Bill Text: FL S1836 | 2011 | Regular Session | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Insurance
Spectrum: Slight Partisan Bill (? 2-1)
Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [S1836 Detail]
Download: Florida-2011-S1836-Comm_Sub.html
Bill Title: Insurance
Spectrum: Slight Partisan Bill (? 2-1)
Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [S1836 Detail]
Download: Florida-2011-S1836-Comm_Sub.html
Florida Senate - 2011 CS for SB 1836 By the Committee on Banking and Insurance; and Senator Diaz de la Portilla 597-03867-11 20111836c1 1 A bill to be entitled 2 An act relating to captive insurers; amending s. 3 624.402, F.S.; exempting certain life or health 4 insurers covering nonresidents from having to obtain a 5 certificate of authority; amending s. 628.901, F.S.; 6 providing definitions; repealing s. 628.903, F.S., 7 relating to the definition of the term “industrial 8 insured captive insurer”; amending s. 628.905, F.S.; 9 requiring a captive insurer to obtain a license and to 10 file evidence that a person or firm with whom it 11 intends to conduct business is reputable; providing 12 that a certificate of insurance for an association 13 captive insurer does not exceed the total funds of the 14 association members; creating s. 628.908, F.S.; 15 requiring a licensed captive insurer to maintain its 16 principal place of business in this state and hold an 17 annual meeting in this state; amending s. 628.909, 18 F.S.; applying additional provisions of the insurance 19 code to captive insurers; providing an effective date. 20 21 Be It Enacted by the Legislature of the State of Florida: 22 23 Section 1. Subsection (9) is added to section 624.402, 24 Florida Statutes, to read: 25 624.402 Exceptions, certificate of authority required.—A 26 certificate of authority shall not be required of an insurer 27 with respect to: 28 (9) A life or health insurer domiciled outside the United 29 States covering only persons who, at the time of issuance or 30 renewal, are nonresidents of the United States but residing 31 legally in the United States if: 32 (a) The insurer does not solicit business from residents of 33 the United States; 34 (b) The insurer registers with the office via a letter of 35 notification upon commencing business from this state; 36 (c) Annually, by March 1, the insurer provides the 37 following information to the office: 38 1. The name of the insurer, the country of domicile, the 39 address of the insurer’s principal office and office in this 40 state, the names of the owners of the insurer and their 41 percentage of ownership, the names of the officers and directors 42 of the insurer, the name, e-mail, and telephone number of a 43 contact person for the insurer, and the number of individuals 44 who are employed by the insurer or its affiliates in this state; 45 2. The type of products offered by the insurer; 46 3. A statement from the applicable regulatory body of the 47 insurer’s domicile certifying that the insurer is licensed or 48 registered in that domicile; and 49 4. A copy of the filings required by the insurer’s 50 domicile; 51 (d) All certificates issued in this state showing coverage 52 under the insurer’s policy include the following statement in a 53 contrasting color and at least 10-point type: “The policy 54 providing your coverage and the insurer providing this policy 55 have not been approved by the Florida Office of Insurance 56 Regulation”; and 57 (e) The insurer ceases to do business from this state and 58 provides written notification to the office within 30 days after 59 cessation. 60 61 For purposes of this subsection, the term “nonresident” means a 62 person who has not had his or her principal place of domicile in 63 the United States for 180 days during the 365 days before 64 purchasing or renewing the policy; registered to vote in any 65 state; made a statement of domicile in any state; or filed for 66 homestead tax exemption on property in any state. 67 Section 2. Section 628.901, Florida Statutes, is amended to 68 read: 69 628.901 Definitions“Captive insurer” defined.—As used in 70For the purposes ofthis part, the term:except as provided in71s.628.903, a “captive insurer” is a domestic insurer72established under part I to insure the risks of a specific73corporation or group of corporations under common ownership74owned by the corporation or corporations from which it accepts75risk under a contract of insurance.76 (1) “Association” means a legal association of nursing 77 homes, hospitals, skilled nursing facilities, assisted living 78 facilities, or continuing care retirement communities. 79 (2) “Association captive insurer” means a company that 80 insures risks of the member organizations of the association and 81 their affiliated companies. 82 (3) “Captive insurer” means a pure captive insurer or an 83 association captive insurer domiciled in this state and formed 84 or licensed under this part. 85 (4) “Industrial insured” means an insured that: 86 (a) Has gross assets in excess of $50 million; 87 (b) Procures insurance through the use of a full-time 88 employee of the insured who acts as an insurance manager or 89 buyer or through the services of a person licensed as a property 90 and casualty insurance agent, broker, or consultant in such 91 person’s state of domicile; 92 (c) Has at least 100 full-time employees; and 93 (d) Pays annual premiums of at least $200,000 for each line 94 of insurance purchased from the industrial insured captive 95 insurer, or at least $75,000 for any line of coverage in excess 96 of at least $25 million in the annual aggregate. The purchase of 97 umbrella or general liability coverage in excess of $25 million 98 in the annual aggregate is deemed to be the purchase of a single 99 line of insurance. 100 (5) “Industrial insured captive insurer” is a captive 101 insurer that: 102 (a) Has as its stockholders or members only industrial 103 insureds that the captive insurer insures, or has as its sole 104 stockholder a corporation whose sole stockholders are industrial 105 insureds that the captive insurer insures; and 106 1. Provides insurance only to the industrial insureds that 107 are its stockholders or members, and affiliates thereof, or to 108 the stockholders, and affiliates thereof, of its parent 109 corporation; or 110 2. Provides reinsurance only on risks written by insurers 111 of industrial insureds who are the stockholders or members, and 112 affiliates thereof, of the captive insurer, or the stockholders, 113 and affiliates thereof, of the parent corporation of the captive 114 insurer; 115 (b) Maintains unimpaired capital and surplus of at least 116 $20 million; and 117 (c) If licensed in this state before December 31, 1999, or 118 if any subsidiary formed by the licensed insurer on or after 119 December 31, 1999, has: 120 1. Gross assets in excess of $10 million and procures 121 insurance through the use of a full-time employee of the insured 122 who acts as an insurance manager or buyer or through the 123 services of a person licensed as a property and casualty 124 insurance agent, broker, or consultant in such person’s state of 125 domicile; 126 2. At least 25 full-time employees; and 127 3. Annual aggregate premiums for all insurance risks which 128 total at least $100,000. 129 130 As used in this subsection, the term “affiliate” means a person 131 that directly or indirectly, through one or more intermediaries, 132 controls, is controlled by, or is under common control with one 133 or more of the stockholders or members of an industrial insured 134 captive insurer or one or more of the stockholders of the parent 135 corporation of an industrial insured captive insurer. 136 (6) “Pure captive insurer” means a company that insures the 137 risks of its parent, affiliated companies, controlled 138 unaffiliated businesses, or a combination thereof. 139 Section 3. Section 628.903, Florida Statutes, is repealed. 140 Section 4. Section 628.905, Florida Statutes, is amended to 141 read: 142 628.905 Licensing; authority.—In order to conduct insurance 143 business in this state, a captive insurer must obtain a license 144 from the office. 145 (1) AAnycaptive insurer, ifwhenpermitted by its charter 146 or articles of incorporation, may apply to the office for a 147 license to provide commercial property, commercial casualty, and 148 commercial marine insurance.coverage other than workers’149compensation and employer’s liability insurance coverage, except150thatAn industrial insured captive insurer may also apply for a 151 license to provide workers’ compensation and employer’s 152 liability insurance as set forth in subsection (5)(6). 153 (2) ANocaptive insurer, other than an industrial insured 154 captive insurer, may notshallinsure or accept reinsurance on 155 any risks other than those of its parent and affiliated 156 companies. 157 (3) In addition to information otherwise required by this 158 code, each applicant captive insurer shall file with the office 159 evidence: 160 (a) Of the adequacy of the loss prevention program of its 161 insureds. 162 (b) That it intends to employ or contract with a reputable 163 person or firm that possesses the appropriate expertise, 164 experience, and character to manage the association captive 165 insurer. 166 (4) If an association captive insurer operates with 167 separate cells or segregated accounts, a certificate of 168 insurance used to satisfy financial responsibility laws shall be 169 issued in an amount not exceeding the total funds in the 170 segregated accounts or separate cells of each member 171 organization of the association. 172 (5)(4)An industrial insured captive insurer: 173 (a) Need not be incorporated in this state if it has been 174 validly incorporated under the laws of another jurisdiction;.175 (b)(5)An industrial insured captive insurerIs subject to 176 all provisions of this part except as otherwise indicated; and.177 (c)(6)An industrial insured captive insurerMay not 178 provide workers’ compensation and employer’s liability insurance 179 except in excess of at least $25 million in the annual 180 aggregate. 181 Section 5. Section 628.908, Florida Statutes, is created to 182 read: 183 628.908 Principal place of business; annual meeting.—In 184 order to conduct insurance business in this state, a licensed 185 captive insurer must: 186 (1) Maintain its principal place of business in this state; 187 and 188 (2) Annually hold in this state at least one board of 189 directors’ meeting; or, in the case of a reciprocal insurer, one 190 subscriber’s advisory committee meeting; or, in the case of a 191 limited liability company, one managing board’s meeting. 192 Section 6. Paragraph (a) of subsection (2) and paragraph 193 (a) of subsection (3) of section 628.909, Florida Statutes, are 194 amended to read: 195 628.909 Applicability of other laws.— 196 (2) The following provisions of the Florida Insurance Code 197 shall apply to captive insurers who are not industrial insured 198 captive insurers to the extent that such provisions are not 199 inconsistent with this part: 200 (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085, 201 624.40851, 624.4095, 624.425, and 624.426. 202 (3) The following provisions of the Florida Insurance Code 203 shall apply to industrial insured captive insurers to the extent 204 that such provisions are not inconsistent with this part: 205 (a) Chapter 624, except for ss. 624.407, 624.408, 624.4085, 206 624.40851, 624.4095, 624.425, 624.426, and 624.609(1). 207 Section 7. This act shall take effect July 1, 2011.