Florida's Legislative Session recently convened with a number oflegislative proposals related to insurance under review. Thesession, scheduled to adjourn on May 3, promises active debate ofvarious proposals geared to address Florida's ailing insurancemarket.

Here are some things to keep track of as the sessionprogresses:

Florida House and Senate Leadership

The Chair of the House Insurance and Banking Subcommitteeremains Bryan Nelson, a Republican and an insurance agent fromApopka. The Vice Chair is now Representative Bill Hager (R,Boca Raton), a former insurance regulator.

The makeup of the Senate Banking and Insurance Committee haschanged substantially. The Chair is now David Simmons, who is alawyer from Orlando. Its vice chair, Jeff Clemens (D, Lake Worth),is a former newspaper reporter and energy contractor.

These representatives, along with Gov. Rick Scott, will take asignificant role in shaping the issues considered in this year'ssession.

Homeowners' Insurance

An omnibus homeowners' insurance bill, SB 1770, is underconsideration by the Legislature. This bill would make some broadchanges to Citizens Property Insurance Corp. It would create amechanism that is referred to as a “clearinghouse” to allow agentsand consumers to shop policies with all participating insurers inan effort to keep homeowners' policies out of Citizens.

Citizens has recently estimated that over half of the newbusiness coming into Citizens is from captive agents, and onereason for this could be that many homeowners choose coverage fromCitizens simply because they are unaware of other options. Thisbill would establish a clearinghouse to better assure thatconsumers know of all private market options that may beavailable. There would be an enhanced application forcoverage, and insurance agents submitting applications to theclearinghouse would retain control of the expirations.

Any new policies with a private market offer of coverage within15 percent of Citizens' rate would be ineligible for Citizens.Renewal policies would be ineligible for Citizens coverage if aprivate carrier's rate is within 5 percent of Citizens'rate.

In addition, the bill includes measures to reduce Citizens'maximum policy limit from $2 million to $1 million; to prohibitCitizens coverage of new coastal policies not built to code-plusstandards; and to require Citizens' rates to be actuarially soundand non-competitive with the private market.

Other proposed Citizens-related legislation includes aprohibition on payment of agent commissions for ineligible policiesplaced in Citizens after January 1, 2014; the disclosure ofpotential surcharges and assessments with each renewal notice; andthe establishment of an auditor-general of Citizens'finances.

The bill would also create a Florida Catastrophe Risk CapitalAccess Facility within the State Board of Administration to helpinsurers identify global capital that is available for additionalcoverage options around the various layers of the Florida HurricaneCatastrophe Fund.

Workers' Compensation Insurance

The Legislature is considering a bill to allow a commercialwrap-up policy to include large-deductible workers' compensationcoverage. There are also several bills filed concerning drugrepackaging and relabeling. Finally, there is also a “clean up”package that would make numerous technical changes to severalworkers' compensation statutes.

Automobile Insurance

HB 341, regarding uninsured motorist coverage, has alreadypassed through some House committees with little discussion ordebate. This bill would allow the insured to choose either stackedor nonstacked coverage to be applied to all insureds covered underthe policy. There is also a proposed ban on texting while drivingthat is moving through the legislative process despite failedefforts to pass this ban over the past several LegislativeSessions.

General Insurance

More generally, several bills have been filed that, if enacted,would allow insurers to deliver insurance policies via electronicmail, or through a secure website, instead of just by mail. Thereare also proposed bills to authorize the Florida Insurance GuarantyAssociation to collect regular assessments directly frompolicyholders.

In the annuities arena, CS/SB 166 would make changes to theduties of insurers and agents when recommending annuities; thecurrently-required consumer disclosures; and the trainingrequirements for agents selling annuities, among otherthings.

Additionally, a major issue that will be addressed in the 2013Legislative Session is the implementation of the health carereforms required by the federal Patient Protection and AffordableCare Act of 2010. Although Gov. Scott recently endorsed anexpansion of Florida's Medicaid program–at least for three yearswhile a substantial amount of federal funding isavailable–Republicans hold significant majorities in both chambersof the Florida Legislature and both chambers recently voted againstMedicaid expansion.