Fla. Admin. Code Ann. R. 69O-201.005 - Financial Requirements Regarding the Unearned Premium Reserve Liability Account and the Deposit or Bond
(1) "Gross
Written Premiums" means the total amount of premiums paid by the consumer for
the entire period of the legal expense insurance contract, including
commission.
(2) "Obligated" means
outstanding contracts in force which have not expired or been canceled and a
refund made to the consumer.
(3)
The unearned premium reserve account is calculated as follows:
(a) For all one year policies, the minimum
reserve for all legal expense insurance corporations shall be 50% of the gross
written premium for which the corporation is obligated on all policies issued
in any state.
(b) A legal expense
insurance corporation may count as one-month policies those policies which are
paid by the month and can be cancelled by either party with 30 days notice. The
reserve amount required on monthly policies is one-half of the total monthly
gross written premium. The legal expense insurance corporation must specify if
the reserve is calculated on a monthly basis.
(c)
1. For
all multiyear policies issued in any state the reserve shall initially be
calculated at 50% of the gross written premium for the first year premium, and
100% for each subsequent year's premium, for all gross written premiums for
which the legal expense insurance corporation is obligated.
2. As each subsequent year becomes current,
50 percent of that current year's premium is earned and shall be subtracted
from the reserve.
3. The reserve is
maintained until the expiration of the multiyear
policy.
(4) For
purposes of determining the amount of the required deposit under Section
642.023, F.S., the amount of
gross written premium in force is the total gross written premium for one full
year.
Notes
Rulemaking Authority 624.308(1) FS. Law Implemented 624.307(1), 625.051, 642.023, 642.032 FS.
New 6-23-92, Formerly 4-201.005, Amended 5-25-21.
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