On May 28, 2008, Florida Governor Charlie Crist signed an omnibus property insurance reform bill titled the “Homeowner’s Bill of Rights Act.” Effective July 1, 2008, the Act addresses a number of Florida’s increasing property insurance problems with the following revisions and additions to Florida’s insurance statutes:
- An extension of the hold on residential property insurance rates until January 1, 2010, by which time proposed increases must be filed and approved by the Office of Insurance Regulation (OIR) as actuarially sound.
- An increase of the cap from $1,000,000 to $2,000,000 on residential properties eligible for property insurance through the Citizens Property Insurance Corporation (CPIC), Florida’s insurer of last resort.
- An extension until December 31, 2009 of the requirement that all proposed property insurance rate increases be filed and approved prior to use. An exception is provided where the OIR fails to act on the filing within 90 days, in which case the insurer may use the proposed rate filed prior to approval.
- Repeal of provisions allowing arbitration panels to resolve rate disputes between insurers and the OIR; expedited hearings on rate filings requiring a hearing within 30 days after an insurer’s request, and an order by the administrative judge within 30 days of the hearing.
- A requirement that any insurer seeking to non-renew more than 10,000 policies within a twelve month period must notify the OIR at least 90 days prior to the issuance of non-renewal notices.
- Increased fines for violation of certain state unfair competition, unfair or deceptive acts or practices relating to insurance, and unfair claims handling practices laws, including fines up to as much as $200,000 for certain violations (from a previous maximum of $100,000).
- Authorizing the OIR to require an insurer to file its claims handling practices and procedures as a public record based on findings of a market conduct examination.
- New requirements for underwriting methods pertaining to hurricane prediction models.
- The creation of a Task Force to develop a report setting forth proposed changes needed to return CPIC to its former role as a state-created, noncompetitive market mechanism providing property insurance coverage to risks that are otherwise uninsurable in the private insurance market, which report must be submitted by January 31, 2009.