PCS for HB 799 (2023): An act relating to property insurance for wind and flood
Summary
This is the proposed committee substitute (PCS) for HB 799, 2023, a bill to be entitled an act relating to property insurance for wind and flood. It would amend section 627.062 so residential property insurance rate filings account for mitigation measures undertaken by policyholders, and amend section 627.0629 to include wind uplift prevention among windstorm damage mitigation techniques. For Citizens Property Insurance Corporation, flood coverage would be required on personal lines residential policies effective on or after January 1, 2024 for property valued at $600,000 or more, with lower thresholds of $500,000 and $400,000 in the next two years. A new section 627.7155 would bar insurers from issuing wind coverage unless flood coverage is verified and a written acknowledgment is obtained.
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“PCS for HB 799 (2023): An act relating to property insurance for wind and flood.”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2023-3228-insurance-banking-subcommittee-proposed-committee-bills-pcbs-a6ff2c4a7e/
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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 799 2023
1 A bill to be entitled
2 An act relating to property insurance for wind and
3 flood; amending s. 627.062, F.S.; requiring
4 residential property insurance rate filings to account
5 for windstorm mitigation measures undertaken by
6 policyholders; amending s. 627.0629, F.S.; requiring
7 wind uplift prevention to be included in windstorm
8 damage mitigation techniques for residential property
9 insurance rate filings; amending s. 627.351, F.S.;
10 making technical changes to flood insurance
11 requirements for Citizens Property Insurance
12 Corporation; creating s. 627.7155, F.S., requiring
13 property insurers to verify coverage for the peril of
14 flood in certain circumstances; prohibiting issuance
15 of coverage for the peril of wind in certain
16 circumstances; requiring an acknowledgement;
17 specifying a type of acceptable proof of coverage;
18 providing an effective date.
19
20 Be It Enacted by the Legislature of the State of Florida:
21
22 Section 1. Paragraph (j) of subsection (2) of section
23 627.062, Florida Statutes, is amended to read:
24 627.062 Rate standards.—
25 (2) As to all such classes of insurance:
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PCS for HB 799 2023
26 (j) With respect to residential property insurance rate
27 filings, the rate filing must account for mitigation measures
28 undertaken by policyholders to reduce hurricane losses and
29 windstorm losses.
30
31 The provisions of this subsection do not apply to workers'
32 compensation, employer's liability insurance, and motor vehicle
33 insurance.
34 Section 2. Subsection (1) of section 627.0629, Florida
35 Statutes, is amended to read:
36 627.0629 Residential property insurance; rate filings. —
37 (1) It is the intent of the Legislature that insurers
38 provide savings to consumers who install or implement windstorm
39 damage mitigation techniques, alterations, or solutions to their
40 properties to prevent windstorm losses. A rate filing for
41 residential property insurance must include actuarially
42 reasonable discounts, credits, or other rate differentials, or
43 appropriate reductions in deductibles, for properties on which
44 fixtures or construction techniques demonstrated to reduce the
45 amount of loss in a windstorm have been installed or
46 implemented. The fixtures or construction techniques must
47 include, but are not limited to, fixtures or construction
48 techniques that enhance wind uplift prevention, roof strength,
49 roof covering performance, roof-to-wall strength, wall-to-floor-
50 to-foundation strength, opening protection, and window, door,
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PCS for HB 799 2023
51 and skylight strength. Credits, discounts, or other rate
52 differentials, or appropriate reductions in deductibles, for
53 fixtures and construction techniques that meet the minimum
54 requirements of the Florida Building Code must be included in
55 the rate filing. The office shall determine the discounts,
56 credits, other rate differentials, and appropriate reductions in
57 deductibles that reflect the full actuarial value of such
58 revaluation, which may be used by insurers in rate filings.
59 Section 3. Effective upon becoming law, paragraph (aa) of
60 subsection (6) of section 627.351, Florida Statutes, is amended
61 to read:
62 627.351 Insurance risk apportionment plans.—
63 (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
64 (aa) Except as otherwise provided in this paragraph, the
65 corporation shall require the securing and maintaining of flood
66 insurance as a condition of coverage of a personal lines
67 residential risk. The insured or applicant must execute a form
68 approved by the office affirming that flood insurance is not
69 provided by the corporation and that if flood insurance is not
70 secured by the applicant or insured from an insurer other than
71 the corporation and in addition to coverage by the corporation,
72 the risk will not be eligible for coverage by the corporation.
73 The corporation may deny coverage of a personal lines
74 residential risk to an applicant or insured who refuses to
75 secure and maintain flood insurance. The requirement to purchase
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76 flood insurance shall be implemented as follows:
77 1. Except as provided in subparagraphs 2. and 3., all
78 personal lines residential policyholders must have flood
79 coverage in place for policies effective on or after:
80 a. January 1, 2024, for a structure or unit that has a
81 dwelling replacement cost of property valued at $600,000 or
82 more.
83 b. January 1, 2025, for a structure or unit that has a
84 dwelling replacement cost of property valued at $500,000 or
85 more.
86 c. January 1, 2026, for a structure or unit that has a
87 dwelling replacement cost of property valued at $400,000 or
88 more.
89 d. January 1, 2027, for all other personal lines
90 residential property insured by the corporation.
91 2. All personal lines residential policyholders whose
92 property insured by the corporation is located within the
93 special flood hazard area defined by the Federal Emergency
94 Management Agency must have flood coverage in place:
95 a. At the time of initial policy issuance for all new
96 personal lines residential policies issued by the corporation on
97 or after April 1, 2023.
98 b. By the time of the policy renewal for all personal
99 lines residential policies renewing on or after July 1, 2023.
100 3. Policyholders whose policies issued by the corporation
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101 do not provide coverage for the peril of wind are not required
102 to purchase flood insurance as a condition for maintaining their
103 policies with the corporation.
104
105 The flood insurance required under this paragraph must meet, at
106 a minimum, the coverage available from the National Flood
107 Insurance Program or the requirements of subparagraphs s.
108 627.715(1)(a)1., 2., and 3.
109 Section 4. Effective October 1, 2023, section 627.7155,
110 Florida Statutes, is created, to read:
111 627.7155 Wind and flood coverage in residential and
112 commercial property insurance policies.— For residential and
113 commercial property insurance policies issued or renewed on or
114 after October 1, 2023:
115 (1) If a residential or commercial property insurer
116 requires that an insured or applicant have coverage for the
117 peril of flood when the insurer issues a policy covering the
118 peril of wind, the insurer must verify that the insured or
119 applicant has coverage for the peril of flood at the time the
120 policy is issued or renewed. If the insurer fails to verify that
121 the insured or applicant has coverage for the peril of flood,
122 the insurer may not issue or renew a policy containing coverage
123 for the peril of wind. Prior to issuance of coverage for the
124 peril of wind under this subsection and upon verification of
125 coverage for the peril of flood, the insurer must obtain a
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126 written acknowledgment from the applicant or insured that the
127 applicant or insured understands that the policy covering the
128 peril of wind requires that coverage for the peril of flood must
129 be maintained by the applicant or insured.
130 (2) In addition to coverage for the peril of flood directly
131 secured by the applicant or insured, a master flood policy that
132 is issued to someone other than the applicant or insured and
133 includes the applicant or insured as an intended or third-party
134 beneficiary under the master flood policy is acceptable proof of
135 coverage for the peril of flood for the purposes of this
136 section.
137 Section 5. Except as otherwise provided, this act shall
138 take effect July 1, 2023.
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PCS for HB 799
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