The House Takes a Step towards Budget Agreement; Senate Quickly Responds

As we reported in last week’s newsletter, the budget is certainly the big issue in flux at our state Capitol right now.  Both the House and Senate feel confident about their budget proposals and last Thursday (4/23/15) the House sent its official budget offer to the Senate, seemingly an effort to move toward an agreement. Lots of folks were surprised by this unexpected step by the House and the possibility of meeting the May 1 session end date. The House offer includes using $200 million in state monies and another $300 million in federal funding to offset any potential losses to hospitals from a possible federal decision on the LIP program.

On Friday (4/24), the Senate quickly responded to Thursday’s House budget proposal but in the response the upper chambers held fast to its desire for expanding access to quality health care by the uninsured through Medicaid and not retreat from the Low Income Pool Program (LIP). The Senate’s proposal also included earmarking approximately $264 million for public education that would raise per pupil funding to its highest level in Florida history. Although leadership of the two chambers have yet to formalize an agreement, both are signaling a desire to extend the current legislative session to resolve the budget, instead of holding a special session likely in June. We are closely monitoring the Legislature’s budget negotiations and will bring you updates as they occur.

While the budget battle continued, our legislators worked very hard last week to address many bills that needed their attention.  For the LMA Team who follows every step of these bills, we didn’t take a breath.  We monitor and track our bills on a minute, hour, and daily basis so we can give you the most current information in each newsletter publication.  It’s a plate full for us and we absolutely recognize and appreciate what our legislators go through.  These folks are dedicated public servants and we applaud their commitment and endurance.

So, here we go with last week’s bill activities.

Legislative Activity Updates

Property & Casualty Insurance

(AKA Insurance Omnibus Bill)

CS/SB 258 by Sen. Jeff Brandes (R-Pinellas) and                                                                           CS/HB 165 by Rep. David Santiago (R-Volusia)

This past week the Property & Casualty Insurance Omnibus bills saw a lot of action on their respective chamber floors with HB 165 by Rep. David Santiago (R-Volusia) ultimately being approved by both the House and Senate. On Wednesday (4/22) Rep. Santiago’s measure (CS/CS/CS/HB 165) won final approval on the House floor and was quickly transmitted to the Senate via messages. On Thursday (4/23) during its floor session the Senate considered its companion measure, SB 258 by Sen. Jeff Brandes (R-Pinellas), however, Sen. Brandes moved that his bill be laid on the table and that the Senate instead take up the House bill. The Senate approved Sen. Brandes’ motion and then voted to give final legislative approval to CS/CS/CS/HB 165. The bill is now on its way to the Governor for his action. As you may recall, both the House and Senate omnibus bills underwent the amendatory process numerous times in recent weeks. Below is a list of the key components contained within HB 165 that’s on its way to Governor Scott:

> Establishes a uniform 120-day notification period for all property insurance non-renewals, cancellations, or terminations.

> Amends the law regarding pre-insurance inspection requirements for new, unused leased motor vehicles leased from a licensed motor vehicle dealer or leasing company.

> Limits insurance company notification to policyholders regarding the right to participate in neutral evaluation of sinkhole claims to only those policies with sinkhole coverage with claims received within the 2-year statute of limitations.

> Makes clear that the Medicare fee schedule used in personal injury protection insurance runs from March 1 through the last day of February of the following year.

> Enlarges the time insurance companies can use a hurricane model from 60 to 120 days.

> The bill also includes commercial insurance provisions relating to rate certification and annual rate filings.

> Establishes in state law that federally licensed physical therapy and speech pathology clinics are exempt from PIP clinic licensure requirements.

Florida Insurance Guaranty Association

(FIGA) Reform Legislation

CS/SB 836 by Sen. Jack Latvala (R-Pinellas) and                                                                              CS/HB 557 by Rep. Jake Raburn (R-Hillsborough)

LMA is pleased to report that the FIGA bill (SB 836), as it is commonly called, is on its way to the Governor. This bill is a compromise among stakeholders, some who opposed having FIGA finance a deficit like other quasi-governmental entities do (through public financing) and those who supported changing the way FIGA does business. LMA and its strategic partners worked diligently on behalf of the entire Florida based insurance industry so that during catastrophic times, FIGA and the industry could work together to finance FIGA’s deficit as opposed to the present way where insurers simply stroke a check as the “bank” for FIGA. FIGA and OIR representatives were helpful to forge the compromise so that once the bill is implemented, if financially prudent, the insurers will be able to collect and remit FIGA assessments once the assessment amount is determined. And the assessment amount will be calculated using a methodology that is more fair to all consumers, instead of the current system where past market share dictated the amount to be collected. Lastly, no more FIGA rate filings! Under the new law, insurers will do what are called reconciliation reports and the over/under payments will be handled in a much more streamlined process. Hats off to Rep. Jake Raburn, who has been the champion of this bill for the 3rd year and never lost faith that this good public policy should become law. Sen. Jack Latvala was this year’s Senate sponsor and Sen. Tom Lee, last year, was responsible for leading the discussion to forge the compromise. We look forward to the Governor’s signature on the bill.

Transportation Network Companies (TNCs)

SB 1298 by Sen. David Simmons (R-Seminole/Volusia); and,                                                 CS/HB 817 by Rep. Matt Gaetz (R-Walton)

We knew at the beginning of session that the TNC bills would garner a great deal of attention, but didn’t realize how correct we were in our thoughts.  You will recall that the session started with four bills, with only two surviving to this point.  And those two remaining bills, by Sen. Simmons and Rep. Gaetz, have met with formidable resistance during committee meeting and in their respective chambers. Much of the debate has been on how and when the different insurance coverages will respond to a claim; when and at what point in the “ride” is the driver’s insurance or the TNC’s liable, and taxi companies are claiming that the TNC’s should obey local insurance laws.  When asked if there is a compromise between the House and Senate versions of the bills, Rep. Gaetz stated that “…the House and Senate are pretty far apart on ride sharing and that’s unfortunate.”  However, Sen. Simmons said the differences aren’t really significant and that a version of the bills has a good chance to pass.


The minimum insurance coverage in the bills remain the same: $1 million in liability coverage for death, bodily injury and property damage while passengers are in the vehicles; for the “on-call” time, the Senate version requires the driver or company will carry $100,000 for death and bodily injury, and $50,000 for property damage; the House version is $50,000 for death and bodily injury and $25,000 for property damage; the Senate bill requires 24-hour coverage for drivers who have been with a TNC for six months or longer and that the TNC insurance coverage is issued by an admitted insurer; the House version still includes the national agreement we reported on previously and includes the ability to purchase coverage by TNC’s through non-admitted/surplus lines companies.

CS/HB 817 by Rep. Matt Gaetz (R-Walton) which carried a strike-all amendment by Rep. Gaetz and several other amendments was the subject of much discussion and debate when it was heard on the House Floor on Thursday, April 23.  On Friday, 4/24, the bill was temporarily postponed when heard in its 3rd reading.

CS/SB 1298 by Sen. David Simmons (R-Orange), which also carried a strike-all amendment by the sponsor, was heard by the Senate on Thursday, 4/23 and passed with 28 yeas and 12 nays.  The bill now waits to be heard by the House.

The TNC bills have been interesting to watch and we still aren’t ready to bet on what the outcome will be.  We will, however, bet that if these bills die this year, they will most likely return for the 2016 Session.

Citizens Depopulation

SB 1006 by Sen. Anitere Flores (R-Miami/Dade) and HB 1087 by Rep. Michael Bileca (R-Miami/Dade)

SB 1006 by Sen. Anitere Flores(R-Miami/Dade) was placed on the Senate Special Order Calendar for today (4/27).  Sen. Flores promised the Senate Appropriations committee on 4/16, that she would work on a floor amendment to address concerns regarding the takeout “encouragement” letter that Citizens sends to selected policyholders.  We’ll watch for that amendment and any other changes to the bill when it’s heard on the Senate floor this week.

CS/HB 1087 by Rep. Michael Bileca (R-Miami/Dade), as amended last week by the bill sponsor, will require an agent appointed by Citizens to be appointed with an authorized (admitted) insurer actually writing or renewing property insurance in Florida and that insurer must continue writing or renewing such coverage in Florida, otherwise, the agent will no longer be eligible for his/her appointment with Citizens. After being passed on the House floor on 4/16, the bill was sent to the Senate in messages on 4/21.  We will see if this bill and its Senate companion can survive the remaining time in Session and win final legislative approval. We will keep you posted.

Assignment of Benefits (AOB)  

HB 669 by Rep. John Tobia (R-Brevard); Similar bills, SB 1064 by Sen. Dorothy Hukill (R-Volusia); SB 1210 by Sen. Alan Hays (R-Lake County)

Unfortunately, for the past three weeks there has been no forward movement on these mission critical bills and little hope remains this session for legislative action to curb the major abuses occurring through the improper use of AOBs.  LMA and associated stakeholders who have been working diligently throughout session to move this critically needed legislation will continue to fight the good fight and bring these measures forward again next session.  In our post-session report we will make sure to share lessons learned about how we could have all improved our efforts to move this legislation.

Flood Insurance 

SB 1094 by Sen. Jeff Brandes (R-Pinellas); HB 895 by Rep. Larry Ahern (R-Pinellas)

As we did earlier with Rep. Jake Raburn (R-Hillsborough), LMA would also like to tip our hats to Sen. Jeff Brandes (R-Pinellas) for his dedication and heavy lifting in passing further legislation this session to establish a private sector primary flood insurance market in Florida giving property owners a choice over the NFIP. This past Wednesday (4/22) the Senate passed Brandes’ flood insurance measure (SB 1094) and quickly sent the bill to the House via messages. On Thursday (4/23) in floor action, the House laid its companion measure, HB 895 by Rep. Larry Ahern (R-Pinellas), on the table and took up SB 1094 instead. The House approved the bill and placed it on its 3rd Reading Calendar for the following day (Friday, 4/24).

This past Friday in floor action when the House took up SB 1094,  Rep. Kevin Radar (D-Palm Beach) asked a series of questions that seemed to indicate he did not understand the purpose of this bill.  The bill is designed to give flexible options to consumers to decide what they want to spend on a flood insurance policy and designing a policy that best fits their needs. Rep. Radar asked questions about deductibles, coverages, OIR licensing requirements, OIR regulation and a number of other things which made it evident that perhaps Rep. Radar does not philosophically agree with  the concept of a private, primary flood insurance market.  If you want to see the debate, please go to this link to access the Florida Channel’s video archives:

Regardless of the questions raised by Rep. Rader, the full House granted final legislative approval to SB 1094 by a vote of 89-26 and the bill is now on its way to the Governor’s desk for his consideration. We’ll keep you posted on the Governor’s actions concerning the bill.

Sinkhole Activity Damage Improvement/Economic Development

SB 404 by Sen. Wilton Simpson (R-Hernando); Comparable, HB 933 by Rep. Mike La Rosa (R-Osceola/Polk)

You will recall that HB 933 and SB 404 both contained sinkhole language that declared that there is a compelling state interest in enabling property owners to voluntarily finance certain improvements to property damaged by sinkhole activity with local government assistance; added as a qualifying improvement the repair of sinkhole activity damage under Section 163.08, F.S., and expanded the definition of “blighted area” to include a substantial number or percentage of properties damaged by sinkhole activity which are not adequately repaired or stabilized. The sinkhole repair language was moved from these bills to SB 1216 and passed adding to current law that a local community would have the authority to create a Community Redevelopment Agency (CRA) if it meets the statutory criteria in the law for a blighted area. Under SB 1216 the statutory definition of blighted area will now include, “A substantial number or percentage of properties damaged by sinkhole activity which have not been adequately repaired or stabilized.”

This simple change gives validation that the Legislature considers sinkhole problems seriously and gives great weight to finding a solution to funding solutions to fix them, primarily through a CRA function. There is also a $2 million appropriation tied to this but budget talks as you know have stalled so more on that soon. SB 1216 took major strides this past week when on Wednesday (4/22) the bill was given final approval by the full Senate and sent to the House in messages. On Thursday the House took up SB 1216’s companion measure, HB 933 by Rep. Mike La Rosa (R-Osceola/Polk). Rep. La Rosa moved that his bill be laid on the table and that the House take up SB 1216 instead. The House approved the motion and on Friday (4/24) in further floor action, the House gave SB 1216 final legislative approval by a vote of 83-31. The measure now heads to the Governor’s desk for his review and action.

Property Insurance Appraisal Umpires

HB 491 by Rep. Frank Artiles (R-Miami/Dade); Similar Bill:  SB 744 by Sen. Garrett Richter (R-Lee/Collier)

These bills create the property insurance appraisal umpire licensing program including continuing education and disciplinary processes under the auspices of the Department of Business & Professional Regulation. This past Friday (4/24) during floor action the House gave its final approval to HB 491 by a vote of 99-14 and sent the bill to the Senate through messages. The Senate companion, SB 744 by Sen. Garrett Richter (R-Lee/Collier) remains in the Senate Appropriations Committee and has not received that committee’s final approval. Therefore, it is unknown at this time whether the Senate will take up HB 491 and give the measure final legislative approval. If the House bill were to pass this session it will have a significant impact on the appraisal process so we are monitoring this fluid situation extremely closely and will provide updates. Stay tuned!

Insurance Fraud Reform

SB 1306 by Sen. Rob Bradley (R-Alachua/Bradford) and HB 1127 by Rep. Jennifer Sullivan (R-Lake/Orange)

SB 1306 by Sen. Rob Bradley (R-Clay), which was amended earlier in session to remove all additional fraud reporting and SIU changes, deals with PIP fraud only, cleans up language for healthcare clinic unlicensed activity and un-compensable and unlawful charges, sunsets the direct support organization for PIP, and defined last week by Sen. Bradley as “reducing unnecessary government”, made it to the Senate Calendar early last week.  However, by Thursday, 4/23, it was laid on the table and substituted by CS/CS/HB 1127.

CS/CS/HB 1127 by Rep. Jennifer Sullivan (R-Lake) was sent to the Senate in messages and substituted for CS/CS/SB 1306.  The Senate passed CS/CS/HB 1127 with 39 yeas and 0 nays on Friday, 4/24.  We will therefore, assume that a bill moves forward, it will be Rep. Sullivan’s CS/CS/HB 1127.

Workers’ Compensation

SB 1060 by Sen. David Simmons (R-Seminole/Volusia) and HB 1013 by Rep. Bill Hager (R-Palm Beach)

CS/SB 1060 by Sen. David Simmons (R-Seminole/Volusia) and CS/HB 1013 by Rep. Bill Hager (R-Palm Beach) didn’t make a move last week and we will bet that these two bills are dead for this legislative session.  If so, we look for another effort in 2016 to remove the legislative ratification for maximum reimbursement allowances and manuals for workers’ compensation insurance that was the substance of the bills.

Bills on Life Support and Highly Unlikely to Pass

There is little time left in the 2015 Regular Legislative Session and the budget stalemate is receiving the majority of leadership’s attention. We continue to closely monitor for you a small number of important insurance bills that are hanging by a thread. Those bills include the following:

  • Civil Remedies against Insurers: HB 1197 co-sponsored by Rep. Kathleen Passidomo (R-Collier) and Mike Hill (R-Escambia/Santa Rosa); SB 1088 by Sen. Jeff Brandes (R-Pinellas).
  • Quota Share Reinsurance-(Citizens bill): SB 936 by Sen. Jeff Brandes (R-Pinellas); HB 1307 by Rep. Dan Raulerson.
  • Insurer Solvency Reform: SB 1190 by former Senate President Tom Lee (R-Hillsborough) and HB 1085 by Rep. David Santiago (R-Volusia).

We’re There So You Don’t Have to Be

Friday, May 1 is scheduled as the last official day of the 2015 Legislative Session but the Speaker of the House and Senate President are leaning in the direction of extending this Regular Session as opposed to holding a special session early this summer to finally settle on a state budget for next year. As Floridians we have a prideful, independent nature and never want what we do to be influenced by the goings on in Washington. Nonetheless, this time what’s going on in Washington regarding LIP funding is having a direct impact on our legislature’s decisions and negotiations concerning Florida’s budget. Although we don’t like it, we will have to consider the decisions made in the District of Columbia and our legislative leaders will make the best possible decisions for Florida’s budget future. We laud our legislative leaders and their respective budget teams for the heavy lifting and critical thinking they do to keep our large and dynamic state on its prosperous path. We owe them our gratitude and appreciation. As we noted in this newsletter, a number of insurance bills representing well thought out and consumer oriented public policy crossed the finish line this past week and are on their way to the Governor’s desk. These are great successes for a lawmaking process that has no equal elsewhere in the world. And who knows, if the session is extended by leadership it may, just may, provide that little extra amount of time for a few more important bills to cross the finish line! We thank you for all that you are doing to make our state the great place it is to live and conduct business and it’s our pleasure to continue being heavily involved in the legislative process on your behalf.

Until next time,

Lisa and the Team