Florida Senate - 2023 SB 1340



By Senator Grall





29-01330A-23 20231340__
1 A bill to be entitled
2 An act relating to insurance; amending s. 624.155,
3 F.S.; providing construction relating to the recovery
4 of damages under the common-law remedy of bad faith
5 against insurers; amending s. 624.3161, F.S.;
6 providing that specified property insurers shall,
7 rather than may, be subject to an additional market
8 conduct examination after a hurricane; amending s.
9 624.4055, F.S.; revising a prohibition against the
10 continued writing of private passenger automobile
11 insurance by certain insurers; amending ss. 624.407
12 and 624.408, F.S.; revising minimum surplus
13 requirements for certain residential property
14 insurers; amending s. 624.424, F.S.; revising
15 information required to be reported by property
16 insurers in certain supplemental reports; specifying
17 requirements for the Office of Insurance Regulation in
18 publicly reporting certain data; providing
19 construction; amending s. 626.9201, F.S.; prohibiting
20 insurers providing homeowners’ insurance or commercial
21 property insurance from canceling, nonrenewing, or
22 terminating a policy during a pending claim except
23 under certain circumstances; amending s. 626.9541,
24 F.S.; adding unfair claim settlement practices that
25 constitute unfair methods of competition or unfair or
26 deceptive acts or practices; prohibiting directors or
27 officers of insolvent or impaired insurers from
28 authorizing or permitting the payment of certain
29 bonuses; defining the term “bonus”; providing a
30 criminal penalty; amending s. 627.0613, F.S.;
31 requiring the consumer advocate, in conjunction with
32 the Department of Financial Services and the office,
33 to annually prepare and make publicly available a
34 report relating to insurer rate increases; amending s.
35 627.351, F.S.; deleting a requirement that a Citizens
36 Property Insurance Corporation policyholder making a
37 claim for water damage has the burden of proving that
38 the damage was not caused by flooding; amending s.
39 627.35191, F.S.; requiring the corporation to provide
40 to the Legislature and the Financial Services
41 Commission an annual supplemental report relating to
42 closed claims; specifying requirements for the report;
43 amending s. 627.4133, F.S.; prohibiting insurers
44 providing homeowners’ insurance from canceling,
45 nonrenewing, or terminating a policy during a pending
46 claim except under certain circumstances; amending s.
47 627.420, F.S.; prohibiting certain actions by an
48 insurer issuing a homeowner’s insurance binder before
49 closing to a purchaser of residential property;
50 requiring such insurer to perform any required
51 inspections before binding coverage; requiring a
52 seller of a new home purchase to allow access to the
53 property for such inspection before closing; amending
54 s. 627.701, F.S.; providing that if a roof deductible
55 is applied under a personal lines residential property
56 insurance policy, no other deductible may be applied
57 to certain other losses; amending s. 627.7011, F.S.;
58 providing that if a homeowner’s insurance policy
59 provides an option with limited coverage, the insurer
60 must offer a premium with a certain discount or
61 credit; creating s. 627.70111, F.S.; requiring a
62 specified notice period to a homeowner before any
63 inspection of the homeowner’s residential property for
64 insurance purposes, except under certain
65 circumstances; amending s. 627.70131, F.S.; providing
66 that repeated violations of certain prompt payment
67 requirements are an unfair method of competition and
68 an unfair or deceptive act or practice; deleting a
69 provision providing that failure to comply with
70 certain provisions does not form the sole basis for a
71 private cause of action; amending s. 627.70132, F.S.;
72 providing that certain timeframes to provide notice of
73 a property insurance claim are tolled during the
74 period of active duty for an insured in active
75 military service; amending s. 627.70152, F.S.;
76 requiring a property insurer to provide a certain
77 response to a presuit notice to the department;
78 deleting the authority for an insurer to require the
79 claimant to participate in appraisal; providing that a
80 policy must require a claimant’s consent; specifying a
81 limitation and restriction on invoking appraisal;
82 providing that a certain notice and response are
83 admissible as evidence in certain proceedings;
84 requiring that any alternative dispute resolution
85 process be authorized by statute; creating s.
86 627.70155, F.S.; specifying restrictions on property
87 insurance policies relating to venue and controlling
88 law provisions; amending s. 627.702, F.S.; providing
89 that certain total losses under the valued policy law
90 may not be subject to any requirement for the insured
91 to participate in appraisal; amending s. 768.79, F.S.;
92 revising conditions for making, and parties who may
93 make, certain joint offers of judgment or settlement;
94 providing an effective date.
95
96 Be It Enacted by the Legislature of the State of Florida:
97
98 Section 1. Subsection (8) of section 624.155, Florida
99 Statutes, is amended to read:
100 624.155 Civil remedy.—
101 (8) The civil remedy specified in this section does not
102 preempt any other remedy or cause of action provided for
103 pursuant to any other statute or pursuant to the common law of
104 this state. Any person may obtain a judgment under either the
105 common-law remedy of bad faith or this statutory remedy, but
106 shall not be entitled to a judgment under both remedies. This
107 section shall not be construed to create a common-law cause of
108 action. The damages recoverable pursuant to this section shall
109 include those damages which are a reasonably foreseeable result
110 of a specified violation of this section by the authorized
111 insurer and may include an award or judgment in an amount that
112 exceeds the policy limits. This section does not limit or
113 prohibit the recovery of any damages under the common-law remedy
114 of bad faith, and extracontractual, consequential damages may be
115 recovered under such remedy.
116 Section 2. Subsection (7) of section 624.3161, Florida
117 Statutes, is amended to read:
118 624.3161 Market conduct examinations.—
119 (7) Notwithstanding subsection (1), any authorized insurer
120 transacting property insurance business in this state shall may
121 be subject to an additional market conduct examination after a
122 hurricane if the insurer:
123 (a) Is among the top 20 percent of insurers based upon a
124 calculation of the ratio of hurricane-related property insurance
125 claims filed to the number of property insurance policies in
126 force;
127 (b) Is among the top 20 percent of insurers based upon a
128 calculation of the ratio of consumer complaints made to the
129 department to hurricane-related claims;
130 (c) Has made significant payments to its managing general
131 agent since the hurricane; or
132 (d) Is identified by the office as necessitating a market
133 conduct exam for any other reason.
134
135 All relevant criteria under this section and s. 624.316 shall be
136 applied to the market conduct examination under this subsection.
137 Such an examination must be initiated within 18 months after the
138 landfall of a hurricane that results in an executive order or a
139 state of emergency issued by the Governor. An examination of an
140 insurer under this subsection must also include an examination
141 of its managing general agent as if it were the insurer.
142 Section 3. Section 624.4055, Florida Statutes, is amended
143 to read:
144 624.4055 Restrictions on existing private passenger
145 automobile insurance.—An No insurer writing private passenger
146 automobile insurance in this state may not continue to write
147 such insurance if the insurer:
148 (1) Writes homeowners’ insurance in another state but not
149 in this state; or
150 (2) Writes homeowners’ insurance in this state, but the
151 number of homeowners’ insurance policies that it writes or
152 renews in this state in any calendar year is less than 5 percent
153 of the total number of policies written or renewed by the
154 insurer for all kinds of insurance transacted in this state by
155 the insurer, unless the insurer writing private passenger
156 automobile insurance in this state is affiliated with an insurer
157 writing homeowners’ insurance in this state.
158 Section 4. Subsection (1) of section 624.407, Florida
159 Statutes, is amended to read:
160 624.407 Surplus required; new insurers.—
161 (1) To receive authority to transact any one kind or
162 combinations of kinds of insurance, as defined in part V of this
163 chapter, an insurer applying for its original certificate of
164 authority in this state shall possess surplus as to
165 policyholders at least the greater of:
166 (a) For a property and casualty insurer, $5 million, or
167 $2.5 million for any other insurer;
168 (b) For life insurers, 4 percent of the insurer’s total
169 liabilities;
170 (c) For life and health insurers, 4 percent of the
171 insurer’s total liabilities, plus 6 percent of the insurer’s
172 liabilities relative to health insurance;
173 (d) For all insurers other than life insurers and life and
174 health insurers, 10 percent of the insurer’s total liabilities;
175 (e) Notwithstanding paragraph (a) or paragraph (d), for a
176 domestic insurer that transacts residential property insurance
177 and is:
178 1. Not a wholly owned subsidiary of an insurer domiciled in
179 any other state, $30 $15 million.
180 2. A wholly owned subsidiary of an insurer domiciled in any
181 other state, $50 million;
182 (f) Notwithstanding paragraphs (a), (d), and (e), for a
183 domestic insurer that only transacts limited sinkhole coverage
184 insurance for personal lines residential property pursuant to s.
185 627.7151, $7.5 million; or
186 (g) Notwithstanding paragraphs (a), (d), and (e), for an
187 insurer that only transacts residential property insurance in
188 the form of renter’s insurance, tenant’s coverage, cooperative
189 unit owner insurance, or any combination thereof, $10 million.
190 Section 5. Paragraphs (f) and (g) of subsection (1) of
191 section 624.408, Florida Statutes, are amended to read:
192 624.408 Surplus required; current insurers.—
193 (1) To maintain a certificate of authority to transact any
194 one kind or combinations of kinds of insurance, as defined in
195 part V of this chapter, an insurer in this state must at all
196 times maintain surplus as to policyholders at least the greater
197 of:
198 (f) For residential property insurers not holding a
199 certificate of authority before July 1, 2011, $30 $15 million.
200 (g) For residential property insurers holding a certificate
201 of authority before July 1, 2011, and until June 30, 2016, $5
202 million; on or after July 1, 2016, and until June 30, 2021, $10
203 million; on or after July 1, 2021, and until June 30, 2023, $15
204 million; on or after July 1, 2023, $30 million.
205
206 The office may reduce the surplus requirement in paragraphs (f)
207 and (g) if the insurer is not writing new business, has premiums
208 in force of less than $1 million per year in residential
209 property insurance, or is a mutual insurance company.
210 Section 6. Paragraph (a) of subsection (10) and subsection
211 (11) of section 624.424, Florida Statutes, are amended to read:
212 624.424 Annual statement and other information.—
213 (10)(a) Each insurer or insurer group doing business in
214 this state shall file on a quarterly basis in conjunction with
215 financial reports required by paragraph (1)(a) a supplemental
216 report on an individual and group basis on a form prescribed by
217 the commission with information on personal lines and commercial
218 lines residential property insurance policies in this state. The
219 supplemental report shall include separate information for
220 personal lines property policies and for commercial lines
221 property policies and totals for each item specified, including
222 premiums written for each of the property lines of business as
223 described in ss. 215.555(2)(c) and 627.351(6)(a). The report
224 shall include the following information for each county on a
225 monthly basis:
226 1. Total number of policies in force at the end of each
227 month.
228 2. Total number of policies canceled.
229 3. Total number of policies nonrenewed.
230 4. Number of policies canceled due to hurricane risk.
231 5. Number of policies nonrenewed due to hurricane risk.
232 6. Number of new policies written.
233 7. Total dollar value of structure exposure under policies
234 that include wind coverage.
235 8. Number of policies that exclude wind coverage.
236 9. Number of claims open each month.
237 10. Number of claims closed each month.
238 11. Number of claims pending each month.
239 12. Number of claims in which either the insurer or insured
240 invoked any form of alternative dispute resolution;, which party
241 invoked alternative dispute resolution; the pre-alternative
242 dispute resolution payment made by the insurer, if any; the
243 post-alternative dispute resolution payment made by the insurer,
244 if any; and the specifying which form of alternative dispute
245 resolution was used.
246 (11) Beginning January 1, 2022, each authorized insurer or
247 insurer group issuing personal lines or commercial lines
248 residential property insurance policies in this state shall file
249 with the office on an annual basis in conjunction with the
250 statements required by paragraph (1)(a) a supplemental report on
251 an individual and group basis for closed claims. The office
252 shall compile the data for each insurer or insurer group on a
253 statewide basis and make such data publicly available on its
254 website monthly. Such data, when aggregated on a statewide basis
255 as to an individual insurer or insurer group, is not a trade
256 secret as defined in s. 688.002 or s. 812.081(1) and is not
257 subject to the public records exemption for trade secrets
258 provided in s. 119.0715. By January 1, 2024, the office shall
259 also make publicly available the data required to be reported by
260 each insurer or insurer group for the 2021 calendar year, the
261 2022 calendar year, and the 2023 calendar year through July 1,
262 2023, and collected by the office during the 2022 calendar year
263 and subsequent years. The report must be on a form prescribed by
264 the commission and must include the following information for
265 each claim closed, excluding liability only claims, within the
266 reporting period in this state:
267 (a) The unique claim identification number.
268 (b) The type of policy.
269 (c) The zip code of the property where the claim occurred.
270 (d) The county where the claim occurred.
271 (e) The date of loss.
272 (f) The peril or type of loss, including information about:
273 1. The types of vendors used for mitigation, repair, or
274 replacement; and
275 2. The names of vendors used, if known.
276 (g) The date the claim was reported to insurer.
277 (h) The initial date the claim was closed, including
278 information about whether the claim was closed with or without
279 payment.
280 (i) The date the claim was most recently reopened, if
281 applicable.
282 (j) The date a supplemental claim was filed, if applicable.
283 (k) The date the claim was most recently closed, if
284 different from the initial date the claim was closed.
285 (l) The name of the public adjuster on the claim, if any.
286 (m) The Florida Bar number and name of the attorney for the
287 claimant, if any.
288 (n) The t