HB 1227

1	A bill to be entitled
2	An act relating to surplus lines insurance; amending s.
3	626.931, F.S.; requiring a surplus lines agent to file
4	quarterly on or before a specified time an affidavit
5	stating that all surplus lines insurance transacted during
6	the preceding quarter has been submitted to the Florida
7	Surplus Lines Service Office; amending s. 626.932, F.S.;
8	requiring the premium tax due on a surplus lines policy to
9	be computed on the gross premium under certain
10	circumstances; amending s. 626.9325, F.S.; revising
11	payment dates for the service fee; requiring the service
12	fee on a surplus lines policy to be computed on the gross
13	premium under certain circumstances; creating s. 626.9362,
14	F.S.; authorizing the Department of Financial Services and
15	the Office of Insurance Regulation to enter into a
16	specified type of agreement with other states pursuant to
17	federal law for the collection and allocation of certain
18	nonadmitted insurance taxes; providing terms that may be
19	included in the agreement; requiring the Florida Surplus
20	Lines Service Office to implement an agreement entered
21	into by the department and the Office of Insurance
22	Regulation; providing for application; amending s.
23	626.938, F.S.; requiring certain insureds or insurers
24	engaging in specified insurance transactions with a
25	foreign or alien insurer to compute the premium tax and
26	service fees based on the gross premium under certain
27	circumstances; requiring such insureds or insurers to pay
28	the applicable premium tax to the department and the
29	service fee to the Florida Surplus Lines Service Office on
30	or before a specified time; providing an effective date.
31
32	WHEREAS, the 111th Congress passed the Nonadmitted and
33	Reinsurance Reform Act of 2010 (NRRA), and
34	WHEREAS, the NRRA provides that no state other than the
35	home state of an insured may require any premium tax payment for
36	nonadmitted insurance and defines "home state" as the state in
37	which an insured maintains its principal place of business [15
38	U.S.C. s. 8206], and
39	WHEREAS, as a result of the NRRA, premium tax payments that
40	would otherwise be paid to Florida will be paid to other states,
41	and
42	WHEREAS, the NRRA allows states to enter into a compact or
43	otherwise establish procedures to allocate among the states the
44	premium taxes paid to an insured's home state, and
45	WHEREAS, the National Association of Insurance
46	Commissioners has adopted an agreement for states to use for
47	that purpose, and
48	WHEREAS, state agreements must be entered into before the
49	expiration of a 330-day period that began on June 21, 2010, to
50	prevent the payment of taxes to such other states pursuant to
51	the NRRA [15 U.S.C. s. 8201], NOW, THEREFORE,
52
53	Be It Enacted by the Legislature of the State of Florida:
54
55	Section 1.  Subsection (1) of section 626.931, Florida
56	Statutes, is amended to read:
57	626.931  Agent affidavit and insurer reporting
58	requirements.-
59	(1)  Each surplus lines agent shall on or before the 45th
60	day the end of the month next following each calendar quarter
61	file with the Florida Surplus Lines Service Office an affidavit,
62	on forms as prescribed and furnished by the Florida Surplus
63	Lines Service Office, stating that all surplus lines insurance
64	transacted by him or her during such calendar quarter has been
65	submitted to the Florida Surplus Lines Service Office as
66	required.
67	Section 2.  Subsection (3) of section 626.932, Florida
68	Statutes, is amended to read:
69	626.932  Surplus lines tax.-
70	(3)  If a surplus lines policy covers risks or exposures
71	only partially in this state and the state is the home state as
72	defined in the federal Nonadmitted and Reinsurance Reform Act of
73	2010 (NRRA), the tax payable shall be computed on the gross
74	portion of the premium which is properly allocable to the risks
75	or exposures located in this state.
76	Section 3.  Subsections (2) and (3) of section 626.9325,
77	Florida Statutes, are amended to read:
78	626.9325  Service fee.-
79	(2)(a)  The surplus lines agent shall pay on or before the
80	45th day following each calendar quarter monthly to the Florida
81	Surplus Lines Service Office the fees related to all policies
82	reported during the previous calendar quarter month in
83	accordance with the plan of operation of the Florida Surplus
84	Lines Service Office.
85	(b)  The agent shall pay interest on the amount of any
86	delinquent fees due, at the rate of 9 percent per year,
87	compounded annually, beginning the day the amount becomes
88	delinquent.
89	(3)  If a surplus lines policy covers risks or exposures
90	only partially in this state and the state is the home state as
91	defined in the federal Nonadmitted and Reinsurance Reform Act of
92	2010 (NRRA), the fee payable shall be computed on the gross
93	portion of the premium which is properly allocable to the risks
94	or exposures located in this state.
95	Section 4.  Section 626.9362, Florida Statutes, is created
96	to read:
97	626.9362  Cooperative reciprocal agreement authorized for
98	collection and allocation of certain nonadmitted insurance
99	taxes.-
100	(1)  The Department of Financial Services and the Office of
101	Insurance Regulation may enter into a cooperative reciprocal
102	agreement with another state or group of states for the purpose
103	of, but not limited to, the collection and allocation of
104	nonadmitted insurance taxes for multistate risks pursuant to the
105	federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA)
106	which was incorporated into the Dodd-Frank Wall Street Reform
107	and Consumer Protection Act, Pub. L. No. 111-203, July 21, 2010.
108	(2)  The terms of the agreement may include, but are not
109	limited to, the following:
110	(a)  Creating a clearinghouse for the purpose of
111	facilitating the receipt and disbursement of nonadmitted
112	insurance taxes.
113	(b)  Specifying requirements and time periods for
114	reporting.
115	(c)  Determining methods for the collection and forwarding
116	of nonadmitted insurance taxes to another state.
117	(d)  Specifying a premium tax allocation formula for multi-
118	state risk nonadmitted insurance.
119	(e)  Providing for audits and the exchange of information.
120	(f)  Facilitating the administration of the cooperative
121	reciprocal agreement in a reasonable manner.
122	(3)  The Florida Surplus Lines Service Office must
123	implement any cooperative reciprocal agreement entered into by
124	the Department Of Financial Services and the Office of Insurance
125	Regulation under this section and has the authority to collect
126	the total tax imposed on a multi-state risk nonadmitted
127	insurance premium.
128	(4)  The department and the Office of Insurance Regulation
129	may adopt rules for the administration and enforcement of a
130	cooperative reciprocal agreement entered into with another state
131	or group of states under this section.
132	(5)  Notwithstanding any other provision of law to the
133	contrary, this section and any cooperative reciprocal agreement
134	entered into with another state or group of states under this
135	section control the collection and allocation of nonadmitted
136	insurance taxes for multistate risks.
137	Section 5.  Subsection (3) of section 626.938, Florida
138	Statutes, is amended to read:
139	626.938  Report and tax of independently procured
140	coverages.-
141	(3)  For the general support of the government of this
142	state, there is levied upon the obligation, chose in action, or
143	right represented by the premium charged for such insurance a
144	tax at the rate of 5 percent of the gross amount of such premium
145	and a 0.3 percent service fee pursuant to s. 626.9325. If the
146	policy covers risks or exposures only partially in this state
147	and this state is the home state as defined by the federal
148	Nonadmitted and Reinsurance Reform Act of 2010 (NRRA), the tax
149	and service fee payable shall be computed on the gross premium.
150	The insured shall withhold the amount of the tax and service fee
151	from the amount of premium charged by and otherwise payable to
152	the insurer for such insurance. On or before the 45th day
153	following each calendar quarter Within 30 days after the
154	insurance is procured, continued, or renewed, and simultaneously
155	with the filing of the report provided for in subsection (1)
156	with the Florida Surplus Lines Service Office, the insured shall
157	make payable to the department the amount of the tax and make
158	payable to the Florida Surplus Lines Service Office the amount
159	of the service fee. The insured shall remit the tax and the
160	service fee to the Florida Surplus Lines Service Office. The
161	Florida Surplus Lines Service Office shall forward to the
162	department the taxes, and any interest collected pursuant to
163	subsection (5), within 10 days after receipt.
164	Section 6.  This act shall take effect upon becoming a law.

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