Election Day Came, Went and Life Moved On

Yes, it did; we lived through it all and are doing just fine.  It was the normal deluge of campaign slogans, yard signs, bill boards, and television, radio and internet messages from our favorite and not-so-favorite candidates.  The concession speeches were given by the losers and the victory parties celebrated for the winners.  We at LMA have worked to stay “in touch” and keep you “in touch” with all the goings-on during this election season and now we are ready to get busy with the business of business.  We’re excited about the upcoming 2015 Legislative Session and are making our plans to be everywhere again.  Just so you know, we will begin the weekly publication of our newsletter on Monday,  March 2, 2015, and in that first weekly release, we’ll release a “Welcome to the 2015 Legislative Session” edition.  The welcome edition will provide you with valuable information on how to “stay in the know” throughout the session.  Some of the topics will be:  How and where to go to set up bill tracking; Important websites for information; How to watch committee meetings live (streaming) on your computers; Important session dates; Timing requirements for making bill and amendment filings, and some other topics to help you stay “in touch” along with us. It’s going to be an awesome 2015 and we look forward to working together alongside you to make it happen. Ill want to be aware of; how to watch committee meetings live (streaming) on your computers; important dates such as first

So Let’s Recap the November 4 Election


We are appreciative of an article provided by a fellow Floridian and consultant, who we have the opportunity to work side-by-side with on a variety of important projects.  He wrote a great recap of the statewide elections and we pulled a few items (with his permission of course) from his article to share with you.

Beginning with the governor’s race, Rick Scott was declared the victor by the Associated Press shortly after 10:00 pm on 11/4 with just a few precincts remaining outstanding while Fox News would wait until midnight before making their call. While provisional ballots were still to be counted, by 11:30 pm Governor Scott had received over 2.8 million votes and was leading Charlie Crist by just under 80,000 votes.  In our Florida cabinet, all three cabinet officers were re-elected; Attorney General Pam Bondi, Agriculture Commissioner Adam Putnam and Chief Financial Officer Jeff Atwater.  In the Senate, the surprise of the evening was the race in Senate District 34 between incumbent Maria Sachs and challenger, Ellyn Bogdanoff.  This was a rematch of two years ago between these same two candidates for the district redrawn following the 2010 census. With Sachs’ win the Senate will retain its Republican majority.  Of course, with Senator Thrasher’s new position as FSU President and his resignation from the Florida Senate effective November 16, a special election will be held to fill this seat. House Republicans Ronald “Doc” Renuart and Travis Hutson are expected to run for this seat. In the House, Republicans gained a majority, holding 81 out of 120 seats in the House by taking six Democrat-held seats mostly along the I-4 corridor.  A special election will be held in for House District 13 due to errors in qualifying paperwork made by Democrat incumbent Reggie Fullwood.


Like Florida, it appears Republicans will control both the Senate (52 seats) and the House (243, with 15 seats undecided), as members of the GOP won the majority of seats in both chambers (first time in eight years).  The pressure will be on during the Lame Duck Session that began last Wednesday, November 12 and lasts for one month, ending the day the current continuing resolution expires.  Issues such as government spending, tax extenders, terrorism risk insurance (TRIA) are on the table to be addressed during this period.  Depending on whether Republicans decide to address issues before they become the majority or not, will have an effect on decisions made on these important issues. If you are interested in details on a specific state’s election results, give us a call and we’ll give you the scoop.

So, with lots of very, very tight races here in Florida and around the country, it does look like Republican majorities abound.  We like to follow the politics, however, we know that you, like us, only want the best for the citizens of our great country and state, regardless of which party is doing what.  We will continue the work ahead and the challenges of each day!

OIR Issues Final Order Approving Workers’ Compensation Rates

The Florida Office of Insurance Regulation (OIR) approved an overall decrease of 5.2% in workers’ compensation insurance rates in Florida, the first decrease in four years. The NCCI’s original filing in August proposed a 2.5 percent rate decrease, which they amended in September to 3.3 percent.  The amended rate reflected the adoption of a revised Rule relating to the reimbursement manual for hospitals by the Florida Division of Workers’ Compensation. An October rate hearing followed and OIR issued an Order to NCCI disapproving their proposed 3.3 percent overall decrease in Florida. The OIR contended that the NCCI’s use of an increase in the profit and contingency factor from 2.5 percent to 4.5 percent was excessive and unjustified. Insurance Commissioner Kevin McCarty stated, “Just last year, NCCI requested and was approved for a 2.5 percent profit and contingency provision and the record does not reflect any significant change in the economy in the past year that would justify a near doubling of the underwriting profit. Florida’s Workers’ Compensation market is functioning very well, taking into account current economic conditions, and we want to ensure it remains doing so.” However, the Order of Disapproval did allow the NCCI an opportunity to amend and re-file responding to OIR’s requested changes which were:

  • An overall statewide rate level decrease of 5.2 percent, including a 2 percent decrease in annual trend for indemnity costs and a 0.5 percent increase in annual trend for medical costs.
  • A profit and contingency factor increase of no more than 2.5 percent.
  • A production expense provision no greater than 17.40 percent also applicable to “F” classifications.
  • A requirement that the NCCI list and explain each change in its proposed rating manual pages, including the experience rating plan manual and the retrospective rating plan manual
  • A requirement that the NCCI provide a report for each quarter of 2015 showing the average intrastate experience modification factor for policies with effective dates in 2015 and for the same policies with effective dates for a comparable period in 2014
  • A provision for a monthly NCCI report to the OIR of the average intrastate experience modification factor for policies effective during the month.

The NCCI submitted an amended rate filing on November 12 and Commissioner McCarty signed the final order of approval on the same day, making the new rates effective January 1, 2015 for both new and renewal policies. OIR’s final order can be viewed HERE.

200 Former NFL Players Opt Out of Brain Injury Settlement

Since we are at the height of football season, LMA thought it timely to share an article and update readers on the status of former NFL players’ concussion lawsuit against the league. As many of you are aware, over 5,000 former football players have sued the NFL pursuing damages for head injuries. In their suit, the retirees accused the NFL of negligence and failing to inform players of the link between repeated traumatic head impacts and long-term brain injuries. Recently, more than 200 former players opted out of a proposed settlement to resolve National Football League concussion claims. In its settlement proposal, the NFL has committed to pay at least $765 million to resolve claims the league hid known concussion risks for years. Current players are not included in the pending litigation. Retired players who opted out of the proposed class-action settlement have the option of suing the NFL individually, but they likely would have to show their brain injuries directly resulted from concussions suffered while they were playing in the NFL. You may read the full story at the following LINK.

McCarty and Cigna Reach Agreement on HIV/AIDS Medications

Friday 11/7/14- In an official ORDER Cigna Health and Life Insurance Company and Insurance Commissioner Kevin McCarty have agreed to actions to ensure Florida residents living with HIV/AIDS have access to medications they need as provided through Chapter 627.429, Florida Statutes. The Office of Insurance Regulation (Office) was recently made aware of allegations that some health insurers may have been violating this statute by placing all HIV/AIDS medications in the highest tier of their drug formulary, requiring prior authorizations to fill prescriptions, and implementing unnecessary and discriminatory step protocols. “I appreciate Cigna taking proactive steps to address these allegations,” McCarty said. “I am committed to making sure insurers are not acting in a manner that is discriminatory and inconsistent with Florida law and today’s announcement shows Cigna is committed to those principles as well.”

Reminder: PIP Reform Data Call Responses Due in Three Weeks

As many of our readers will recall, on October 31 the Office of Insurance Regulation (OIR or Office) announced an official data call requesting certain information from the top 25 personal auto writers in Florida. In its data call the Office said it will use the information to help evaluate the impact of the reforms made in House Bill 119 passed during the 2012 Regular Legislative Session. HB 119 was designed to lower premiums and combat fraud in Florida’s personal injury protection (PIP) system. Although OIR’s request requires responses from the top 25 personal auto writers in Florida, the data call template could be provided by any personal auto writer that would like to participate. All responders (required or voluntary) should complete the data call template (excel file) and submit, via email to [email protected], no later than 5 p.m. EST on December 5, 2014. Please contact us if you have any questions about this data call as we’ll be happy to assist.

“How Does an Insurer Launch a New and Innovative Product in Florida?”

LMA was fully staffed on October 30 to attend the Florida Office of Insurance Regulation 2014 Industry Conference. We know lots of those folks since our LMA team consists of three former regulators and it was good to not only listen and learn, but to have the opportunity to chat privately about some of the important topics of interest to you.  For example, during the breakout session for Rates & Form Filing Statistics/Legislative Changes, our team asked a question that many of you have posed: “How does an insurer launch new and innovative products when most OIR guidelines/requirements indicate they must provide  “experience” data to support the actuarial and forms analysis”. Sandra Starnes, Director of P&C Product Review, shared with the audience that OIR has “strongly considered this issue” and in order to not stymie innovation, she offered to provide OIR’s written guidance for new and innovative products. Sandra also told the audience that she is more than happy to discuss product offerings and in fact recommended that insurers come and visit with her office prior to submitting the filings.

Senator David Simmons to Serve as New Rules Committee Chair

Monday 11/10/14- Senate President-Designate Andy Gardiner (R-Orange) has appointed Sen. David Simmons (R-Seminole/Volusia) to the influential position of Chairperson of the Senate Committee on Rules. “David is a loyal advisor, a trusted confidante and good friend,” said President-Designate Gardiner. “With over three decades of experience practicing law and ten years of service in the state legislature, he is well-qualified to assume this critical leadership position. Throughout his years of public service, David has exhibited sound judgment and a fair-minded, reasonable and thoughtful approach to decision making that, I am confident, will be a great benefit to the Senate over the next two years.” Sen. Simmons served in the Florida House of Representatives from 2000-2008 and was elected to the Senate in 2010 and re-elected subsequently. He earned his law degree at Vanderbilt University and has practiced law in Florida for more than 30 years. The Rules Committee Chair position was previously held by former Sen. John Thrasher who was recently confirmed by the Senate as the new President of the Florida State University.

President-Designate Gardner Taps Sen. Bill Galvano as Majority Leader

Wednesday 11/5/14- Sen. Bill Galvano (R-Bradenton) has been selected by Senate President-Designate Andy Gardner (R-Orlando) to serve as Senate Majority Leader for the 2014-2016 legislative term. “Over years of serving together in the House, and now the Senate, I have witnessed Bill’s strong work ethic, innate intellect and willingness to tackle tough issues,” said President-Designate Gardiner. “I know Bill will fight tirelessly to further the success of the Senate’s priorities, as well as those of our Republican Caucus and Republican Senators,” continued President-Designate Gardiner. “Together with our Democrat Leader, Sen. Joyner, Bill will work to ensure a smooth operation on the Senate floor where all Senators will have the opportunity to have their voices heard.” Sen. Galvano served in the Florida House from 2002-2010 and was elected to the Senate in 2012. Sen. Galvano earned an associate’s degree from Manatee Community College, a bachelor’s degree from the University of Florida and a Juris Doctorate from the University of Miami.

DFS Announces Arrests in Southeast Florida Organized PIP Fraud Scheme

Thursday 10/30/14- In a press release the Department of Financial Services (DFS) announced the arrests of attorneys, chiropractors and clinic employees involved in an organized personal injury protection (PIP) fraud scheme. The arrests in Martin, Miami-Dade and Palm Beach counties follow a year-long undercover investigation by detectives with DFS’s Division of Insurance Fraud. The Department’s release refers to the arrests as the culmination of more than a year of extensive and often dangerous undercover work that exposed an alleged crime ring responsible for potentially hundreds of thousands of dollars in fraud. During the investigation, multiple undercover detectives were embedded into clinics that were accepting patients who were supposedly illegally solicited. The investigation alleges that one clinic in particular was billing for services that were never rendered. On several occasions, patients were also found being coached to claim they were injured when they were not. As the investigation progressed, an undercover detective became a patient broker for the ring. The targets indicated they would compensate the undercover detective for referring patients under the guise of marketing. During the meeting in which the brokering agreement was discussed, the principal targets all agreed to pay the undercover detective for bringing patients to specific clinics. Several times during meetings, the principal targets mentioned that it was illegal to directly pay for patients and that is why they disguise it as marketing.

The individuals arrested include:

* Roger Hughes Bell (chiropractor), Hobe Sound

* Brian Greenspoon (attorney), Boca Raton

* Alejandro Marin, Homestead

* Cory Meltzer (attorney), Boca Raton

* Douglas Santiago, Boynton Beach

At the time of the above arrests, DFS also had in hand two additional arrest warrants, one for a woman residing in Stuart and a Lake Worth man licensed as a chiropractor.  The defendants in this case will be prosecuted by the 15th and 19th Judicial Circuit State Attorney’s offices. LMA congratulates and acknowledges the fine work of the Division of Insurance Fraud team members involved in making this case. Working together in the trenches the Fraud Division and insurance industry are making advances in combating PIP fraud, the single largest cost driver in our state’s no-fault auto insurance system.

Florida Supreme Court Rules in Motor Vehicle Case

On October 23, the Florida Supreme Court (FSC) held that a “non-stacking” uninsured motorist (“UM”) coverage election form signed by the named insured applied to all insureds under the policy. This case before the FSC stemmed from an automobile accident where Crystal Harrington was injured in a single car accident while riding as a passenger in a car owned by her father, but driven-with permission-by a non-family member, Joey Williams. The father’s car was insured by Travelers and Harrington’s mother was the named insured and purchaser of the policy.  The liability limits on the policy were $100,000/$300,000, along with non-stacked UM coverage at the same limits. Williams had his own policy with Nationwide, but he was also covered under the Travelers policy since the definition of insured included any person lawfully occupying the vehicle. Both Nationwide and Travelers paid Harrington the maximum liability limits but the amounts paid were still short of covering Harrington’s damages, therefore, Harrington filed for UM benefits from Travelers.  Travelers refused to pay under the UM coverage, basing their position upon an application of the family vehicle exclusion.  The exclusion states that an uninsured vehicle does not include:  “Owned by or furnished or available for the regular use of you or a “family member” unless it is a “your covered auto” to which Coverage A of the policy applies and bodily injury liability coverage is excluded for any person other than you or any “family member” for damages sustained in the accident by you or any “family member [.]”  Harrington filed suit and the trial court found for Harrington with the position that the family vehicle exclusion conflicted with Section 627.727(3), F.S. (2009), and that the non-stacking UM election executed by Harrington’s mother (the named insured), did not apply to Harrington because she did not personally sign it. When the First DCA affirmed these rulings, certifying two questions the FSC, 1) Does the family vehicle exclusion conflict with Section 627.727(3), F.S.; and, 2) Are UM benefits stackable when the named insured expressly elected non-stacking UM coverage, but the insured claiming UM benefits did not expressly make an election, the FSC responded with a  negative to both questions. Under Florida law, UM benefits extend to “underinsured” as well as “uninsured” motorists. Harrington claimed that, because the bodily injury liability benefits did not fully cover her damages, she had a statutory right to UM benefits. Harrington argued that applying Travelers’ “family vehicle exclusion” to deny her claim for UM benefits conflicted with the law that extended UM benefits to underinsured motorists. However, the FSC relied on the fact that, although Section 627.727(3) (b), F.S. (2009) does extend UM coverage to underinsured motorists, the statute also expressly states that the term “uninsured motor vehicle” is “subject to the terms and conditions of such coverage.” The court explained that terms and conditions of the family vehicle exclusion clearly and unambiguously excluded the vehicle in question from UM coverage, and that the FSC has historically upheld similar policy definitions.  Obviously this is an important and interesting decision by the Florida Supreme Court and will provide guidance for future accidents and the claims that are presented under similar conditions.

Have an Amazing Thanksgiving

Next time you hear from us via our newsletter it will be December 1, therefore, the turkey and all your favorite “fixings” will be history.  We hope and pray for blessings for you, your family and friends during this very special American holiday of thanks.  WE are thankful every year for the great friends, colleagues, and clients that inspire us in all the areas of our lives.  So until we “see” you again, stay warm with the eggnog and all the love and friendships we are graced with in our amazing country.  Happy, Happy Thanksgiving from Lisa and the LMA Team.