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HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to the Florida Hurricane Catastrophe 2
Fund; amending s. 215.555, F.S.; specifying the 3
retention multiple for specified contracts; deleting 4
obsolete language; providing the adjusted retention 5
multiple for insurers electing the 100-percent 6
coverage level; requiring that the reimbursement 7
contract contain a promise by the State Board of 8
Administration to reimburse the insurer a specified 9
percentage of its losses and applicable loss 10
adjustment expenses; specifying the loss adjustment 11
expense for specified contracts and rates; modifying 12
the contract obligation of the board for a contract 13
year; deleting provisions regarding reimbursements; 14
requiring that the hurricane loss portion of a 15
specified formula be determined by averaging the 16
results of certain catastrophe models; authorizing, 17
rather than requiring, a certain formula to provide 18
for a cash build-up factor; requiring the cash build-19
up factor to be frozen beginning in a specified 20
contract year and to freeze for a specified period 21
ending by a specified date; requiring the savings 22
realized as a result of the freeze of the cash build-23
up factor to be passed to consumers; requiring the 24
board to file certain premiums with the Office of 25
HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
Insurance Regulation; requiring the office to review 26
such premiums; prohibiting certain costs from being 27
added to the cost of the reimbursement contracts; 28
providing an effective date. 29
30
Be It Enacted by the Legislature of the State of Florida: 31
32
Section 1. Paragraph (e) of subsection (2), paragraphs 33
(b), (c), and (d) of subsection (4), paragraph (b) of subsection 34
(5), and paragraph (a) of subsection (7) of section 215.555, 35
Florida Statutes, are amended to read: 36
215.555 Florida Hurricane Catastrophe Fund.— 37
(2) DEFINITIONS.—As used in this section: 38
(e) "Retention" means the amount of losses below which an 39
insurer is not entitled to reimbursement from the fund. An 40
insurer's retention shall be calculated as follows: 41
1. The board shall calculate and report to each insurer 42
the retention multiples for that year. For the contract year 43
beginning June 1, 2026 2005, the retention multiple must shall 44
be equal to $8.5 $4.5 billion divided by the total estimated 45
reimbursement premium for the contract year; for subsequent 46
years, the retention multiple shall be equal to $4.5 billion, 47
adjusted based upon the reported exposure for the contract year 48
occurring 2 years before the particular contract year to reflect 49
the percentage growth in exposure to the fund for covered 50
HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
policies since 2004, divided by the total estimated 51
reimbursement premium for the contract year. Total reimbursement 52
premium for purposes of the calculation under this subparagraph 53
shall be estimated using the assumption that all insurers have 54
selected the 90-percent coverage level. 55
2. The retention multiple as determined under subparagraph 56
1. shall be adjusted to reflect the coverage level elected by 57
the insurer. For insurers electing the 100-percent coverage 58
level, the adjusted retention multiple is 90 percent of the 59
amount determined under subparagraph 1. For insurers electing 60
the 90-percent coverage level, the adjusted retention multiple 61
is 100 percent of the amount determined under subparagraph 1. 62
For insurers electing the 75-percent coverage level, the 63
retention multiple is 120 percent of the amount determined under 64
subparagraph 1. For insurers electing the 45-percent coverage 65
level, the adjusted retention multiple is 200 percent of the 66
amount determined under subparagraph 1. 67
3. An insurer shall determine its provisional retention by 68
multiplying its provisional reimbursement premium by the 69
applicable adjusted retention multiple and shall determine its 70
actual retention by multiplying its actual reimbursement premium 71
by the applicable adjusted retention multiple. 72
4. For insurers who experience multiple covered events 73
causing loss during the contract year, beginning June 1, 2005, 74
each insurer's full retention shall be applied to each of the 75
HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
covered events causing the two largest losses for that insurer. 76
For each other covered event resulting in losses, the insurer's 77
retention shall be reduced to one-third of the full retention. 78
The reimbursement contract must shall provide for the 79
reimbursement of losses for each covered event based on the full 80
retention with adjustments made to reflect the reduced 81
retentions on or after January 1 of the contract year provided 82
the insurer reports its losses as specified in the reimbursement 83
contract. 84
(4) REIMBURSEMENT CONTRACTS.— 85
(b)1. The contract must shall contain a promise by the 86
board to reimburse the insurer for 45 percent, 75 percent, or 90 87
percent, or 100 percent of its losses and applicable loss 88
adjustment expenses from each covered event in excess of the 89
insurer's retention, plus 5 percent of the reimbursed losses to 90
cover loss adjustment expenses. For contracts and rates 91
effective on or after June 1, 2026 2019, the loss adjustment 92
expense included reimbursement must be the lesser of 25 10 93
percent of the total subject losses before reimbursement or the 94
total subject actual loss adjustment expenses reimbursed losses. 95
2. The insurer must elect one of the percentage coverage 96
levels specified in this paragraph and may, upon renewal of a 97
reimbursement contract, elect a lower percentage coverage level 98
if no revenue bonds issued under subsection (6) after a covered 99
event are outstanding, or elect a higher percentage coverage 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
level, regardless of whether or not revenue bonds are 101
outstanding. All members of an insurer group must elect the same 102
percentage coverage level. Any joint underwriting association, 103
risk apportionment plan, or other entity created under s. 104
627.351 must elect the 90-percent coverage level. 105
3. The contract must shall provide that reimbursement 106
amounts may shall not be reduced by reinsurance paid or payable 107
to the insurer from other sources. 108
(c)1. The contract must shall also provide that the 109
obligation of the board with respect to all contracts covering a 110
particular contract year is shall not exceed the actual claims-111
paying capacity of the fund up to a limit of $17 billion for 112
that contract year, unless the board determines that there is 113
sufficient estimated claims-paying capacity to provide $17 114
billion of capacity for the current contract year and an 115
additional $17 billion of capacity for subsequent contract 116
years. If the board makes such a determination, the estimated 117
claims-paying capacity for the particular contract year shall be 118
determined by adding to the $17 billion limit one-half of the 119
fund's estimated claims-paying capacity in excess of $34 120
billion. However, the dollar growth in the limit may not 121
increase in any year by an amount greater than the dollar growth 122
of the balance of the fund as of December 31, less any premiums 123
or interest attributable to optional coverage, as defined by 124
rule which occurred over the prior calendar year. 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
2. In May and October of the contract year, the board 126
shall publish in the Florida Administrative Register a statement 127
of the fund's estimated borrowing capacity, the fund's estimated 128
claims-paying capacity, and the projected balance of the fund as 129
of December 31. After the end of each calendar year, the board 130
shall notify insurers of the estimated borrowing capacity, 131
estimated claims-paying capacity, and the balance of the fund as 132
of December 31 to provide insurers with data necessary to assist 133
them in determining their retention and projected payout from 134
the fund for loss reimbursement purposes. In conjunction with 135
the development of the premium formula, as provided for in 136
subsection (5), the board shall publish factors or multiples 137
that assist insurers in determining their retention and 138
projected payout for the next contract year. For all regulatory 139
and reinsurance purposes, an insurer may calculate its projected 140
payout from the fund as its share of the total fund premium for 141
the current contract year multiplied by the sum of the projected 142
balance of the fund as of December 31 and the estimated 143
borrowing capacity for that contract year as reported under this 144
subparagraph. 145
(d)1. For purposes of determining potential liability and 146
to aid in the sound administration of the fund, the contract 147
must shall require each insurer to report such insurer's losses 148
from each covered event on an interim basis, as directed by the 149
board. The contract must shall require the insurer to report to 150
HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
the board no later than December 31 of each year, and quarterly 151
thereafter, its reimbursable losses from covered events for the 152
year. The contract must shall require the board to determine and 153
pay, as soon as practicable after receiving these reports of 154
reimbursable losses, the initial amount of reimbursement due and 155
adjustments to this amount based on later loss information. The 156
adjustments to reimbursement amounts must shall require the 157
board to pay, or the insurer to return, amounts reflecting the 158
most recent calculation of losses. 159
2. In determining reimbursements pursuant to this 160
subsection, the contract shall provide that the board shall pay 161
to each insurer such insurer's projected payout, which is the 162
amount of reimbursement it is owed, up to an amount equal to the 163
insurer's share of the actual premium paid for that contract 164
year, multiplied by the actual claims-paying capacity available 165
for that contract year. 166
3. The board may reimburse insurers for amounts up to the 167
published factors or multiples for determining each 168
participating insurer's retention and projected payout derived 169
as a result of the development of the premium formula in those 170
situations in which the total reimbursement of losses to such 171
insurers would not exceed the estimated claims-paying capacity 172
of the fund. Otherwise, the projected payout factors or 173
multiples shall be reduced uniformly among all insurers to 174
reflect the estimated claims-paying capacity. 175
HB 1349 2026
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(5) REIMBURSEMENT PREMIUMS.— 176
(b) The State Board of Administration shall select an 177
independent consultant to develop a formula for determining the 178
actuarially indicated premium to be paid to the fund. The 179
hurricane loss portion of the formula must be determined by 180
averaging the results of all the catastrophe models approved by 181
the Florida Commission on Hurricane Loss Projection Methodology. 182
The formula must shall specify, for each zip code or other 183
limited geographical area, the amount of premium to be paid by 184
an insurer for each $1,000 of insured value under covered 185
policies in that zip code or other area. In establishing 186
premiums, the board shall consider the coverage elected under 187
paragraph (4)(b) and any factors that tend to enhance the 188
actuarial sophistication of ratemaking for the fund, including 189
deductibles, type of construction, type of coverage provided, 190
relative concentration of risks, and other such factors deemed 191
by the board to be appropriate. The formula may must provide for 192
a cash build-up factor. For the 2009-2010 contract year, the 193
factor is 5 percent. For the 2010-2011 contract year, the factor 194
is 10 percent. For the 2011-2012 contract year, the factor is 15 195
percent. For the 2012-2013 contract year, the factor is 20 196
percent. For the 2013-2014 contract year and thereafter, the 197
factor is 25 percent; however, the cash build-up factor must be 198
frozen beginning in the 2026-2027 contract year and must freeze 199
for a 12-month period ending no later than July 1, 2027. Any 200
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
savings realized as a result of the freeze of the cash build-up 201
factor must be passed directly to the consumer. The formula may 202
provide for a procedure to determine the premiums to be paid by 203
new insurers that begin writing covered policies after the 204
beginning of a contract year, taking into consideration when the 205
insurer starts writing covered policies, the potential exposure 206
of the insurer, the potential exposure of the fund, the 207
administrative costs to the insurer and to the fund, and any 208
other factors deemed appropriate by the board. The formula must 209
be approved by unanimous vote of the board. The board may, at 210
any time, revise the formula pursuant to the procedure provided 211
in this paragraph. The board shall file the premiums to be paid 212
with the Office of Insurance Regulation, and the office shall 213
review such premiums. 214
(7) ADDITIONAL POWERS AND DUTIES.— 215
(a) The board may procure reinsurance from reinsurers 216
acceptable to the Office of Insurance Regulation for the purpose 217
of maximizing the capacity of the fund and may enter into 218
capital market transactions, including, but not limited to, 219
industry loss warranties, catastrophe bonds, side-car 220
arrangements, or financial contracts permissible for the board's 221
usage under s. 215.47(11) and (12), consistent with prudent 222
management of the fund. The cost of any reinsurance or other 223
capital market transaction other than issuing bonds secured by 224
assessments purchased by the board to maximize the claims-paying 225
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
capacity of the fund may not be added to the actuarially 226
determined cost of the reimbursement contracts. 227
Section 2. This act shall take effect upon becoming a law. 228
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