Florida Hurricane Catastrophe Fund Reviews Proposed Rule Revisions to Reimbursement Premium Formula, Insurer Responsibilities and Reporting Requirements for 2013/2014 Contract Year
Jan 8, 2013
The Florida Hurricane Catastrophe Fund (“FHCF”) held a Rule Development Workshop today, January 8, 2013, to discuss proposed changes to Rules 19-8.028, 19-8.029 and 19-8.030 pertaining to insurer exposure and loss reporting requirements for the 2013/2014 FHCF Contract Year, FHCF reimbursement premium formula requirements and insurer responsibilities
The presiding FHCF panel also heard a presentation from Paragon Strategic Solutions relating to wind mitigation factors in FHCF rate-making. The company recommended capping mitigation credits at 50 percent. Specifically, an initial cap of 30 percent would be incorporated for 2013 and increase annually until the cap reaches 50 percent.
To view the presentation, click here.
The FHCF reimbursement rate for 2013-2014 will be set this spring. Today, only changes to Rule 19-8.028 (Reimbursement Premium Formula) were discussed.
Paragraph 3(b)-(f) of Rule 19-8.029 is being deleted because it is now obsolete. The provisions of paragraph 4 (c) (3) (b-c) that allowed new FHCF participants to report exposure as of November 30 by February 1 of the FHCF Contract Year will be re-adopted and made permanent. The proposed Rule is also being amended to exempt policies that predominately cover fine art from the FHCF.
Paragraphs 4(a) – (e) and 7(b)-(g) of Rule 19-8.029 (Data Call) will be deleted because they are obsolete. Paragraph 5(c) will be amended to create a new Proof of Loss form and instructions for submitting it.
Further, the 2013 FHCF Data Call Instruction Sheet will be amended to remove unnecessary data requests. Total insured risk will be divided into three categories:
- Reportable exposure
- Non-reportable, but covered exposure
- Non-covered exposures.
Reporting exposure relating to Citizens Property Insurance Corporation (“Citizens”) takeouts will be required to be adjusted for any policies that return to Citizens.
An additional page will be added to the FHCF Data Call for Citizens, which will be required to submit specific data relating to policies that provide a “Coverage A” limit of liability that is less than 80 percent of the replacement costs. Most of these changes were characterized during today’s Workshop as having already been implemented in the FHCF Contract.
Rule 19-8.030 paragraph 5 (c) will be amended to reflect the allowance for new FHCF participants to report exposure as of November 30 by February 1 of the FHCF Contract Year. Other obsolete language also will be deleted.
Click here to access the complete texts of the proposed Rules.
Should you have any questions or comments, please contact Colodny Fass& Webb.
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