Florida’s Governor Rick Scott approved several proposals considered by the Legislature in its 2016 regular session that will have a significant impact on the state’s insurance industry. The Governor signed into state law a bill adopting National Association of Insurance Commissioners (NAIC) Model Acts, and other legislation affecting sinkhole insurance, workers’ compensation, health insurance, and life insurance:
ORSA & CGAD
The NAIC’s Risk Management and Own Risk Solvency Assessment (ORSA) Model Act and the Corporate Governance Annual Disclosure (CGAD) Model Act will require Florida insurers to submit an ORSA summary report to the Florida Office of Insurance Regulation (FLOIR), beginning on December 31, 2017. The legislation offers some flexibility to the form and content of the summary report and provides an exemption from the report requirement for insurers with direct premiums below $500 million and an insurance group of which the insurer is a member with premiums below $1 billion. However, the FLOIR may require an exempt insurer to file an ORSA summary report if there are “unique circumstances.” Other insurers are allowed to request a waiver of the ORSA report requirement.
Under the CGAD provisions of the legislation, insurers must submit their disclosures to the FLOIR starting on December 31, 2018. This is designed to give the FLOIR sufficient information on insurer governance structures, practices and processes between examinations.
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