Governor Charlie Crist has signed SB 2176, the Commercial Deregulation bill that was a FIC priority for the 2010 Legislative Session.  It exempts lines of commercial insurance such as excess or umbrella, surety and fidelity and errors and omissions policies from the filing and review requirements.

These types of insurance coverages continue to be subject to s. 627.062(1), F.S., which requires that rates must not be excessive, inadequate, or unfairly discriminatory.

The bill requires that an insurer must notify the OIR of any changes for the types of insurance subject to this provision, no later than 30 days after the effective date of the change in rates. The notice to the OIR must include the following information:
  • The name of the insurer;
  • The type of insurance;
  • The total premium written during the immediately preceding year for that type of insurance;
  • The average statewide percentage change in rates.
Underwriting files, premiums, and loss and expense statistics must be maintained by the insurer and are subject to inspection by the OIR.

The bill also amends the section of law relating to rate setting for motor vehicle insurance.  The bill provides that commercial motor vehicle insurance covering a fleet of 20 or more self-propelled vehicles are exempt from the following provisions:
  • Section 627.0651(1), F.S., which establishes the procedures required for automobile insurers to file rates, rating schedules and rating manuals;
  • Section 627.0651(2), F.S., which specifies the factors the OIR must apply to determine whether an automobile insurer’s rates are excessive, inadequate, or unfairly discriminatory;
  • Section 627.0651(2), F.S., which allows the OIR to require information necessary to evaluate the filing;
  • Section 627.0645, F.S., which requires annual rate filings.
The bill provides that rates for insurance under this section may not be excessive, inadequate, or unfairly discriminatory, and must be set to allow the insurer a reasonable rate of return.

The original bill was limited to commercial deregulation but was amended in the final days of session to include important workers’ compensation language as well as Chief Financial Officer Alex Sink’s “Save Our Seniors” suitability language.

FIC is producing separate reports on the language regarding those provisions.