House Insurance Committee Activity: Mar. 6
Mar 7, 2008
On March 6, 2008, several legislative proposals relating to insurance were considered by Florida House of Representatives Committees.
The House Insurance Committee passed House Bill 269 by Representative Alan Hays (R-Umatilla) relating to Hurricane Preparedness and Insurance and House Bill 375 by Representative Dorothy Hukill (R-Port Orange) relating to Insurable Interests.
The House Jobs and Entrepreneurship Council passed House Bill 343 relating to Financial Institutions by Representative Jennifer Carroll (R- Jacksonville).
HB 269 passed the House Insurance Committee with a strike-everything amendment that made the bill nearly identical to SB 2498, a related bill that passed during the 2007 Regular Session. The amendment, which removed the provisions in HB 269 relating to the building code, creates a Citizens Property Insurance Corporation (“Citizens”) Mission Review Task Force and requires Citizens to assist the Task Force. The bill also requires Florida’s Chief Financial Officer (“CFO”) to annually report to the Governor and Legislative presiding officers on the economic impact to the State of a 1-in-100 year event rather than a 1-in-250 year event and effects revisions to the Task Force, such as increasing the number of members to 19.
Representative Janet Long (D- St. Petersburg) expressed concerns with HB 269, primarily that adding an additional expense to Citizens (which is currently operating at a deficit) is counterproductive. She also noted that the management of Citizens should be governed by the CFO’s office. The bill passed without public testimony and next goes to the House Jobs and Entrepreneurship Council.
HB 375 passed the House Insurance Committee with one amendment. The Bill establishes that proceeds from a life, health or disability insurance policy must be paid to the person who is the subject of the insurance policy, or to another person with a close relationship to the insured, such as a family member, affiliated business, or parties to a contract involving the insured. The amendment clarifies the concept of insurable interest, permits businesses to insure key persons with the insured’s consent, and clarifies conditions for fiduciaries to have an insurable interest life insurance policy.
Representatives Carl Domino (R- Juno Beach) and Priscilla Taylor (D- Riviera Beach) had some concerns with HB 375. Representative Domino was concerned that the Bill could allow some charitable organizations, that are currently not authorized, to now be able to purchase insurance on an individual. Representative Taylor was concerned that certain adults can take out life insurance policies on other adults (ie: husband and wife) without the consent of the insured. Representatives of the Florida Bar and American Council of Life Insurers spoke in favor of the bill as amended. The bill passed with Representative Taylor as the lone “no” vote. HB 375 next goes before the House Jobs and Entrepreneurship Council.
HB 343 passed with one amendment. The Bill creates a new insurance product that enables insurers to directly insure banks and other entities against losses resulting from the writing of debt cancellation or debt suspension agreements. Office of Insurance Regulation General Counsel Steve Parton spoke on the Bill, noting that this new product could be subject to assessments by the Florida Insurance Guarantee Association, Inc. and that this ambiguity should be addressed in the Bill. HB 343 next goes before the House Policy and Budget Council.
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