2019 Summary Of Legislation Passed

CS/CS/CS/HB 301 — Insurance by Commerce Committee; Civil Justice Subcommittee; Insurance and Banking Subcommittee; and Rep. Santiago (CS/CS/CS/CS/SB 714 by Appropriations Committee; Banking and Insurance Committee; Judiciary Committee; Banking and Insurance Committee; and Senators Brandes and Bracy) The bill provides, in part:

  • Increases from 5 percent to 10 percent the amount of loss adjustment expenses covered by the Florida Hurricane Catastrophe Fund for contracts effective on or after June 1, 2019.

  • Provides that beginning January 1, 2020, a liability insurer who defends an insured will have the right to compel the sharing of defense costs by another insurer who also owes a duty to defend the insured on the same claim.

  • Provides that notice of a bad faith claim may not be filed within 60 days after appraisal has been invoked by a party in a residential property insurance claim.

  • Deletes a provision allowing the Department of Financial Services to return a pre-suit notice for a bad faith action if the notice lacks specific information.

  • Allows a foreign or alien insurer to operate in Florida without first having 3 years of experience if the Office of Insurance Regulation has determined the insurer possesses sufficient capital and surplus to support its plan of operation.

  • Provides that a residential structure with a dwelling replacement cost of $700,000 or more may be exported to a surplus lines insurer if an agent seeks coverage from one authorized insurer and is rejected.

  • Removes the $35 limit on the per-policy fee a surplus line agent may charge for each policy certified for export to a surplus lines insurer and allows retail agents to charge a similar uncapped fee for placing a surplus lines policy. Both fees must be reasonable and must be itemized separately to the customer before purchase.

  • Exempts insurers from certain restrictions in unfair methods of competition when providing services or other merchandise, goods, wares, or items of value that relate to loss control or loss mitigation with respect to the risks covered under the policy to the insured for free or at a discounted price.

  • Allows an insurer to offer a multiline discount to the insured when policies from insurers operating under a joint marketing agreement are purchased, when a policy is removed from Citizens Property Insurance Corporation through the policyholder eligibility clearinghouse program, or when the same agent is servicing the policies from different insurers.

  • Allows the notice of mediation to be given at the time a property insurance policy is issued and renewed or after a first party property claim has been filed.

CS/HB 617 — Homeowners’ Insurance Policy Disclosures by Insurance and Banking Subcommittee and Reps. Newton, Joseph, and others (CS/SB 380 by Banking and Insurance Committee and Senator Brandes)

  • The bill requires an insurer issuing a homeowners insurance policy that does not provide for the coverage of flood must provide a prescribed statement informing the policyholder that their policy does not insure against losses caused by flood. Such statement must be provided to the policyholder at issuance and renewal.

CS/CS/HB 7065 — Insurance Assignment Agreements by Judiciary Committee; Insurance and Banking Subcommittee; Civil Justice Subcommittee; and Rep. Rommel and others (CS/CS/CS/SB 122 by Rules Committee; Judiciary Committee; Banking and Insurance Committee; and Senators Broxson, Hooper, Simmons, and Stewart) 

  • The bill addresses issues arising from the assignment of post-loss benefits from property insurance policies. The bill eliminates the “one way” attorney fee for assignees.

  • The bill requires the assignee to give notice prior to filing a lawsuit and make a presuit demand. The insurer must respond with a presuit settlement offer. The court must compare the difference between the demand and the offer with the judgment obtained and award attorney fees based on a formula that provides that if the difference between the judgment obtained by the assignee and the presuit settlement offer is: Less than 25 percent of the disputed amount, the insurer is entitled to an award of reasonable attorney fees. At least 25 percent but less than 50 percent of the disputed amount, no party is entitled to an award of attorney fees. At least 50 percent of the disputed amount, the assignee is entitled to an award of reasonable attorney fees.

  • The bill allows insurers to make available a property insurance policy that prohibits or restricts the assignment of post-loss benefits. If an insurer offers a policy that prohibits or restricts assignments of post-loss benefits, it must offer a policy with the same coverage that does not restrict or prohibit the right to assign benefits. When purchasing a policy that prohibits or restricts assignments of post-loss benefits, the named insured must reject the fully assignable policy. Policies prohibiting or restricting assignment of benefits must be at a lower cost.

  • The bill requires assignees to comply with some of the policyholder’s duties under the insurance policy. Insurance policies generally require insureds to cooperate with the claims investigation, sit for examinations under oath by the insurance company, and participate in appraisal. This bill applies those duties to the assignees as well.

  • The bill gives the insured 14 days to rescind the assignment.

  • Gives the insured 30 days to rescind the assignment if the assignee has not begun substantial work during that 30 days.

  • Requires the assignee to provide a copy of the assignment agreement to the insurance company within 3 days.

  • Limits assignments of benefits to $3,000 or 1 percent of Coverage A during emergencies.

  • Prohibits assignee from charging fees or penalties for mortgage processing, rescission or cancellation of the agreement, or administrative fees to insureds.

  • Limits the ability of assignees to collect payment from insureds.

  • Requires insurers to report information about assignments to the Office of Insurance Regulation.

  • Provides that Citizens Property Insurance Corporation cannot implement rate changes unless the rate filing reflects projected savings from the bill.

HB 7091 — OGSR/Hurricane and Flood Loss Model Trade Secrets by Oversight, Transparency and Public Management Subcommittee and Rep. Fischer (SB 7054 by Banking and Insurance Committee)

 The bill continues the current exemption from public records disclosure for trade secrets used in designing and constructing hurricane and flood loss models that are provided by a private company to the Florida Commission on Hurricane Loss Projection Methodology, the Office of Insurance Regulation, or the Office of the Consumer Advocate. The bill also continues the public meetings exemption for those portions of a meeting by the methodology commission or a rate filing by an insurer in which trade secrets pertaining to hurricane or flood models are discussed.