Florida Regulations 69O-175.011: Deductibles in Mandatory Financial Responsibility Coverages
Current as of: 2024 | Check for updates
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(1) Purpose and Scope.
(a) This rule applies only to commercial motor vehicle liability coverages used to satisfy mandatory financial responsibility requirements of state or local government.
(b)1. This rule does not apply to private passenger automobile coverages or to any mandatory liability coverages other than commercial motor vehicles coverages.
2. This rule shall not be interpreted as creating an inference as to allowable terms of coverages and deductibles in coverages other than commercial motor vehicle coverages.
(c) This rule does not apply to policies issued in conjunction with a valid certificate of deposit issued by the Department of Highway Safety and Motor Vehicles pursuant to Florida Statutes § 324.031(3)
(2) Definitions. The following definitions apply for purposes of this rule:
(a) “”Office”” refers to the Florida Office of Insurance Regulation.
(b) “”First dollar coverage”” means that the insurer’s liability commences at the first dollar of the third party claimant’s loss, without allowance for any deductible.
(c) “”First party claimant”” means the insured.
(d) “”First party deductible”” means a deductible that is applied to reduce the insurer’s liability to an insured occurring out of a loss suffered by an insured to the insured’s property.
(e) “”Third party claim”” means a claim by a third party claimant for loss caused by the insured.
(f) “”Third party claimant”” means any claimant that is not the insured.
(g) “”Third party deductible”” means any deductible applied to reduce the insurer’s liability occurring out of any third party claim.
(3) General Exemptions. The requirements of this rule shall not apply to the extent that the statute or ordinance requiring the coverage expressly authorizes a coverage or deductible otherwise prohibited by this rule.
(4) Requirements.
(a) Policies subject to this rule must provide first dollar coverage by the insurer to third party claimants for losses for which the insured is liable.
(b) No policy subject to this rule shall contain a third party deductible that is or by its terms may be asserted by or on behalf of or for the benefit of the insurer, against a third party claim or claimant.
(c) A policy form that by its terms allows but does not require the insurer to provide first dollar coverage, or contains a third party deductible which by its terms may be asserted by the insurer at the option of the insurer or insured, does not comply with the requirements of this rule.
(d) Policies subject to this rule shall provide and require:
1. That all third party claims under the policies shall at all stages be processed and adjusted by the insurer, or by other licensed adjusters duly appointed by the insurer as shown in the records of the Office;
2. That at no time shall the insured process, adjust, or otherwise handle such claims except through a licensed adjuster duly appointed by the insurer as shown in the records of the Office; and,
3. That all claims payments, up to policy limits, on third party claims shall be made by or on the draft of the insurer to the third party claimant.
(5) Reimbursement Provisions.
(a) This rule shall not be construed to prohibit the use of policy provisions which require or obligate the insured to reimburse the insurer for a specified amount of each third party claim paid by the insurer, whether or not the obligation is collateralized or pre-funded by the insured.
(b)1. The following shall not be a defense to the insurer’s liability for first-dollar coverage on any third party claims occurring under the insurance;
a. A deficiency, failure, or defect in the fund or collateral;
b. The insurer’s inability to collect the reimbursement; or
c. The insured’s refusal or inability to pay the reimbursement.
2. Any cancellation of the policy due to deficiency, refusal, or inability to pay shall not be retroactive in effect regarding third party claimants with previously occurring claims.
(c) If the reimbursement provisions are referred to in the policy as deductibles, the policy shall clearly and expressly state that the deductible is a first party deductible and may not be asserted against a third party claimant.
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 626.9541(1)(a)1., 627.411(1)(b), (c) FS. History-New 10-4-94, Formerly 4-175.011.
Terms Used In Florida Regulations 69O-175.011
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Statute: A law passed by a legislature.
(b)1. This rule does not apply to private passenger automobile coverages or to any mandatory liability coverages other than commercial motor vehicles coverages.
2. This rule shall not be interpreted as creating an inference as to allowable terms of coverages and deductibles in coverages other than commercial motor vehicle coverages.
(c) This rule does not apply to policies issued in conjunction with a valid certificate of deposit issued by the Department of Highway Safety and Motor Vehicles pursuant to Florida Statutes § 324.031(3)
(2) Definitions. The following definitions apply for purposes of this rule:
(a) “”Office”” refers to the Florida Office of Insurance Regulation.
(b) “”First dollar coverage”” means that the insurer’s liability commences at the first dollar of the third party claimant’s loss, without allowance for any deductible.
(c) “”First party claimant”” means the insured.
(d) “”First party deductible”” means a deductible that is applied to reduce the insurer’s liability to an insured occurring out of a loss suffered by an insured to the insured’s property.
(e) “”Third party claim”” means a claim by a third party claimant for loss caused by the insured.
(f) “”Third party claimant”” means any claimant that is not the insured.
(g) “”Third party deductible”” means any deductible applied to reduce the insurer’s liability occurring out of any third party claim.
(3) General Exemptions. The requirements of this rule shall not apply to the extent that the statute or ordinance requiring the coverage expressly authorizes a coverage or deductible otherwise prohibited by this rule.
(4) Requirements.
(a) Policies subject to this rule must provide first dollar coverage by the insurer to third party claimants for losses for which the insured is liable.
(b) No policy subject to this rule shall contain a third party deductible that is or by its terms may be asserted by or on behalf of or for the benefit of the insurer, against a third party claim or claimant.
(c) A policy form that by its terms allows but does not require the insurer to provide first dollar coverage, or contains a third party deductible which by its terms may be asserted by the insurer at the option of the insurer or insured, does not comply with the requirements of this rule.
(d) Policies subject to this rule shall provide and require:
1. That all third party claims under the policies shall at all stages be processed and adjusted by the insurer, or by other licensed adjusters duly appointed by the insurer as shown in the records of the Office;
2. That at no time shall the insured process, adjust, or otherwise handle such claims except through a licensed adjuster duly appointed by the insurer as shown in the records of the Office; and,
3. That all claims payments, up to policy limits, on third party claims shall be made by or on the draft of the insurer to the third party claimant.
(5) Reimbursement Provisions.
(a) This rule shall not be construed to prohibit the use of policy provisions which require or obligate the insured to reimburse the insurer for a specified amount of each third party claim paid by the insurer, whether or not the obligation is collateralized or pre-funded by the insured.
(b)1. The following shall not be a defense to the insurer’s liability for first-dollar coverage on any third party claims occurring under the insurance;
a. A deficiency, failure, or defect in the fund or collateral;
b. The insurer’s inability to collect the reimbursement; or
c. The insured’s refusal or inability to pay the reimbursement.
2. Any cancellation of the policy due to deficiency, refusal, or inability to pay shall not be retroactive in effect regarding third party claimants with previously occurring claims.
(c) If the reimbursement provisions are referred to in the policy as deductibles, the policy shall clearly and expressly state that the deductible is a first party deductible and may not be asserted against a third party claimant.
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 626.9541(1)(a)1., 627.411(1)(b), (c) FS. History-New 10-4-94, Formerly 4-175.011.