News & Updates


Gov. Crist Signs Florida Surplus Lines Regulation Bill

Southeast News
June 12, 2009 

Legislation intended to clarify the regulation of the surplus lines insurance industry in Florida has beeen signed into law by Gov. Charlie Crist.

The legislation (HB 853) removes an ambiguity caused by two Florida Supreme Court rulings last year that suggested that surplus lines insurers are subject to state regulations that never before applied to them. If the court decisions had been allowed to stand, surplus lines insurers could have been required to get state approval for their policies in Florida, something that would alter the nature of their business enough that some in the industry fear carriers could leave the state rather than comply.

The industry, a market of last resort and high risk insurance, enjoys relative freedom from rate and form regulation in all states.

Under the legislation that officially passed on May 1, the industry’s regulatory exemption is restored in Florida retroactive to surplus insurance business written on or after Oct. 1, 1988.

Florida ranks as the fourth largest state in terms of surplus lines business, behind only California, Texas and New York. In 2008, it generated more than $4 billion in surplus lines premium, according to the Florida Surplus Lines Service Office.

This industry handles more than 700,000 excess and surplus lines policies a year; about 40 percent of them personal lines contracts for homes, condos, mobile homes and boats. The rest cover commercial entities, big and small, that could not obtain insurance they need in the standard markets.

HB 853 was sponsored by Rep. Pat Patterson (R-DeLand) and Sen. Mike Bennett (R-Bradenton) and supported by the insurance industry, including the Florida Surplus Lines Association.