Senate Banking and Insurance Committee Amends, Passes Insurance Omnibus Bill

Apr 7, 2009

The Florida Senate Banking and Insurance Committee (“Committee”) met in Tallahassee Florida on April 6, 2009 and considered several insurance-related bills.  The following is a brief summary of the discussion and actions that took place during the meeting on those bills.


Senate Bill 1950 by Senator Garrett Richter (R-Naples) relating to Insurance

SB 1950 is the omnibus insurance bill that amends the laws relating to Citizens Property Insurance Corporation (“Citizens”), the Florida Hurricane Catastrophe Fund (“FHCF”) and other provisions of Florida’s insurance code. 

Committee Chairman Richter briefly explained SB 1950, noting that it had been thoroughly discussed during the previous Banking and Insurance Committee meeting, during which the bill was temporarily passed. 

The Committee considered the following amendments to SB 1950:

  • An amendment by Senator Mike Fasano (R- New Port Richey) that would extend the Citizens rate freeze through 2009 failed by a vote of 5-2.  Senators Fasano and Ronda Storms were the strongest advocates for this amendment.  Chairman Richter noted that freezing rates is not a good policy for Florida.
  • An amendment by Senator Fasano conforming parts of SB 1950 to the Citizens rate freeze was withdrawn.
  • An amendment by Senator Al Lawson (R-Tallahassee) to remove the provision authorizing the Florida State Board of Administration (“SBA”) to purchase bonds from the FHCF was adopted without objection.  Chairman Richter noted that the amendment was “friendly” because the language was “permissive.”
  • An amendment by Chairman Richter that would coverage charges and surcharges from calculation in a rate increase was adopted without objection.
  • An amendment by Chairman Richter stating that the optional coverage retention in the FHCF would be accessed before the mandatory coverage under the FHCF Reimbursement Contract passed without objection or discussion. 
  • An amendment by Chairman Richter that would change the bonding estimate date for the FHCF from June to May passed without objection.
  • An amendment by Chairman Richter that would change SB 1950’s effective date from July 1, 2009 to June 1, 2009 passed without objection.
  • An amendment by Chairman Richter that would conform the FHCF claims paying capacity to the extension of the Temporary Increase in Coverage Limits (“TICL”) passed without objection.
  • An amendment by Senator Fasano that would eliminate a provision to allow an insurer to adjust its annual rate filing in an amount equal to the inflation trend factor or five percent was adopted without objection.
  • An amendment by Senator Fasano that would eliminate a provision requiring windstorm mitigation ratings to be disclosed by the seller of residential property was adopted without objection. 

The Committee took public testimony following the amendatory process.  A representative from Associated Industries of Florida (“AIF”) spoke in favor of SB 1950 on behalf of the business community. 

A very heated discussion took place between the AIF representative and Senator Fasano regarding assessments and Florida’s general insurance public policies.  The AIF representative emphatically noted that rates have been politically suppressed and thus have created a huge and unfair financial burden on the business community. 

During the exchange, Senator Fasano noted that the AIR representative had “no clue” and was “out of touch” with Floridians.  Senator Storms also noted that, considering today’s economic climate, Floridians cannot afford higher premiums. 

Senator J.D. Alexander (R-Winter Haven) commented that, given the current economy, the State is in financial peril.  He noted that Florida must move to a market where its people can rely on their insurance company to pay claims in the event of a loss. 

Chairman Richter closed on SB 1950 by noting the bill is intended to “stop the digging” of a financial hole that has been created in recent years.  

Following the discussion, SB 1950 passed 7-1 as amended.  Senator Storms was the lone “no” vote.


The following insurance-related bills also were considered and acted upon by the Committee:


Senate Bill 2078 by Senator Charlie Justice (D-St. Petersburg) relating to the My Safe Florida Home Program

A strike-everything amendment was adopted to SB 2078, which amends several provisions of the My Safe Florida Home Program.  As amended, the bill would revise criteria for mitigation inspections and grants, and expands the list of improvements for which grants can be used.  SB 2078 deletes provisions relating to no-interest loans, implements a condominium mitigation loan program, revises entities authorized to certify uniform mitigation inspection forms, authorizes insurers to contract with inspection firms at the insurers expense, and provides criminal penalties for submitting false forms.

SB 2078 passed unanimously as amended.


Senate Bill 2036 by Senator Mike Bennett (R-Bradenton) relating to Residential Property Insurance

SB 2036 was considered with only a few minutes remaining in the Committee meeting. As amended, the bill would authorize certain insurers to use rates that are in excess of filed and approved rates with the Florida Office of Insurance Regulation.  Insurers using unapproved rates must have a minimum surplus of $500 million, or have net written premium-to-surplus not exceed 2-1.  Such insurers would not be eligible to purchase the TICL coverage.

SB 2036 passed 6-2 as amended.


Senate Bill 1122 by Senator Don Gaetz (R-Niceville) relating to Health/Payment of Benefits/Claims Forms

Among other provisions, SB 1122 would require that an insurer make a payment to the designated provider of services whenever an insured, using any health insurance claim form, specifically authorizes payments of benefits directly to any recognized hospital, licensed ambulance provider, physician, dentist, or other person who provided the services in accordance with the provisions of the policy.

SB 2036 passed 8-0 as amended.


Senate Bill 444 by Senator Bennett relating to Title Insurance was on the Committee agenda, but not considered.


Should you have any questions or comments, please contact Colodny Fass.


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