Florida Senate - 2015                             CS for SB 1094
       By the Committee on Banking and Insurance; and Senator Brandes
       597-02117A-15                                         20151094c1
    1                        A bill to be entitled                      
    2         An act relating to the peril of flood; amending s.
    3         163.3178, F.S.; specifying components that must be
    4         contained in the coastal management element required
    5         for a local government comprehensive plan; creating s.
    6         472.0366, F.S.; defining terms; requiring a surveyor
    7         and mapper to complete an elevation certificate in
    8         accordance with a checklist developed by the Division
    9         of Emergency Management and to submit a copy of the
   10         elevation certificate to the division within a certain
   11         time after its completion; authorizing the redaction
   12         of certain personal information from the copy;
   13         amending s. 627.715, F.S.; authorizing flexible flood
   14         insurance; specifying coverage requirements; requiring
   15         such insurance to be acceptable to the mortgage lender
   16         if intended to satisfy a mortgage requirement;
   17         deleting a provision that prohibits supplemental flood
   18         insurance from including excess coverage over any
   19         other insurance covering the peril of flood; revising
   20         the information that must be prominently noted on a
   21         certain page of a flood insurance policy; requiring
   22         the Office of Insurance Regulation to require an
   23         insurer to provide appropriate credit to affected
   24         insureds if the office determines that a rate of the
   25         insurer is excessive or unfairly discriminatory;
   26         revising the notice that must be provided to and
   27         acknowledged by an applicant for flood coverage from
   28         an authorized or surplus lines insurer if the
   29         applicant’s property is receiving flood insurance
   30         under the National Flood Insurance Program; allowing
   31         an authorized insurer to request a certification from
   32         the office which indicates that a policy, contract, or
   33         endorsement issued by the insurer provides coverage
   34         for the peril of flood which equals or exceeds the
   35         flood coverage offered by the National Flood Insurance
   36         Program; specifying requirements for such
   37         certification; authorizing such insurer or its agent
   38         to reference or include the certification in specified
   39         advertising, communications, and documentation;
   40         providing that misrepresenting that a flood policy,
   41         contract, or endorsement is certified is an unfair or
   42         deceptive act; providing an effective date.
   44  Be It Enacted by the Legislature of the State of Florida:
   46         Section 1. Paragraph (f) of subsection (2) of section
   47  163.3178, Florida Statutes, is amended to read:
   48         163.3178 Coastal management.—
   49         (2) Each coastal management element required by s.
   50  163.3177(6)(g) shall be based on studies, surveys, and data; be
   51  consistent with coastal resource plans prepared and adopted
   52  pursuant to general or special law; and contain:
   53         (f) A redevelopment component that which outlines the
   54  principles that must which shall be used to eliminate
   55  inappropriate and unsafe development in the coastal areas when
   56  opportunities arise. The component must:
   57         1. Include development and redevelopment principles,
   58  strategies, and engineering solutions that reduce the flood risk
   59  in coastal areas which results from high-tide events, storm
   60  surge, flash floods, stormwater runoff, and the related impacts
   61  of sea-level rise.
   62         2. Encourage the use of best practices development and
   63  redevelopment principles, strategies, and engineering solutions
   64  that will result in the removal of coastal real property from
   65  flood zone designations established by the Federal Emergency
   66  Management Agency.
   67         3. Identify site development techniques and best practices
   68  that may reduce losses due to flooding and claims made under
   69  flood insurance policies issued in this state.
   70         Section 2. Section 472.0366, Florida Statutes, is created
   71  to read:
   72         472.0366 Elevation certificates; requirements for surveyors
   73  and mappers.—
   74         (1)As used in this section, the term:
   75         (a) “Division” means the Division of Emergency Management
   76  established within the Executive Office of the Governor under s.
   77  14.2016.
   78         (b) “Elevation certificate” means the certificate used to
   79  demonstrate the elevation of property which has been developed
   80  by the Federal Emergency Management Agency pursuant to federal
   81  floodplain management regulation and which is completed by a
   82  surveyor and mapper.
   83         (2) An elevation certificate must be completed by a
   84  surveyor and mapper in accordance with the checklist developed
   85  by the division. Within 30 days after the completion of an
   86  elevation certificate, a surveyor and mapper must submit a copy
   87  of the certificate to the division. The copy must be unaltered,
   88  except that the surveyor and mapper may redact the name of the
   89  property owner.
   90         Section 3. Section 627.715, Florida Statutes, is amended to
   91  read:
   92         627.715 Flood insurance.—An authorized insurer may issue an
   93  insurance policy, contract, or endorsement providing personal
   94  lines residential coverage for the peril of flood on any
   95  structure or the contents of personal property contained
   96  therein, subject to this section. This section does not apply to
   97  commercial lines residential or commercial lines nonresidential
   98  coverage for the peril of flood. This section also does not
   99  apply to coverage for the peril of flood that is excess coverage
  100  over any other insurance covering the peril of flood. An insurer
  101  may issue flood insurance policies, contracts, or endorsements
  102  on a standard, preferred, customized, or supplemental basis.
  103         (1)(a)1. Standard flood insurance must cover only losses
  104  from the peril of flood, as defined in paragraph (b), equivalent
  105  to that provided under a standard flood insurance policy under
  106  the National Flood Insurance Program. Standard flood insurance
  107  issued under this section must provide the same coverage,
  108  including deductibles and adjustment of losses, as that provided
  109  under a standard flood insurance policy under the National Flood
  110  Insurance Program.
  111         2. Preferred flood insurance must include the same coverage
  112  as standard flood insurance but:
  113         a. Include, within the definition of “flood,” losses from
  114  water intrusion originating from outside the structure that are
  115  not otherwise covered under the definition of “flood” provided
  116  in paragraph (b).
  117         b. Include coverage for additional living expenses.
  118         c. Require that any loss under personal property or
  119  contents coverage that is repaired or replaced be adjusted only
  120  on the basis of replacement costs up to the policy limits.
  121         3. Customized flood insurance must include coverage that is
  122  broader than the coverage provided under standard flood
  123  insurance.
  124         4. Flexible flood insurance must cover losses from the
  125  peril of flood, as defined in paragraph (b), and may also
  126  include coverage for losses from water intrusion originating
  127  from outside the structure which is not otherwise covered by the
  128  definition of flood. Flexible flood insurance must include one
  129  or more of the following provisions:
  130         a. An agreement between the insurer and the insured that
  131  the flood coverage is in a specified amount, such as coverage
  132  that is limited to the total amount of each outstanding mortgage
  133  applicable to the covered property.
  134         b. A requirement for a deductible in an amount authorized
  135  under s. 627.701, including a deductible in an amount authorized
  136  for hurricanes.
  137         c. A requirement that flood loss to a dwelling be adjusted
  138  in accordance with s. 627.7011(3) or adjusted only on the basis
  139  of the actual cash value of the property.
  140         d. A restriction limiting flood coverage to the principal
  141  building defined in the policy.
  142         e. A provision including or excluding coverage for
  143  additional living expenses.
  144         f. A provision excluding coverage for personal property or
  145  contents as to the peril of flood.
  147  Flexible flood insurance must be acceptable to the mortgage
  148  lender if such policy, contract, or endorsement is intended to
  149  satisfy a mortgage requirement.
  150         5.4. Supplemental flood insurance may provide coverage
  151  designed to supplement a flood policy obtained from the National
  152  Flood Insurance Program or from an insurer issuing standard or
  153  preferred flood insurance pursuant to this section. Supplemental
  154  flood insurance may provide, but need not be limited to,
  155  coverage for jewelry, art, deductibles, and additional living
  156  expenses. Supplemental flood insurance does not include coverage
  157  for the peril of flood that is excess coverage over any other
  158  insurance covering the peril of flood.
  159         (b) “Flood” means a general and temporary condition of
  160  partial or complete inundation of two or more acres of normally
  161  dry land area or of two or more properties, at least one of
  162  which is the policyholder’s property, from:
  163         1. Overflow of inland or tidal waters;
  164         2. Unusual and rapid accumulation or runoff of surface
  165  waters from any source;
  166         3. Mudflow; or
  167         4. Collapse or subsidence of land along the shore of a lake
  168  or similar body of water as a result of erosion or undermining
  169  caused by waves or currents of water exceeding anticipated
  170  cyclical levels that result in a flood as defined in this
  171  paragraph.
  172         (2) Any limitations on Flood coverage deductibles and or
  173  policy limits pursuant to this section, including, but not
  174  limited to, deductibles, must be prominently noted on the policy
  175  declarations page or face page.
  176         (3)(a) An insurer may establish and use flood coverage
  177  rates in accordance with the rate standards provided in s.
  178  627.062.
  179         (b) For flood coverage rates filed with the office before
  180  October 1, 2019, the insurer may also establish and use such
  181  rates in accordance with the rates, rating schedules, or rating
  182  manuals filed by the insurer with the office which allow the
  183  insurer a reasonable rate of return on flood coverage written in
  184  this state. Flood coverage rates established pursuant to this
  185  paragraph are not subject to s. 627.062(2)(a) and (f). An
  186  insurer shall notify the office of any change to such rates
  187  within 30 days after the effective date of the change. The
  188  notice must include the name of the insurer and the average
  189  statewide percentage change in rates. Actuarial data with regard
  190  to such rates for flood coverage must be maintained by the
  191  insurer for 2 years after the effective date of such rate change
  192  and is subject to examination by the office. The office may
  193  require the insurer to incur the costs associated with an
  194  examination. Upon examination, the office, in accordance with
  195  generally accepted and reasonable actuarial techniques, shall
  196  consider the rate factors in s. 627.062(2)(b), (c), and (d), and
  197  the standards in s. 627.062(2)(e), to determine if the rate is
  198  excessive, inadequate, or unfairly discriminatory. If the office
  199  determines that a rate is excessive or unfairly discriminatory,
  200  the office shall require the insurer to provide appropriate
  201  credit to affected insureds.
  202         (4) A surplus lines agent may export a contract or
  203  endorsement providing flood coverage to an eligible surplus
  204  lines insurer without making a diligent effort to seek such
  205  coverage from three or more authorized insurers under s.
  206  626.916(1)(a). This subsection expires July 1, 2017.
  207         (5) In addition to any other applicable requirements, an
  208  insurer providing flood coverage in this state must:
  209         (a) Notify the office at least 30 days before writing flood
  210  insurance in this state; and
  211         (b) File a plan of operation and financial projections or
  212  revisions to such plan, as applicable, with the office.
  213         (6) Citizens Property Insurance Corporation may not provide
  214  insurance for the peril of flood.
  215         (7) The Florida Hurricane Catastrophe Fund may not provide
  216  reimbursement for losses proximately caused by the peril of
  217  flood, including losses that occur during a covered event as
  218  defined in s. 215.555(2)(b).
  219         (8) An agent must, upon receiving obtaining an application
  220  for flood coverage from an authorized or surplus lines insurer
  221  for a property receiving flood insurance under the National
  222  Flood Insurance Program, must obtain an acknowledgment signed by
  223  the applicant before placing the coverage with the authorized or
  224  surplus lines insurer. The acknowledgment must notify the
  225  applicant that, if the applicant discontinues coverage under the
  226  National Flood Insurance Program which is provided at a
  227  subsidized rate, the full risk rate for flood insurance may
  228  apply to the property if the applicant such insurance is later
  229  seeks to reinstate coverage obtained under the National Flood
  230  Insurance program.
  231         (9) With respect to the regulation of flood coverage
  232  written in this state by authorized insurers, this section
  233  supersedes any other provision in the Florida Insurance Code in
  234  the event of a conflict.
  235         (10) If federal law or rule requires a certification by a
  236  state insurance regulatory official as a condition of qualifying
  237  for private flood insurance or disaster assistance, the
  238  Commissioner of Insurance Regulation may provide the
  239  certification, and such certification is not subject to review
  240  under chapter 120.
  241         (11)(a) An authorized insurer offering flood insurance may
  242  request the office to certify that a policy, contract, or
  243  endorsement provides coverage for the peril of flood which
  244  equals or exceeds the flood coverage offered by the National
  245  Flood Insurance Program. To be eligible for certification, such
  246  policy, contract, or endorsement must contain a provision
  247  stating that it meets the private flood insurance requirements
  248  specified in 42 U.S.C. s. 4012a(b) and may not contain any
  249  provision that is not in compliance with 42 U.S.C. s. 4012a(b).
  250         (b) The authorized insurer or its agent may reference or
  251  include a certification under paragraph (a) in advertising or
  252  communications with an agent, a lending institution, an insured,
  253  or a potential insured only for a policy, contract, or
  254  endorsement that is certified under this subsection. The
  255  authorized insurer may include a statement that notifies an
  256  insured of the certification on the declarations page or other
  257  policy documentation related to flood coverage certified under
  258  this subsection.
  259         (c) An insurer or agent who knowingly misrepresents that a
  260  flood policy, contract, or endorsement is certified under this
  261  subsection commits an unfair or deceptive act under s. 626.9541.
  262         Section 4. This act shall take effect July 1, 2015.