PCS for HB 1111 (2023): An act relating to value-added insurance products
Summary
PCS for HB 1111 (ORIGINAL 2023), a bill to be entitled an act relating to value-added insurance products. The bill amends section 626.9541, paragraph (h) of subsection (1), on unlawful rebates, to provide that certain restrictions against unfair discrimination or unlawful rebates do not include value-added products or services offered or provided by insurers or their agents if certain conditions are met. It sets requirements and restrictions for insurers or agents offering such products or services and authorizes their use in a pilot or testing program under certain circumstances. The Financial Services Commission may adopt rules, and Section 2 provides a July 1, 2023 effective date.
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“PCS for HB 1111 (2023): An act relating to value-added insurance products.”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2023-3228-insurance-banking-subcommittee-proposed-committee-bills-pcbs-18ae39d156/
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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 HB 1111 ORIGINAL 2023
1 A bill to be entitled
2 An act relating to value-added insurance products;
3 amending s. 626.9541, F.S.; providing that certain
4 restrictions against unfair discrimination or unlawful
5 rebates do not include value-added products or
6 services offered or provided by insurers or their
7 agents if certain conditions are met; providing
8 requirements for and restrictions on insurers or
9 agents offering or providing such products or
10 services; authorizing insurers or agents to provide
11 such products or services as part of a pilot or
12 testing program under certain circumstances;
13 authorizing the Financial Services Commission to adopt
14 rules; providing an effective date.
15
16 Be It Enacted by the Legislature of the State of Florida:
17
18 Section 1. Paragraph (h) of subsection (1) of section
19 626.9541, Florida Statutes, is amended to read:
20 626.9541 Unfair methods of competition and unfair or
21 deceptive acts or practices defined.—
22 (1) UNFAIR METHODS OF COMPETITION AND UNFAIR OR DECEPTIVE
23 ACTS.—The following are defined as unfair methods of competition
24 and unfair or deceptive acts or practices:
25 (h) Unlawful rebates.—
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
26 1. Except as otherwise expressly provided by law, or in an
27 applicable filing with the office, knowingly:
28 a. Permitting, or offering to make, or making, any
29 contract or agreement as to such contract other than as plainly
30 expressed in the insurance contract issued thereon;
31 b. Paying, allowing, or giving, or offering to pay, allow,
32 or give, directly or indirectly, as inducement to such insurance
33 contract, any unlawful rebate of premiums payable on the
34 contract, any special favor or advantage in the dividends or
35 other benefits thereon, or any valuable consideration or
36 inducement whatever not specified in the contract;
37 c. Giving, selling, or purchasing, or offering to give,
38 sell, or purchase, as inducement to such insurance contract or
39 in connection therewith, any stocks, bonds, or other securities
40 of any insurance company or other corporation, association, or
41 partnership, or any dividends or profits accrued thereon, or
42 anything of value whatsoever not specified in the insurance
43 contract.
44 2. Nothing in paragraph (g) or subparagraph 1. of this
45 paragraph shall be construed as including within the definition
46 of discrimination or unlawful rebates:
47 a. In the case of any contract of life insurance or life
48 annuity, paying bonuses to all policyholders or otherwise
49 abating their premiums in whole or in part out of surplus
50 accumulated from nonparticipating insurance; provided that any
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
51 such bonuses or abatement of premiums is fair and equitable to
52 all policyholders and for the best interests of the company and
53 its policyholders.
54 b. In the case of life insurance policies issued on the
55 industrial debit plan, making allowance to policyholders who
56 have continuously for a specified period made premium payments
57 directly to an office of the insurer in an amount which fairly
58 represents the saving in collection expenses.
59 c. Readjustment of the rate of premium for a group
60 insurance policy based on the loss or expense thereunder, at the
61 end of the first or any subsequent policy year of insurance
62 thereunder, which may be made retroactive only for such policy
63 year.
64 d. Issuance of life insurance policies or annuity
65 contracts at rates less than the usual rates of premiums for
66 such policies or contracts, as group insurance or employee
67 insurance as defined in this code.
68 e. Issuing life or disability insurance policies on a
69 salary savings, bank draft, preauthorized check, payroll
70 deduction, or other similar plan at a reduced rate reasonably
71 related to the savings made by the use of such plan.
72 3.a. No title insurer, or any member, employee, attorney,
73 agent, or agency thereof, shall pay, allow, or give, or offer to
74 pay, allow, or give, directly or indirectly, as inducement to
75 title insurance, or after such insurance has been effected, any
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
76 rebate or abatement of the premium or any other charge or fee,
77 or provide any special favor or advantage, or any monetary
78 consideration or inducement whatever.
79 b. Nothing in this subparagraph shall be construed as
80 prohibiting the payment of fees to attorneys at law duly
81 licensed to practice law in the courts of this state, for
82 professional services, or as prohibiting the payment of earned
83 portions of the premium to duly appointed agents or agencies who
84 actually perform services for the title insurer. Nothing in this
85 subparagraph shall be construed as prohibiting a rebate or
86 abatement of an attorney fee charged for professional service s,
87 or that portion of the premium that is not required to be
88 retained by the insurer pursuant to s. 627.782(1), or any other
89 agent charge or fee to the person responsible for paying the
90 premium, charge, or fee.
91 c. No insured named in a policy, or any other person
92 directly or indirectly connected with the transaction involving
93 the issuance of such policy, including, but not limited to, any
94 mortgage broker, real estate broker, builder, or attorney, any
95 employee, agent, agency, or representative thereof, or any other
96 person whatsoever, shall knowingly receive or accept, directly
97 or indirectly, any rebate or abatement of any portion of the
98 title insurance premium or of any other charge or fee or any
99 monetary consideration or inducement whatsoever, except as se t
100 forth in sub-subparagraph b.; provided, in no event shall any
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
101 portion of the attorney fee, any portion of the premium that is
102 not required to be retained by the insurer pursuant to s.
103 627.782(1), any agent charge or fee, or any other monetary
104 consideration or inducement be paid directly or indirectly for
105 the referral of title insurance business.
106 4.a. Paragraph (g) or subparagraph 1. may not be construed
107 as including within the definition of discrimination or unlawful
108 rebates the offer or provision by an insurer or an agent of the
109 insurer, including by or through employees, affiliates, or
110 third-party representatives, of value-added products or services
111 at no or reduced cost when such products or services are not
112 specified in the insurance policy, if the product or service
113 relates to the insurance coverage and is primarily designed to
114 do one or more of the following:
115 (I) Provide loss mitigation or loss control;
116 (II) Reduce claim costs or claim settlement costs;
117 (III) Provide education about liability risks or risk of
118 loss to persons or property;
119 (IV) Monitor or assess risk, identify sources of risk, or
120 develop strategies for eliminating or reducing risk;
121 (V) Enhance health;
122 (VI) Enhance financial wellness through items such as
123 education or financial planning services;
124 (VII) Provide post-loss services;
125 (VIII) Incentivize behavioral changes to improve the
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
126 health or reduce the risk of death or disability of a
127 policyholder, potential policyholder, certificateholder,
128 potential certificateholder, insured, potential insured, or
129 applicant; or
130 (IX) Assist in the administration of employee or retiree
131 benefit insurance coverage.
132 b. The cost to the insurer or agent offering the product
133 or service to a customer must be reasonable in comparison to the
134 customer's premiums or insurance coverage for the policy class.
135 c. If the insurer or agent is providing the product or
136 service, the insurer or agent must ensure that the customer is
137 provided with contact information to assist the customer with
138 questions regarding the product or service.
139 d. The availability of the product or service must be
140 based on documented objective evidence, and the product or
141 service must be offered in a manner that is not unfairly
142 discriminatory. The documented evidence must be maintained by
143 the insurer or agent and produced upon request by the office or
144 the department.
145 e. If an insurer or agent has a good faith belief, but
146 does not have sufficient evidence to demonstrate, that the
147 product or service meets any of the criteria in sub-sub-
148 subparagraphs a.(I)-(IX), the insurer or agent may provide the
149 product or service in a manner that is not unfairly
150 discriminatory as part of a pilot or testing program for up to 1
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PCS for HB 1111
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 HB 1111 ORIGINAL 2023
151 year. An insurer or agent must notify the office or department,
152 as applicable, of such pilot or testing program offered to
153 consumers in this state before commencing the program. The
154 insurer or agent may commence the program unless the office or
155 department, as applicable, objects to the program within 21 days
156 after receiving the notice.
157 f. An insurer, agent, or representative thereof may not
158 offer or provide insurance as an inducement to the purchase of
159 another policy or otherwise use the words "free," "no cost," or
160 similar words in an advertisement.
161 g. The commission may adopt rules to administer this
162 subparagraph to ensure consumer protection. Such rules,
163 consistent with applicable law, may address, among other issues,
164 consumer data protections and privacy, consumer disclosure, and
165 unfair discrimination.
166 Section 2. This act shall take effect July 1, 2023.
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PCS for HB 1111
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