Florida Senate - 2015 CS for SB 600 By the Committee on Banking and Insurance; and Senator Richter 597-01653-15 2015600c1 1 A bill to be entitled 2 An act relating to insurance guaranty associations; 3 amending s. 625.012, F.S.; revising the definition of 4 the term “asset” to include Florida Insurance Guaranty 5 Association assessments, under certain conditions, for 6 purposes of determining the financial condition of an 7 insurer; amending ss. 631.717 and 631.737, F.S.; 8 transferring a provision relating to the obligation of 9 the Florida Life and Health Insurance Guaranty 10 Association to pay valid claims under certain 11 circumstances; reenacting ss. 624.316(1)(a), 625.031, 12 625.305(1), 627.828(3)(b), and 629.401(6)(a), F.S., to 13 incorporate the amendments made to s. 625.012, F.S., 14 in references thereto; providing an effective date. 15 16 Be It Enacted by the Legislature of the State of Florida: 17 18 Section 1. Subsections (15) and (16) of section 625.012, 19 Florida Statutes, are redesignated as subsections (16) and (17), 20 respectively, and a new subsection (15) is added to that 21 section, to read: 22 625.012 “Assets” defined.—In any determination of the 23 financial condition of an insurer, there shall be allowed as 24 “assets” only such assets as are owned by the insurer and which 25 consist of: 26 (15)(a) Assessments levied under s. 631.57(3)(a) and (e) 27 which are paid before policy surcharges are collected and result 28 in a receivable for policy surcharges to be collected in the 29 future. This amount, to the extent it is likely that it will be 30 realized, meets the definition of an admissible asset as 31 specified in the National Association of Insurance 32 Commissioners’ Statement of Statutory Accounting Principles No. 33 4. The asset shall be established and recorded separately from 34 the liability regardless of whether it is based on a 35 retrospective or prospective premium-based assessment. If an 36 insurer is unable to fully recoup the amount of the assessment 37 because of a reduction in writings or withdrawal from the 38 market, the amount recorded as an asset shall be reduced to the 39 amount reasonably expected to be recouped. 40 (b) Assessments levied as monthly installments under s. 41 631.57(3)(e)1.c. which are paid after policy surcharges are 42 collected so that the recognition of assets is based on actual 43 premium written offset by the obligation to the Florida 44 Insurance Guaranty Association. 45 Section 2. Subsection (11) of section 631.717, Florida 46 Statutes, is amended to read: 47 631.717 Powers and duties of the association.— 48 (11) The association is
shallnot beliable for any civil 49 action under s. 624.155 arising from any acts alleged to have 50 been committed by a member insurer before prior toits 51 liquidation. This subsection does not affect the association’s52 obligation to pay valid insurance policy or contract claims if53 warranted after its independent de novo review of the policies,54 contracts, and claims presented to it, whether domestic or55 foreign, after a Florida domestic rehabilitation or a56 liquidation.57 Section 3. Section 631.737, Florida Statutes, is amended to 58 read: 59 631.737 Rescission and review generally.—The association 60 shall review claims and matters regarding covered policies based 61 upon the record available to it on and after the date of 62 liquidation. Notwithstanding any other provision of this part, 63 in order to allow for orderly claims administration by the 64 association, entry of a liquidation order by a court of 65 competent jurisdiction tolls shall be deemed to tollfor 1 year 66 any rescission or noncontestable period allowed by the contract, 67 the policy, or by law. The association’s obligation is to pay 68 any valid insurance policy or contract claims, if warranted, 69 after its independent de novo review of the policies, contracts, 70 and claims presented to it, whether domestic or foreign, 71 following a rehabilitation or a liquidation. 72 Section 4. Paragraph (a) of subsection (1) of s. 624.316, 73 s. 625.031, subsection (1) of s. 625.305, paragraph (b) of 74 subsection (3) of s. 627.828, and paragraph (a) of subsection 75 (6) of s. 629.401, Florida Statutes, are reenacted for the 76 purpose of incorporating the amendments made by this act to s. 77 625.012, Florida Statutes, in references thereto. 78 Section 5. This act shall take effect July 1, 2015.