The Legislature's Special Session dealing solely with the Insurance Crisis just wrapped up and below is a summary of the the results:

1. Heighten standards for Florida-only subsidiaries (Pup Companies)
• Require all Florida-only subsidiaries to have a surplus of at least $50 million in liquid assets to help ensure that policyholders can receive payment when they need it.

2. Greater Accountability in Rate Filing
• Prohibit excess profits by property insurers and require return of excess profits to policyholders. An insurance company earns an excess profit when its surplus (cash on hand) exceeds its PML (total projected loss) for a 250-year return period and it has earned a net underwriting gain (actual premiums – losses + expenses) in Florida in excess of 10% above its anticipated underwriting profit over the most recent 10-year period.
• Suspend until December 31, 2008 the "use and file" procedure for rate increases. Insurance companies will have to seek and obtain OIR approval before implementing a rate increase during this two year period.
• Suspend until December 31, 2008 the arbitration procedure for resolving rate disputes. During this two year period, all rate filing disputes would be settled according to the Administrative Procedures Act within the Department of Administrative Hearings.
• Require an oath of truth, with penalty of perjury, for rate filings. Rate filings must be signed by the insurance company’s CEO or CFO and actuary. The signed oath must state the rate filing reflects all premium savings reasonably expected to result from legislative enactments. Violation is an unfair trade practice, subjecting the insurance company to disciplinary actions against its license.

2 • Require insurance companies to evaluate the hurricane-security of a structure rather than the date of construction when determining risk. Age of the home may not be used as the sole reason for rejection of coverage.

3. Require participation in the Florida property insurance market (Cherry Picking)
• Require any insurance company that writes homeowners policies in other states and writes auto insurance in Florida to sell homeowners insurance in Florida, unless the affiliate writes homeowners in Florida. This is effective January 1, 2008.

4. Additional Miscellaneous Insurance Company Accountability Measures
• Require insurance companies to provide greater loss reporting information to OIR.
• Require insurance companies to give at least 100 days written notice, or written notice by June 1, whichever is earlier, for any non-renewal, cancellation, or termination of a homeowners’ policy that would be effective between June 1 and November 30.
• Require insurance companies to expedite payment of claims following a storm. Insurance companies must pay or deny property claim within 90 days of notice of the claim with an exception for factors beyond the control of the insurer. Violation is subject to penalty under the Insurance Code, subjecting the insurance company to disciplinary actions against its license.