Thursday, January 26, 2012

Insurance "hodgepodge" bill approved by House subcommittee, week 3 of 2012 session

Over a dozen miscellaneous changes to the Insurance Code were approved in the first committee hearing on HB 1101. On Tuesday, January 24, the House Insurance & Banking Committee voted favorably on HB 1101 which contains revisions to property insurance, motor vehicle insurance, travel insurance, adjuster and agent license exams, commercial surplus lines disclosure, and reinsurance summary statements. A committee hearing has not yet been scheduled on the Senate companion bill, SB 1620.

A summary of the current House bill is provided below. 

Property Insurance
  • Notice of policy change - sinkhole coverage.  Would allow a “Notice of Change in Policy Terms” to be used to remove sinkhole coverage from a base property insurance policy.
  • Mediation of property insurance claims.  Would limit who can request statutory property insurance mediation to policyholders (as first-party claimants) and insurers.  If the Governor declares a state of emergency due to a hurricane, property insurance claims filed more than 36 months after the declaration would be ineligible for the property insurance mediation program.
  • Limited apportionment companies.  Would conform the definition of “limited apportionment company” to other changes in the Insurance Code.
  • Crop insurance.  Would prohibit production credit associations or federal land bank associations from paying any type of patronage dividend, credit, or discount to a policyholder relating to crop insurance.
Motor vehicle insurance
  • Salvage.  Would exempt a salvage motor vehicle dealer from having to carry garage liability or PIP insurance on vehicles that have been issued a certificate of destruction and that cannot be operated on the road.
  • Cancellation of auto policies for non-payment. Would allow cancellation of any private passenger motor vehicle insurance policy, regardless of whether or not the first two months of premiums need to be paid up front, within the first 60 days for non-payment of premium when the check or other method of payment presented is subsequently dishonored.
  • PIP interest. Would conform the interest on overdue PIP benefits to the rate of interest on judgments generally.
Other Miscellaneous
  • Travel insurance. Would expand the coverage of travel insurance to include event cancellation and damage to travel accommodations, and lengthen the travel period that can be covered by a policy from 60 days to 90 days. Expands who can be licensed to sell travel insurance, to allow full-time salaried employees of general lines agents and business entities that do travel planning to sell travel insurance. 
  • Adjusters of portable electronics insurance.  Would exempt certain employees of licensed insurance agents or licensed insurance adjusters selling portable electronics insurance from having to be licensed as an insurance adjuster.
  • Surplus lines/commercial - disclosure.  Changes the required disclosures for commercial insurance sold in the surplus lines market.
  • Reinsurance summary statements.  Clarifies current law relating to the filing of reinsurance summary statements by insurers with the Florida OIR.
  • Spanish language testing for agents.  Allows the Department of Financial Services (DFS) to give licensure examinations in Spanish, and requires license applicants requesting an examination in Spanish to pay the costs related to the examination.
For more detail, see Staff Analysis on HB 1101 (Jan. 23, 2012).

This summary was prepared by Perry Cone and posted at

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