Florida Senate - 2012                                    SB 1844
       
       
       
       By Senator Latvala
       
       
       
       
       16-00583A-12                                          20121844__
    1                        A bill to be entitled                      
    2         An act relating to alien insurers; amending s.
    3         624.402, F.S.; revising a provision exempting alien
    4         insurers from the requirement to obtain a certificate
    5         of authority; providing an exception for the issuance
    6         of life insurance policies and annuity contracts;
    7         specifying that an alien insurer is exempt from having
    8         to obtain a certificate of authority if such insurer
    9         engages only in specified activities relating to the
   10         delivery of insurance policies or annuity contracts to
   11         nonresident policyowners; revising the definition of
   12         the term “nonresident”; providing that a life
   13         insurance policy and annuity contract may be issued by
   14         an insurer domiciled outside the United States under
   15         certain conditions; specifying the terms and
   16         conditions that must be satisfied before an alien
   17         insured may issue a policy or contract; authorizing
   18         the Office of Insurance Regulation to conduct an
   19         examination of an alien insurer if the office has
   20         reason to believe that the insurer is insolvent or is
   21         in unsound financial condition; providing that an
   22         alien insurer issuing policies or contracts in this
   23         state is subject to part IX of ch. 626, F.S., relating
   24         to unfair insurance trade practices; authorizing the
   25         office to enforce part IX of ch. 626, F.S.; providing
   26         that policies and contracts issued pursuant to the act
   27         are not subject to the premium tax; requiring that an
   28         application for a life insurance policy or an annuity
   29         contract contain certain specified statements to
   30         protect consumers; providing an effective date.
   31  
   32  Be It Enacted by the Legislature of the State of Florida:
   33  
   34         Section 1. Subsection (8) of section 624.402, Florida
   35  Statutes, is amended, and subsection (9) is added to that
   36  section, to read:
   37         624.402 Exceptions, certificate of authority required.—A
   38  certificate of authority shall not be required of an insurer
   39  with respect to:
   40         (8)(a) Except as otherwise provided in subsection (9) with
   41  respect to life insurance policies or annuity contracts,
   42  issuance of other policies or contracts by an insurer domiciled
   43  outside the United States covering only persons who, at the time
   44  of issuance or renewal, are nonresidents of the United States
   45  if:
   46         1. The insurer does not solicit, sell, or accept
   47  application for such insurance policy or annuity contract or any
   48  affiliated person as defined in s. 624.04 under common ownership
   49  or control with the insurer does not solicit, sell, or accept
   50  application for any insurance policy or contract to be delivered
   51  or issued for delivery to any person in any state;
   52         2. The insurer registers with the Office of Insurance
   53  Regulation via a letter of notification upon commencing business
   54  from this state;
   55         3. The insurer provides the following information, in
   56  English, to the Office of Insurance Regulation annually by March
   57  1:
   58         a. The name of the insurer; the country of domicile; the
   59  address of the insurer’s principal office and office in this
   60  state; the names of the owners of the insurer and their
   61  percentage of ownership; the names of the officers and directors
   62  of the insurer; the name, e-mail, and telephone number of a
   63  contact person for the insurer; and the number of individuals
   64  who are employed by the insurer or its affiliates in this state;
   65         b. The lines of insurance and types of products offered by
   66  the insurer other than life insurance policies or annuity
   67  contracts;
   68         c. A statement from the applicable regulatory body of the
   69  insurer’s domicile certifying that the insurer is licensed or
   70  registered for those lines of insurance and types of products in
   71  that domicile; and
   72         d. A copy of the filings required by the applicable
   73  regulatory body of the insurer’s country of domicile in that
   74  country’s official language or in English, if available;
   75         4. All certificates, policies, or contracts issued in this
   76  state showing coverage under the insurer’s policy include the
   77  following statement in a contrasting color and at least 10-point
   78  type: “The policy providing your coverage and the insurer
   79  providing this policy have not been approved by the Florida
   80  Office of Insurance Regulation”; and
   81         5. In the event the insurer ceases to do business from this
   82  state, the insurer will provide written notification to the
   83  office within 30 days after cessation.
   84         (b) For purposes of this subsection and subsection (9), the
   85  term “nonresident” means a trust or other entity organized and
   86  domiciled under the laws of a country other than the United
   87  States or a person who resides in and maintains a physical place
   88  of domicile in a country other than the United States, which he
   89  or she recognizes as and intends to maintain as his or her
   90  permanent home. A nonresident does not include an unauthorized
   91  immigrant present in the United States. Notwithstanding any
   92  other provision of law, it is conclusively presumed, for
   93  purposes of this subsection, that a person is a resident of the
   94  United States if the such person has:
   95         1. Had his or her principal place of domicile in the United
   96  States for 180 days or more in the 365 days before prior to
   97  issuance or renewal of the policy;
   98         2. Registered to vote in any state;
   99         3. Made a statement of domicile in any state; or
  100         4. Filed for homestead tax exemption on property in any
  101  state.
  102         (c) Subject to the limitations provided in this subsection,
  103  services, including those listed in s. 624.10, may be provided
  104  by the insurer or an affiliated person as defined in s. 624.04
  105  under common ownership or control with the insurer.
  106         (d) An alien insurer transacting insurance in this state
  107  without complying with this subsection or subsection (9) is
  108  shall be in violation of this chapter and subject to the
  109  penalties provided in s. 624.15.
  110         (9)(a) A life insurance policy or annuity contract issued
  111  by an insurer domiciled outside the United States covering only
  112  persons who, at the time of issuance, are not residents of the
  113  United States, if:
  114         1. The insurer is currently an authorized insurer in its
  115  country of domicile as to the kind of insurance proposed to be
  116  offered here and:
  117         a. Has been an insurer for not less than the immediately
  118  preceding 3 years;
  119         b. Is the wholly owned subsidiary of an authorized insurer;
  120  or
  121         c. Is the wholly owned subsidiary of an already eligible
  122  authorized insurer as to the kind of insurance proposed to be
  123  issued in this state for a period of not less than the
  124  immediately preceding 3 years.
  125  
  126  The Office of Insurance Regulation may waive the 3-year
  127  requirement if the insurer has operated successfully for a
  128  period of at least the immediately preceding year and has
  129  capital and surplus of not less than $25 million.
  130         2. Before the Office of Insurance Regulation grants the
  131  insurer eligibility to issue policies or contracts in this
  132  state, the requesting insurer furnishes the office with a duly
  133  authenticated copy of its current annual financial statement, in
  134  English, and with all monetary values therein expressed in
  135  United States dollars, at an exchange rate then-current and
  136  shown in the statement, in the case of statements originally
  137  made in the currencies of other countries, and with such
  138  additional information as the office may request.
  139         3. The insurer has and maintains surplus as to its
  140  policyholders of not less than $15 million. Any surplus in favor
  141  of policyholders shall be represented by investments consisting
  142  of eligible investments for like funds of like domestic insurers
  143  under part II of chapter 625. However, any surplus in favor to
  144  policyholders may be represented by investments permitted by the
  145  domestic regulator of such alien insurance company if the
  146  investments are substantially similar in terms of quality,
  147  liquidity, and security to eligible investments for like funds
  148  of like domestic insurers under part II of chapter 625.
  149         4. The insurer has a good reputation for providing service
  150  to its policyholders and the payment of losses and claims.
  151         5. The insurer furnishes the Office of Insurance Regulation
  152  within the time period specified in s. 624.424(1) a duly
  153  authenticated copy of its current annual and quarterly financial
  154  statements, in English, and with all monetary values therein
  155  expressed in United States dollars, at an exchange rate then
  156  current and shown in the statement, in the case of statements
  157  originally made in the currencies of other countries, and with
  158  such additional information relative to the insurer as the
  159  office may request.
  160         6. The insurer agrees to make its books and records
  161  pertaining to its operations in this state available for
  162  inspection during normal business hours at the request of the
  163  office.
  164         7. The insurer agrees to notify the applicant for a policy
  165  or contract in clear and conspicuous language:
  166         a. The date the insurer was organized.
  167         b. The identity of and rating assigned by each recognized
  168  insurance company rating organization that has rated the insurer
  169  or, if applicable, whether the insurer is unrated.
  170         c. That the insurer does not hold a certificate of
  171  authority issued in this state and that the Office of Insurance
  172  Regulation does not exercise regulatory oversight over the
  173  insurer.
  174         d. The identity and address of the regulatory authority
  175  exercising oversight of the insurer.
  176  
  177  This paragraph does not impose upon the Office of Insurance
  178  Regulation any duty or responsibility to determine the actual
  179  financial condition or claims practices of an unauthorized
  180  insurer, and the status of eligibility, if granted by the
  181  office, indicates only that the insurer appears to be
  182  financially sound and to have satisfactory claims practices and
  183  that the office has no credible evidence to the contrary.
  184         (b) If at any time the Office of Insurance Regulation has
  185  reason to believe that an insurer issuing policies or contracts
  186  pursuant to this subsection is insolvent or is in unsound
  187  financial condition, does not make reasonable prompt payment of
  188  benefits, or is no longer eligible to issue policies or
  189  contracts under the conditions specified in this subsection, the
  190  office may conduct an examination or investigation in accordance
  191  with s. 624.316, s. 624.3161, or s. 624.320 and, if the findings
  192  of the examination or investigation warrant, may withdraw the
  193  eligibility of the insurer to issue policies or contracts
  194  pursuant to this subsection without having a certificate of
  195  authority issued by the office.
  196         (c) This subsection does not provide an exception to the
  197  agent licensure requirements of chapter 626. An insurer issuing
  198  policies or contracts pursuant to this subsection shall appoint
  199  the agents that the insurer uses to sell such policies or
  200  contracts as provided in chapter 626.
  201         (d) An insurer issuing policies or contracts pursuant to
  202  this subsection is subject to part IX of chapter 626, relating
  203  to unfair insurance trade practices, and the office may take
  204  such action against the insurer for a violation as are provided
  205  in that part.
  206         (e) Policies and contracts issued pursuant to this
  207  subsection are not subject to the premium tax specified in s.
  208  624.509.
  209         (f) An application for life insurance coverage or an
  210  annuity contract offered under this subsection must contain, in
  211  contrasting color and not less than 12-point type, the following
  212  statement on the same page as the applicant’s signature:
  213  
  214         This policy is primarily governed by the laws of a
  215         foreign country. As a result, all of the rating and
  216         underwriting laws applicable to policies filed in this
  217         state do not apply to this coverage, which may result
  218         in your premiums being higher than would be
  219         permissible under a Florida-approved policy. Any
  220         purchase of individual life insurance should be
  221         considered carefully, as future medical conditions may
  222         make it impossible to qualify for another individual
  223         life policy. If the insurer issuing your policy
  224         becomes insolvent, this policy is not covered by the
  225         Florida Life and Health Insurance Guaranty
  226         Association. For information concerning individual
  227         life coverage under a Florida-approved policy, consult
  228         your agent or the Florida Department of Financial
  229         Services.
  230  
  231         (g) All life insurance policies and annuity contracts
  232  issued pursuant to this subsection must contain on the first
  233  page of the policy or contract, in contrasting color and not
  234  less than 10-point type, the following statement:
  235  
  236         The benefits of the policy providing your coverage are
  237         governed primarily by the law of a country other than
  238         the United States.
  239  
  240         (h) All single-premium life insurance policies and single
  241  premium annuity contracts issued to persons who are not
  242  residents of the United States and are not nonresidents
  243  illegally residing in the United States pursuant to this
  244  subsection are subject to chapter 896.
  245         Section 2. This act shall take effect July 1, 2012.