19-8.028: Reimbursement Premium Formula
PURPOSE AND EFFECT: This rule is promulgated to implement Section 215.555, Florida Statutes, regarding the Florida Hurricane Catastrophe Fund, for the 2008-2009 contract year.
SUMMARY: The Board has prepared a statement and found the cost to be minimal. Any person who wishes to provide information regarding the statement of estimated regulatory costs, or to provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.
Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SPECIFIC AUTHORITY: 215.555(3) FS.
LAW IMPLEMENTED: 215.555(2), (3), (4), (5), (6), (7) FS.
IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN FAW.
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Jack E. Nicholson, Senior FHCF Officer of the Florida Hurricane Catastrophe Fund, State Board of Administration, P. O. Box 13300, Tallahassee, FL 32317-3300; telephone (850)413-1340
THE FULL TEXT OF THE PROPOSED RULE IS:
19-8.028 Reimbursement Premium Formula.
(1) through (2)(c) No change.
(d) Contract Year means the time period which begins at 12:00:01 Eastern Time on June 1 of each calendar year and ends at 12:00 p.m. midnight on May 31 of the following calendar year.
(e) through (l) No change.
(3) The Premium Formula.
(a) Because of the diversity of the insurers and the risks they insure which are affected by Section 215.555, F.S., the Premium Formula is adopted in this subsection and special circumstances are addressed in subsection (4), below. The Formula for determining the Actuarially Indicated Premium to be paid to the Fund, as required by Section 215.555(5)(b), F.S., is the rate times the exposure per $1,000 of insured value and this equals the Premium to be paid in dollars. The rates adopted below were determined by taking into account four factors: geographic location by zip code; construction type; policy deductible; and type of insurance and other such factors deemed by the Board to be appropriate. The Formula is developed by an Independent Consultant selected by the Board, as required by Section 215.555(5)(b), F.S.
(b) For the 1999-2000 Contract Year, the Formula developed by the Board’s Independent Consultant, “Florida Hurricane Catastrophe Fund: 1999 Ratemaking Formula Report to the Florida State Board of Administration, March 5, 1999,” which is supplemented by the “Florida Hurricane Catastrophe Fund Addendum to the March 5, 1999 Ratemaking Report, May 26, 1999,” both of which are hereby adopted and incorporated by reference. The basic premium rates developed in accordance with the Premium Formula methodology approved by the Board on May 11, 1999, are hereby adopted and incorporated by reference in Form FHCF-Rates1999, “Florida Hurricane Catastrophe Fund/1999-2000 Rates,” rev. 08/99.
(c) For the 2000-2001 Contract Year, the Formula developed by the Board’s Independent Consultant, “Florida Hurricane Catastrophe Fund: 2000 Ratemaking Formula Report to the Florida State Board of Administration, March 2, 2000,” and the addendum thereto, “Florida Hurricane Catastrophe Fund: Addendum to the March 2, 2000 Ratemaking Report, April 6, 2000,” are hereby adopted and incorporated by reference. The basic premium rates developed in accordance with the Premium Formula methodology approved by the Board on April 25, 2000, are hereby adopted and incorporated by reference in Form FHCF-Rates 2000, “Florida Hurricane Catastrophe Fund/2000-2001 Rates,” rev. 05/00.
(d) For the 2001-2002 Contract Year, the Formula developed by the Board’s Independent Consultant, “Florida Hurricane Catastrophe Fund: 2001 Ratemaking Formula Report to the Florida State Board of Administration, March 15, 2001, as revised May 4, 2001” and the “Addendum to the March 15, 2001 Ratemaking Report,” are hereby adopted and incorporated by reference. The basic premium rates developed in accordance with the Premium Formula methodology approved by the Board on May 30, 2001, are hereby adopted and incorporated by reference in Form FHCF-Rates 2001, “Florida Hurricane Catastrophe Fund/2001-2002 Rates,” rev. 05/01.
(e) through (j) No change.
(k) For the 2008-2009 Contract Year, the Formula developed by the Board’s Independent Consultant, “Florida Hurricane Catastrophe Fund: 2008 Ratemaking Formula Report to the State Board of Administration of Florida, March 26, 2008” is hereby adopted and incorporated by reference. The basic premium rates developed in accordance with the Premium Formula methodology approved by the Board on April 15, 2008, are hereby adopted and incorporated by reference in Form FHCF-Rates 2008, “Florida Hurricane Catastrophe Fund Proposed 2008 Rates, March 26, 2008.” These incorporated documents may be obtained directly from the SBA website, www.sbafla.com/fhcf or by contacting the SBA by mail, P. O. Box 13300, Tallahassee, FL 32317-3300, with a request for the documents.
(4) through (5) No change.
Specific Authority 215.555(3) FS. Law Implemented 215.555(2), (3), (4), (5), (6), (7) FS. History–New 9-20-99, Amended 7-3-00, 9-17-01, 7-17-02, 7-2-03, 7-29-04, 7-17-05, 7-6-06, 7-17-07,________.