Legislation clarifying the exempt status of Florida's nonadmitted insurance industry from compliance with rate and forms laws was signed earlier this month by Gov. Charles Crist.
The governor's decision was greeted with a sigh of relief from the industry's non-admitted underwriters, agents and brokers.
H.B. 853, sponsored by Rep. Pat Patterson, R-DeLand, and Sen. Mike Bennett, R-Bradenton, reverses a 2008 Florida Supreme Court decision in Essex v. Zoto.
That ruling applied the regulation of the admitted markets to surplus lines insurers, according to officials of the National Association of Professional Surplus Lines Offices, Ltd., (NAPSLO) and the Property Casualty Insurers Association of America (PCI).
The legislation not only reverses the ruling, it also makes important statutory fixes to restore the surplus lines market, NAPSLO and PCI officials said.
The bill's provisions became effective immediately.
Specifically, the new law affirms the industry's regulatory exemption retroactive to Oct. 1, 1988, the date the Florida Supreme Court's decision ruled previous legislation initiated the exemption of rate, but not form regulation.
The Florida House and Senate unanimously passed the legislation in May and sent the bill to the governor.
On Wednesday, representatives of the surplus lines industry met with the governor to explain the importance of the legislation to Florida consumers and encouraged him to sign the bill, industry trade officials said.
"We are pleased to see that the Governor signed the bill," said NAPSLO Executive Director Richard Bouhan.
"This is was an important victory for the industry and for the Working Group that had drafted and steered the legislation to unanimous approvals in the Florida House and Senate," he said.
William Stander, assistant vice president and regional manager for PCI, said, "This year's surplus lines legislation was a top priority as insurers work with lawmakers to strengthen the Florida marketplace."
He added, "Surplus line carriers play an integral role in protecting Florida and this new law was essential to the stability of the state."
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