House Staff Analysis: PCS for CS/CS/HB 989 Financial Services (Commerce Committee)
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- Congressional materials
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- 2024 3220 Commerce Committee Proposed Committee Bill Analyses Fn Pcs0989 Com
- Case
- 2024 3220 Commerce Committee Proposed Committee Bill Analyses Fn Pcs0989 Com
Summary
A Florida House of Representatives staff analysis, dated February 21, 2024, of PCS for CS/CS/HB 989, Financial Services, sponsored by the Commerce Committee. The summary lists changes including renaming the Division of Investigative and Forensic Services to the Division of Criminal Investigations, establishing a federal tax liaison, allowing complaints to the Office of Financial Regulation over certain account access restrictions, and mandating DFS approval for association contracts exceeding $100,000. It also covers workers' compensation reimbursement, funeral and cemetery licensees, agent licensing, State Fire Marshal provisions and a substantial revision of the Florida Disposition of Unclaimed Property Act. The full analysis describes current law and the effect of the bill, followed by fiscal impact statements and comments.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“House Staff Analysis: PCS for CS/CS/HB 989 Financial Services (Commerce Committee).”
Original at www.flhouse.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2024-3220-commerce-committee-proposed-committee-bill-analyses-fn-pcs0989-com/
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HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #. PCS for CS/CS/HB 989 Financial Services
SPONSOR(S). Commerce Committee
TIED BILLS. IDEN./SIM. BILLS.
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
Orig. Comm.: Commerce Committee Herrera Hamon
SUMMARY ANALYSIS
The bill makes changes to various laws related to financial services, including the Department of Financial
Services (DFS), that include:
Renaming the Division of Investigative and Forensic Services to the Division of Criminal Investigations.
Establishing a tax liaison appointed by the Chief Financial Officer to assist Florida's taxpayers with federal tax
issues.
Enabling customers to file complaints with the Office of Financial Regulation for certain account access
restrictions, and providing for investigation of financial institutions who have acted in bad faith, including
penalties and prosecution.
Allows suspension or disqualification for Qualified Public Depositories in certain circumstances.
Providing a Workers' Compensation reimbursement methodology for emergency services and care when a
maximum reimbursement allowance is unavailable.
Mandating DFS approval for contracts exceeding $100,000 by various associations, ensuring competitive
procurement.
Making select changes related to the Board of Funeral, Cemetery, and Consumer Services; granting DFS
authority to disclose certain confidential and exempt public record information; enhancing DFS oversight
and administrative authority over Board licensees; and establishing disbursement protocols upon fulfillment
of preneed contracts.
Amending service of process related provisions; adjusting certain notice requirements for administrative
complaints and citations.
Requiring timely responses from surplus lines insurers to the Division of Consumer Services.
Allowing voluntary submission of information allowing two-factor authentication in agent licensing.
Establishing certain exemptions from the agent licensing examination requirements.
Allowing disclosure of confidential investigative information in certain circumstances.
Requiring licensed adjusters to identify themselves in advertisements based on their adjuster appointment
type.
Allowing general lines agents with a surplus lines license to appoint licenses with a single surplus license agent
appointment.
Revising certain State Fire Marshal-related provisions on fireworks usage, the Florida Fire Prevention
Code, and safety standards for mobile food dispensing vehicles and energy storage systems.
Modifying certain financial requirements for warranty associations and motor vehicle service agreement
companies.
Exempting municipal or county government employees from certain licensing and appointment
requirements.
Clarifying that bail bond agents are not exclusively required to be employed with a bail bond agency.
Substantially revising the Florida Disposition of Unclaimed Property Act.
Creating reporting requirements for the Florida Birth-Related Neurological Injury Compensation Association
(NICA) and modifying the calculation of reserve estimates related to limitations on ongoing enrollment.
See Fiscal Analysis & Economic Impact Statement for fiscal impacts of the bill.
Except as specified in the bill, it is effective upon becoming law.
This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives .
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FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
ORGANIZATION OF THE DEPARTMENT OF FINANCIAL SERVICES
The Chief Financial Officer (CFO) is an elected member of the Cabinet, serves as the state’s chief
fiscal officer,1 and is designated as the State Fire Marshal. The CFO is the head of the Department of
Financial Services (DFS). Effective January 2003, the Department of Insurance, Treasury, State Fire
Marshal, and the Department of Banking and Finance merged to form DFS. DFS consists of 13
divisions and several specialized offices.2 DFS is composed of the following divisions and independent
offices:
Accounting and Auditing;
Consumer Services;
Funeral, Cemetery, and Consumer Services;
Insurance Agent and Agency Services;
Investigative and Forensic Services;3
Public Assistance Fraud;
Rehabilitation and Liquidation;
Risk Management;
State Fire Marshal;
Treasury;
Unclaimed Property;
Workers’ Compensation;
Administration; and the
Office of Insurance Consumer Advocate.
Division of Investigative and Forensic Services
The Division of Investigative and Forensic Services consolidates all law enforcement and forensic units
housed within DFS.4 Endowed with a comprehensive mandate, the division probes a diverse array of
fraudulent and criminal activities, such as investigations into insurance fraud, Workers' Compensation
fraud, fire, arson, explosives, theft or misuse of state funds, and the analysis of fire and explosives
samples.5
Effect of the Bill
The bill:
Renames the Division of Investigative and Forensic Services to the Division of Criminal
Investigations (DCI).
Designates DCI as a criminal justice agency with the authority to initiate and conduct
investigations into matters falling under the jurisdiction of the CFO and Fire Marshal.
Federal Tax Liaison
Florida Department of Revenue
1 Art. IV, s. 4, Fla. Const.
2 S. 20.121, F.S.
3 This division includes the Bureau of Forensic Services; Bureau of Fire, Arson, and Explosives Investigations; Office of Fisca l Integrity;
Bureau of Insurance Fraud; and Bureau of Workers’ Compensation Fraud.
4 Department of Financial Services, Investigative and Forensic Services, Ab out the Division, https://myfloridacfo.com/Division/DIFS/
(last visited January 22, 2024).
5 Id.
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The Florida Department of Revenue (DOR) manages programs such as the Child Support Program,
General Tax Administration, and Property Tax Oversight.6 DOR's primary responsibility lies in
administering Florida's state tax law.7 To encourage tax compliance, DOR offers taxpayer education
through online resources and webinars.8 Furthermore, DOR monitors taxpayer compliance and initiates
enforcement actions, including audits and collections, while prioritizing the protection of taxpayer
rights.9
Taxpayer Rights Advocate
The Taxpayer Rights Advocate (TRA) is a position established by statute, appointed by, and
accountable to the DOR Chief Inspector General, with removal from office authorized only by the Chief
Inspector General.10 The TRA's role is to address taxpayer concerns and ensure adherence to taxpayer
rights as defined by constitutional and statutory provisions.11
Article I, Section 25 of the Florida Constitution provides for the enactment of a Taxpayers’ Bill of Rights
by the legislature, outlining taxpayers’ rights and responsibilities and the government’s obligations to
treat taxpayers fairly.12 The 1992 Florida Legislature created the Taxpayer’s Bill of Rights, specified in
s. 213.015, F.S., which grants taxpayers the right to request assistance from a DOR Taxpayer Rights
Advocate.13
TRA facilitates the resolution of taxpayer complaints and problems not resolved through regular
administrative channels within DOR.14 This includes issuing stay actions on behalf of taxpayers facing
irreparable loss due to DOR actions.15 Additionally, TRA’s are required to safeguard taxpayer rights
during tax determination and collection processes.16
While the TRA advocates for taxpayer rights, they do not administer DOR’s general tax processes. 17
TRA cannot represent taxpayers but works to ensure fair treatment and resolution of taxpayer issues. 18
TRA does not handle inquiries regarding local property tax matters, instead referring them to DOR’s
Property Tax Oversight Program.19
Effect of the Bill
The bill establishes a Federal Tax Liaison position within DFS, tasked with aiding federal taxpayers in
this state. The CFO appoints the liaison, who reports directly to the CFO but operates independently of
DFS’s authority. The liaison's responsibilities include assisting taxpayers with inquiries, directing them
to the appropriate Internal Revenue Service (IRS) divisions and offices for issue resolution, making
recommendations to the IRS to address taxpayer problems, providing information on IRS policies and
procedures for tax law compliance, and requesting IRS records with taxpayer consent to assist
inquiries.
6 DOR, Quick Facts ab out the Florida DOR, https://floridarevenue.com/opengovt/Pages/quick_facts.aspx (last visited Jan. 25, 2024).
7 Florida DOR. Florida’s Taxpayers’ Rights Advocate Annual Report July 1, 2020-June 30,2021, p.7 4- TRA Annual Report (FY 20-
21).pdf (floridarevenue.com) (last visited Jan. 25, 2024).
8
Id.
9 Id.
10 Id. at 1.
11 Id.
12 Art. I, s. 25, Fla. Const.
13 Florida DOR. Florida’s Taxpayers’ Rights Advocate Annual Report July 1, 2020 -June 30,2021, p.1 4- TRA Annual Report (FY 20-
21).pdf (floridarevenue.com) (last visited Jan. 25, 2024). See also S. 20.21(3), F.S.
14 Id.
15 Id.
16 Id.
17 Id. at 2.
18 Id.
19 Id.
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Division of Risk Management
The Division of Risk Management strives to support Florida's state agencies and universities by
assisting them in managing various risks and ensuring quality coverage for Workers' Compensation,
liability, federal civil rights, automobile liability, and property insurance at reasonable rates.20 This is
achieved through self-insurance, the purchase of insurance, and effective claims administration. 21 The
Division of Risk Management consists of three bureaus: Risk Financing and Loss Prevention, State
Employee Workers’ Compensation Claims, and State Liability and Property Claims. 22
Effect of the Bill
The bill eliminates the requirement for the Division of Risk Management to produce quarterly reports
detailing the total salary indemnification benefits paid and reimbursements from each agency to the State
Risk Management Trust Fund for initial salary indemnity costs.
Financial Institutions Codes
Florida’s Financial Institutions Codes are codified under Title XXXVIII of the Florida Statutes. 23 The
Financial Institutions Codes apply to all state-authorized and state-chartered financial institutions and to
the enforcement of all laws relating to state-authorized and state-chartered financial institutions.24 The
Financial Institutions Codes define the term “financial institution” as a state or federal savings or thrift
association, bank, savings bank, trust company, international bank agency, international banking
corporation, international branch, international representative office, international administrative office,
international trust entity, international trust company representative office, qualified limited service
affiliate, credit union, or an agreement corporation operating pursuant to s. 25 of the Federal Reserve
Act, 12 U.S.C. ss. 601 et seq. or Edge Act corporation organized pursuant to s. 25(a) of the Federal
Reserve Act, 12 U.S.C. ss. 611 et seq.25
A primary purpose of the Financial Institutions Codes is to provide for and promote the safe and sound
conduct of the financial services industry in Florida.26 The specific chapters under the Financial
Institutions Codes are:
Ch. 655, F.S. – Financial Institutions Generally
Ch. 657, F.S. – Credit Unions
Ch. 658, F.S. – Banks and Trust Companies
Ch. 660, F.S. – Trust Business
Ch. 662, F.S. – Family Trust Companies
Ch. 663, F.S. – International Banking
Ch. 665, F.S. – Associations
Ch. 667, F.S. – Savings Banks
Office of Financial Regulation
The Office of Financial Regulation (OFR) is the regulatory authority for Florida’s financial services
industry.27 OFR reports to the Financial Services Commission (Commission) which is made up of the
Governor and the members of the Florida Cabinet: the Chief Financial Officer (CFO), Attorney General
(AG), and Agriculture Commissioner.28 OFR enforces and administers the Financial Institutions Codes;
20
DFS, Division of Risk Management, Fiscal Year 2021 Annual Report, https://www.myfloridacfo.com/docs-sf/risk-management-
libraries/risk-documents/annual-reports/risk-mgmt-annual-report-2021.pdf?sfvrsn=720e7fcb_4 (last visited Jan. 17, 2024).
21 Id.
22 Id.
23 S. 655.005(1)(k), F.S.
24 S. 655.001(1), F.S.
25 S. 655.005(i), F.S.
26 S. 655.001(2), F.S.
27 Florida Office of Financial Regulation, Ab out Our Agency, https://flofr.gov/sitePages/AboutOFR.htm (last visited Dec. 4, 2023).
28 Id.
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is responsible for supervising banks, credit unions, savings associations, and international bank
agencies; and licenses and regulates non-depository finance companies and the securities industry. 29
Bank Secrecy Act
The federal Bank Secrecy Act (BSA)30 establishes reporting, recordkeeping, and related requirements
for federal and state-chartered31 financial institutions to help detect and prevent money laundering. 32
Specifically, the BSA and other anti-money laundering regulations (BSA/AML) require financial
institutions to, among other things, keep records of cash purchases of negotiable instruments and file
reports of cash transactions exceeding $10,000 (daily aggregate amount). 33
Under the BSA/AML laws, financial institutions must also:
establish effective BSA compliance programs;
establish effective customer due diligence systems and monitoring programs;
screen against Office of Foreign Assets Control lists and other government lists;
establish an effective suspicious activity monitoring and reporting process; and
develop risk-based anti-money laundering programs.34
The U.S. Office of the Comptroller of Currency regularly conducts examinations of national banks,
federal branches, federal savings associations, and agencies of foreign banks in the U.S. to determine
compliance with BSA/AML laws.35
Suspicious Activity Reports
In addition to the other requirements under the BSA/AML laws, financial institutions are also required to
report suspicious activity that might signify money laundering, tax evasion, or other criminal activities. 36
These types of reports are known as “suspicious activity reports” (SAR) and are filed with the Financial
Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, using
FinCEN’s BSA E-filing system.37
Under this requirement, a financial institution is required to file an SAR no later than 30 calendar days
after the date of initial detection of facts that may constitute a basis for filing an SAR.38 For instances
where no suspect was identified on the date of the incident requiring the filing, a financial institution
may delay filing an SAR for an additional 30 calendar days to identify a suspect. 39 However, in no case
shall reporting be delayed more than 60 calendar days after the date of initial detection of a reportable
transaction.40
29
Florida Department of Financial Services, Financial Services Commission, https://www.myfloridacfo.com/about/about-dfs/commission
(last visited Dec. 4, 2023). See also, s. 655.012, F.S.
30 31 U.S.C. § 5311 et seq.
31 See, 12 C.F.R. § 326.8 (sets forth requirements for state-chartered banks to establish and maintain procedures to ensure and
monitor their compliance with the BSA). See also, 12 C.F.R. § 353 (establishes requirements for state-chartered banks to file a
suspicious activity report under certain circumstances).
32 U.S. Treasury Financial Crimes Enforcement Network, FinCEN’s Legal Authorities, https://www.fincen.gov/resources/fincens-legal-
authorities (last visited Dec. 6, 2023).
33 Id.
34 U.S. Office of the Comptroller of the Currency, Bank Secrecy Act, https://www.occ.treas.gov/topics/supervision-and-
examination/bsa/index-bsa.html (last visited Dec. 5, 2023).
35 Id.
36 U.S. Treasury Financial Crimes Enforcement Network, supra note 10.
37 U.S. Office of the Comptroller of the Currency, Suspicious Activity Report Program , https://www.occ.treas.gov/publications-and-
resources/forms/sar-program/index-sar-program.html (last visited Dec. 5, 2023).
38 Id.
39 Id.
40 Id.
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Federal Trade Commission Act
Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. § 45, prohibits “unfair or
deceptive acts or practices in or affecting commerce.” 41 The prohibition applies to all persons engaged
in commerce, including state-chartered banks.42 The Board of Governors of the Federal Reserve
System have authority under federal law 43 to take appropriate action when unfair or deceptive acts or
practices are discovered, regardless of state authorities having primary responsibility for enforcing state
statutes against unfair or deceptive acts or practices. 44
Under the FTC Act, an act or practice is considered unfair if it:
Causes or is likely to cause substantial injury to consumers;
Cannot be reasonably avoided by consumers; and
Is not outweighed by countervailing benefits to consumers or to competition. 45
According to the Board of Governors of the Federal Reserve System, there may be circumstances in
which an act or practice violates section 5 of the FTC Act even though the institution is in technical
compliance with other applicable laws, such as the BSA/AML laws.46 Moreover, the policies behind the
BSA/AML laws could arguably outweigh a finding that a financial institution committed an unfair act
under section 5 of the FTC Act.
Florida Control of Money-Laundering and Terrorist Financing in Financial Institutions Act
The purpose of the Florida Control of Money-Laundering and Terrorist Financing in Financial
Institutions Act47 (Act), s. 655.50, F.S., is to require submission to OFR of certain reports and the
maintenance of certain records of customers, accounts, and transactions involving currency or
monetary instruments or suspicious activities if:48
such reports and records deter using financial institutions to conceal, move, or provide proceeds
obtained from or intended for criminal or terrorist activities; or
such reports and records have a high degree of usefulness in criminal, tax, or regulatory
investigations or proceedings.
The Act requires financial institutions to designate and retain a BSA/AML compliance officer, which is
defined as an officer that is responsible for the development and implementation of the financial
institution’s policies and procedures for complying with the requirements of the Act and BSA/AML
laws.49 Any change in a financial institution’s BSA/AML compliance officer must be reported to OFR.50
Additionally, the Act requires financial institutions to maintain: 51
full and complete records of all financial transactions, including all records required by the
BSA/AML laws, for a minimum of 5 years;
a copy of all reports filed with OFR as required under the Act for a minimum of 5 years after
submission of the report; and
41 Board of Governors of the Federal Reserve System, Division of Consumer and Community Affairs, Federal Trade Commission Act
(last updated Dec. 2016), p. 1, https://www.federalreserve.gov/boarddocs/supmanual/cch/ftca.pdf (last visited Feb. 6, 2024).
42
Id.
43
Section 8 of the Federal Deposit Insurance Act, 12 U.S.C.A. § 1811, et seq.
44 Board of Governors of the Federal Reserve System, Division of Consumer and Community Affairs, supra note 19, p. 1.
45 Board of Governors of the Federal Reserve System, Division of Consumer and Community Affairs, supra note 19, p. 1.
46 Board of Governors of the Federal Reserve System, Division of Consumer and Community Affairs, supra note 19, p. 7.
47
S. 655.50, F.S.
48 S. 655.50(2), F.S.
49 S. 655.50(4), F.S.
50 Id.
51 S. 655.50(8), F.S.
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a copy of all records of exemption for each qualified business customer 52 for a minimum of 5
calendar years after termination of exempt status of such customer.
The Act also requires financial institutions to keep a record of each financial transaction which involves
currency or other monetary instrument that has a value greater than $10,000, involves the proceeds of
specified unlawful activity, or is designed to evade the reporting requirements of the Act or other state
or federal laws, or which the financial institution reasonably believes is suspicious activity.53
A financial institution, or officer, employee, or agent thereof, which files a report in good faith pursuant
to the Act is not liable to any person for loss or damage caused in whole or in part by the making, filing,
or governmental use of the report, or any information contained therein. 54
OFR Enforcement
In addition to any other powers conferred by the Financial Institutions Codes, OFR may bring an action
in court to enforce or administer the Act, as well as issue and serve upon any person an order of
removal if OFR determines such person is violating, has violated, or is about to violate any provisions of
the Act or any similar state or federal law.55
OFR may also impose and collect an administrative fine against any person found to have violated any
provision of the Act or similar state or federal law in an amount up to $10,000 per day for each willful
violation or $500 per day for each negligent violation.56
Violation of the Act
A person who willfully violates the Act commits a misdemeanor of the first degree, 57 unless the violation
involves financial transactions of certain amounts, in which case the criminal penalties vary by first,
second, and third-degree felonies depending on the amount and timing of such transactions. 58
In addition to the criminal penalties, a person who violates the Act may be subject to a fine of up to
$250,000 or twice the value of the financial transaction, whichever is greater, and a subsequent
violation could result in a fine up to $500,000 or quintuple the value of the financial trans action,
whichever is greater.59
A person or financial institution who violates the Act may also be liable for a civil penalty of not more
than the greater of the value of the financial transaction involved or $25,000. 60
52 See, 31 U.S.C. § 5313(e), providing that the U.S. Secretary of Treasury (Secretary) may exempt a depository institution
from BSA/AML reporting requirements for transactions between the institution and a “qualified business customer” (QBC)
of the institution on the basis of information submitted to the Secretary. QBC is defined as a business that:
maintains a transaction account at the depository institution;
frequently engages in transactions with the institution which are subject to BSA/AML reporting requirements; and
meets criteria which the Secretary determines is sufficient to ensure the purposes of the BSA/AML laws are
carried out without requiring a report for such transactions.
53 S. 655.50(5), F.S.
54 S. 655.50(5)(c), F.S.
55 Ss. 655.50(9)(a)-(c), F.S.
56 S. 655.50(9)(d), F.S.
57 S. 655.50(10)(a), F.S.
58 S. 655.50(10)(b), F.S. See also, s. 775.082, F.S. A person who willfully violates or knowingly causes another to violate
the Act and the violation involves financial transactions of certain amounts:
financial transactions totaling or exceeding $300 but less than $20,000 in any 12-month period, commits a felony
of the third degree;
financial transactions totaling or exceeding $20,000 but less than $100,000 in any 12-month period, commits a
felony of the second degree; or
financial transactions totaling or exceeding $100,000 in any 12-month period, commits a felony of the first degree.
59 S. 655.50(10)(c), F.S.
60 Ss. 655.50(10)(d)-(e), F.S.
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Effects of Banks’ Termination of Account Access
In 2022, banks filed over 1.8 million SARs, which is a 50% increase in two years. 61 Multiple SARs often
result in a financial institution terminating, suspending, or otherwise restricting a customer’s account
access.62 A New York Times study of over 500 cases of financial institutions “dropping” their
customers, including interviews with current and former bank industry staffers, revealed the negative
effects of a bank’s decision to remove a customer’s account access:
Individuals can’t pay their bills on time. Banks often take weeks to send them
their balances. While the institutions close their credit cards, their credit scores
suffer. Upon cancellation, small businesses often struggle to make payroll – and
must explain to vendors and partners that they don’t have a bank account for the
time being… [And] once customers have moved on, they don’t know whether
there is a black mark somewhere on their permanent records that will cause a
repeat episode at another bank. If the bank has filed an SAR, it isn’t legally
allowed to tell you, and the federal government prosecutes only a small fraction
of the people whom the banks document in their SARs. 63
As a result, customers do not know why they were ever under suspicion.64 Interviews with individuals
who had lost access to their accounts revealed behaviors that may have caused their banks to “drop”
them.65 Specifically, a few of the interviews revealed the following: 66
Unusual Cash Deposits: When a bar owner’s weekly cash deposits fell just below the federal
currency reporting thresholds, the bank closed the bar’s account and the personal checking and
credit card accounts of the owner and his spouse.
A Marijuana Connection: A married couple’s accounts at a bank were shut down after the
husband started receiving direct deposits from a cannabis company that had recently acquired
his employer.
Criminal History: A man who had served 5 years in prison for stealing a car from a dealership
and using a counterfeit bill (among other crimes) had his accounts shut down at three different
banks. His personal banker from the third bank hinted it was because of his criminal record.
Qualified Public Depositories
Unless a specific exemption applies, state and local governments must deposit public funds in a bank
or savings association that has been designated as a qualified public depository (QPD) under the
Florida Security for Public Deposits Act (FSPD).67
To be designated as a QPD by the CFO, a bank, savings bank, or savings association must:
Have a federal or state charter;
Have authority to accept deposits in Florida;
Have its principal place of business in Florida, or a branch office in Florida;
Have deposit insurance pursuant to the Federal Deposit Insurance Act;68
Have procedures and practices for accurate identification, classification, reporting, and
collateralization of public deposits;
61 Ron Lieber and Tara Seigel Bernard, Why Bank s Are Suddenly Closing Down Customer Accounts, Thomson Reuters
(Nov. 5, 2023), https://www.nytimes.com/2023/11/05/business/banks-accounts-close-
suddenly.html?unlocked_article_code= 1.8Uw.udoQ. 0cmUgCSuo6eS&smid=nytcore -android-s hare (last visited Dec. 5,
2023).
62 Id.
63 Id.
64 Id.
65 Id.
66 Id.
67 S. 280.01, F.S. The Florida Security for Public Deposits Act is codified under ch. 280, F.S.
68 12 U.S.C.A. Ch. 16.
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Annually attest to the CFO that the QPD has not engaged in an “unsafe and unsound practice”
by denying or cancelling services based on environmental, social, or governance factors, as
required by s. 280.025, F.S.; and
Meet all the requirements of ch. 280, F.S., relating to security for public deposits. 69
Under the FSPD, a QPD may be suspended or disqualified or both if the CFO determines that the QPD
has engaged in certain activities that are listed in s. 280.051, F.S.
Additionally, if the CFO finds that one or more grounds exist for the suspension or disqualification of a
QPD, the CFO may, in lieu of suspension or disqualification, impose an administrative penalty upon the
QPD.70 Specifically, with respect to any knowing and willful violation by the QPD of a lawful order or
rule, the CFO may impose a penalty not exceeding $1,000 for each violation. 71 Currently, only failure to
timely file the attestation required under s. 280.025, F.S., is deemed a knowing and willful violation by a
QPD.72
Effect of the Bill
Complaints by Customers or Members of a Financial Institution Alleging Bad Faith
The bill amends Florida’s Financial Institutions Codes to allow a customer or member of a financial
institution who reasonably believes that a financial institution has terminated, suspended, or taken
similar action restricting access to the customer’s or member’s account in bad faith to file, within 30
calendar days of such action, a complaint with OFR alleging a violation of proposed s. 655.49, F.S.
Such complaint is barred if not timely filed.
The bill requires OFR, by July 1, 2024, to make available on its website information necessary for a
customer or member of a financial institution to file a complaint with OFR pursuant to the bill’s
provisions.
If a financial institution’s termination, suspension, or similar action restricting account access was due
to any of the following, the bill’s provisions do not apply:
The customer or member initiated the access change themselves;
There was a lack of activity in the account; or
The property is presumed unclaimed pursuant to ch. 717, F.S. 73
Termination-of-Access Report
Upon OFR’s receipt of a complaint filed by a customer or member, within 30 calendar days, OFR must
notify the financial institution that a complaint has been filed. Within 30 calendar days of the financial
institution receiving notice from OFR, the financial institution must file with OFR a termination-of-access
report containing such information as the commission requires by rule.
OFR Investigation and Determination
Within 90 calendar days after receiving the termination-of-access report, OFR must investigate the
financial institution’s action and determine whether the action was taken in bad faith as substantiated
69 S. 280.02(26), F.S.
70 S. 280.054(1), F.S.
71 S. 280.054(1)(b), F.S.
72 Id.
73 Ch. 717, F.S. is the Florida Disposition of Unclaimed Property Act (FDUP Act). Unclaimed property is a financial asset that is
unknown or lost, or has been left inactive, unclaimed, or abandoned by its owner. Under the FDUP Act, unclaimed property is h eld by
business or government entities (known as “holders”) for a set period of time, usually 5 years. If the holder is unable to locate the
owner, re-establish contact, and return the asset, it is reported and remitted to the Florida Department of Financial Services’ Divisio n of
Unclaimed Property. See, Florida Department of Financial Services, Division of Unclaimed Property, Ab out,
https://fltreasurehunt.gov/UP-Web/sitePages/About.jsp (last visited Dec. 5, 2023).
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by competent and substantial evidence that was known or should have been known to the financial
institution at the time of the termination, suspension, or similar action.
Within 30 calendar days after making a bad faith determination, OFR must report to the AG and the
CFO such bad faith termination, suspension, or similar action. The report to the AG must describe the
findings of the investigation, provide a summary of the evidence, and state whether the financial
institution violated the Financial Institutions Codes. Upon reporting to the AG, OFR must also send a
copy of the report to the aggrieved customer or member by certified mail, return receipt requested.
The bill provides that a financial institution’s termination, suspension, or similar action restricting a
customer’s or member’s account access in bad faith (as determined by OFR), or a financial institution’s
failure to cooperate in an investigation conducted pursuant to proposed s. 655.49, F.S. (including,
without limitation, failure to timely file a termination-of-access report), constitutes a violation of Florida’s
Financial Institutions Codes and subjects the financial institution to the applicable sanctions and
penalties provided therein.
The bill requires OFR to provide any filed termination-of-access report, and any information contained
therein, to any federal, state, or local law enforcement or prosecutorial agency, and any federal or state
agency responsible for the regulation or supervision of financial institutions, if the provision of such
report is otherwise required by law.
Private Cause of Action
The bill provides a private cause of action to the aggrieved customer or member against the financial
institution that, pursuant to a finding by OFR, acted in bad faith in terminating, suspending, or taking
similar action restricting account access. The aggrieved customer or member may recover damages in
any court of competent jurisdiction, together with costs and reasonable attorney fees to be assessed by
the court.
To recover damages, however, the customer or member must establish that, beyond a reasonable
doubt, the financial institution acted in bad faith in terminating, suspending, or taking similar action
restricting access to the customer’s or member’s account. The bill provides that OFR’s determination
that the financial institution has acted in bad faith does not, in and of itself, establish beyond a
reasonable doubt that the financial institution acted in bad faith in the termination, suspension, or
similar action restricting account access.
The bill provides that a customer’s or member’s failure to initiate a cause of action within 12 months of
OFR making a bad faith determination shall bar recovery of any filed claims thereafter.
Qualified Public Depositories
The bill also amends the list of activities that are grounds for suspension or disqualification or both for a
QPD. Specifically, the bill provides that a QPD who is found by OFR to have acted in bad faith when
terminating, suspending, or taking similar action restricting a customer’s or member’s account, or who
has failed to cooperate in an investigation conducted pursuant to proposed s. 655.49, F.S. (including,
without limitation, failing to timely file a termination-of-access report), is grounds for suspension or
disqualification or both.
The bill provides that, with respect to administrative penalties imposed in lieu of suspension or
disqualification, a QPD’s bad faith termination, suspension, or similar action restricting a customer’s or
member’s account access (as determined by OFR), or a QPD’s failure to cooperate in an investigation
conducted pursuant to proposed s. 655.49, F.S. (including, without limitation, failure to timely file a
termination-of-access report), are each deemed a knowing and willful violation by the QPD.
Division of Workers’ Compensation
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Florida’s Workers’ Compensation Law 74 requires employers to provide injured employees all medically
necessary remedial treatment, care, and attendance for such period as the nature of the injury or the
process of recovery may require.75 DFS provides regulatory oversight of Florida’s Workers’
Compensation system, including the Workers’ Compensation health care delivery system. The law
specifies certain reimbursement formulas and methodologies to compensate Workers’ Compensation
health care providers 76 that provide medical services to injured employees. Where a reimbursement
amount or methodology is not specifically included in statute, the Three-Member Panel (Panel) is
authorized to annually adopt statewide schedules of maximum reimbursement allowances (MRAs) to
provide uniform fee schedules for the reimbursement of various medical services. 77 DFS incorporates
the MRAs approved by the Three-Member Panel in reimbursement manuals 78 through the rulemaking
process provided by the Administrative Procedures Act.79 In 2023, the Legislature eliminated the
authority of the Three-Member Panel to adopt MRA’s for individually licensed health care providers,
work-hardening programs, pain programs, and durable medical equipment providers. 80 Instead, DFS
must annually publish the maximum reimbursement allowance for physician and non-hospital
reimbursements on its website by July 1st , effective the following January 1st .81
Reimbursement for Healthcare Providers
The Panel, which consists of the CFO or his or her designee and two Governor’s appointees, sets the
MRAs for hospital reimbursement.82 Beginning with rates developed in 2024, and implemented with
rates effective January 1, 2025, health care providers and non-hospital rates are annually published by
DFS, instead of being included in the reimbursement manuals.83 DFS incorporates the statewide
schedules of the MRAs through rulemaking. In establishing the MRA manual, the panel considers the
usual and customary levels of reimbursement for treatment, services, and care;84 the cost impact to
employers for providing reimbursement that ensures that injured workers have access to necessary
medical care; and the financial impact of the MRAs on healthcare providers and facilities. 85 Florida law
requires the panel to develop MRA manuals that are reasonable, promote the workers’ compensation
system’s healthcare cost containment and efficiency, and are sufficient to ensure that medically
necessary treatment is available for injured workers.86
There are three different reimbursement manuals that determine statewide schedules of maximum
reimbursement allowances. The healthcare provider manual, developed by the Division of Workers’
Compensation, limits the maximum reimbursement for licensed physicians to 110 percent of Medicare
reimbursement,87 while reimbursement for surgical procedures is limited to 140 percent of Medicare. 88
The hospital manual, developed by the panel, sets maximum reimbursement for outpatient scheduled
surgeries at 60 percent of usual and customary charges, 89 while other outpatient services are limited to
75 percent of usual and customary charges.90 Reimbursement of inpatient hospital care is limited
based on a schedule of per diem rates approved by the panel. 91 The ambulatory surgical centers
manual, developed by the panel, limits reimbursement to 60 percent of usual and customary as such
74 Ch. 440, F.S.
75 S. 440.13(2)(a), F.S.
76
The term “health care provider” includes a physician or any recognized practitioner licensed to provide skilled services purs uant to a
prescription or under the supervision or direction of a physician. It also includes any hospital licensed under ch. 395 and any health care
institution licensed under ch. 400 or ch. 429. S. 440.13(1)(g), F.S.
77 S. 440.13(12), F.S.
78 Ss. 440.13(12) and (13), F.S., and r. 69L-7, F.A.C.
79
Ch. 120, F.S.
80 Ch. 2023-144, Laws of Fla.
81 Id.
82 Id.
83 Ch. 2023-144, Laws of Fla.
84 S. 440.13(12)(i)(1), F.S.
85 S. 440.13(12)(i)(2), F.S.
86 S. 440.13(12)(i)(3), F.S.
87 S. 440.13(12)(f), F.S.
88 S. 440.13(12)(g), F.S.
89 S. 440.13(12)(d), F.S.
90 S. 440.13(12)(a), F.S.
91 Id.
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services are generally scheduled outpatient surgeries. The prescription drug reimbursement manual
limits reimbursement to the average wholesale price plus a $4.18 dispensing fee. 92 Repackaged or
relabeled prescription medication dispensed by a dispensing practitioner has a maximum
reimbursement of 112.5 percent of the average wholesale price plus an $8.00 dispensing fee. 93 Fees
may not exceed the schedules adopted under Ch. 440, F.S., and department rule.94
Effect of the Bill
The bill establishes that reimbursement for emergency services and care, excluding those subject to a
maximum reimbursement allowance, must be 250 percent of Medicare rates, unless governed by a
contract. Additionally, it requires DFS to collaborate with an actuarial services firm to develop maximum
reimbursement allowances for services falling under this provision. This provision will expire on June
30, 2026.
Additionally, the bill gives DFS rulemaking authority.
Florida Self-Insurers Guaranty Association, Inc.
An employer may be eligible to self-insure for their Workers’ Compensation coverage.95 Such an
employer must furnish proof to the Florida Self-Insurers Guaranty Association (FSIGA) that the
employer has the financial strength necessary to ensure timely payment of all current and future
claims.96 The FSIGA is a nonprofit corporation established pursuant to s. 440.385, F.S., and monitors
the financial strength of self-insured entities for DFS and makes recommendations as to the
qualifications to self-insure.97 All self-insurers other than governmental entities and public utilities are
required to be members of the FSIGA.98
Effect of the Bill
The bill amends regulations concerning the Florida Self-Insurers Guaranty Association. Starting July 1,
2024, all contracts valued at $100,000 or more, entered into by the association, must receive prior
approval from DFS. DFS is mandated to approve or deny the contract within ten days; otherwise, it is
considered approved. Competitive procurement is required for all such contracts, with awards granted
to the most responsible and responsive vendor. Contracts required by law are not subject to the
provisions outlined in this bill.
Florida Funeral, Cemetery, and Consumers Services Act
Chapter 497, F.S., known as the Florida Funeral, Cemetery, and Consumer Services Act (Funeral Act),
generally regulates funeral and cemetery services. 99 The Funeral Act authorizes the Board of Funeral,
Cemetery, and Consumer Services (Board) within DFS to regulate cemeteries, columbaria,100
cremation services, mausoleums, cemetery companies, dealers and monument builders, funeral
directors, and funeral establishments.101
The Board oversees licensing and rulemaking for the death care industry, including examinations and
facility standards.102 It holds authority over various licensure aspects, such as criteria and practical
92 S. 440.13(12)(h), F.S.
93 Id.
94 S. 440.13(12)(f), F.S.
95 S. 440.38(1)(b), F.S.
96 Id.
97 Id.
98 S. 440.385(1)(a), F.S.
99 S. 497.001, F.S.
100 “Columbarium” means a structure or building that is substantially exposed above the ground and that is intended to be used for the
inurnment of cremated remains. S. 497.005(18), F.S.
101 See ss. 497.101 and 479.103, F.S.
102 S. 497.101 and 497.103, F.S.
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examinations, including content, grading, and time limits. The Board is comprised of ten members,
including the State Health Officer and nine individuals appointed by the Governor. 103 The composition
of the Board includes funeral directors, cemetery associates, consumers, and a monument
establishment principal. Members serve four-year terms, ensuring diverse representation and
preventing conflicts of interest.104
Effect of the Bill
The bill introduces changes to the Board of Funeral, Cemetery, and Consumer Services. The changes
include:
The CFO, rather than the Governor, will appoint Board members.
The funeral director member is no longer conditioned on owning or operating an approved
cinerator facility.
Board members may be reappointed but are limited to serving no more than 8 consecutive
years.
Members are specifically held subject to the code of ethics under part III of ch. 112, F.S.
Board members cannot vote on measures for their private gain or loss.
A board member may not knowingly accept gifts or expenditures from entities under
consideration for a contract or licensed by DFS.
Board meetings must comply with open meeting requirements, and all records are open to the
public for inspection.
Notice of Board meetings, except for emergencies, must be published by DFS on the Board’s
website at least seven days before the meeting. The agenda, arranged by presentation order,
must also be published at least seven days in advance, with changes allowed only for good
cause after the agenda release.
The bill amends disciplinary procedures and penalties for board members specifying that if certified
mail service of an administrative complaint on a licensee cannot be achieved at the last address
provided to DFS, service may be carried out by email. The email should be sent with delivery receipt
required to the most recent email address provided to DFS by the licensee in accordance with s.
497.146, F.S.
Additionally, the bill modifies procedures for disciplinary citations and minor violations, stipulating that if
certified mail service of a citation on a subject cannot be accomplished at the last address provided to
DFS, then service may be conducted by email. The email should be sent with delivery receipt required,
directed to the most recent email address provided to DFS by the subject in accordance with s.
497.146, F.S.
Disclosure of Confidential and Exempt Information by DFS
The bill specifies circumstances under which confidential and exempt information may be disclosed by
the department, including to the probable cause panel of the board for probable cause proceedings, to
law enforcement or government agencies for official duties, for matters of immediate public health,
safety, or welfare concern, and if the department issues an emergency order.
Regulations on Storage, Preservation, and Transportation of Human Remains
The bill prohibits storing human remains at any establishment or facility not licensed under ch. 497,
except for specific designated facilities. Additionally, it sets guidelines for the timeframe and conditions
under which human bodies may be held after death, mandates proper transportation measures, and
requires the licensing authority to establish minimal standards for handling and storing human remains.
Furthermore, it grants the Department authority to intervene and remove human remains in emergency
103 S. 497.103(1)(a)-(g), F.S.
104 S. 497.101(3), F.S.
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situations, absolving licensees from liability in such cases. Violations of these regulations incur
misdemeanor or felony charges, depending on the severity of the offense.
Procedures for Fulfillment of Preneed Contracts
The bill establishes protocols for the fulfillment of preneed contracts, stating that upon delivery of
merchandise or services, a preneed licensee can withdraw the deposited amount plus earned income,
with adequate documentation. It specifies acceptable evidence of contract fulfillment, including a
certified death certificate, invoice reflecting purchaser or beneficiary information, acknowledgment of
delivery or services, or relevant governmental documentation. Additionally, it mandates that preneed
licensees maintain fulfillment documentation until reviewed by the department.
Service of Process
In general, the law provides for the designation of a public officer, board, agency, or commission as the
agent for service of process on a person, firm, or corporation in the state.105 However, the state CFO is
designated as the agent for service of process on insurers and other specific entities or persons
licensed by DFS or the Office of Insurance Regulation (OIR). OIR provides oversight for specified
insurance products, insurers and other risk bearing entities in Florida. 106 The Financial Services
Commission (FSC), composed of the Governor, the Attorney General, the CFO, and the Commissioner
of Agriculture, serves as agency head of the Office of Insurance Regulation for purposes of rulemaking.
Further, the FSC appoints the commissioner of the Florida Office of Insurance Regulation. 107 Service of
process on the CFO is made by mail, personal service, or via DFS’s e-portal.108
After receiving service of process, the CFO is required to promptly send a copy by registered or
certified mail, or by any other verifiable means, to the person designated by an insurer to receive the
process.109 Verifiable means includes making the documents available by electronic transmission from
a secure website established by DFS.110 If DFS makes the documents available electronically, the CFO
is required to send a notice of receipt of process to the person designated by the insurer being served
to receive legal process.111
Service is considered perfected on an insurer when the CFO is served with the process. 112 Although an
insurer is not required to respond to a lawsuit except until 20 days after the CFO sends or makes a
copy of the process available, the triggering date for other legal deadlines is the date the CFO is served
with process.113 This can create problems for an insurer when a delay occurs between the time the
CFO is served and the time the CFO notifies the insurer of the service of process.
Surplus Lines Insurers
Surplus lines insurance is coverage for specific risks that the standard or admitted market is either unable
or unwilling to cover.114 While the admitted market is where most consumers find coverage, the surplus
lines market is a supplement for those individuals and businesses that cannot find coverage otherwise.115
Florida law defines “eligible surplus lines insurer” as an unauthorized insurer which has been made
eligible by the OIR to issue insurance coverage under the Surplus Lines Law. 116
105 S. 48.151, F.S.
106
S. 20.121(3)(a), F.S.
107 Id.
108 Id. DFS, https://myfloridacfo.com/division/generalcounsel/service-of-process (last visited Jan. 23, 2024).
109 S. 624.423, F.S.
110 S. 624.307(9), F.S.
111 Id.
112 S. 624.423(3), F.S.
113 S. 624.423(2), F.S.
114 Florida Surplus Lines Service Office, Surplus Lines Insurance, https://www.fslso.com/about/surplus-lines-
insurance#:~:text=Surplus%20lines%20insurance%20is%20coverage,that%20cannot%20find%20coverage%20otherwise (last visited
Jan. 23, 2024).
115 Id.
116 S. 626.915, F.S.
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Effect of the Bill
The bill requires eligible surplus lines insurers to provide a written or electronic response to the Division
of Consumer Services within DFS within 14 days of receiving a written request for documents and
information related to a consumer complaint.
Additionally, the bill requires that authorized insurers and eligible surplus lines insurers submit email
addresses to DFS for directing requests related to consumer complaints. The insurer is required to
designate a contact person to DFS for escalated complaint issues, providing the name, email address,
and telephone number of the designated contact person.
Division of Insurance Agent and Agency Services
DFS Division of Insurance Agent and Agency Services is responsible for the licensing and regulation of
insurance agents, adjusters, insurance agencies, as well as related personnel and business entities. 117
No person may be, act as, or advertise, or hold himself or herself out to be an insurance agent,
insurance adjuster, or customer representative unless he or she is currently licensed by DFS and
appointed by an appropriate appointing entity or person. 118 There are several types of insurance
representatives. These include:
General lines agents,
Life insurance agents,
Health insurance agents,
Title insurance agents,
Personal lines agents, and
Unaffiliated insurance agents.119
General Lines Agent
A general lines agent120 is one who sells the following lines of insurance: property; 121 casualty,122
including commercial liability insurance underwritten by a risk retention group, a commercial self-
insurance fund,123 or a Workers’ Compensation self-insurance fund;124 surety;125 health;126 and,
marine.127 The general lines agent may only transact health insurance for an insurer that the general
lines agent also represents for property and casualty insurance. If the general lines agent wishes to
represent health insurers that are not also property and casualty insurers, they must be licensed as a
health insurance agent.128
Title Agents and Agencies
Title insurance insures owners of real property (owner’s policy) or others having an interest in real
property, as well as lenders (mortgagee policies) against loss by encumbrance, defective title,
invalidity, or adverse claim to title. It is a policy issued by a title insurer that, after evaluating a search of
title, insures against a number of covered risks, including title defects or liens that are not identified as
117 Ch. 626, parts I-IX, and XIII.
118 S. 626.112, F.S.
119 S. 626.015, F.S.
120 S. 626.015(5), F.S.
121 S. 624.604, F.S.
122 S. 624.605, F.S.
123 As defined in s. 624.462, F.S.
124 Pursuant to s. 624.4621, F.S.
125 S. 626.606, F.S.
126 Ss. 624.603 and 627.6482, F.S.
127 S. 624.607, F.S.
128 S. 626.829, F.S.
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exceptions. In Florida, title insurers operate on a monoline basis, meaning that the insurer can only
transact title insurance and cannot transact any other type of insurance. 129
Effect of the Bill
The bill
Requires DFS to allow applicants to submit cellular telephone numbers as part of the
application process on a voluntary basis for purposes of two-factor authentication130 of login
credentials only. A separate bill, HB 991, which is linked to the passage of the bill, proposes to
exempt these phone numbers from public records requirements.
Adds “Registered Claims Adjuster (RCA) from American Insurance College” to the list of
individuals exempted from the examination requirement to become an agent or adjuster.
Allows DFS to disclose confidential investigative information to the subject or the subject’s
representative in order to review the details of the investigation.
Adds designation of “Chartered Customer Service Representative (CCSR) from American
Insurance College” to the list of criteria to qualify as a customer representative.
Insurance Adjusters
Florida law requires all insurance adjusters to be licensed by DFS and appointed by the appropriate
entity or person131 in order to adjust claims. General requirements for licensure include submitting an
application; paying required fees; satisfying pre-licensing examination requirements, when applicable;
complying with requirements as to knowledge, experience, or instruction; and submitting fingerprints.132
Under s. 626.864, F.S., there are both public adjusters and all-lines adjuster license types, with all-lines
appointments further divided into independent adjusters, 133 company employee adjusters,134 and public
adjuster apprentices.135 The same adjuster may not be concurrently licensed as a public adjuster and
an all-lines adjuster.136 In the case of an all-lines adjuster, the adjuster may be appointed as an
independent adjuster, company employee adjuster, or public adjuster apprentice, but not more than
one concurrently.137
A public adjuster is any person, other than a licensed attorney, who, for compensation, prepares,
completes, or files an insurance claim form for an insured or third-party claimant in negotiating or
settling an insurance claim on behalf of an insured or third party. 138 Public adjusters operate
independently and are not affiliated with any insurer.
An all-lines adjuster is any person who, for compensation, ascertains and determines the amount of
any claim, loss, or damage payable under an insurance contract or settles such claim, loss, or damage
on behalf of a public adjuster or insurer.139
129 S. 627.786, F.S.
130 Two-factor authentication (TFA) is an identity and access management security method that requires two forms of identification to
access resources and data. TFA gives businesses the ability to monitor and help safeguard their most vulnerable information a nd
networks. Microsoft, What is Two-Factor Authentication?, https://www.microsoft.com/en-us/security/business/security-101/what-is-two-
factor-authentication-2fa (last visited Jan. 22, 2024).
131 See s. 626.015(4), F.S., defining “appointment” as the authority given by an insurer or employer to a licensee to adjust c laims on
behalf of an insurer or employer.
132 S. 626.171, F.S.
133 S. 626.855, F.S.
134 S. 626.856, F.S.
135 S. 626.8561, F.S.
136 S. 626.864(2), F.S.
137 S. 626.864(3), F.S
138 S. 626.854(1), F.S.
139 S. 626.8548, F.S.
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An independent adjuster is any person who is self-employed or employed by an independent adjusting
firm and who works for an insurer to ascertain and determine the amount of an insurance claim, loss, or
damage, or to settle an insurance claim under an insurance contract. 140
A company employee adjuster is any person employed in-house by an insurer, or a wholly owned
subsidiary of the insurer, who ascertains and determines the amount of an insurance claim, loss, or
damage, or settles such claim, loss, or damage.141
Effect of the Bill
The bill mandates licensed adjusters to clearly identify themselves in all advertisements, solicitations, or
written documents, reflecting their specific adjuster appointment type.
Additionally, an adjuster whose license has been revoked or suspended is expressly prohibited from
participating in any aspect of an insurance claim or the insurance claim adjusting process.
Unauthorized Insurers and Surplus Lines
A general lines agent, when licensed and appointed as a surplus lines agent, is authorized to initiate
and accept surplus lines business from any other originating Florida-licensed general lines agent
appointed and licensed for the relevant kinds of insurance, and may receive compensation
accordingly.142 Similarly, a managing general agent, when licensed and appointed as a surplus lines
agent, can accept and place surplus lines business originated by a Florida-licensed general lines agent,
and may compensate that agent.143 General lines agents may not knowingly misrepresent any material
fact related to such insurance or its eligibility for placement with a surplus lines insurer. 144
Effect of the Bill
The bill specifies that a general lines agent, while licensed as a surplus lines agent, is authorized to
appoint licenses using a single surplus license agent appointment under s. 624.501, F.S. This
appointed agent is limited to initiating surplus lines business and receiving surplus lines business
exclusively from other Florida-licensed general lines agents who are appointed and licensed for the
relevant kinds of insurance. Such agents are not eligible for appointment by or allowed to engage in
transacting general lines insurance on behalf of an admitted insurer. Compensation may be provided to
such agents.
Florida Medical Malpractice Joint Underwriting Association
The Florida Medical Malpractice Joint Underwriting Association (FMMJUA) is a legislatively established
risk apportionment plan designed to ensure the availability of medical liability (malpractice) insurance
for various Florida health care providers, including physicians, surgeons, dentists, nurses, physician
partnerships or corporations, hospitals, medical facilities, and others. 145 The FMMJUA serves as a
provider of liability insurance for medical practitioners who face challenges obtaining coverage from the
private market.146
Administered by its Board of Governors, composed of representatives from key entities such as the
Florida Medical Association, Florida Hospital Association, The Florida Bar, Florida Dental Association,
and the insurance industry, the FMMJUA operates under the framework of the FMMJUA Plan of
140 S. 626.855, F.S.
141 S. 626.856, F.S.
142 S. 626.929(1), F.S.
143 S. 626.929(2), F.S.
144 S. 626.929(3), F.S.
145 S. 627.351, F.S. See also www.fmmjua.com (last visited Jan. 20, 2024).
146 Id.
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Operation.147 The Board, with OIR approval, oversees crucial aspects like insurance rates, rate
classifications, policy forms, and overall policy setting. 148
Effect of the Bill
The bill requires that, starting July 1, 2024, the FMMJUA must obtain prior approval from DFS for all
contracts valued at $100,000 or more. DFS is obligated to render a decision on the contract within ten
days; failure to do so will result in the contract being deemed approved. Competitive procurement is a
requisite for all such contracts, and awards are to be granted to the most responsible and responsive
vendor.
Guaranty Associations
A guaranty association is typically a nonprofit corporation established by law to safeguard policyholders
against financial losses and delays in claim payment and settlement resulting from the insolvency of an
insurance company.
Florida Insurance Guaranty Association
Section 631.55, F.S., establishes the Florida Insurance Guaranty Association, Inc. (FIGA). In the event
of insolvency of a property and casualty insurance company, FIGA is mandated to take over the claims
and fulfill obligations to the policyholders of the insolvent insurer. 149 Participation in FIGA is a
mandatory requirement for all insurers licensed to sell property and casualty insurance in Florida. 150
Operating as a nonprofit corporation, FIGA is governed by a Board of Directors appointed by DFS, with
each member serving a four-year term.151
Effect of the Bill
The bill requires that, starting July 1, 2024, FIGA must seek prior approval from DFS for all contracts
valued at $100,000 or more, with the exception of contracts involving defense counsel and claim
administrators. DFS is required to decide on the contract within ten days; failure to do so will result in it
being deemed approved. Competitive procurement is a prerequisite for all such contracts, and awards
are to be directed to the most responsible and responsive vendor.
Florida Life and Health Insurance Guaranty Association
Section 631.715, F.S., establishes the Florida Life and Health Insurance Guaranty Association
(FLHIGA). Every insurer licensed to sell direct life insurance policies, health insurance policies, annuity
contracts, and supplemental contracts in the state must participate in FLHIGA as a requirement for
conducting business in Florida.152 FLHIGA functions as a nonprofit corporation, governed by a Board of
Directors consisting of nine to eleven members appointed by member insurers. 153
Effect of the Bill
The bill requires the FLHIGA to obtain approval from DFS for all contracts valued at $100,000 or more,
initiated by the association after July 1, 2024. DFS is mandated to make a decision on the contract
within ten days; otherwise, it is deemed approved. Competitive procurement is a requirement for all
such contracts, with awards directed to the most responsible and responsive vendor.
147 Id.
148 Id.
149 S. 631.57, F.S.
150 S. 631.56(1), F.S.
151 Id.
152 S. 631.716(1), F.S.
153 Id.
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Florida Health Maintenance Organization Consumer Assistance Plan
Section 631.815, F.S., provides for the creation of the Florida Health Maintenance Organization
Consumer Assistance Plan (FHMOCAP). All health maintenance organizations possessing a valid
certificate of authority in the state are required to participate in the FHMOCAP as a condition of
transacting business in Florida. The FHMOCAP operates under a board of directors as a nonprofit
corporation. The Board consists of five to nine members appointed by DFS to serve four-year terms.154
Effect of the Bill
The bill requires the FHMOCAP to obtain approval from DFS for all contracts valued at $100,000 or
more, initiated by the association after July 1, 2024. DFS is mandated to make a decision on the
contract within ten days; otherwise, it is deemed approved. Competitive procurement is a requirement
for all such contracts, with awards directed to the most responsible and responsive vendor.
Florida Workers’ Compensation Insurance Guaranty Association
Section 631.911, F.S., provides the creation of the Florida Workers’ Compensation Insurance Guaranty
Association, Incorporated (FWCIGA). All insurers authorized to provide workers’ compensation
insurance in the state are required to participate in the FWCIGA as a condition of transacting business
in Florida. The FWCIGA operates under a board of directors as a nonprofit corporation. The Board
consists of eleven members appointed to serve four-year terms.155
Effect of the Bill
The bill requires the FWCIGA to obtain approval from DFS for all contracts valued at $100,000 or more,
initiated by the association after July 1, 2024. DFS is mandated to make a decision on the contract
within ten days; otherwise, it is deemed approved. Competitive procurement is a requirement for all
such contracts, with awards directed to the most responsible and responsive vendor.
State Fire Marshal
The CFO serves as the State Fire Marshal, operating through the Division of the State Fire Marshal
within DFS.156 Under this authority, the State Fire Marshal regulates, trains, and certifies fire service
personnel; investigates the causes of fires; enforces arson laws; oversees the installation of fire
equipment; conducts fire safety inspections of state property; develops fire safety standards; provides
facilities for the analysis of fire debris; and manages the Florida State Fire College. 157
Uniform Fire Safety Standards
DFS is mandated to establish uniform fire safety standards applicable to various entities, including
state-owned and state-leased buildings, hospitals, nursing homes, assisted living facilities, adult family-
care homes, correctional facilities, public schools, transient public lodging establishments, public food
service establishments, elevators, migrant labor camps, mobile home parks, lodging parks, recreational
vehicle parks, recreational camps, residential and nonresidential child care facilities, facilities for the
developmentally disabled, motion picture and television special effects productions, tunnels, and self-
service gasoline stations.158
These standards must be reasonably prudent in safeguarding life, safety, and property, considering the
characteristics of individuals using these buildings and structures and other associated hazards across
154 S. 631.816(1), F.S.
155 S. 631.912(1), F.S.
156 S. 633.104, F.S.
157 S. 633.128(h), F.S.
158 S. 633.206(1), F.S.
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the state.159 Local authorities are generally restricted from imposing more stringent uniform fire safety
standards, except in limited circumstances.160
Effect of the Bill
The bill adopts the National Fire Protection Association, Inc., Standard 1126, 2021 Edition, Standard for
the Use of Pyrotechnics before a Proximate Audience. This replaces the 2001 Edition and is the most
current edition.
The bill requires that the State Fire Marshal cannot adopt an accessibility code, as accessibility is
already addressed within the Florida Building Code's Americans with Disabilities Act accessibility
provisions.
Additionally, the bill mandates DFS to establish consistent fire safety standards for both mobile food
dispensing vehicles and energy storage systems.
Motor Vehicle Service Agreement Companies
To engage in service agreement161 business activities in Florida, a person must hold a license and
adhere to various requirements under applicable laws, including the Florida Insurance Code. 162 These
requirements include maintaining solvency, demonstrating competent and trustworthy management,
making specified deposits, maintaining reserves, and ensuring a minimum net asset requirement of
$500,000.163 Additionally, a service agreement company may establish an unearned premium reserve
or secure contractual liability insurance meeting certain criteria. 164 If using contractual liability insurance,
the policy must cover 100 percent of claim exposure, ensure refund obligations, provide 90 days’ notice
for cancellation, and furnish claims statistics to the OIR. 165 Such policies can pay claims as incurred or
in the event of the company's failure to meet payment obligations. 166
Effect of the Bill
The bill permits motor vehicle service agreement companies to employ multiple contractual liability
insurance policies to support their financial obligations.
Home Warranty Associations
A home warranty is a contract or agreement between the homeowner and the issuing company,
safeguarding the homeowner from expenses related to the repair or replacement of structural
components or appliances in the home.167 This protection extends to issues caused by normal wear
and tear or defects in these components or appliances. 168
159 S. 633.206(2)(a), F.S.
160 S. 633. 206(2)(b), F.S.
161
S. 634.011(8), F.S., defines “motor vehicle service agreement” or “s ervice agreement” as a contract or agreement indemnifying the
service agreement holder for the motor vehicle listed on the service agreement and arising out of the ownership, operation, a nd use of
the motor vehicle against loss caused by failure of any mechanical or other component part, or any mechanical or other component part
that does not function as it was originally intended. However, nothing in this part shall prohibit or affect the giving, free of charge, of the
usual performance guarantees by manufacturers or dealers in connection with the sale of motor vehicles. Transactions exempt under s.
624.125, F.S., are expressly excluded from this definition and are exempt from the provisions of this part.
162 S. 634.031(1), F.S.
163 S. 634.041, F.S.
164 Id.
165 S. 634.041(8)(b)6., F.S.
166 Id.
167 S. 634.301(2), F.S.
168 Id.
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Home warranty contracts or agreements can be drafted by a Home Warranty Association licensed
under s. 634.303, F.S., or by an authorized insurance company permitted to offer coverage in this
category.169
The elective market in Florida allows a builder, seller, buyer, or owner of a home to choose whether
they would like to purchase a home warranty to cover against the cost of repair or replacement, or
furnishes repair or replacement, of any structural component or appliance of a home, caused by wear
and tear or a defect of a structural component or appliance. 170
Warranty associations and companies in Florida, including those associations selling home and service
warranties, and those companies selling motor vehicle service agreements, are regulated by the
OIR.171
While warranties are not considered traditional insurance products, OIR regulates warranty
associations and companies similarly to the way in which it regulates insurers.172 Home and service
warranty associations must be licensed by OIR 173 and must maintain certain minimum financial
standards in order to do warranty business in Florida.174
Effect of the Bill
The bill specifies that home warranty associations are not obligated to establish an unearned
premium 175 reserve or maintain contractual liability insurance. The association may allow premiums to
exceed the ratio to net assets limitation under the following conditions:
The association or its parent corporation, if applicable, must maintain a minimum net worth
of at least $100 million and provide the OIR with:
o Annual audited financial statements or audited consolidated financial statements
demonstrating the required net worth.
o A quarterly written certification of the continuing net worth maintenance.
Submission of required documents, including Form 10-K, Form 10-Q, or Form 20-F, to the
OIR on a quarterly and annual basis.
Failure to timely file the necessary documents may result in the association facing suspension or
revocation of its license.
If the net worth of a parent corporation is used to satisfy the net worth provisions:
The parent corporation must guarantee all service warranty obligations, subject to OIR
approval.
Cancellation, termination, or modification of the guarantee requires a 90-day notice to the
OIR.
The association must demonstrate compliance with all provisions before the effective date of
any changes to the guarantee.
If compliance is not demonstrated, the association must cease writing new and renewal
business.
169 S. 634.303, F.S.
170 S. 634.301(2), F.S.
171 See ch. 634, F.S.
172 See ch. 634, F.S.
173 Ss. 634.303 and 634.403, F.S. Neither the Florida Insurance Code (FIC) nor this section grants permission for any home warranty
association to conduct insurance business beyond what is specifically defined as home warranty or to participate in any other form of
insurance. Sale of alternative insurance types requires explicit authorization through a certificate of auth ority issued by the office under
the provisions of the FIC. S. 634.325, F.S.
174 Ss. 634.3077 and 634.406, F.S.
175 Unearned premiums are parts of the insurance premiums that are collected in advance by the insurers. The insurer is subject t o
refund the unearned premium if the insured decides to terminate the policy before the policy period ends. Clear Tax, What is Unearned
Premium?, https://cleartax.in/glossary/unearned-premium/ (last visited Jan 23, 2024).
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The bill also provides an exemption for employees and agents of municipal or county governments from
the licensing and appointment requirements specified in s. 634.317, F.S.
Bail Bonds
A bail bond is a guarantee by a third-party that a defendant in a criminal case will appear in court at all
scheduled proceedings. A bail bond agent posts a surety bond to secure the defendant’s release from
custody; the defendant provides money or other collateral to secure the bail bond and forfeits the
premium (10 percent of the amount of bail set by the court) if he or she fails to appear in court or
comply with other conditions of the bond. Bail bond agents must be licensed by DFS and appointed by
insurance carriers to execute bail bonds. If a defendant fails to appear in court, the bail bond agent may
apprehend and detain the defendant until the defendant is surrendered to the authorities. 176
Bail bond agents may execute or sign bonds, handle collateral receipts, deliver bonds to appropriate
authorities, or operate an agency or branch agency at a separate location from the supervising bail
bond agent, managing general agent, or insurer that employs the bail bond agent. 177
Licensure as a Bail Bond Agent
All applicants for bail bond licenses must submit fingerprints for a national criminal background check
and pay an application fee.178 Bail bond agents may not have been convicted of a felony, must be age
18 or older, and must be eligible to work in the United States.179 A bail bond agent must be appointed
by a licensed insurer and the insurer must report the appointment to DFS. 180 A bail bond agent may not
charge a premium other than the rate that has been approved by OIR, and must retain records related
to any bail bonds the agent has executed or countersigned for at least three years after the liability of
the surety has been terminated.181 Additionally, bail bond agents must register with the sheriff and the
clerk of the circuit court in the county where the bail bond agent resides.182 Bail bond agents may not
solicit clients at a jail, prison, or courthouse, and may not pay fees for referrals from any person working
in the law enforcement community.183
Ownership of a Bail Bond Agency
The owner of a bail bond agency must hold a valid license and appointment as a bail bond agent. 184
Additionally, the owner or operator of the agency is required to appoint a primary bail bond agent,
responsible for the overall operation and management of a specific agency location. 185 The name and
license number of the primary bail bond agent, along with the agency's address, must be filed with
DFS.186 A primary bail bond agent can supervise only one location, has the authority to hire employees,
and is prohibited from employing or contracting with individuals who have been convicted of a felony. 187
Continuing Education
Bail bond agents are required to complete a minimum of 14 hours of continuing education every two
years.188 Approved schools providing continuing education must be certified by DFS, offering a
176 Ss. 648.24 and 624.26, F.S. Also see DFS, Division of Consumer Services, Bail Bonds Overview, https://www.myfloridacfo.com/bail-
bonds-overview (last visited Jan. 20, 2024).
177 S. 648.355, F.S.
178 Id.
179 S. 648.34, F.S.
180 S. 648.30, F.S.
181 Ss. 648.295 and S. 648.36, F.S.,
182 S. 648.42, F.S.
183 S. 648.44, F.S.
184 S. 648.285, F.S.
185 Id.
186 Id.
187 S. 648.25(6) and 648.387, F.S.
188 S. 648.385, F.S.
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minimum of three classroom-instruction classes per calendar year.189 Each continuing education class
should include at least two hours of approved coursework and be taught by a DFS-approved
supervising instructor.190
Effect of the Bill
The bill provides the following definitions:
“Referring bail bond agent” is the limited surety agent who is appointed with the surety company
issuing the transfer bond that is to be posted in a county where the referring limited surety agent
is not registered. The referring bail bond agent is the appointed agent held liable for the transfer
bond, along with the issuing surety company.
“Transfer bond” means the appearance bond and power of attorney form posted by a limited
surety agent who is registered in the county where the defendant is being held in custody, and
who is appointed to represent the same surety company issuing the appearance bond as the
referring bail bond agent.
The bill requires that the papers, documents, reports, or any other records related to the regulation of
bail bonds, which are made confidential and exempt from public records law during an active
investigation by DFS, cease to be confidential once DFS or the OIR files a formal administrative
complaint, emergency order, or consent order against the individual or entity.
Additionally, the bill allows for the disclosure of confidential investigative records to the subject or their
representative for a detailed review.
Furthermore:
The bill eliminates the requirement for bail bond agents to be employed with a bail bond agency.
The bill removes the mandate for the submission of a full-face photograph with a limited surety's
or bail bond agent's license application.
The bill mandates the inclusion of the license number, along with the name and address, of the
referring bail bond agent on a transfer bond.
Florida Disposition of Unclaimed Property Act
As part of its statutory duties, DFS is mandated to collect and return unclaimed property to Florida
residents under ch. 717, F.S., known as the Florida Disposition of Unclaimed Property Act. Unclaimed
property refers to funds or other tangible and intangible assets that have remained unclaimed by the
owner for a specific period, encompassing various forms such as savings and checking accounts,
money orders, stocks, and more.191
Chapter 717, F.S., provides a framework for the rightful owners to obtain unclaimed property that is
held by DFS. Businesses, acting as holders of unclaimed property, are obligated to make reasonable
efforts to locate the owner.192 If these attempts prove unsuccessful, the businesses then report the
property, along with the owner's name, last known address, and other relevant details, to DFS. While
DFS serves as the custodian for the State of Florida, it does not assume legal ownership of the
property.193
To notify owners of their unclaimed property, DFS employs various methods, including database
searches.194 Citizens have the right to claim their property at any time, irrespective of the amount,
without incurring any costs.195 Unclaimed funds are deposited into the State School Fund to support
189 S. 648.386, F.S.
190 Id.
191 Ss. 717.104-717.116, F.S.
192 Id.
193 Id.
194 Florida Department of Financial Services, Agency Analysis of House Bill 425, p. 1 (Feb. 9, 2021).
195 Id.
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public schools.196 Importantly, the original amount reported as unclaimed can always be claimed by the
owner or their heirs at no cost.197
More than 326 licensed198 claimant’s representatives are registered with DFS to gain access to the
unclaimed property database and to seek authorizations from potential claimants of unclaimed property
held by DFS to file claims on behalf of those claimants.199 A claimant representative, who must be a
Florida-licensed attorney, a licensed Florida-certified public accountant (CPA), or a private investigator
licensed under Chapter 493, F.S., is required to register with DFS.200 A claimant representative must
register with DFS on a form designated by DFS and provide certain documentation (including tax
identification number, identification, electronic funds transfer information, business address, and
employees and agents) and credentials as to their status as an attorney, CPA, or private investigator.201
In order to move forward in obtaining unclaimed property on a potential client’s behalf, the
representative must first obtain that client’s authorization.
Effect of the Bill
Revised and New Definitions
The bill includes substantial changes to the law regarding unclaimed property. It significantly revises
some definitions and creates others so that the statutory definitions related to the unclaimed property
process will better apply to modern business and consumer practices.202 The updated definitions will
also account for new property types, technology advancements, electronic communications, and
consumer’s changing preferences regarding financial accounts. 203
The revisions to, and creation of, definitions in the bill include the following:
An unclaimed property related audit is defined as an action or proceeding to assist in
curbing the intentional delay of DFS audits of unclaimed property.
Audit agent is defined to differentiate between DFS’s employee auditors and auditors that
DFS contracts with for audit services to establish that the contracted auditors have authority
delegated by DFS.
A definition of claimant representative is created because of confusion regarding the role of
such people in the unclaimed property process.
Clarifications on Dormancy Period and Owner's Expression of Interest
The bill clarifies the dormancy period before property is presumed unclaimed and reported to DFS. 204 It
also designates what constitutes an owner’s expression of interest.
Virtual Currency and Reporting Requirements
The bill adds a definition of virtual currency to unclaimed property law and provides requirements on
how this type of property is to be reported and remitted to DFS when it is unclaimed. Virtual currency
must be reported to DFS on the annual report filed property holders file with DFS. Property holders
must liquidate virtual currency within 30 days before the filing of the report and remit the proceeds to
DFS.
196 Id.
197 Id.
198 Email from Chase Mitchell, Director of Legislative Affairs and Policy, DFS, Inquiry Regarding Licensed Claimant’s Representatives
Registration, (Jan. 22, 2024).
199 DFS, Agency Analysis of House Bill 425, p. 1 (Feb. 9, 2021).
200 S. 717.124, F.S.
201 S. 717.1400, F.S.
202 Department of Financial Services (DFS), Agency Analysis of 2024 House Bill 989, p.5 (Dec. 28, 2023). Many of these definition s
have not been updated since 1987.
203 Id.
204 Id. at p. 9.
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Property Holder Obligations
The bill provides that a property holder may not assign or otherwise transfer its obligation to report, pay,
or deliver property or to comply with unclaimed property law. Furthermore, an entity that acquires all or
substantially all of a property holder’s capital stock or assets is responsible for the reporting to DFS
unless otherwise agreed to by the parties.
Changes to Dormancy Period for Stock or Equity Interest
The bill also updates the time frames for determining whether stock or equity interest in a business
association is presumed to be unclaimed. Such stock or equity is presumed to be unclaimed after the
earliest of the following:
three years after any owner-generated activity;
three years after the death of the owner; or
one year after notice of the owner’s death is received by the holder.
Presumption of Unclaimed Property in Trusts
The bill establishes that all intangible property and associated income held in a fiduciary capacity under
a trust instrument are considered unclaimed unless certain actions are taken by the owner within two
years. These actions include increasing or decreasing the principal, accepting payment, communicating
regarding the property, or expressing interest through documented means. Additionally, the bill
specifies that these provisions do not exempt fiduciaries from their obligations under the Florida Trust
Code.
Lower Reporting Threshold and Notice to Owners
The bill aims to increase the number of searchable and claimable unclaimed property accounts. Instead
of the current reporting threshold of $50, the bill requires that property holders report to DFS the owner
and account information for unclaimed property valued at $10 or more.
The bill also makes changes to provide adequate notice to owners that their property has become
unclaimed and may be transferred to the custody of the state. It allows notice to be given by mail or
email. Such notice must contain a heading that informs the recipient that his or her property may be
transferred to DFS if they do not contact the property holder within 30 days after the date of the notice.
The bill establishes that a property holder’s substantial compliance with the reporting requirements for
unclaimed property and good faith payment of delivery of the property to DFS:
terminates any legal relationship between the holder and the owner with respect to the
property; and
releases and discharges the holder from liability to the owner or his heirs and
representatives.
A payment or delivery of property has been made in good faith if:
It was made in conjunction with an accurate and acceptable report.
It was made in a reasonable attempt to comply with ch. 717, F.S.
The holder had a reasonable basis for believing the property was unclaimed and subject to
ch. 717, F.S.
There is no showing that the records pursuant to which the delivery was made did not meet
reasonable commercial standards of practice in the industry.
Records Retention Period Extension
The bill increases the period of time for which property holders must retain records regarding reportable
property from five years to ten years. This aligns the records retention requirement with the number of
years within which DFS can bring an action to enforce unclaimed property law.
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DFS Authority
The bill provides DFS with the authority to refund or return the money or property to a person within five
years if it was remitted in error as long as the money or property has not been paid or delivered to a
claimant or otherwise disposed of according to unclaimed property law.
DFS Role in Probate Proceedings
The bill clarifies DFS’s authority when determining entitlement to unclaimed property that is part of
probate proceedings. DFS will be considered a party and provided with notice of proceedings as
provided for in the Florida Probate Code and Probate Rules. By becoming a party to the probate
proceedings, DFS should no longer have to disburse unclaimed property based upon court orders that
were issued based upon false information.
Threshold Increase for Small Estate Accounts
The bill increases the threshold for small estate accounts accompanied with a signed affidavit from
$10,000, to $20,000.
Tolling of 10-Year Enforcement Period
The bill clarifies that the 10-year period within which DFS may commence and action or proceeding to
enforce unclaimed property law is tolled by the earlier of:
DFS’s or its audit agent’s delivery of a notice that a holder is subject to an audit or
examination; or
the holder’s written election to enter into an unclaimed property voluntary disclosure
agreement.
Auditors' Fees, Investigations, and Examinations
Pursuant to the bill, auditors are allowed to deduct their fees from the property recovered or collected
under a contract for the location or collection of unclaimed property. In addition to audits, significant
changes and clarifications of DFS’s authority to conduct investigations and examinations are made in
the bill. Confidential information, including a property holder’s financial or proprietary information, may
not be disclosed until after an investigation or audit is completed, unless a court requires the disclosure
during a judicial proceeding.
Unclaimed Property Purchase, Electronic Signatures, and Exemption for Sale in Bankruptcy
The bill allows anyone to purchase unclaimed property as long as they comply with the other legal
requirements regarding recovery and purchase agreements. 205 It also eliminates the prohibition on
electronically signing a recovery agreement for claims above $2,000. The bill further provides that the
law regarding recovery and purchase agreements does not apply to the sale and purchase of Florida-
held unclaimed property accounts through a bankruptcy trustee appointed to represent a debtor’s
estate in a bankruptcy proceeding.
Florida Birth-Related Neurological Injury Compensation Association
Medical Malpractice Crisis
205 These requirements are found in s. 717.135, F.S.
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During the 1970s and 1980s, medical liability insurance in Florida had become so expensive that,
although technically available, it was functionally unavailable. 206 The Florida Legislature determined
that obstetrician-gynecologists (ob-gyns) disproportionately accounted for medical liability claims, both
in number of claims and amount of payout.207 Therefore, in 1986, the Legislature created a special task
force to study the Florida medical malpractice crisis and address the ob-gyn impact on that crisis.208
The task force evaluated the rising insurance costs and reported that litigation costs and attorney's fees
had increased between 1975 and 1986, but there was no particular change in substantive law to
account for the change.209 Moreover, some physicians became reluctant to treat high-risk patients and
practice certain high-risk specialties altogether.210 In 1985, ob-gyns in Florida paid an average medical
malpractice liability premium of $185,460, compared to a national average for ob-gyns of $23,300.211
Florida Birth-Related Neurological Injury Compensation Plan
The Florida Birth-Related Neurological Injury Compensation Plan (Plan) was part of the Legislature's
efforts to manage both rising medical malpractice costs and diminishing availability of liability insurance
by creating a hybrid no-fault and tort medical liability system.212 The Plan was created to pay for the
care of infants born with certain neurological injuries and is available to eligible families without the
need for litigation. By eliminating costly legal proceedings, the Plan aims to ensure that birth-injured
infants receive the care they need while reducing the financial burden on both medical providers and
families.
Florida Birth-Related Neurological Injury Compensation Association
In February 1988, the Legislature created the Florida Birth-Related Neurological Injury Compensation
Association (NICA) to manage the Plan.213 NICA is an independent association. Although it is not a
state agency, NICA is subject to regulation and oversight by the Office of Insurance Regulation (OIR)
and the Joint Legislative Auditing Committee. Directors on NICA’s board are appointed by the Chief
Financial Officer (CFO) for staggered terms of three years or until their successors are appointed, but
they may not serve more than six consecutive years on the board.214 The board of directors is
composed of:
One citizen representative.
One representative of participating physicians.
One representative of hospitals.
One representative of casualty insurers.
One representative of physicians other than participating physicians.
One parent or guardian representative of an injured infant under the plan.
One representative of an advocacy organization for children with disabilities.215
The board of directors may:
Administer the Plan.
Administer the funds collected on behalf of the Plan.
Administer the payment of claims on behalf of the Plan.
Direct the investment and reinvestment of any surplus funds over losses and expenses,
provided that any investment income generated thereby remains credited to the Plan.
Reinsure the risks of the Plan in whole or in part.
206 Sandy Martin, NICA - Florida Birth-Related Neurological Injury Compensation Act, 26 Nova L. R. 609 (2002),
https://core.ac.uk/download/pdf/51081713.pdf (last visited Feb. 20, 2024).
207
Id.
208 Id.
209 Id.
210 Id.
211
Id.
212 Id.
213 S. 766.315, F.S. and ch. 88-1, s. 74, Laws of Fla.
214 Id.
215 Id .
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Sue, be sued, appear, and defend in all actions relating to the Plan.
Exercise all powers necessary to effect any of the purposes for which the Plan is created.
Enter into such contracts as are necessary or proper to administer the Plan.
Employ or retain such persons as are necessary to perform the administrative and financial
transactions and responsibilities of the Plan.
Take such legal action as may be necessary to avoid payment of improper claims.
Indemnify any person acting on behalf of the Plan in an official capacity, provided that such
person acted in good faith.216
Annually, NICA must furnish audited financial reports to:
Any Plan participant upon request;
The OIR; and
The Joint Legislative Auditing Committee.217
The reports must be prepared in accordance with accepted accounting procedures. The OIR or the
Joint Legislative Auditing Committee may conduct an audit of the Plan at any time.218
Eligibility
An administrative law judge (ALJ) within the Florida Division of Administrative Hearings 219 hears all
claims under the Plan and determines whether a claim is compensable.220 To qualify, there must have
been a birth injury to the brain or spinal cord of a live infant in which:
The birth occurred in a hospital;
The infant weighed 2500g at birth for single gestation or 2000g for multiple gestation at birth;
There was oxygen deprivation or mechanical injury;
The injury occurring during labor, delivery or resuscitation efforts in the immediate post delivery
period;
The infant experienced permanent and substantial mental and physical impairment;
The injury was not caused by genetic or congenital abnormality; and
The physician is participating in the Plan.221
A participating physician under the Plan is a licensed Florida physician who either practices obstetrics
or performs obstetrical services on a full or part-time basis and pays a yearly NICA assessment. 222 If
the physician did not pay his or her assessment for the year in which the injury occurred, there is no
NICA coverage. Hospitals that allow doctors who do not participate in NICA to deliver babies are
subject to multi-million dollar catastrophic injury lawsuits despite having paid into the NICA fund.223
Benefits
Once an ALJ determines a child is eligible under the Plan, the child is covered for life, and no other
compensation from a medical malpractice lawsuit or settlement is available.224 Instead, there are
lifetime benefits and care available through the Plan, which include actual expenses for:
Medical and hospital services;
Rehabilitation, therapy, and training;
Family residential or custodial care;
Professional residential and custodial care;
216 Id.
217 Id.
218 Id.
219 S. 766.302, F.S. The Division of Administrative Hearings is housed within the Florida Department of Management Services.
220 S. 766.304, F.S.
221 S. 766.302(2), F.S.
222 S. 766.314, F.S.
223 S. 766.302(7), F.S.
224 Id.
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Medications;
Special equipment and facilities; and
Related travel expenses.225
The Plan may also provide:
A one-time cash award, not to exceed $250,000, to the infant's parents or guardians.
A $50,000 death benefit for the infant.226
Compensation for reasonable expenses incurred for filing the claim, including attorney's fees.
An annual benefit up to $10,000 for psychotherapeutic services for immediate family members
residing with the birth-injured child;
A reliable method of transportation to Plan beneficiaries;
Replacement of any vans purchased by the Plan every 7 years or 150,000 miles, whichever
comes first; and
Housing assistance of up to $100,000 for the lifetime of the child, including home construction
and modification costs.227
Exclusions
The Plan does not reimburse or pay expenses that might otherwise be covered by insurance or any
private or governmental programs, unless such exclusion is prohibited by federal law. 228 Many children
with birth-related injuries are either covered by programs such as Children’s Medical Services or
Medicaid. Under current state and federal law, Medicaid is the payor of last resort for medically
necessary goods and services furnished to Medicaid recipients; therefore, current law appears to
prohibit NICA from shifting covered costs onto Medicaid.229
Effect of the Bill
The bill requires that by September 1, 2025, NICA submit a report to several governmental bodies,
including the Governor, the CFO, the President of the Senate, and the Speaker of the House of
Representatives. This report must include:
Recommendations for defining actuarial soundness for the association, including potential
options for phasing it in if deemed appropriate.
Recommendations for the timing of reporting actuarial soundness and specifying to whom
the soundness should be reported.
Recommendations for ensuring a revenue level that will maintain actuarial soundness, also
providing potential options for phasing it in if deemed appropriate.
The bill clarifies "family residential or custodial care" as care provided by family members beyond
typical duties, without compensation for tasks deemed part of normal family responsibilities. However,
the bill removes the provision stating that the award for family residential or custodial care should not
be included in current estimates for the purposes of another section.
The bill requires that if the total estimates exceed 100 percent of available funds within 12 months,
NICA can't accept new claims without legislative approval, except for claims from injuries occurring 18
months prior. Additionally, the bill mandates that NICA must notify the Governor, the CFO, the
President of the Senate, the Speaker of the House of Representatives, OIR, and AHCA within 30 days
after the effective date of this suspension.
B. SECTION DIRECTORY:
225 S. 766.31, F.S.
226 S. 766.31(1)(b)2., F.S. In 2003, the $10,000 death benefit for an infant replaced the requirements to pay funeral expenses up to
$1,500. (Ch. 2003-416, s. 78, Laws of Fla.)
227 S. 766.31(1)(c), F.S.
228 S. 766.31(1)(a), F.S.
229 S. 409.910, F.S.; 42 C.F.R. s. 433.136; 42 U.S.C. s. 1396a.
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Section 1. Creates s. 17.69, F.S., relating to Federal Tax Liaison.
Section 2. Amends s. 20.121, F.S. relating to Department of Financial Services.
Section 3. Amends s. 121.0515, F.S., relating to Special Risk Class.
Section 4. Amends s. 280. 051, F.S., relating to suspension or disqualification of a qualified public
depository.
Section 5. Amends s. 280.054, F.S., relating to Administrative penalty in lieu of suspension or
disqualification.
Section 6. Amends s. 284.44, F.S., relating to salary indemnification costs of state agencies.
Section 7. Amends s 440.13, F.S., relating to medical services and supplies; penalty for violations;
limitations.
Section 8. Amends s. 440.385, F.S., relating to Florida Self-Insurers Guaranty Association
Incorporated.
Section 9. Amends s. 497.101, F.S., relating to Board of Funeral, Cemetery, And Consumer Services;
Membership; appointment; terms.
Section 10. Amends s. 497.153, F.S., relating to disciplinary procedures and penalties.
Section 11. Amends s. 497.155, F.S., relating to disciplinary citations and minor violations.
Section 12. Amends s. 497.172, F.S., relating to public record exemptions; public meetings
exemptions.
Section 13. Amends s. 497.386, F.S., relating to storage, preservation, and transportation of human
remains.
Section 14. Creates s. 497.469, F.S., relating to fulfillment of preneed contracts.
Section 15. Amends s. 624.307, F.S., relating to general powers; duties.
Section 16. Amends s. 626.171, F.S., relating to Application for license as an agent, customer
representative, adjuster, service representative, or reinsurance intermediary.
Section 17. Amends s. 626.221, F.S., relating to examination requirement; exemptions.
Section 18. Amends s. 626.601, F.S., relating to improper conduct; fingerprinting.
Section 19. Amends s. 626.7351, F.S., relating to Qualifications for customer representative's license.
Section 20. Amends s. 626.878, F.S., relating to rules; code of ethics.
Section 21. Amends s. 626.929, F.S., relating to origination, acceptance, placement, of surplus lines
business.
Section 22. Amends s. 627.351, F.S., relating to insurance risk appointment plans.
Section 23. Amends s. 631.59, F.S., relating to duties and powers of department and office;
association contracts and purchases.
Section 24. Amends s. 631.722, F.S., relating to powers and duties of department and office;
contracts and purchases.
Section 25. Amends s. 631.821, F.S., relating to powers and duties of department; board contracts
and purchases.
Section 26. Amends s. 631.921, F.S., relating to department powers; board contracts and purchases.
Section 27. Amends s. 633.124, F.S., relating to penalty for violation of law, rule, or order to cease
and desist or for failure to comply with corrective order.
Section 28. Amends s. 633.202, F.S., relating to Florida Fire Prevention Code.
Section 29. Amends s. 633.206, F.S., relating to uniform firesafety standards.
Section 30. Amends s. 634.041, F.S., relating to qualifications for license.
Section 31. Amends s. 634.081, F.S., relating to suspension or revocation of license; grounds.
Section 32. Amends s. 634.3077, F.S., relating to financial requirements.
Section 33. Amends s. 634.317, F.S., relating to license and appointment required.
Section 34. Amends s. 648.25, F.S., relating to definitions.
Section 35. Amends s. 648.26, F.S., relating to Department of Financial Services; administration.
Section 36. Amends s. 648.30, F.S., relating to licensure and appointment required; prohibited acts;
penalties.
Section 37. Amends s. 648.355, F.S., relating to limited surety agents and professional bail bond
agents; qualifications.
Section 38. Creates s. 655.49, F.S., bad faith termination or restriction of account access;
investigations by the office.
Section 39. Amends s. 717.101, F.S., relating to definitions.
Section 40. Amends s. 717.102, F.S., relating to property presumed unclaimed; general rule.
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Section 41. Amends s. 717.106, F.S., relating to bank deposits and funds in financial organizations.
Section 42. Creates s. 717.1065, F.S., relating to virtual currency.
Section 43. Amends s. 717.1101, F.S., relating to unclaimed equity and debt of business associations.
Section 44. Amends s. 717.112, F.S., relating to property held by agents and fiduciaries.
Section 45. Amends s. 717. 1125, F.S., property held by fiduciaries under trust instruments
Section 46. Amends s. 717.117, F.S., relating to report of unclaimed property.
Section 47. Amends s. 717.119, F.S., relating to payment or delivery of unclaimed property.
Section 48. Amends s. 717.1201, F.S., relating to custody by state; holder relieved from liability;
reimbursement of holder paying claim; reclaiming for owner; defense of holder; payment of
safe-deposit box or repository charges.
Section 49. Amends s. 717.1242, F.S., relating to restatement of jurisdiction of the circuit court sitting
in probate and the department.
Section 50. Amends s. 717.1243, F.S., relating to small estate accounts.
Section 51. Amends s. 717.129, F.S., relating to periods of limitations.
Section 52. Amends s. 717.1301, F.S., relating to investigations; examinations; subpoenas.
Section 53. Amends s. 717.1311, F.S., relating to retention of records.
Section 54. Amends s. 717.1322, F.S., relating to administrative and civil enforcement.
Section 55. Amends s. 717.133, F.S., relating to evidence; estimations; audit reports, examiners
worksheets, investigative reports, other related documents.
Section 56. Amends s. 717.134, F.S., relating to penalties and interest.
Section 57. Amends s. 717.135, F.S., relating to recovery agreements and purchase agreements for
claims filed by a claimant's representative; fees and costs, or total net gain.
Section 58. Amends s. 717.1400, F.S., relating to registration.
Section 59. Amends s. 766.302, F.S., relating to definitions; ss. 766.301-766.316.
Section 60. Amends s. 766.314, F.S., assessments; plans of operation.
Section 61. Amends s. 197. 582, F.S., disbursement of proceeds of sale.
Section 62. Amends s. 717.1382, F.S., relating to United States savings bond; unclaimed property;
escheatment; procedure.
Section 63. Directs the Division of Law Revision to replace “Division of Investigative and Forensic
Services” with “Division of Criminal Investigations” within Florida Statutes.
Section 64. Creates an undefined section of law providing reporting requirements for the Florida Birth-
Related Neurological Injury Compensation Association.
Section 65. Provides an effective date of upon becoming law.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
DFS may face a minimal fiscal impact due to the change in lowering the required aggregate
reporting threshold from $50 to $10 for Unclaimed Property. While this adjustment could lead to
more people claiming "less than $50" accounts, the overall impact on expenditures is expected to
be small. Additionally, DFS anticipates saving money on the cost of serving administrative
complaints and citations upon funeral licensees.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
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DATE. 2/21/2024
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
The fiscal impact on the private sector, particularly reporting entities, is expected to be positive. The
changes in the bill involve deviations to the ways apparent owners of unclaimed equity and debt
property indicate that they have not lost track of their property.
These updates are designed to enhance the process for determining when equity and debt property is
considered unclaimed. Reporting entities are already accustomed to providing owner information to
other states with similar regulations, and the impact on holders is anticipated to be minimal. While there
may be an initial minor IT cost for formatting changes, the overall fiscal impact on the private sector is
expected to be positive, fostering increased awareness and opportunities for citizens to recover
unclaimed funds.
D. FISCAL COMMENTS:
None.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not Applicable. The bill does not appear to affect county or municipal governments.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
The bill provides rulemaking authority to the Division of Consumer Services to clarify the process for an
insurance company, agency, or agent to submit and update their designated contact for receiving and
responding to consumer complaints.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES
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DATE. 2/21/2024
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