SB 496 — Insurance Guaranty Associations

Florida Senate - 2019 CS for SB 496 By Senatorthe RaderCommittee 29-01191-19on 2019496__Banking Aand billInsurance; to be entitled An act relating to insurance guaranty associations;

and Senator Rader 597-02676-19 2019496c1 A bill to be entitled An act relating to insurance guaranty associations;

631.576,626.8621, F.S.;

authorizing an employee of the Florida Insurance Guaranty Association toor authorizean certainemployee employeesof a guaranty association of another state to adjust losses for the association;Florida Insurance Guaranty Association if certain conditions are met;

requiring such authorization to be included in a contract;

revising therequirements assessmentsfor levied by the Office of Insurance Regulation in levying assessments on workers’ compensation insurers;

providing that an insurer’s direct written premium may not be reduced by certain amounts for the purposes of determining insurer assessments or policyholder surcharges;

revising requirements for remitting policy surcharges and assessments;

conforming cross-references;cross references;

revising the requirements for the insurers’ reconciliation reports to the Floridaassociation; Workers’ Compensation Insurance Guaranty Association;

2327 Be It Enacted by the Legislature of the State of Florida:

2529 Section 1. Section 631.576,626.8621, Florida Statutes, is created to read:

631.576 Guaranty626.8621 Adjustments by guaranty association employees;employees.— (1) An employee of the Florida Insurance Guaranty Association, created under part II of chapter 631, may adjust losses for the association if such employee holds, or has held within the past 10 years, licensure in this state which allows for the adjustment of such losses.

loss(2) An adjustment.employee of a guaranty association established by another state and whose insurance regulators are members of the National Association of Insurance Commissioners may adjust losses for the Florida Insurance Guaranty Association.

The Floridaauthorization Insurancefor Guarantysuch Associationemployees mayto authorizeadjust anlosses employeemust ofbe anyincluded statein guarantya associationcontract towith adjust losses for the Florida Insurance Guaranty Association pursuantand tothe thisemployee’s part.guarantee association or association’s authorized representative.

The Florida Insurance Guaranty Association shall contract only for employees of other state guaranty association’sassociations employeewho ismaintain notthe requiredappropriate toexperience beand licensedtraining asfor anadjusting adjuster;such claims.

however, the authorization for the guaranty association’s employee to adjust losses must be included in a contract between the Florida Insurance Guaranty Association and the guaranty association or the guaranty association’s authorized representative.

Assessments levied against insurers and self-insurance funds pursuant to this paragraph must be computed and levied on the basis of the full policy premium value on the net direct written premium amount as set forth in the state for workers’ compensation insurance without consideration of any applicable discount or credit for largedeductibles. deductibles or retrospectively rated policies.

InsurersAn andinsurer’s self-insurancedirect fundswritten mustpremium reportcalculated premiumsfor inthe compliancepurposes withof thisdetermining paragraph,the andinsurer’s theassessment associationor policyholder surcharge may auditnot thebe reports.reduced by any discount or credit for deductibles in a policy or by any premium adjustment to a retrospectively rated policy.

Insurers and self insurance funds must report premiums in compliance with this paragraph, and the association may audit the reports.

(c)(b) Member(c)(b) The insurersoffice shall collectlevy policyholderthe surcharges at a uniform surcharge percentage rate on newall and renewal policies issuedof and effective during the periodsame ofkind 12 months beginning on January 1, April 1, July 1, or Octoberline 1, whichever is the first day of the following calendar quarter as specifiedwere inconsidered an order issued by the office directingin insurersdetermining tothe pay an assessment toliability of the association.insurer.

Member insurers shall collect policyholder surcharges at a uniform percentage rate on new and renewal policies issued and effective during the period of 12 months beginning on January 1, April 1, July 1, or October 1, whichever is the first day of the following calendar quarter as specified in an order issued by the office directing insurers to pay an assessment to the association.

3. Insurers must submit a reconciliation report to the association within 120 days after the end of the 12-month assessment period and annually thereafter for a period of 2 3 years.