PCS for CS/CS/HB 895 — An Act Relating to Insurance (2020)
Summary
PCS for CS/CS/HB 895 (original, 2020), a bill to be entitled an act relating to insurance, from the Commerce Committee. Section 1 amends subsection (3) of section 624.155, Florida Statutes, on the civil remedy notice, which as a condition precedent to an action requires the department and the authorized insurer to be given 60 days' written notice of the violation. The title also lists a duty of good faith by persons claiming against an insurer and pre-suit notice requirements in motor vehicle personal injury protection claims under s. 627.736, F.S. Section 4 states that the act takes effect July 1, 2020.
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Cite this document
“PCS for CS/CS/HB 895 — An Act Relating to Insurance (2020).”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2020-2994-commerce-committee-proposed-committee-bills-pcbs-fn-pcs-for-c3eb000376/
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for CS/CS/HB 895 ORIGINAL 2020
1 A bill to be entitled
2 An act relating to insurance; amending s. 624.155,
3 F.S.; revising requirements and procedures for the
4 civil remedy notice provided to insurers and the
5 Department of Financial Services; revising the
6 timeframe for an insurer to pay damages or for certain
7 circumstances to be corrected; revising the period the
8 statute of limitations is tolled; creating a duty of
9 good faith by persons claiming against an insurer;
10 providing that an insurer does not violate its good
11 faith duty to settle claims and is not liable for a
12 certain failure if it meets certain conditions;
13 providing a limitation on an insurer's liability to
14 third-party claimants, under certain circumstances;
15 requiring triers of fact, under certain circumstances,
16 to consider whether insureds, claimants, or their
17 representatives made good faith efforts to cooperate
18 with insurers' investigations; requiring a reduction
19 or elimination of damages awarded against an insurer
20 for bad faith where the insured or claimant has also
21 acted in bad faith; amending s. 624.422, F.S.,
22 requiring insurers to file with the department certain
23 contact information for service of process; amending
24 s. 627.736, F.S.; specifying information required as
25 part of a pre-suit notice in motor vehicle personal
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26 injury protection claims; requiring information
27 relating to treatment and services provided to
28 claimants; requiring the identification of payments in
29 dispute; requiring claimants to substantially comply
30 with notice requirements; prohibiting relief to
31 claimants in certain circumstances; providing an
32 effective date.
33
34 Be It Enacted by the Legislature of the State of Florida:
35
36 Section 1. Subsection (3) of section 624.155, Florida
37 Statutes, is amended to read:
38 624.155 Civil remedy.—
39 (3)(a) As a condition precedent to bringing an action
40 under this section, the department and the authorized insurer
41 must have been given 60 days' written notice of the violation.
42 Notice to the authorized insurer must be forwarded by the
43 department to the insurer at the e-mail address designated by
44 the insurer under s. 624.422.
45 (b) The notice shall be on a form provided by the
46 department and shall state with specificity the following
47 information, and such other information as the department may
48 require:
49 1. The statutory provision, including the specific
50 language of the statute, which the authorized insurer allegedly
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51 violated.
52 2. The facts and circumstances giving rise to the
53 violation.
54 3. The name of any individual involved in the violation.
55 4. Reference to specific policy language that is relevant
56 to the violation, if any. If the person bringing the civil
57 action is a third party claimant, she or he shall not be
58 required to reference the specific policy language if the
59 authorized insurer has not provided a copy of the policy to the
60 third party claimant pursuant to written request.
61 5. A statement that the notice is given in order to
62 perfect the right to pursue the civil remedy authorized by this
63 section.
64 (c)1. No action shall lie if, within 60 days after the
65 insurer receives filing notice from the department in accordance
66 with this subsection, the damages are paid or the circumstances
67 giving rise to the violation are corrected.
68 2. A third-party claimant shall have no action under sub-
69 paragraph (1)(b)1. if:
70 a. There is a single claimant in a liability claim and the
71 insurer offers the lesser of policy limits or the claimant's
72 demand prior to the end of the 60 days, including the period
73 prior to the 60 days; or
74 b. If there are two or more claimants in a liability claim
75 making claims arising out of a single occurrence which in total
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76 exceed the available policy limits of one or more of the insured
77 parties who may be liable to the claimants, an insurer is not
78 liable beyond the available policy limits for failure to pay all
79 or any portion of the available policy limits to one or more of
80 the claimants, if within 90 days after receiving notice of the
81 second claim or during the 60 days the insurer files an
82 interpleader action under the Florida Rules of Civil Procedure.
83 The claimants are entitled to a prorated share of the policy
84 limits as determined by the trier of fact. An insurer's
85 interpleader action does not alter or amend the insurer's
86 obligation to defend its insured.
87 (d) The authorized insurer that is the recipient of a
88 notice filed pursuant to this section shall report to the
89 department on the disposition of the alleged violation.
90 (e) The applicable statute of limitations for an action
91 under this section shall be tolled for a period of 60 65 days
92 after the insurer receives from the department by the mailing of
93 the notice required by this subsection or the mailing of a
94 subsequent notice required by this subsection.
95 (f) A notice required under this subsection may not be
96 filed within 60 days after appraisal is invoked by any party in
97 a residential property insurance claim.
98 (10)(a)_ The insured, claimant, or representative of the
99 insured or claimant has a duty to act in good faith in
100 furnishing information regarding the claim, in making demands of
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101 the insurer, in setting deadlines, and in attempts to settle a
102 claim. This duty does not create a separate cause of action and
103 may only be used as a setoff against damages awarded pursuant to
104 this subsection.
105 (b) In any action pursuant to sub-paragraph (1)(b)1.:
106 1. the trier of fact must consider whether the insured,
107 claimant, or representative of the insured or claimant made good
108 faith efforts to cooperate with the insurer in the investigation
109 of the claim.
110 2. If the trier of fact finds that the insured, claimant,
111 or representative of the insured or claimant did not act in good
112 faith, the trier of fact must reasonably reduce the damages
113 awarded against the insurer.
114 Section 2. Subsection (2) of section 624.422, Florida
115 Statutes, is amended to read:
116 624.422 Service of process; appointment of Chief Financial
117 Officer as process agent.—
118 (2) Prior to its authorization to transact insurance in
119 this state, each insurer shall file with the department
120 designation of the name and address of the person to whom
121 process against it served upon the Chief Financial Officer is to
122 be forwarded. Each insurer shall also file with the department
123 designation of the name and e-mail address of the person to whom
124 the department shall forward civil remedy notices filed under
125 624.155. The insurer may change a the designation at any time by
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126 a new filing.
127 Section 3. Subsection (10) of section 627.736, Florida
128 Statutes, is amended to read:
129 627.736 Required personal injury protection benefits;
130 exclusions; priority; claims.—
131 (10) DEMAND LETTER.—
132 (a) As a condition precedent to filing any action for
133 benefits or related relief under this section, written notice
134 of an intent to initiate litigation must be provided to the
135 insurer. Such notice may not be sent until the claim is
136 overdue, including any additional time the insurer has to pay
137 the claim pursuant to paragraph (4)(b).
138 (b) The notice must state that it is a "demand letter
139 under s. 627.736" and state the following with specificity:
140 1. The name of the insured on whose behalf upon which
141 such benefits are being sought and, if the claimant is not the
142 insured, the notice shall include, including a copy of the
143 assignment signed by the insured prior to the delivery of any
144 such treatment, service or accommodation, and giving rights to
145 the claimant to seek benefits if the claimant is not the
146 insured.
147 2. The claim number and or policy number upon which such
148 claim was originally submitted to the insurer by either the
149 claimant or the insured.
150 3. Where To the extent applicable, the name of any
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151 medical provider who rendered to an insured the treatment,
152 services, accommodations, or supplies that form the basis of
153 such claim against the insurer. The notice shall be
154 accompanied by; and an itemized statement identifying each
155 treatment, service or accommodation provided to the insured,
156 and shall specify for each such treatment, service or
157 accommodation on a line item basis as previously billed to the
158 insurer specifying each exact amount, the date of each
159 treatment, service, or accommodation, and the amount charged
160 type of benefit claimed to be due. A completed form satisfying
161 the requirements of paragraph (5)(d) or the lost-wage
162 statement previously submitted, as applicable, shall be
163 included with may be used as the itemized statement. To the
164 extent that the demand involves an insurer's withdrawal of
165 payment under paragraph (7)(a) for future treatment not yet
166 rendered, the claimant shall attach a copy of the insurer's
167 notice withdrawing such payment and an itemized statement of
168 the type, frequency, and duration of future treatment claimed
169 to be reasonable and medically necessary.
170 4. The identification of all line items that the
171 claimant contends to be in dispute because of an insurer's
172 non-payment or underpayment, the legal or factual basis for
173 the claimant's position that the insurer's underpayment
174 payment or non-payment is incorrect, and the amount that the
175 clamant contends that the insurer is required to pay to fully
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176 resolve the dispute, including the specific amount of the
177 statutory penalty, interest and postage to be paid pursuant to
178 paragraphs (d) and (e).
179 (c) If the claimant contends that the insured had an
180 emergency medical condition, the notice shall be accompanied
181 by documentation demonstrating that the insured to whom the
182 treatment, services or accommodation was provided sustained an
183 emergency medical condition. The documentation shall be from
184 a provider identified in sub-paragraphs (1)(a)(1) or
185 (1)(a)(2).
186 (d)(c) Each notice required by this subsection must
187 substantially comply with the requirements of paragraphs (b)
188 and (c) and must be delivered to the insurer by United States
189 certified or registered mail, return receipt requested. A
190 notice that does not substantially comply with the
191 requirements of paragraphs (b) and (c) shall not trigger an
192 insurer's obligations under (e). Such postal costs shall be
193 reimbursed by the insurer if requested by the claimant in the
194 notice, when the insurer pays the claim. Such notice must be
195 sent to the person and address specified by the insurer for
196 the purposes of receiving notices under this subsection. Each
197 licensed insurer, whether domestic, foreign, or alien, shall
198 file with the office the name and address of the designated
199 person to whom notices must be sent which the office shall
200 make available on its Internet website. The name and address
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201 on file with the office pursuant to s. 624.422 is deemed the
202 authorized representative to accept notice pursuant to this
203 subsection if no other designation has been made.
204 (e)(d) If, within 30 days after receipt of notice by the
205 insurer, the overdue claim specified in a the notice that
206 substantially complies with paragraphs (b) and (c) is paid by
207 the insurer together with applicable interest and a penalty of
208 10 percent of the overdue amount paid by the insurer, subject
209 to a maximum penalty of $250, no action may be brought against
210 the insurer. If the demand involves an insurer's withdrawal of
211 payment under paragraph (7)(a) for future treatment not yet
212 rendered, no action may be brought against the insurer if,
213 within 30 days after its receipt of the notice, the insurer
214 mails to the person filing the notice a written statement of
215 the insurer's agreement to pay for such treatment in
216 accordance with the notice and to pay a penalty of 10 percent,
217 subject to a maximum penalty of $250, when it pays for such
218 future treatment in accordance with the requirements of this
219 section. To the extent the insurer determines not to pay any
220 amount demanded, the penalty is not payable in any subsequent
221 action. For purposes of this subsection, payment or the
222 insurer's agreement shall be treated as being made on the date
223 a draft or other valid instrument that is equivalent to
224 payment, or the insurer's written statement of agreement, is
225 placed in the United States mail in a properly addressed,
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226 postpaid envelope, or if not so posted, on the date of
227 delivery. The insurer is not obligated to pay any attorney
228 fees if the insurer pays the claim or mails its agreement to
229 pay for future treatment within the time prescribed by this
230 subsection.
231 (f)(e) The applicable statute of limitation for an
232 action under this section shall be tolled for 30 business days
233 by the mailing of a the notice required by this subsection.
234 (g) No action shall be filed or prosecuted by or on
235 behalf of a claimant seeking benefits or related relief
236 against an insurer:
237 1. if a substantially compliant notice is not sent to an
238 insurer;
239 2. the insurer issued full payment to the claimant in
240 response to a notice within the time frame prescribed by
241 paragraph (e); or
242 3. asserting a claim of non-payment or underpayment of
243 benefits not identified in the notice.
244 Section 4. This act shall take effect July 1, 2020.
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