This bill amends sections of Florida Statutes related to financial requirements for home and service warranty associations. It introduces technical changes and revises the conditions under which these associations are exempt from establishing unearned premium reserves and maintaining contractual liability insurance. Specifically, the bill stipulates that associations can avoid these requirements if they purchase contractual liability insurance that covers 100% of their claim exposure. The new language emphasizes that such insurance must be obtained from authorized insurers and includes provisions for the administration of claims, cancellation notices, and coverage of all contracts issued while the policy is in effect.

Additionally, the bill allows associations to exceed the 7-to-1 ratio of gross written premiums to net assets under certain conditions, such as maintaining a minimum net worth and providing financial documentation to the office. It also clarifies that associations can utilize both unearned premium reserves and contractual liability insurance for different service warranties, provided they can distinguish between the two. The effective date for these changes is set for July 1, 2025.

Statutes affected:
S 282 Filed: 634.3077