Florida Senate - 2019                        COMMITTEE AMENDMENT
       Bill No. SB 714
       
       
       
       
       
       
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                              LEGISLATIVE ACTION                        
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       The Committee on Banking and Insurance (Brandes) recommended the
       following:
       
    1         Senate Amendment (with title amendment)
    2  
    3         Between lines 29 and 30
    4  insert:
    5         Section 2. Effective January 1, 2020, paragraph (b) of
    6  subsection (4) of section 215.555, Florida Statutes, is amended
    7  to read:
    8         215.555 Florida Hurricane Catastrophe Fund.—
    9         (4) REIMBURSEMENT CONTRACTS.—
   10         (b)1. The contract shall contain a promise by the board to
   11  reimburse the insurer for 45 percent, 75 percent, or 90 percent
   12  of its losses from each covered event in excess of the insurer’s
   13  retention, plus, for the purpose of covering loss adjustment
   14  expenses, the lesser of 15 percent of the reimbursed losses or
   15  the uniform loss adjustment expense percentage adopted pursuant
   16  to s. 215.55953 5 percent of the reimbursed losses to cover loss
   17  adjustment expenses.
   18         2. The insurer must elect one of the percentage coverage
   19  levels specified in this paragraph and may, upon renewal of a
   20  reimbursement contract, elect a lower percentage coverage level
   21  if no revenue bonds issued under subsection (6) after a covered
   22  event are outstanding, or elect a higher percentage coverage
   23  level, regardless of whether or not revenue bonds are
   24  outstanding. All members of an insurer group must elect the same
   25  percentage coverage level. Any joint underwriting association,
   26  risk apportionment plan, or other entity created under s.
   27  627.351 must elect the 90-percent coverage level.
   28         3. The contract shall provide that reimbursement amounts
   29  shall not be reduced by reinsurance paid or payable to the
   30  insurer from other sources.
   31         Section 3. Section 215.55953, Florida Statutes, is created
   32  to read:
   33         215.55953 Uniform loss adjustment expense percentage.—
   34         (1) No later than December 1, 2019, the Financial Services
   35  Commission shall establish by rule a uniform loss adjustment
   36  expense percentage for the reasonable reimbursement by the
   37  Florida Hurricane Catastrophe Fund of loss adjustment expenses
   38  incurred in adjusting losses for covered policies under s.
   39  215.555. In determining the reasonable loss adjustment expenses
   40  incurred in adjusting such losses, the commission shall
   41  consider:
   42         (a) The total losses and loss adjustment expenses that have
   43  been incurred by authorized insurers related to losses caused by
   44  covered events as defined in s. 215.555(2)(b).
   45         (b) The actual claims paying capacity of the Florida
   46  Hurricane Catastrophe Fund.
   47         (c) Other information the commission finds is relevant to
   48  determining the reasonable loss expenses incurred in adjusting
   49  losses reimbursable under s. 215.555.
   50         (2) No later than March 1 of the calendar year following a
   51  covered event under s. 215.555, the Office of Insurance
   52  Regulation shall advise the commission as to the necessity of
   53  adopting a new uniform loss adjustment expense percentage. Upon
   54  a recommendation from the Office of Insurance Regulation that
   55  the commission adopt a new uniform loss adjustment percentage,
   56  the commission shall do so by rule no later than December 1 of
   57  the year such recommendation is made.
   58         (3) Rules adopted pursuant to this section are not subject
   59  to the requirements of s. 120.541.
   60  
   61         Delete line 122
   62  and insert:
   63         Section 9. Except as otherwise expressly provided in this
   64  act, this act shall take effect July 1, 2019.
   65  
   66  ================= T I T L E  A M E N D M E N T ================
   67  And the title is amended as follows:
   68         Between lines 2 and 3
   69  insert:
   70         amending s. 215.555, F.S.; revising the reimbursement
   71         of loss adjustment expenses by the Florida Hurricane
   72         Catastrophe Fund; creating s. 215.55953, F.S.;
   73         requiring the Financial Services Commission, by a
   74         specified date, to adopt a certain uniform loss
   75         adjustment expense percentage by rule; specifying
   76         information the commission must consider in
   77         determining certain incurred expenses; requiring the
   78         Office of Insurance Regulation, under certain
   79         circumstances, to advise the commission on certain
   80         matters; requiring the commission to adopt certain
   81         rules under certain circumstances; providing that
   82         adopted rules are not subject to requirements for a
   83         statement of estimated regulatory costs;
   84  
   85         Delete line 25
   86  and insert:
   87         program; providing effective dates.