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Background | Customer FAQ | Florida State OIR Web Site
PLEASE NOTE: THE FLORIDA CATASTROPHE FUND ASSESSMENT ONLY PERTAINS TO THOSE LENDERS/CREDIT UNIONS HOLDING POLICIES FOR MORTGAGE LOANS ON PROPERTIES LOCATED IN THE STATE OF FLORIDA.
FLORIDA CATASTROPHE FUND ASSESSMENT FAQ
In 2006, the Florida Office of Insurance Regulation issued an order levying a 1% emergency assessment upon all property and casualty business in the state in 2007, with the option of renewing the assessment automatically for the next five years. CMG Mortgage Insurance Company (CMG MI) has notified our customers and prepared this FAQ to assist you in understanding your responsibility.
Why is this assessment being levied?
Who must pay this assessment?
Does this assessment pertain to all insurance lines?
Does this assessment apply to loans on all properties?
How long does the assessment last?
Where can customers get information regarding the assessment?
Do any of CMG MI’s customer documents change?
Are the CMG MI Web sites updated?
If the premium is billed and paid prior to January 1, 2007, is there an assessment?
If the premium is billed in 2006, but paid in January 2007, is there an assessment?
Is the assessment included in all billings (Disclosures, Accommodations and Remedies)?
What if the customer does not pay the assessment?
For additional information, please consult the Florida Office of Insurance Regulation.
Why is this assessment being levied?
The state of Florida was hit hard during the hurricane seasons of 2004 & 2005. The Florida Hurricane Catastrophe Fund has exhausted nearly all reserves
accumulated since 1993. This assessment is an attempt to rebuild their emergency fund.
Who must pay this assessment?
Among others, all lenders and Credit Unions insured under mortgage insurance policies in effect on or after January 1, 2007, in the state of Florida. They must remit payment to their insurance companies, who then transfer the payments to the state of Florida.
Does this assessment pertain to all insurance lines?
No, this only applies to lines of insurance classified by the National Association of Insurance Commissioners (NAIC) as “Property and Casualty,” which does include mortgage guaranty insurance. Therefore, it does not pertain to Title, Life or Health Insurance.
Does this assessment apply to loans on all properties?
Only CMG MI commitments and Certificates of Insurance issued on or after January 1, 2007, for member-paid loans on properties located in Florida include the 1% assessment.
How long does the assessment last?
The initial assessment period was for one year (January 1-December 31, 2007) but Florida had the authorization to renew automatically for each of the following five years. The assessment has been renewed for 2008.
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Where can customers get information regarding the assessment?
Refer to the website for Florida’s Office of Insurance Regulation.
Do any of CMG MI’s customer documents change?
Yes, the CMG MI Certificates of Insurance reflect the 1% assessment.
Both of our initial and renewal paper bills reflect the 1% assessment.
Are the CMG MI Web sites updated?
Yes – www.e-cmgmi.com has been updated to reflect the assessment. This FAQ and formal notification to customers are posted on www.cmgmi.com. The Rate Quote service also includes the 1% assessment. The MI AdvantageSM Calculator features a disclaimer stating that the assessment has not been factored into the rates.
If the premium is billed and paid prior to January 1, 2007, is there an assessment?
No – there is no assessment.
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If the premium is billed in 2006, but paid in January 2007, is there an assessment?
No - there is no assessment. Only bills for commitments made on or after January 1, 2007, are assessed.
Is the assessment included in all billings (Disclosures, Accommodations and Remedies)?
Yes – if the bill is for an effective date in 2007 and beyond, it includes the assessment.
What if the customer does not pay the assessment?
CMG MI remits the assessment to Florida and monitors our collections from Credit Unions. We plan to follow up with those customers who fail to pay to ensure they understand that this assessment is required to be paid.
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