Florida Seeks Help to Quicken Approval of Insurer Forms

Jul 3, 2012

The following article was published in the Insurance Journal on July 5, 2012:

Florida Seeks Help to Quicken Approval of Insurance Forms

By Michael Adams


Florida regulators are looking to fast track the approval of changes in insurance company property policy forms and coverages after building up a significant backlog due to the numerous law changes enacted in the past two years.

As a result of legislative changes affecting commercial lines and personal lines regulation, including a sinkhole reform law, the Office of Insurance Regulation (OIR) has been inundated by insurers seeking approval of policy forms.

However, the OIR says it is understaffed due to budget cuts made by state lawmakers. And with the number of form filings expected to jump by 22 percent this year, the stress on the department has officials calling for more help.

Insurance Commissioner Kevin McCarty highlighted the problem last week during a presentation before Gov. Rick Scott and other officials. He said that while the OIR could use some updated technology to help process the forms, but what OIR really needs is more workers.

“Some of our staff has a workload of 250 to 300 filings and they burn out,” said McCarty. “If I had more money, I could hire more people to do more.”

How bad is the problem?

Regulators have repeatedly asked insurers for extensions and in some cases insurers are waiting more than four months to have their forms approved as opposed to the 30 days as required by law.

In an effort to streamline the approval process, McCarty recently sent out an order that gave insurance executives the option of using forms by certifying they meet state laws, rules, and court decisions instead of awaiting a full review by regulators.

“Due to the volume of filings and the agencies resource limitations, the review of approval of policyholder forms is not practicable where the form at issue has been diligently and thoroughly reviewed by the company,” read the order, which will be effective for one year.

In the event the insurer files a certification that does not meet the standards outlined in the order, the OIR retains the ability to withdraw the form changes and institute a full regulatory review.

McCarty said that the order is just one way regulators are trying to speed up the process. But it remains to be seen how many insurers will take advantage of the process. According to the OIR, out of the 1,200 form changes requested by commercial insurers, only 79 have taken the certification route.

McCarty said insurers are wary of the process since the certification also carries with it the legal obligation to take into effect court decisions that have affected the forms.

 View the original article here:  http://www.insurancejournal.com/news/southeast/2012/07/03/254269.htm