Florida Senate - 2012 COMMITTEE AMENDMENT Bill No. SB 1844 Barcode 425232 LEGISLATIVE ACTION Senate . House Comm: RCS . 02/02/2012 . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Banking and Insurance (Hays) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete everything after the enacting clause 4 and insert: 5 Section 1. Subsection (8) of section 624.402, Florida 6 Statutes, is amended, and subsection (9) is added to that 7 section, to read: 8 624.402 Exceptions, certificate of authority required.—A 9 certificate of authority shall not be required of an insurer 10 with respect to: 11 (8)(a) An insurer domiciled outside the United States 12 covering only persons who, at the time of issuance or renewal, 13 are nonresidents of the United States if: 14 1. The insurer
or any affiliated person as defined in s.15 624.04 under common ownership or control with the insurerdoes 16 not solicit, sell, or accept application for any insurance 17 policy or contract to be delivered or issued for delivery to any 18 person in any state; 19 2. The insurer registers with the office via a letter of 20 notification upon commencing business from this state; 21 3. The insurer provides the following information, in 22 English, to the office annually by March 1: 23 a. The name of the insurer; the country of domicile; the 24 address of the insurer’s principal office and office in this 25 state; the names of the owners of the insurer and their 26 percentage of ownership; the names of the officers and directors 27 of the insurer; the name, e-mail, and telephone number of a 28 contact person for the insurer; and the number of individuals 29 who are employed by the insurer or its affiliates in this state; 30 b. The lines of insurance and types of products offered by 31 the insurer; 32 c. A statement from the applicable regulatory body of the 33 insurer’s domicile certifying that the insurer is licensed or 34 registered for those lines of insurance and types of products in 35 that domicile; and 36 d. A copy of the filings required by the applicable 37 regulatory body of the insurer’s country of domicile in that 38 country’s official language or in English, if available; 39 4. All certificates, policies, or contracts issued in this 40 state showing coverage under the insurer’s policy include the 41 following statement in a contrasting color and at least 10-point 42 type: “The policy providing your coverage and the insurer 43 providing this policy have not been approved by the Florida 44 Office of Insurance Regulation”; and 45 5. If In the eventthe insurer ceases to do business from 46 this state, the insurer will provide written notification to the 47 office within 30 days after cessation. 48 (b) For purposes of this subsection, “nonresident” means a 49 trust or other entity organized and domiciled under the laws of 50 a country other than the United States or a person who resides 51 in and maintains a physical place of domicile in a country other 52 than the United States, which he or she recognizes as and 53 intends to maintain as his or her permanent home. A nonresident 54 does not include an unauthorized immigrant present in the United 55 States. Notwithstanding any other provision oflaw, it is 56 conclusively presumed, for purposes of this subsection, that a 57 person is a resident of the United States if the suchperson 58 has: 59 1. Had his or her principal place of domicile in the United 60 States for 180 days or more in the 365 days before prior to61 issuance or renewal of the policy; 62 2. Registered to vote in any state; 63 3. Made a statement of domicile in any state; or 64 4. Filed for homestead tax exemption on property in any 65 state. 66 (c) Subject to the limitations provided in this subsection, 67 services, including those listed in s. 624.10, may be provided 68 by the insurer or an affiliated person as defined in s. 624.04 69 under common ownership or control with the insurer. 70 (d) An alien insurer transacting insurance in this state 71 without complying with this subsection is shallbe in violation 72 of this chapter and subject to the penalties provided in s. 73 624.15. 74 (9)(a) Life insurance policies or annuity contracts may be 75 solicited, sold, or issued in this state by an insurer domiciled 76 outside the United States, covering only persons who, at the 77 time of issuance are nonresidents of the United States, provided 78 that: 79 1. The insurer is currently an authorized insurer in his or 80 her country of domicile as to the kind or kinds of insurance 81 proposed to be offered and must have been such an insurer for 82 not fewer than the immediately preceding 3 years, or must be the 83 wholly owned subsidiary of such authorized insurer or must be 84 the wholly owned subsidiary of an already eligible authorized 85 insurer as to the kind or kinds of insurance proposed for a 86 period of not fewer than the immediately preceding 3 years. 87 However, the office may waive the 3-year requirement if the 88 insurer has operated successfully for a period of at least the 89 immediately preceding year and has capital and surplus of not 90 less than $25 million. 91 2. Before the office may grant eligibility, the requesting 92 insurer furnishes the office with a duly authenticated copy of 93 its current annual financial statement, in English, and with all 94 monetary values therein expressed in United States dollars, at 95 an exchange rate then-current and shown in the statement, in the 96 case of statements originally made in the currencies of other 97 countries, and with such additional information relative to the 98 insurer as the office may request. 99 3. The insurer has and maintains surplus as to 100 policyholders of not less than $15 million. Any such surplus as 101 to policyholders shall be represented by investments consisting 102 of eligible investments for like funds of like domestic insurers 103 under part II of chapter 625; however, any such surplus as to 104 policyholders may be represented by investments permitted by the 105 domestic regulator of such alien insurance company if such 106 investments are substantially similar in terms of quality, 107 liquidity, and security to eligible investments for like funds 108 of like domestic insurers under part II of chapter 625. 109 4. The insurer has of good reputation as to providing 110 service to its policyholders and the payment of losses and 111 claims. 112 5. To maintain eligibility, the insurer furnishes the 113 office within the time period specified in s. 624.424(1), a duly 114 authenticated copy of its current annual and quarterly financial 115 statements, in English, and with all monetary values therein 116 expressed in United States dollars, at an exchange rate then 117 current and shown in the statement, in the case of statements 118 originally made in the currencies of other countries, and with 119 such additional information relative to the insurer as the 120 office may request. 121 6. An insurer receiving eligibility under this subsection 122 agrees to make its books and records pertaining to its 123 operations in this state available for inspection during normal 124 business hours upon request of the office. 125 7. The insurer notifies the applicant in clear and 126 conspicuous language: 127 a. The date of organization of the insurer. 128 b. The identity of and rating assigned by each recognized 129 insurance company rating organization that has rated the insurer 130 or, if applicable, that the insurer is unrated. 131 c. That the insurer does not hold a certificate of 132 authority issued in this state and that the office does not 133 exercise regulatory oversight over the insurer. 134 d. The identity and address of the regulatory authority 135 exercising oversight of the insurer. This paragraph does not 136 impose upon the office any duty or responsibility to determine 137 the actual financial condition or claims practices of any 138 unauthorized insurer, and the status of eligibility, if granted 139 by the office, indicates only that the insurer appears to be 140 financially sound and to have satisfactory claims practices and 141 that the office has no credible evidence to the contrary. 142 (b) If the office has reason to believe that an insurer 143 issuing policies or contracts pursuant to this subsection is 144 insolvent or is in unsound financial condition, does not make 145 reasonable prompt payment of benefits, or is no longer eligible 146 under the conditions specified in this subsection, the office 147 may conduct an examination or investigation in accordance with 148 s. 624.316, s. 624.3161, or s. 624.320 and, if the findings of 149 the examination or investigation warrant, may withdraw the 150 eligibility of the insurer to issue policies or contracts 151 pursuant to this subsection without having a certificate of 152 authority issued by the office. 153 (c) This subsection does not provide an exception to the 154 agent licensure requirements of chapter 626. A insurer issuing 155 policies or contracts pursuant to this subsection shall appoint 156 the agents that the insurer uses to sell such policies or 157 contracts as provided in chapter 626. 158 (d) An insurer issuing policies or contracts pursuant to 159 this subsection is subject to part IX of chapter 626, Unfair 160 Insurance Trade Practices Act, and the office may take such 161 actions against the insurer for a violation as are provided in 162 that part. 163 (e) Policies and contracts issued pursuant to this 164 subsection are not subject to the premium tax specified in s. 165 624.509. 166 (f) Applications for life insurance coverage offered under 167 this subsection must contain, in contrasting color and not less 168 than 12-point type, the following statement on the same page as 169 the applicant’s signature: 170 171 This policy is primarily governed by the laws of a 172 foreign country. As a result, all of the rating and 173 underwriting laws applicable to policies filed in this 174 state do not apply to this coverage, which may result 175 in your premiums being higher than would be 176 permissible under a Florida-approved policy. A 177 purchase of individual life insurance should be 178 considered carefully, as future medical conditions may 179 make it impossible to qualify for another individual 180 life policy. If the insurer issuing your policy 181 becomes insolvent, this policy is not covered by the 182 Florida Life and Health Insurance Guaranty 183 Association. For information concerning individual 184 life coverage under a Florida-approved policy, consult 185 your agent or the Florida Department of Financial 186 Services. 187 188 (g) All life insurance policies and annuity contracts 189 issued pursuant to this subsection must contain on the first 190 page of the policy or contract, in contrasting color and not 191 less than 10-point type, the following statement: 192 193 The benefits of the policy providing your coverage are 194 governed primarily by the law of a country other than 195 the United States. 196 197 (h) All single-premium life insurance policies and single 198 premium annuity contracts issued to persons who are not 199 residents of the United States and are not nonresidents 200 illegally residing in the United States pursuant to this 201 subsection are subject to chapter 896. 202 (i) For purposes of this subsection, the term “nonresident” 203 means a trust or other entity or person as defined in subsection 204 624.402(8). 205 (j) An alien insurer transacting insurance in this state 206 without complying with this subsection is in violation of this 207 chapter and subject to the penalties provided in s. 624.15, and 208 must also pay the fine required for each violation as prescribed 209 by s. 626.10. 210 Section 2. This act shall take effect upon becoming a law. 211 212 ================= T I T L E A M E N D M E N T ================ 213 And the title is amended as follows: 214 Delete everything before the enacting clause 215 and insert: 216 A bill to be entitled 217 An act relating to alien insurers; amending s. 218 624.402, F.S.; revising a provision exempting alien 219 insurers from the requirement to obtain a certificate 220 of authority; revising the definition of the term 221 “nonresident”; providing that a life insurance policy 222 and annuity contract may be issued by an insurer 223 domiciled outside the United States under certain 224 conditions; specifying the terms and conditions that 225 must be satisfied before an alien insured may issue a 226 policy or contract; authorizing the Office of 227 Insurance Regulation to conduct an examination of an 228 alien insurer if the office has reason to believe that 229 the insurer is insolvent or is in unsound financial 230 condition; providing that an alien insurer issuing 231 policies or contracts in this state is subject to part 232 IX of ch. 626, F.S., relating to unfair insurance 233 trade practices; authorizing the office to enforce 234 part IX of ch. 626, F.S.; providing that policies and 235 contracts issued pursuant to the act are not subject 236 to the premium tax; requiring that an application for 237 a life insurance policy or an annuity contract contain 238 certain specified statements to protect consumers; 239 providing an effective date.