The bill amends sections 634.3077 and 634.406 of the Florida Statutes to update the financial requirements for home and service warranty associations. It introduces technical changes and clarifies the conditions under which these associations are exempt from establishing unearned premium reserves and maintaining contractual liability insurance. Specifically, the bill allows associations to avoid these requirements if they purchase contractual liability insurance that covers 100% of their claim exposure. The amendments also specify that the insurance must be obtained from authorized insurers and include provisions for claims administration and cancellation notifications.

Additionally, the bill revises the criteria for associations to exceed the 7-to-1 ratio of gross written premiums to net assets, allowing for more flexibility in their financial operations. It emphasizes the need for associations to maintain a minimum net worth and provides guidelines for documentation to be submitted to the office. The effective date for these changes is set for July 1, 2025. The bill includes numerous insertions and deletions to enhance clarity and ensure compliance with the updated requirements.

Statutes affected:
H 367 Filed: 634.3077