PCS for HB 643 (2025): An act relating to residual market insurers
Summary
PCS for HB 643 2025 is a bill to be entitled an act relating to residual market insurers. The title digest covers sufficient evidence to demonstrate an insurance claim for purposes of a bad faith action, removal of the definition of "diligent effort" from the Surplus Lines Law, and removal of the diligent effort requirements for coverage to be eligible for export. It also amends dispute resolution procedures under Citizens Property Insurance Corporation. In that part, the corporation may not seek, and the office may not approve, a maximum hourly rate for attorney fees, and Section 4 provides that the act takes effect July 1, 2025.
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“PCS for HB 643 (2025): An act relating to residual market insurers.”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2025-3289-insurance-banking-subcommittee-proposed-committee-bills-pcbs-1a883ac38c/
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for HB 643 2025
1 A bill to be entitled
2 An act relating to residual market insurers; amending
3 s. 624.155, F.S.; sufficient evidence to demonstrate
4 an insurance claim for purposes of a bad faith action;
5 clarifying the requirement of sufficient evidence;
6 amending s. 626.914, F.S.; removing the definition of
7 the term "diligent effort"; amending s. 626.916, F.S.;
8 removing the diligent effort and other requirements
9 for insurance coverage to be eligible for export;
10 providing presumption of being informed and of knowing
11 of certain insurance coverage under specified
12 circumstances; amending s. 627.351, F.S.; dispute
13 resolution procedures under Citizens Property
14 Insurance Corporation; providing an effective date.
15
16 Be It Enacted by the Legislature of the State of Florida:
17
18 Section 1. Subsection (4) of section 626.914, Florida
19 Statutes, is amended to read:
20 626.914 Definitions.—As used in this Surplus Lines Law,
21 the term:
22 (4) "Diligent effort" means seeking coverage from and
23 having been rejected by at least three authorized insurers
24 currently writing this type of coverage and documenting these
25 rejections. However, if the residential structure has a dwelling
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PCS for HB 643.docx
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for HB 643 2025
26 replacement cost of $700,000 or more, the term means seeking
27 coverage from and having been rejected by at least one
28 authorized insurer currently writing this type of coverage and
29 documenting this rejection.
30 Section 2. Section 626.916, Florida Statutes, is amended
31 to read:
32 626.916 Eligibility for export.—
33 (1) No insurance coverage shall be eligible for export
34 unless it meets all of the following conditions:
35 (a) The coverage must be of a kind or class not generally
36 available from authorized insurers transacting insurance in this
37 state. The full amount of insurance required must not be
38 procurable, after a diligent effort has been made by the
39 producing agent to do so, from among the insurers authorized to
40 transact and actually writing that kind and class of insurance
41 in this state, and the amount of insurance exported shall be
42 only the excess over the amount so procurable from authorized
43 insurers. Surplus lines agents must obtain a statement verify
44 that a diligent effort has been made by requiring a properly
45 documented statement of diligent effort from the retail or
46 producing agent that the coverage is not available from
47 authorized insurers. However, to be in compliance with the
48 diligent effort requirement, the surplus lines agent's reliance
49 must be reasonable under the particular circumstances
50 surrounding the export of that particular risk. Reasonableness
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for HB 643 2025
51 shall be assessed by taking into account factors which include,
52 but are not limited to, a regularly conducted program of
53 verification of the information provided by the retail or
54 producing agent. Declinations must be documented on a risk-by-
55 risk basis. If it is not possible to obtain the full amount of
56 insurance required by layering the risk, it is permissible to
57 export the full amount.
58 (b) The premium rate at which the coverage is exported
59 shall not be lower than that rate applicable, if any, in actual
60 and current use by a majority of the authorized insurers for the
61 same coverage on a similar risk.
62 (c) The policy or contract form under which the insurance
63 is exported shall not be more favorable to the insured as to the
64 coverage or rate than under similar contracts on file and in
65 actual current use in this state by the majority of authorized
66 insurers actually writing similar coverages on similar risks;
67 except that a coverage may be exported under a unique form of
68 policy designed for use with respect to a particular subject of
69 insurance if a copy of such form is filed with the office by the
70 surplus lines agent desiring to use the same and is subject to
71 the disapproval of the office within 10 days of filing such form
72 exclusive of Saturdays, Sundays, and legal holidays if it finds
73 that the use of such special form is not reasonably necessary
74 for the principal purposes of the coverage or that its use would
75 be contrary to the purposes of this Surplus Lines Law with
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for HB 643 2025
76 respect to the reasonable protection of authorized insurers from
77 unwarranted competition by unauthorized insurers.
78 (d) Except as to extended coverage in connection with fire
79 insurance policies and except as to windstorm insurance, the
80 policy or contract under which the insurance is exported shall
81 not provide for deductible amounts, in determining the existence
82 or extent of the insurer's liability, other than those available
83 under similar policies or contracts in actual and current use by
84 one or more authorized insurers.
85 (e) The insured has signed or otherwise provided
86 documented acknowledgment of a disclosure in substantially the
87 following form: "You are agreeing to place coverage in the
88 surplus lines market. Coverage may be available in the admitted
89 market. Persons insured by surplus lines carriers are not
90 protected under the Florida Insurance Guaranty Act with respect
91 to any right of recovery for the obligation of an insolvent
92 unlicensed insurer." If the acknowledgment of the disclosure is
93 signed by the insured, the insured is presumed to have been
94 informed and to know that other coverage may be available.
95 Section 3. Paragraph (ll) of subsection (6) of section
96 627.351, Florida Statutes, is amended to read:
97 627.351 Insurance risk apportionment plans.—
98 (6) CITIZENS PROPERTY INSURANCE CORPORATION.—
99 (ll)1. In addition to any other method of alternative
100 dispute resolution authorized by state law, the corporation may
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PCS for HB 643 2025
101 adopt policy forms that provide an option for the insured to
102 select, at the time of entering into the policy or upon renewal,
103 to have disputes regarding the corporation’s claim
104 determinations for the resolution of disputes regarding its
105 claim determinations, including disputes regarding coverage for,
106 or the scope and value of, a claim, resolved in a proceeding
107 before the Division of Administrative Hearings. Each insured
108 must be notified in writing, at the time of entering into a
109 policy with the corporation and upon each renewal, that they
110 must decide whether to resolve disputes through arbitration
111 before the Division of Administrative Hearings. Such
112 notification must be included, in boldfaced 12-point type
113 immediately preceding the insured’s signature, in the following
114 statement:
115
116 “AN INSURED MUST CHOOSE AT THE TIME OF ENTERING INTO THIS
117 POLICY OR UPON RENEWAL WHETHER TO RESOLVE DISPUTES THROUGH
118 ARBITRATION BEFORE THE DIVISION OF ADMINISTRATIVE HEARINGS.
119 THE INSURED MUST INDICATE THIS SELECTION BY MARKING
120 ‘ACCEPT’ OR ‘DECLINE’ BELOW. THIS DECISION CANNOT BE
121 CHANGED DURING THE TERM OF THE POLICY.”
122
123 Any such policies are not subject to s. 627.70154. All
124 proceedings in the Division of Administrative Hearings pursuant
125 to such policies are subject to ss. 57.105 and 768.79 as if
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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126 filed in the courts of this state and are not considered chapter
127 120 administrative proceedings. Rule 1.442, Florida Rules of
128 Civil Procedure, applies to any offer served pursuant to s.
129 768.79, except that, notwithstanding any provision in Rule
130 1.442, Florida Rules of Civil Procedure, to the contrary, an
131 offer shall not be served earlier than 10 days after filing the
132 request for hearing with the Division of Administrative Hearings
133 and shall not be served later than 10 days before the date set
134 for the final hearing. The administrative law judge in such
135 proceedings shall award attorney fees and other relief pursuant
136 to ss. 57.105 and 768.79. The corporation may not seek, and the
137 office may not approve, a maximum hourly rate for attorney fees.
138 2. The corporation may contract with the division to
139 conduct proceedings to resolve disputes regarding its claim
140 determinations as may be provided for in the applicable policies
141 of insurance. This subparagraph expires July 1, 2025.
142 Section 4. This act shall take effect July 1, 2025.
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