Florida Senate - 2016                        COMMITTEE AMENDMENT
       Bill No. SB 828
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  01/11/2016           .                                

       The Committee on Banking and Insurance (Hukill) recommended the
    1         Senate Amendment 
    3         Delete lines 50 - 143
    4  and insert:
    5  percentage rate on new and renewal policies issued and effective
    6  during the period of 12 months beginning on January 1, April 1,
    7  July 1, or October 1, whichever is the first day of the
    8  following calendar quarter as specified in an order issued by
    9  the office directing insurers to pay an assessment to the
   10  association. The surcharge may not begin until 90 days after the
   11  board of directors certifies the assessment.
   12         2. Beginning July 1, 1997, assessments levied against self
   13  insurance funds shall not exceed in any calendar year more than
   14  1.50 percent of that self-insurance fund’s net direct written
   15  premiums in this state for workers’ compensation insurance
   16  during the calendar year next preceding the date of such
   17  assessments.
   18         3. Beginning July 1, 2003, assessments levied against
   19  insurers and self-insurance funds pursuant to this paragraph are
   20  computed and levied on the basis of the full policy premium
   21  value on the net direct premiums written in the state for
   22  workers’ compensation insurance during the calendar year next
   23  preceding the date of the assessment without taking into account
   24  any applicable discount or credit for deductibles. Insurers and
   25  self-insurance funds must report premiums in compliance with
   26  this subparagraph.
   27         (b) Assessments shall be included as an appropriate factor
   28  in the making of rates.
   29         (c)1.Effective July 1, 1999, If assessments otherwise
   30  authorized in paragraph (a) are insufficient to make all
   31  payments on reimbursements then owing to claimants in a calendar
   32  year, then upon certification by the board, the office
   33  department shall levy additional assessments of up to 1.5
   34  percent of the insurer’s net direct written premiums in this
   35  state during the calendar year next preceding the date of such
   36  assessments against insurers to secure the necessary funds.
   37         (d) The association may use an installment method to
   38  require the insurer to remit the assessment as premium is
   39  written or may require the insurer to remit the assessment to
   40  the association before collecting the policyholder surcharge. If
   41  the assessment is remitted before the surcharge is collected,
   42  the assessment remitted must be based on an estimate of the
   43  assessment due based on the proportion of each insurer’s net
   44  direct written premium in this state for the preceding calendar
   45  year as described in paragraph (a) and adjusted following the
   46  end of the 12-month period during which the assessment is
   47  levied.
   48         1. If the association elects to use the installment method,
   49  the office may, in the order levying the assessment on insurers,
   50  specify that the assessment is due and payable quarterly as
   51  premium is written throughout the assessment year. Insurers
   52  shall collect surcharges at a uniform percentage rate specified
   53  by order as described in paragraph (b). Insurers are not
   54  required to advance funds if the association and the office
   55  elect to use the installment option. Assessments levied under
   56  this subparagraph are paid after policy surcharges are
   57  collected, and the recognition of assets is based on actual
   58  premium written offset by the obligation to the association.
   59         2. If the association elects to require insurers to remit
   60  the assessment before surcharging the policyholder, the
   61  following shall apply:
   62         a. The levy order shall provide each insurer so assessed at
   63  least 30 days written notice of the date the initial assessment
   64  payment is due and payable by the insurer.
   65         b. Insurers shall collect surcharges at a uniform
   66  percentage rate specified by the order, as described in
   67  paragraph (b).
   68         c. Assessments levied under this subparagraph are paid
   69  before policy surcharges are billed and result in a receivable
   70  for policy surcharges to be billed in the future. The amount of
   71  billed surcharges, to the extent it is likely that it will be
   72  realized, meets the definition of an admissible asset as
   73  specified in the National Association of Insurance
   74  Commissioners’ Statement of Statutory Accounting Principles No.
   75  4. The asset shall be established and recorded separately from
   76  the liability. If an insurer is unable to fully recoup the
   77  amount of the assessment, the amount recorded as an asset shall
   78  be reduced to the amount reasonably expected to be recouped.
   79         3. Insurers must submit a reconciliation report to the
   80  association within 120 days after the end of the 12-month
   81  assessment period and annually thereafter for a period of three
   82  years. The report must indicate the amount of the initial
   83  payment or installment payments made to the association and the
   84  amount of written premium pursuant to paragraph (a) for the
   85  assessment year. If the insurer’s reconciled assessment
   86  obligation is more than the amount paid to the association, the
   87  insurer shall pay the excess surcharges collected to the
   88  association. If the insurer’s reconciled assessment obligation
   89  is less than the initial amount paid to the association, the
   90  association shall credit the insurer that amount against future
   91  assessments.
   92         (2) Assessments levied under this section are not premium
   93  and are not subject to any premium tax, fees, or commissions.
   94  Insurers shall treat the failure of an insured to pay
   95  assessment-related surcharges as a failure to pay premium. An
   96  insurer is not liable for any uncollectible assessment-related
   97  surcharges.
   98         (3) Assessments levied under this section may be levied
   99  only upon insurers. This section does not create a cause of
  100  action by a policyholder with respect to the levying of an
  101  assessment or a policyholder’s duty to pay assessment-related
  102  surcharges.