Last week, both the Florida Senate and House passed legislation, Senate Bill 1894 and House Bill 853 respectively (the "Legislation"), to exempt surplus lines insurers entirely from the provisions of Chapter 627, except where specifically stated otherwise, which contains Florida's rate and form filing statutes. As previously discussed here, here and here, the Legislation was originally introduced in February 2009 to reverse the Florida Supreme Court’s holding in Essex Ins. Co. v. Zota, Case No. SC06-2031 (June 26, 2008) (“Zota”) and has been amended a few times prior to reaching its final form. In Zota, the Florida Supreme Court stated that the exemption for surplus lines insurers provided in Florida Insurance Code Section 627.021(2)(e) only applies to rate filings as contained in part 1 of Chapter 627, and not to Florida’s form filing statutes that are located in part 2 of Chapter 627.
The Legislation, if signed by the governor, will be retroactive to October 1, 1988. and will also create four new insurance statutes specifically applicable to surplus lines insurers regulating: (1) payment of premiums and claims; (2) information disclosures required to be provided to liability insurance claimants; (3) attorney’s fees; and (4) disclosures of insureds’ liability for policies with deductibles or co-pays. Additionally, the Legislation will require surplus lines insurers to add specific disclosure languages to policies stating that the insurer’s rates and forms are not approved by any Florida regulatory agency.