Florida Senate - 2011                        COMMITTEE AMENDMENT
       Bill No. CS for CS for SB 408
                                Barcode 879158                          
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  04/05/2011           .                                

       The Committee on Rules (Smith) recommended the following:
    1         Senate Amendment (with directory and title amendments)
    3         Between lines 1366 and 1367
    4  insert:
    5         (a)1.It is The public purpose of this subsection is to
    6  ensure that there is the existence of an orderly market for
    7  property insurance for residents Floridians and Florida
    8  businesses of this state.
    9         1. The Legislature finds that private insurers are
   10  unwilling or unable to provide affordable property insurance
   11  coverage in this state to the extent sought and needed. The
   12  absence of affordable property insurance threatens the public
   13  health, safety, and welfare and likewise threatens the economic
   14  health of the state. The state therefore has a compelling public
   15  interest and a public purpose to assist in assuring that
   16  property in the state is insured and that it is insured at
   17  affordable rates so as to facilitate the remediation,
   18  reconstruction, and replacement of damaged or destroyed property
   19  in order to reduce or avoid the negative effects otherwise
   20  resulting to the public health, safety, and welfare, to the
   21  economy of the state, and to the revenues of the state and local
   22  governments which are needed to provide for the public welfare.
   23  It is necessary, therefore, to provide affordable property
   24  insurance to applicants who are in good faith entitled to
   25  procure insurance through the voluntary market but are unable to
   26  do so. The Legislature intends, therefore, by this subsection
   27  that affordable property insurance be provided and that it
   28  continue to be provided, as long as necessary, through Citizens
   29  Property Insurance Corporation, a government entity that is an
   30  integral part of the state, and that is not a private insurance
   31  company. To that end, Citizens Property Insurance Corporation
   32  shall strive to increase the availability of affordable property
   33  insurance in this state, while achieving efficiencies and
   34  economies, and while providing service to policyholders,
   35  applicants, and agents which is no less than the quality
   36  generally provided in the voluntary market, for the achievement
   37  of the foregoing public purposes. Because it is essential for
   38  this government entity to have the maximum financial resources
   39  to pay claims following a catastrophic hurricane, it is the
   40  intent of the Legislature that Citizens Property Insurance
   41  Corporation continue to be an integral part of the state and
   42  that the income of the corporation be exempt from federal income
   43  taxation and that interest on the debt obligations issued by the
   44  corporation be exempt from federal income taxation.
   45         2. The Residential Property and Casualty Joint Underwriting
   46  Association originally created by this statute shall be known,
   47  as of July 1, 2002, as the Citizens Property Insurance
   48  Corporation. The corporation shall provide insurance for
   49  residential and commercial property, for applicants who are in
   50  good faith entitled, but, in good faith, are unable, to procure
   51  insurance through the voluntary market. The corporation shall
   52  operate pursuant to a plan of operation approved by order of the
   53  Financial Services Commission. The plan is subject to continuous
   54  review by the commission. The commission may, by order, withdraw
   55  approval of all or part of a plan if the commission determines
   56  that conditions have changed since approval was granted and that
   57  the purposes of the plan require changes in the plan. The
   58  corporation shall continue to operate pursuant to the plan of
   59  operation approved by the Office of Insurance Regulation until
   60  October 1, 2006. For the purposes of this subsection,
   61  residential coverage includes both personal lines residential
   62  coverage, which consists of the type of coverage provided by
   63  homeowner’s, mobile home owner’s, dwelling, tenant’s,
   64  condominium unit owner’s, and similar policies;, and commercial
   65  lines residential coverage, which consists of the type of
   66  coverage provided by condominium association, apartment
   67  building, and similar policies.
   68         3. Effective January 1, 2009, a personal lines residential
   69  structure that has a dwelling replacement cost of $2 million or
   70  more, or a single condominium unit that has a combined dwelling
   71  and contents content replacement cost of $2 million or more is
   72  not eligible for coverage by the corporation. Such dwellings
   73  insured by the corporation on December 31, 2008, may continue to
   74  be covered by the corporation until the end of the policy term.
   75  However, such dwellings that are insured by the corporation and
   76  become ineligible for coverage due to the provisions of this
   77  subparagraph may reapply and obtain coverage if the property
   78  owner provides the corporation with a sworn affidavit from one
   79  or more insurance agents, on a form provided by the corporation,
   80  stating that the agents have made their best efforts to obtain
   81  coverage and that the property has been rejected for coverage by
   82  at least one authorized insurer and at least three surplus lines
   83  insurers. If such conditions are met, the dwelling may be
   84  insured by the corporation for up to 3 years, after which time
   85  the dwelling is ineligible for coverage. The office shall
   86  approve the method used by the corporation for valuing the
   87  dwelling replacement cost for the purposes of this subparagraph.
   88  If a policyholder is insured by the corporation prior to being
   89  determined to be ineligible pursuant to this subparagraph and
   90  such policyholder files a lawsuit challenging the determination,
   91  the policyholder may remain insured by the corporation until the
   92  conclusion of the litigation.
   93         4. It is the intent of the Legislature that policyholders,
   94  applicants, and agents of the corporation receive service and
   95  treatment of the highest possible level but never less than that
   96  generally provided in the voluntary market. It is also is
   97  intended that the corporation be held to service standards no
   98  less than those applied to insurers in the voluntary market by
   99  the office with respect to responsiveness, timeliness, customer
  100  courtesy, and overall dealings with policyholders, applicants,
  101  or agents of the corporation.
  102         5. Effective January 1, 2009, a personal lines residential
  103  structure that is located in the “wind-borne debris region,” as
  104  defined in s. 1609.2, International Building Code (2006), and
  105  that has an insured value on the structure of $750,000 or more
  106  is not eligible for coverage by the corporation unless the
  107  structure has opening protections as required under the Florida
  108  Building Code for a newly constructed residential structure in
  109  that area. A residential structure shall be deemed to comply
  110  with the requirements of this subparagraph if it has shutters or
  111  opening protections on all openings and if such opening
  112  protections complied with the Florida Building Code at the time
  113  they were installed.
  114         6. In recognition of the corporation’s status as a
  115  governmental entity, policies issued by the corporation must
  116  include a provision stating that as a condition of coverage with
  117  the corporation, policyholders may not engage the services of a
  118  public adjuster to represent the policyholder with respect to
  119  any claim filed under a policy issued by the corporation until
  120  after the corporation has tendered an offer with respect to such
  121  claim. For any claim filed under any policy of the corporation,
  122  a public adjuster may not request payment or be paid, on a
  123  contingency basis or based in any way, directly or indirectly,
  124  on a percentage of the claim amount, and may be paid only a
  125  reasonable hourly fee based on the actual hours of work
  126  performed, subject to a maximum of 5 percent of the additional
  127  amount actually paid over the amount that was originally offered
  128  by the corporation for any one claim.
  130  ====== D I R E C T O R Y  C L A U S E  A M E N D M E N T ======
  131         And the directory clause is amended as follows:
  132         Delete line 1362
  133  and insert:
  134         Section 15. Paragraphs (a), (b), (c), (d), (v), and (y) of
  136  ================= T I T L E  A M E N D M E N T ================
  137         And the title is amended as follows:
  138         Delete line 112
  139  and insert:
  140         by the act; amending s. 627.351, F.S.; requiring
  141         policies issued by the corporation to include a
  142         provision that prohibits policyholders from engaging
  143         the services of a public adjuster until after the
  144         corporation has tendered an offer; limiting an
  145         adjuster’s fee for a claim against the corporation;
  146         renaming the