SB 742 — Insurance

3. The degree of competition among insurers for the risk insured.

4. Investment income reasonably expected by the insurer, consistent with the insurer’s investment practices, from investable premiums anticipated in the filing, plus any other expected income from currently invested assets representing the amount expected on unearned premium reserves and loss reserves.

The commission may adopt rules using reasonable techniques of actuarial science and economics to specify the manner in which insurers calculate investment income attributable to classes of insurance written in this state and the manner in which investment income is used to calculate insurance rates.

Such manner must contemplate allowances for an underwriting profit factor and full consideration of investment income that produces a reasonable rate of return;

however, investment income from invested surplus may not be considered.

5. The reasonableness of the judgment reflected in the filing.

6. Dividends, savings, or unabsorbed premium deposits allowed or returned to policyholders, members, or subscribers in this state.

7. The adequacy of loss reserves.

8. The cost of reinsurance.

The office may not disapprove a rate as excessive solely due to the insurer having obtained catastrophic reinsurance to cover the insurer’s estimated 250 year probable maximum loss or any lower level of loss.

9. Trend factors, including trends in actual losses per insured unit for the insurer making the filing.

10. Conflagration and catastrophe hazards, if applicable.

11. Projected hurricane losses, if applicable, which must be estimated using a model or method found to be acceptable or reliable by the Florida Commission on Hurricane Loss Projection Methodology, and as further provided in s.

197A Theresidential provisionsproperty ofinsurance thisrate subsectionfiling domay notuse applya toweighted workers’or compensation,straight employer’saverage liabilityof insurance,two andor motormore vehiclesuch insurance.models or methods.

Section12. Projected 6. Paragraphflood (b)losses offor subsectionpersonal (2)residential ofproperty sectioninsurance, 627.0629,if Floridaapplicable, Statutes,which ismay amended,be andestimated subsectionusing (9)a ismodel addedor tomethod, thator section,a straight average of model results or output ranges, independently found to read:be acceptable or reliable by the Florida Commission on Hurricane Loss Projection Methodology and as further provided in s.

627.0628.

13. A reasonable margin for underwriting profit and contingencies.

14. The cost of medical services, if applicable.

15. Other relevant factors that affect the frequency or severity of claims or expenses.

296 The provisions of this subsection do not apply to workers’ compensation, employer’s liability insurance, and motor vehicle insurance.

Section 8. Paragraph (b) of subsection (2) of section 627.0629, Florida Statutes, is amended, and subsection (9) is added to that section, to read:

(9) An insurer may file with the office a personal lines residential property insurance rating plan that provides justified premium discounts, credits, or other rate differentials based on windstorm mitigation construction standards developed by an independent, not-for-profit, scientific research organization.organization, if such standards meet the requirements of this section.

Section 7. Subsection9. Subsection (1) of section 627.072, Florida Statutes, is amended to read:

Section 8. Paragraph10. Paragraph (a) of subsection (6) of section 627.351, Florida Statutes, is amended to read:

354454 The requirements of sub-subparagraphs b.-d.

Section 9. Effective11. Subsection upon(6) thisis actadded becomingto a law, subsections (1), (2), and (4) of section 627.444,627.421, Florida Statutes, are amended, and subsections (7) and (8) are added to that section, to read:

627.421 Delivery of policy.— (6) If a policy is sold in a wholly electronic manner, the insurer may electronically transmit all policy documents and claims communications to the insured or policyholder so long as the insurer provides a disclosure to the insured or policyholder at the time of sale.

Section 12. Effective upon this act becoming a law, subsections (1), (2), and (4) of section 627.444, Florida Statutes, are amended, and subsections (7) and (8) are added to that section, to read:

(a) “Loss run statement” means a report that contains the policy number, the period of coverage, the number of claims, the paid losses on each claim all claims, and the date of each loss.

Section 10. Section13. Section 627.6647, Florida Statutes, is repealed.

Section 11. Paragraph14. Paragraph (b) of subsection (1) and subsection (3) of section 627.7011, Florida Statutes, areis amended to read:

462570 An insurer is not required to make the offers required by this subsection with respect to the issuance or renewal of a homeowner’s policy that contains the provisions specified in paragraph (b) for law and ordinance coverage limited to 25 percent of the dwelling limit, except that the insurer must offer the law and ordinance coverage limited to 50 percent of the dwelling limit.

(3) InSection the15. Effective eventupon ofthis act becoming a losslaw, forpresent whichsubsections a(4) dwellingthrough or(10) personalof propertysection is627.715, insuredFlorida onStatutes, theare basisredesignated ofas replacementsubsections costs:(5) through (11), respectively, and a new subsection (4) is added to that section, to read:

(a) For a dwelling, the insurer must initially pay at least the actual cash value of the insured loss, less any applicable deductible.

The insurer shall pay any remaining amounts necessary to perform such repairs as work is performed and expenses are incurred.

The insured has not less than 2 years from the date of loss or 1 year from the notice of the claim, whichever occurs later, to request reimbursement from the insurer for work to be performed and expenses incurred.

If a total loss of a dwelling occurs, the insurer shall pay the replacement cost coverage without reservation or holdback of any depreciation in value, pursuant to s.

627.702.

(b) For personal property:

1. The insurer must offer coverage under which the insurer is obligated to pay the replacement cost without reservation or holdback for any depreciation in value, whether or not the insured replaces the property.

2. The insurer may also offer coverage under which the insurer may limit the initial payment to the actual cash value of the personal property to be replaced, require the insured to provide receipts for the purchase of the property financed by the initial payment, use such receipts to make the next payment requested by the insured for the replacement of insured property, and continue this process until the insured remits all receipts up to the policy limits for replacement costs.

The insured has not less than 2 years from the date of loss or 1 year from the notice of the claim, whichever occurs later, to request reimbursement from the insurer for expenses incurred.

The insurer must provide clear notice of this process before the policy is bound.

A policyholder must be provided an actuarially reasonable premium credit or discount for this coverage.

The insurer may not require the policyholder to advance payment for the replaced property.

Section 12. Effective upon this act becoming a law, present subsections (4) through (10) of section 627.715, Florida Statutes, are redesignated as subsections (5) through (11), respectively, and a new subsection (4) is added to that section, to read:

Section 13. Effective16. Effective upon this act becoming a law, paragraph (b) of subsection (1) and paragraph (a) of subsection (9) of section 627.7152, Florida Statutes, are amended to read:

The term does not include fees collected by a public adjuster as defined in 626.854.

Section 14. Section17. Section 634.171,627.7276, Florida Statutes, is amended to read:

627.7276 Notice of limited coverage.— (1) An automobile policy that does not contain coverage for bodily injury and property damage must include a notice be clearly stamped or printed to the effect that such coverage is not included in the policy in the following manner:

639 “THIS POLICY DOES NOT PROVIDE BODILY INJURY AND PROPERTY DAMAGE LIABILITY INSURANCE OR ANY OTHER COVERAGE FOR WHICH A SPECIFIC PREMIUM CHARGE IS NOT MADE, AND DOES NOT COMPLY WITH ANY FINANCIAL RESPONSIBILITY LAW.” 645 (2) This notice legend must accompany appear on the policy declaration page and on the filing back of the policy and be printed in a contrasting color from that used on the policy and in type and larger than the largest type used in the text at least as large as the type and text used on the declarations page thereof, as an overprint or by a rubber stamp impression.

Section 18. Section 634.171, Florida Statutes, is amended to read:

Section 15. Section19. Section 634.317, Florida Statutes, is amended to read:

Section 16. Section20. Section 634.419, Florida Statutes, is amended to read:

Section 17. Effective21. Effective upon this act becoming a law, for the purpose of incorporating the amendment made by this act to section 627.7152, Florida Statutes, in references thereto, subsection (1) and paragraph (d) of subsection (2) of section 627.7153, Florida Statutes, are reenacted to read:

625721 THIS POLICY DOES NOT ALLOW THE UNRESTRICTED ASSIGNMENT OF POST-LOSS INSURANCE BENEFITS.

Section 18. Except22. Except as otherwise expressly provided in this act,act and except for this section, which shall take effect upon this act becoming a law, this act shall take effect July 1, 2021.