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New Law Revises FIGA Recoupment Process

New Law Revises FIGA Recoupment Process

A bill passed in the 2010 legislative session relating to recouping Florida Insurance Guaranty Association assessments will become law effective July 1, 2010.  The new law (Chapter Law 2010-49) streamlines the process by which insurers may recoup assessments levied by FIGA.  An insurer seeking to recoup an assessment will make an informational filing with the Florida Office of Insurance Regulation at least 15 days before applying a recoupment factor.  The recoupment typically will be recovered through a factor calculated to result in full recovery over a 12-month period.  If the insurer has not fully recouped the assessment over 12 months and wishes to continue the recoupment, it will recalculate an assessment percentage to be applied over a subsequent 12-month period.  The insurer also is required to make an informational filing within 90 days of the end of a recoupment.

If an insurer over-recoups the assessment, it may simply remit the excess recoupment to FIGA is the excess is not more than 15% of the total recoupment.  If the excess collection exceeds 15% of the total, the insurer will be required to issue refunds or credits to current policyholders. 

The new law takes effect July 1, 2010.