Florida Regulations 69O-199.005: Financial Requirements Regarding the Funded, Unearned Premium Reserve Account
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(1)(a) “”Gross premium”” means the total amount of premium paid by the consumer, inclusive of commissions.
(b) “”Gross Written Premiums”” means the total amount of premiums paid by the consumer, paid for the entire period of the home warranty, inclusive of commissions, for which the association is obligated under home warranties issued.
(c) “”Obligated”” means outstanding warranties in force which have not expired or been canceled and a refund made to the consumer.
(2)(a) Written contracts are required on all sales made between the home warranty association and the consumer.
(b) The serially numbered contract shall include:
1. The selling price to the ultimate consumer;
2. Issuing sales representative;
3. Date issued;
4. Name and street address of warranty holder;
5. Warranty period; and
6. Other information pertinent to the transaction.
(c) Copies of all warranty contracts shall be maintained by the association for a period of at least four years after expiration of the contract. For purposes of records kept on computer file pursuant to Florida Statutes § 634.3135, a single computer copy may be kept of any form that is uniformly distributed to contract holders, if that computer record exactly duplicates the form sent to all contract holders.
(3) The unearned premium reserve account is calculated as follows: the minimum reserve for all home warranty associations shall be 25 percent of the gross written premium for which the association is obligated on all contracts, issued in this state.
(4) The unearned premium reserve account shall be totally funded and identified at all times by unencumbered assets. Those prescribed assets funding the unearned premium reserve shall be clearly designated for this purpose and such reserve account must be a separate auditable account for contracts in force in this state.
(5) The ratios required by Florida Statutes § 634.3077(2), are net assets to gross written premiums for which the association is obligated, wherever written, in any state, except that the ratio of net assets to gross written premiums may be less if the association has net assets of not less than $500,000 and maintains a funded, unearned premium reserve account equal to a minimum of 40 percent of the gross written premiums received by it from all warranty contracts in force in this state.
Rulemaking Authority 634.302 FS. Law Implemented 634.3077, 634.3135 FS. History-New 7-16-92, Formerly 4-199.005, Amended 5-25-21.
Terms Used In Florida Regulations 69O-199.005
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Contract: A legal written agreement that becomes binding when signed.
(c) “”Obligated”” means outstanding warranties in force which have not expired or been canceled and a refund made to the consumer.
(2)(a) Written contracts are required on all sales made between the home warranty association and the consumer.
(b) The serially numbered contract shall include:
1. The selling price to the ultimate consumer;
2. Issuing sales representative;
3. Date issued;
4. Name and street address of warranty holder;
5. Warranty period; and
6. Other information pertinent to the transaction.
(c) Copies of all warranty contracts shall be maintained by the association for a period of at least four years after expiration of the contract. For purposes of records kept on computer file pursuant to Florida Statutes § 634.3135, a single computer copy may be kept of any form that is uniformly distributed to contract holders, if that computer record exactly duplicates the form sent to all contract holders.
(3) The unearned premium reserve account is calculated as follows: the minimum reserve for all home warranty associations shall be 25 percent of the gross written premium for which the association is obligated on all contracts, issued in this state.
(4) The unearned premium reserve account shall be totally funded and identified at all times by unencumbered assets. Those prescribed assets funding the unearned premium reserve shall be clearly designated for this purpose and such reserve account must be a separate auditable account for contracts in force in this state.
(5) The ratios required by Florida Statutes § 634.3077(2), are net assets to gross written premiums for which the association is obligated, wherever written, in any state, except that the ratio of net assets to gross written premiums may be less if the association has net assets of not less than $500,000 and maintains a funded, unearned premium reserve account equal to a minimum of 40 percent of the gross written premiums received by it from all warranty contracts in force in this state.
Rulemaking Authority 634.302 FS. Law Implemented 634.3077, 634.3135 FS. History-New 7-16-92, Formerly 4-199.005, Amended 5-25-21.