Monday April 1, 2013
Lisa Miller & Assoc Week 4 Legislative Update
Even though it was supposed to be a “quiet week” in the Legislature somesparks still flew and some highly important bills gained traction and continued down the often perilous road to becoming law or changes to current law. This just goes to show there’s never a dull week when Florida’s lawmakers are in Tallahassee.
Civil Remedies against Insurers Reform Legislation (HB 813)
Of major importance is the much needed HB 813 (R-Passidomo-Collier) which addresses the bastion of unnecessary law suits against insurers and the “gotcha” tactics used by many among the trial bar. This bill was passed by the slimmest margin (7-6 vote) Wednesday by the House Civil Justice Subcommittee. The opposition was there in full-force, which makes it clear we are in for the toughest of fights down the stretch. I renew my call for your continued full involvement and support of our efforts to convince the Legislature this bill is truly critical to the survival of Florida’s property insurance market.
Reform of Florida’s PIP System (Again)
At the start of Session most of us were focused on recurring themes of how to revitalize Florida’s property insurance market and end Citizens’ rein as the “market of first resort.” However, like a brilliant novelist engaging in a bit of foreshadowing, Senate Banking & Insurance Committee Chair David Simmons (R-Seminole/Volusia), noted during the Committee’s first meeting this Session that PIP needed further addressing, especially in light of the U.S. Supreme Court’s decision affirming President Obama’s federal health care reform act. In other words, will Florida’s current auto personal injury protection coverage become duplicative of required coverage under federal health insurance reform? Fast forward to March 15 when Leon County Circuit Court Judge Terry Lewis struck down portions of Florida’s reformed no-fault auto insurance law (2012′ HB 119) and Chair Simmons begins to look clairvoyant. Although the Office of Insurance Regulation quickly filed notice of appeal with the DCA and Judge Lewis’ ruling was automatically stayed, his decision brought about calls from several state leaders to end the current PIP system in Florida. As if he knew all this was coming, Chair Simmons released proposed legislation this past Thursday night that would repeal Florida’s Motor Vehicle No-Fault Law and in the alternative, mandate bodily injury liability coverage at minimum limits of $25,000/$50,000, effective January 1, 2014. Review the Chairman’s proposed legislation here. I am looking forward to your thoughts and ideas about this proposal. As always, my team and I stand ready to battle for your interests.
Senate Appropriations Committee Continues Assault on Insurance Company Employee Tax Credit
As we reported last week, the Senate Appropriations Committee, Chaired by Joe Negron (R-Indian River, Martin, Palm Beach, St. Lucie) proposed reducing annual vehicle registration fees and offsetting the cost of this proposal on the backs of Florida insurers. In order to reduce the registration fees, the legislation (PCB 7132, sponsored by Chair Negron and supported by Senate President Don Gaetz) would eliminate the 15% insurance company employee tax credit, a tax credit which has been very helpful over the years to Florida’s economy and insurance sector employment. Unfortunately, this past Thursday (March 28) the Senate Appropriations Committee approved PCB 7132 claiming it would enhance premium tax collections annually by about $220 million and save Floridians the same amount in reduced vehicle registration fees. We continue to strongly believe that the elimination of this tax credit will bring further harm to our insurance marketplace in the form of reduced employment opportunities; as well as a damper on increased insurance capital and other insurance industry related ventures in our state. We need to remember the types of jobs that are provided through the insurance industry such as those in claims, underwriting, operations and marketing. These jobs are high skilled and well-paying as well as companies offering entry level programs for those wanting to be a part of the industry. During the committee meeting, members in support of the legislation challenged industry lobbyists to pinpoint the location of insurance-related jobs the tax credit has helped create and find an alternative tax source to fund a partial roll back in tax increases for motor vehicle registration. Please continue sharing your stories on how this legislation/budget proposal will adversely impact your business expansion plans in Florida and your ideas for alternative funding sources. We will continue to take your stories to the legislative body, even more loudly speaking to them about the adverse impact this will have on business, employment and economic opportunities in our great state.
House Insurance & Banking Subcommittee Action
The House Insurance and Banking Subcommittee met Thursday of this past week and considered a number of bills we’ve been monitoring and reporting on including HB 1107 by Committee Vice Chair, Bill Hager (R-Palm Beach). The bill regarding the Florida Hurricane CAT Fund was successfully passed by a 12-0 vote and became a Committee Substitute for HB 1107. Among other things, the bill deletes the May 31st scheduled repeal of the exemption of medical malpractice insurance premiums from emergency CAT Fund assessments. If this legislation becomes law, the exemption will be extended for another three years.
House Bill 1329 by Representatives Artiles (R-Miami/Dade) and Oliva (R-Miami/Dade) concerning the amount of fees public adjusters can charge consumers on Citizens covered claims was also heard; however, the bill was only discussed and no vote was taken. Under current law, a public adjuster can charge a fee of up to 10% of the amount paid on the claim by Citizens and on only the amount paid after Citizens makes its first offer. HB 1329 would increase this amount from 10% to 20%. Although only up for discussion, the bill prompted a very spirited back and forth dialog between sponsor Artiles and committee member John Tobia (R-Brevard) regarding the appropriateness of increasing public adjusting fees on Citizens claims and if such an increase occurred, whether homeowners would have sufficient funds remaining to make necessary repairs. This exchange signaled the likelihood of great debate should the bill be scheduled for a committee vote.
Disagreements between Industry and Regulators
(HB 1225)
Although not reported on earlier, an important piece of legislation is quietly making its way through the legislative process and if it passes, the insurance industry should have an easier time challenging improper agency rules. HB 1225 sponsored by Janet Adkins (R-Nassau/Duval) is a common sense change to Florida’s Administrative Procedures Act (Chapter 120, F.S.). Under current law, if an insurer, agent or other licensee believes that an unadopted statement or administrative rule adopted by OIR or the Department of Financial Services is unlawful because it constitutes an invalid exercise of delegated legislative authority, it is the insurer, agent or other adversely affected party who must prove such a challenge. Representative Adkins’ bill shifts that burden of proof to the state agency which promulgated or is attempting to promulgate such a statement or rule. It will be the state agency that has the burden to prove its statement or rule is not an invalid exercise of delegated legislative authority. The bill also amends the law allowing any party to request mediation of a rule challenge or in declaratory statement proceedings. Please contact Representative Adkins and thank her for proposing this legislation and showing concern about the hurdles regulated entities must often overcome to conduct business in Florida.
This Week (April 1 -5)
While the beginning of this week cries “April Fools,” every week during session can feel like a big joke. This week several bills we are following will be heard in committees and the debate will be loud. The cat fund for example has additional hearings and the policymakers are struggling over whether proposals to reduce rates should be implemented as a means to use the cat fund to help reduce Citizens or adopt proposals that keep rates the same but shrink the cat fund. My bet is that there will be a combination of both. The Senate version of the Citizens bill, with some pretty sporty changes, gets its third hearing on Wednesday and the House appears to be waiting for the Senate to send its ideas across the hall to their chamber. I received about 30 calls and emails from you this week with your ideas and your encouragement. It means a great deal to me to know you are there!
As always, my best,
Lisa
