Florida SB 894: Mortgage Regulation

Bill Text

894 
Restrictions on Employer-owned Life Insurance Policies 
2025-12-12T10:02:33Z 
Authorizing employer-owned life insurance policies covering certain key persons of business entities, organizations, companies, and corporations under specified circumstances; providing that premiums, loan interests, and expenses related to employer-owned life insurance are not tax deductible; specifying that insurers that violate certain provisions are subject to a fine of up to $1 million per violation and may have its authority to transact insurance suspended or revoked, etc. 
Original Filed Version 
2026 
S 
2026-07-01T00:00:00Z 
GB 
General Bill 
__ 

 Florida Senate - 2026 SB 894 

 By Senator Martin 

 33-01125-26 2026894__ 
 1 A bill to be entitled 
 2 An act relating to restrictions on employer-owned life 
 3 insurance policies; creating s. 627.4635, F.S.; 
 4 providing definitions; authorizing employer-owned life 
 5 insurance policies covering certain key persons of 
 6 business entities, organizations, companies, and 
 7 corporations under specified circumstances; requiring 
 8 certain disclosures to such key persons; prohibiting 
 9 employer-owned life insurance policies covering 
 10 certain employees; providing that policies covering 
 11 such employees are void as against public policy; 
 12 requiring insurer notice to the Office of Insurance 
 13 Regulation of employer-owned life insurance policies; 
 14 requiring the office to maintain a registry and to 
 15 publish an annual report; requiring certain employer 
 16 disclosures relating to employer-owned life insurance 
 17 policies; providing that premiums, loan interests, and 
 18 expenses related to employer-owned life insurance are 
 19 not tax deductible; subjecting death benefits received 
 20 by employers to corporate income tax; providing an 
 21 exception; providing penalties; specifying that 
 22 employees’ families have a specified private right of 
 23 action under certain circumstances; specifying that 
 24 insurers that violate certain provisions are subject 
 25 to a fine of up to $1 million per violation and may 
 26 have its authority to transact insurance suspended or 
 27 revoked; requiring the office to adopt certain 
 28 standard forms by a specified date; providing 
 29 applicability and retroactive applicability; providing 
 30 construction; providing an effective date. 
 31 
 32 Be It Enacted by the Legislature of the State of Florida: 
 33 
 34 Section 1. Section 627.4635, Florida Statutes, is created 
 35 to read: 
 36 627.4635 Restrictions on employer-owned life insurance 
 37 policies.— 
 38 (1) DEFINITIONS.—As used in this section, the term: 
 39 (a) “Employer-owned life insurance” means a life insurance 
 40 policy owned by, or payable to, an employer on the life of a 
 41 current or former employee. The term also includes company-owned 
 42 life insurance or corporate-owned life insurance, a life 
 43 insurance policy owned by, or payable, to a company or 
 44 corporation, rather than an individual, on the life of a current 
 45 or former employee. 
 46 (b) “Key person” means an owner, senior executive, 
 47 director, officer, partner, or manager of a business entity, 
 48 organization, company, or corporation whose death would cause 
 49 direct, material financial harm to the business entity, 
 50 organization, company, or corporation. 
 51 (c) “Rank-and-file employee” means any employee who is not 
 52 a key person. 
 53 (2) EMPLOYER-OWNED LIFE INSURANCE POLICIES COVERING KEY 
 54 PERSONS.— 
 55 (a) An employer may purchase, maintain, or be a beneficiary 
 56 of an employer-owned life insurance policy covering a key person 
 57 only if all the following conditions are met: 
 58 1. The employer has obtained the key person’s informed, 
 59 written, and revocable consent before purchasing the policy. 
 60 2. The employer has provided written notice of the policy 
 61 to the key person’s spouse, next of kin, or estate 
 62 representative within 30 days after issuance of the policy. 
 63 3. The employer does not maintain more than five key person 
 64 policies at any one time without prior approval of the office. 
 65 The five key persons must be the five highest ranking persons in 
 66 the employer’s business, organization, company, or corporation, 
 67 based on their seniority, salaries, and benefits. 
 68 4. The death benefit of any key person’s policy does not 
 69 exceed five times that key person’s average annual compensation 
 70 for the 3 years immediately preceding issuance. 
 71 5. Upon the key person’s termination of employment, the 
 72 employer either cancels the policy or, with the key person’s 
 73 written consent, transfers ownership to the key person or his or 
 74 her family. 
 75 (b)1. If an employer-owner life insurance policy is issued 
 76 before July 1, 2026, and all the conditions in paragraph (a) are 
 77 met, the employer must, by January 1, 2027, provide to the key 
 78 person whose life is covered by the