FL Stat § 631.914 (2021)
2021 Florida Statutes|Title XXXVII - Insurance|Chapter 631 - Insurer Insolvency; Guaranty of Payment|Part V - Florida Workers’ Compensation Insurance Guaranty Association (Ss. 631.901-631.932)|631.914 - Assessments.

631.914 Assessments.—(1)(a) To the extent necessary to secure the funds for the payment of covered claims, and also to pay the reasonable costs to administer the same, the Office of Insurance Regulation, upon certification by the board, shall levy assessments on each insurer. Assessments levied against insurers and self-insurance funds pursuant to this paragraph must be computed and levied on the basis of the direct written premium amount as set forth in the state for workers’ compensation insurance. An insurer’s direct written premium calculated for the purposes of determining the insurer’s assessment or policy surcharge may not be reduced by any discount or credit for deductibles in a policy or by any premium adjustment to a retrospectively rated policy. Insurers and self-insurance funds must report premiums in compliance with this paragraph, and the association may audit the reports. Assessments shall be remitted to and administered by the board of directors in the manner specified by the approved plan of operation and paragraph (d). Assessments levied against insurers and self-insurance funds shall not exceed in any calendar year more than 2 percent of that insurer’s direct written premiums in this state for workers’ compensation insurance.(b) If assessments otherwise authorized in paragraph (a) are insufficient to make all payments on reimbursements then owing to claimants in a calendar year, then upon certification by the board, the office shall levy additional assessments of up to 1.5 percent of the insurer’s direct written premiums in this state.(c) The office shall levy the uniform surcharge percentage on all policies of the same kind or line as were considered by the office in determining the assessment liability of the insurer. Member insurers shall collect policy surcharges at a uniform percentage rate on new and renewal policies issued and effective during the period of 12 months beginning on January 1, April 1, July 1, or October 1, whichever is the first day of the following calendar quarter as specified in an order issued by the office. The policy surcharge may not begin until 90 days after the board of directors certifies the assessment.(d) The association may use an installment method to require the insurer to remit the policy surcharge as collected or may require the insurer to remit the assessment to the association before collecting the policy surcharge.1. If the association elects to use the installment method, the office may, in the order levying the assessment on insurers, specify that the policy surcharge is due and payable quarterly as collected throughout the assessment year. Insurers shall collect policy surcharges at a uniform percentage rate specified by order as described in paragraph (c). Insurers are not required to advance funds if the association and the office elect to use the installment option. Assessments levied under this subparagraph are paid after policy surcharges are collected, and the recognition of assets is based on actual policy surcharges collected offset by the obligation to the association.2. If the association elects to require insurers to remit the assessment before surcharging the policy, the following shall apply:a. On or before the date specified in the order of the office, insurers shall make an initial payment to the association of the percentage specified in the order multiplied by the insurer’s direct written premiums received in this state for the preceding calendar year for the kinds of insurance included within such account before the beginning of the assessment year.b. The levy order shall provide each insurer so assessed at least 30 days’ written notice of the date the initial assessment payment is due and payable by the insurer.c. Insurers shall collect policy surcharges at a uniform percentage rate specified by the order, as described in paragraph (c).d. Assessments levied under this subparagraph and paid by an insurer constitute advances of funds from the insurer to the association and result in a receivable for policy surcharges to be billed in the future. The amount of billed policy surcharges, to the extent it is likely that it will be realized, meets the definition of an admissible asset as specified in the National Association of Insurance Commissioners’ Statement of Statutory Accounting Principles No. 4. The asset shall be established and recorded separately from the liability. If an insurer is unable to fully recoup the amount of the assessment, the amount recorded as an asset shall be reduced to the amount reasonably expected to be recouped.3. Insurers must submit a reconciliation report to the association within 120 days after the end of the 12-month assessment period and annually thereafter for a period of 3 years. The report must indicate the amount of the initial payment or installment payments made to the association and the amount of policy surcharges collected for the assessment year. If the insurer’s reconciled obligation is more than the amount paid to the association, the insurer shall pay the excess policy surcharges collected to the association. If the insurer’s reconciled obligation is less than the initial amount paid to the association, the association shall return the overpayment to the insurer.(2) Policy surcharges collected under this section are not premium and are not subject to any premium tax, fees, or commissions. Insurers shall treat the failure of an insured to pay policy surcharges as a failure to pay premium. An insurer is not liable for any uncollectible policy surcharges levied pursuant to this section.(3) Assessments levied under this section may be levied only upon insurers. This section does not create a cause of action by a policyholder with respect to the levying of an assessment or a policyholder’s duty to pay assessment-related policy surcharges.(4)(a) The board may exempt any insurer from an assessment if, in the opinion of the office, an assessment would result in such insurer’s financial statement reflecting an amount of capital or surplus less than the minimum amount required by any jurisdiction in which the insurer is authorized to transact insurance.(b) The board may temporarily defer, in whole or in part, assessments against an insurer if, in the opinion of the office, payment of the assessment would endanger the ability of the insurer to fulfill its contractual obligations. In the case of a self-insurance fund, the trustees of the fund determined to be endangered must immediately levy an assessment upon the members of that self-insurance fund in an amount sufficient to pay the assessments to the corporation.(c) The board may allow an insurer to pay an assessment on a quarterly basis.History.—s. 20, ch. 97-262; s. 48, ch. 99-3; s. 6, ch. 2003-267; s. 1, ch. 2016-170; s. 7, ch. 2020-54.