451649, 19-8.010 - Florida Administrative Rules, Law, Code, Register

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Notice: 451649

Notice of Proposed Rule

Department:

STATE BOARD OF ADMINISTRATION

Chapter:

ADMINISTRATION OF THE FLORIDA HURRICANE CATASTROPHE FUND

Overview

RULE:

19-8.010	Reimbursement Contract
19-8.013	Revenue Bonds Issued Pursuant to Section 215.555(6), F.S

PURPOSE:

The State Board of Administration, Florida Hurricane Catastrophe Fund, is proposing to amend the following rules in order to implement changes made by CS/CS/SB 1980 during the 2006 legislative session.

SUMMARY:

Rule 19-8.010, F.A.C.: Proposed amended Rule 19-8.010, F.A.C., adopts the Reimbursement Contract for the Contract Year 2006-2007 in paragraph (12). This paragraph has been amended to reflect that the Reimbursement Contract now includes three addenda. The changes made to the contract are summarized as follows:
Addendum No. 1: The definition of “losses” in Article VI(4) is amended to clarify that losses covered by the FHCF do not include “rent or rental income.” The language in Article X, which quoted language in Section 215.555(4)(d)2., F.S., which was stricken in CS/CS/SB 1980 was removed and the references to the rapid cash build-up in Articles V(16) and Article X were amended to reflect the amendments to Section 215.555(5)(b), F.S., which requires the inclusion of a 25% rapid cash build-up factor in the reimbursement premium formula.
Addendum No. 2: This Addendum, which addresses a new option created in CS/CS/SB 1980 which allows limited apportionment companies to obtain up to $10 million dollars in additional FHCF coverage, must be completed by all limited apportionment companies and allows them to select from $0 up to $10 million in additional coverage. The Addendum also provides information on the cost and payment timeline for such additional coverage and clarifies that other provisions of the Reimbursement Contract, to which the Addendum is attached are applicable to the Addendum.
Addendum No. 3: This Addendum addresses the changes to Section 215.555(5), F.S., which created a procedure by which Citizens Property Insurance Corporation (“Citizens”) could obtain FHCF coverage for policies when Citizens takes over policies from a liquidated insurer. The law allows Citizens to choose whether to include such policies under its Reimbursement Contract with the FHCF or to accept an assignment of the liquidated insurer’s Reimbursement Contract with the FHCF.   Addendum No. 3 provides the information on these new options, provides the form on which to make the option and provides the requirements, procedures and timeframes for selecting the option with respect to each transfer of policies from a liquidated insurer to Citizens.
SUMMARY: Rule 19-8.013, F.A.C.: The proposed amendments to Rule 19-8.013, F.A.C., add clarifications regarding the use of reimbursement premiums and rapid cash build-up from Contract Year 2006-2007 to pay losses, add clarifications to the grounds for adjusting the emergency assessment percentage, and add clarifications to address the emergency assessment payment calculations.

RULEMAKING AUTHORITY:

215.555(3) FS.

LAW:

215.555(2), (3), (4), (5), (6), (7), (10) FS.

PRINT PUBLISH DATE:

6/30/2006 Vol. 32/26

COMMENTS:

From 6/30/2006 To 7/21/2006 (21 Days)
The public comment period for this notice has already expired.

REFERENCE MATERIALS:

No reference(s).

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