FAIA briefs agents about Florida bills, holds meetings with legislators

More than 120 of Florida’s independent agents who attended the March 29 and 30 Florida Independent Insurance Agents Legislative “Fly-In” heard Skip Long, Scott Johnson, Laura Pearce and Kyle Ulrich outline the pros and cons of legislation being considered in the Florida Legislature.

A second briefing featured Joel Blackwell, “The Grassroots Guy,” who told how to do grassroots lobbying, both in Tal-lahassee and when they return home to their districts.

After extensive briefings, March 30 the members walked to the capital where they met one-on-one with their representatives and senators.

FAIA prepared and gave everyone a position summary to take to the Hill, where they could discuss insurance industry-related bills with representatives in Florida government.

Consumer Choice

One of the biggest issues discussed was consumer choice, SB 627.3517. Consumer Choice says consumers can keep their agent if their policy is removed from Citizens by a formal takeout program. FAIA opposes the Senate Banking and Insurance Committee’s recommendation to repeal Consumer Choice.

Before Consumer Choice was enacted, Citizens’ Property Insurance Company policyholders subject to takeout received the poorest treatment and often had to pay more for less coverage. Worse, they lost their agent or were assigned to a company that did not use agents at all.

Anger and confusion became so acute that in 2002 lawmakers passed the Consumer Choice statute twice, once in conjunction with the creation of Citizens (SB 1418) and once in a stand-alone version (SB 1126).

FAIA spokesmen at the briefing said the best way to keep Citizens’ policy count down is to keep policies from going in. They said Consumers Choice helps this by causing takeout companies, most of which write new business, to appoint agents. An agent without such an appointment must send new policies to Citizens. Agents with such appointments are prohibited from doing so. Citizens’ population would be much higher if it weren’t for Consumers Choice.

FAIA supports:

House PB In-06-01, a property insurance bill, which includes:

1. Agent immunity for Citizens’ takeouts;

2. Rating flexibility capped at Citizens HRA (windpool) rate;

3. A study of carriers servicing Citizens wind business;

4. The establishment of a panel to determine HRA boundaries; and

5. An increase in the FIGA limit for property from $300,000 to $500,000.

Construction contracts, CIs

FAIA’s bill, HB 173/SB 682, regarding construction contracts and certificates of insurance.

FAIA feels it is essential to enact legislation providing that if subcontractors supply certificates of insurance
to the general contractors prior to commencing work and the general contractors allow the subcontractor to do the work, then the general contractors are precluded from

withholding payment for the work already completed, solely because the certificates do not meet the general contractors’ specifications.

The bill makes it absolutely clear that this does not apply to fraudulently issued or altered certifications; or in cases where the policy is cancelled, non-renewed, or materially and adversely altered after acceptance; or if the certificate or policy does not comply with the insurance coverage limits specified in the construction contract.

PIP renewal favored

SB 2114 and House PCB IN-06-03, which reforms PIP, as opposed to repealing PIP or extending the sunset.

FAIA feels the legislation addresses attorney fees by removing the expensive “contingency fee multiplier” that often results in extravagant attorney fee awards in very minor cases. It addresses fraud by giving prosecutors new tools and increasing penalties. It also puts a rein on some out-of-control health care costs, while at the same time, increasing the coverage for emergency hospital care.

Sinkhole testing standards

HB 217, SB 286, revise the testing standards for sinkholes, authorizes insurers to make direct payment for certain repairs and provides for an alternative procedure for the resolution of disputed sinkhole insurance claims.

FAIA feels the addresses all the sinkhole problems in a comprehensive and fair manner by allowing insurers to make payments directly to the person selected by the policyholder to perform the repairs, thus lessening the chance that the damage will be hidden and passed on to a subsequent buyer.

Also, testing is simplified and strengthened, the test results are conclusive unless contrary conclusions are proven by clear and convincing evidence.

PEO issues

HB 1383 and SB 2276, which reflect

PEO recommendations made by the Department of Financial Services Workers’ Compensation Task Force.

To make it easier on PEOs, the task force came up with an idea called PEO-Controlled Insurance Policies and Contractor-Controlled Insurance Policies currently being marketed by the insurance industry. The PEO industry prefers current law and opposes these suggestions.

HB 1455 and SB 2524, which provide that certain indemnification provisions in construction contracts are void and unenforceable.