Florida Gov. Charlie Crist has signed into law a bill exempting certain commercial and professional liability insurance rates from state review prior to use.
Current state law exempts only those policies with annual premiums above $500,000 in addition to other criteria.
The commercial lines deregulation bill that Crist signed, SB 2176, excludes from review rates for commercial lines insurance risks, excluding property and medical malpractice coverage, producing an annual premium of $25,000 or more.
It also gives the Office of Insurance Regulation (OIR) the authority to designate any other commercial lines categories of insurance or commercial lines risks that it determines should not be subject to the filing and review requirements.
In terms of specific risks, the new law exempts from review rates for commercial motor vehicles; errors and omissions; professional liability, except medical malpractice coverage; directors and officers; employment practices and management liability; intellectual property and patent infringement liability; advertising injury and Internet liability; environmental liability; property risks rated under a highly protected risks rating plan; and unique or unusual risks or portions of risks not rated according to manuals, rating plans, or rate schedules, including “A” rates.
Under SB 2176, insurers will still be required to develop rates that are subject to legal standards of not being excessive, inadequate or unfairly discriminatory.
Insurers had pushed the deregulation measure.
Cecil Pearce, the American Insurance Association’s vice president of state affairs, Southeast Region, said it was one of his group’s priorities.
“The bill was supported by the state’s major business organizations because it will help meet the commercial insurance needs of Florida’s businesses,” Pearce said. “Insurers will be better positioned to respond to the state’s evolving commercial insurance needs in the years ahead.”
In other insurance legislation news, Crist vetoed a bill (HB 5603) that lawmakers unanimously passed and CFO Alex Sink recommended that was designed to strengthen the state’s risk management program and reduce workers compensation costs to the state.
Sink, who is running for governor, said she was “very disappointed” that Crist chose to “favor special interests instead of Florida taxpayers” with his veto.
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