Published on: March 12th, 2013 | Insurance
One of the Florida Office of Insurance Regulation’s (“FLOIR”) priorities for the 2013 legislative session is to have the legislature adopt the National Association of Insurance Commissioners’ holding company model act. Florida’s holding company registration requirements have remained largely unchanged for many years and no longer are consistent with requirements being adopted in other jurisdictions after the National Association of Insurance Commissioners’ promulgation of the Insurance Holding Company System Model Regulation. Both chambers of the Florida legislature have introduced bills in the current session that would give the FLOIR the necessary authority to adopt updated requirements. This blog discusses Florida’s current holding company registration and reporting requirements.
Current Holding Company Registration and Reporting Requirements
The Florida Insurance Code provides very little statutory guidance relating to holding company registration and reporting. The current Section 628.801, Florida Statutes, simply provides that every member of an insurance holding company system in Florida must register with the FLOIR on forms adopted by rule. The statute indicates that any such rule adopted by the FLOIR should include the requirements and standards set forth in the NAIC’s model acts and regulations as they existed on November 30, 2001. Section 628.802, Florida Statutes, then allows the FLOIR to seek injunctive relief against any company it believes has committed or is about to commit any violation of the holding company statutes and rules, and Section 628.803, Florida Statutes, allows the FLOIR to impose penalties on insurers failing to file registration statements or engaging in transactions that do not comply with holding company regulations.
The Florida Administrative Procedure Act provides strict requirements relating to agencies’ rulemaking. In general, an administrative agency in Florida may promulgate rules only when the legislature has provided a specific statutory grant of rulemaking authority. The Office of Insurance Regulation therefore is not able to adopt the full scope of the model act and regulations by administrative rule. Florida’s primary holding company registration and reporting requirements presently are found in administrative rules 69O-143.046 and 69O-143.047, Florida Administrative Code. The former requires insurers to register within 15 days of becoming subject to the rule and to update their registrations within 15 days of the end of months in which changes occur. The rule adopts a form to be used by insurers submitting their registration statements, but the listed edition date of November 1990 underscores how long Florida’s holding company registration requirements have been substantially unchanged. The rule requires a reporting insurer to identify its capital structure and the capital structure of its controlling person, the identity of every member of the holding company system, and various types of transactions that might exist between the insurer and an affiliate. The rule allows an otherwise affected person to file a disclaimer of affiliation, which relieves that party of further duties to report under the rule unless the FLOIR disallows the disclaimer after notice and an opportunity to be heard.
In tomorrow’s article, I’ll discuss the proposed statutory revisions on tap for 2013.