Fla. Stat. 215.5552
Florida Optional Reinsurance Assistance program
(1)
CREATION OF THE FLORIDA OPTIONAL REINSURANCE ASSISTANCE PROGRAM.—There is created the Florida Optional Reinsurance Assistance program to be administered by the State Board of Administration.(2)
DEFINITIONS.—As used in this section, the term:“Board” means the State Board of Administration.“Contract year” has the same meaning as in s. 215.555(2)(o).“Covered event” has the same meaning as in s. 215.555(2)(b).“Covered policy” has the same meaning as in s. 215.555(2)(c).“FHCF” means the Florida Hurricane Catastrophe Fund created under s. 215.555.“Final FORA premium” means the premium due no later than March 1, 2024, paid by a FORA insurer after the actual 2023 FHCF premiums are calculated.“FORA” means the Florida Optional Reinsurance Assistance program created under this section.“FORA eligible insurer” means a FHCF participating insurer as of November 30, 2022. New FHCF participants after that date are ineligible for FORA coverage. In addition, any joint underwriting association, risk apportionment plan, or other entity created under s. 627.351 is not considered a FORA insurer and may not obtain coverage under FORA.“FORA insurer” means a FORA eligible insurer that executes a FORA reimbursement contract pursuant to this section.“FORA layer limit” means, for the 2023-2024 contract year, a FORA insurer’s maximum payout for its FORA layer.“FORA layer retention” means the amount of losses below which a FORA insurer is not entitled to reimbursement for the selected layer under FORA.“FORA payout multiple” means the factors by FHCF coverage and FORA layer that are multiplied by a FORA insurer’s FHCF premium to calculate the FORA insurer’s FORA layer limits.“FORA reimbursement contract” means the reimbursement contract reflecting the obligations of a FORA insurer and the board.“FORA retention multiple” means the factors by FHCF coverage and FORA layer that are multiplied by a FORA insurer’s FHCF premium to calculate the FORA insurer’s FORA layer retentions.“Initial FORA premium” means the premium paid by a FORA insurer by July 1, 2023, for coverage under the FORA program.“Losses” has the same meaning as in s. 215.555(2)(d).“RAP insurer” has the same meaning as in s. 215.5551(2)(h).“Unsound insurer” means a FORA insurer determined by the Office of Insurance Regulation to be in unsound condition as defined in s. 624.80(2) or a FORA insurer placed in receivership under chapter 631.(a)
“Board” means the State Board of Administration.(b)
“Contract year” has the same meaning as in s. 215.555(2)(o).(c)
“Covered event” has the same meaning as in s. 215.555(2)(b).(d)
“Covered policy” has the same meaning as in s. 215.555(2)(c).(e)
“FHCF” means the Florida Hurricane Catastrophe Fund created under s. 215.555.(f)
“Final FORA premium” means the premium due no later than March 1, 2024, paid by a FORA insurer after the actual 2023 FHCF premiums are calculated.(g)
“FORA” means the Florida Optional Reinsurance Assistance program created under this section.(h)
“FORA eligible insurer” means a FHCF participating insurer as of November 30, 2022. New FHCF participants after that date are ineligible for FORA coverage. In addition, any joint underwriting association, risk apportionment plan, or other entity created under s. 627.351 is not considered a FORA insurer and may not obtain coverage under FORA.(i)
“FORA insurer” means a FORA eligible insurer that executes a FORA reimbursement contract pursuant to this section.(j)
“FORA layer limit” means, for the 2023-2024 contract year, a FORA insurer’s maximum payout for its FORA layer.(k)
“FORA layer retention” means the amount of losses below which a FORA insurer is not entitled to reimbursement for the selected layer under FORA.(l)
“FORA payout multiple” means the factors by FHCF coverage and FORA layer that are multiplied by a FORA insurer’s FHCF premium to calculate the FORA insurer’s FORA layer limits.(m)
“FORA reimbursement contract” means the reimbursement contract reflecting the obligations of a FORA insurer and the board.(n)
“FORA retention multiple” means the factors by FHCF coverage and FORA layer that are multiplied by a FORA insurer’s FHCF premium to calculate the FORA insurer’s FORA layer retentions.(o)
“Initial FORA premium” means the premium paid by a FORA insurer by July 1, 2023, for coverage under the FORA program.(p)
“Losses” has the same meaning as in s. 215.555(2)(d).(q)
“RAP insurer” has the same meaning as in s. 215.5551(2)(h).(r)
“Unsound insurer” means a FORA insurer determined by the Office of Insurance Regulation to be in unsound condition as defined in s. 624.80(2) or a FORA insurer placed in receivership under chapter 631.(3)
COVERAGE.—Each FORA eligible insurer may purchase coverage under FORA. The board shall provide four optional layers below the FHCF retention prior to the third event dropdown of the FHCF retention set forth in s. 215.555(2)(e)4. Only RAP insurers required to participate in the 2022-2023 contract year may select FORA layers 1 through 3. All FORA eligible insurers may purchase FORA layer 4. If a RAP insurer required to participate in the 2022-2023 contract year chooses to purchase layer 2, 3, or 4, such layers must be purchased inclusive of the prior layer and cannot be purchased separately.FORA industry limits prior to FORA insurer selections are as follows:FORA industry layer 1 limit is $1 billion.
FORA industry layer 2 limit is $1 billion.
FORA industry layer 3 limit is $2 billion divided by the RAP Qualification ratio minus $2 billion.
FORA industry layer 4 limit is $1 billion minus the total FORA industry limit selected for FORA layers 1, 2, and 3, plus the total FORA premium collected for FORA layers 1, 2, and 3.
The maximum aggregate coverage for all selected FORA layers is $1 billion as provided under paragraph (11)(a) plus premiums needed to fulfill the obligations of this section.(a)
Each FORA eligible insurer may purchase coverage under FORA. The board shall provide four optional layers below the FHCF retention prior to the third event dropdown of the FHCF retention set forth in s. 215.555(2)(e)4. Only RAP insurers required to participate in the 2022-2023 contract year may select FORA layers 1 through 3. All FORA eligible insurers may purchase FORA layer 4. If a RAP insurer required to participate in the 2022-2023 contract year chooses to purchase layer 2, 3, or 4, such layers must be purchased inclusive of the prior layer and cannot be purchased separately.(b)
FORA industry limits prior to FORA insurer selections are as follows:FORA industry layer 1 limit is $1 billion.FORA industry layer 2 limit is $1 billion.FORA industry layer 3 limit is $2 billion divided by the RAP Qualification ratio minus $2 billion.FORA industry layer 4 limit is $1 billion minus the total FORA industry limit selected for FORA layers 1, 2, and 3, plus the total FORA premium collected for FORA layers 1, 2, and 3.(c)
The maximum aggregate coverage for all selected FORA layers is $1 billion as provided under paragraph (11)(a) plus premiums needed to fulfill the obligations of this section.(4)
FORA REIMBURSEMENT CONTRACTS.—FORA eligible insurers selecting coverage must execute a FORA reimbursement contract with the board.The board must enter into a FORA reimbursement contract effective June 1, 2023, with each FORA eligible insurer electing to purchase coverage. Such contract must provide coverage pursuant to this section in exchange for premium paid.The FORA reimbursement contract must be executed by the FORA insurer no later than April 15, 2023, for layers 1 through 3, and May 30, 2023, for layer 4.For the two covered events with the largest losses for the FORA insurer, the FORA reimbursement contract must contain a promise by the board to reimburse the FORA insurer for 100 percent of its losses from each covered event in excess of the lowest selected FORA layer’s retention. The sum of the FORA insurer’s covered losses from the two covered events with the largest losses from each FORA layer may not exceed the FORA insurer’s combined selected FORA layer limit or limits.The FORA reimbursement contract must provide that reimbursement amounts are not reduced by reinsurance paid or payable to the insurer from other sources.The board shall calculate and report to each FORA insurer the initial and final FORA payout multiples for each FORA layer using the source data described in paragraph (5)(a).For FORA layer 1, the FORA payout multiple is the quotient of $1 billion divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected.
For FORA layer 2, the FORA payout multiple is the quotient of $1 billion divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected.
For FORA layer 3, the FORA payout multiple is calculated as follows: the numerator is the quotient of $2 billion divided by the RAP qualification ratio as defined in s. 215.5551(2)(j) minus $2 billion. The denominator is the FHCF industry aggregate retention. The FORA multiple is the FHCF retention multiple multiplied by the numerator divided by the denominator.
The FORA layer 4 payout multiple is the total FORA industry layer 4 limit divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected. For FORA layer 4, the total FORA industry layer limit is $1 billion minus the total FORA industry limit selected for FORA layers 1, 2, and 3, plus the total FORA premium collected for FORA layers 1, 2, and 3.
For each FORA layer, the FORA payout multiple is multiplied by the FORA insurer’s FHCF premium to calculate its FORA maximum payout. FORA payout multiples are calculated for 45 percent, 75 percent, and 90 percent FHCF mandatory coverage selections.For a FORA insurer that selects more than one layer, the FORA layer limits shall be combined to a single aggregate limit for the two covered events with the largest losses for the FORA insurer.FORA layer retentions are calculated as follows:For each FORA layer, the board shall calculate and report to each FORA insurer the initial and final FORA retention multiples for each FHCF coverage selection as the FHCF retention multiple minus the FORA payout multiple using the source data described in paragraph (5)(a). The FORA retention multiple is multiplied by the FORA insurer’s FHCF premium to calculate its FORA retention. FORA retention multiples are calculated for 45 percent, 75 percent, and 90 percent FHCF mandatory coverage selections.
The FORA industry retention for the 2023-2024 contract year for FORA layer 1 is the FHCF’s industry retention minus $1 billion. The FORA layer 2 industry retention is the FHCF industry retention minus $2 billion. The FORA layer 3 industry retention is the FHCF’s industry retention minus the quotient of $2 billion divided by the RAP qualification ratio. The FORA layer 4 industry retention is the FORA layer 3 retention minus the FORA layer 4 limit.
A FORA insurer’s initial and final FORA retentions are determined by multiplying its FHCF reimbursement premium by the FORA retention multiple for each FHCF coverage selection using the source data in paragraph (5)(a).
For a FORA insurer that selects more than one layer, the FORA combined layer retention shall be the lowest selected layer retention for each of the two covered events with the largest losses for the FORA insurer.
To ensure that insurers have properly reported the losses for which FORA reimbursements have been made, the board may inspect, examine, and verify the records of each FORA participating insurer’s covered policies at such times as the board deems appropriate for the specific purpose of validating the accuracy of losses required to be reported under the terms and conditions of the FORA reimbursement contract.(a)
FORA eligible insurers selecting coverage must execute a FORA reimbursement contract with the board.(b)
The board must enter into a FORA reimbursement contract effective June 1, 2023, with each FORA eligible insurer electing to purchase coverage. Such contract must provide coverage pursuant to this section in exchange for premium paid.(c)
The FORA reimbursement contract must be executed by the FORA insurer no later than April 15, 2023, for layers 1 through 3, and May 30, 2023, for layer 4.(d)
For the two covered events with the largest losses for the FORA insurer, the FORA reimbursement contract must contain a promise by the board to reimburse the FORA insurer for 100 percent of its losses from each covered event in excess of the lowest selected FORA layer’s retention. The sum of the FORA insurer’s covered losses from the two covered events with the largest losses from each FORA layer may not exceed the FORA insurer’s combined selected FORA layer limit or limits.(e)
The FORA reimbursement contract must provide that reimbursement amounts are not reduced by reinsurance paid or payable to the insurer from other sources.(f)
The board shall calculate and report to each FORA insurer the initial and final FORA payout multiples for each FORA layer using the source data described in paragraph (5)(a).For FORA layer 1, the FORA payout multiple is the quotient of $1 billion divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected.For FORA layer 2, the FORA payout multiple is the quotient of $1 billion divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected.For FORA layer 3, the FORA payout multiple is calculated as follows: the numerator is the quotient of $2 billion divided by the RAP qualification ratio as defined in s. 215.5551(2)(j) minus $2 billion. The denominator is the FHCF industry aggregate retention. The FORA multiple is the FHCF retention multiple multiplied by the numerator divided by the denominator.The FORA layer 4 payout multiple is the total FORA industry layer 4 limit divided by the FHCF industry aggregate retention multiplied by the FHCF retention multiple for the FHCF coverage selected. For FORA layer 4, the total FORA industry layer limit is $1 billion minus the total FORA industry limit selected for FORA layers 1, 2, and 3, plus the total FORA premium collected for FORA layers 1, 2, and 3.(g)
For each FORA layer, the FORA payout multiple is multiplied by the FORA insurer’s FHCF premium to calculate its FORA maximum payout. FORA payout multiples are calculated for 45 percent, 75 percent, and 90 percent FHCF mandatory coverage selections.(h)
For a FORA insurer that selects more than one layer, the FORA layer limits shall be combined to a single aggregate limit for the two covered events with the largest losses for the FORA insurer.(i)
FORA layer retentions are calculated as follows:For each FORA layer, the board shall calculate and report to each FORA insurer the initial and final FORA retention multiples for each FHCF coverage selection as the FHCF retention multiple minus the FORA payout multiple using the source data described in paragraph (5)(a). The FORA retention multiple is multiplied by the FORA insurer’s FHCF premium to calculate its FORA retention. FORA retention multiples are calculated for 45 percent, 75 percent, and 90 percent FHCF mandatory coverage selections.The FORA industry retention for the 2023-2024 contract year for FORA layer 1 is the FHCF’s industry retention minus $1 billion. The FORA layer 2 industry retention is the FHCF industry retention minus $2 billion. The FORA layer 3 industry retention is the FHCF’s industry retention minus the quotient of $2 billion divided by the RAP qualification ratio. The FORA layer 4 industry retention is the FORA layer 3 retention minus the FORA layer 4 limit.A FORA insurer’s initial and final FORA retentions are determined by multiplying its FHCF reimbursement premium by the FORA retention multiple for each FHCF coverage selection using the source data in paragraph (5)(a).For a FORA insurer that selects more than one layer, the FORA combined layer retention shall be the lowest selected layer retention for each of the two covered events with the largest losses for the FORA insurer.(j)
To ensure that insurers have properly reported the losses for which FORA reimbursements have been made, the board may inspect, examine, and verify the records of each FORA participating insurer’s covered policies at such times as the board deems appropriate for the specific purpose of validating the accuracy of losses required to be reported under the terms and conditions of the FORA reimbursement contract.(5)
FORA PREMIUMS.—Premiums shall be charged as follows:Fifty percent Rate on Line multiplied by the FORA insurer’s FORA layer 1 limit.
Fifty-five percent Rate on Line multiplied by the FORA insurer’s FORA layer 2 limit.
Sixty percent Rate on Line multiplied by the FORA insurer’s FORA layer 3 limit.
Sixty-five percent Rate on Line multiplied by the FORA insurer’s FORA layer 4 limit.
Initial FORA premiums shall be based on the 2023 FHCF projected industry retention, FHCF retention multiples, 2022 RAP qualification ratio, and insurers’ 2022 FHCF premiums. Final FORA premiums will be adjusted after December 31, 2023, based on December 31, 2023, FHCF premiums, FHCF industry retention, the 2023 RAP qualification ratio, and insurers’ 2023 FHCF premiums.Failure to pay the initial FORA premium in full by July 1, 2023, shall result in disqualification as a FORA insurer. The final FORA premium will be due no later than March 1, 2024.(a)
Premiums shall be charged as follows:Fifty percent Rate on Line multiplied by the FORA insurer’s FORA layer 1 limit.Fifty-five percent Rate on Line multiplied by the FORA insurer’s FORA layer 2 limit.Sixty percent Rate on Line multiplied by the FORA insurer’s FORA layer 3 limit.Sixty-five percent Rate on Line multiplied by the FORA insurer’s FORA layer 4 limit.(b)
Initial FORA premiums shall be based on the 2023 FHCF projected industry retention, FHCF retention multiples, 2022 RAP qualification ratio, and insurers’ 2022 FHCF premiums. Final FORA premiums will be adjusted after December 31, 2023, based on December 31, 2023, FHCF premiums, FHCF industry retention, the 2023 RAP qualification ratio, and insurers’ 2023 FHCF premiums.(c)
Failure to pay the initial FORA premium in full by July 1, 2023, shall result in disqualification as a FORA insurer. The final FORA premium will be due no later than March 1, 2024.(6)
CLAIMS-PAYING CAPACITY.—FORA shall not affect the claims-paying capacity of the FHCF as provided in s. 215.555(4)(c)1.(7)
INSOLVENCY OF FORA INSURER.—The FORA reimbursement contract must provide that in the event of an insolvency of a FORA insurer, the board shall pay reimbursements directly to the applicable state guaranty fund for the benefit of policyholders in this state of the FORA insurer.If an authorized insurer or the Citizens Property Insurance Corporation accepts an assignment of an unsound insurer’s FORA reimbursement contract, the board shall apply the unsound insurer’s FORA reimbursement contract to such policies and treat the authorized insurer or the Citizens Property Insurance Corporation as if it were the unsound insurer for the remaining term of the FORA reimbursement contract, with all rights and duties of the unsound insurer beginning on the date it provides coverage for such policies. This paragraph may not be construed to limit the board’s right to receive the premium due under the unsound insurer’s FORA reimbursement contract.(a)
The FORA reimbursement contract must provide that in the event of an insolvency of a FORA insurer, the board shall pay reimbursements directly to the applicable state guaranty fund for the benefit of policyholders in this state of the FORA insurer.(b)
If an authorized insurer or the Citizens Property Insurance Corporation accepts an assignment of an unsound insurer’s FORA reimbursement contract, the board shall apply the unsound insurer’s FORA reimbursement contract to such policies and treat the authorized insurer or the Citizens Property Insurance Corporation as if it were the unsound insurer for the remaining term of the FORA reimbursement contract, with all rights and duties of the unsound insurer beginning on the date it provides coverage for such policies. This paragraph may not be construed to limit the board’s right to receive the premium due under the unsound insurer’s FORA reimbursement contract.(8)
VIOLATIONS.—Any violation of this section or of rules adopted under this section constitutes a violation of the Florida Insurance Code.(9)
LEGAL PROCEEDINGS.—The board may take any action necessary to enforce the rules, provisions, and requirements of the FORA reimbursement contract under this section.(10)
RULEMAKING.—The board may adopt rules to implement this section. In addition, the board may adopt emergency rules pursuant to s. 120.54(4) at any time as are necessary to implement this section for the 2023-2024 fiscal year. The Legislature finds that such emergency rulemaking power is necessary in order to address a critical need in the state’s problematic property insurance market. The Legislature further finds that the uniquely short timeframe needed to effectively implement this section for the 2023-2024 fiscal year requires that the board adopt rules as quickly as practicable. Therefore, in adopting such emergency rules, the board need not make the findings required by s. 120.54(4)(a). Emergency rules adopted under this section are exempt from s. 120.54(4)(c) and shall remain in effect until replaced by rules adopted under the nonemergency rulemaking procedures of chapter 120, which must occur no later than December 31, 2023.(11)
APPROPRIATION.—Within 60 days after a covered event, the board shall submit written notice to the Executive Office of the Governor if the board determines that funds from FORA coverage established by this section will be necessary to reimburse FORA insurers for losses associated with the covered event. The initial notice, and any subsequent requests, must specify the amount necessary to provide FORA reimbursements. Upon receiving such notice, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer to the board for FORA in the amount requested. The Executive Office of the Governor shall provide written notification to the chair and vice chair of the Legislative Budget Commission at least 3 days before the effective date of the warrant. Cumulative transfers authorized under this paragraph may not exceed $1 billion.Upon this act becoming a law, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer of $2 million to the board for the implementation and administration of FORA and post-event examinations for covered events that require FORA coverage. If the board determines additional administrative funds are needed, the board shall submit written notice to the Executive Office of the Governor that funds will be necessary for the implementation and administration of FORA and post-event examinations for covered events that require FORA coverage. The notice must specify the amount necessary for administration of FORA and post-event examinations. Upon receiving such notice, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer to the board for FORA in the amount requested. The Executive Office of the Governor shall provide written notification to the chair and vice chair of the Legislative Budget Commission at least 3 days before the effective date of the warrant. Cumulative transfers authorized under this paragraph may not exceed $6 million.If a covered event occurs that triggers reimbursements under FORA, no later than January 31, 2024, and quarterly thereafter, the board shall submit a report to the Executive Office of the Governor, the President of the Senate, and the Speaker of the House of Representatives detailing any reimbursements of FORA, all premiums collected, all loss development projections, and detailed information about administrative and post-event examination activities and expenditures.(a)
Within 60 days after a covered event, the board shall submit written notice to the Executive Office of the Governor if the board determines that funds from FORA coverage established by this section will be necessary to reimburse FORA insurers for losses associated with the covered event. The initial notice, and any subsequent requests, must specify the amount necessary to provide FORA reimbursements. Upon receiving such notice, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer to the board for FORA in the amount requested. The Executive Office of the Governor shall provide written notification to the chair and vice chair of the Legislative Budget Commission at least 3 days before the effective date of the warrant. Cumulative transfers authorized under this paragraph may not exceed $1 billion.(b)
Upon this act becoming a law, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer of $2 million to the board for the implementation and administration of FORA and post-event examinations for covered events that require FORA coverage. If the board determines additional administrative funds are needed, the board shall submit written notice to the Executive Office of the Governor that funds will be necessary for the implementation and administration of FORA and post-event examinations for covered events that require FORA coverage. The notice must specify the amount necessary for administration of FORA and post-event examinations. Upon receiving such notice, the Executive Office of the Governor shall instruct the Chief Financial Officer to draw a warrant from the General Revenue Fund for a transfer to the board for FORA in the amount requested. The Executive Office of the Governor shall provide written notification to the chair and vice chair of the Legislative Budget Commission at least 3 days before the effective date of the warrant. Cumulative transfers authorized under this paragraph may not exceed $6 million.(c)
If a covered event occurs that triggers reimbursements under FORA, no later than January 31, 2024, and quarterly thereafter, the board shall submit a report to the Executive Office of the Governor, the President of the Senate, and the Speaker of the House of Representatives detailing any reimbursements of FORA, all premiums collected, all loss development projections, and detailed information about administrative and post-event examination activities and expenditures.(12)
EXPIRATION DATE.—If no general revenue funds have been transferred to the board for FORA under subsection (11) by June 30, 2026, this section expires on July 1, 2026. If general revenue funds have been transferred to the board for FORA under subsection (11) by June 30, 2026, this section expires on July 1, 2030, and all unencumbered funds collected under this section shall be transferred by the board back to the General Revenue Fund unallocated.
Source:
Section 215.5552 — Florida Optional Reinsurance Assistance program, https://www.flsenate.gov/Laws/Statutes/2024/0215.5552 (accessed Aug. 7, 2025).