SB 846 — Risk Retention Groups

Florida Senate - 2024 CS for SB 846 By Senatorthe DiCeglieCommittee 18-00549-24on 2024846__Banking Aand billInsurance; to be entitled An act relating to risk retention groups;

and Senator DiCeglie 597-02155-24 2024846c1 A bill to be entitled An act relating to risk retention groups;

627.944,324.021, F.S.;

providingrevising thatthe certaindefinition riskof retentionthe groupsterm are“motor deemedvehicle liability policy” to beinclude insurancepolicies companiesof authorizedliability toinsurance doissued businessby incertain thisrisk state;retention groups;

making technical changes;

SectionSubsection 627.944,(8) of section 324.021, Florida Statutes, is amended to read:

627.944324.021 RiskDefinitions; retention groups not certificated in this state.—Risk retention groups certificated or licensed in states other than this state and seeking to do business as a risk retention group in this state are deemed to be insurance companies authorized to do business in this state and must observe and abide by the laws of this state as follows:

(1)minimum NOTICEinsurance OFrequired.—The OPERATIONSfollowing ANDwords DESIGNATIONand OFphrases CHIEFwhen FINANCIALused OFFICERin ASthis AGENT.—Beforechapter offeringshall, insurancefor inthe thispurpose state,of athis riskchapter, retentionhave groupthe mustmeanings shallrespectively submitascribed to them in this section, except in those instances where the office:context clearly indicates a different meaning:

(a)(8) AMOTOR statementVEHICLE identifyingLIABILITY thePOLICY.—Any stateowner’s or statesoperator’s inpolicy whichof the risk retention group is certificated or licensed as a liability insurance company,furnished dateas ofproof certification or licensing, its principal place of business,financial andresponsibility suchpursuant other information, including information on its membership, as the office may require to verifys. that the risk retention group is qualified as a risk retention group under the provisions of this part.

(b)324.031, Ainsuring copysuch ofowner itsor planoperator ofagainst operationsloss orfrom aliability feasibilityfor studybodily injury, death, and revisionsproperty damage arising out of suchthe planownership, maintenance, or studyuse submittedof toa itsmotor statevehicle ofin Pagenot 1less ofthan 5the CODING:limits described in subsection (7) and conforming to the requirements of s.

324.151, issued by any insurance company authorized to do business in this state, including, but not limited to, a risk retention group operating in accordance with 15 U.S.C.

ss.

3901 et seq.

which conducts business in this state pursuant to s.

627.943 or s.

627.944.

The owner, registrant, or operator of a motor vehicle is exempt from providing such proof Page 1 of 2 CODING:

Florida Senate - 2024 CS for SB 846 18-00549-24597-02155-24 2024846__2024846c1 domicile;of financial responsibility if he or she is a member of the United States Armed Forces and is called to or on active duty outside this state or the United States, or if the owner of the vehicle is the dependent spouse of such active duty member and is also residing with the active duty member at the place of posting of such member, and the vehicle is primarily maintained at such place of posting.

provided,The however,exemption thatprovided theby provisionthis relatingsubsection toapplies theonly submissionas oflong aas planthe member of operationthe orarmed aforces feasibilityis studyon doessuch shallactive notduty applyoutside withthis respectstate to any line or classificationthe ofUnited liabilityStates insuranceand whichthe wasowner definedcomplies inwith the Productsecurity Liabilityrequirements Riskof Retentionthe Actstate of 1981posting beforeor October 27, 1986, and which was offered before such date by any riskpossession retention group which had been certificated or licensedterritory andof operatingthe forUnited notStates. less than 3 years before such date.

(c) A statement of registration which designates the Chief Financial Officer or her or his designee as its agent for the purpose of receiving service of legal documents of process.

(2) FINANCIAL CONDITION.—Any risk retention group doing business in this state must shall submit to the office:

(a) A copy of the group’s financial statement submitted to its state of domicile, which must shall be certified by an independent public accountant and contain a statement of opinion on loss and loss adjustment expense reserves made by a member of the American Academy of Actuaries or a qualified loss reserve specialist under criteria established by rule of the commission after considering any criteria established by the National Association of Insurance Commissioners.

(b) A copy of each examination of the risk retention group as certified by the insurance commissioner or public official conducting the examination.

(c) Upon request by the office, a copy of any audit performed with respect to the risk retention group.

(d) Such information as may be required to verify its continuing qualification as a risk retention group under the provisions of this part.

Page 2 of 5 CODING:

Words stricken are deletions;

words underlined are additions.

Florida Senate - 2024 SB 846 18-00549-24 2024846__ (3) TAXATION.—All premiums paid for insurance or coverages on risks located within this state to a risk retention group shall be subject to taxation at the same rate and subject to the same interest, fines, and penalties for nonpayment as that applicable to eligible surplus lines insurers.

Each agent utilized in any transaction shall report and pay the taxes for the premiums for risks which they have placed with or on behalf of a risk retention group not certificated in this state.

In the event that an agent fails to pay the tax, each risk retention group shall pay the tax for insured or covered risks located within this state.

Further, each risk retention group shall report all premiums paid to it for insured or covered risks located within this state.

(4) COMPLIANCE WITH UNFAIR CLAIM SETTLEMENT PRACTICES LAW.— Any risk retention group, its agents, and its representatives shall comply with the unfair claim settlement practices law of this state as set forth in s.

626.9541(1)(i).

(5) DECEPTIVE, FALSE, OR FRAUDULENT PRACTICES.—Any risk retention group shall comply with and be subject to the laws of this state regarding deceptive, false, or fraudulent acts or practices, including the provisions of part IX of chapter 626.

If the office seeks an injunction regarding conduct in violation of these laws, the injunction may be obtained from any Florida court of competent jurisdiction.

(6) EXAMINATION REGARDING FINANCIAL CONDITION.—Any risk retention group must submit to an examination by the office to determine its financial condition if the insurance commissioner of the jurisdiction in which the group is certificated or licensed has not initiated an examination or does not initiate Page 3 of 5 CODING:

Words stricken are deletions;

words underlined are additions.

Florida Senate - 2024 SB 846 18-00549-24 2024846__ an examination within 30 days after a request by the office.