed
1379	by each appointing officer must have demonstrated expertise in
1380	insurance. The Chief Financial Officer shall designate one of
1381	the appointees as chair. All board members serve at the pleasure
1382	of the appointing officer. All members of the board of governors
1383	are subject to removal at will by the officers who appointed
1384	them. All board members, including the chair, must be appointed
1385	to serve for 3-year terms beginning annually on a date
1386	designated by the plan. Any board vacancy shall be filled for
1387	the unexpired term by the appointing officer. The Chief
1388	Financial Officer shall appoint a technical advisory group to
1389	provide information and advice to the board of governors in
1390	connection with the board's duties under this subsection. The
1391	executive director and senior managers of the corporation shall
1392	be engaged by the board and serve at the pleasure of the board.
1393	Any executive director appointed on or after July 1, 2006, is
1394	subject to confirmation by the Senate. The executive director is
1395	responsible for employing other staff as the corporation may
1396	require, subject to review and concurrence by the board.
1397	b.  The board shall create a Market Accountability Advisory
1398	Committee to assist the corporation in developing awareness of
1399	its rates and its customer and agent service levels in
1400	relationship to the voluntary market insurers writing similar
1401	coverage. The members of the advisory committee shall consist of
1402	the following 11 persons, one of whom must be elected chair by
1403	the members of the committee: four representatives, one
1404	appointed by the Florida Association of Insurance Agents, one by
1405	the Florida Association of Insurance and Financial Advisors, one
1406	by the Professional Insurance Agents of Florida, and one by the
1407	Latin American Association of Insurance Agencies; three
1408	representatives appointed by the insurers with the three highest
1409	voluntary market share of residential property insurance
1410	business in the state; one representative from the Office of
1411	Insurance Regulation; one consumer appointed by the board who is
1412	insured by the corporation at the time of appointment to the
1413	committee; one representative appointed by the Florida
1414	Association of Realtors; and one representative appointed by the
1415	Florida Bankers Association. All members must serve for 3-year
1416	terms and may serve for consecutive terms. The committee shall
1417	report to the corporation at each board meeting on insurance
1418	market issues which may include rates and rate competition with
1419	the voluntary market; service, including policy issuance, claims
1420	processing, and general responsiveness to policyholders,
1421	applicants, and agents; and matters relating to depopulation.
1422	5.  Must provide a procedure for determining the
1423	eligibility of a risk for coverage, as follows:
1424	a.  Subject to the provisions of s. 627.3517, with respect
1425	to personal lines residential risks, if the risk is offered
1426	coverage from an authorized insurer at the insurer's approved
1427	rate under either a standard policy including wind coverage or,
1428	if consistent with the insurer's underwriting rules as filed
1429	with the office, a basic policy including wind coverage, for a
1430	new application to the corporation for coverage, the risk is not
1431	eligible for any policy issued by the corporation unless the
1432	premium for coverage from the authorized insurer is more than 25
1433	percent greater than the premium for comparable coverage from
1434	the corporation. If the risk is not able to obtain any such
1435	offer, the risk is eligible for either a standard policy
1436	including wind coverage or a basic policy including wind
1437	coverage issued by the corporation; however, if the risk could
1438	not be insured under a standard policy including wind coverage
1439	regardless of market conditions, the risk shall be eligible for
1440	a basic policy including wind coverage unless rejected under
1441	subparagraph 8. However, with regard to a policyholder of the
1442	corporation or a policyholder removed from the corporation
1443	through an assumption agreement until the end of the assumption
1444	period, the policyholder remains eligible for coverage from the
1445	corporation regardless of any offer of coverage from an
1446	authorized insurer or surplus lines insurer. The corporation
1447	shall determine the type of policy to be provided on the basis
1448	of objective standards specified in the underwriting manual and
1449	based on generally accepted underwriting practices.
1450	(I)  If the risk accepts an offer of coverage through the
1451	market assistance plan or an offer of coverage through a
1452	mechanism established by the corporation before a policy is
1453	issued to the risk by the corporation or during the first 30
1454	days of coverage by the corporation, and the producing agent who
1455	submitted the application to the plan or to the corporation is
1456	not currently appointed by the insurer, the insurer shall:
1457	(A)  Pay to the producing agent of record of the policy,
1458	for the first year, an amount that is the greater of the
1459	insurer's usual and customary commission for the type of policy
1460	written or a fee equal to the usual and customary commission of
1461	the corporation; or
1462	(B)  Offer to allow the producing agent of record of the
1463	policy to continue servicing the policy for a period of not less
1464	than 1 year and offer to pay the agent the greater of the
1465	insurer's or the corporation's usual and customary commission
1466	for the type of policy written.
1467
1468	If the producing agent is unwilling or unable to accept
1469	appointment, the new insurer shall pay the agent in accordance
1470	with sub-sub-sub-subparagraph (A).
1471	(II)  When the corporation enters into a contractual
1472	agreement for a take-out plan, the producing agent of record of
1473	the corporation policy is entitled to retain any unearned
1474	commission on the policy, and the insurer shall:
1475	(A)  Pay to the producing agent of record of the
1476	corporation policy, for the first year, an amount that is the
1477	greater of the insurer's usual and customary commission for the
1478	type of policy written or a fee equal to the usual and customary
1479	commission of the corporation; or
1480	(B)  Offer to allow the producing agent of record of the
1481	corporation policy to continue servicing the policy for a period
1482	of not less than 1 year and offer to pay the agent the greater
1483	of the insurer's or the corporation's usual and customary
1484	commission for the type of policy written.
1485
1486	If the producing agent is unwilling or unable to accept
1487	appointment, the new insurer shall pay the agent in accordance
1488	with sub-sub-sub-subparagraph (A).
1489	b.  With respect to commercial lines residential risks, for
1490	a new application to the corporation for coverage, if the risk
1491	is offered coverage under a policy including wind coverage from
1492	an authorized insurer at its approved rate, the risk is not
1493	eligible for any policy issued by the corporation unless the
1494	premium for coverage from the authorized insurer is more than 25
1495	percent greater than the premium for comparable coverage from
1496	the corporation. If the risk is not able to obtain any such
1497	offer, the risk is eligible for a policy including wind coverage
1498	issued by the corporation. However, with regard to a
1499	policyholder of the corporation or a policyholder removed from
1500	the corporation through an assumption agreement until the end of
1501	the assumption period, the policyholder remains eligible for
1502	coverage from the corporation regardless of any offer of
1503	coverage from an authorized insurer or surplus lines insurer.
1504	(I)  If the risk accepts an offer of coverage through the
1505	market assistance plan or an offer of coverage through a
1506	mechanism established by the corporation before a policy is
1507	issued to the risk by the corporation or during the first 30
1508	days of coverage by the corporation, and the producing agent who
1509	submitted the application to the plan or the corporation is not
1510	currently appointed by the insurer, the insurer shall:
1511	(A)  Pay to the producing agent of record of the policy,
1512	for the first year, an amount that is the greater of the
1513	insurer's usual and customary commission for the type of policy
1514	written or a fee equal to the usual and customary commission of
1515	the corporation; or
1516	(B)  Offer to allow the producing agent of record of the
1517	policy to continue servicing the policy for a period of not less
1518	than 1 year and offer to pay the agent the greater of the
1519	insurer's or the corporation's usual and customary commission
1520	for the type of policy written.
1521
1522	If the producing agent is unwilling or unable to accept
1523	appointment, the new insurer shall pay the agent in accordance
1524	with sub-sub-sub-subparagraph (A).
1525	(II)  When the corporation enters into a contractual
1526	agreement for a take-out plan, the producing agent of record of
1527	the corporation policy is entitled to retain any unearned
1528	commission on the policy, and the insurer shall:
1529	(A)  Pay to the producing agent of record of the
1530	corporation policy, for the first year, an amount that is the
1531	greater of the insurer's usual and customary commission for the
1532	type of policy written or a fee equal to the usual and customary
1533	commission of the corporation; or
1534	(B)  Offer to allow the producing agent of record of the
1535	corporation policy to continue servicing the policy for a period
1536	of not less than 1 year and offer to pay the agent the greater
1537	of the insurer's or the corporation's usual and customary
1538	commission for the type of policy written.
1539
1540	If the producing agent is unwilling or unable to accept
1541	appointment, the new insurer shall pay the agent in accordance
1542	with sub-sub-sub-subparagraph (A).
1543	c.  For purposes of determining comparable coverage under
1544	sub-subparagraphs a. and b., the comparison shall be based on
1545	those forms and coverages that are reasonably comparable. The
1546	corporation may rely on a determination of comparable coverage
1547	and premium made by the producing agent who submits the
1548	application to the corporation, made in the agent's capacity as
1549	the corporation's agent. A comparison may be made solely of the
1550	premium with respect to the main building or structure only on
1551	the following basis: the same coverage A or other building
1552	limits; the same percentage hurricane deductible that applies on
1553	an annual basis or that applies to each hurricane for commercial
1554	residential property; the same percentage of ordinance and law
1555	coverage, if the same limit is offered by both the corporation
1556	and the authorized insurer; the same mitigation credits, to the
1557	extent the same types of credits are offered both by the
1558	corporation and the authorized insurer; the same method for loss
1559	payment, such as replacement cost or actual cash value, if the
1560	same method is offered both by the corporation and the
1561	authorized insurer in accordance with underwriting rules; and
1562	any other form or coverage that is reasonably comparable as
1563	determined by the board. If an application is submitted to the
1564	corporation for wind-only coverage in the high-risk account, the
1565	premium for the corporation's wind-only policy plus the premium
1566	for the ex-wind policy that is offered by an authorized insurer
1567	to the applicant shall be compared to the premium for multiperil
1568	coverage offered by an authorized insurer, subject to the
1569	standards for comparison specified in this subparagraph. If the
1570	corporation or the applicant requests from the authorized
1571	insurer a breakdown of the premium of the offer by types of
1572	coverage so that a comparison may be made by the corporation or
1573	its agent and the authorized insurer refuses or is unable to
1574	provide such information, the corporation may treat the offer as
1575	not being an offer of coverage from an authorized insurer at the
1576	insurer's approved rate.
1577	6.  Must provide by July 1, 2007, that an application for
1578	coverage for a new policy is subject to a waiting period of 10
1579	days before coverage is effective, during which time the
1580	corporation shall make such application available for review by
1581	general lines agents and authorized property and casualty
1582	insurers. The board shall approve an exception that allows for
1583	coverage to be effective before the end of the 10-day waiting
1584	period, for coverage issued in conjunction with a real estate
1585	closing. The board may approve such other exceptions as the
1586	board determines are necessary to prevent lapses in coverage.
1587	6.7.  Must include rules for classifications of risks and
1588	rates therefor.
1589	7.8.  Must provide that if premium and investment income
1590	for an account attributable to a particular calendar year are in
1591	excess of projected losses and expenses for the account
1592	attributable to that year, such excess shall be held in surplus
1593	in the account. Such surplus shall be available to defray
1594	deficits in that account as to future years and shall be used
1595	for that purpose prior to assessing assessable insurers and
1596	assessable insureds as to any calendar year.
1597	8.9.  Must provide objective criteria and procedures to be
1598	uniformly applied for all applicants in determining whether an
1599	individual risk is so hazardous as to be uninsurable. In making
1600	this determination and in establishing the criteria and
1601	procedures, the following shall be considered:
1602	a.  Whether the likelihood of a loss for the individual
1603	risk is substantially higher than for other risks of the same
1604	class; and
1605	b.  Whether the uncertainty associated with the individual
1606	risk is such that an appropriate premium cannot be determined.
1607
1608	The acceptance or rejection of a risk by the corporation shall
1609	be construed as the private placement of insurance, and the
1610	provisions of chapter 120 shall not apply.
1611	9.10.  Must provide that the corporation shall make its
1612	best efforts to procure catastrophe reinsurance at reasonable
1613	rates, to cover its projected 100-year probable maximum loss as
1614	determined by the board of governors.
1615	10.11.  Must provide that in the event of regular deficit
1616	assessments under sub-subparagraph (b)3.a. or sub-subparagraph
1617	(b)3.b., in the personal lines account, the commercial lines
1618	residential account, or the high-risk account, the corporation
1619	shall levy upon corporation policyholders in its next rate
1620	filing, or by a separate rate filing solely for this purpose, a
1621	Citizens policyholder surcharge arising from a regular
1622	assessment in such account in a percentage equal to the total
1623	amount of such regular assessments divided by the aggregate
1624	statewide direct written premium for subject lines of business
1625	for the prior calendar year. For purposes of calculating the
1626	Citizens policyholder surcharge to be levied under this
1627	subparagraph, the total amount of the regular assessment to
1628	which this surcharge is related shall be determined as set forth
1629	in subparagraph (b)3., without deducting the estimated Citizens
1630	policyholder surcharge. Citizens policyholder surcharges under
1631	this subparagraph are not considered premium and are not subject
1632	to commissions, fees, or premium taxes; however, failure to pay
1633	a market equalization surcharge shall be treated as failure to
1634	pay premium.
1635	11.12.  The policies issued by the corporation must provide
1636	that, if the corporation or the market assistance plan obtains
1637	an offer from an authorized insurer to cover the risk at its
1638	approved rates, the risk is no longer eligible for renewal
1639	through the corporation, except as otherwise provided in this
1640	subsection.
1641	12.13.  Corporation policies and applications must include
1642	a notice that the corporation policy could, under this section,
1643	be replaced with a policy issued by an authorized insurer that
1644	does not provide coverage identical to the coverage provided by
1645	the corporation. The notice shall also specify that acceptance
1646	of corporation coverage creates a conclusive presumption that
1647	the applicant or policyholder is aware of this potential.
1648	13.14.  May establish, subject to approval by the office,
1649	different eligibility requirements and operational procedures
1650	for any line or type of coverage for any specified county or
1651	area if the board determines that such changes to the
1652	eligibility requirements and operational procedures are
1653	justified due to the voluntary market being sufficiently stable
1654	and competitive in such area or for such line or type of
1655	coverage and that consumers who, in good faith, are unable to
1656	obtain insurance through the voluntary market through ordinary
1657	methods would continue to have access to coverage from the
1658	corporation. When coverage is sought in connection with a real
1659	property transfer, such requirements and procedures shall not
1660	provide for an effective date of coverage later than the date of
1661	the closing of the transfer as established by the transferor,
1662	the transferee, and, if applicable, the lender.
1663	14.15.  Must provide that, with respect to the high-risk
1664	account, any assessable insurer with a surplus as to
1665	policyholders of $25 million or less writing 25 percent or more
1666	of its total countrywide property insurance premiums in this
1667	state may petition the office, within the first 90 days of each
1668	calendar year, to qualify as a limited apportionment company. A
1669	regular assessment levied by the corporation on a limited
1670	apportionment company for a deficit incurred by the corporation
1671	for the high-risk account in 2006 or thereafter may be paid to
1672	the corporation on a monthly basis as the assessments are
1673	collected by the limited apportionment company from its insureds
1674	pursuant to s. 627.3512, but the regular assessment must be paid
1675	in full within 12 months after being levied by the corporation.
1676	A limited apportionment company shall collect from its
1677	policyholders any emergency assessment imposed under sub-
1678	subparagraph (b)3.d. The plan shall provide that, if the office
1679	determines that any regular assessment will result in an
1680	impairment of the surplus of a limited apportionment company,
1681	the office may direct that all or part of such assessment be
1682	deferred as provided in subparagraph (g)4. However, there shall
1683	be no limitation or deferment of an emergency assessment to be
1684	collected from policyholders under sub-subparagraph (b)3.d.
1685	15.16.  Must provide that the corporation appoint as its
1686	licensed agents only those agents who also hold an appointment
1687	as defined in s. 626.015(3) with an insurer who at the time of
1688	the agent's initial appointment by the corporation is authorized
1689	to write and is actually writing personal lines residential
1690	property coverage, commercial residential property coverage, or
1691	commercial nonresidential property coverage within the state.
1692	16.17.  Must provide, by July 1, 2007, a premium payment
1693	plan option to its policyholders which allows at a minimum for
1694	quarterly and semiannual payment of premiums. A monthly payment
1695	plan may, but is not required to, be offered.
1696	17.18.  Must provide, effective June 1, 2007, that the
1697	corporation contract with each insurer providing the non-wind
1698	coverage for risks insured by the corporation in the high-risk
1699	account, requiring that the insurer provide claims adjusting
1700	services for the wind coverage provided by the corporation for
1701	such risks. An insurer is required to enter into this contract
1702	as a condition of providing non-wind coverage for a risk that is
1703	insured by the corporation in the high-risk account unless the
1704	board finds, after a hearing, that the insurer is not capable of
1705	providing adjusting services at an acceptable level of quality
1706	to corporation policyholders. The terms and conditions of such
1707	contracts must be substantially the same as the contracts that
1708	the corporation executed with insurers under the "adjust-your-
1709	own" program in 2006, except as may be mutually agreed to by the
1710	parties and except for such changes that the board determines
1711	are necessary to ensure that claims are adjusted appropriately.
1712	The corporation shall provide a process for neutral arbitration
1713	of any dispute between the corporation and the insurer regarding
1714	the terms of the contract. The corporation shall review and
1715	monitor the performance of insurers under these contracts.
1716	18.19.  Must limit coverage on mobile homes or manufactured
1717	homes built prior to 1994 to actual cash value of the dwelling
1718	rather than replacement costs of the dwelling.
1719	19.20.  May provide such limits of coverage as the board
1720	determines, consistent with the requirements of this subsection.
1721	20.21.  May require commercial property to meet specified
1722	hurricane mitigation construction features as a condition of
1723	eligibility for coverage.
1724	(d)1.  All prospective employees for senior management
1725	positions, as defined by the plan of operation, are subject to
1726	background checks as a prerequisite for employment. The office
1727	shall conduct background checks on such prospective employees
1728	pursuant to ss. 624.34, 624.404(3), and 628.261.
1729	2.  On or before July 1 of each year, employees of the
1730	corporation are required to sign and submit a statement
1731	attesting that they do not have a conflict of interest, as
1732	defined in part III of chapter 112. As a condition of
1733	employment, all prospective employees are required to sign and
1734	submit to the corporation a conflict-of-interest statement.
1735	3.  Senior managers and members of the board of governors
1736	are subject to the provisions of part III of chapter 112,
1737	including, but not limited to, the code of ethics and public
1738	disclosure and reporting of financial interests, pursuant to s.
1739	112.3145. For purposes of the filing requirements in s.
1740	112.3145, senior managers and board members are also required to
1741	file such disclosures with the Commission on Ethics and the
1742	Office of Insurance Regulation. The executive director of the
1743	corporation or his or her designee shall notify each newly
1744	appointed and existing appointed member of the board of
1745	governors and senior managers of their duty to comply with the
1746	reporting requirements of s. 112.3145 part III of chapter 112.
1747	At least quarterly, the executive director or his or her
1748	designee shall submit to the Commission on Ethics a list of
1749	names of the senior managers and members of the board of
1750	governors who are subject to the public disclosure requirements
1751	under s. 112.3145.
1752	4.  Notwithstanding s. 112.3148 or s. 112.3149, or any
1753	other provision of law, an employee or board member may not
1754	knowingly accept, directly or indirectly, any gift or
1755	expenditure from a person or entity, or an employee or
1756	representative of such person or entity, that has a contractual
1757	relationship with the corporation or who is under consideration
1758	for a contract. An employee or board member who fails to comply
1759	with subparagraph 3. or this subparagraph is subject to
1760	penalties provided under ss. 112.317 and 112.3173.
1761	5.  Any senior manager of the corporation who is employed
1762	on or after January 1, 2007, regardless of the date of hire, who
1763	subsequently retires or terminates employment is prohibited from
1764	representing another person or entity before the corporation for
1765	2 years after retirement or termination of employment from the
1766	corporation.
1767	6.  Any senior manager employee of the corporation who is
1768	employed on or after January 1, 2007, regardless of the date of
1769	hire, who subsequently retires or terminates employment is
1770	prohibited from having any employment or contractual
1771	relationship for 2 years with an insurer that has entered into
1772	received a take-out bonus agreement with from the corporation.
1773	(m)1.  Rates for coverage provided by the corporation shall
1774	be actuarially sound and subject to the requirements of s.
1775	627.062, except as otherwise provided in this paragraph. The
1776	corporation shall file its recommended rates with the office at
1777	least annually. The corporation shall provide any additional
1778	information regarding the rates which the office requires. The
1779	office shall consider the recommendations of the board and issue
1780	a final order establishing the rates for the corporation within
1781	45 days after the recommended rates are filed. The corporation
1782	may not pursue an administrative challenge or judicial review of
1783	the final order of the office.
1784	2.  In addition to the rates otherwise determined pursuant
1785	to this paragraph, the corporation shall impose and collect an
1786	amount equal to the premium tax provided for in s. 624.509 to
1787	augment the financial resources of the corporation.
1788	3.  After the public hurricane loss-projection model under
1789	s. 627.06281 has been found to be accurate and reliable by the
1790	Florida Commission on Hurricane Loss Projection Methodology,
1791	that model shall serve as the minimum benchmark for determining
1792	the windstorm portion of the corporation's rates. This
1793	subparagraph does not require or allow the corporation to adopt
1794	rates lower than the rates otherwise required or allowed by this
1795	paragraph.
1796	4.  The rate filings for the corporation which were
1797	approved by the office and which took effect January 1, 2007,
1798	are rescinded, except for those rates that were lowered. As soon
1799	as possible, the corporation shall begin using the lower rates
1800	that were in effect on December 31, 2006, and shall provide
1801	refunds to policyholders who have paid higher rates as a result
1802	of that rate filing. The rates in effect on December 31, 2006,
1803	shall remain in effect through at least December 31, 2007, for
1804	the 2007 calendar year except for any rate change that results
1805	in a lower rate. The next rate change that may increase rates
1806	shall be filed with the office by take effect January 1, 2008,
1807	pursuant to a new rate filing recommended by the corporation and
1808	established by the office, subject to the requirements of this
1809	paragraph.
1810	(n)  If coverage in an account is deactivated pursuant to
1811	paragraph (f), coverage through the corporation shall be
1812	reactivated by order of the office only under one of the
1813	following circumstances:
1814	1.  If the market assistance plan receives a minimum of 100
1815	applications for coverage within a 3-month period, or 200
1816	applications for coverage within a 1-year period or less for
1817	residential coverage, unless the market assistance plan provides
1818	a quotation from admitted carriers at their filed rates for at
1819	least 90 percent of such applicants. Any market assistance plan
1820	application that is rejected because an individual risk is so
1821	hazardous as to be uninsurable using the criteria specified in
1822	subparagraph (c)7.8. shall not be included in the minimum
1823	percentage calculation provided herein. In the event that there
1824	is a legal or administrative challenge to a determination by the
1825	office that the conditions of this subparagraph have been met
1826	for eligibility for coverage in the corporation, any eligible
1827	risk may obtain coverage during the pendency of such challenge.
1828	2.  In response to a state of emergency declared by the
1829	Governor under s. 252.36, the office may activate coverage by
1830	order for the period of the emergency upon a finding by the
1831	office that the emergency significantly affects the availability
1832	of residential property insurance.
1833	(v)  Notwithstanding any other provision of law:
1834	1.  The pledge or sale of, the lien upon, and the security
1835	interest in any rights, revenues, or other assets of the
1836	corporation created or purported to be created pursuant to any
1837	financing documents to secure any bonds or other indebtedness of
1838	the corporation shall be and remain valid and enforceable,
1839	notwithstanding the commencement of and during the continuation
1840	of, and after, any rehabilitation, insolvency, liquidation,
1841	bankruptcy, receivership, conservatorship, reorganization, or
1842	similar proceeding against the corporation under the laws of
1843	this state.
1844	2.  No such proceeding shall relieve the corporation of its
1845	obligation, or otherwise affect its ability to perform its
1846	obligation, to continue to collect, or levy and collect,
1847	assessments, market equalization or other surcharges under
1848	subparagraph (c)9.10., or any other rights, revenues, or other
1849	assets of the corporation pledged pursuant to any financing
1850	documents.
1851	3.  Each such pledge or sale of, lien upon, and security
1852	interest in, including the priority of such pledge, lien, or
1853	security interest, any such assessments, market equalization or
1854	other surcharges, or other rights, revenues, or other assets
1855	which are collected, or levied and collected, after the
1856	commencement of and during the pendency of, or after, any such
1857	proceeding shall continue unaffected by such proceeding. As used
1858	in this subsection, the term "financing documents" means any
1859	agreement or agreements, instrument or instruments, or other
1860	document or documents now existing or hereafter created
1861	evidencing any bonds or other indebtedness of the corporation or
1862	pursuant to which any such bonds or other indebtedness has been
1863	or may be issued and pursuant to which any rights, revenues, or
1864	other assets of the corporation are pledged or sold to secure
1865	the repayment of such bonds or indebtedness, together with the
1866	payment of interest on such bonds or such indebtedness, or the
1867	payment of any other obligation or financial product, as defined
1868	in the plan of operation of the corporation related to such
1869	bonds or indebtedness.
1870	4.  Any such pledge or sale of assessments, revenues,
1871	contract rights, or other rights or assets of the corporation
1872	shall constitute a lien and security interest, or sale, as the
1873	case may be, that is immediately effective and attaches to such
1874	assessments, revenues, or contract rights or other rights or
1875	assets, whether or not imposed or collected at the time the
1876	pledge or sale is made. Any such pledge or sale is effective,
1877	valid, binding, and enforceable against the corporation or other
1878	entity making such pledge or sale, and valid and binding against
1879	and superior to any competing claims or obligations owed to any
1880	other person or entity, including policyholders in this state,
1881	asserting rights in any such assessments, revenues, or contract
1882	rights or other rights or assets to the extent set forth in and
1883	in accordance with the terms of the pledge or sale contained in
1884	the applicable financing documents, whether or not any such
1885	person or entity has notice of such pledge or sale and without
1886	the need for any physical delivery, recordation, filing, or
1887	other action.
1888	5.  As long as the corporation has any bonds outstanding,
1889	the corporation may not file a voluntary petition under chapter
1890	9 of the federal Bankruptcy Code or such corresponding chapter
1891	or sections as may be in effect, from time to time, and a public
1892	officer or any organization, entity, or other person may not
1893	authorize the corporation to be or become a debtor under chapter
1894	9 of the federal Bankruptcy Code or such corresponding chapter
1895	or sections as may be in effect, from time to time, during any
1896	such period.
1897	6.  If ordered by a court of competent jurisdiction, the
1898	corporation may assume policies or otherwise provide coverage
1899	for policyholders of an insurer placed in liquidation under
1900	chapter 631, under such forms, rates, terms, and conditions as
1901	the corporation deems appropriate, subject to approval by the
1902	office.
1903	(ff)  The office is authorized to establish a pilot program
1904	for the offering of optional sinkhole coverage in one or more
1905	counties or other territories of the corporation, to implement
1906	the requirements of s. 627.706, as amended by section 30 of
1907	chapter 2007-1, Laws of Florida. Under this pilot program, the
1908	corporation is not required to issue a notice of nonrenewal to
1909	exclude sinkhole coverage upon the renewal of existing policies,
1910	but may instead exclude such coverage using a notice of coverage
1911	change.
1912	Section 11.  Subsection (4) of section 627.3511, Florida
1913	Statutes, is amended to read:
1914	627.3511  Depopulation of Citizens Property Insurance
1915	Corporation.--
1916	(4)  AGENT BONUS.--When the corporation enters into a
1917	contractual agreement for a take-out plan that provides a bonus
1918	to the insurer, the producing agent of record of the corporation
1919	policy is entitled to retain any unearned commission on such
1920	policy, and the insurer shall either:
1921	(a)  Pay to the producing agent of record of the
1922	association policy, for the first year, an amount that is the
1923	greater of the insurer's usual and customary commission for the
1924	type of policy written or a fee equal to the usual and customary
1925	commission of the corporation; or
1926	(b)  Offer to allow the producing agent of record of the
1927	corporation policy to continue servicing the policy for a period
1928	of not less than 1 year and offer to pay the agent the greater
1929	of the insurer's or the corporation's usual and customary
1930	commission for the type of policy written.
1931
1932	If the producing agent is unwilling or unable to accept
1933	appointment, the new insurer shall pay the agent in accordance
1934	with paragraph (a). The requirement of this subsection that the
1935	producing agent of record is entitled to retain the unearned
1936	commission on an association policy does not apply to a policy
1937	for which coverage has been provided in the association for 30
1938	days or less or for which a cancellation notice has been issued
1939	pursuant to s. 627.351(6)(c)10.11. during the first 30 days of
1940	coverage.
1941	Section 12.  Paragraph (a) of subsection (3) of section
1942	627.3515, Florida Statutes, as amended by chapter 2007-1, Laws
1943	of Florida, is amended to read:
1944	627.3515  Market assistance plan; property and casualty
1945	risks.--
1946	(3)(a)  The plan and the corporation shall develop a
1947	business plan and present it to the Financial Services
1948	Commission for approval by September 1, 2007, to provide for the
1949	implementation of an electronic database for the purpose of
1950	confirming eligibility pursuant to s. 627.351(6). The business
1951	plan may provide that authorized insurers or agents of
1952	authorized insurers may submit to the plan or the corporation in
1953	electronic form, as determined by the plan or the corporation,
1954	information determined necessary by the plan or the corporation
1955	to deny coverage to risks ineligible for coverage by the
1956	corporation. Any authorized insurer submitting such information
1957	that results in a risk being denied coverage by the corporation
1958	is required to offer coverage to the risk at its approved rates,
1959	for the coverage and premium quoted, for at least 1 year.
1960	Section 13.  Section 627.3517, Florida Statutes, is amended
1961	to read:
1962	627.3517  Consumer choice.--
1963	(1)  Except as provided in subsection (2), No provision of
1964	s. 627.351, s. 627.3511, or s. 627.3515 shall be construed to
1965	impair the right of any insurance risk apportionment plan
1966	policyholder, upon receipt of any keepout or take-out offer, to
1967	retain his or her current agent, so long as that agent is duly
1968	licensed and appointed by the insurance risk apportionment plan
1969	or otherwise authorized to place business with the insurance
1970	risk apportionment plan. This right shall not be canceled,
1971	suspended, impeded, abridged, or otherwise compromised by any
1972	rule, plan of operation, or depopulation plan, whether through
1973	keepout, take-out, midterm assumption, or any other means, of
1974	any insurance risk apportionment plan or depopulation plan,
1975	including, but not limited to, those described in s. 627.351, s.
1976	627.3511, or s. 627.3515. The commission shall adopt any rules
1977	necessary to cause any insurance risk apportionment plan or
1978	market assistance plan under such sections to demonstrate that
1979	the operations of the plan do not interfere with, promote, or
1980	allow interference with the rights created under this section.
1981	If the policyholder's current agent is unable or unwilling to be
1982	appointed with the insurer making the take-out or keepout offer,
1983	the policyholder shall not be disqualified from participation in
1984	the appropriate insurance risk apportionment plan because of an
1985	offer of coverage in the voluntary market. An offer of full
1986	property insurance coverage by the insurer currently insuring
1987	either the ex-wind or wind-only coverage on the policy to which
1988	the offer applies shall not be considered a take-out or keepout
1989	offer. Any rule, plan of operation, or plan of depopulation,
1990	through keepout, take-out, midterm assumption, or any other
1991	means, of any property insurance risk apportionment plan under
1992	s. 627.351(2) or (6) is subject to ss. 627.351(2)(b) and (6)(c)
1993	and 627.3511(4).
1994	(2)  This section does not apply during the first 10 days
1995	after a new application for coverage has been submitted to
1996	Citizens Property Insurance Corporation under s. 627.351(6),
1997	whether or not coverage is bound during this period.
1998	Section 14.  Subsection (1) of section 627.4035, Florida
1999	Statutes, as amended by chapter 2007-1, Laws of Florida, is
2000	amended to read:
2001	627.4035  Cash payment of premiums; claims.--
2002	(1)  The premiums for insurance contracts issued in this
2003	state or covering risk located in this state shall be paid in
2004	cash consisting of coins, currency, checks, or money orders or
2005	by using a debit card, credit card, automatic electronic funds
2006	transfer, or payroll deduction plan. By July 1, 2007, insurers
2007	issuing personal lines residential and commercial property
2008	policies shall provide a premium payment plan option to their
2009	policyholders which allows for a minimum of quarterly and
2010	semiannual payment of premiums. Insurers may, but are not
2011	required to, offer monthly payment plans. Insurers issuing such
2012	policies must submit their premium payment plan option to the
2013	office for approval before use.
2014	Section 15.  Subsection (7) is added to section 627.4133,
2015	Florida Statutes, to read:
2016	627.4133  Notice of cancellation, nonrenewal, or renewal
2017	premium.--
2018	(7)(a)  Effective August 1, 2007, with respect to any
2019	residential property insurance policy, every notice of renewal
2020	premium must specify:
2021	1.  The dollar amounts recouped for assessments by the
2022	Florida Hurricane Catastrophe Fund, the Citizens Property
2023	Insurance Corporation, and the Florida Insurance Guaranty
2024	Association. The actual names of the entities must appear next
2025	to the dollar amounts.
2026	2.  The dollar amount of any premium increase that is due
2027	to an approved rate increase and the dollar amount that is due
2028	to coverage changes.
2029	(b)  The Financial Services Commission may adopt rules
2030	pursuant to ss. 120.536(1) and 120.54 to implement this
2031	subsection.
2032	Section 16.  Paragraphs (a) and (c) of subsection (3) and
2033	paragraph (d) of subsection (4) of section 627.701, Florida
2034	Statutes, as amended by chapter 2007-1, Laws of Florida, are
2035	amended to read:
2036	627.701  Liability of insureds; coinsurance; deductibles.--
2037	(3)(a)  Except as otherwise provided in this subsection,
2038	prior to issuing a personal lines residential property insurance
2039	policy, the insurer must offer alternative deductible amounts
2040	applicable to hurricane losses equal to $500, 2 percent, 5
2041	percent, and 10 percent of the policy dwelling limits, unless
2042	the specific percentage deductible is less than $500. The
2043	written notice of the offer shall specify the hurricane or wind
2044	deductible to be applied in the event that the applicant or
2045	policyholder fails to affirmatively choose a hurricane
2046	deductible. The insurer must provide such policyholder with
2047	notice of the availability of the deductible amounts specified
2048	in this paragraph in a form approved by the office in
2049	conjunction with each renewal of the policy. The failure to
2050	provide such notice constitutes a violation of this code but
2051	does not affect the coverage provided under the policy.
2052	(c)  With respect to a policy covering a risk with dwelling
2053	limits of at least $100,000, but less than $250,000, the insurer
2054	may, in lieu of offering a policy with a $500 hurricane or wind
2055	deductible as required by paragraph (a), offer a policy that the
2056	insurer guarantees it will not nonrenew for reasons of reducing
2057	hurricane loss for one renewal period and that contains up to a
2058	2 percent hurricane or wind deductible as required by paragraph
2059	(a).
2060	(4)
2061	(d)1.  A personal lines residential property insurance
2062	policy covering a risk valued at less than $500,000 may not have
2063	a hurricane deductible in excess of 10 percent of the policy
2064	dwelling limits, unless the following conditions are met:
2065	a.  The policyholder must personally write and provide to
2066	the insurer the following statement in his or her own
2067	handwriting and sign his or her name, which must also be signed
2068	by every other named insured on the policy, and dated: "I do not
2069	want the insurance on my home to pay for the first (specify
2070	dollar value) of damage from hurricanes. I will pay those costs.
2071	My insurance will not."
2072	b.  If the structure insured by the policy is subject to a
2073	mortgage or lien, the policyholder must provide the insurer with
2074	a written statement from the mortgageholder or lienholder
2075	indicating that the mortgageholder or lienholder approves the
2076	policyholder electing to have the specified deductible.
2077	2.  A deductible subject to the requirements of this
2078	paragraph applies for the term of the policy and for each
2079	renewal thereafter unless the policyholder elects otherwise.
2080	Changes to the deductible percentage may be implemented only as
2081	of the date of renewal.
2082	3.  An insurer shall keep the original copy of the signed
2083	statement required by this paragraph, electronically or
2084	otherwise, and provide a copy to the policyholder providing the
2085	signed statement. A signed statement meeting the requirements of
2086	this paragraph creates a presumption that there was an informed,
2087	knowing election of coverage.
2088	4.  The commission shall adopt rules providing appropriate
2089	alternative methods for providing the statements required by
2090	this section for policyholders who have a handicapping or
2091	disabling condition that prevents them from providing a
2092	handwritten statement.
2093	Section 17.  Subsection (5) of section 627.70131, Florida
2094	Statutes, as amended by chapter 2007-1, Laws of Florida, is
2095	amended to read:
2096	627.70131  Insurer's duty to acknowledge communications
2097	regarding claims; investigation.--
2098	(5)  Within 90 days after an insurer receives notice of a
2099	property insurance claim from a policyholder, the insurer shall
2100	pay or deny such claim unless the failure to pay such claim is
2101	caused by factors beyond the control of the insurer which
2102	reasonably prevent such payment. Within 90 days after an insurer
2103	receives notice of loss of a commercial property insurance claim
2104	from a policyholder, the insurer shall pay or deny such claim
2105	unless the insurer provides specific reasons to the policyholder
2106	why the claim cannot be paid within the 90-day period. Any
2107	overdue payment of a claim shall bear interest at the rate as
2108	set forth in s. 55.03. Interest on an overdue payment for a
2109	claim begins to accrue from the date the insurer receives notice
2110	of the claim. The interest is payable with the payment of the
2111	claim. Interest paid may not be used in future rate filing as an
2112	expense. The provisions of this subsection may not be waived,
2113	voided, or nullified by contract. The exclusive remedy for a
2114	violation of this subsection is a regulatory action under this
2115	code. Failure to comply with this subsection constitutes a
2116	violation of this code.
2117	Section 18.  Subsections (2), (4), and (5) of section
2118	627.712, Florida Statutes, as created by chapter 2007-1, Laws of
2119	Florida, are amended to read:
2120	627.712  Residential hurricane coverage required;
2121	availability of exclusions for windstorm or contents.--
2122	(1)  An insurer issuing a residential property insurance
2123	policy must provide hurricane or windstorm coverage as defined
2124	in s. 627.4025. This subsection does not apply with respect to
2125	risks that are eligible for wind-only coverage from Citizens
2126	Property Insurance Corporation under s. 627.351(6).
2127	(2)  A property An insurer that is subject to subsection
2128	(1) must make available, at the option of the policyholder, an
2129	exclusion of hurricane coverage or windstorm coverage as
2130	provided within the applicable policy. The coverage may be
2131	excluded only if:
2132	(a)1.  When the policyholder is a natural person, the
2133	policyholder personally writes and provides to the insurer the
2134	following statement in his or her own handwriting and signs his
2135	or her name, which must also be signed by every other named
2136	insured on the policy, and dated: "I do not want the insurance
2137	on my (home/mobile home/condominium unit) to pay for damage from
2138	windstorms or hurricanes. I will pay those costs. My insurance
2139	will not."
2140	2.  When the policyholder is other than a natural person,
2141	the policyholder provides to the insurer on the policyholder's
2142	letterhead the following statement that must be signed by the
2143	policyholder's authorized representative and dated: "(Name of
2144	entity) does not want the insurance on its (type of structure)
2145	to pay for damage from windstorms or hurricanes. (Name of
2146	entity) will be responsible for these costs. (Name of entity)'s
2147	insurance will not."
2148	(b)  If the structure insured by the policy is subject to a
2149	mortgage or lien, the policyholder must provide the insurer with
2150	a written statement from the mortgageholder or lienholder
2151	indicating that the mortgageholder or lienholder approves the
2152	policyholder electing to exclude windstorm coverage or hurricane
2153	coverage from his or her or its residential property insurance
2154	policy.
2155	(4)  An insurer shall keep the original copy of a signed
2156	statement required by this section, electronically or otherwise,
2157	and provide a copy to the policyholder providing the signed
2158	statement. A signed statement meeting the requirements of this
2159	section creates a presumption that there was an informed,
2160	knowing rejection of coverage.
2161	(5)  The exclusions authorized by this section apply for
2162	the term of the policy and for each renewal thereafter. Changes
2163	to the exclusions authorized by this section may be implemented
2164	only as of the date of renewal. The exclusions authorized by
2165	this section are valid for the term of the contract and for each
2166	renewal unless the policyholder elects otherwise.
2167	Section 19.  Subsections (4) and (5) of section 627.7277,
2168	Florida Statutes, as amended by chapter 2007-1, Laws of Florida,
2169	are amended to read:
2170	627.7277  Notice of renewal premium.--
2171	(4)  Every notice of renewal premium must specify:
2172	(a)  The dollar amounts recouped for assessments by the
2173	Florida Hurricane Catastrophe Fund, the Citizens Property
2174	Insurance Corporation, and the Florida Insurance Guaranty
2175	Association. The actual names of the entities must appear next
2176	to the dollar amounts.
2177	(b)  The dollar amount of any premium increase that is due
2178	to a rate increase and the dollar amounts that are due to
2179	coverage changes.
2180	(5)  The Financial Services Commission may adopt rules
2181	pursuant to ss. 120.536(1) and 120.54 to implement this section.
2182	Section 20.  Subsection (11) of section 631.52, Florida
2183	Statutes, is amended to read:
2184	631.52  Scope.--This part shall apply to all kinds of
2185	direct insurance, except:
2186	(11)  Self-insurance and any kind of self-insurance fund,
2187	liability pool, or risk management fund;
2188	Section 21.  Paragraph (e) of subsection (3) of section
2189	631.57, Florida Statutes, as amended by chapter 2007-1, Laws of
2190	Florida, is amended to read:
2191	631.57  Powers and duties of the association.--
2192	(3)
2193	(e)1.a.  In addition to assessments otherwise authorized in
2194	paragraph (a) and to the extent necessary to secure the funds
2195	for the account specified in s. 631.55(2)(c) for the direct
2196	payment of covered claims of insurers rendered insolvent by the
2197	effects of a hurricane homeowners' insurers and to pay the
2198	reasonable costs to administer such claims, or to retire
2199	indebtedness, including, without limitation, the principal,
2200	redemption premium, if any, and interest on, and related costs
2201	of issuance of, bonds issued under s. 631.695 and the funding of
2202	any reserves and other payments required under the bond
2203	resolution or trust indenture pursuant to which such bonds have
2204	been issued, the office, upon certification of the board of
2205	directors, shall levy emergency assessments upon insurers
2206	holding a certificate of authority. The emergency assessments
2207	payable under this paragraph by any insurer shall not exceed in
2208	any single year more than 2 percent of that insurer's direct
2209	written premiums, net of refunds, in this state during the
2210	preceding calendar year for the kinds of insurance within the
2211	account specified in s. 631.55(2)(c).
2212	b.  Any emergency assessments authorized under this
2213	paragraph shall be levied by the office upon insurers referred
2214	to in sub-subparagraph a., upon certification as to the need for
2215	such assessments by the board of directors. In the event the
2216	board of directors participates in the issuance of bonds in
2217	accordance with s. 631.695, emergency assessments shall be
2218	levied in each year that bonds issued under s. 631.695 and
2219	secured by such emergency assessments are outstanding, in such
2220	amounts up to such 2-percent limit as required in order to
2221	provide for the full and timely payment of the principal of,
2222	redemption premium, if any, and interest on, and related costs
2223	of issuance of, such bonds. The emergency assessments provided
2224	for in this paragraph are assigned and pledged to the
2225	municipality, county, or legal entity issuing bonds under s.
2226	631.695 for the benefit of the holders of such bonds, in order
2227	to enable such municipality, county, or legal entity to provide
2228	for the payment of the principal of, redemption premium, if any,
2229	and interest on such bonds, the cost of issuance of such bonds,
2230	and the funding of any reserves and other payments required
2231	under the bond resolution or trust indenture pursuant to which
2232	such bonds have been issued, without the necessity of any
2233	further action by the association, the office, or any other
2234	party. To the extent bonds are issued under s. 631.695 and the
2235	association determines to secure such bonds by a pledge of
2236	revenues received from the emergency assessments, such bonds,
2237	upon such pledge of revenues, shall be secured by and payable
2238	from the proceeds of such emergency assessments, and the
2239	proceeds of emergency assessments levied under this paragraph
2240	shall be remitted directly to and administered by the trustee or
2241	custodian appointed for such bonds.
2242	c.  Emergency assessments under this paragraph may be
2243	payable in a single payment or, at the option of the
2244	association, may be payable in 12 monthly installments with the
2245	first installment being due and payable at the end of the month
2246	after an emergency assessment is levied and subsequent
2247	installments being due not later than the end of each succeeding
2248	month.
2249	d.  If emergency assessments are imposed, the report
2250	required by s. 631.695(7) shall include an analysis of the
2251	revenues generated from the emergency assessments imposed under
2252	this paragraph.
2253	e.  If emergency assessments are imposed, the references in
2254	sub-subparagraph (1)(a)3.b. and s. 631.695(2) and (7) to
2255	assessments levied under paragraph (a) shall include emergency
2256	assessments imposed under this paragraph.
2257	2.  In order to ensure that insurers paying emergency
2258	assessments levied under this paragraph continue to charge rates
2259	that are neither inadequate nor excessive, within 90 days after
2260	being notified of such assessments, each insurer that is to be
2261	assessed pursuant to this paragraph shall submit a rate filing
2262	for coverage included within the account specified in s.
2263	631.55(2)(c) and for which rates are required to be filed under
2264	s. 627.062. If the filing reflects a rate change that, as a
2265	percentage, is equal to the difference between the rate of such
2266	assessment and the rate of the previous year's assessment under
2267	this paragraph, the filing shall consist of a certification so
2268	stating and shall be deemed approved when made. Any rate change
2269	of a different percentage shall be subject to the standards and
2270	procedures of s. 627.062.
2271	3.  In the event the board of directors participates in the
2272	issuance of bonds in accordance with s. 631.695, an annual
2273	assessment under this paragraph shall continue while the bonds
2274	issued with respect to which the assessment was imposed are
2275	outstanding, including any bonds the proceeds of which were used
2276	to refund bonds issued pursuant to s. 631.695, unless adequate
2277	provision has been made for the payment of the bonds in the
2278	documents authorizing the issuance of such bonds.
2279	4.  Emergency assessments under this paragraph are not
2280	premium and are not subject to the premium tax, to any fees, or
2281	to any commissions. An insurer is liable for all emergency
2282	assessments that the insurer collects and shall treat the
2283	failure of an insured to pay an emergency assessment as a
2284	failure to pay the premium. An insurer is not liable for
2285	uncollectible emergency assessments.
2286	Section 22.  Paragraphs (g), (h), and (i) of subsection (1)
2287	and subsections (2) and (6) of section 631.695, Florida
2288	Statutes, are amended to read:
2289	631.695  Revenue bond issuance through counties or
2290	municipalities.--
2291	(1)  The Legislature finds:
2292	(g)  To achieve the foregoing purposes, it is proper to
2293	authorize municipalities and counties of this state
2294	substantially affected by the landfall of a hurricane to issue
2295	bonds to assist the Florida Insurance Guaranty Association in
2296	expediting the handling and payment of covered claims of
2297	insolvent insurers.
2298	(h)  In order to avoid the needless and indiscriminate
2299	proliferation, duplication, and fragmentation of such assistance
2300	programs, it is in the best interests of the residents of this
2301	state to authorize municipalities and counties severely affected
2302	by a hurricane to provide for the payment of covered claims
2303	beyond their territorial limits in the implementation of such
2304	programs.
2305	(i)  It is a paramount public purpose for municipalities
2306	and counties substantially affected by the landfall of a
2307	hurricane to be able to issue bonds for the purposes described
2308	in this section. Such issuance shall provide assistance to
2309	residents of those municipalities and counties as well as to
2310	other residents of this state.
2311	(2)  The governing body of any municipality or county, the
2312	residents of which have been substantially affected by a
2313	hurricane, may issue bonds to fund an assistance program in
2314	conjunction with, and with the consent of, the Florida Insurance
2315	Guaranty Association for the purpose of paying claimants' or
2316	policyholders' covered claims, as defined in s. 631.54, arising
2317	through the insolvency of an insurer, which insolvency is
2318	determined by the Florida Insurance Guaranty Association to have
2319	been a result of a hurricane, regardless of whether the
2320	claimants or policyholders are residents of such municipality or
2321	county or the property to which the claim relates is located
2322	within or outside the territorial jurisdiction of the
2323	municipality or county. The power of a municipality or county to
2324	issue bonds, as described in this section, is in addition to any
2325	powers granted by law and may not be abrogated or restricted by
2326	any provisions in such municipality's or county's charter. A
2327	municipality or county issuing bonds for this purpose shall
2328	enter into such contracts with the Florida Insurance Guaranty
2329	Association or any entity acting on behalf of the Florida
2330	Insurance Guaranty Association as are necessary to implement the
2331	assistance program. Any bonds issued by a municipality or county
2332	or a combination thereof under this subsection shall be payable
2333	from and secured by moneys received by or on behalf of the
2334	municipality or county from assessments levied under s.
2335	631.57(3)(a) and assigned and pledged to or on behalf of the
2336	municipality or county for the benefit of the holders of the
2337	bonds in connection with the assistance program. The funds,
2338	credit, property, and taxing power of the state or any
2339	municipality or county shall not be pledged for the payment of
2340	such bonds.
2341	(6)  Two or more municipalities or counties, the residents
2342	of which have been substantially affected by a hurricane, may
2343	create a legal entity pursuant to s. 163.01(7)(g) to exercise
2344	the powers described in this section as well as those powers
2345	granted in s. 163.01(7)(g). References in this section to a
2346	municipality or county includes such legal entity.
2347	Section 23.  (1)  Notwithstanding section 9 of chapter
2348	2007-1, Laws of Florida, the internal design option provided in
2349	s. 1609.1.4.1. of the Florida Building Code shall remain in
2350	effect until June 1, 2007, for a building permit application
2351	made prior to that date.
2352	(2)  This section shall take effect upon this act becoming
2353	a law and shall apply retroactively to January 25, 2007. This
2354	section shall apply to any actions taken on any building permit
2355	affected by section 9 of chapter 2007-1, Laws of Florida,
2356	including any actions, legal or ministerial, pertaining to the
2357	issuance, revocation, or modifications of any building permit
2358	initiated or issued prior to, on, after, or pending as of
2359	January 25, 2007. If the retroactive application of any
2360	provision of this section is held invalid, the invalidity shall
2361	not affect the retroactive application of other provisions of
2362	this section.
2363	Section 24.  Section 624.46226, Florida Statutes, is
2364	created to read:
2365	624.46226  Public housing authorities self-insurance
2366	funds.--Any two or more public housing authorities in the state
2367	as defined in chapter 421 may also create a self-insurance fund
2368	as defined in s. 624.4622 for the purpose of self-insuring real
2369	or personal property of every kind and every interest in such
2370	property against loss or damage from any hazard or cause and
2371	against any loss consequential to such loss or damage, provided
2372	all the provisions of s. 624.4622 are met.
2373	Section 25.  Except as otherwise expressly provided in this
2374	act, this act shall take effect July 1, 2007.

CODING: Words stricken are deletions; words underlined are additions.