HB 387 — Nonadmitted Insurance Markets

F L O R I D A H O U S E O F R E P R E S E N T A T I V E S HBCS/HB 387 2019 A bill to be entitled An act relating to nonadmitted insurance markets;

revisingamending thess. tax rate of certain surplus lines policies;

amending626.935 s.and 629.401, F.S.;

626.935, F.S.;

providing an effective dates.date.

626.916 Eligibility for export.— (4) A reasonable per-policy fee, not to exceed $35, may be charged by the filing surplus lines agent for each policy Page 1 of 5 CODING:

hb0387-00hb0387-01-c1 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S HBCS/HB 387 2019 charged by the filing surplus lines agent for each policy certified for export.

Subsections (1),(3) (2),through and(6) (5) of section 626.931, Florida Statutes, are renumbered as subsections (1) through (4), respectively, and present subsections (1), (2), and (5) of that section are amended to read:

EffectiveParagraph January 1, 2020, paragraph (a) of subsection (2) and subsection (3) of section 626.932, Florida Statutes, are amended, and subsection (1) of that section is republished,amended to read:

626.932 Surplus lines tax.— Page 2 of 5 CODING:

hb0387-00hb0387-01-c1 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S HBCS/HB 387 2019 626.932(2)(a) SurplusThe surplus lines tax.—agent (1)shall Themake premiumspayable chargedto forthe surplusdepartment linesthe coveragestax arerelated subjectto each calendar quarter's business as reported to athe premiumFlorida receiptsSurplus Lines Service Office, and remit the tax ofto 5the percentFlorida ofSurplus allLines grossService premiumsOffice chargedat the same time as the fee payment required provided for suchthe insurance.filing of the quarterly affidavit, under s.

The surplus lines agent shall collect from the insured the amount of the tax at the time of the delivery of the cover note, certificate of insurance, policy, or other initial confirmation of insurance, in addition to the full amount of the gross premium charged by the insurer for the insurance.

The surplus lines agent is prohibited from absorbing such tax or, as an inducement for insurance or for any other reason, rebating all or any part of such tax or of his or her commission.

(2)(a) The surplus lines agent shall make payable to the department the tax related to each calendar quarter's business as reported to the Florida Surplus Lines Service Office under s.

626.931, and remit the tax to the Florida Surplus Lines Service Office on or before the 45th day following each calendar quarter and at the same time as the remittance of fees and interest required provided for the filing of the quarterly affidavit, under s.

The Florida Surplus Lines Service Office shall forward to the department the taxes and any interest collected pursuant to paragraph (b), within 10 days after of receipt.

(3) If a surplus lines policy covers risks or exposures only partially in this state and the state is the home state as Page 3 of 5 CODING:

Words stricken are deletions;

words underlined are additions.

hb0387-00 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S HB 387 2019 defined in the federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA), the tax payable must shall be computed on the gross premium.

The surplus lines policy shall be taxed in accordance with subsection (1) unless the policyholder chooses to be taxed at The tax must not exceed the tax rate where the risk or exposure is located.

627.715 Flood insurance.—An authorized insurer may issue an insurance policy, contract, or endorsement providing personal lines residential coverage for the peril of flood or excess coverage for the peril of flood on any structure or the contents ofPage personal3 propertyof contained5 therein,CODING: subject to this section.

This section does not apply to commercial lines residential or commercial lines nonresidential coverage for the peril of flood.

Page 4 of 5 CODING:

hb0387-00hb0387-01-c1 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S HBCS/HB 387 2019 Anof insurerpersonal mayproperty issuecontained floodtherein, insurancesubject policies,to contracts,this endorsements,section. or excess coverage on a standard, preferred, customized, flexible, or supplemental basis.

This section does not apply to commercial lines residential or commercial lines nonresidential coverage for the peril of flood.

An insurer may issue flood insurance policies, contracts, endorsements, or excess coverage on a standard, preferred, customized, flexible, or supplemental basis.

ExceptParagraph as(a) otherwiseof expresslysubsection provided(1) inof thissection act,629.401, thisFlorida actStatutes, shallis takeamended effectto Julyread: 1, 2019.

629.401 Insurance exchange.— (1) There may be created one or more insurance exchanges, with one or more offices each, subject to such rules as are adopted by the commission.

For the purposes of this section, the Page 4 of 5 CODING:

Words stricken are deletions;

words underlined are additions.

hb0387-01-c1 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S CS/HB 387 2019 term "exchange" applies to any such insurance exchange proposed or created under this section.

The purposes of the exchange are:

(a) To provide a facility for the underwriting of:

1.

Reinsurance of all kinds of insurance.

2.

Direct insurance of all kinds on risks located entirely outside the United States.

3.